The Buckle on the Rust Belt.

Posted on May 19, 2017 by jsh54

From the 1890s to the 1970, you could travel from Rochester to Buffalo to Pittsburgh to Cleveland to Dayton to Gary to Chicago to Milwaukee to Detroit, and see the beating heart of American industrial power. It helped win two World Wars and helped keep the Cold War cold. It provided lots of jobs at increasingly good wages to millions of workers. American manufactured goods dominated world markets.

Then things went sour.[1] Between 1979 and 1994, the U.S. lost half of its manufacturing jobs. Improved technology and automation are part of the explanation. The growth of international competition as foreign industry revived or started fresh after the Second World War offers another part of the explanation. The domestic competition from new “mini-mills” in steel and other disruptive industries that targeted the low end of the market offers another part of the explanation. JMO, and I come in peace, but the arthritic nature of much heavy industry offered another part of the explanation. Bloated industrial bureaucracies and rigid work rules imposed by unions alike made American manufacturing slow to respond to challenges.

Then, in 1994, came the North American Free Trade Agreement (NAFTA); in 2001 China gained admission to the World Trade Organization (WTO). Between 2000 and 2010, 5 million more manufacturing jobs disappeared.[2]

The human costs of successful business adaptation to changing conditions have been very high. Old industrial cities and regions have lost jobs and incomes, and many of the businesses once supported by consumers. Local and state governments have lost the tax revenues from these businesses, so they struggle to provide services to people in crisis. Lots of people have lost hope. Many younger people have moved away in search of a future that works. Many of the displaced shifted into the ballooning service industries of health and education. Not healing or teaching so much as filling out forms. In some cases, however, the older people left behind with no future that works have turned to substance abuse.[3] Much to the distress of the Democrats, the 2016 election demonstrated that these once-reliable voters could not be taken for granted.[4]

For reasons not immediately apparent to me, free trade, an open world economy, and “globalization” became the goat. Free trade helps many American producers: 40 percent of corporate profits and 30 percent of agricultural revenue comes from foreign sales. Also, the Gummint projects that 3.5 million jobs will be created in specialized manufacturing by 2025. This means workers (presumably named Dave) who can run the robots.

There probably is no way of “saving” or “reviving” the “Rust Belt.” Guys now in their 40s and 50s who walked off the high school graduation stage into a job at the plant aren’t likely to want to/be able to “retrain” as medical coders or McDonald’s imagineers.[5] They’re close to the end of their working lives. Soon enough, they’ll be on Social Security and Medicare. Give them basic medical coverage and beer money.

That doesn’t mean that there isn’t room for improvement in the trade deals around the margins. After an ugly early spat with Mexico, the NAFTA renegotiation has begun. China is next, although there is the whole North Korea issue to tilt the scales.

[1] “Rescuing the Rust Belt,” The Week, 24 March 2017, p. 11.

[2] Economists estimate that 85 percent of these jobs were lost to automation of production. It cuts labor costs: welders in the auto industry earn $25 an hour; spot-welding robots cost $8 an hour. Take that coolies!

[3] Obviously, this latter issue is a much more complex story than is presented here.

[4] The recent passing of Norman Lear led to much revealing commentary in the media.

[5] As in “imagine this is real food.” Except, you know, those sausage biscuits (without egg) with a coffee and hash browns you get early on Sunday morning when you’re headed home? Whole world feels fresh and new and clean.

Memoirs of the Addams Administration 19.

Posted on May 14, 2017 by jsh54

In late March 2017, House Republicans had to pull the American Health Care Act (AHCA) because they couldn’t cobble together a majority from the disparate Freedom Caucus and moderate factions of the party. In early May they took another stab at it. This time the bill passed the House of Representatives by a razor-thin (as the cliché goes) margin. The new and improved AHCA ended the mandate[1], but allowed insurance companies to charge extra for people who let coverage lapse and then applied in a hurry once they got sick; granted the states the right apply for waivers if they wanted to allow insurance companies to offer plans with fewer “essential services” than mandated by the Affordable Care Act (ACA)[2]; “rolled-back” the expansion of Medicaid (which observers predicted would cut 25 percent/$880 billion in health-care spending over a decade); replaced the income-based subsidies of the ACA with age-based tax credits[3]; allowed insurance companies to charge old people much more than young people[4]; and encouraged states—through a promised $138 billion in federal subsidies–to create high-risk pools for those with pre-existing conditions that insurance companies wouldn’t touch with a ten-foot pole.[5] The right-to-life-but-not-to-medical-care-once-born crowd insisted on defunding Planned Parenthood.[6]

Republican Senators, who live in a radically different political environment than do Republican Congressmen, didn’t like the handiwork. Senate majority leader Mitch McConnell set up a baker’s-dozen of Republican Senators to save the party from an electoral disaster in 2018. They are expected to sketch a fig-leaf with regard to things like Medicaid spending, and coverage of the Emma Lazarus people: “Give me your tired, your poor, Your huddled masses yearning to breathe free, Your people with pre-existing conditions.”

Is there any way to make a Republican plan work? Yes, if you aren’t a 100 percent Democrat. The ACA expanded entitlement programs to provide health care to the poorest Americans. It had little effect for most Americans. It did not create health-care insurance for most Americans, nor did it seek to rein-in the rising costs of health-care. Most people receive their health care through their employers or through Medicare. The Republican plan poses no serious threat to these people. Republicans are betting that health care lite for the poor will be politically acceptable to most voters. Are they correct?

One contested issue lies in the effect on taxes. Democrats jeer that the AHCA will lead to a $1 trillion cut for the richest Americans over a decade. However, the ACA imposed a $1 trillion additional tax on those same richest Americans. This casts into doubt the claim that the mandate is necessary so that poorer young people will subsidize richer older people.[7]

[1] This is an acknowledgement that many young people don’t want or need insurance, or—if they do—resent being ordered around by the government as if they’re the hired help. There probably are about 14 million of these timid fugitives currently on the rolls of Obamacare. Millions more have not signed up because the Internal Revenue Service does not require that taxpayers actually submit proof of coverage.

[2] This is a concession to the people who were promised by President Obama that “if you like your insurance, you can keep it” and then had the rug pulled out from under them. Sad to say, attention to detail proved not to be Obama’s strongest quality. See: “Healthcare.gov roll-out.” Lots of times “big picture” people aren’t good at this.

[3] So people in their 20s would get up to a $2,000 credits, while people in their 60s would get up to a $4,000 credit.

[4] Up to five times as much, compared to the ACA’s limit of three times as much. However, old people consume far more health care than do young people, so the ACA appears to be a taxing of low income people to support higher income people.

[5] “Health-care reform heads to the Senate,” The Week, 19 May 2017, p. 5.

[6] Still, last time I checked, condoms were a dollar each at CVS.

[7] “American Health Care Act: The winners and the losers,” The Week, 19 May 2017, p. 6.

The Comey Effect.

Posted on May 10, 2017 by jsh54

Did F.B.I. Director James Comey’s public statements about the investigation of Hillary Clinton’s e-mail cost Clinton the election?

On 19 October 2017, Hillary Clinton debated Donald Trump for the final time. In the immediate aftermath of the debate, polls showed Clinton with as much as a 12 point lead over Trump. However, by the morning of 28 October 2016, before Comey’s surprise announcement about re-opening the investigation in light of newly-discovered e-mails, national polls showed Hillary Clinton leading Donald Trump by only 6 percent.

Then came Comey’s statement of 28 October 2016. Polls showed a sharp drop in support for Clinton. However, some confusion arose and persists. The results of a number of polls taken before the Comey announcement of 28 October 2016 were not published until after the announcement. These showed an even sharper drop in support for Clinton than more widely noticed polls revealed. “In retrospect, there is virtually no evidence to support the view that Mrs. Clinton really had a six-point lead by Oct. 28,…” Because the findings of the polls were published after the announcement, commentators lumped these results with other polls conducted after Comey made his announcement.[1] This made it appear that Comey’s announcement had a greater effect on Clinton’s mushy support than was the case.

Obviously this analysis targets only Comey’s second intervention in the election. The first came with his public announcement that no criminal charges would be pursued against Mrs. Clinton over her use of a private e-mail server. He went on to excoriate her careless handling of security issues. Doubtless this incident did Clinton far more harm than did the October announcement.[2] However, one early account of the Clinton campaign by friendly observers indicts the campaign from first to last as fatally flawed by incompetence and arrogance.[3] This carnival created the situation in which Comey’s statements could have such effect.

In any event, James Comey now has time to work on his memoirs.

[1] Nate Cohn, “An Election Review: There’s Reason to Be Skeptical of a Comey Effect,” NYT, 9 May 2017.

[2] On all this, see: https://waroftheworldblog.com/2016/12/13/the-hacked-election/ and https://waroftheworldblog.com/2017/03/31/the-james-comey-show/.

[3] See Michiko Kakutani, “Charting Hillary Clinton’s Course for the Iceberg,” NYT, 18 April 2017; and Barton Swaim, “Hillary the Unready,” WSJ, 18 April 2017.

Memoirs of the Addams Administration 18.

Posted on May 9, 2017 by jsh54

There is no longer a filibuster on judicial appointments, but there can be one on spending bills. Since Republicans hold 52 Senate seats (rather than the 60 needed to stop a filibuster), they had to deal with the Democrats to pass a bill that covered government spending through September 2017. What did the Republicans get out of the deal? They got a big jump in defense spending ($12.5 billion) and in “securing the border” by non-wall means ($1.5 billion). What did the Democrats get out of the deal? Several of the federal agencies that President Trump wanted to put on short-rations came through relatively unscathed for the moment: the Environmental Protection Agency and the National Institutes of Health. Federal aid to Planned Parenthood is preserved. There is no money for “the wall.” American generally benefitted from not having a “government shutdown,” although President Trump raised the possibility of a more serious confrontation in September.[1]

The flip side of spending is taxation. The Trump administration released a bare outline of proposed tax change legislation. The plan proposed to create three tax brackets (10, 25, and 35 percent); cut the corporate tax rate from the nominal 35 percent (with a ton of loop-holes) to a standard 15 percent (pretty much the international norm); and get rid of the Alternative Minimum Tax and the Estate Tax.[2] The intellectual concept behind this plan is that lower taxation will lead to a surge in economic growth that will generate more revenue over time than it costs. Many people on both the left and the right are deeply skeptical–to put it mildly–of this belief. The Trump administration pointed to the slow growth of the first quarter of 2017 as proof to the harmful effects of heavy regulation and high taxation.[3]

In foreign affairs, the shock waves from the North Korea nuclear problem continued to rumble through America’s relationships in Asia. China has supported and protected North Korea as a way of advancing its own agenda. President Barack Obama’s policy of strategic patience put off action in hopes that “something will turn up.” While a wise policy at the time (like the pursuit of a nuclear deal with Iran), North Korea’s gains in nuclear weapons and missiles have now made that policy obsolete. There are tens of thousands of American troops stationed in both South Korea and Japan. The United States has defensive alliance with both countries. A North Korean attack on either one is likely to kill a lot of Americans and would require an American response. Hillary Clinton would have faced the same difficult choices as does Donald Trump. It will be necessary to give China something if it reins-in (or overthrows) the North Korean lunatic-in-office. To off-set any concessions to an expansive China, the Trump administration has sought to rally America’s allies in Asia. To this end, Trump invited the homicidal Philippine president Rodrigo Duterte to visit the White House, and ordered the Pentagon to move an anti-missile system to South Korea.[4]

A minor furor arose over President Trump’s question to an interviewer “Why was there a Civil War? Why could that one not have been worked out?” It’s a fair question that has pre-occupied academic historians for generations. While heaping abuse on the historically-ignorant president, his critics seem to have missed reading Abraham Lincoln’s Second Inaugural Address.

[1] “Congress agrees on spending deal,” The Week, 12 May 2017, p. 6. Will President Trump be willing to force a shut-down in September as a way to shoulder his way back into a bargaining process in which mainstream Republicans are willing to ignore his priorities?

[2] “Trump’s tax plan: Who would benefit,” The Week, 12 May 2017, p. 8.

[3] “Issue of the week: Looking for a ‘Trump bump’,” The Week, 12 May 2017, p. 38.

[4] “Trump’s hand of friendship to Philippine strongman,” The Week, 12 May 2017, p. 7; “How they see us: Trump diplomacy rattles South Korea,” The Week, 12 May 2017, p. 17.

Talking Turkey.

Posted on May 9, 2017 by jsh54

To rehash the well-known, the Islamic State (ISIS) seized a lot of territory in eastern Syria, then broke out into western Iraq several years ago. This encumbered the fair hopes of the Obama administration to beat a dignified retreat from the Iraq mess. Destroying ISIS at minimal costs in American lives became the policy choice of the Obama and Trump Administrations. That grinding effort, which has involved a lot of work by both the Kurds and the Iranians, looks about ready to pay-off with the Iraqi capture of Mosul and the Syrian Kurds’ capture of Raqqa (the capital of the ISIS caliphate).

To rehash more of the well-known, the Kurds are a Muslim ethnic group divided between Iran, Iraq, Syria, and—fatally—Turkey. Kurdish nationalism threatens to disrupt these countries. The Turks, in particular, see their own Kurdish political party (PKK) linked to the Syrian Kurdish political party (PDK) and to its American-armed militia (YPG).[1] They’re probably right.[2] Iraq’s wing of the PKK has attacked Turkey in support of its Turkish partners. Hoping to earn American patronage for their ambitions, the Kurds of Iraq and Syria have done much of the heavy lifting in the fight against the Islamic State. So, it is important to keep the Kurds happy.

To rehash still more of the well-known, the president of Turkey—Recep Tayyip Erdogan—is a moderate Islamist head-case who is bent on turning the country into a Sunni version of Iran. He barely scratched out a majority in a referendum on super-charged presidential powers in April 2017, yet he sees the vote as an endorsement of his ambitions.

This puts the United States in a bit of a quandary.[3] Over the short-run, who cares what the Turks want? The militia of the Syrian Kurds, the YPG, is seen by American military leaders as the best bet to capture Raqqa. American military leaders also see Turkey as having no real alternative strategy. So when Turkey bombed several YPG positions and threatened land forces incursions, the US military began running convoys of American military vehicles flying large American flags through the target area as a warning to Turkey.

Over the long-run, many people should care what the Turks want. On the one hand, Erdogan is an anti-Western Islamist. He is aiming at a dictatorship. His victory in the referendum on expanded presidential powers fell far short of the expected majority and is dogged by charges of fraud. Political turmoil seems the likely future for Turkey.[4]

On the other hand, Turkey is a member of NATO (brought in to the alliance, in part, because Greeks won’t fight). Turkey has the second largest army in NATO; it is an industrializing country; it has sought membership in the European Union (EU), and the Turks have been extending their cultural influence through the southern tier of states liberated by the collapse of the Soviet Union. Erdogan has battered Europe with an engineered refugee crisis. The European Union is never going to admit Turkey to its ranks, even if it has to soak up huge numbers of outsiders without Emma Lazarus to provide a moral justification.[5] He has both barked at and cowered before Vladimir Putin. He is afraid that the U.S. has struck a bargain with the Kurds. And he will visit Washington in May 2017. The regional implications of Turkey’s course matter far more than do the headlines about ISIS.

[1] If the Kurds get Russian military assistance, maybe they could be re-branded as the RPG?

[2] The Americans engage in a lot of hair-splitting over this issue. The U.S. government insists that Turkey’s PKK is a terrorist organization, while Syria’s PYD and—even more—the YPG are not terrorists. Instead, they are “partner forces.” Which people can read as “allies” or “hired guns” as is their wont.

[3] Yarolslav Trofimov, “In Syria, U.S. Is Caught Between Ally Turkey and Kurds,” WSJ, 5 May 2017.

[4] Yaroslav Trofimov, “Erdogan’s Narrow Win Could End Up Undermining Him,” WSJ, 17 April 2017.

[5] A “wall” is more likely.

Looking Back on the Obama Administration.

Posted on May 2, 2017 by jsh54

“America is a better, stronger place than when we started,” President Barack Obama declared in mid-January 2017. He pointed in particular to the Affordable Care Act (ACA), the triumph of marriage equality through the action of state governments and the federal courts, and the Paris climate agreement.[1] Moreover, the president had sponsored a bail-out of the car industry and passed an $800 billion stimulus bill.[2] Over the course of Obama’s two terms, unemployment fell from 10 percent to 4.7 percent as the economy created 11.3 million jobs. (That’s 1.4 million jobs a year.) He left office with an approval rating of 55 percent, while eorge W. Bush had a 33 percent approval rating.[3]

In foreign policy, President Obama won the Nobel Peace Prize, pulled out American troops from Iraq, resisted pressure for full-on U.S. intervention in the Syrian civil war (even when Bashar al-Assad was accused of having used chemical weapons).

Not everyone agreed, even when they liked the man and his accomplishments. President Obama’s decision to slight recovery from the “Great Recession” in favor of creating a costly new entitlement for the poor doomed the country to prolonged economic stagnation. His reliance upon executive orders, instead of legislation that could not be passed through a Republican Senate, means that many of his achievements can be rolled-back.

Race relations deteriorated during the Obama administration, for reasons that had little or nothing to do with President Obama. Many controversial incidents of police violence (Trayvon Martin, Michael Brown, etc.) cast a harsh light on race relations. This led some critics to complain that Obama had adopted too moderate a stance. Infelicitously, the out-going president claimed that people who voted for Donald Trump rejected “people who [don’t] look like them.” Some took this as a veiled charge of racism.[4]

The popular referendum on the Obama Administration seems harshly negative. In the 2016 election, the Republicans won the Presidency (through the Electoral College, rather than through the popular vote.) They also won 63 seats in the House of Representatives, 10 seats in the Senate, and a dozen state governorships. This continued a three-election trend.

In explaining the Democratic defeat in the 2016 election, liberal observers lamented the rising tide of authoritarian populism that had brought Donald Trump to the White House.[5] They also lauded the economic situation which existed at the end of the Obama administration as a gift to the Trump administration. None of this did Hillary Clinton any good.

Other observers seemed to feel relief at the end of eight years of what they regarded as self-righteousness on the part of President Obama. “If you didn’t agree [with him], you were on the wrong side of history,” wrote one conservative critic[6] A liberal author agreed that the president’s “tendency toward high-minded superiority” put off many people.

There’s a difference between the “Bully Pulpit” and the “Bully’s Pulpit.”

[1] “Obama’s farewell: ‘Yes, we did’,” The Week, 20 January 2017, p. 5; “Obama’s legacy: Hope, change, and disappointment,” The Week, 20 January 2017, p. 16.

[2] Having bailed-out the car industry, President Obama went on to campaign against greenhouse gases. Paul Krugman, currently a scourge of Republican “serious people,” then criticized the Obama stimulus pl n as half as large as was needed and spread over two years instead of front-loaded into one.

[3] The invasion of Iraq and all that followed; Hurricane Katrina’s destruction of New Orleans; the “Deepwater Horizon” oil drilling blow-out.

[4] “Obama’s farewell: ‘Yes, we did’,” The Week, 20 January 2017, p. 5.

[5] “Obama’s farewell: ‘Yes, we did’,” The Week, 20 January 2017, p. 5.

[6] “Obama’s farewell: ‘Yes, we did’,” The Week, 20 January 2017, p. 5.

Memoirs of the Addams Administration 17.

Posted on April 29, 2017 by jsh54

The Republican Congress debated a new version of the American Health Care Act (AHCA) which had failed in March 2017. The same dispute between the Freedom Caucus in the House and the moderates in the Senate that wrecked the AHCA remained unresolved. The Freedom Caucus did deign to accept an amendment that dumped the Affordable Care Act (ACA) requirement that insurers cover pre-existing conditions. Millions of voters will have their say on this matter in November 2018. Tick, tick, tick.

With the Republican Congress inert, President Trump acted through executive orders on a number of fronts. On trade, he imposed a tariff on some Canadian lumber and talked about withdrawing from NAFTA. On natural resources he reversed some late-stage Obama administration designations of Western areas as national monuments and reversed some limits on off-shore oil drilling. On taxes he sketched a plan for change: cut the corporate tax from 35 percent to 15 percent; reduce the number of tax brackets from seven to three (paying 10 percent, 25 percent, 35 percent); double the individual deduction (so that the first $24K of a couple’s income escapes taxation). The worm in this enticing apple is a loss of $3 trillion in revenue over ten years for a country already mired in red ink as far as the eye can see.[1] On immigration and labor, Trump issued an order requiring greater scrutiny[2] of H-1B visas for skilled workers.[3] Faced with the prospect of a government shutdown over the appropriations bill in Congress, Trump dropped his demand for money for the wall along the Mexican border.[4]

The Trump orders surfaced a number of important issues. On immigration, are we obsessed about Mexican illegals gobbling up the jobs that Americans don’t want to take? Or are we worried about the unwillingness of Americans to embrace Science, Technology, Engineering, and Mathematics (STEM) when those are the keys to the future economy? Or are we afraid of a handful of Muslim immigrants providing cover for a few radical Islamist terrorists?

On taxes, will tax cuts spur growth? Or are they just a way to fend off federal seizures of private property? We say “one man, one vote.” Why not “one man, one tax rate”? Are huge deficits a problem or not a problem? If they are a problem, then who should sacrifice to reduce them? Just the people who do not benefit from the spending or Americans more generally?

On natural resources, for better than a century (c. 1790-1890) the federal government sold off public lands in order to raise revenue and to promote both economic development and social mobility. Really only in the 20^th Century did the government turn to a policy of “conservation.” The government stopped selling public lands. Since then, people have argued over “preservation” (leave God’s Creation in pristine condition so that people can commune with Nature to restore their souls) and “conservation” (treat water, grasslands, forests, minerals as a more or less renewable resource that can be harvested). There’s a lot to be said for each argument. Especially if you have ever seen a clear-cut or camped in a mountain pass with not another human to be seen, or if you have lived in a mill town and seen the modest lives of natural resource workers and talked with well-off Easterners about their week-long vacation in the West.

Nothing about the issues facing the Trump administration are trivial.

[1] Do tax cuts stimulate sufficient economic growth so that overall revenue equals or surpasses the pre-cut level? It seems not to have been the case with the Reagan tax or the Reaganesque tax cuts of succeeding Republican administrations. However, I—or someone—should read about the Mellon tax plan of the 1920s and the Kennedy-Johnson tax cut of the 1960s.

[2] That is delays and restrictions.

[3] “Issue of the week: “The trouble with ‘Buy American’,” The Week, 5 May 2017, p. 42.

[4] “Trump’s flurry of major proposals,” The Week, 5 May 2017, p. 6.

Memoirs of the Addams Administration 16.

Posted on April 28, 2017 by jsh54

Evidence continued to pour in of President Donald Trump’s fast climb up the learning curve. China provides critical aid to the failed state on its border and has used North Korea’s belligerence as a leashed pit-bull in its own efforts to expand its power. Thus, Chinese action will be decisive in efforts to change North Korean behavior short of war. Confronted with the danger of North Korea, President Trump consulted with Chinese President Xi Jinping. Inevitably, there is a price for Chinese co-operation. After his meeting with Xi, Trump changed course from denouncing China as a currency-manipulator that had been “raping” the United States to claiming that China did not manipulate its currency. In Syria he took a middle course between the non-intervention policy of the Obama administration and the deeper engagement urged by Hillary Clinton by ordering a one-off cruise missile attack on the air-base from which a poison gas attack had been launched on rebels.[1]

Even before Trump became president, the Affordable Care Act (ACA) faced problems.[2] Many younger people refused to enroll, and the health care markets are served by a shrinking number of providers in some states. Trump began to revive the “repeal and replace” campaign after its earlier defeat. It isn’t clear yet whether the Republicans’ Freedom Caucus and moderate factions can agree on a new plan. If they cannot, then peeling-off some Democrats becomes vital. Moreover, winning some Democratic support enhances the bargaining power of the moderates against the Freedom Caucus.

To this end, Trump tried to exert pressure on the Democrats. Before the election, Republicans had sued the Obama administration to stop federal subsidies to low-income clients on the insurance exchanges. A federal court had sided with the Republicans, so the Obama administration had appealed to a higher court. The payments continued while the court pondered the issue. Eager to pass a replacement health-care plan, Trump threatened to stop defending the government’s position in the law suit. That might cause the court to reject the Obama administration’s appeal. Without the subsidies, the ACA’s market places will collapse. This threat, in turn, might cause many insurers to abandon the market place so that they don’t get blind-sided in the coming year. Trump intended this prospect to force Democrats to bargain.

A similar kind of maneuvering may be appearing in economic adviser Gary Cohn’s flirting with the idea of restoring the Glass-Steagall Act. Glass-Steagall formed part of Franklin D. Roosevelt’s first Hundred Days legislative push in 1933. The Act separated investment banking from commercial banking. Investment banks used their own capital to invest as they pleased, often running a higher risk of failure. Commercial banks just took deposits and made ordinary loans. Merging the two into one bank increased the risk of systemic failure if riskier investments failed on so great a scale as to imperil the savings of ordinary people. Glass-Steagall made banking “dull” from the 1930s to the 1990s, when the Clinton administration pushed through repeal of the Act. This repeal has entered liberal mythology as an important factor in the financial crisis of 2008. Cohn’s suggestion that it could be restored may be part of an effort to make a larger de-regulation of the financial industry, including repeal of the hated Dodd-Frank legislation, palatable to a wide range of voters.[3]

Is Trump a flim-flam man, or an intuitive applause-seeker, or a creature of his competing factions of advisers, or just an unscrupulous in-the-closet conservative Democrat?

[1] “Trump: What do his flip-flops reveal?” The Week, 28 April 2017, p. 18.

[2] “Obamacare: Trump ponders sabotage,” The Week, 28 April 2017, p. 19.

[3] “Issue of the week: Will Trump break up the banks?” The Week, 28 April 2017, p. 38.

Memoirs of the Addams Administration 15.

Posted on April 21, 2017 by jsh54

Critics of President Donald Trump elaborated on the well-established trope that Trump is too inexperienced and shallow to manage national security—or anything else.[1] In some minds, his foreign policy decisions rely too much on the former military officers in key positions (Secretary of Defense James Mattis, National Security Adviser H.R. McMaster). In other minds, the reported battle for influence over President Trump between chief strategist Steve Bannon and Trump’s son-in-law Jared Kushner obscures a real slide toward the center under the influence of McMaster and Gary Cohn.[2] In this view, the failure of the “Muslim ban” and the failed effort to “repeal and replace” the Affordable Care Act undermined ideologically-driven advisers and awakened the President to the complexities of many issues. Better late than never, and it isn’t even late yet.

One potentially powerful influence on the future course of the Trump administration may be the evident gap between the campaign positions of Donald Trump and the current opinions of the majority of Americans.[3] In the case of immigration, only 13 percent of Americans want the deportation of illegal aliens to be the first order of business and only 26 percent think that stopping future illegal immigration is very important. In contrast, 90 percent favor legalizing the situation of illegal immigrants who have jobs, speak English, and pay their back taxes; and 60 percent think that the legalization of such illegal immigrants should be at the top of the immigration policy list.[4] It’s worth noting that the supporters of legalization of status don’t seem to have been asked about a path to citizenship. Maybe green cards without any path to citizenship would do it. In any event, the weight of public opinion provides a lot of ammunition for the “moderates” around President Trump.

A comparatively small incident in foreign policy provided the basis for a change of course. The Syrian air force allegedly used sarin gas in an attack on a town in Idlib province. President Trump then enforced President Obama’s “red line” warning from 2013 by ordering a rain of cruise missiles on the air base from which the attack was said to have originated. It would be difficult to make Syrian-American relations worse, but the incident pushed russo-American relations down-hill. Secretary of State Rex Tillerson had a tense visit to Moscow, while the Russian foreign minister Sergei Lavrov warned the Americans not to make another such “illegal” attack.[5] The Americans havered a bit, with Tillerson renewing the Obama administration’s insistence that Syrian dictator Bashar al-Assad had to go, while Secretary of Defense James Mattis said that the U.S. would not be drawn deeper into the civil war.

A majority (57 percent) of Americans approved the strikes. As was the case with President Obama’s failure to follow through on his red line warning in 2013, the great majority of Americans (70 percent) believe that President Trump should seek Congressional approval for any further attacks on Syria.[6] So, apparently, Americans will back the president, but then wish Congress would follow its constitutional duty. Critics in the New York Times and the Washington Post complained that Trump has yet to articulate a comprehensive strategy for asserting American predominance in Syria. (In short, he’s all action and no talk.)

[1] “Syria: Is there a new ‘Trump Doctrine’?” The Week, 21 April 2017, p. 6.

[2] “Bannon vs. Kushner: The battle for Trump’s soul,” The Week, 21 April 2017, p. 17.

[3] See: https://waroftheworldblog.com/2017/04/12/public-opinion-in-the-addams-administration-1/

[4] “Poll Watch,” The Week, 31 March 2017, p. 17.

[5] “Syria attack widens U.S.-Russia rift,” The Week, 21 April 2017, p. 4.

[6] “Poll Watch,” The Week, 21 April 2017, p. 17.

Public Opinion in the Addams Administration 1.

Posted on April 12, 2017 by jsh54

It has become an age of bitter political polarization. Everyone says so. To take one small example, in January 2017, 16 percent of Democrats believed that Donald Trump was following ethics laws; 79 percent of Republican believed that Trump was complying with the laws.[1] A month later, almost half (46 percent) of Americans wanted Donald Trump impeached.[2]

If the conventional wisdom is true, what is to be made of the areas of broad consensus in the American public? Take four examples: allegations about the election of November 2016; climate change; health care, and abortion.

Almost three-quarters (70 percent) believe that President Barack Obama did not have Donald Trump’s communications tapped. Fewer than one in five (19 percent) of Americans believe that President Obama had intelligence agencies wire-tap Trump.[3] That leaves 11 percent “not sure.” Almost two-thirds (63 percent) of Americans saw Russia’s intervention in the presidential election as a “serious” issue. Well over half (58 percent) of Americans believed that the allegations should be investigated by an independent prosecutor, while more than a third (35 percent) opposed an independent investigation.[4]

In 2015, only 27 percent of Americans described themselves as “believers” in climate change. By early 2017, 50 percent described themselves as “believers.” Another 31 percent believe in climate change, but think that it has been exaggerated by environmentalists and the media.[5] Almost two-thirds (65 percent) of Americans support the development of alternative energy sources, while just over a quarter (27 percent) support the development of fossil fuels.[6]

In 2016, 51 percent of Americans believed that the government should ensure that all Americans have health-care. By early 2017, 60 percent believed this, while 38 percent believed that it is not the government’s job.[7] As the Republican “repeal and replace” of Obamacare got moving, virtually all (96 percent) of Americans believed that it was either “somewhat” or “very” important that all Americans have access to affordable health insurance. This included virtually all (91 percent) Republicans. Almost as large numbers (84 percent) believed that the Affordable Care Act should not be repealed until a suitable replacement was ready.[8]

Finally, over half (54 percent) of Americans want the Supreme Court to uphold Roe v. Wade, while less than a third (30 percent) want it overturned.[9]

So, if you leave it to ordinary Americans, women would retain their right to choose whether to bring a child into the world. If you leave it to the Supreme Court, that may not be the case. Of course, the Court might take the position that it does respect for the law in general no good if the courts drive huge numbers of people into disobeying a particular law.

The ground has shifted under the feet of the Trump administration (and the Republican Party) on climate change and health-care. Their best course may be to pursue market-based policies to address both issues. That is, declare “victory” and get out.

Democrats and Independents, if not every Republican, can smell a rat.

[1] “Poll Watch,” The Week, 27 January 2017, p. 17.

[2] “Poll Watch,” The Week, 24 February 2017, p. 17. They probably expected him to be replaced by Hillary Clinton.

[3] “Poll Watch,” The Week, 7 April 2017, p. 17.

[4] “Poll Watch,” The Week, 17 March 2017, p. 17.

[5] “Poll Watch,” The Week, 7 April 2017, p. 17.

[6] “Poll Watch,” The Week, 24 February 2017, p. 17.

[7] “Poll Watch,” The Week, 27 January 2017, p. 17.

[8] “Poll Watch,” The Week, 10 February 2017, p. 17.

[9] “Poll Watch,” The Week, 17 February 2017, p. 17.

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