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

Month: December 2020 Page 1 of 4

Plus c’est la même chose


Jeremiads notwithstanding, it appears that Biden’s strategy of appealing to Trump-disgusted suburban voters worked. At the US presidential level, at least, left-populists and Sanders supporters proved to be essentially irrelevant, politically. The Democratic consultant class has had its biases confirmed. What is, haha, left to the left-wing populist is to double down on the jeremiads: to predict that in the future, the inevitable failure of now-successful beige neoliberal centrism to reinstate its heavenly mandate in the USA will result, down the road, in the election of a smart fascist/right-populist Man On Horseback, if we’re luckymerely a Viktor Orbán figure or suchlike for the American context — or worse, possibly much worse.

This reasoning seems very plausible to me. Because it is true that unless the neoliberal establishment has a change of heart, Bidenist/Obamaist US leadership will not be able to turn the ship around from an on-going trajectory of national and global decline. And insofar as that decline is felt in shrinking living standards, and insofar as “beige centrism” manages to suppress left-wing alternatives, the population will likely turn to forceful/violent right-wing populism, and all the inherent divide-and-conquer grifts that right-wing populism brings with it alongside the nationalist emotional highs and the “sugar rush.” As I said, it seems very plausible.

One of the bad habits of neoliberal intellectualism is an excessive reliance on “counter-intuitive” explanations as exemplified by the once-popular book Freakonomics.   We should be rightly suspicious of narratives that tell us that things we view in common-sense terms as bad are actually good. Sometimes counter-intuitive explanations like that are valid, but only sometimes. But we should not fall into the reverse trap and always uncritically accept simpler explanations that happen to match our moral intuitions. A common left-wing moral intuition is what I explained above: A people increasingly deprived of access to the good life and unable to access progressive responses to that deprivation will eventually provide reactionary forces a breakthrough. It has, after all, happened before.

It is the implied determinism that we should view with at least a little bit of suspicion. First of all, although we should heed history’s warning signs, history actually does not truly repeat reliably, and context matters. Trump’s senility and incompetence was, in point of fact, part of the Trump political brand. It was the riposte to a failing elite in a time when elite “competence-signalling” was part of the elite self-image. The specific trajectory to the “competent Trump” is much harder to fathom, when the incompetence was specifically a part of what he was and still is lionized for by his most ardent followers.

If we leave aside the typical and easy materialist determinism that thrives particularly on the more left end of the spectrum and accept a little bit of “counter-intuitive” reasoning, a different picture emerges. One in which the success and failure of Trump was highly dependent on circumstances over and above material discontent, circumstances that are difficult to line up again.  Circumstances in which the very competence of the future feared competent fascistoid is one of the features that prevents his (or her) rise, just to give a possibility. One in which the bad memory of Trump is sufficiently mobilizing for a long enough period of time that the mainstream neoliberal centre is protected from attempts at overcoming it.

In that world, between every election, things just keep getting worse and worse. And yet, the process of coalition building in a complex society given the American political system simply throws up Biden after Biden, Democrat or Republican. Decline centrism, unending. Like Tyler Durden’s vision in Fight Club, with people drying meat on the asphalt of a ruined highway, except they’re still arguing over whether they should choose the chieftain with the red trim or the blue trim as head chieftain, out of fear that one of them might reduce the incentives created by the fear of winter freezing by their proposed “peltfare” program.

Imagine this future: the soft, dirty sole of a comfortable white Reebok runner gently stroking a human cheek — forever.

Why Larry Summers MUST Believe $2,000 Checks Are a Bad Idea

Larry Summers, the man who is reliably wrong about everything, came out against a $2,000 check for Covid release.

It’s worth examining why, because Larry is an economics exemplar, and what makes him different is not being wrong about almost everything, it is being willing to shoot his tweet off about it.

That chart indicates there is no problem: The economy is on course, and fine. A $2,000 check for everyone will “overheat” the economy.

Larry Summers, 2013

Larry Summers, 2013

There are three problems with this. The first is believing the numbers mean much of anything. Disposable income is one of the hardest things to calculate; there is a lot of guessing (called modeling) involved. We don’t actually know what everyone’s expenses are every month, and worse, we don’t know which ones they haven’t been keeping up on. If you give someone an extra $2,000, and they spend it on rent or paying down their credit card or student loans or mortgages, it turns out it wasn’t disposable income. Nor can you be sure what will happen to savings when you give someone a (small) cash windfall: They may save a fair bit of it. (The “marginal propensity to save may change to use econospeak.)

So +2,000 may not increase spending: We don’t know how much will go to savings and to debt repayment or other expenses.

The second thing is the idea that a one-time $2,000 windfall actually matters much. Even if it did all go to disposable income and get spent, so what? It’s a blip. Pricing and inflation decisions are made on longer term expectations, far more than on windfalls; if prices rise, they’ll fall back immediately. It’s a yawn.

The third is the great failing of neoliberal economics: A refusal to deal with distribution. Back on December 10th, a story claimed that 11.4 US households were $70 billion dollars behind on rent, averaging $5,000 each.

A story in November had the number of people behind on rent at 40 million.

The stories for people behind on mortgages and student and credit card loans are similar. More people are homeless, and so on.

Aggregate income is fine, in part because of UI extensions, but also because Covid has seen a redistribution of income and wealth from the poor and middle class to the rich.

Everyone’s not OK. Tens of millions of people are in a bad way. In California, something between 40 to 50 percent of small businesses are in danger of closing and when some of them (be optimistic, say half) do, those jobs will go away.

So, let’s go back to Summers. He sees an aggregate economic number known to be unreliable, and assumes that it is reliable in a pandemic. He assumes that people will spend all the money, thus “overheating” the economy, rather than using it to pay off debts (to people who probably are also in over their heads and thus will not be spending much) or saving it. And, he doesn’t take into account the fact that aggregate personal disposable income, even if accurate, is an aggregate figure. Or perhaps, being generous, he assumes UI and other programs catch it all (if they did, we wouldn’t have all those people near eviction or small businesses near bankruptcy).

Summers lives in an imaginary world. He lives inside models and statistics and assumes that, combined, they represent the world well. The statistics often don’t, the models are often garbage, but a man who has dedicated his life to neoliberal economics cannot, indeed must not, see that, because if he admitted it was true, his entire life would be based on a lie.

So, the numbers are fine, the models are fine, and giving people more money will overheat the economy. It must be so, or Summers is a fool who has wasted his life, however much money he may have made.

Indeed, if he were to go down that rabbit hole he might realize that he helped cause the financial crisis with securities deregulation and didn’t see the housing bubble and so on precisely because he believes nonsense models and facts. Which would mean he has done great harm, and that a reasonable person who didn’t believe a bunch of nonsense wouldn’t have done all that harm.

So, the numbers are fine, the models are fine, and people don’t need $2,000 checks.

(Aside: I am given to understand by a friend who knows Summers well, that he is in fact, in terms of raw processing power, brilliant. I note that raw processing power, as my friend Stirling Newberry once pointed out to me, just gets you to the wrong conclusion faster if you don’t have judgement.)

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Effects of the New 60 Percent More Infectious Covid Strain

Cases have been found outside of Britain, including in the US and, ironically, France (slammed the door too late.) The practical result of the increased infectiousness are discussed by Tomas Pueyo.

The points are, as you’d expect, that it increases the speed of exponential growth. If it becomes the dominant strain (and it almost certainly will, because it grows faster), you have to really lock down. No sham lockdowns, people don’t go out for anything but food (maybe you even deliver that); schools are closed, no one works outside the house unless they truly are an essential worker.

Herd immunity now requires 75 percent+, not 60 percent of the population. That means it will take longer, and with respect to vaccines, people will need to be convinced to take them, or if necessary, forced to.

Countries that already got Covid-19 under control, like Vietnam, New Zealand, China, and Taiwan (notice a trend?) will be fine. They just keep tracking and tracing; keep quarantining visitors, and keep clamping down hard on even a hint of a break-out. Those of us who haven’t, like most of Europe, the US, Canada, Brazil, and so on, can either get serious RIGHT now and close schools and go to a real lock down, or we are going to have to wait for vaccine immunity, which may take until the end of 2022 depending on how many doses your country is getting and when (and if people will take them, or be forced to).

In general terms, my sense is that the first half of 2022 is going to be worse than 2021 in countries that have fumbled Covid, after that things should start improving noticeably.

This was a pro-active choice by our elites: They decided not to handle Covid. It was handled in many countries, the playbook is known to anyone who cares to know it just by seeing what was done or reading a 101 textbook, but “fumbling” Covid made elites in countries like the UK, Canada, and the US a lot richer and more powerful, so it was allowed to rage through the population and destroy the small business economy so that those who were able to stay open, like Amazon and Apple, and so on could grab huge amounts of market share.

Grandma died and young people got life-long heart problems so Jeff Bezos and private equity scum could get richer.

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Week-end Wrap – Political Economy – December 27, 2020

Week-end Wrap – Political Economy – December 27, 2020

by Tony Wikrent

Strategic Political Economy

[Twitter, via Naked Capitalism Water Cooler 12-21-20]

People always ask why poor people don’t just revolt and burn shit down. As a poor person I can say with confidence its because there is a startling amount of people cool with shooting us down like animals

It’s the economy ideology, stupid: 

What a Miserable 2020 Revealed About America

Paul Waldman, December 21, 2020 [The American Prospect]

It exposed an impotent political system, a deadly mythology of rugged individualism, and a Republican Party without shame….

Our individualism is deadly. In no other country were the simple public-health measures necessary to contain the coronavirus so quickly and easily politicized. Trump bears much of the blame, but it didn’t take much for him to convince people that wearing masks is a terrible imposition on their freedom, and that it could be a worthwhile emblem of political identity. So many of us have spent our lives steeping in the ideology of “rugged individualism,” learning that any government edict is inherently repressive and making a personal sacrifice for the good of your neighbors, even a tiny one, makes you weak. No quantity of dead Americans has managed to dissuade so many of us from believing this.

Yep, it’s definitely the ideology, stupid: 

Neal Katyal and the Depravity of Big LawThe Democratic lawyer’s sickening defense of corporate immunity in a Supreme Court case reveals a growing moral rot in the legal community.

Merry Christmas

I hope you all have a good one. If you don’t, and many won’t, my condolences and best wishes that the next year is a better one for you.

Trump Outflanks Dems from the Left

So, as you’ve probably heard by now, Trump is opposing the Covid “stimulus” bill and asking it be amended to include a $2,000 check, not a $600 one. Pelosi says he should pass the bill then they’ll pass another bill with the extra $1,400 (which is a ludicrous lie and we all know that).

The cries from many liberal supporters of the bill are that it is a good bill because it includes unemployment insurance relief increases of $300 a week. That’s sort of true, it’s the main good thing in the bill, but the problem is that a lot of people who need help aren’t currently getting UI.

Trump’s simply right about this, whatever his motives. Moreover, throughout the year he’s fairly consistently advocated more relief than Congress has provided.

But the standard play is unfolding. Screamed warnings that if the bill doesn’t pass no one will get relief, and that if it isn’t passed by the 26th, 12 million people will go off UI, so pass the bill, even if it’s inadequate. “We’re giving you something, in a bill packed with pork, and that’s not nothing, so take something.”

This is based on standard economic-neoliberal thinking. There’s a little decision game about it. You and another person are given a hundred dollars. The other person decides how the money is split. You can’t change how it is split, but you can veto getting any money.

The theory is that even if the person deciding how the money is split offers you a cent, you should take it. After all, you’re better off, right? In the real world, people don’t do that. If the split gets too low, they veto any money.

This is correct if you are dealing with a situation where the “game” will be played more often than once. If you don’t do it, you get a cent each time, and the other person gets almost all the money.

The correct action is a veto.

It’s why the Squad should have taken down Pelosi if she didn’t meet some essential demands — to show that they can’t be bullied, and that they have to be dealt with. If you wont use whatever power you have, you have no power, and you get nothing but table scraps.

In this sense, Trump is able to be “wrong” because he’s lame duck now. If he was going to be around for another four years, this threat would have real power because he could gum a lot of things up and he could insist those 12 million people be put back on UI (it’s not like an amended bill couldn’t do that). Biden is very unlikely to veto such a bill.

But he’s not wrong that $600 checks are too little and an insult. That’s not even a month’s rent for most people.

And if he runs in 2024, a lot of people will remember this attempt to get them more money as his last fight.

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A Brief Note on the New Covid “Stimulus” Bill

So, the bill that looks likely to pass is 900 billion. One $600 check, $300/week in UI improvement (this is the real good thing in the bill) and some miscellaneous good stuff, along with a variety of pork.

It’s a bad bill, totally inadequate to the circumstances. In the new year, millions of Americans will become homeless. It’s hard to say exactly how many, but ten million would be a low end estimate.

There is insufficient support for States and cities, so there will be a round of savage austerity cuts in the new year, given the complete refusal to actually tax rich people.

In many ways, 2021 is going to be WORSE than 2020 for Americans. About a third of small businesses will likely go out of business, the big winners like Amazon will not hire enough people to make up for it, and the end result will be a shittier economy than in 2019 concentrated in fewer hands.

Meanwhile, in London, England, a new Covid strain has appeared that is twice as contagious as the original.

None of this was remotely necessary. Proper support for small business and people would have cost less than the financial crisis bailouts (and could mostly have been done through the Fed for “free”), while the pandemic itself could easily have been crushed in about six months by simply following the same playbook that places like Vietnam used, a playbook that is simply “follow the textbook.”

But, in the US, the UK, and Canada, and I suspect a lot of other nations, Covid-19 has been a huge boon to the rich, vastly increasing their wealth and power. So, well, why save lives and jobs? I know I’ve said this repeatedly, but it’s a point that bears repeating.

You’re getting scraps, while the rich feast, and the politicians tweet selfies of themselves getting vaccinated before ICU nurses and doctors.

It’s how this part of the world runs. But not how it has to.

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Fundraising Finale

We did, in the end, raise slightly more than $11,000. I am very grateful, this will make a significant difference. Thank you, all who gave.

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