A Mercantilist World?

(An earlier version of this was posted as a Firedoglake diary, where so far it has not been noticed. This is my copy here, for a record and perhaps discussion. Minor changes on day of publication.)

Over at Project Syndicate Brad Delong writes:

But there are two dangers in America’s forthcoming debate. The first concerns the term likely to be used to frame the debate: competitiveness. “Productivity” would be much better. “Competitiveness” carries the implication of a zero-sum game, in which America can win only if its trading partners lose.

[...]

The second danger is that “competitiveness” implies that what is good for companies located in America – good, that is, for their investors, executives, and financiers – is good for America as a whole. Back when President Dwight D. Eisenhower’s cabinet nominee Charlie Wilson claimed that what was “good for America was good for General Motors – and vice versa,” GM included not just shareholders, executives, and financiers, but also suppliers and members of the United Auto Workers union. By contrast, General Electric CEO Jeffrey Immelt, recently appointed by Obama to lead the President’s Council on Jobs and Competitiveness, runs a company that has long since narrowed to executives, investors, and financiers.

In other words, a focus on “competitiveness” could lead to a neo-mercantilist class society. It is hard to imagine a world in which all major economic powers are neo-mercantilist, but that seems to be a real possibility. China and Germany already pursue mercantilism through their currency polices, and if the USA does also, mercantilism is that much closer to becoming the global economic order. A mercantilist economic order is not likely to be an economic order in which anyone except the very wealthy would be happy: part of the push to increase trade profits would involve a push to lower labor prices.

It would also be an economic order where conflict would be endemic. Between the great mercantile powers, trade conflict. Within the great mercantile powers, class conflict. Between the successful mercantilist powers and their less-successful trading partners, international conflict. There is a cost, paid in security measures and hatred, to maintaining a class society: to being the filthy rich minority in impoverished world. Nor can I see how such a world could be environmentally sustainable: there would always be the temptation to gain a competitive edge by damaging the environment by extensively using fossil-fuel energy, overfishing, polluting. A neo-mercantilist world would institutionalize the tragedy of the commons.

This could be the way the world ends.

Short Croak: The Red Menace

The United States is going through a new red scare.  Only now we are all reds.

This produces very odd rhetoric.

SOTUMeh

To this old bird, this sounds like one of those official speeches one hears from a defeated leader. Rah-rah-rah. Only…there’s nothing to rah about.

Obama has at least found a way to defend infrastructure spending. We seem to have come full circle: much of the expansion of the Federal government in the 1950s and 1960s was justified by nationalism. The Interstate Highway System started as a “defense” project, and much of the expansion in education and research similarly. So now we have Obama defending these things as appropriate for “competitiveness.” At the same time, though, he plans to cap a great deal of spending. The states are cash-strapped, and Obama has committed to a course where the Federal government will not help them. So just where is the funding for all this education and research going to come from?

SOTU croaks I approve of:

Digby:

But I think it sounded oddly discordant, as if the economic crisis is a best forgotten nightmare even though we still have 9.5% official unemployment and a housing sector in deep distress. It's not as if GDP is growing at some jaw dropping pace. So, to my ears it was oddly out of touch. “Winning the future” would be a lot more inspiring if we were all sure we were going to survive the present.

KrugMeh:

Overall, however, I have no idea what the vision here was. We care about the future! But we don’t want to spend!

 Mark Thoma (Economists View):

[...] How do we help those who need a job right now? Solving the more immediate job problem needs to be first and foremost on our national agenda, but this was not addressed in the speech. [...] it wasn't lack of innovation or lack of competitiveness that got us into this mess, it was an out of control financial sector. [...] We need to get our deficit under control, but not before the economy is ready for it. [...] there needed to be more emphasis on the fact that eliminating tax cuts for the wealthy and spending cuts will not solve our budget problem by themselves. [...] a spending freeze while population is growing amounts to a cut in per capita spending. While this sounds courageous, it's actually the easy way out since it avoids tough choices on which programs to cut and which programs to preserve.

Hominds.

What Eskow Said, on Martin Luther King and Economic Justice

Richard Eskow: 

This weekend Dr. King's name will be spoken by politicians and business leaders who would probably despise what he would have had to say about 21st Century America. They'll try to appropriate his name and memory to ensure their own well-being. They hope to domesticate his moral challenge in order to protect their own ambition.

Fortunately, Martin Luther King left his words behind. In his honor, here are ten quotes from Dr. King, illustrated with images from today's events to show their continued meaning. If they don't manage to comfort the afflicted on this national holiday - and at least unsettle the comfortable - they're followed by a slide show with even more quotes.

Wow. Read the rest.

Talking moral sense about hate rhetoric

"Slacktivist" on Conor Friedersdorf on the hypocrisy of the haters:

Violent language and violent rhetoric can be a problem, but I do not think it is the main problem afflicting our diseased political discourse. The main problem, rather, is disingenuous rhetoric that coolly and calmly demands a violent response from anyone who believes it or takes it seriously. This talk may have nothing to do with guns or crosshairs or "reloading," but it is the logic of life and death. That logic doesn't just raise the possibility that some unhinged person on the fringes might take it wrong. It suggests and requires violent action as an unavoidable moral obligation.

 A point worth keeping in mind. Slacktivist goes on to point out that the haters don't actually believe: if they did they would be out fighting their revolution.

Changes after the shooting of Giffords

I think the most likely short-term outcome of this is a crackdown: more investigations, more policing, more censorship. Possibly deployment of porn scanners outside of airports. While Sheriff Dupnik blamed his local people, who he knows very well, FBI director Mueller has blamed the internet—us. It is difficult for me to see anything that is likely to lead to a reduction of hate speech or the pathological obsession with violence our right wing displays. The Tea Party leadership shows no shame; I do not expect Murdoch to reign in Fox News or the Kochs to reign in the radical-right groups they fund.

 Nothing to see here, move along.

In the long term, it's hard to say. When weak people have no arguments left, they resort to violence. Jared Laughner seems to be a psychologically disabled man. He seems to have targeted Rep. Giffords because she was the nearest authority figure in reach and, probably, because of all the hate speech he had already heard directed at her. He was able to buy a semi-automatic pistol with an extended clip because we do not take seriously the need for checks on the mental health of firearms purchasers. In the long term, it is likely that the violence will collapse the credibility of the radical right, but it could be decades before that long term arrives.

Well-fed corvids.

Meantime, Politics as Usual: Simon Johnson on the Daley Appointment

It's too early to declare a croak of the day, but I think this might be a pretty good candidate.

If the country’s most distinguished nuclear scientists told you, clearly and very publicly, that they now realize a leading reactor design is very dangerous, would you and your politicians stop to listen?  Yet our political leadership brush aside concerns about the way big banks operate.  Why?

Read the whole damn thing.