Category Archives: Politics

Should we all be optimists or pessimists?

Steven Pinker, a Harvard psychologist and author of Enlightenment Now: The Case for Reason, Science, Humanism, and Progresszooms back and examines the “big picture of human progress” since the late 18th century, right around the time the Enlightenment Age kicked off. Pinker highlights the data on education, literacy, wealth, and longevity to make the broader case that life, is good and getting better.  He’s sort of the anti-Lester Thurow (circa 1983).

Global economic prosperity proves his thesis that science and reason have saved the day, but what if that prosperity is an illusion?

Pinker suffers from what I’ll call the jealous neighbor fallacy.  You are living on a street where all the houses are of similar value and design. Everyone has 1.5 children and a minivan. One day you notice your neighbor (Joe Blow) has a new Mercedes S550. You finally decide to confront him. You ask whether he got a new job or a huge raise. He tells you that nothing has changed, he simply leased the car with no money down. The dealer seemed more than happy to make the deal.

Then it gets worse – your other neighbor gets a new Tesla S, again all financed through the dealer. From that point on your wife and you wince a little as both your neighbors cruise around in high-class cars so everyone can see them. You feel like the poor people on the block. One day you go out to pick up your paper from the street and Steven Pinker is outside congratulating Joe on his financial good fortune.

The error that Thurow made was to never imagine we would borrow our way to faster growth. Ronald Reagan got us going and George Bush Jr. took it to a new level. Pinker doesn’t pay attention to the balance sheet – all he sees are the near-term benefits.

These numbers are extraordinary. This debt has allowed us to both stimulate our local economy but also those of our trading partners. They lend to us and we voraciously buy all their crud. We have lifted all boats which is why Pinker’s global averages look so marvelous. But that’s not all. Other countries have followed our lead just like neighbors copy neighbors when it comes to borrowing to buy new cars. Here’s what China has done:

Every time you hear Larry Kudlow brag about GDP growth you must balance it against the giant annual deficits we are currently running – 10 years after a recession, precisely when we should be running huge surpluses. Do we feel richer? Yes. Crime is lower, longevity is rising (sort of) and global poverty has fallen (mainly due to Chinese growth). If this were being achieved by virtue of rising productivity then we truly would have much to celebrate. (It’s not)

Unfortunately, if we look into the future using Pinker’s time frame this doesn’t end well.

Why do I feel so smart?

There is a name for the syndrome that many not-very-smart people suffer from: The Dunning-Kruger Effect (DKE). It’s easy to understand. People of limited intelligence don’t really know how much smart people know so they simply presume they are clever(er). This is how people with no understanding of how carbon dioxide absorbs or traps heat from the sun can be so sure that global warming is a hoax. They refuse to accept the opinions of experts because to do so is to lose agency. Besides, all those academics are liberals anyway. Ah – to be blissfully ignorant.

Today we have moved to the second level of DKE. We are led by a man and his cult members who suffer from DKE, not just a little, but with regard to every political and economic issue of the day. I may not understand many issues in as much detail as I should and I have never worked in government, but I am utterly certain that I am smarter than Donald Trump, his entire cabinet and every politician who comes out defending him. Need I produce a list of his stupid remarks?… OK, maybe just a few:

  • After arriving in Israel from Saudi Arabia, Trump told his hosts, “We just got back from the Middle East.”
  • Trump said that Frederick Douglass, who died in 1895, was “an example of somebody who’s done an amazing job and is being recognized more and more.”
  • He claimed that Andrew Jackson, who died 16 years before the Civil War, “was really angry that he saw what was happening in regard to the Civil War.”
  • Trump picked a fight on Twitter with Qatar, apparently not knowing that this small, oil-rich emirate is host to a major U.S. air base that is of vital importance in the air war against the Islamic State.
  • Donald Trump said climate change is a hoax invented by the Chinese.

I could go on and on. His defenders seem even worse somehow. How does a Republican congressman claim to be lucid while defending such an idiot? How can a good economist defend Trump’s trade policy when it has no coherence? Who thinks it’s a good idea to invade or nuke Iran if they make one more threatening remark?

Every day my own feelings of superiority are enhanced by his latest tweet. I have become a smarter man due to DTE– the Donald Trump Effect. A person with debilitating DKE has pushed up my intellectual confidence so much that I am absolutely ready to destroy all comers (as YouTube and Twitter call it). It’s as though someone just handed me a PHD in everything and I never needed to take a single course. All I have to do is listen to the news each morning and I am bursting with confidence in my intelligence…

Go on – ask me anything.

 

 

Does John Roberts care about the arc of history?

Let’s assume for a second that the head of the Supreme Court cares about his historical reputation. Clarence Thomas and Sonia Sotomayor don’t have that sort of pressure. They just vote their conscience and sleep like babies but eras in the court are described by using the chief justice’s name. Each one becomes most famous for it’s most significant decisions and the historical judgment falls most heavily on the chief – as if his name is on the stamp, even if he voted against the rest of his colleagues.

A  minister (Theodore Parker) in the 19th century once said:” The arc of the (moral) universe … bends towards justice.” – which I think means that the world gradually becomes a more liberal place where human rights gain favor and religious orthodoxy declines. If you were a justice on the court that voted in favor of returning runaway or freed slaves to the Confederacy (The Dread Scott case) then history has judged you harshly. If you voted against civil rights or voting rights or access for all to education then history has raked you over the coals. In fact, it’s rather hard to think of a conservative decision that has been judged as wise and good for the country.

You might point at the court’s shutting down the New Deal as a Presidential overreach: The Supreme Court consistently rejected laws giving the federal government authority to regulate industrial or agricultural production—FDR’s efforts to protect workers, raise employment, and lift farm incomes. FDR had won huge majorities in 1932 and ’34 and the people were all behind the New Deal programs. If FDR hadn’t tried to stack the court in retaliation this would have gone down as just another decision(s) by the court to favor big business, the donor class or retrograde ethical positions. Desperate times demanded desperate measures.

The Supreme Court has upheld segregation, supported the internment of Japanese Americans, found in favor of forced sterilization of people with disabilities, upheld sodomy statutes, told states they cannot ban child labor, stopped the recounting of votes in Florida in 2000, protected Exxon from punitive damages in the crash of the Valdez, and of course – found that corporations deserve the same protections as people when it comes to political (free) speech.  If we just singled out the voting record of the conservative justices we would be appalled by their votes. Conservatives, in particular, are often the most behind the times when it comes to individual freedoms and equal rights.

The United States is becoming unequivocally more secular and more open-minded towards minorities and LGBT people. This is not new – this the arc of history and if the Roberts court chooses to go crazy conservative with Gorsuch, Thomas and now Kavanaugh leading the way, they’ll find that history will judge them as backward dupes of the aged and the rich. Is that how Roberts wants to be known? Is he willing to hear it said that “the Roberts Court blew up the right to an abortion”? Is he happy that his court has chosen to empower corporations to the detriment of citizens and that it has done nothing to fix the national gerrymandering crisis? After Kavanaugh gets approved, we must hope that Roberts has some historical perspective and takes on the job of the adult in the room.

It’s his reputation at stake.

The Cultists Take Over

Cognitive dissonance is aggravating. We all cling to our beliefs like sacred possessions. To change an opinion is to lose a piece of oneself. If we start with “I love Trump” then we’ll do almost anything to sustain and defend our love. Communists were told that Nazism was their enemy in the 30’s so they sided with the allies against Hitler’s rise. Then they were told that Hitler was a great guy (after the signing of the Molotov-Ribbentrop Pact) . After Hitler invaded the Soviet Union in 1941 communists had to pivot yet again. Did any of this hurt Stalin’s popularity or that of communism in general – not really.

Trump hates Kim Jong Un. Trump loves Kim Jong Un. No problem. In fact a cultist will get angry at your attack of all this flip flopping and dig in even more. Kim Philby never wavered, why would our alt-right? Along the way a party will veer away from being political to being all about the great leader. It happened in China (under Mao), in Stalin’s Russia, in Mussolini’s Italy’s,  and in Chavez’ Venezuela.

The one rule you cannot break in a  cult is – never doubt the leader. If you disagree with him then you will be thrown out (“primaried”) . When you make your case on ideological grounds the cultists (now called the base) will not hear you, They’ll just get really really angry. Eventually this works to improve the popularity of the leader as the party purges non-believers. The more stupid or outrageous the actions of Trump, the more the cultists dig in so his popularity rises and the party becomes “purified”.

We know how this ends – in total failure. Stalin is denounced, Mussolini is hanged, Venezuela goes bankrupt and there is mass emigration. There is usually a very ugly period when the cultist know they’re going down and they ty to take down the others with them. Hitler youth often stayed in the rear to kill retreating soldiers.

Americans were trained to believe in a process (democracy), a set of rules (the constitution) and a system (capitalism) so it was thought that cultism was not something we would or could succumb to. Our flood of immigrants (the highest number of foreign born people since 1920) has changed the dynamic. Ethnocentrism is a powerful ugly force. It must be attacked explicitly but also implicitly – by reducing immigration to allow for integration and economic digestion.

In the meantime we can only hope that the radicalism of the Trump fanatics irritates the middle and the “old” Republicans sufficiently to ruin him in November.

What does the past tell about Vichy-Republicans

Every Republican primary is telling us that the party now belongs to Donald Trump. Mark Sanford is the latest casualty that explains why only retiring congressmen are denouncing the liar in chief. This is a common story in history. When a strongman takes over a party or a country, other politicians must fall in line to survive. Many do so willingly and with fervor. Many do so for economic benefit and some – when it is entirely unnecessary.

After the strongman has been discredited or thrown out of office the sympathizers must rewrite their biography. They create a narrative where they had no choice and were just following orders. If they can, they erase the records – something the internet won’t allow any more. Francois Mitterand’s participation in the Vichy government was (kept) murky until the mid- 90’s when he was retired. It was common knowledge that many ex-Nazis were allowed back into the government after the war. The US intelligence services recruited war criminals and many businesses that had prospered during Naziism carried on shamelessly after the war (Chanel, L’Oreal, Hugo Boss, Volkswagon/Porsche).

In five years time Trump will be gone and (I hope) so will be his doctrine of alternate truths, spin, and stupidity. The whole mess will look even worse in the rearview mirror than it does in the present. Yes, I’m assuming we will get a counter-reaction. The un-Trump will force those collaborators to act like former Quisling cabinet members. They will spin like Maurice (I had no choice) Papon. We will be told by Mitch McConnell that he had no choice or couldn’t have done anything anyway. Perhaps Devin Nunes will evaporate without repentance (like Oswald Mosely) but long-serving Senators and new candidates will need to pivot to be re-elected. They will selectively recall their un-Trump moments.

How does history judge loyalty as an excuse? 

History tells us that allegiance to a repugnant narcissist/ideologue is not easily forgiven. Usually, these collaborators must spend some time in the wilderness before their resurrection. Memories fade.  Paul Ryan bankrupted the state and accommodated the Trump agenda. He can see there will be fallout. Like a Nazi who saw that Germany was losing the war, it’s best to get out early, deny your complicity and stage a comeback later. If you wait long enough and hire a good publicist you might become a celebrity like Albert Speer. If possible align yourself with a new cause or a clean politician.

The Republican ticket for 2024 – Paul Ryan/Jeff Flake

How to Win a Trade War

I believe we have been in a trade war with China for 20 years. They have been fighting every day and gaining ground. We have been acting like Stalin at the beginning of Operation Barbarossa – mired in disbelief and incompetence. It was so much easier to think China was just giving us what we wanted (cheap consumer goods) without any cost to our own economy or security.

Thanks to Trump many more Americans and even economists are recognizing that we have been taken for a ride. There are confessionals everywhere; Few who now defend China in light of such public documents as Made in China 2025. This seems to have sent Trump and his team into a sort of frenzy, attacking every country as though it’s China. He even attacked a country that we have a trade surplus with (and there aren’t many of those) – Canada!

Memo to Trump: How to Conduct a Trade War

  1. Set an example by attacking the leader of global trade crime – China. (Let’s give a big shout out to Marco Rubio for this bill.)
  2. Clearly explain why it has been singled out so others know what the new rules are.
  3. Attack transhipping to prevent new tariffs against China from being circumvented.
  4. Pick a favorite country to use as an example of good conduct – one that has a deficit with us ideally and who we can trust under any situation to deliver needed goods in case we have a (military or trade) war. Canada or England will do. Celebrate their fairness.
  5. We must use tariffs and subsidies in case the spinoff effects of higher prices are too costly. Some combination of the two makes sense with steel, solar panels, and LCD screens.
  6. Make sure critical inputs like rare earth metals and pharmaceuticals are stockpiled or brought in only from friendly sources.
  7. Someone call up Peter Navarro and tell him you can’t win a war without allies.

Trump is right about one thing – every country in the world has been targetting debt-loving, consumption-crazy Americans. We have been in love with policies that favor consumers over producers/workers for thirty-five years.  It is a shock to wake up and be told that something you buy or use as an intermediate good in your business may go up in price. For every other country in the world, that’s a normal day. Everyone (except in America) pays extra for something, knowing they do so to grant a higher wage (or social service) to a neighbor. That’s why they accept higher tax rates and/or a VAT.

Surely Americans can see the absurd place this has gotten us – we have a (fake) unemployment rate of 3.8% and wages are barely keeping up with inflation. There are a ton of unfilled jobs out there – at Chinese wage rates! Corporate outsourcers have reset the price on domestic labor. Unless we break with the global trade parasite we shall continue to circle the drain with huge tax shortfalls and an opioid epidemic.  The war has begun and we must all be drafted to pay something for our safety, our sovereignty, and higher wages. We should accumulate allies to fight with us – sing along with me: Oh Canada (… or God Save the Queen).

Let’s not continue to act like Stalin in 1941.

A Moron with a Flashlight


The United States just ended its first session of trade talks with China. In theory, this is supposed to be a negotiation where China confesses to voluminous trade crime and the United States walks away with big concessions. No confessions or concessions will ever be made. So what’s the point?

Simply having these talks opens up the subject within the United States. Free trading globalists who consider themselves to be more moral than protectionists are forced to answer reasonable questions like:

  • Does China steal American intellectual property?
  • Does China require all American companies to set up partnerships with Chinese companies if they want to produce goods for the Chinese market?
  • Does China block Google, Facebook, and Microsoft from their market or are these companies simply unable to compete locally?
  •  What is the “Made in China 2025“ initiative?

It is virtually impossible to respond to these questions without conceding that China is engaged in rampant protectionist behavior.   The question then changes: Are we OK with trading with China on their/these terms? This is big progress.  For the past 20 years trade with China has been called “free“.   American presidents going back to Bill Clinton have sought popularity by facilitating unlimited imports of opium (cheap consumer goods) from China. We have been in a consumption stupor, unable or unwilling to see the costs.

My sense is that even the most liberal media outlets who want to denounce all Trump initiatives are really struggling with the narrative surrounding these talks.  They have changed their argument [weakened it] to excoriating steel tariffs but they know that such denouncements don’t address the greater problem. Fine, steel tariffs have a poor return, so how (else) do we fight back against dumping?

This situation is so outrageous that even Donald Trump can’t soil it by association. He still may screw it up with inappropriate policy but the genie is out. It’s hard for me to see politicians coming out in favor of globalism and its embedded free trade beliefs ever again. They may eschew populism as pandering to xenophobes but they see the merit of this trade fight. Authors like Ian Bremmer and Robert Kuttner are on the circuit offering intellectual support. Even The World is Flat – guy – Tom Friedman issued a sort of mea culpa last week! Up to now such voices were mute.

The hard part is still ahead of us – applying good policies that may raise the price of that 4K TV you wanted. We need to swing the pendulum back toward workers and away from consumers or else we will continue to see zero (real) wage growth forever (regardless of how low the fake unemployment rate goes.).

The Impotence of Millennials

Historically the norm was for people to have more children than was needed just to replace themselves. Maybe they were always over-estimating the risks of infant mortality and disease. Having many children was a sort of luxury or a way to find happiness in a wretched world. A somewhat irregular cycle developed where some generations produced huge baby booms and others produced baby busts but in general more younger people was normal.

When there are more young energized people they feel the power of their number. They push for economic and cultural change that suits them. They object to their elders lining their own pockets at the expense of future prosperity. They object to meaningless wars that they, the young, are sent to fight. They rebel against traditional superstition and backwardness. They promote new technologies and science because they find it all easier to learn and accept than their parents. It’s Rob Reiner versus Archie Bunker.

In spite of their low numbers, we hear from millennials through modern media. We know they favor science over religion and equal rights for gay people and minorities. Young people don’t question evolution and climate change. But a crowd seems to sense when it has the necessary numbers. It’s also aware of its own demographic impotence. They retreat to Instagram instead of running for office. Voting is a pain. Social media has become an opiate but it wouldn’t be if they had power in numbers.

In the early 60s university students were utterly quiescent. They were almost completely absent from the civil rights fight of Martin Luther King. That fight was made by African-Americans and was advanced by the new generation’s parents. Can you imagine the riots and demonstrations that would have been put on by the boomers of the late 60s if they had watched George Wallace block black students from gaining entry into the University of Alabama? Would the Berkeley university students of 1971 completely ignore the inexplicable worthless invasion of Iraq? There was no reason to protest against the Vietnam war in France but that didn’t stop the students from rioting in Paris in 1968.

For society to progress it needs the citizens who care most about the future to speak up. If they don’t then the donor class will steal and loot from the treasury. Government debt will grow to the sky. Jobs will all be sent to China. Shamelessness and lying will become the norm. The wealthy and politically powerful will act with impunity since they know that the pathetic millennials will do absolutely nothing.

Letting in immigrants to make up for our shortage of babies does nothing to solve this problem because these people have no political franchise. In fact, their desire is to not be heard at all (other than on immigration issues).

Donald Trump is just another example of the looting of the system by the aged.  Congress is full of ancient baby boomers and people who are old before their time.  Paul Ryan‘s counterpart is a Columbia University student in 1970 with hair shorter than was the style in 1955, who feels that rock ‘n’ roll music is the product of the devil.

He betrays his own generation and the future of the country, to get a pat on the back from Archie Bunker.

Democracy Loses Popularity

There are a lot of new polls that show that people [especially millennials]  don’t seem to be as committed to democracy as their parents or grandparents. This is logical since the end of the Cold War means we don’t have a nemesis who favors the alternative, totalitarianism.  China is the other reason:

Our current greatest economic competitor is China and it seems to be winning some of the hearts and minds of our people. Even though it is nothing more than a global economic parasite it preduces a tremendous amount of propaganda devoted to celebrating its burgeoning economic success. It publishes  spectacular growth statistics and suppresses all dissenting voices.  It manufactures most of the consumer goods we buy every day. How can such a bad place with bad people make all the toys and clothes we love?  Apparently their version of totalitarianism seems to work quite well.

On the other hand we have perfect proof that democracy is failing because we have elected a brainless narcissist to be our president. This juxtaposition naturally supports the thesis that a competent  dictator is better than an elected  idiot.  Democrats revere China while Republicans revere Russia.  Consumerism has defeated economic nationalism in such a way that people look to Apple Computer for guidance rather than their political leaders.  FIfty years ago Dell Computer would never have considered Cuba or the Soviet union as places to locate offshore production to take advantage of lower wages. They would’ve been pilloried both for offshoring and for being pro-communist. (Their goods would have been stopped at our border.)

Yes, the cold war is over so such fear and paranoia would be misplaced in today’s world. But we have a new adversary – one that is utterly ethnocentric and unpredictable. They suck our blood, suppress free speech, block our exports and we love them because iPhones are cheap.

If their products are so good, how bad can their political system be?  Or to put it the other way, if we seem to be economic losers then maybe our political system needs to be reworked a la Hungary or Poland?  Nationalists are Nazis now so  sovereignty is bad and globalism must be good. Manichaeism works.  Ironically, the countries whose political systems we revere are completely nationalist in nature. You can’t hate the alt right and be indifferent towards democracy, just like Germans couldn’t embrace Hitler and free speech.

The problem we have is that Chinese totalitarianism and highly controlled economy is succeeding with regard to its primary goal – catching up to us. Yes they have a terrible maldistribution of income but so do we. Our economists detest government ownership of industry but when it comes to China they’re OK with it. Young people see these mixed signals. We can’t pronounce our love of freedom and congratulate Putin on his election victories. We can’t abhor protecting our own steel industry while looking the other way when China protects all its industries.

Every new American college graduate should be made to spend a week wearing a gas mask in Shanghai – then we should hear less about their indifference towards democracy.

Horizontal Demonstrations

When a march is organized through an internet app like Facebook or Twitter many people hear about it and approve. Many may actually go a city center and walk around with clever placards. At the end (whatever that means) they normally disperse and nothing tangible is achieved. There may be some speakers at the end or the beginning who one might recognize, but usually, it’s not about the speakers. It’s a form of passive/aggressive self-expression. This is called horizontal organization.

In the past, (before social media) there would be a particular leader or group of leaders who would announce they were going to make an address to fellow believers at a convenient urban location Think- Martin Luther King (I have a Dream speech in Washingon), Tom Hayden’s anti Vietnam war speeches or Gandhi’s salt march. After the people dispersed the leaders carried on with the cause, meeting with lawmakers and appearing on TV or getting arrested. They pushed for new legislation and they sought out ways to expand their following. Such gatherings are considered examples of vertical organization.

The results of the former are mixed at best. Take for example the Arab Spring. These were almost always horizontally organized and in the end, they achieved nothing. There were no anointed leaders to stand up to take on the existing corrupt governments after the crowds dispersed. There was no plan because crowds can’t plan.

Try to imagine a different march in Washington against guns. Instead of it being a sort of mass wandering, it was to stage a speech by Barack Obama to raise money for a new lobby group called Americans Against Guns. He would speak at the Washington Mall and follow up with crowdsourced funding a la Billy Graham. What a show it would be! Then Barack could fly to Chicago and Los Angeles and do it again. There would be huge crowds to hear his soaring oratory. The money would pour in and it would be used to defeat NRA supported candidates and bills.

Instead we have a few well intentioned high school students tweeting about the college admission results. Does anyone think this  works? It’s time to go old school vertical. Twitter and Facebook will never get the job done on their own.

And our best player is sitting on the bench.