ChiMerica 4 18 May 2020.

For decades, both foreign policy experts and business leaders saw China in a favorable light.  They expounded their views to American voters.  Opening China to capitalism and world markets would integrate the Asian giant into the global economy to the benefit of all.  At the same time, capitalism would raise billions out of poverty while spawning a middle-class, the historical driver of democratization.

“Outsiders” long dissented from this “elite” view of China.  They claimed that China rigged its domestic market to exclude foreign products, subsidized Chinese companies competing on international markets, and ruthlessly stole intellectual property.  One effect came in the massive out-sourcing of American industrial jobs and manufacturing in the wake of China’s accession to the World Trade Organization (WTO).  They claimed that China remained a one-party state governed by and for the benefit of the Communist Party.  They pointed out that economic power converts readily to military power, while China advanced supposed “historical” claims to territory beyond its current borders.

Now the “elite” view has lost traction.  American public opinion has taken an increasingly critical view of the Peoples’ Republic of China.[1]  Already in 2019, under the shadow of the tariff war with the United States, the brutal repression of the Uighur minority, and the crack-down on pro-democracy forces in Hong Kong, 57 percent of Americans took an unfavorable view of China.  In February 2020, the unfavorable view had risen to 67 percent.  There is little difference between the political parties in their perception of China as a threat to American interests: 62 percent of Democrats see it that way, leaving little daylight between them and the 68 percent of Republicans who feel the same way.

As a candidate, Donald Trump loudly expounded the anti-China “outsider” view.  As President, he followed his campaign words with presidential action by slamming severe tariffs on China and harshly criticizing it behavior.  Now the United States is in the midst of a coronavirus-induced economic collapse that has undone all the progress that took place during the first Trump administration.  Now the country is desperately short of the personal protective equipment that American companies produced at home in days of yore.  Now many countries, and not merely the United States, are criticizing China for a lack of transparency in the early days of the coronavirus outbreak.

 

How vulnerable is China to external pressure?  China faces grave economic problems.   Its drive for industrialization overshot even the huge demands of domestic and export markets, leaving it saddled with excess productive capacity.  Its long construction boom has achieved the same thing in terms of office space and housing, leaving a property bubble.  Both were financed by excessive government credit channeled through banks that are now on the verge of insolvency.

As the early response to the coronavirus in Wuhan showed, the Chinese central government is hard-put to respond to a crisis because of the autonomy actually exercised by—often corrupt–local authorities.  Moreover, the claim of the Communist Party to sole authority requires that its failures be covered up.  Finally, China’s flawed economic progress has enriched the Party elite and their cronies.  Fixing problems would require painful sacrifice.[2]  For all these reasons, China is vulnerable to external pressure.

 

How wise or idiotic would it be to exert such pressure?  Anything that triggered a severe economic crisis in China would send shock waves around the globe.  Slumping Chinese production would lead to falling demand for raw materials from many countries.  For example, in 2018, China imported more than $60 billion worth of iron ore, gas, coal, agricultural, forestry and fisheries products.[3]  China is deeply entangled in global supply chains for many goods, so the markets for many Chinese products would also start to strangle.  Finally, the global financial system would suffer from the resulting global slowdown.  Thus, in the interlocked global economy, trouble in China will mean trouble everywhere else.  Furthermore, as history has shown time and again, severe economic problems have comparable political effects.  Sometimes the effects create important reforms.  Sometimes they create turmoil and crisis.  All in all, it seems better to seek a co-operative solution that addresses both the immediate crisis and the underlying problems.  That might appeal to the risk-averse, but they aren’t the only ones making decisions.

[1] Walter Russell Mead, “Trump’s Best Re-election Bet: Run Against Beijing,” WSJ, 23 April 2020.

[2] Walter Russell Mead, “China Is the Sick Man of Asia,” WSJ, 4 February 2020.

[3] See: https://asialinkbusiness.com.au/china/getting-started-in-china/chinas-imports-and-exports?doNothing=1

Chronology of a Tragedy.

By 20 April 2020, 773,000 people in the United States had tested positive for the coronavirus.  Of these, 247,543 were in New York, mostly in New York City and its suburbs.  New Jersey had 88,806 confirmed cases.  That works out to about 32 percent of the cases being located in New York City and its immediate area.  If you include New Jersey’s 88,000, then New York is the center of about 43 percent of the cases.[1]

How did New York City come to be the present American epicenter of the coronavirus pandemic?[2]

“From the earliest days of the crisis, state and city officials were also hampered by a chaotic and often dysfunctional federal response, including significant problems with the expansion of testing, which made it far harder to gauge the scope of the crisis.”  The same was true of every part of the country, so that doesn’t explain why New York got hit hardest by far.

“Epidemiologists have pointed to New York City’s [population] density and its role as an international hub of commerce and tourism to explain why the coronavirus has spread so rapidly.  And it seems highly unlikely that any response by the state or city could have fully stopped it.”  The same seem likely to be true of the national government.  The question is how much government action could have limited the damage.

Nevertheless, in the view of Dr. Thomas Frieden, former head of the Centers for Disease Control and Prevention, closing the schools, stores, restaurants, and other public venues one to two weeks earlier could have reduced the death toll in New York by 50 to 80 percent.

 

January-February 2020: coronavirus “devastates” China and Europe.

 

21 January 2020: first confirmed case in the United States, in Seattle, Washington.

 

23 January 2020: Chinese government seals off Wuhan.

 

30 January 2020: WHO declares a global health emergency.

 

31 January 2020: US bars entry for any foreign national who had traveled to China in the previous 14 days.

 

It now appears that coronavirus was present in New York City before the first person tested positive for it.  Infectious disease specialists had known for weeks that the federal tests were defective and that infected people were almost certainly present and circulating.  One specialist in infectious diseases for a New York hospital group said later than it was apparent by late January 2020 that cases would soon appear in the United States.

 

2 February 2020: first coronavirus death outside China—in the Philippines.

 

5 February 2020: Japanese government quarantines a cruise ship which carried passengers infected during the trip.

 

7 February 2020: Infectious disease specialists and other doctors confer on federal criteria from the CDC for testing.  The guidelines were too strict and limiting on who could be tested.  According to one of those present, “It was at that moment that I think everybody in the room realized, we’re dead.”

 

Early February 2020: Dr. Oxiris Barbot, NYC Health Commissioner states that “this is not something you’re going to contract in the subway or the bus.”

 

14 February 2020: France announces first coronavirus death.

 

19 February 2020: first two cases in Iran announced.

 

23 February 2020: Italy sees surge in cases in Lombardy.

 

24 February 2020: passenger already infected by coronavirus arrives at JFK on a flight that originated in Iran.

 

24 February 2020: Trump administration asks Congress for $1.25 billion for coronavirus response.  US has 35 cases and no deaths.

 

28 February 2020: number of cases in Europe rises sharply.

 

Late February 2020: Mayor Bill de Blasio tells a news conference that “We can really keep this thing [coronavirus] contained.”

 

29 February 2020: first US death, in Seattle.

 

1 March 2020: the passenger from Iran tests positive for the coronavirus, making her the first identified case in New York City.

 

2 March 2020: Governor Andrew Cuomo and Mayor de Blasio address a news conference.  Cuomo says “Everybody is doing exactly what we need to do.  We have been ahead of this from Day 1.”  Cuomo told the conference that “Out of an abundance of caution we will be contacting the people who were on the flight with her from Iran to New York.”  Then everyone would be traced and isolated.  According to the NYT, this didn’t happen because the CDC would not authorize an investigation.

 

3 March 2020: lawyer in New Rochelle tests positive.  He had not travelled to any affected country, so there was reason to suspect he had contracted the virus in New York.  City health investigators traced his travels and contact to Manhattan, but the state of New York put a “porous” containment line around New Rochelle.

 

3 March 2020: US government approves widespread testing.

 

5 March 2020: New York City mayor Bill de Blasio said that “You have to assume that it could be anywhere in the city.”  However, he also said that “We’ll tell you the second we think you should change your behavior.”

 

If Dr. Frieden is correct that the city should have shut down one to two weeks before it did, then that date would have been sometime between 8 and 15 March 2020.

 

About 7 March 2020: city hospitals start reporting a sharp increase in influenza-like cases and the NYPD reported increased numbers of officers calling in sick and of 911 calls for coughs and fevers.

 

Second week in March 2020: De Blasio wanted widespread testing, but the city’s Health Department urged a public information campaign to tell those with mild symptoms to self-isolate at home, rather than infect others at testing centers.  De Blasio blocked the public information campaign for about a week.

 

At some point not stated by the NYT, de Blasio did urge New Yorkers to practice social distancing and working from home where possible; and de Blasio and Cuomo had both ordered occupancy limits on bars and restaurants.  These limits were broadly ignored.

 

Moreover, de Blasio resisted closing the schools.  The schools provide nutritious meals and a safe space, and not in some touchy-liberal sort of way either, for their students.[3]

 

11 March 2020: US bars most travelers from Europe.

 

12 March 2020: San Francisco closed the schools when 18 cases had been confirmed; Ohio closes the schools when 5 cases had been confirmed.

 

12 March 2020: At a meeting chaired by de Blasio, City Health Commissioner Barbot told a meeting of business executives that 70 percent of the city’s population could become infected.  De Blasio “stared daggers at her.”

According to one person present at the meeting, de Blasio rejected closing restaurants.  “I’m really concerned about restaurants; I’m really concerned about jobs.”  It was a legitimate concern from one perspective.  According to one estimate, tourism accounts for 300,000 jobs in New York City.  This is twice as many as does the tech jobs and vastly more than the jobs linked to the financial services industry.[4]  Closing down restaurants, bars, tourist activities, hotels, and sporting events would hammer the incomes pf poor people much than the incomes of rich people.  He appears to have thought that New York City would never have to close.  In reality, it was a choice between closing the city earlier or later.  However, in the event, the virus spread rapidly.  The health burden has not been shared equally between different social groups.[5]

 

13 March 2020: Trump declares national emergency.

 

13 March 2020: Los Angeles closes its schools after 40 cases had been confirmed.  New York City had almost 160 confirmed cases.

 

15 March 2020: City health officials give de Blasio a grim warning about the number of infections and deaths if the schools—and most businesses—weren’t closed immediately.

 

15 March 2020: De Blasio closes the schools when 329 cases had been confirmed.

 

15 March 2020: CDC recommends no gatherings of more than 50 people.

 

17 March 2020: seven California counties around San Francisco issued stay at home orders.

 

17 March 2020: France orders national lock-down.

 

19 March 2020: California issues state-wide stay at home order with 675 confirmed cases.  New York then had 4,152 cases.

 

20 March 2020: New York State issues state-wide stay at home order, effective 22 March 2020.  On 20 March, the state had more than 7,000 confirmed cases.

 

Recently, the New York Times ran a piece considering the long-term consequences of the pandemic’s impact on New York.[6]  Much of the economic basis of the city may be hollowed out.  This is particularly true if a vaccine is not developed and mass-produced very soon.  Tourists may shrink from visiting a densely-crowded city.  Tourist amenities from theaters to museums to restaurants to public transportation systems may impose social-distancing regimes that capsize the business model of the industry.  Both the financial services and technology sectors may extend their work-from-home adaptations, while many workers may decide that the home from which they are working might as well be somewhere other than high-price New York.  Demand for office and residential space could fall, clobbering the construction industry.  The city’s budget would have to deal with a huge fall in revenue.  Services to the poor would fall.

Sometimes Tragedy is born of the collision of two Goods.

 

[1] “Tracking an Outbreak,” NYT, 21 April 2020, p. A4.

[2] J. David Goodman, “How Outbreak Kept New York A Step Behind,” NYT, 8 April 2020.

[3] See: Andrea Elliott, “Invisible Child.  Girl in the Shadows: Dasani’s Homeless Life,” NYT, 9 December 2013.  http://www.nytimes.com/projects/2013/invisible-child/index.html#/?chapt=1

[4] J. David Goodman, “It Could Be Years Before New York Regains Its Glory,” NYT, 21 April 2020.

[5] For one example, see: John Eligon et al, “Black Americans Bear The Brunt As Virus Spreads,” NYT, 8 April 2020.

[6] J. David Goodman, “It Could Be Years Before New York Regains Its Glory,” NYT, 21 April 2020.

The Socialist Boogie Man 21 September 2019.

When it comes to the trajectory of Socialism, critics of Bernie Sanders and Elizabeth Warren are either ignorant or liars.  Historically, Socialism is an economic system in which 1.) society, not the private individual, owns the “means of production”; 2.) planning, rather than the market, determines the production of goods; and 3.) co-operation, rather than competition, is the guiding principle.

Socialism arose as a response to what people saw as the “injustices” of Capitalism; poverty, frequent unemployment; the destruction of the old handicraft industries, awful living conditions in factory cities, and a political system that tilted hard in favor of the capitalists.  Unions and strikes were illegal; there were high property requirements to be able to vote or run for office in most places; and real power belonged to the bourgeoisie.

Early Socialism (1820s-1848) argued that a humane economy and society could be created by building co-operative factories and towns managed by the people who worked and lived in them.  Many amusing stories come from this time.  (See: phalanstery; see: Brook Farm.)

In 1848 the German intellectuals Karl Marx and Friedrich Engels published The Communist Manifesto, creating the form of Socialism later called Marxism.  Marxism argued that a) capitalist greed would lead to a few owners gobbling up all their competitors so that ownership would end in a few hands; b) capitalist greed would lead to wages being forced down to the bare survival level; c) poor people can’t buy the things they produced, so capitalist governments would fight wars to conquer new markets and destroy surplus production that they could not sell; and d) all the miserable poor people would recognize that they belonged to one class (“those who work”) and the few owners belonged to another class (“those that don’t”); and e) revolution would replace Capitalism with Socialism.  Everyone would live happily ever after.

Marxian Socialism became the dominant movement in Socialism after 1848.  However, capitalism began evolving: unions were legalized, wages and living standards rose, governments created social insurance systems, and the bourgeoisie accepted political democracy.  In the early 20th Century, Marxism split into two opposing groups.  Reformist or Democratic Socialists said that Marx’s predictions hadn’t worked out, that revolution had to give way to participating in democratic politics, and that politics required a willingness to bargain with the other classes.  In contrast, Communists said that to achieve Socialism it would take a small group of professional revolutionaries to organize “the masses” and then to lead a continuing revolution.

In practice, Communism turned out to represent “prison camps, overalls, and a damned long march to nowhere.”  Communism is what contemporary American conservatives describe as “Socialism.”

In fact, the British Labour Party, the French Socialist Party, and the German Social Democratic Party have never been anything but guardians of political democracy.  They have never tried to create a monopoly on political power and they have never failed to yield power when they lost a democratic election.  Sanders and Warren clearly fall within this tradition.

Fight them on the real and many failings of Socialism, but don’t scare-monger and lie.

Shareholders versus Stakeholders 1 21 September 2019.

Historically, American industry grew from a foundation based on prioritizing “shareholders” over “stakeholders.”  Labor and communities didn’t count for anything in the epic period of industrialization.  In my original home town, Seattle, the railroad tracks ran right along the shore of Elliot Bay because that led directly to the piers for loading cargo on ships. That’s where the railroads wanted their lines and the public be damned.   In my adopted home town, Easton, the Coal and Iron Police of the Lehigh Valley were deputized by the Commonwealth so that they could lawfully counter unionization.  Then came the Great Depression.  The great corporations were humbled and regulated by the federal government.

Then the Second World War devastated the industrial economies of most countries in the world.  Britain, France, Germany, Italy, and Japan emerged from the war with their industrial plant and agriculture in ruins.  After 1945, the pressing demands for economic reconstruction conflicted with pressing demands for higher standards of living and social welfare systems in many countries.  To make matters worse, Britain and France spent heavily on defense in order to maintain “great power” status.  All of these factors made for a slow revival of competitiveness on international markets.

In the meantime, the United States provided the goods demanded by the rest of the free world.[1]  Thus, during a “golden age” of the 1950s and 1960s, American corporations enjoyed huge profits without struggling very much.  They could reward shareholders and “stakeholders” in ways that satisfied all concerned.  Corporate social responsibility came to mean not laying-off workers or cutting wage and benefits, not closing down plants, not getting rid of unprofitable or incompatible divisions, and not off-shoring production.

Most people were happy with this situation, but not all.  In a 1970 New York Times Magazine essay Milton Friedman, asserted that “there is one and only one social responsibility of business—to use its resources and engage in activities designed to increase its profits.”  Radically at odds with recent experience, Friedman’s view did not receive wide acceptance.  Instead, America’s economy became increasingly uncompetitive without most people noticing.

Soon after Friedman had spoken, huge waves of change broke over the American economy.  Globalization unleashed rebuilt foreign industries on the international and American markets.  Deregulation allowed the entrance of hungry and innovative new competitors onto the domestic market.  Rapid technological change contributed to globalization, while also substituting machines for men.  Furthermore, the 1970s witnessed the two “oil shocks” (1973, 1979).  While impossible in economic theory, combined high inflation and high unemployment turned out to be all too possible in economic reality.

Forced to choose how to use shrinking profits, corporations prioritized “stakeholders” over shareholders.  Savers—you have to save before you can invest—felt themselves to be getting “skint” from management.  Then, in the 1980s, appeared the corporate raiders launching hostile takeovers.  Disgruntled stockholders unloaded their stock on the raiders.  Successful takeovers led to fat, dumb, and happy corporations getting put through the wringer.  Fairly quickly, many boards and managers began prioritizing shareholder value over stakeholder value as a defense.  By the end of the 20th Century, Milton Friedman’s formula had triumphed.

[1] Steven Pearlstein, “When Shareholder Capitalism Came to Town,” The American Prospect, 9 April 2014, https://prospect.org/article/when-shareholder-capitalism-came-town

ChiMerica 1 10 July 2019.

There are real grounds for alarm over China.[1]  Many economists believe that the continuing growth of the Chinese economy will lead it to supplant that of the United States as the world’s largest by 2030 or 2035.  Moreover, China is a dictatorship with apparent ambitions to push the United States out of its dominating position in the Far East and perhaps to exert Chinese influence more broadly.  China has been imprisoning he numbers of Uighurs (Muslims) in Xinjiang province.  Some people suspect that, under Xi Jinping, China has chosen a new course.   Abandoning a “liberalizing” path, the Chinese want to spread modern authoritarianism to other countries in the same way that the United States has been trying to spread democratic capitalism.

The Obama Administration saw the challenge in China.  However, it became mired in peripheral issues (the Middle East, Ukraine).  It never managed to mount an effective response to the central problem of China.  The “Trans-Pacific [Trade] Partnership” treaty fell victim to the populism of the right and the left.  It would not have been implemented even if Hillary Clinton had won the election.

Since 2017, the Trump Administration has pursued a different course.  In December 2017, the White House issued a “National Security Strategy” paper that claimed that China and Russia “want to shape a world antithetical to U.S. values and interests.”  In June 2018, Secretary of State Mike Pompeo said that “China wants to be the dominant economic and military power of the world, spreading its authoritarian vision for society and its corrupt practices worldwide.”  The head of the State Department’s Policy Planning Staff[2] said “This is a fight with a really different civilization and a different ideology, and the United States hasn’t had that before.  The Soviet Union and that competition, in a way, it was a fight within the Western family.”

So far, the struggle has been waged purely on the trade front.  For many years, China has been running a huge trade surplus in trade with the United States.  That is, it sells far more to the United States than it buys from the United States.  However, much of that production is done by American companies who have off-shored factories to cut costs.  If they have to charge higher prices to their American consumers because of the tariffs, then why make the stuff in China?  There’s Vietnam, the Philippines, and Indonesia.  In 2018, President Trump began slamming tariffs (taxes on imports) on Chinese exports to the United States.  Then, Trump tightened the screws with sanctions on the Chinese tech giant Huawei.  It has urged other countries to boycott Huawei and to refuse to participate in China’s “Belt and Road” infrastructure project.  Supply chains are going to start to move.

Because of the huge trade imbalance, China can’t exert much direct pressure on the United States by imposing tariffs of its own.  It can look for substitute suppliers for American exports, like soy.  It has started running lots of old Korean War movies (in black and white) in which China battles American aggression.

At the same time, neither side has pulled out all the stops.  For example, the U.S. has not made much of a deal about China imprisoning many Uighirs

However, we are in the early days of a huge struggle.  It is difficult to see yet how it will shake out.  Weak ending, I know, but true.

[1] Edward Wong, “U.S. vs. China: Why This Power Struggle Is Different,” NYT, 27 June 2019.

[2] See: https://en.wikipedia.org/wiki/Kiron_Skinner

The Worst President Ever 5 July 2019.

Typically, the popular understanding of American history is that the Revolution gave rise to the Articles of Confederation (the first government of the United States); then that ramshackle arrangement soon proved unsatisfactory to many people; and then the present Constitution created the legal framework for subsequent American history.  In fact, there existed deep divide over several issues.  First, federalism (a union of sovereign stares) versus nationalism (a union of states under a strong central government).  Second, the divide—which would only grow until our own time—over who got to be a full “American.”  Those arguments had to be fought out over many presidential administrations.

Many of the contentious issues that would shape American society down to the present day became evident in the administration of Andrew Jackson (1767-1845).  Jackson served as the seventh president of the United States (1830-1838)

He believed that the final interpreter of the Constitution was the President, not the Supreme Court or the individual states.  It is in this light that one must see his opposition to John Calhoun’s doctrine of “interposition,[1] rather than in some doctrine of general federal supremacy.

He believed in the forced removal of the Native Americans to lands west of the Mississippi.  In 1830, he signed a federal law, the Indian Removal Act, which ordered the rapid evacuation of Native Americans from the Southeastern United States.[2]  He defied the Supreme Court to do so.

He opposed the Second Bank of the United States.  The Bank sold government bonds to finance the deficit; it issued a “sound” paper currency that allowed the economy to expand; and it provided credit for business.  In this sense, it served as a predecessor for the Federal Reserve System.  He believed that the Bank endangered American democracy and prosperity by concentrating excessive wealth and power in a few hands.  He vetoed the renewal of its government charter.

Jackson then began shifting federal funds from the Bank to a number of “pet” banks in the state.  Many of the “pet” banks were located in the West.  The principal use of credit in the West was land speculation.  This led to easy credit from the “pet” banks and much speculation in land.  At the same time, Eastern banks found themselves with declining reserves, so they raised interest rates.  In 1836, in an effort to rein-in speculation, Jackson issued a requirement that federal lands sold to the public be paid for in gold or silver, rather than in the inflated paper currency issued by state banks.  This “Specie Circular” was one, important, factor among several causes of the “Panic of 1837.”   The resulting recession dragged on into the 1840s.

A pre-Keynesian, he eliminated the deficit and paid off the national debt.

He appointed Roger B. Taney to be Chief Justice of the Supreme Court.  In the “Dred Scott Decision” (1857), Taney and the majority held that a) African-Americans could not be citizens, and b) that slavery could not be prohibited in the territories.

So, arguably, America’s worst president.

[1] “Interposition” meant that individual states could block the local enforcement of federal laws which the state government considered to be unconstitutional.

[2] See: https://en.wikipedia.org/wiki/Indian_Removal_Act.  Enforcement of the Act resulted in the “Trail of Tears.”  See: https://en.wikipedia.org/wiki/Trail_of_Tears

My Weekly Reader 20 June 2019.

If you don’t like the Donald Trump Presidency, then there are some questions you need to address.  First, is Trump what the Brits call a “one off,” or is he the leading edge of a new wave in American politics?[1]  Second, what led to Trump’s election?  No, it wasn’t the Russians.  No, it wasn’t Hillary Clinton’s incompetence as a politician.  Both are real, but the decisive factors lay elsewhere.  On the one hand, Donald Trump decided to target the grievances of white, working-class men.  On the other hand, Donald Trump decided to run as a Republican, rather than in his natural home as a Democrat.  Like “Bud” White, “he’s not as stupid as he seems.”

The grievances of white working-class men are real.  Once upon a time, they were the mainstays of the “New Deal Coalition” that put Democrats into the White House from 1932 to 1952, from 1960 to 1968, and from 1976 to 1980, along with various majorities in Congress.  Unionized working-class jobs gave blue-collar workers middle-class incomes.  Then they fell by the wayside for complex reasons: mostly mechanization, but also the two successive oil “shocks” of the 1970s, organized labor’s attack on struggling employers in the 1970s, foreign competition, and ideological shifts in the two major parties.  Then, in the 1990s, China’s accession to the World Trade Organization (WTO) under favorable terms compounded the problems of American industry.

As a result, men’s industrial employment declined, new jobs shifted to other geographic areas;[2] new jobs required “college” rather than “vocational” education; and the social world of the “left behind” disintegrated (single motherhood, alcohol and drug use, general demoralization).[3]

No one in either party had bothered to address those grievances.  The suburban base of the Republicans lives in blue oxford-cloth shirts and Dockers (or the female equivalent).  The Democrats have embraced “identity politics,” which excludes the identity of the white working class.  These are “post-industrial” societies.

As a result Trump’s campaign could drag into the ranks of the Republicans a bunch of normally Democratic voters or non-voters.  The opened the possibility of a Republican presidential victory that must have seemed far-fetched if any of the other munchkins running for the nomination won in the primaries.  Republicans lined up behind Trump and they will do so again in 2020.  They get to pack the federal courts for the lifetime of the appointees.  They get to stall and roll-back the imperial decrees of Barack Obama.

Are we—as a country—better for it?

[1] That’s a disturbing thought.  In twenty years we could be talking about John Carpenter’s “Trump Tower: Power Outage.”  In 2025, radical environmentalists (but I repeat myself) sabotage the federally-mandated coal-fired generating plants that power New York City.  Suddenly, the nightlight of the city-that-never-sleeps go dark.  The elevators (and escalators) and AC and cable-television stop working.  Chaos breaks out in the streets below, but atop Trump Tower a “celebrity roast” of former members of the Trump Administration is underway.  Comments by Jim Mattis, Reince Priebus, H.R. McMaster, Hope Hicks, Sarah Saunders, Jim Comey, Jeff Sessions, Rex Tillerson, Nancy Pelosi, Mike Pompeo, John Bolton, etc.  I suppose the deranged killer haunting Trump Tower could wear a Robert Mueller hockey mask.

[2] Try selling your house if you live in Erie, PA.

[3] See: Isabel Sawhill, The Forgotten Americans (2019) and Oren Cass, The Once and Future Worker (2019).  If this is what happened to white Americans, then what are we to make of the impact of “liberal paternalism” on African-Americans since the 1960s?

My Weekly Reader A 19 June 2019.

In traditional societies, people found their identity within and as members of groups.  In the Medieval and Early Modern West, for example, the Christian churches taught morality and sponsored religious confraternities.  The peasant agricultural societies portrayed by Pieter Breughel involved much group labor and existed within the framework of village life.  European cities were governed by professional groups (guilds) and had purchased various group “privileges” from local lords or more distant kings.  People belonged to hereditary “orders” like Commoners and Aristocrats.  These societies existed within belief systems and economic systems that offered little individual choice.

Then things changed.  It took hundreds of years, but intellectual, political, and economic systems all changed.  The Scientific Revolution and the Enlightenment created a skepticism about all received wisdom.  The Voyages of Discovery and the Agricultural Revolution began an economic revolution that spurred rapid growth in both population and wealth.  Rising distrust of received beliefs, an absolute confidence in the power of human Reason,[1] and the growth of a complex middle class then rocked the political system with an Age of Revolutions.[2]

A central feature of all these changes was the rise of Individualism.  Essentially, people aren’t Lego blocks.  Each person is different—if only in subtle and minor ways–from every other person.  Only the Individual person knows what is best for that person: strength and weaknesses, and hopes and fears.  Hence, society and government should seek to maximize the opportunity for Individual fulfillment.  This Individual freedom should be limited only by the requirement that one Individual’s freedom do no harm to the freedom of other Individuals.

This belief system gave rise to Nineteenth Century Liberalism and, by way of reaction, to Nineteenth Century Socialism.  Political Liberalism espoused individual equality before the law, individual rights guaranteed by law, governments answering to elected legislature, and freedom of the press and of thought.  Economic Liberalism espoused economic individualism, free markets, competition, free trade within and between nations, and a small government that concentrated on the essential functions of law and order and national defense.  What Liberals didn’t believe in was either equality or democracy.  Competition—between producers, political parties, and ideas—produced both winners and losers according to the informed choices of consumers.  The whole of society benefitted from competition even when individuals lost.  Similarly, people without the education necessary to understand the competition of ideas and parties, and people with no material stake (property) in the outcome of the debates should have no voice (vote) in the outcome.

Reacting against this position, Nineteenth Century Socialism called for co-operation over competition, planning instead of the market, collective ownership of the “means of production” in place of private property, and democracy with vote for all adult males.  After a while, revolutionary Marxism dominated Socialist thought.

The success of industrialization created immense wealth and immense numbers of industrial workers who were excluded from the political system while living in misery.  Something had to give.  Beginning in the late Nineteenth Century, it did.

[1] See Carl Becker, The Heavenly City of the Eighteenth Century Philosophers (1932).  Hilarious.

[2] I stole that from Eric Hobsbawm, Age of Revolutions: Europe, 1789-1848 (1962).  Remarkable.

Just typing out loud here 12 June 2019.

You challenged me on my enthusiasm for Joe Hill’s “Rebel Girl.”  https://www.youtube.com/watch?v=e_tz3wPgLUw  Didn’t have a good response at the moment, but it got me thinking.  My mind works slower than do those of most people.  Hence the delay.

To my mind, the Democrats are generically anti-business.  Sure, they talk about income inequality and anti-monopoly and this, that, and another New Deals.  But what they mean to apply is an anti-business policy that will fall on all businesses, great and small.  Taxes.  Regulations by decree.  You never see Democrat candidates who have ever worked in/for a business.  You never see ones who have had their own business.  Barack Obama was a “community organizer.”   (George McGovern’s post-presidential experience is instructive here.)  They’ve all spent their lives as lawyers or “in public service.”  Public service is just another way of saying “public employment.”  You don’t get laid off in a recession and you get good benefits.  For following an elaborate set of rules.

They have a fantasy of returning to the Fifties: a few big industries that don’t have any global competition; high wages and good benefits achieved through government-sponsored union-bargaining; owners who inherited their wealth from their rough-and-ready ancestors who actually created it; and a horde of professional managers who deploy B-School-certified skills in return for a generous, but socially-acceptable, salary.  That—at best—is what the Democrats want to recreate.  Basically, Rudolf Hilferding seventy years on.   (See: https://en.wikipedia.org/wiki/Rudolf_Hilferding )

None of this has anything to do with contemporary reality.  It has been one, but only one, of the factors that have driven the American economy—and society—into the ground over the last fifty years.

Yes, there is a lot to criticize in Republican policies.  Mostly, to my mind, it is the starving/shrinking of the necessary regulatory functions of the Federal bureaucracy.  To take some examples: the IRS can’t audit; the FAA has shifted airline safety to the plane manufacturer (singular); the FDA can’t keep up with the companies trying to poison us for fun and profit.  Theodore Roosevelt theorized that only a strong government could mediate the conflicting demands of Capital and Labor.  Republicans are gutting the system projected by their second-greatest president.  The reduction of the corporation tax to international (i.e. Canada) norms seems to me a good idea.  All the tax cut-spend-elect stuff to counter Democrats’ tax-spend-elect stuff is wrong, but wrong for both parties.  And wrong for the American voters who gobbled it up.   Maybe “snorted” would be better?

As for “bigness,” see Ellis Hawley, The New Deal and the Problem of Monopoly.  Yes, we’ve been down this road before.

In the end, what I’m fighting for is my Dad and all the people like him.  He didn’t want to work for the government and he didn’t want to work for a giant business.  He had done both (Army, Shell Oil).  He just wanted his own show.  Win or lose, it was on him.   What’s wrong with that?  He provided a service that people wanted.  He paid his employees the best he could.  Wasn’t great money, but it was the same deal for them that he made.  They weren’t working for the government or big business.  There weren’t procedures to deal with.  Just people.  He and my Mom did a lot of unpaid work to make the business run.  I guess I don’t see much difference between my Dad and an artist: they’re both self-actualizing and creative.  Along the way, he put a roof over our head and food in our mouths and paid his taxes.  Some of those taxes went to pay for public competition with his private business.  Why?  Because not all high-school teachers wanted to coach, so some of them would rather work extra as driving instructors.  Teachers had a union, but private business did not.

 

 

In the Nineteenth Century, the United States prided itself on being the land of “Go-Getters.”[1]  A vast continent packed with natural resources awaited exploitation.  At the same time, American entrepreneurs felt a grievous need for labor to transform those riches into “riches.”  Partly the country satisfied that need through massive immigration.  Partly the country satisfied the need by technical innovation to substitute machines for men.  Partly, the “professional” standards were lower then.  People—men mostly—could try their hand at whatever caught their fancy.

Yet, with all the problems of using what the United States already possessed, there were people who wanted to expand the “Empire of Liberty” still more.  As the term “Manifest Destiny” began to buzz about, people began to ask in which directions that destiny lay.  For most, it meant expansion westward to the Pacific Ocean.  For others though, such notions reeked of reticence, even cowardice.  Everywhere one looked to the South of the United States one saw the same conditions: vast natural wealth going to waste, the “rule of ignorance and superstition” (a common term for the Catholic Church); and the brutal oppression of the many by the self-enriching few.  These were the hall-marks of mid-century Mexico, Spanish-ruled Cuba, and—worst of all—Central America.  By 1836, Texas had gained independence from Mexico; by 1848, California.  The Mexican-American War had ended with a definitive boundary between the two countries.  Still, why stop there?  Why not add southern lands or Pacific islands?

At the same time, the issue of slavery began to tear savagely at America.  All the political compromises banned slavery “north of” some line.  What if the United States—or some one acting on behalf of the United States—conquered foreign lands where slavery already existed or had recently existed?  The sectional “balance” might be restored in an enlarged United States.

It is against this background that we might see the career of William Walker (1824-186o).[2]  The Southern-born Walker tried to set-up an independent state of Sonora and Baja California (1853-1854).  He next invaded Nicaragua, where he made himself President (1855-1857).  In Nicaragua, Walker reinstated slavery, made English an official language, and encouraged immigration from the United States.  Kind of like Texas in the 1820s-1830s.  In the end, an army of understandably-nervous Central American oligarchs drove out Walker.  So, no Santa Ana.  In 1860 Walker took another swing at Central America by trying to invade Honduras.  He wound up having a last smoke in front of a pock-marked adobe wall as a dozen sweating soldiers fiddled with their weapons.

As a thought experiment, consider what would have happened if Walker had succeeded in adding Nicaragua and Honduras and a chunk (or all) of Mexico to the Estados Unidos.  Perhaps the Americans would have wiped out the “colonial legacy” from Spain.

Perhaps the new territory would have ended up like Texas and California.  Leaving aside the Democrat-Republican split, they are both big states with diverse populations, and are states with lots of natural resources and lots of industry.  Same might have happened to Central America if it had become part of the United States.  Perhaps everyone would have been better off?

[1] Not to be confused with the drag performer Carmen Geddit.

[2] Scott Martelle, William Walker’s Wars (2019).