Wednesday, January 31, 2018

The Coming Trump Recession

In those moments when I am not lamenting the bigotry that shapes so much of our political debate, especially over immigration, I lament the utterly unwarranted credit that Donald Trump takes for the current state of the American economy, which grew steadily under the stewardship of Barack Obama, and has continued to do so during Trump's first year in the White House.  The same economy that Trump despised as a candidate is now a source of pride to him, because he can now attempt to manipulate the public mood from the Oval Office instead of the campaign trail.  But the reality is simply that this has been Obama's economy, up until the so-called "tax-reform" bill that Republicans drafted and approved for Trump's signature last month.

And now?  Well, watch out.  Because the Obama recovery and expansion is about to be supplanted by the Trump Recession (or the Trump much-worse-than-that).

To begin with, the tax bill is paid for 100% with your grandchildren's money, in the form of T-bills.  This, combined with the ending of the Federal Reserve's quantitative easing policy of expanding the money supply, will ensure a spike in interest rates--a spike that, in fact, has already begun to show signs of starting.  The reason for this is very simple:  interest is the price tag for money when, in the form of borrowing, money is treated as a commodity.  Consequently, as the supply of money shrinks, borrowing becomes more and more expensive for individuals and businesses who want to borrow, which in America is just another way of saying everyone.

And it becomes even more expensive when people start to do one of two things--dipping into savings, or liquidating investments--that further reduces the available amount of money in the marketplace.  Surely, both of these things can't be happening at once.  Oh, wait.  For that matter, wait yet again.  Looks like people aren't waiting for their $30-dollars-a-week "tax bonanza" to "trickle down" to them.  Instead, they know a stock bubble when they see one, and they want their money now.

They also know that the tax bill, currently being marketed as middle-class tax relief, is anything but.  Not only because their share of it is so pathetically small, but because they see the money going from the employers to the shareholders, as well as CEOs.  It will then be offshored to overseas tax shelters, far, far away from the economy it was supposed to benefit.

What happens when, because of the cost of borrowing money, a business can not expand, or can only do so at great additional operating expense?  It may choose to slowly decline and go out of business, or it may simply try to pass along the additional cost to the consumer.  Either way, jobs will be lost, and purchasing power will shrink, which will increase the spiral of job losses.

And, before you know it, Donald Trump will have lived up to his resume.  He'll have done for America what he did for Atlantic City, going bankrupt four times in the process.  Remember that word:  bankrupt.  There's a decent chance that it will describe many of you, sooner than you think.

No one should misinterpret any of the foregoing as a defense of the tax code status quo.  There are many, many arguments for changing the tax code.  We need to bring home money that has been stashed away abroad, and encourage its investment in an economy that relies on renewable resources, trains Americans for 21st-century jobs, and ends the hardships of those who have been left behind in the globalization of the world's trade.  We need to discourage industries that contribute to extreme patterns of weather that use up productive resources faster than we can replace them.  We need to rebuild communities that have been devastated by the predatory business practices that began with Ronald Reagan's Presidency.  We need to find ways to rebuild the infrastructure that once made us the envy of the world, and that now looks pathetic and dangerous compared to much of what is now being accomplished in so-called "third world" countries.

All of this can and should be accomplished by sensible tax reform, one that focuses on advancing the public interest and stops pretending that there are no differences between public and private interests. That kind of tax reform can and should take place through a legislative process that involves representatives of the interests of all Americans, not one in which the investing class instructs the Representatives and Senators it has bought to conduct a midnight raid on the pantry of our public fisc. That kind of tax reform can and would take place if we had a President who believed in paying contractors whether they were in a position to blackmail him or not (I'm thinking about you right now, Stormy Daniels, with an acknowledgment to Stephen Colbert).

Instead, we have a tax bill that is guaranteed to take us into the coming Trump Recession--or worse.  There is only one sensible thing that you and I can do about it--vote Democratic, in 2018, 2020, and beyond.  Stop waiting for purity; the other side certainly isn't.  This isn't about purity any longer.  It's about preventing the economic suicide of the United States, and everyone in it.

I hope there are enough of you, starting this fall, to prevent it.  I'm counting on it.

The "Undocumented" You Will Always Have With You

It's a massive understatement to say that immigration is the most controversial and divisive political issue of our time.  It's a mistake, however, to say that the modern era is the first time the country has been bitterly divided by this issue, or to think that it can be laid to rest once and for all with some sort of legislative "silver bullet" that has not been previously considered, debated, and/or voted upon.  As this article from the New York Times shows, much of the previous century was focused on heated debates over various aspects of immigration, and various attempts to resolve those debates by enacting new laws and bureaucracies.  The significant thing about all of these attempts is that all of them were attempts to "definitively" resolve the "problem" of "illegal immigration."  And all of them failed.

Why?  Has it been simply a question of poorly-drafted legislation, or poorly-thought-our responses to the issue?  Has it been an unwillingness to spend enough tax dollars?  Has it been the willingness of the American public to look the proverbial "other way" when it comes to utilizing immigrants for a variety of purposes, in spite of the knowledge that, in at least some instances, doing so meant breaking the law?

No to all of the above.

I think that it might surprise a number of today's conservatives, in particular those who advocate reducing the annual number of visas currently available as well as adopting some sort of "merit-based" system of attracting people from abroad, that, in trying to "regulate and restrict" what has been recognized by the Supreme Court as one of the most fundamental of rights--the right to travel
--they have essentially been engaged in a form of centralized economic planning. 

Conservatives, at least in theory, are supposed to abhor this.  They claim to be defined by the fealty to the concept that the best, most productive, most innovative economy is one that has the fewest possible restrictions.  Logically, that should include not only the free, unfettered movement of money, but also the free, unfettered movement of people who make it, invest it, and spend it.  In theory, therefore, if a conservative vision of immigration were to be consistent with its vision more generally of how political economy works, it would favor open immigration with no restrictions except for individuals with a history of criminal activity and/or terrorism. 

Such a system would, by definition, be a less expensive system, one that relies heavily on records that already exist to serve other public purposes, such as law enforcement.  To argue against my self-interest (and that of my wife/law partner), such a system would also require fewer attorneys, since it would be far simpler to apply for and obtain a visa through an embassy.  But, above all, and again taking an orthodox conservative point of view, such a system would be truer to Adam Smith by letting the marketplace sort out the question of who should (and shouldn't) come to the U.S..  And, by being less bureaucratic and less restrictive, there would be few, if any, official "mistakes" in the form of undocumented individuals.

This, in fact, is precisely the point that the Times article is making.  Put simply, it states that all of our efforts to legally restrict the presence of immigrants within our borders does nothing except to create a class of people who have no authorized identity, and could arguably said to have no authorized existence.  This in turn simply makes it easier for demagoguery to play a prominent role in the immigration debate, by using demeaning and even inhumane rhetoric to describe men and women who are effectively in the position of not having a country.  The class of immigrants who have been the object of efforts to enact the so-called DREAM Act, or "Dreamers," individuals brought here as children by their undocumented parents, are a currently-prominent example of such people.

And yet, despite the failure of restrictions to solve the "problem" that the restrictions have largely created in the first place, conservatives go on advocating their further and greater use.  Even more amazingly, they attempt to fortify their objections with economic rationales:  immigrants take jobs away from citizens and consume resources needed for those same citizens, despite study after study showing that neither rationale is rational, or even true.

When you pair these facts with America's long and troubled history in the area of race, along with the increasingly racial tinge of the anti-immigration rhetoric, it becomes impossible to see today's conservative restrictionists as being motivated by anything except racial animosity, and the hypocrisy that characterizes that animosity.  Consider:  the U.S. is the by-product of white Europeans displacing dark-skinned Native Americans, and then importing dark-skinned Africans to perform all of the tasks needed for living but despised by the Europeans, who did not so much believe in the right to travel as they did the right to conquer and dominate.  It is that belief that lives on today in the vile racial language of our current President, and many of his supporters.

That racial animosity is precisely why any so-called "merit-based" system is doomed to be enforced in an inherently corrupt way.  Those who are in charge of enforcing it will be quick to find fault with applicants whose main offense will be a lack of paleness.  That animosity is what will undoubtedly cost this nation the gift of people who are not obvious gems, but who nevertheless prove to be diamonds in the rough.  Harry Pangemanan is one such person, as are many of the people who currently can obtain green cards through the so-called "diversity lottery."

And, in fact, that animosity is precisely why the current debate, from the Republican perspective, needs to continue without a resolution, so that the party's voter base will continue to be "fired up" and vote, time after time, against its own interests in promoting a welcoming society and not one that treats itself as a prison.  In consequence, this is why I believe this story to be painfully true.

So long as we fail to account for the need of every human being to move about in search of a better life, so long as we fail to allow the whole human race (criminals and terrorists excepted) to sort out their personal and economic interests, so long as our bitterly racist souls allow us to attempt to formulate immigration policy that is at odds with our economic realities, so long will we be not only a nation of immigrants, but also a nation of undocumented immigrants.  We will be surrounded by people who are people in the eyes of everyone but the law.

Whose interests does this serve?  Only the interests of bigots.  Those are the people we should be the most afraid of.  In their short-sighted inhumanity, they're the most un-American of all of us.

Sunday, January 28, 2018

What All Of Us, And Not Just Millenials, Can Learn From Talia Jane

Before you do anything else, stop reading this blog.  And read this, from end to end.

Done that?  Good.  Now, let's take a few minutes to talk, via way of cyberspace, and see what all of us can take away from it.

First, it goes without saying that Talia Jane is a very brave young woman.  Granted, it may be the kind of bravery that emerges only out of desperation.  But, cards on the table, that's how most bravery emerges.  When it has to.  Not when we want to summon it up for other's amusement, like a parlor trick or a game of Charades.

In any case, she put her livelihood (such as it was) on the line for her sake and the sake of her employees, many of whom were at the ends of their financial and emotional ropes, and publicly called her employer's CEO out for paying wages that were grossly disproportionate both to the quantity of work expected and to the cost of living in the area where the work was being performed.  In this case, San Francisco, which has one of the highest costs of living anywhere in the nation.

She did this, and paid the price.  Both short-term, and long-term.  But she made a difference for her co-workers.  One that may never have been made, had it not been for her late-night crie de coeur to Yelp!'s CEO.  And, in the process, she discovered that she had the ability to survive a disaster that would have completely crushed many people.

Here's the point I really want to make about Talia Jane.

She should be an inspiration to us.  To all of us.  Not just millennials.  Not just people living in San Francisco, or blue states.  Or red states.  Not just customer-service workers.  Not just Silicon Valley companies.  All of us.  Whether young, old, black, brown, red, yellow, white, male, female, transgendered, cisgendered, gay, straight, bi (yes, I believe it's possible), rich, poor, or any of the other demographic identities by which we too often limit our potential, or allow others to limit it.

Because none of the progress that has been made in the history of the human race has ever been made without someone sticking out his or her neck.  And taking a chance on it being cut off.

And we need a lot of very willing necks at this point in our history.

We have a national government whose three branches have been almost completely corrupted by a political party whose members are united only by their lust for power.  We have the vast majority of our state (but, thankfully, not yet our local) governments infested by the exact same corruption.  We have a national economy that is, in fact, merely a subdivision of an international economy that has turned its capitalistic backs on the needs of the people whose work and consumption makes it possible in the first place.  Our tax dollars go largely not to promote the general welfare, but the private profit of businesses that not only don't need it, but who have proved time and again that they do not deserve it.  Our lives, our fortunes, and our sacred honor no longer feel as if they are in the service of our interests, or of a cause greater than any of us, such as the freedom and dignity of the human race.  Our expectations are burdened by dread, instead of lifted by hope.

If you're hoping that the Romans named Status Quo are going to magically wake up one day, realize the errors of their ways, and suddenly give us the great big beautiful Tomorrow that all of us in fact deserve, you can put your lantern down right now, Diogenes.  They expect everything going on now to go on forever, and they are just fine with that.

But it doesn't have to go on forever.  And it shouldn't.

And it won't, if you make your number one resolution of the New Year to be a willingness to stick your neck out like Talia did.  Speak up for those who are being squashed by the dead weight of those whose power exist only so long as the people who really create wealth--the workers--tolerate its existence.  And, in the process, discover that you actually have more power, and otherwise more to offer others, than you might have ever imagined before.

Go ahead.  Do it for yourselves.  Do it for your co-workers, your friends, your relatives, your neighbors, everyone.  We're all in this crazy thing called Life together.  And together, we can make it worth living for all of us.  Or we can pretend we deserve nothing better than what we have.

Talia Jane decided to stop pretending.  She discovered that the risk was worth it.  Are you ready to join her in taking that step off the ledge that, in fact, takes your life and those of others to a higher level?

I hope so.  I pray so.  I'm ready and willing.  I'll let you know what happens.

A Word With Which To Start Thinking About 2018: Kakistocracy

There's a line from Jason Miller's play, "That Championship Season" that, for some reason, has always stuck with me.  The line has one of the main characters describe someone as being "too stupid to be corrupt."  Perhaps it's simply because it's a funny line.  Perhaps because there's an important truth wrapped up in the humor:   deceit, in order to accomplish its aims, has to have a degree of talent behind it, often talent that could be put to a better purpose.  Whatever the reason, it turns out I'm not the only admirer of this line, because I have seen it--or variations of it--in a variety of contexts, especially political ones. 

Perhaps not surprisingly, I have seen it used with reference to Donald Trump, and his conduct in the Oval Office over the past year.  In some cases, the intention has been to reassure the American people that, contrary to their worst fears, as well as to appearances, things aren't as bad as they may seem.  Trump is, ultimately, too stupid as well as too lazy to be a true totalitarian.  He'd much rather spend time on a golf course, especially one of his own golf courses, than conquering a nation or torturing his opponents.  Or even, for that matter, how to ask those around him how he could go about doing those things.

Unfortunately, anyone who allows themselves the luxury of being comforted by this line of reason is living in something far worse than a fool's paradise.  Something close to the tenth circle of Dante's Inferno--if not in our lifetimes, then in those of our children and grandchilden.

That something far worse can be, and has been by The Atlantic, summed up in a single word:  kakistocracy.  As defined by the linked article, kakistocracy amounts to government by the corrupt, placed into power by a corrupt leader backed by a corrupt constituency.  Trump, obviously, is the corrupt leader in the case of our current misery.  As for the corrupt constituency of that misery, the article views it as a tandem:  Trump voters, blinded by Trump's real estate and TV credentials.  Their unthinking votes, along with a Republican Party establishment that cared only about regaining the White House, ultimately outweighed the will of 54% of the American voting public.

But, once Trump was in place in the Oval Office, the membership of the kakistocracy grew exponentially, to include his staff, the Republican Congress elected along with him, and the leadership of the agencies that operate under presidential authority.  Many of the individuals who make up each of these cohorts are far from idiots--and, like the GOP establishment, they are motivated only by a desire for power, for themselves and the private interests they represent.

And it's not just The Atlantic describing this in detail, as well as the effects this is having on our domestic and foreign interests.  There's also this by Michelle Goldberg, writing in the New York Times, in which she also notes that Trump's stupidity, conceded by everyone who spends any amount of time working with him, is not always contained successfully, as in the case of Trump's firing of James Comey as F.B.I. director.  Trump is aware that he is being managed and, rather than submit to the process, he is working actively to surmount it.  As Goldberg herself points out, "Now imagine Trump taking the same approach toward ordering the bombing of North Korea."  One's imagination does not have to stretch very far to be completely horrified by the implications of that sentence.

Trump is indeed an idiot, by the standards of our very best Presidents.  He has no curiosity, no belief in anyone's expertise except his own (such as that is), no willingness to consider the lessons of history, no interest in trusting the judgment even of the people he's selected to staff his Administration, and, perhaps worst of all, no ability to even consider the possibility of being wrong, or to accept responsibility when he is in fact wrong.

But none of this is stopping Trump from effectively being corrupt.  Not only has he been enabled by the political apparatus of which he is now a part, but he is also finding ways to circumvent that apparatus when he needs to eliminate a perceived or actual threat.  That need is the only thing that seems to motivate him to pay attention to what's going on around him outside of the disco of his mind.  And what's best for Donald Trump is not always what's best for the country.  Which is why we should have no confidence in the people who think they are "containing" him.

Especially when the damage that has already been done by the Trump White House, the GOP Congress, and the GOP itself (as well as its media/Internet echo chamber) has already percolated down through some of the biggest, most important Federal agencies, like the Social Security Administration, jeopardizing the financial interests of our country's most vulnerable citizens.

Or down to the level of State government, where, in the case of North Carolina, democracy has almost disappeared.

Or down to the level of individuals willing to speak out against Republican corruption, who suddenly find themselves the victims of cowards willing to take their political differences to the level of violence.

Or down to the level at which the truth itself is in jeopardy, through Republican efforts to confuse the public about who is and is not breaking the law.  (Hint:  nowadays, in the majority of cases, it's the folks pointing the fingers, not the people on the other end of the pointing.)

I'm afraid there is no such thing, after all, as being too stupid to be corrupt.  If corruption plus stupidity puts stupidity into power, and then manipulates the stupidity for its own benefit, the rest of us are left to wonder whether an analysis of stupidity vs. corruption is an attempt to find a distinction where, as measured by the results, there is no difference.  They are both the enemies of truth, justice and the American way.  And, if we are ever to get out of the kakistocracy into which we have fallen, we will need to find ways to simultaneously fight both

And give in to neither.

Kakistocracy:  the marriage of the stupid and the corrupt.  Remember that word.  Remember what it means.  And, on all fronts, fight it like hell.