Bad deal. And now what?

The Senate has passed a bad deal. I think the Democratic Senators expect the House will turn it down.

…and what will they do if the House Republicans break rank and vote with the Democrats? They might. Obama may be trying for that.

Saltwater, Freshwater, academic discussion

Wow. Links from big-name bloggers really get attention. The original post in this series got a noticeable spike in pageviews, and some people even clicked through to the original Brad Delong interview.

It also sparked some serious discussion among academic bloggers, which Noah Smith (Noahpinion) chronicled. I haven't followed it all, though I do note that Prof. Williamson continues the freshwater tradition of contempt for critics from the saltwater school by calling Prof. Krugman deranged.

Socialism, Keynesianism, and Hayek

Hayek, quoted by Brad Delong, in the context of the validity of regulation:

[…] the most important change which extensive government control produces is a psychological change, an alteration in the character of the people. This is necessarily a slow affair, a process which extends not over a few years but perhaps over one or two generations […]

My comments, first made on Prof. Delong's blog:

But how could he validate this hypothesis? He did not have one or two generations of data to back it up and history was no guide; there had never been anything like a 20th century industrial economy in history. In this, he sounds remarkably like the current freshwater economists arguing that hyperinflation and an explosive rise in interest rates are around the corner, any day now.

There is also the problem of what is meant by “socialism.” Is the pursuit of full employment by policies based on Keynesian theories socialism? So far as I know, most political socialists, then and now, say not. Socialism is a political as well as an economic idea, and socialists are uncomfortable seeing some of their goals realized without a political victory. On the other hand, there is Keynes famous remark about “a somewhat comprehensive socialisation of investment.” Would a society which pursued full employment and various social benefits through a benevolent ruling class have the same effects on the character of the people as a democracy which did so? By Hayek's reasoning, apparently yes; only a full-on anarchy would escape the destructive effects of “socialism.”

I don't think the terms are well-enough defined for scientific reasoning; we don't know what is lasting and what is an evanescent political phenomenon.

Croak of Yesterday

“So we're going to hit the debt ceiling then go off the fiscal cliff. I assume an anvil lands on us after that.”—@pourmecoffee@twitter

And God Jul to you all in 2012

May the next year be better!

The Shift in the US Two-Party System

There is a split between the Tea Party and Wall Street Republicans, and the conservative and liberal Democrats.  The Wall Street Republicans and conservative Democrats are the current governing coalition, the so-called "centrists." The Tea Party Republicans act as a blocking opposition. Since the House Republicans can't pass legislation, the Wall Street Republicans might be enticed, perhaps by Obama's Grand Bargain, to vote with the Democrats and ultimately become Democrats.

This would entirely freeze out the actual center, let alone the progressives. It is hard for me to imagine that Tea Party Republicans would form a coalition with liberal Democrats, so I suppose that both groups will be powerless for some time. Long-term factors that are likely to lead to such a coalition, however, might be: (1) a labor market with employment improving but salaries remaining low; (2) abuses of the PPACA on the part of the health insurance industry; (3) environmental difficulties and disasters, especially those affecting agriculture and major cities; (4) the domestication of drone surveillance and policing; and (5) the continued growth of the national security state. Demographic changes might also shift the balance in the favor of the liberals, but only if a liberal leadership emerges around major issues like the five I listed above.

Hoisted from comments: on the Economic Computation Problem

Jay Ackroyd writes:

These comments are actually inspired by a blog post I read a couple of years ago that I can't possibly find. (Stuart might be able to.)

In it, the policy economist expressed surprise and dismay that a mathematically oriented new classical guy actually took the results of his calculations literally, instead of subjecting them to an Econ 101 evaluation and rejecting them as, well, naive and stupid.

This was telling, doubly, because first, the policy guy was criticizing the competence of the math guy but, second, because he was admitting that these models really don't work.

Or at least, that the models aren't applicable without thought and results have to be checked. Hunh.

For a long time, I've been quoting Robert Solow's Growth Theory, where he describes "stylized facts." I don't think macro can go beyond that--that there are some general principles you can apply, but you can't push them too far. Rigor really isn't possible. (There are good, rigorous reasons in the literature to support this, by the way. The New Classical critique makes some of these arguments. Others are old, like the "adding up" problem. There's no way to add up the preference orderings of a collection of consumers in an economy to arrive at an aggregate demand number. This is at the heart of the NC "where are the people in this model?" critique of Keynsians.)

So in your view, the unpredictability of human behavior invalidates some models, the way it does in some design disciplines. In design, there are problems which can be solved by computation—Will the building stand up? Can this result be computed?—and problems which can only be solved by testing with humans—Will people like this building? Will people be able to navigate this interface? Some designers get good at devising first cuts at such things, but even that group has to test their work with actual humans.

Is it perhaps that the dream of an economic system that is like a machine that computes the best way to satisfy human needs is simply not achievable? This is a criticism which is usually directed at Communism, but in the end the "free" market is another mechanistic solution.

Keynesian economics suggests that an economic system that maintains both good levels employment and production requires governance and therefore must be integrated into a political system. Given that Keynesian economics is valid, what might Keynesian institutional forms be?

[Editorial changes made for clarity on the day of publication.]

Is this the end of the Republican Party?

Last night brought the news that the Tea Party and centrist factions of the Republicans have split, and are unable to agree on a budget. Is this, perhaps, the end of the Republican Party? Did the Republicans just go the way of the Whigs?

Well, it is 12/21/12.

Saltwater, Freshwater, and OMG! Paul Krugman linked me

A brand new post for new discussion of "Saltwater, Freshwater, and Economic Policy: a reaction to a Brad Delong interview." No moderation delay here.

And thank you to Paul Krugman for the link!

A Bad Day For Freedom

Syria shuts down internet and cell phone connectivity: (#SyriaBlackout.) BBC. Atrocities, presumably, to follow.

Reuters: Egypt constitution finalized as opposition cries foul. Morsi rammed it through. There seems no English-language translations yet, or even detailed summaries, but "The draft injects new Islamic references into Egypt's system of government but keeps in place an article defining 'the principles of sharia' as the main source of legislation - the same phrase found in the previous constitution" and "activists highlighted other flaws such as worrying articles pertaining to the rights of women and freedom of speech." Still haven't seen a full analysis in English, though.

In other news, the UN has recognized Palestinians as a state, effectively endorsing a two-state solution, but they are a state with little territory. Whether this is a positive or negative remains to be seen. At least, it is a strong rebuke to Israel.

Saudi Arabia Implements Electronic Wife-Tracking System

This is right out of The Handmaid's Tale: Time magazine reports that the Kingdom of Saudi Arabia has introduced an electronic tracking system alerting male guardians when a woman has left the country.

Widespread cybersecurity, it seems, is a necessity of freedom.

On the formation of third parties in the USA

Blog comment to a libertarian.

The US electoral system is set up so that building up enough votes for a third party to win means losing multiple elections to the opposition. Trying to build up, say, a Libertarian vote means losing elections to the Democrats, just as trying to build up a Green vote means losing elections to the Republicans. It's hard to hold a third party vote together long enough to get anywhere in the US system. The only time it was ever been done is when the Whigs split over slavery, when the Republicans became the second party, replacing the Whigs, and then the only reason the Republicans won the Presidency was because the Democrats split over slavery again.

Now, if the instant runoff or range voting was used, and then proportional representation, matters would be different—a vote for a third party would have less of a chance to put your opposition in power. Over to:

• The Center for Voting and Democracy (http://www.fairvote.org/), which advocates the instant runoff, proportional representation, and several other voting reforms.
• The Center for Range Voting (http://rangevoting.org/).
• Common Cause (http://www.commoncause.org), which has been working on money and media issues since 1970s.
• Professor Douglas J. Amy's proportional representation archive (https://www.mtholyoke.edu/acad/polit/damy/prlib.htm).

Third Parties in American: Shared Sacrifice

How much pain is the "Vote, even though it helps the Republicans" faction willing to put the country through?  How much sacrifice?  It's the problem of third parties in America that to establish themselves, they have to allow their opponents to win. By the time a new progressive party established itself in the current electoral regime, the Republicans would have held power for at least a decade--that is, if the NPP's members were allowed the vote by the end of that time. But it is more likely long before that time, the hopeful third party would have fallen apart.

I think we'd do better to work for electoral reform, and hope that the Zombie Party falls over from a deficit of brains.  Maybe we can give it a push.

I Seriously Do Not Get Conservatives

I wrote this on a blog in response to a conservative woman planning to vote for Romney, despite her arguing that the candidates are equally poor. I like it enough to reproduce it here.

You ignore Romney's appalling lack of integrity to set up your equivalence between the two candidates. He is sexist, racist, and homophobic—again, why any woman would support someone so sexist, I do not understand. Romney has a record as a businessman and a politician. He has repudiated all of it to win the Presidency and then repudiated his repudiations. He has changed his positions not just once, but multiple times. The only policy goals he has reliably supported are lower taxes for himself and his class, and less regulation on his business activities, and those of his class.

I see no indication of political courage in the man, and if he has any honor, it is reserved for his small group of peers. As someone from a military family, why would you want to see someone with so little honor and integrity as commander in chief?

Turning to Obama, I am struck by how little he has lied.  He has dissembled, he has misdirected, he has stonewalled—he is after all a politician. But he seldom has lied outright.  I am not sure he ever has, except in the slanders of conservative commentators.  I am surprised how little of their own ideals conservatives see in Obama.  Distressingly, it appears to me that his egalitarianism and his skin color trump his conservative virtues in conservative eyes.

Later thought: this is actually very interesting. Obama is honest. How unusual is that?

This is, more than anything else, an election about identity.  Romney is the candidate of Wall Street and the rich old white guys; Obama is Wall Street's less favored son and the candidate of everyone else.

Turning to policy issues…

To begin with there is no left of any power in the USA. The Democrats are a conservative party with a weak liberal wing; the Republicans have come to be dominated by the radical right. This is not hard to see. The Tea Party Republicans are routinely on television. Their ideas have been aired repeatedly and some of them have even found their way into the Republican platform. The Democrats treat Occupy, the only publicly visible left, like it has leprosy. Their ideas have seldom if ever, gotten air time on a major network. Grover Norquist controls the votes of most Congressional Republicans on taxes. See any radical leftist policy advocates with similar power? Seen Congresspeople quake in their boots when they speak?

Me neither.

Second, why do you credit conservative economic analysis? It has had a 30 year run that has impoverished much of the country and ended in a depression.The same economists who are predicting the doom you describe are the ones who have been—for four years now!—predicting an explosive rise in interest rates and hyper-inflation. You see those high interest rates and hyper-inflation?

Me neither.

Conservative economists have revealed themselves as unscientific political hacks, and it is time to start treating them like flat-earthers.

A sub-point here: If Obamacare is going to be as destructive as you claim—why do you trust Romney to make health care policy? Romney was for Obamacare—invented it—before he was against it.

Third, why is a World War II level of military readiness necessary to the USA? Is there an enemy comparable to Nazi Germany or Imperial Japan? We are ready to fight World War II again, yet future global conflict will not be World War II again.

Einstein frequently remarked that we do not know with what weapons World War III will be fought, but that World War IV will be fought with rocks. For some centuries wars have been increasing in intensity. We are now at a level of military technology and organization where a global conflict will destroy civilization, and perhaps even the future chances of a revived civilization. The national security of the United States depends on a reduction in global tensions. You see any conservative advocates of global peace and justice?

Me neither.

Actually, there are a few. The economist Jeffrey Sachs comes to mind. And of course there is (redacted), in this discussion.

I seriously Do Not Get conservatives.

I am writing, I suppose, to underscore some of the contradictions I see. I have little hope of changing anyone's mind at this time, but I hope I will influence thinking in the future. Right now, like the crying girl in the YouTube video, I just want to get through this election.

About the Voters

It occurs to me that this election is about the voters, more than the candidates. The Republicans are now the party of conservative rich old white guys. The Democrats are the party of everyone else. If the party of the conservative rich old white guys wins, everyone else will be shut out, possibly even denied the vote. Seen that way, there's a clear and simple choice. We are fighting over the basic rights of citizens of a democracy, and while the major parties have moved closer together, their voters have not. In the voters, I think, the hope lies; not in the party leaders.

Croak!

Lesser Evil

"Of course you can vote for the lesser of two evils. You get less evil."--Chomsky, 2008

It seems to me that on the left we need to work for three things:

1. Time. Time and demographics are on our side.  This is why you vote for the lesser evil.  If the centrists will bring us to the hard right by 2025, that is 13 years for us to change the direction of the country and, with a majority the younger popular and more and more women on our side, we might pull it off.
2. Unity. It is often forgotten by well-off white men that this is an election about whether anyone counts politically other than old wealthy white guys but women, blacks, and gays can hardly forget.
3. Electoral reform. We need to make as much space as possible for a new party to the left of the conservative party the Democrats have become.

And this against the backdrop of the biggest threat to the social safety net in 50 years. Thanks, conservatives!

We're For It Now!

What Digby Said.

The President has promised a "grand bargain" on Social Security, Medicare, and Medicaid after the election—he said so in the debate. Pete Peterson and the billionaires for austerity are putting on a full-court press press (sic.)

What do these people think they are doing? If this goes through it's going to fail, it's going to fail in the same way it is failing in Europe, and it's going to leave no country except possibly China standing. This is insane, even for the very wealthy.

With luck, it will all come apart. This is electoral poison, even for the absurdly entitled Senate. My guess is that Social Security will stand, Medicare will get some cuts, and Medicaid is going to get very badly hurt.

Food!

[edited a few days after posting.]

Identity Crisis Politics

The War on Women, Blacks, Muslims, and just about everyone else...

The push to see the United States as the Christian nation it never was...

The dispute over Obama's citizenship...  (And here I thought legitimacy disputes only occurred in hereditary monarchies.)

The primacy of identity over policy is the defining feature of this election.  It is a feature of all US elections, but this year the election is about identity.  This despite huge policy issues: unemployment, war, climate, and on.  And yet the country is having an identity crisis.  It is as though the public is trying to fix a leaky roof by undertaking psychotherapy, and all the while the roofer is busy stealing the family jewels.

Older white Americans seem to feel they've lost themselves in all the changes that have taken place since 1960, and they want the mythical past back.  Everyone else is glad of the changes, or at least was until the wealthy old white guys were allowed to return to abusing everyone else back in the 1980s.

And so we have a conservative black president and an election about identity.  As a progressive bird, it surprises me that the wealthy old white guys get so much support.  Yet it just may be that the identity issue is the one to deal with.  If it isn't resolved, and in favor of the whole public rather than just wealthy old white guys, policy is only going to get worse and worse. 

Meantime, the wealthy old white guys are robbing the rest of America blind.  I wish America would finish up with the identity crisis and get on with it already.

Breaking news: Romney may just have pushed the country a giant step on the path with his "47%" remark.

[Minor edits and rewrites within 24 hours of publication.]

The Worst Thing the Obama Administration Has Done?

(This is a collection of links about the response of the Islamic public to the vaccination scam the CIA ran as part of its assassination campaign against Usama bin Laden. I wrote them up for Ta-Nehisi Coates's blog, and decided they were worth repeating here. [Added:] these were flagged as offensive and not restored. Bah!)

Every time I think I'm getting to accept the Obama Administration, I'm reminded of something else awful it has done. My latest reminder was yesterday, when I read that Pakistan is deporting the non-Pakistani staff of Save the Children as probable CIA agents. As part of the assassination of Osama bin Laden, the CIA ran a fake vaccination campaign in Pakistan, vastly undercutting the already uncertain Pakistani trust in real vaccination campaigns. Recently, Pakistan ordered all foreign employees of the Save the Children foundation out of the country on the grounds that they had been suborned by the CIA. It is possibly just grandstanding. On the other hand, it is possibly true: Save the Children is not likely to have the kind of hiring process that would detect an agent undercover.

It made the papers.  Guardian story. AP story.

We also have Dr. Anthony Robbins, co-editor of the peer-reviewed Journal of Public Health Policy: editorial at JPHP and backgrounder at ScienceBlogs.

It's not the action of the Pakistani government that most disturbs me, it's the disruption of the already fragile trust of Western NGOs on the part of the public in Islamic states. People will die because of this. Polio could be eradicated in Pakistan if the Pakistani people trusted the aid workers, and what trust there was has been badly damaged.

David Wright, Save the Children Pakistan country director, quoted in an editorial from The News of Islamabad, Pakistan, "Our ability to continue this important work has been seriously undermined by CIA’s use of humanitarian activity as a cover for their intelligence gathering."

BBC article from before the deportation: "UN polio vaccine doctor injured in Karachi attack"

Al-Jazeera on Taliban opposition to the program.

One of the most discouraging things about this story is that the Administration and the CIA have made the Taliban's allegations true.

[Restored because the author found his guts:] If this leads to the failure to eradicate polio in Pakistan, and the ultimate failure to eradicate polio globally, it will be the worst thing the Obama administration has done. Even a sufficient delay might make it the worst.

As I said, every time I think I'm getting to accept the Obama Administration, I run across something like this.

Liars!

The Republicans seem to have decided to do nothing but lie until the election: over three two months. We're going to be crazy and sick with disgust by the end of it. Charles P. Pierce, on fire at the RNC:

It was an entire evening based on a demonstrable lie. It was an entire evening based on demonstrable lies told in service to the overriding demonstrable lie. And there was only one real story for actual journalists to tell at the end of it.

The Republicans simply don't care.

They don't care that they lie. They don't care that their lies are obvious. They don't care that their lies wouldn't fool an underpaid substitute Social Studies teacher in a public middle school, who would then probably go out one night and get yelled at by Chris Christie. ("They believe in teacher's unions. They believe in teachers," he said in his speech. Yeah, you just don't believe in paying them.) They don't care that their history is a lie and that, by spreading it, they devalue the actual history of the country, which is something that belongs to us.

They've pulled out all the stops.  They think this election will be their victory, and there will be no-one to call them to account at the end of it.

And they may be right.  They own a whole television network and have a huge staff of net propagandists to spread their lies.  The "vote fraud" lies are widely believed.  The "Obama has removed the work requirements for welfare" lies seem to be taking hold.

This must have been what the run-up to fascism was like in the 1930s, with mass media  pumping out lies and the media-induced madness setting a population against itself.  Well…it isn't the 1930s. There is some hope. But what are we hoping for? A still-bad political situation which can be salvaged? Hell of a thing to have to hope for.

Croak!

The Executions Will Continue Until Morale Improves

In the wake of three mass shootings in as many weeks, I am realizing that I wrote about this, almost exactly three years ago. I was originally writing about the hatred whipped up against health care reform, but the radical right has kept whipping up the hatred. And now…this. My original article:

The Beatings Will Continue Until Morale Improves

I think I know the bottom line: someone is going to die. Too much crazy has been unleashed, too much negativity. Mobs at town halls. Death threats. And they're going to keep stirring the pot, until some dramatic act of violence happens, until the House caves, or until the House is back in session.

"For, without a cement of blood (it must be human, it must be innocent) no secular wall will safely stand."--WH Auden, Horae Canonicae, "Vespers."

Link

It seems the leadership of the far right is encouraging domestic terrorism in the United States.

Virginia v Sibelius: Another Such Victory and We Are Undone

A collection of notes, instead of a long piece.

Winners

Health insurance companies!!!!

Yes, everyone's favorite insurance companies will make out like bandits. In exchange for a modest reduction in gross profits (to 15-20% per insured), this weakly-regulated oligopoly will get the entire country as customers, mandated by the federal government.

Pharmaceutical and medical equipment suppliers

And these firms will make out like bandits, because they'll be getting millions of new customers and are weakly-regulated.

I think I detect a pattern here.

Obama

His signature bill survived.

John Roberts

He gets to write a largely conservative decision and saves the prestige of his institution.

Losers

People in red states, especially the poor and the brown-skinned

The working poor will get slammed because the red states are planning not to implement the Medicaid expansion. There will be people who are not covered by either Medicaid or the Affordable Care Act and this group will be disproportionately brown; for an analysis, see David Dayen, link. The same states are planning not to create the insurance exchanges that the ACA mandates, despite the law. And, finally, when those states do implement the ACA, their weak insurance regulators will be the ones overseeing its implementation. In such places, the low end insurance mandated by the ACA is likely to be insurance that can't be used at prices that can't be paid.

The Economy?

No-one I have seen has done any modeling to the end of predicting the macroeconomic impact of the ACA. The ACA mandates an expansion of health care, which might be stimulative, but it is also, in effect, a tax, which might be regressive. If the effect is regressive, full implementation could make the on-going depression worse. If the depression continues, it will also fall disproportionately on the young, who will be required to spend scarce money on insurance.

The Law

The decision is exceptionally incoherent. Future cases regarding Federal power will be hard to decide. It is likely the decisions will be arbitrary, based on politics, rather than a consistent legal or ethical basis.

Progressives

Every new Federal spending program will be subject to the incoherence of this decision, the question of how will the Court rule on it.

Wingnuts 

The didn't get their cruel decision, and the 1930s and 1940s Commerce Clause decisions stand, albeit in weakened form.

And then there's that third thing

That is, people who are both winners and losers.

The middle class and working poor

Why are these people listed last? But in fact Because they are last; Congress and the President put the insurance companies's profits before the majority of the public. Some of this group will, at long last, get needed health care. Others will get costly inadequate insurance.

Young people

Who will have to pay into this system, though their incomes are low and they are the lightest users of health care. For a minority of young people, however, the mandated insurance will be a literal lifesaver.

Women

The ACA requires that a range of women's preventative care be covered without a co-pay. This is a huge thing. On the other hand, the ACA cuts insurance coverage for abortion. Again, this will probably hit hardest in red states, but in all states it is potentially a killer.

Conclusions

Thanks, guys! We really needed this mess. Why, oh why, could Congress not have seen the way clear to Medicare for All?

Corvids Feast in Denver

For those of you who have been hiding under a rock, there has been a mass shooting a the Denver opening of Batman. Twelve are dead and 58 injured. The murderer, a man named Holmes, planned the murder, and apparently also planted a bomb in his apartment, which has so far kept police out, and led to the evacuation of five buildings. It appears that Holmes played annoying music and left his door ajar, apparently in an attempt to attract  neighbors who would open the door and detonate the bomb.

The most extensive coverage is at the Denver Post. Talking Points Memo also has good coverage.

Holmes was a neuroscience student, who recently dropped out of graduate school at the University of Colorado. As usual with such people, he was a polite man who kept to himself.

I will venture the following speculations about what will be found when Holmes's background is investigated:

1. It will turn out that Holmes had a history of violent fantasies, possibly even a history of actual violence, perhaps directed at animals
2. He studied neuroscience in part because he was seeking a cure for his disorder, but it may also have given him the opportunity to cause pain.
3. His problems were recognized. It is possible he sought help for them.
4. The people who recognized his problems did not act on the knowledge, perhaps were unable to do so. If he sought help, he did not get it.

A history of violence-related mental illness would have disqualified Holmes from legal weapons purchase and ownership, if the laws regarding weapons purchase and ownership were taken at all seriously. It is as I said, years ago: you hominids will end up with the right to own weapons and nothing else.

[Update:] Yup.

Colbert to CNN, Fox: You Suck At News

The Colbert Report
Get More: Colbert Report Full Episodes,Political Humor & Satire Blog,Video Archive

Let's hear it for conscientious reporting!

On the ACA decision

Me, writing just before the decision:

I think it possible that the Court is going to rule beyond the ACA. Perhaps they will take positions that affect Medicare or Medicaid, or perhaps they will restrict the Commerce Clause in some way. Link.

And, b'golly, I called that one. Croak!  Croakcroakcroak! They did blow away the enforcement of the Medicaid expansion in the ACA, and they did it by weakening the Commerce Clause.

I guess they didn't touch Medicare because it is too popular.

The other thing that strikes me, is that like most of the major decisions of the Roberts Court, is that this decision is a mess.  We have no idea how the Court is going to rule on future social welfare programs, now that the Commerce Clause has been held as not applying to this one.  I gather the rest of the Court's conservatives rendered a blithering, blistering disaster of a dissent.  I haven't seen much reporting of it yet, but I suspect some of the ideas expressed in it are going to figure in future conservative decisions.

Meantime, let us take note that for Roberts the wealth of the 1% trumps conservative ideology, but for the rest of the Court's conservatives it is the other way.

Gonna keep us corvids well-fed, what, hey?

Civil Rights: Saving the Best Moves for the Campaign

Obama has announce that "the administration wouldn't seek to deport illegal immigrants under 30 who entered the U.S. as children and meet certain other residency and education requirements for the next two years. They also would be eligible to apply for work permits, [...]"--MSNBC

Looks to me like Obama saved his best civil rights moves for his reelection campaign: this, the end of DADT, and support for gay marriage. These are all both decent things to do, and will garner Obama votes. These civil rights moves do give a bit of hope for his second term. But only a bit. We know he’s a great salesman, but after four years we still don't know what the product is.

The Failure of Communism in Russia and Capitalism in the West

Thoughts inspired by the Crooked Timber's on-going seminar on Francis Spufford's Red Plenty and by Gordon's remark, “The dreamers and revolutionaries are still there, but now that the USSR is gone they confront a Right which has far more confidence” in this thread.

    Yet now the right is failing, drifting into ever more radical and authoritarian politics, as its policies fail. They take over powerful countries and what do they do? Impoverish those countries. Start pointless wars. Trash banking and property law systems so that even the privileges of wealth and power are endangered. And in the background, the rising storm of environmental disaster. Like the Soviet Union, this also cannot be sustained.

    I admire this sentence of Spufford's: “The theory of rule by steely, ‘conscious’ guardians of the public good arrived pre-vitiated, grotesquely self-cancelled, by having the actual representatives of the theory turn out to be beefy backslappers with the mental horizons of warthogs.” Yet no more than “steely, ‘conscious’ guardians of the public good” are there Randian super-heroes; many capitalists also have “the mental horizons of warthogs.”

    There is, I think, something wrong with our philosophies, something other than poor economic theories. It is striking to me how both capitalism and communism seem to be failing in the same way and for the same reasons.

    Perhaps we are solving the wrong problems. the 20th century has given us economic theory that could vastly improve the lives of vast majority. And yet we do not implement that theory. If both the Soviet calculation model and the Austrian market model were foredoomed by taking on too much complexity, by trying to encompass too much, what can we say of Keynesian models and the mixed economy, which, setting more modest goals, seem capable of vastly improving material life, and yet which we seem unable to implement with any resolve?

Stealing homes with a pen

"If you add all those up, I don’t think there’s a loan in America that is not touched by this in some way."--David Dayen

"When I pay it off, what will I have, [is] the most famous broken chain of title in the country."--Lynn Szymoniak.

"The millions facing foreclosure [are] not facing foreclosure just because of individual actions."--Malcolm Chu

This was a Netroots Nation panel held "in a room with no streaming, and President Obama is holding a press conference to conflict with it." Marci Wheeler's rush transcript (liveblog) shows possibly the best overview of the homeownership disaster I've seen.

David Dayen kicked off the panel with a catalog of types of housing fraud:

1. Origination fraud (liar loans, discriminatory, paper fraud) 
2. Appraisal fraud. Then 
3. Securitization fraud, failure to convey the mortgages to the trust properly. 
4. Investor fraud, putting bad mortgages into packages willingly, and not telling the investors. 
5. MERS, which is a giant tax avoidance scheme. 
6. Servicer fraud—fee pyramiding. HUD did test of 35 loans from, of the 35 actual price of mortgage could not be verified on 34. 
7. HAMP.  
8. Force place insurance fraud. Servicer buys at a huge price and make mortgage holder pay for it. 
9. Foreclosure mill. 
10. Robosigning. 
11. Breaking and entering.

Panel information: Moderator, David Dayen. Panelists: former TARP Inspector General Neil Barofsky, community organizer Malcolm Chu, and whistleblower Lynn Szymoniak. Read Marci Wheeler's liveblog post at Emptywheel. Video is promised for later today.

Wisconsin and the Media

We're seeing a lot of arguments on how this wasn't "really" a defeat for unions and that the voters just don't like recalls. In 2003 when Grey Davis was recalled in California, voters liked recalls fine. Voters were told not to like recalls, over and over. They were told to be jealous of people with decent salaries and pensions, instead of trying to get them for themselves.

I think the bottom line here is that it’s nearly impossible to win against a well-run campaign propagated through a media dominated by the propagandists. All the money spent in the state was able to dominate the media.

Now, this is not news. It is how the authoritarian regimes of the 20th century operated. I think that part of having a free press is having a press that is not monopolized by a single political viewpoint. The people who wrote the post-World-War-II anti-press concentration laws knew understood this very well, having just lived through wars enabled by controlled mass-media. So, so long as there are centralized mass media, I think freedom demands regulation of media concentration.

Bring back the Fairness Doctrine! Put Noam Chomsky on Fox!

The Failure of the Left in the United States

The unions, unnoticed, have been one of the pillars of our democracy. They fund campaigns and all kinds of activism. But now, it seems, the radical right has found a way to defeat unions at the state level.

Yeah, we lost Wisconsin. If that progressive stronghold could not stand, I think only the wealthiest, most urban states will. And Oregon, for some odd reason.

For some years to come, it seems the US right wing has a winning formula. What this means...

1. More wars. The rich and powerful can't manage to pay the rest of us, but there are always enough of them who want to pay for the next war, and send some of us off to die in it.
2. Authoritarianism at home. The continued expansion of the surveillance state and the use of militarized policing within US borders.
3. Uncontrolled carbon emissions and ecological destruction, for at least another decade.
4. The continued abrogation of ancient rights of property and person.
5. A continued fall in wages.
6. A continuation of boom and bust economics that will impoverish all but some of the wealthiest.
7. The reduction, if not outright elimination, of Social Security. The privatization of Medicare. Severe cuts in Medicaid. People's grandmothers will die, along with grandfathers and children, as well as numerous disabled people. Younger people will have the hard choice of taking in and caring for disabled elderly relatives or seeing them left to charity care.

Personally, it is likely to make it hard for me to get health care. I thank you from the bottom of my heart, oh conservatives, from all its diseased arteries.

And how will it end? I expect to be an old man before I see any improvement, if it comes at all in my life. I do anticipate change as the younger generation grows to middle age and comes into power. Look to the elections of 2020, I think. But, even so, it's going to be a hard ride. Meantime, look to the alternative economy and the new craft economy. Make friends and support each other.

The wildcard, as it has been for years now, is climate change and ecological destruction.

On the defeat of labor in Wisconsin

[I'm cross-posting this in many places]

With the resounding defeat of labor in Wisconsin, we are probably going to see a return to 1880s levels of anti-labor violence. So one of the questions becomes: will a President call out the National Guard, or use the standing military, to put down strikes?

It’s hard for me to imagine that Romney would not. Obama?

Turning to the narrower effort, just what is Wisconsin going to become? Is the University going to survive? What happens when we see people fired in job lots at a whim? It is hard for me to see how violence can be avoided.

Food!

BTW, please stop calling it "right-to-work."  Call it "scab."

Croak of the Day: Jeff Sharlet

(Well, yesterday, anyway.)

"@JeffSharlet Masked men in all black, wearing strange armor, refuse to ID selves, carrying sticks cld be weapons. Turns out cops have a black bloc, too."

(After FireDogLake, link.)

Centrist Fiscal Responsibility

The center-right coalition which had governed Greece since 1975 broke apart in the last election. The conservative "socialist" (though perhaps it is best described as SINO--socialist in name only) PASOK party lost, in favor of more leftist parties, and the fascist Golden Dawn. The largest plurality in the election went, unsurprisingly, to the more conservative centrist New Democracy party, with the second largest to a left to far-left coalition, and the third to the fascists.

The loss of PASOK, and the realization that in Greece the "centrist" coalition had broken up, led me to reflecting on how similar Greek politics was to US. In the USA, it is the Democrats, the slightly further left element of the centrist coalition, who have suffered the most in the breaking of that coalition. In Greece, PASOK. In the USA, the Democrats have responded by becoming more conservative; in parliamentary Greece it is possible that PASOK will fail entirely, or at least become a marginal party.

I am struck by how the economic history of Greece under the centrists parallels the economic history of the USA under the centrists. The corruption was worse in Greece, with widespread tax evasion and over-borrowing in prosperous times. But in the USA, the financialists stole our health care and banking systems and the peacetime militarism has been huge, so it is not like the USA was corruption-free.

Centrists consistently claim to be fiscally responsible, and they lie. With their military over-spending, their over-borrowing to cover over-spending (as under Reagan and Bush II as well as in the last decade of Greek history), with their crony capitalism, with their tax-base decreasing austerity policies, they are anything but fiscally responsible. Their claims of fiscal responsibility, in entire, are delusions which much of society accepts, apparently because of the widespread belief that pain is more to be trusted than pleasure.

If you went to a doctor, came away feeling worse, and kept feeling worse, while the doctor kept claiming you were getting better, would you go back? Yet that is what centrists and austerians ask us to do. To Orwell's three slogans of the Party: "War is peace," "Freedom is slavery," "Ignorance is strength," I think I would add two more: "Poverty is wealth" and "Sickness is health."  After decades of centrist policies, and the abysmal failure of those policies, I don't see any reasons to believe at all.

A focus on debt, and debt alone, in government budgeting is fiscal irresponsibility.

Conservatism is as much in love with violence and pain as nihilist anarchism, and conservatism is far more popular.

I believe that health is health, and wealth is wealth. Much simpler that way.

On the failure of welfare reform

Dr. Jared Bernstein:

Excellent reporting in today’s NYT on whether welfare reform worked as well as almost everyone says it did. The conclusion, as we’ve stressed in lots of recent work at CBPP, is that it is at best a fair-weather ship: it only appears to work when there’s lots of job opportunities for the low-income, single parents.

Croak, posted in comments on that blog. Posted here as a record, and in case Dr. Bernstein doesn't pass it through moderation.

This was made possible by the conservative Democrats; it was proposed by Bill Clinton. The same faction to which Obama belongs, which controls the Democratic Party, and which, in coalition with the Wall Street Republicans, now governs the USA and will probably do so for at least the rest of the decade – that is, if the Tea Party Republicans don’t simply take over.

“Screaming in language that no one understands / Of the rights that we grabbed with our own bleeding hands / When we wiped out the bosses / And stormed through the wall / Of the prison they told us would outlast us all // Marat we’re poor / And the poor stay poor / Marat don’t make us wait any more. / We want our rights and we don’t care how / We want a revolution – now.”--Peter Weiss, Marat/Sade.

Croak of the Day

Is this really my first post of 2012? So it is. Well, I've been busy. And it's just a "what he said."

Anyhow, today's Croak of the Day goes to Robert Reich.

The Republican right thinks Paul’s views on the economy are responsible for this fire among the young. I just now squared off with Larry Kudlow and Steve Moore on Larry’s CNBC program, both of whom are convinced young people are attracted by Paul’s strict adherence to the views of Austrian economist Ludwig von Mises, and Paul’s desire to move America back to the gold standard.

Wrong. The young are flocking to Ron Paul because he wants to slice military spending, bring our troops home, stop government spying on American citizens for the purpose of homeland security, and legalize pot.--link