The Equanimist

Invest in US

Posted in Economics, Economy, Political Economy, Politics, Public Policy, Socioeconomy by equanimist on August 16, 2010

I

Where do stewards who hoard currency (incentivization to put people to productive work) think that average people are going to get money?

Where do average people get money? Can they print it?

How does flow and use of money (economic engine) work? Can socioeconomy (presently) function without some kind of currency actively cycling through it?

The single most pressing issue facing the US remains a lack of US jobs—as opposed to unemployment, which concept is clouded by unemployment insurance: jobless aren’t exactly unemployed for so long as they receive money from the government to pay bills but in a sort of limbo between employment and unemployment.

While fundamental causes of hoarded currency may include utter lack of perception/understanding of socioeconomic principles (including civic responsibility and patriotism as same apply to the wider world) combined with inability among people vying for acceptance (and conditioned to think one way or another) to “put two and two together and get four” on their own when they are being told it is ten, the proximal cause of unemployment is hoarded (misused) currency. This can and must be quickly addressed.

II

Currency (so-called “paper money” measured in dollars and cents) is not commodity but tool. That US people were able to produce with credit (pseudo-currency) more than they could afford with circulating (real) currency is testament to the fact that there is not enough real currency circulating through the economy.

The US did not furnish too many jobs. US people did not live beyond their means, but credit to supplement available incentivization provides evidence of irrational distribution of paper money, which is disproportionately concentrated in the hands of a few who do not use it.

Lack of current in currency can be the result of a confluence of factors including too-high pay packages at the top combined with too-low investment by top earners and businesses, too-low taxes on top earners and wealthy businesses, too-low wages at the bottom, and too-high prices for goods and services (in this case, the direct result of pull from the top as evidenced by increasingly unequal wages).

That the modern steward class would sooner allow US infrastructure to decay than make currency available is testament to a radical change in attitude of US stewardship that took place over several decades.

III

Why does it bother currency-hoarders that US masses buy the very iPods and PS3s and HD TVs that keep them entertained (and otherwise oblivious to a changing power structure)? Surely it must bother them because they are not doling out the money with which to make future purchases, or, they are but they are not including enough to meet other expenses.

Why does it bother them that average US people are well educated in order to be more productive, better-quality servants? Surely it must bother them because they and their representatives have cut and continue to cut education spending. Isn’t high pay supposed to attract the best and the brightest? Aren’t small class sizes supposed to lead to better-educated students? Hasn’t the US system suffered by most metrics?

Why does it bother these hoarders that average people can afford their own homes? Surely, average people must live some place.

Past US stewards (i.e., our progenitors) might have been thrilled by the extraordinary accomplishments that we made as a society. Yet, their children revolted against the socioeconomy that made these possible. The “greatest generation”, spoiled (perhaps) by two terrible wars, bred a generation (the current steward class) that is preponderantly fearful, callous and avaricious beyond reason. These compulsive people are committed to a “zero-sum-game”, “tough-love” vision of life incompatible with civil society because it undermines systems that civilize.

Modern US stewards take indiscriminately from people whom they see as adversaries (i.e., everybody else) in order to hoard, while they would undermine with an army of lawyers and lobbyists the institutions that make possible US socioeconomy and gamble that US middle class will accept the change passively.

Worse, modern US stewards fail to understand the risk—that we are what we are—not what we would wish to be. If US stewards act like Mexican, Indian or Chinese (or pre-war US) stewards then, all else being equal, they’ll recreate Mexico, India or China (or pre-war America). Consider, for example, Mexico is so fantastic that its citizens streamed across the US-Mexican border at great personal risk to be illegal immigrants and all that that entails.

There is nothing in the last few hundred years of western history that suggests that average western people will suffer degradation indefinitely while their stewards enjoy ever-increasing wealth. The result of wealth consolidation and deficient current then, instead of safety, is likely to be ruin (preceded only by volatility and risk).

IV

Consolidated wealth must be wound down to a sustainable level and invested at home.

It is no longer enough to stimulate US demand. US people must spend more on US goods and services or jobs won’t come back. To that end, average US people need more real money to spend and strong incentives to spend it domestically. Further, it will not be enough to furnish more credit for the purpose: this crisis is predicated upon credit in place of currency.

The Credit Gamble [which seems something like, “If we (a minority of stewards) make credit available and show what it can do then the broader steward class (the same that has been consolidating money) will be forced to pay when the rent comes due because average people will be unable to do so”], this gamble did not pay off.

Modern US “stewards” do not tend to see themselves as such but see themselves as adversaries of average people and popular government: aristocrats. These aristocrats see only how fat their wallets get, and, thinking that they are successful just as long at they make more money to hoard, they continue to siphon the lifeblood (fiat currency) off our socioeconomic system.

Doubling down would be foolish.

V

To suggest or, worse, believe that people who have and businesses that have consolidated wealth will spend (in an “uncertain environment”) more than they make (that is, that they will suddenly spend down their savings to reinvigorate the US economy) because their taxes are lowered is absurd and would not be worthy of consideration except that it is suggested by those who view success in terms of hoarded currency and their surrogates.

If the US did not attract business sufficient to employ US people and jobs were vanishing for that reason then tax cuts could be used to attract business and restore jobs. But business attraction is not now relevant to US job creation.

There are plenty of businesses headquartered and/or doing business in the US. Despite tax cuts, it will remain cheaper to produce goods and services in China and India and Mexico. Believing the bottom line the single most important function of business, US businesses will continue to outsource absent some incentive to produce goods and services in the US. The “savings” that outsourcing yields will continue to go to a small few who have steadily awarded themselves higher pay and severance packages at the expense of “working” people absent some force acting against them. And, jobs will not come back as the result of tax cuts.

Instead, taxes should be raised substantially on top earners. Further, tax law should be modified to tax extraordinary wealth that is not invested in projects that put people to work. Using this money to create US jobs will begin to make up the slack in currency circulation without devaluing the dollar.

Obviously, it is difficult for elected US officials, increasingly pageant winners and right-hand men—not stewards per se, to distribute money to the middle class, which will spend it wisely (just so long as they spend it domestically). But, the US government must also pressure wealthy businesses to expand domestically and pay more in wages (in a deflationary environment) and simultaneously take money from same wealthy businesses (i.e., stewards who own/manage same) to distribute to US middle class.

[One might argue that businesspeople borrowed from future growth to buoy their own incomes: by beggaring their countryman and leaving same laden with debt, while packing away the higher yield of outsourcing—not putting it to use abroad to create foreign middle classes or distributing it at home to sustain their own way of life but always “leaving it to others” to do these things, these businesspeople ensured that the US would lose jobs, spend down its capital, accumulate debt and ultimately collapse like a house of cards when the cheap money stopped flowing.]

VI

High taxes, however, are not sufficient solution.

The wake of a staggering Chinese trade surplus and Buy Chinese incentives (borrowed, perhaps, from decades-long success of “Buy American” programs) provide another opportunity to institute an Invest in US program. Unfortunately, it will be a harder sell than it was a few years ago when inferior products seemed a plague, but it should look the same:

1.) All containers entering US ports should be thoroughly inspected. Inspection costs should be paid by the importers themselves—not US middle class.

It must be within a country’s purview to verify that contents of shipping containers are as listed and meet well-defined standards; and, if one genuinely wants to stop crimes including everything from trafficking in guns and human slaves to terrorism, it is a wise policy.

Moreover, it would remove an artificially low barrier to outsourcing and perforce make same more expensive absent tariffs. Special relationships with countries whose standards, wages and security mirror our own should be recreated.

2.) Illegal immigration should be stanched. While not as big a population as that of China or India (or China and India combined) the illegal population represents a substantial group that will work for extremely low wages and, as such, negatively impact wage growth.

While the US is and should remain a melting pot, a society is not likely to absorb a group twenty-times its size and maintain the status quo.

Let us be quite clear, while there are US policies that have done disservice, the sum total US policies have done great service to US people and foreign people all over the world.

Adding, in too rapid fashion, too many people of any nationality, religion or ethnicity that do not support core US principles threatens the US socioeconomy because it is likely to tip the balance away from core positions.

3.) Insourcing should be dramatically curtailed. Our institutions have not expanded to include more than 6 billion people vying for positions. In order to rebuild US capital, US positions must be substantially limited to US citizens.

The US cannot employ, educate, feed and etc. the whole world. The US can employ, educate and feed some foreign people and lead by example.

4.) Taxes should be raised on corporations and wealthy; and, in the meantime, money should be printed to replace credit and invested in projects with long term benefit, esp. infrastructure, education, defense and clean-energy technologies.

It should go without saying: Infrastructure makes every daily pursuit possible. Safe neighborhoods, reliable power lines, running water, driveable roads, sound bridges and so on and so forth are indispensable to civil society and high productivity. Of course, to the extent that these suffer civil society and productivity must also suffer.

But, civil society and productivity also suffer when children are poorly socialized and educated. Successive generations must be taught the core principles, techniques and skills—the wisdom upon which success is predicated or be all but guaranteed a darker tomorrow.

History makes clear that the world is navigating treacherous waters. And, the US is in a weakened state. Cuts in defense spending could not be timed more inappropriately than now. While new bombers and manned aircraft might be put on hold, the US would be foolish to divert money from myriad technologies as diverse as unmanned aerial vehicles and energy production that will ensure US hegemony.

The US cannot stand up for freedom and democracy and lie prostrate at the feet of foreign despots. Clean, cheap energy technologies sufficient to US demand will ensure our independence, while creating hundreds of thousands of jobs and products to export. Stewards should hasten such technological advances while putting people back to work.

VII

The positions outlined here are in keeping with a long US history of independence, freedom and equality under a strong central government.

Make no mistake, while it is indeed possible that the US has changed so that we will welcome socialism or peaceably abide poverty and starvation it seems unlikely.

Fundamental change no more exotic or painful than restoration of flow of currency can change the tide. If we hope to avoid the real dangers on our present course, we will make the change.

There is no magic place where money doesn’t flow but people prosper.

Advertisements

Part III.C. Regarding US Unemployment

1. ‘The proof is in the pudding’

Relatively-high, steady unemployment is not compatible with civil society when a relatively acquisitive, motivated people confront social programs that only reinforce hardship and success.

Now, it appears that there are more US Americans who would work than there are US jobs to do. This is not the case. The US people need challenging, satisfying work now more than ever because they are “on edge” and strapped for cash. Moreover, innovation will be product of a lot of hard work.

Notwithstanding that recent “boom” times were characterized by relatively high US unemployment (see Fig. 1 below for data on the US Unemployment Rate since 1948) there must be work for the unemployed to do.

2.

Human-capacity utilization is being slashed instead. It would appear that the steward class does not see high employment as a responsibility of US stewardship. US pundits wonder aloud, who’s at fault for high unemployment?

Many so-called conservatives cry, “People refuse to work! Fat, lazy, beer-drinking, out-of workers – socialists living on the fat of the land are the problem. It’s un-American.”

The left is flabbergasted. “Now, now… It’s the corporate fat cats,” they tell the middle class, as if they had taken vows of poverty. “It’s CEOs and corporate lobbyists, who laze about smoke-filled rooms, while you build America.”

3. ‘Finger-pointing’ (AKA, Proximal cause)

Of course, an individual must be incentivized and make a choice to work. Individuals do not incentivize themselves. Who is responsible to incentivize workers? Are they doing that or not?

Data on US income inequality clearly show diverging pay scales of small-and-shrinking proportion at the bottom and large-and-growing proportion at the top. That is, it looks like the topmost tier is and has been consolidating wealth and removing some portion of monetary incentives for decades.

Further, relatively “high-paying” (middle-class) jobs are disappearing to foreign nations where they can be done more cheaply. In place of such jobs, so-called “McJobs” have appeared. Many find such work neither satisfying nor worthwhile.

But, now, all jobs are coming under the axe as stewards and managers ‘restructure’ to ‘maximize efficiencies and profits’.

These data strongly suggest that US workers are and have been losing battles for middle-class wages and satisfying jobs. Individuals within the steward class that makes policy and those under them, who manage finance and companies, and those under them, who manage divisions, and so forth must be accountable because stewards create jobs, set pay scales, hire and fire.

However, in that stewards want to live a little bit better than they have at any instant (e.g., now) are they not just like their compatriots? They’re just a little better at getting what they want.

4. ‘The meat of the matter’ (AKA, Distal cause)

What an individual feels and believes and can accomplish for itself has steadily gained importance in the western world, esp. the US. Now, it appears that the individual matters more than societal concerns, of which we admit fewer and fewer over time. The result is a new west where, much like the old west, it’s every man for himself. A middle-class democracy cannot exist indefinitely in such a state.

Some examples stand out from the pack. Bernard Madoff and Allen Stanford clearly take first and second place, respectively. Others fade into the woodwork. If, for example, we assume that Ben Bernanke had compelling evidence to suggest that the Merrill deal must go through and pressed Ken Lewis to make the deal, does it matter if Mr. Bernanke did what he believed was best for the country in pressing Mr. Lewis to complete the deal? It must! Can Mr. Bernanke have violated US law if he did what a preponderance of evidence suggested was best for the country despite the fact that a relatively small group of risk takers suffered a financial setback, or, he might have violated the terms of an imperfect law? Which is more important, an individual or the country? The country or the law?

The good of a country does not change over time. Our understanding of it does, and so, our laws change to better approximate the national interest because a country’s laws exist first and foremost to effect the national interest! As such, absent foreseeable, avoidable and/or greater wrong, it hardly seems an act can violate law if it is reasonable, appears the best of alternatives and is intended to effect national prosperity.

Yet, secular, self-centered individuals now want and believe that they can do whatever they like within the law without repercussion (because “it’s a free country”, virtually everything not specifically addressed by current law). The law is become sacrosanct. The law is become an offensive weapon.

This may be par for the course among third-world ruling classes, but, it cannot work within the context of a middle-class democracy precisely because it obviates the possibility of a middle class: When one societal group is so inclined, capable of outmaneuvering another group and consistently allowed to take advantage of same, the long term result must be oppression or eradication of the weaker group, here, the US middle class.

Approaching an extreme in the US, when a plurality of individuals threatens civil society, self-centered and selfish individuals give only cursory thought to others – rarely more than is absolutely necessary – and, generally, persuade themselves of the rightness and goodness of their own interests: freewill, as a philosophy, does not allow the possibility of responsibility for actions that do not violate the law but only actions that violate the law. Believing thus absolves law-abiding individuals of guilt and, in so doing, sets in motion a positive and pleasurable feedback loop. Moreover (in free countries like the US) coupled, extreme visions of freewill and individuality effectually subvert the justice system: laws addressing specific actions cannot possibly foresee infinitely-diverse bad actions, and, because we do not admit an enforceable “spirit of the law”, bad actors are free to act unless there’s a law that prevents them from doing so.

When bad actors act in the self-interests described, while they fight to keep the law off their bad actions and achieve success as a result, they attract and make converts of others.

The result is a socioeconomy so corrupt that is does not see itself as corrupt. Corruption is become business as usual. And, rising unemployment over time (as illustrated below) is just a symptom.

Fig. 1, Unemployment Rate 1948 Jan – 2009 Aug, based on unemployment rate data by month over a period 1948 Jan thru 2009 Aug obtained from the Bureau of Labor Statistics. Red line is linear regression calculated by Microsoft Excel. Upper (green) and lower (yellow) brackets highlight amplitude of swings.

The unemployment rate has clearly trended up over this time period (from approx. 5% to approx. 6.3% – a rise of approx. 25% in the portion of the population that is unemployed at any instant). More disturbing, however, is the change in unemployment-cycle amplitude in the postwar period, illustrated by the brackets. The highs and lows seem to be diverging. But, finally, the troughs are getting higher. During “boom” times US unemployment is staying higher.

5. The positive feedback loop in action

I can make more money if I pay less. I want to make more money because I want and believe that I deserve more. Nobody is stopping me from employing fewer people. And, I can employ them at a lower rate.

Since I don’t believe that I have any responsibility to employ people, and, I have no responsibility to my fellow countrymen, I will find ways to increase productivity with fewer workers and pay them less.

…I have done so, and, I have kept more money. I live a slightly more lavish lifestyle and have consolidated more wealth. But, I know I can live a more lavish lifestyle and consolidate more wealth if I can further increase worker productivity while keeping money in my pocket. Moreover, I can pay even less if I outsource relatively “high-paying”, middle-class jobs to “business-friendly” nations.

I will invest in technologies that eliminate the worker and outsource middle-class jobs to lower-class countries where I will pay middle-class workers according to lower-class rates.

…Success!

Other people see what I am doing. They are impressed. And, they do it, too.

The unemployment rate ticks ever up. Some hypothesize that the natural unemployment rate might not be even 5% but something higher. And, so forth and so on.

Of course, the principles that underlie this logic extend beyond employment to all facets of human endeavor.

6. A curious justification: human rights

While the justification described may be sufficient to have set the loop in motion, still, present justification for actions that negatively impact the domestic socioeconomy jibe nicely with “progressive-”liberal ideology. Specifically, so-called “bleeding hearts” would put an end to injustice in the world. Irrespective merit-of-the argument, the argument supports substantial US investment in foreign countries: it takes a lot of money to elevate a poor population from poverty into the middle class.

Will to furnish that money never existed in the US steward class. (The same people have used profits of outsourcing and insourcing to pay themselves more.) Yet, the plan was clearly lucrative over the short term.

Jobs were moved overseas, and, money that would have lined US-middle-class pockets went with them. This would have been fine and could have been sufficient to raise many poor foreigners out of poverty if it had been temporary. But, wages of poor foreign workers did not rapidly approach US-middle-class wages, and, adequate foreign demand would not develop. (It seems plausible that many foreign populations are generally less acquisitive than the US population and will, as such, tolerate a low standard of living that US people will not. Further, foreign workers who might pressure foreign stewards routinely migrate to the US leaving a vanishingly motivated people behind. Thus, foreign stewards might easily fail to see the benefit of higher domestic standards of living.)

While outsourcing and insourcing effectively grew the US workforce out of all proportion to the number of available US jobs and the same globalization replaced US workers with cheaper foreign workers, US-middle-class income continued to decline. Moreover, the goods that the US middle class consumed and the services with which it was furnished originated overseas with greater frequency. This further diminished US capacity for demand.

When the US middle class could no longer afford the effort to spread US-middle-class democracy in a hostile world, US stewards doubled down. In order to pay for the plan in the face of diverging pay scales, rising US unemployment and relatively weak foreign demand, the bankrupt US middle class was furnished credit that US consumers were eager to use. But, now the plan must work because there was never any hope that US-middle-class people could repay the staggering debt they would accrue if foreign wages did not rise to US-middle-class levels, and, outsourced jobs never “returned” home. Further, the US steward class was ill-prepared to cover its losses and never intended to do so.

We now know it was a bad bet. The US middle-class could not prop up poor foreigners whose steward classes would not adapt to the demands of progressive-liberal US ambitions. The US middle class was gambled into servitude.

But, the US people didn’t “come to America” to be poor, indentured servants. Just the opposite. “No taxation without representation!” they cry. “Live free or die!” The US has always attracted relatively acquisitive and extremely motivated people who are looking for a “better” life, revolutionaries. Moreover, many tens or hundreds of millions of US Americans have already lived some version of the “American dream”. Taken together, these facts strongly suggest that the US middle class, without anyplace to go, will revolt.

It must be time to retrench.

7. Solution to the example, unemployment (AKA, “It’s past time to get tough”)

The US steward class must cover its losses and, then, institute the changes that must be made in order to regain standing in the world and maintain a vibrant civil society:

(1) (a) Raise minimum wage for all those emancipated and/or adult US individuals to some “relatively-high”, middle-class level (based not on a USD amount but some fraction of the upper wage); and (b) guarantee unemployment benefits (at some significantly lower, “poverty” rate) to every citizen whose household income is below the minimum-wage figure per capita.

(2) Guarantee health coverage to every US American.

(3) (a) Stop trade with countries that refuse to adopt similar policies; (b) severely limit immigration from same; and (c) prevent domestic entities and other entities based in trading-partner countries from outsourcing services to and developing products in non-trading-partner countries.

8. How it works

The unemployed cannot pay their own unemployment benefits, let alone medical bills. And, under this plan, there is significant benefit to work. Still, the plan is ineffectual if US business entities can get visas for cheap labor and employ cheap labor abroad. So, the law must be reformed to stanch the flood of cheap foreign labor.

Thus, under this plan, US employers are effectively compelled to employ every emancipated or adult US citizen and end the deadly trend to mass poverty that results when the steward class does not rightly estimate its relationship to a civil, acquisitive and motivated middle class. At the same time, the unemployed have strong incentive to work to stay out of poverty.

Which is better for the employer: an employee who does nothing and gets paid, or an employee who adds to net income?

Domestic employers will bend over backward attempting to make money off of those whom they have to pay (i.e., US Americans) and the number of US jobs will expand out of proportion to the number of US workers. Otherwise, US companies might (1) move to the third world, where they need not pay or (2) regress (i.e., forfeit high quality of life). In the event that more than a very few choose (1) they’ll have either to change the third world, or, as in (2) they won’t live well because demand for their goods will be much lower and, as a result, their incomes will drop substantially while they will face a hostile population in relatively wild lands. That is, there isn’t enough room at the top tier of the third world to absorb a mass exodus of top-tier first-worlders, and, it seems unlikely that the steward class would choose to recreate the third world at home.

For the same reason that companies will not relocate en masse, the US people will find it better to enjoy the comforts that a little work brings. It appeals to virtually everybody to work for “something better” because it’s human nature (as will be explored in some later part).

In any case, the US will retain advantages that it has always had: diverse, creative, motivated US people working within the framework of the US constitution and (now centuries-old) institutions. While restored domestic-demand capacity will grow the socioeconomy, the kind of work that US people have done historically will breed continued innovation and further progress.

That this plan is good for every US American and the citizens of all US trading partners is self-apparent. But, further, it is good for citizens of our non-trading partners because it provides the strongest incentive to make progress on issues that plague these countries (e.g., income inequality and human rights). They will have no choice but to commit to change or squander US investment. Now that these countries have experienced growth and higher living standards associated with US-middle-class investment, it should be hard to go back to the old ways.

A sliver of a slice of US American and foreign stewards will understand that it means an end to tyranny and, because they cannot see how that benefits them (either because they actually cannot understand or because it flies in the face of the supreme belief that their interests are more important than their nations’) the plan will not suffice to persuade them that the next phase in the evolution of civil society will afford a higher quality of life for all.

They will fight it tooth and nail – not because it’s a bad plan (bad for the US and US-trading partners) but because it is a good plan that is good for the US, US-trading partners and the world; and, to their way of thinking (which equates personal benefit with personal wealth) that’s bad for them.

Response to Global Trends 2025, Part I: Country at a Crossroads

Posted in *HIGHLIGHTS, National Security, Politics, Public Policy, Socioeconomy by equanimist on November 26, 2008

US technological and strategic advantages are not insuperable and, the US has lost luster (if not real ground). To retain (or regain) global standing, US “elites” must voluntarily or US stewards must demand that they take aggressive proactive roles developing innovations that will assure continued great power status or be willing to (1) leave successive generations a weaker and increasingly less relevant US, (2) experience real declines in domestic standards of living and (3) leave the US and its allies prone to a hostile multi-polar world wherein destruction might be mutually assured and success might be mutually precluded. Will the US rise to the challenges of 21st century leadership?

First on a long to-do list is an overdue green revolution. The world wants power to fuel rising standards of living. Fossil fuels will be insufficient to supply demand (esp. within a context of global climate change). Whoever develops cost-effective low-impact energy solutions to meet ever increasing energy needs will wield extraordinary power in a new middle-class world. Alternatively, it seems only reasonable to assume that emerging-power energy requirements will significantly raise the possibility of international conflict.

Second, significant overtures ought be made to bring China and Russia into the Western fold. Western powers ought not appease these rising Eastern powers and, there is no sense in antagonism. (Does Poland need missile defense, for example? Should not a meaningful US umbrella suffice?) Western civilization is not a cult of democracy but a democratic solution to the problem of good governance. Is there no room in the West for liberalization on different tracks? Is there no possibility that we might learn something new? We are not so young or so unstable that we cannot stand a little competition. Parallel development of effective governance strategies ought not be viewed with fear but with healthy skepticism. China, in particular, does seem to be following a liberalization strategy and, as such, may be seen to approach Western-style socialized democracy vis-a-vis democratized socialism.

Third, while excessive nationalism is generally insupportable and counterproductive, the US is clearly spread too thin. More care must be taken that globalization is not a race to the bottom. Global Trends warns against some vague “protectionism” that might be better described as isolationism (and xenophobia?) That the US cannot recoil from the world does not admit that the US can afford the consequences of too liberal foreign policies. A balance must be found between the national and global interest.

Fourth, the US must reinvest in infrastructure (to include human capital). Among themes that recur in Global Trends, the US despite extraordinary natural, intellectual, cultural and technological resources is losing ground. The implication is US infrastructure is failing for lack of maintenance. The Ayn Rand model of Greenspan’s “free-”market capitalism is failing. Too liberal market policies have resulted in nearly four decades of radical redistribution of wealth on the one hand and decelerating pace of US innovation on the other. For as long as US stewards continue to indulge libertarian market fantasies and refuse to make hard choices, US infrastructure will deteriorate because self-interested individuals cannot be counted upon to make consistently wise strategic decisions. Isn’t that why we adopt governance over anarchy in the first place? Complacency and profit taking (profiteering?) have left the US vulnerable and pose real danger to US standing.

Election night recap

Posted in '08 Election, Politics by equanimist on November 5, 2008

Sen. McCain gave a most gracious and magnanimous concession speech. And, though I am one of about five people who voted Nader, I swell with pride in my country and hope for our future: Barack Hussein Obama, a black American with about the worst possible name in history, is President-elect! A million backward racists go to sleep crushed. JOY. Tears well in my eyes.

On the Art of Power Consolidation: considering language on the campaign trail

Posted in Language, Politics by equanimist on November 4, 2008

I begin to think that politics and voting likewise have become the art of power consolidation.

Modern US politicians have appropriated language to stir powerful emotions and in so doing (1) imply that they are the opposite of whatever they trash, (2) build trust, (3) emotionalize susceptible constituents against the other guy and (4) justify policies of power consolidation.

So-called “conservative” constituents on the “right”, for example, conflate socialism and fascism (probably because the Nazis had the audacity to call themselves National Socialists and nobody challenged the language that they used to define themselves.) These same “right”-wing “conservatives” conflate the philosophy of Marx with the rule of Stalin.

When Barack Obama talks about “spreading wealth” it sounds like socialism. Ergo, he sounds like a fascist because fascism and collectivism are part and parcel. When Sarah Palin draws a connection between Sen. Obama and socialism and Marx, the “conservative” “right”-wing knows what she means. Moreover, they must feel validated. (That’s what they were thinking!) Validation furnishes Gov. Palin with additional credibility establishing improved trust. Repetition rouses the rabble. And, in the coup de grace, these particular conflations lend themselves to justification of power consolidation itself (a singularly un-American public policy). If it’s wrong to collectivize then it’s right to capitalize. If it’s wrong to redistribute wealth then it’s right to concentrate it. And so forth.

Delineation, indoctrination, motivation and justification accomplished.

The tactic cuts both ways. This happens to be a particularly elegant example but, Barack Obama uses terms like “spreading wealth” to the same ends. Substitute “Europeans” for “Nazis”, “Lennon” for “Stalin”, “left” for “right”, and so on. It will amount to about the same thing.

I suspect that campaigning and voting then solidify support among voters. After all, when the Electoral College (or the Supreme Court) will choose the next President, why campaign? Why vote? Advocacy enhances loyalty: Indoctrinating others effects ownership of the party line!

And, the result is an extraordinary consolidation of power.

Deconstructing "socialism" (Update 1)

Posted in Language, Politics by equanimist on November 1, 2008

The following is cross-posted at We Op-Ed in reply to a comment on “Descent into Fascism”. That said, I submit to you:

Socialism and fascism are associated to a purpose; socialism and democracy are not mutually exclusive; and socialization of democracy improves citizens’ lives demonstrably.

Conflation of socialism and fascism is a politico’s game. On the one hand, it is “half a lie” (in the A. L. Tennyson meaning: dissembling). The US government is collecting assets but socialism emphasizes collectivization and, as such, fails to define the character of current trends in US public policy. Since the attacks on September 11, US public policy has been to consolidate US hegemony and, in practice, that has entailed extirpation of civil rights at home. (Secret prisoners are tortured at secret prisons, for example. Free speech is confined to “free speech zones”. And so forth.) That the government now seizes ownership and/or redistributes is just a symptom of the underlying issue: a will to effect strict control. That, in itself, is not socialism. That’s fascism. So, while it is true on its face that we are “heading towards socialism,” it’s a false argument. On the other hand, the word “socialism” is highly emotionally charged because of the Nazi association. [Thus, warning against “socialism” is an effective means of (1) distracting/confusing US citizens and (2) advancing the illogical conclusion that consolidation of power is democratic.]

If we deconstruct the issues then, clearly, socialism is perfectly compatible with democracy. If, for example, the state owns a corporation and legislators control that corporation then the people who elect those representatives in effect run that corporation via representative democracy (e.g., US democracy). The same can be said of some pool of money or, as in Alaska, resources. That’s actually very liberal and very democratic.

When we refuse to define governments by the language with which they describe themselves and define them, instead, by their primary characteristics then the Nazis were rightly fascist. Persecution and extermination have nothing at all to do with socialization except in that the Nazis called themselves National Socialists — guilt only by association. Our own major parties call themselves Republicans and Democrats but the former aren’t republican and the later aren’t democratic. Persecution of political opponents and minority groups is fascist. Consolidation of wealth and power is fascist. Unilateral policy-making is fascist. And so forth.

A great many democracies collectivize to advantage. I cannot here reproduce the very lengthy study reported by the Organisation for Economic Co-Operation and Development (OECD). However, the very real difference between capitalism (which is trending toward a tyranny of the few a la socialized fascism) and socialized democracy (collectivization within a democratic framework to benefit the people) is drawn into stunning relief in the latest release from the OECD (to which I have linked here).

The proof, as they say, is in the pudding. Social mobility, income equality, poverty rates and quality of life are demonstrably and quantitatively better in Europe’s socialized democracies. (There’s a great piece about how much longer Europeans live in a back issue of Foreign Affairs, “Healthy Old Europe”. It’s written from a capitalist perspective, so it’s all about squeezing them.) For how much longer [the European democracies can support extensive social programs] remains unknown. I fear that their heavy and ill-advised investment in US capitalism may drag them down with us. However, as Europe adopted our democracy, we might do well to take a closer look at current successful trends in European democracy.