The horizon is not so far as we can see, but as far as we can imagine

Month: September 2019 Page 1 of 3

Week-end Wrap – Political Economy – September 29, 2019

by Tony Wikrent
Economics Action Group, North Carolina Democratic Party Progressive Caucus

Strategic Political Economy

DC Court: State Secrets Privilege Trumps Any Citizens’ Right To Know Whether Or Not Their Own Gov’t Is Trying To Kill Them

[TechDirt, via Naked Capitalism 9-27-19]The Culmination of Republican Decay
Sean Wilentz [New York Review of Books, October 10, 2019 issue]

Book review of American Carnage: On the Front Lines of the Republican Civil War and the Rise of President Trump, by Tim Albert

….After Barack Obama was elected president, the Koch brothers and the Donors Trust of dark money funders (to which the Kochs were leading contributors) would mobilize and subsidize the Republican base in the so-called populist revolt they named the Tea Party…. when Trump seized control of the GOP in 2016, he reaped the populist whirlwind that Richard Nixon began sowing nearly half a century earlier and that the Bush administration—their administration—had whipped to hurricane force….

By the time Alberta’s account gets underway, most of the political dynamics behind the events he describes were long established and extremely powerful. Some of the book’s major figures, like former House Speaker John Boehner (who was also one of its principal sources), were remnants from earlier phases of the party’s strife, and developments like the growth of the Tea Party or the uprisings of the House Freedom Caucus make sense only as outgrowths of previous internecine battles. Most importantly, by 2008, the Republican Party had already become what the political scientists Thomas E. Mann and Norman J. Ornstein would call “an insurgent outlier” in American politics: “ideologically extreme… scornful of compromise; unpersuaded by conventional understanding of facts, evidence and science; and dismissive of the legitimacy of its political opposition.” Alberta has written, in short, a book that is more denouement than drama, detailing the fall of a hollow GOP establishment that, having abandoned normal party politics in favor of relentless polarization, was already teetering. While American Carnage describes the outcome of the party’s radicalization, it completely misses—indeed, fundamentally misunderstands—a major impetus behind Trump’s ascendancy: the destructive presidency of George W. Bush….

[Alberta’s account] cannot explain how Trump could so swiftly capture virtually an entire political party. A plausible answer to that puzzle is hiding in plain sight in Alberta’s book. Although Trump came into office with majorities in both houses of Congress, and although, as Alberta notes, the White House ceded control over domestic legislation to Senate Majority Leader McConnell and Speaker Paul Ryan, the Republicans had terrible difficulty scoring legislative wins. Most galling to Trump as well as the party’s congressional leadership was the failure to repeal Obamacare, one of the GOP’s core campaign pledges since the program began. On two fronts, though, Republicans moved with absolute assurance: the approval by the Senate of right-wing nominees to the federal bench, including Supreme Court justices Neil Gorsuch and, after a brutal, unexpected fight, Brett Kavanaugh; and the rapid approval of a fiercely regressive tax bill in 2017. Control of the courts for the Christian right and the Federalist Society, tax windfalls and deregulation for the donor class: these were the causes that truly stirred the GOP majorities in Congress. It’s not simply that the recumbent Republicans are intimidated by the party base that Trump has captured; they are motivated chiefly by right-wing dogma and their own baseness, which Trump understands and manipulates.

The Problem With Impeachment

Chris Hedges [Truthdig, via Naked Capitalism 9-28-19]

Impeaching Donald Trump would do nothing to halt the deep decay that has beset the American republic. It would not magically restore democratic institutions. It would not return us to the rule of law. It would not curb the predatory appetites of the big banks, the war industry and corporations. It would not get corporate money out of politics or end our system of legalized bribery. It would not halt the wholesale surveillance and monitoring of the public by the security services. It would not end the reigns of terror practiced by paramilitary police in impoverished neighborhoods or the mass incarceration of 2.3 million citizens. It would not impede ICE from hunting down the undocumented and ripping children from their arms to pen them in cages. It would not halt the extraction of fossil fuels and the looming ecocide. It would not give us a press freed from the corporate mandate to turn news into burlesque for profit. It would not end our endless and futile wars. It would not ameliorate the hatred between the nation’s warring tribes—indeed would only exacerbate these hatreds.

Impeachment is about cosmetics. It is about replacing the public face of empire with a political mandarin such as Joe Biden, himself steeped in corruption and obsequious service to the rich and corporate power, who will carry out the same suicidal policies with appropriate regal decorum.

GND – A problem too big to solve, or an opportunity too big to miss?

Open Thread

As usual, feel free to use the comments to discuss topics not related to recent posts.

Modern Meritocracy Isn’t Worth Having

Meritocracy is the simple argument that the best person for the job should do it and that our system tends to put the best person for a job in the position.

Some jobs are more important than others, and should be paid more as a result, both to get the best person to do it, and because the best person will contribute more.

The problem with these arguments is simple: It ain’t so.

The best paid people in our economy, generally speaking, are those in the financial industry: bankers, shadow bankers, brokers and so on.

They caused a world economic crisis with their venal and idiotic behaviour in the 2000s. They currently can’t find enough good things to do with all the money they control, so interest rates are moving negative.

They are manifestly incompetent at their jobs–if the job is to do anything but enrich themselves. They cannot be the best people for the job, because they would all be out of the job if governments hadn’t bailed them out, and indeed most of them would probably be in jail if the law had been enforced.

They are paid better than those who managed the financial industry in the 40s, 50s, and 60s, who manifestly created a better economy, including higher growth rates.

Paying them more, then, has been correlated with them doing a worse job at everything except making themselves richer, and they only even managed that by corrupting the government to bail them out of their mistakes, and with endless government support, with Greenspan, Bernanke, Yellen, and so on endlessly doing whatever was necessary to keep financial markets growing in size. (The Greenspan Put.)

Studies, meanwhile, have found that the higher a CEO’s pay, the worse their company performs.

It seems that perhaps the best paid people in the world aren’t the most meritorious, except by the rules of jungle. If one wants to argue that you “eat what you kill” as Wall Street does, then all merit constitutes is the ability get a lot of money.

Merit = money is the actually state of meritocracy in the world today. Oh, there are exceptions, you can say “surgeons” or something, but they aren’t the best paid people in the world, are they?

Meanwhile, as I like to point out, if the janitor doesn’t show up, people get really, really upset, while if the CEO takes a week off most people won’t notice or care.

Seems people really, really don’t like cleaning toilets, but doing so is really, really important, and we don’t pay, errr, shit for doing it.

But, you cry, “Ian, any idiot can clean a toilet.”

Well, I’m not so sure about that, but what is true is that most janitors are competent at their jobs and most banking executives are good only at making themselves rich. They are net drain on society, massively, while janitors provide real value and are able to do their jobs.

Teachers, nurses, garbage men, civil engineers, construction workers, etc, etc., all do things that matter. When they don’t do them or do them badly, we’re fucked.

Bankers do something that matters, too. The problem is that we clearly pick completely incompetent or corrupt bozos to do the job, who then pretend they are the best of the best, destroy the economy and the environment, and reward themselves with money that would make 19th century robber barons blush.

Meritocracy is a wonderful idea. We all want the best person for each job to be doing the job, or at least, someone who is competent at the job doing the job.

But that’s not what we have. What we have is a Kakistocracy: A society run by the worst, most corrupt people. Bush, Obama, and Trump weren’t the best at running society, they were just the people best at getting into office. The people running Wall Street aren’t the best at allocating money for social benefit, or even for creating the largest actual economy, they’re just the people who fought their way to top and then appropriated the largest share of money for themselves while shattering the world economy.

They are the best only at seizing positions of power, which give them access to money. That is all.

If meritocracy is just, “The more money you have, the more you deserve to have more money,” which it is at the moment, it’s nothing worth having.

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Pelosi Moves to Impeach Trump

Nancy Pelosi

This is a good thing. Trump’s done more than one thing that was illegal and impeachment-worthy.

It is interesting and amusing that what finally got her to do something was to attack Biden–someone she knows well–rather than all the crimes against people she doesn’t care about, but if that’s what it takes, so be it.

Impeachment, done properly, is about using the power of the House to control the narrative and build the case. It was not popular when it started against Nixon; it was the impeachment hearings themselves that made the case.

One hopes that Pelosi and her team will take this into account, and showcase Trump’s various misdeeds properly. One also hopes they will stop playing patty-cake with Trump officials and use Congress’s powers of inherent contempt on those who refuse to testify, or who lie.

Of course, Trump will not be convicted. But he can easily be damaged, and his ability to enact his policies can be crippled. Clinton’s impeachment attempt was followed by two Republican presidential terms.

It will be interesting to see if Pelosi has any ability to follow blood in the water.

The results of the work I do, like this article, are free, but food isn’t, so if you value my work, please DONATE or SUBSCRIBE.

UK Supreme Court Rules Prorogue Illegal

Queen Elizabeth II

News out of England continues to be important. The Supreme Court said that Johnson’s advice was “unlawful, void, and of no effect.”


This is a fantastically good thing. The use of proroguing to avoid oversight by Parliament is a great evil. Some years back it was used in Canada to avoid a vote of no-confidence that Prime Minister Harper knew he would lose.

I do think that the Queen, and the Queen’s representatives, need to be more willing to say, “No.” It was obvious what Johnson was doing.

As for Brexit, I want to point out something simple, that has been lost in the furor: It’s going to be settled by an election. Johnson has gotten rid of the anti-Brexit MPs. Even if he obeys the law and extends the leave period, there will then be an election. Who wins will determine what happens.

This is AS IT SHOULD BE. It is right to put this to an election. I prefer Corbyn’s position of negotiating a Brexit then putting it as a referendum, but an election fought over the issue is precisely what should happen in a democracy.

You either believe that legitimacy comes from the people, or you don’t.

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The Democratic Ethics of Brexit

The bottom line here is that there was a referendum, and “leave” won.

All my life, I have eaten election and referendum results I hated. I have done so because of democratic legitimacy: The people, even if I or anyone else think they are wrong, are the source of legitimate rule.

There was a referendum. Leave won. Brexit should, thus, be the policy of the government.

At the same time, like any policy, the idea is to do it right, and both May’s plan and Hard Brexit will be very bad for Britain.

When people voted, they voted to Leave without really knowing what it would mean.

So we have a situation where the parties policies are:

The Tory policy is to leave no matter what, even if it’s against the law, against parliament, and will be disastrous.

Lib-Dem’s policy is “Fuck the referendum, we should just stay.”

Labour’s policy is to negotiate a deal to leave, then put it to a referendum.

I don’t think Labour’s stance (which was re-affirmed today by the membership) is the best politics. But it is the path which maintains democratic legitimacy, the primacy of parliament, and tries to make sure that, if Brexit, happens it is not disastrous.

It is, to my mind, the actual right policy in ethical terms. Both the referendum and the parliament have legitimacy, and that legitimacy should be respected.

The results of the work I do, like this article, are free, but food isn’t, so if you value my work, please DONATE or SUBSCRIBE.


Week-end Wrap – Political Economy – September 22, 2019

by Tony Wikrent
Economics Action Group, North Carolina Democratic Party Progressive Caucus

Strategic Political Economy

Matt Stoller [Pro-Market, via Naked Capitalism 9-18-19]

Director is the key founder of what is now known as the Chicago School of law and economics, which reshaped the American approach to corporate power and political economy…. Director’s life was dedicated to setting free the power of concentrated capital, eliminating the power of labor, and undoing the New Deal. His success is so profound it is hard to describe, so embedded are we today in the world and rhetoric Director shaped.

Brahmin Left vs Merchant Right: Rising Inequality and the Changing Structure of Political Conflict (Evidence from France, Britain and the US, 1948-2017) (PDF)

Thomas Piketty [via Naked Capitalism 9-15-19]

…changing political cleavages in FR-US-UK 1948-2017 documenting the shift from class-based political conflict to multiple-elite (intellectual vs business elite) and identity-based political conflict.

Main empirical finding: the rise of multiple-elite politics

  • • In the 1950s-60s, the vote for left-wing (labour-socialist-democratic) parties in France-UK-US used to be associated with lower education & lower income voters: class-based political conflict (→ redistributive policies)
  • • It has gradually become associated since 1970s-80s with higher education voters, giving rise since 1990s-2000s to a multiple-elite party system: high- education elites vote left, while high-ncome/high-wealth elites vote right. I.e. intellectual elite (Brahmin left) vs business elite (Merchant right).

Keynes Was Really a Conservative
Bruce Bartlett [via Naked Capitalism 9-16-19]

Peter Drucker, a conservative admirer of Keynes, viewed him as not merely conservative, but ultraconservative. “He had two basic motivations,” Drucker explained in a 1991 interview with Forbes. “One was to destroy the labor unions and the other was to maintain the free market. Keynes despised the American Keynesians. His whole idea was to have an impotent government that would do nothing but, through tax and spending policies, maintain the equilibrium of the free market. Keynes was the real father of neoconservatism, far more than [economist F.A.] Hayek!”

….Keynes completely understood the central role of profit in the capitalist system. This is one reason why he was so strongly opposed to deflation and why, at the end of the day, his cure for unemployment was to restore profits to employers. He also appreciated the importance of entrepreneurship: “If the animal spirits are dimmed and the spontaneous optimism falters … enterprise will fade and die.” And he knew that the general business environment was critical for growth; hence business confidence was an important economic factor. As Keynes acknowledged, “Economic prosperity is … dependent on a political and social atmosphere which is congenial to the average businessman.”

….Indeed, the whole point of The General Theory was about preserving what was good and necessary in capitalism, as well as protecting it against authoritarian attacks, by separating microeconomics, the economics of prices and the firm, from macroeconomics, the economics of the economy as a whole. In order to preserve economic freedom in the former, which Keynes thought was critical for efficiency, increased government intervention in the latter was unavoidable. While pure free marketers lament this development, the alternative, as Keynes saw it, was the complete destruction of capitalism and its replacement by some form of socialism.

We have yet to see an incisive critique of Keynes based on understanding he was a shameless oligarch with no regard for republicanism, if not outright antipathy to republicanism. Bartlett’s jab at the greatly idealized Keynes would be much more powerful if Bartlett understood the tensions and contradictions inherent between republicanism and capitalism.

Open Thread

As usual, feel free to use the comments to discuss topics unrelated to recent posts.

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