The Age of Revolt 1.

            Where did “Trumpism”–the political movement–come from?[1]  It arose out of the profits and losses from globalization.  The costs were born by one segment of American society while the profits flowed to another segment.  The beneficiaries were, first and foremost, the “political, cultural, and financial elite.”  Their right to lead rested upon the pursuit of the common good. 

In theory, the free-trade policies pursued by a whole series of American administrations after the Second World War would benefit Americans.  They would allow the American economy to shift jobs producing low-value goods offshore and to redeploy assets toward higher-value jobs and goods.  For a long time, these policies had no costs for Americans.  The American economy emerged from the war with a long-term competitive advantage over anyone else.  It could have not only butter and guns, but low-end butter and high-end butter.  By the Sixties, that advantage had eroded badly.  As foreign competition began to bite, it turned out that a lot of people depended on those low-value jobs for their living and found it difficult to shift into high-value jobs. 

Globalization began to take a more serious toll on the American working class in the wake of the “Oil Shocks” of 1973 and 1979.[2]  That seems incomprehensibly long ago to most journalists and politicians, so they just ignore the larger story.  Then the North American Free Trade Agreement (NAFTA, 1994) reduced tariffs on trade with Mexico and Canada.  It accelerated the early wave of job-losses.  Already in the 1990s, Pat Buchanan and Ross Perot could run for president, if not win, on the loss of blue-collar manufacturing jobs.  At the same time, China’s abandonment of suicidal Maoist economic policies and its entry into the World Trade Organization (1990) greatly accelerated the loss of jobs.  Those job losses not only tossed many workers into unemployment, they also left whole communities hollowed out and unable to address human problems.  They not only tossed workers into unemployment, they undermined the value of the homes that formed an important asset of many workers.  They not only tossed workers into unemployment, they also foreclosed the possibility of the children of the workers finding steady work at a living wage anywhere near their parents. 

Globalization may have eroded manufacturing jobs, but it created enormous opportunities for the American financial services industry.  Industrializing countries needed capital and expertise.  Wall Street could provide both, not least because of the inflow of Chinese profits to New York banks and to the swelling 401(k) savings of the Baby Boomers.  Increasingly “cosmopolitan” in its outlook, Wall Street also became increasingly influential over national economic policy.[3] 

The year 2008 marked a turning point.  A great deal of elite foolishness and some guile created the 2008 financial crisis.  That, in turn gave rise to revolts on the right (Tea Party) and left (Occupy Wall Street); and to the invasion of the political system by “outsiders” like Barack Obama and Sarah Palin.  Donald Trump, the ultimate outsider, was just a heart-beat away. 


[1] Gerald F. Seib, “Where Trump Came From—And Where Trumpism Is Going,” WSJ, 16-17 January 2021. 

[2] “In the wake of” does not mean “solely caused by.”   For more of my peculiar view of this process, see https://waroftheworldblog.com/2015/03/02/american-union-stay-away-from-me-uh/  and https://waroftheworldblog.com/2015/12/17/the-new-economy/

[3] For one highly critical view of this process, see Simon Johnson, “The Quiet Coup,” The Atlantic, 5 May 2009. 

The Asian Century 17b.

Yet, for historians—if not for political scientists or economists—there is reason for cautious optimism.  On the one hand, the historical record suggests that democracies can be slow to mobilize their strength, but better able to mobilize that strength over the long haul.[1]  If one looks at (or, much worse, had to live through) the period from 1930 to 1942, one could easily believe that the liberal system had shot its bolt.  Economic depression, the collapse of new democracies, the appeasement of authoritarian nations, and military defeat slammed confidence in the Western system.  Three years later Berlin and Tokyo lay in smoking ruins. 

Second, “there’s a great deal of ruin in a nation.”[2]  The recent unpleasantness at the end of the Trump presidency led journalists and public intellectuals to invoke the example of the disputed presidential election of 1876.  Squalid as were those events, they also helped settle a period of deep division within the United States and helped bring on a long period of rising power and prosperity.[3] 

American business may be resistant to government guidance on China policy, but it is resistant to government policy on many things.  Usually, the outcome is satisfactory to most people.  American society is immensely creative and innovative.  The rapid development of two vaccines for Covid 19 demonstrate that old truth.  Conversely, the many problems with distributing the vaccine fall to the responsibility of the state and federal governments.  Hardly cause for business to defer to the state.  During the pandemic, American businesses have moved rapidly ahead with collaboration software (like Zoom), direct delivery bypassing stores, and cloud computing to manage all of it.  Compare this with the PRC’s treatment of Jack Ma, the entrepreneur who created Alibaba and Ant.  He got “disappeared” for a while after he suggested that entrepreneurial innovation outstrips old ideas.  About the subordination of business to the state for example. 

America remains remarkably open to immigration.[4]  Immigration helps off-set the aging of the native-born population, while admitting large numbers of people eager to work and to create their own futures.  In contrast, the PRC oppresses its own people and violates international agreements, like the Anglo-Chinese agreement on Hong Kong, in order to get more people to oppress.  China is not a country of voluntary immigration. 

By any standard, China’s economic progress since the death of Mao has been extraordinary in statistical terms.  However, much of that progress came from moving peasants out of low productivity rural farming and into higher productivity urban manufacturing.  The government has used subsidies, entry into the world market, and massive intellectual property theft to push China so far forward so fast.  There is good reason to wonder if the PRC has reached the limits of what can be obtained by such methods.  Just when they’ve alarmed the US. 


[1] This is a central theme of Gordon Wright, The Ordeal of Total War, 1939-1945 (1968).  It remains the best single volume history of the Second World War. 

[2] Adam Smith.  I forget where I read it, but it stuck with me. 

[3] Richard White, the author of The Republic for Which It Stands: The United States During Reconstruction and the Gilded Age, 1865-1896 (2017), would wish to qualify this view if it ever came to his attention. 

[4] In 2017, 2018, and 2019, an average of 1,085,181 people obtained lawful permanent resident status each year.  In 2013, 2014, 2015, and 2016, an average of 1,060,401 people obtained lawful permanent resident status each year.  See: https://www.dhs.gov/immigration-statistics/yearbook/2019/table1 

The Asian Century 17a.

            It is now commonly accepted that the United States (US) and the Peoples Republic of China (PRC) are strategic competitors.[1]  All eyes regard this competition, for they represent two different approaches to government and economic management.[2]  China combines an effective authoritarian government with state-managed semi-capitalism.  The US combines democracy with a regulated free market.  For the duration of the “Fifty Years War”[3] the United States represented the preferred wave of the future for an ever-growing share of the world’s population.  Is the US able to win a new competition or have essential elements of its previous strength dissolved?  Is China better able than were Nazi Germany and the Soviet Union to win a competition with the US?  It depends where you look. 

Does the Covid 19 pandemic of 2020 offer any insight into the relative positions of the US and the PRC?  The answer must be NO if examined in international perspective.[4]  Democratic Taiwan did better than the PRC; the United Kingdom did even worse than did the US in spite of doing all the things that Democrats criticized the Trump administration for not doing.  The explanation for the diversity of results may have something to do with an Asian culture of compliance with the public interest in comparison with a Western culture of asserting individual rights at the expense of the community. 

It is sad, but true that the Covid pandemic is a transitory event.  It has been deadly and disruptive in its impact, but in a year it will be history.  More fundamental issues should be alarming.  So far, China has won the trade war launched by President Trump.  During 2020 its trade surplus increased, as did the trade deficit of the US.  The Trump administration’s attack on Huawei Technologies led the PRC to pour resources into its semi-conductor industry.  American efforts to get other countries to join in exerting pressure on China signally failed.  European, South American, and Asian countries are so entranced by the promise of the China market that they seek to fill the gaps when other countries try to pressure China.[5]  Nor is American politics oriented toward pursuing a coherent industrial policy during peacetime.  One of Trump’s last acts as President was to see his efforts to encourage an American rival to Huawei come to grief.  Intel announced plans to offshore some of its chip production; while Cisco rejected government entreaties to buy either Nokia or Ericsson.  Here they put the bottom line ahead of national strategy.  One of Biden’s first acts as President was to cancel the permit for the Keystone XL pipeline.  Here he put the demands of environmentalists over the interests of America’s Canadian ally (and over those of the American construction workers who had been building the pipeline). 

Finally, Chinese news media are portraying the riot at the Capitol as proof that American democracy is crumbling.  Many, here and abroad, would agree with this grim judgement. 


[1] Greg Ip, “China Played Its Hand Well in 2020.  Will It Keep Winning?” WSJ, 23-24 January 2021. 

[2] I’m not sure how Francis Fukuyama makes sense of this development.  Apparently, Hegelianism only takes you so far.  See Fukuyama, The End of History and the Last Man Standing (1992).  Still, he’s teaching at Chicago and I’m working at an educational wide spot in the road.  So,…

[3] The struggle from 1940 to 1990 between capitalist liberal democracy and autarkic dictatorships. 

[4] See: https://ourworldindata.org/covid-cases 

[5] For example, the European Union recently concluded an agreement with China to increase investment.  In doing so, they ignored a suggestion from Jake Sullivan, then President Biden’s national security advisor-designate that they should wait. 

My Weekly Reader 7 January 2021.

            The Enlightenment had a good year in 1776.  The year witnessed the publication of “The Declaration of Independence,” Edward Gibbon’s History of the Decline and Fall of the Roman Empire, and Adam Smith’s The Wealth of Nations.  Smith attacked the prevailing “mercantilist” economic policies of the time, arguing that tariffs serve only politically-connected special interests at the expense of the larger community. 

            Broadly, for much of their history, Americans rejected free-trade as the best engine of prosperity.[1]  While James Madison advocated a ‘very free system of commerce” in the early days of the Republic, Alexander Hamilton preferred a mercantilist/protectionist line.  Tariff policy veered toward the Hamiltonian line once industrialization began, to the great distress of Southern cotton exporters.  After the Civil War, high tariffs became an article of faith among Republicans.  It is by no means clear that tariffs actually contributed much to American economic development in the “Gilded Age.”  Abundant natural resources combined with a scarcity of labor that put a premium on technological innovation probably did much more than tariffs.  Still, they didn’t hurt.  High tariffs as a protection against “unfair” foreign competition became a totem.[2] 

            Making a totem out of high tariffs came back to bite Republicans when passage of the Smoot-Hawley Tariff Act (1930) coincided with the plunge into the Great Depression.  Even though the Federal Reserve’s tight money policy during the 1920s played a far larger role, the high tariffs and falling trade explanation was ready to hand.[3] 

After the Great Depression drove many countries toward high tariff walls and autarky, after the Second World War wrecked most world economies, Republicans and Democrats converged on a new orthodoxy of free trade.  The United States played the leading role in designing the new world order of the Bretton Woods System.[4]  Americans continued this drive through the 1990s, with successive “rounds” of multilateral tariff reductions and the North American Free Trade Agreement (NAFTA). 

Some of the economic and social dislocations of recent decades loosened the post-war consensus.  Republicans still clung to free trade as tightly as they once clung to high tariffs, while Democrats lost the enthusiasm for free trade that inspired them from Franklin D. Roosevelt through John F. Kennedy.  More recently, populist uprisings in both parties have disrupted the march toward a still more integrated world economy.  Senator Bernie Sanders attacked free trade in general and the Trans-Pacific Partnership (TPP) in particular during his run for the Democratic presidential nomination in 2016.  Rival Hillary Clinton soon moved from being a leading proponent of the TPP to having her doubts to opposing it.  Donald Trump seized the Republican nomination in part by dint of his scalding criticism of NAFTA and Chinese trade practices. 

Will policy now snap back to normal under Joe Biden or are we at the dawn of a new era of managed trade?  The ability to formulate policies that help those displaced may hold the key.         


[1] Douglas A. Irwin, Clashing Over Commerce: A History of US Trade Policy (2017).  Reviewed by George Melloan, WSJ, 29 November 2017. 

[2] Tax cuts as the solution to every problem has become a similar totem for Republicans since the Reagan presidency. 

[3] See: https://en.wikipedia.org/wiki/Availability_heuristic 

[4] The General Agreement on Tariffs and Trade (GATT), the World Bank and the International Monetary Fund (IMF), the Marshall Plan and support for European integration all were vital early contributions. 

Looking Forward in December 2020 1.

            The recession of 2020 and beyond did not spring from “normal” causes.[1]  It sprang from the Covid-19 pandemic.  That pandemic continues to ravage the world, so a full recovery cannot begin.    Only widespread vaccination will allow the American economy to recover.  Estimates for that seem to run into mid-Summer 2021.[2]  An optimist might guess-timate that the economy will have fully recovered by the end of 2021. 

            The federal policy response to the Covid-triggered economic crisis[3] has been far more robust than the response to the 2009 financial crisis that led to the “Great Recession.”  Including the bill just signed—finally–by President Trump, the government spent more as a share of GDP over two years than the previous administration spent over five.  This may have contributed to avoiding the steep plunge in spending by states that helped deepen the crisis of a decade ago.  All this means that the economy did not sink into as deep peril as was the case ten years ago. 

Then, there are reasons to hope that the economy can make a sustained recovery.  The Federal Reserve Bank has promised to not raise interest rates until annual inflation hits two percent and all the Covid-caused unemployment has been absorbed.  This recession may not have done as much long-term damage as normal recessions.  Bankruptcies haven’t shot up the way one would expect, although they may still rise.  If many businesses are “only mostly dead,”[4] many could spring back.  If they do, then they will bring back employees while reviving pre-recession relationships with suppliers and customers.  A long drawn-out recovery is not fated. 

With a third of a million Americans dead from Covid-19 so far, it may seem petty to turn to the political effects.  Yet both parties are struggling to define their course in an environment without the disruptive factors of Donald Trump and Covid-19.  The outcome of these struggles will influence the direction of American society in the immediate future.  Would a rapid recovery dampen enthusiasm for any sweeping changes in economic organization or the role of government?  Would business people claim that they had “Built Back” during the recovery largely on their own?  Would it be difficult to blame anyone, other than the virus, for the recession?  Would Republicans want to fend off all calls for assistance to the “front-line” and “essential” workers once the crisis has passed, even if they try to restrict the scope of such definitions that President Biden would propose?  It is shaping up to look like at least two more years of tweaks to legislation.  Most of the action will come in nibbling rule-writing rather than in big new laws. 


[1] Greg Ip, “2021 Could Be (a Lot) Better Than You Think,” WSJ, 24 December 2020.  On Ip, see: https://en.wikipedia.org/wiki/Greg_Ip 

[2] See, for example, the chart on the front page of the WSJ, 12-13 December 2020.  However, that leaves aside places in the world where vaccination will take place later.  Will Egypt ever get around to vaccinating any but the elite? 

[3] This is different from the federal response to the health emergency itself.  Operation “Warp Speed” appears to have done an astonishing job of creating and now distributing the vaccines that offer the only real long-term solution.  No one would—or should—forgive President Trump for his relentless down-playing of the immediate dangers or his undermining of scientific opinion on short-term safety measures.  He had the chance to be seen as a great president  He muffed it 

[4] See the classic exposition of the distinction: https://www.youtube.com/watch?v=xbE8E1ez97M 

The Asian Century 14.

            The way it looks at the moment, the foreseeable future will be dominated by tiny things: deadly viruses and ultra-thin semi-conductors.  Controlling both holds the key to leadership (and possibly survival) in the Twenty-First Century.  Both come from Asia.  Of the two, computer chips may be the more pressing long-term concern.[1] 

            Inevitably, this begins as History.  The West pioneered industrialization, then moved up the ladder from making simple things to making more complicated and higher-value things.  From this they drew immense wealth.  Wealth converts into military power.  From the late Eighteenth Century onward, the West both shot ahead of the rest of the world and began to impose its rule on the rest of the world.[2] 

            Since the Second World War, many countries have wanted to follow the Western path.  For most of the imitators it meant beginning where the West had begun, with simple mass-produced goods that the West no longer cared to produce.  Textiles, then simple electronics, then motorbikes and automobiles.  They were filling global needs without competing head to head with the established economies. 

            Two countries—South Korea and Taiwan—went farther than making textiles, steel, and ships.  Taiwan’s strategy: invest heavily in research and development; build human capital through education and hold that capital in Taiwan; push rapid adaptation to changing markets in the West; encourage new businesses, rather than guard the established giants; and don’t put the hackles up on key Western manufacturers. 

            One of those start-ups was the Taiwan Semiconductor Manufacturing Company (TSMC).  The Taiwanese government chose Morris Chang, an American-educated Taiwanese, to begin creating a semi-conductor industry.  They didn’t set him to jumping too far by building an industry to use those chips in things like smartphones.  They set him to building the essential component of such devices.  He succeeded, but–true to the Taiwanese form—he didn’t rest on his laurels.  TSMC kept pushing up the ladder to chips until it became the leading producer of high-end semi-conductors.  What it did not do was to branch out into making the devices produced by powerful companies like Apple.  Both American and Chinese device manufacturers came to rely on abundant supplies of TSMC chips. 

            Now TSMC and Taiwan are becoming important “chips” in a different game.  The Trump Administration broke with previous American policy by taking seriously the profound Chinese-American rivalry.  Tariffs formed one part of its campaign, but so did a campaign to block the expansion outside China of the Huawei Company.  The American campaign against Huawei aimed, in part, to block the Chinese company’s access to TSMC chips.  The Trump Administration also encouraged TSMC to build a chip plant in the United States. 

            IF artificial intelligence and high-speed computing are going to be two corner stones of economic power and national prosperity, then high-end chips are an essential interest of both China and the United States.  Will the complicated Sino-American relationship on this issue and on so many others be resolved by diplomacy? 


[1] Ruchir Sharma, “It All Comes Down to Taiwan,” NYT, 15 December 2020. 

[2] David S. Landes, The Unbound Prometheus: Technological Innovation and Industrial Development in Western Europe from 1750 to the Present (1969). 

Climate of Fear XXII.

            The Paris Climate Accords, which the Obama administration helped negotiate in 2016, contained flaws as well as virtues.[1]  The virtues have been sufficiently broadcast, so it is worth looking at two flaws. 

First, the reductions in greenhouse gas emissions promised by other countries were purely voluntary.  No one except Morocco and Gambia has met their commitments.  This lack of enthusiasm about compliance with even voluntary targets provides ammunition to critics of the Accords.  If the threat is real, it could be argued, then counties would drive ahead regardless of American participation.  If the threat isn’t real, then is the climate crisis being over-hyped?  Is the United States being beset by a warming planet or by a combination of ivory tower zealots with rival foreign economies seeking a competitive advantage?[2] 

            Second, it is not a treaty.  It is an executive agreement.  Never ratified by the Senate, it never became legally binding on the United States.  Furthermore, it could be—and was—abandoned by the United States as soon as a president hostile to the agreement waved good-bye to the moving van that deposited his stuff in the White House.  In this sense, the Paris Accords resemble the Versailles Treaty ending the First World War with Germany.  Even if the Accords could be converted to a real treaty, it is unlikely that it could get the two-thirds vote needed for ratification.  In short, the Democrats need to win more than a simple majority in the Senate to get a legally-binding treaty in place.  Even passing the legislation to implement a revived executive agreement could be tricky.  This will leave the Biden administration with the same slog through executive orders and rule-writing in which the Obama administration engaged so much energy. 

            One possible lever on the economy for the Biden administration would be to define climate change as not just an “environmental threat” or as a “national security threat,” but also as a “financial stability threat.”  Both the Treasury Department and the Federal Reserve Bank offer means to impose government policies without new legislation.  Both possess robust regulatory powers that can lever corporate policies and investor behavior in new directions. 

            The Obama-Trump-Biden pattern of rule writing followed by re-writing followed by re-re-writing is dangerous.  It turns what should be a predictable framework for decision-making into a quadrennial football.  On the one hand, the financial services industry is a vital part of America’s domestic economy and of its international trade.  Is it a good idea to build-in systemic uncertainty? 

On the other hand, the whole enterprise of governing through rule-writing and executive orders is deeply undemocratic.  It further exalts the executive branch; it further diminishes the legislative branch; and it further politicizes the judicial branch. 

No matter how much they are loved by their beneficiaries, rapid globalization and the growth of the “administrative state” have not received a unanimous warm welcome.  “Brexit” is best understood as a revolt against the European Union.  Donald Trump’s election is best understood as a revolt against the dominant policy strand of recent decades.  There is no guarantee that the revolt will end if Biden goes back to the same old policies. 


[1] Walter Russell Mead, “Climate Finance May Foul the Economy,” WSJ, 8 December 2020. 

[2] That’s not what I believe (although both things could be true).  It may well make sense in coal country or the oil patch or the “Rust Belt.”    

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.