Impossible Gridlock or Impossible Ideologues

For liberal Froma Harrop, the problem is the non-negotiable Tea Partiers.

The tea party movement has become the dead bad-luck bird hanging around the GOP establishment's neck. Its anger-fueled energy has forced moderate Republicans off ballots in places where moderates tend to win. It has burdened otherwise centrist Republicans with radical positions that don't go well with a general electorate. The Grand Old Party is being taken over by an ideological fringe with unclear motives, a loose grasp on reality and little interest in actually governing.

But for conservative Michael Walsh the truth is a mirror image.  Even if Romney wins in November, Republicans are still pushing upstream against the progressive tide.

They know from history that American counter-revolutions never really restore the status quo ante, and that “progressive” ideas are nearly impossible to root out, especially with the media blocking for them. And they know their unfireable, beetling minions in the judiciary and the regulatory agencies aren’t going anywhere soon, no matter who wins.

Notice the contrast.  Froma Harrop says that the impossible Tea Partiers will never amount to anything because they won't compromise.  Walsh says the Republican revolution will never work because they will never get the power to dislodge the immovable liberal bureaucracy.



On the other hand, at The Atlantic Philip K. Howard writes that the problem is the partisan stalemate. Nothing can be done because "we," conservative or liberal, cannot upset "our" base, the people we have mobilized to fight to the death for our party.

American government is a deviant subculture. Its leaders stand on soapboxes and polarize the public by pointing fingers while secretly doing the bidding of special interests. Many public employees plod through life with their noses in rule books, indifferent to the actual needs of the public and unaccountable to anyone. The professionals who interact with government -- lawyers and lobbyists -- make sure every issue is viewed through the blinders of a particular interest, not through the broader lens of the common good. Government is almost completely isolated from the public it supposedly serves.

Well, all I can say to all that is good old Stein's Law.  If something cannot go on forever, it will stop.  In my view we are in a Clausewitzean decisive battle.  There is no doubt that the liberal welfare state cannot go on forever.  It has promised benefits way beyond what the economy can deliver.



So there is a choice.  It is the choice is between Argentina or civil society.  Do we go on, like Argentina, from devaluation to easy money to crisis to devaluation, with a corrosive populist politics that claims to want to squeeze the rich like sponges, but actually keeps the working class in feudal bondage and serves the crony capitalists?  Or do we change course,  back out the big government programs and replace them with a revived civil society?



I would that the United States would not go the way of Argentina.

What Do Liberals Really Believe?

Government is force, and politics is power.  Politicians and activists are bullies--when they are not being cowards.  So people that follow politics have to lie to themselves a lot in order to persuade themselves that they are on the side of the angels instead of the thugs.



Capitalist enthusiasts do this a lot.  The fact is that the Anglo-American empire utterly conquered the world in the last three centuries and not one stone has been left un-turned.  But we Anglo-Americans like to tell the story that we have ushered in an age of milk and honey.  Maybe we did, but we also took a lot of sled-dogs behind the rock and clubbed them to death.



Our liberal friends are like that too.   They are convinced that they are the harbingers of peace and justice even as they shatter civil society, turn every human activity into a government program, and break every rule that they set.



Want some examples?  Here are just two from today.



In Massachusetts, the failure of RomneyCare has prompted liberal politicians there to pass a "cost-containment" bill.  It will basically allow the state government to dictate the operation of the entire health care industry in Massachusetts.

Under the plan, all Massachusetts doctors, hospitals and other providers must register with a new state bureaucracy as a condition of licensure—that is, permission to practice...



An 11-member board known as the Health Policy Commission will use the data to set and enforce rules to ensure that total Massachusetts health spending, public and private, grows no more than projected gross state product through 2017, and 0.5 percentage points lower thereafter. (And Paul Ryan's Medicare projections are unrealistic?)



No registered provider is allowed to make "any material change to its operations or governance structure," the bill says, without the commission's approval. The commission can also rewrite the terms of provider contracts with insurers and payment levels and methods if they are "deemed to be excessive."

Or there is this.  The Obama Department of Labor doesn't want defense contractors to follow the law in sending out layoff notices to employees in advance of the November election.

One of Big Labor's legal pride and joys is the Worker Adjustment and Retraining Notification Act, a 1988 law that requires federal contractors to tell employees at least 60 days in advance of potential large-scale layoffs. Well, what do you know, last week the Department of Labor issued "guidance" on its website that this law doesn't need to be followed for the purposes of the looming January 1 budget sequester.

When Republicans are in office, the mainstream media blows items like these into major scandals.  There is extravagant talk about the rule of law and abuse of power.  In the Obama years we have seen many flagrant abuses similar to today's mere two abuses of power, and the mainstream media has said nothing.



The brutal truth about politics is that it is civil war by other means.  Partisans on both sides excuse the abuses of "their" side while howling about the abuses of the other guys.  That's why we need reporters to make a fuss about any abuse of power.  It's a pity that the media so rarely live up to their responsibilities.



Well, there is this, from Nicholas Wade in The Faith Instinct:

Men like power and will seize it if they can. But if they can't rule, their next preference is that no one rule over them.

Maybe, just maybe, this fall the human second preference will rear its noble head.

Unemployment Sideways

Imagine if John McCain had won the 2008 election and unemployment was currently at 8.3 percent.  Yes.  The howls, the scandal, the monstrosity, the cruelty of it all would be bellowed out of every MSM outlet.  And there would be no chance, not one, that McCain could get reelected.



But here we are, and either employment increased last month by 163,000, according to the Establishment Survey, or declined by 195,000, according to the Household Survey.  Either way, the economy is not growing fast enough to get Americans back to work.  Right now, we are about half way back to the number of jobs in the US at the start of 2008 before the crash.



Let us not forget that the Obama administration deliberately made a policy choice back in 2009.  They would push the hugely expensive ObamaCare and the hugely bureaucratic Dodd-Frank financial reform.  And they would push their expensive green energy, and they would obstruct fossil fuel development.



If you had wanted to implement a slow recovery from the worst financial crash since the Great Depression, that is the policy mix you would have chosen.  We can assume that the Obama people didn't think that their interventions would be that harmful to the economy.  After all, everyone wants to be reelected.  They probably didn't really think about it.  They just went ahead with their agenda and assumed that their trillion dollar stimulus program would be enough to get the economy going.



But it hasn't.  And the evidence is that the Obamis really don't understand a thing about the economy.  Their new Consumer Finance Protection Bureau is busily reintroducing the failed policies from the Community Reinvestment Act that forced banks to loan money to unqualified borrowers.  Don't they get it?  When you leverage up the economy with bad loans you set up a big financial crash when things start to go south!  Just like in 2008!



And then the president says "you didn't build that."  Well, yeah.  Business people don't build roads and bridges.  But they do everything else.  You could look it up.

How To Defend Capitalism

Mitt Romney, writes Ramesh Ponnuru, ought to respond to Barack Obama's attack on capitalism with something more than ten point programs.

To respond to Obama’s attacks on outsourcing and Bain, Romney ought to unveil something more compelling than another tax return.

Yes, but how?  People are right to fear outsourcing.  And they are right to fear private equity companies like Bain.  Capitalism is a fearsome thing.  It may be true that you work for a company that is getting slowly flushed down the toilet, but if it lasts until you retire, why rush out to get Bain to fix things if they ain't quite broke?

Don't look back, as Satchel Paige said.  Something may be gaining on you.

Capitalism has always had to take the rap that it doesn't give a rip about people.  The market economy is the law of the jungle and the weakest go to the wall.   Back when I worked for a consulting firm, my fellow workers would get shocked when the firm laid people off.  Look what it says in the employee manual, they said.  Look how it says that the firm cares about employee development.

Yeah.  They may care a lot, but when they see the company in the red for three months in a row, they will do the instinctive thing.  They will act to save the company, not the employees.  And really, this is nothing out of the ordinary.  What do you think an army is all about?  It is about sacrificing young men so the nation as a whole will survive.  The government may idolize the Fallen every Memorial Day and  those who served every Veterans Day, but the fact is that those mother's sons are still dead.

Both corporations and governments are pretty ruthless when it comes to survival.  They sacrifice their employees and their young men generously during hard times.  But people understand the social requirement for the government to defend them.  Anyway, most people aren't young men.  But when it comes to corporations acting to save the corporation, people identify with the folks losing their jobs to machines or outsourcing.  There but for the grace of the fickle market go I.

But there are ways you can protect yourself against the vicissitudes of the market, just as there were ways for the agricultural villager to protect himself against the vicissitudes of the weather.  Workers can save.  If they don't earn much they can mutualize their savings by joining a benefit club or fraternal association.  In the old days, labor unions were mainly mutual-aid associations.  For those with a bit more money, there is insurance.  For those with more money still there are savings accounts, bonds, and stocks.  Oh, and guess what:  there is family.

Yes, but shouldn't all these benefits be provided by your employer or by the government?  Well, you tell me.  That employer thing didn't work out so well for the old-line steel companies, and the only reason that the auto workers aren't totally screwed is that the government stepped in, screwed the widow-and-orphan bond-holders, and made good the corporation's broken promises, courtesy of the taxpayers.  And as for government, how do you feel about collecting on your Medicare or your Social Security in 20 years?  The latest estimate is that we are about $100 trillion short if the government means to pay out on its promises.

The point is that both corporations and governments are ruthless outfits interested only in #1.  Individual people, to corporations and governments, are expendable.  But there is a solution.  It is called civil society.  It is the social space in between the mechanical monoliths, the megastructures of business and government.  Civil society includes every organization that is in the business of people helping people.  They don't have power; they don't have influence.  That is why they can afford to think about the needs of their members rather than the glory of the collective.

Conservatives have been banging on about civil society since Edmund Burke and his "little platoons" over two centuries ago.  Civil society flourished mightily in the 19th century, as ordinary people formed fraternal associations, churches, labor unions, charities, benefit clubs, friendly societies, you name it.  Of course, they couldn't perform miracles; for one thing, the world was a lot poorer back in the 19th century.  In the 20th century, government got into the act and nationalized most of the functions performed by the "little platoons."  There turned out to be a problem with that.

The problem is the age-old problem in any association of social humans.  It is the freeloader.  In any community, there will be people that don't pull their weight.  They figure out how to game the rules and they do.  Traditionally, society has confronted this problem with naming and shaming, which works in the face-to-face community.  And religion has solved the problem with the concept of divine justice.  You may think you are getting away with your cheating, but God is not mocked.  He knows, and he will deal with you in the next life when you find yourself burning in Hell or, in Plato, in the river of Tartarus down at the center of the Earth.  But the welfare state has turned out to be a veritable Springtime for Freeloaders.  Just get yourself defined as a victim and you can live at the expense of your fellows forever.  That is why the welfare state is going broke.

The solution to big business is not big government.  And the solution to big government is not big business.  Nor can we go back to an imagined Garden of Eden where true community reigned.  We have invented modern business and modern government and we can't uninvent them.

But we can create a human space in between the ruthless megastructures.   We can grow a vibrant civil society in the spaces between the Bigs. That is what conservatism has wanted to do for decades.  And that is how we reckon we can defend capitalism from itself.

The Inequality Two-step

Inequality is the polite drawing-room version of the Exploitation narrative.  The Exploitation narrative, so ably set up by Marx, says that the workers inevitably get screwed by their employers.  So government is needed to redress the balance.



The Inequality narrative is more nuanced. It says that inequality is getting worse, so government is needed to redress the balance.  In a review of Timothy Noah's book on inequality, The Great Divergence, Scott Winship takes us through the many mansions of liberal ideas on inequality, and how it is getting worse.  Of course, liberals like to tell this story in a Three Ages template.  First there was a Golden Age after World War II when inequality was low due to strong labor unions, but then, after 1973, it all fell apart as the rich got richer faster.  In the new age, liberals will rectify the problem.  Here is Timothy Noah's solution.

Noah wants to “soak the rich,” create a public-jobs program, “impose price controls” on colleges, “revive the labor movement,” and “elect Democratic Presidents.”

The poor do better under Democratic presidents, you see, although I doubt if they are doing very well under Democratic President Obama.  And the Buffett Rule will stop people from becoming rich.



The problem with the Inequality narrative is that people don't stay where they are put.  Thomas Sowell:

The turnover of people is substantial in all brackets — and is huge in the top 1 percent. Most people in that bracket are there for only one year in a decade.



All sorts of statements are made in politics and in the media as if that top 1 percent is an enduring class of people, rather than an ever-changing collection of individuals who have a spike in their income in a particular year for one reason or another. Turnover in other income brackets is also substantial.



There is nothing mysterious about this. Most people start out at the bottom, in entry-level jobs, and their incomes rise over time as they acquire more skills and experience.

So, what does it do when you impose over this changing situation big clumsy government programs that assume that "the poor" and "the rich" are enduring categories?



There are three steps to the Inequality program, and every step is fraught with questions.  First of all, how much inequality is in fact harmful and unjust?  Second, can programs be devised to ameliorate inequality?  Finally, can any program avoid the introduction of new, legally mandated inequalities?



The record isn't good.  Let's look at a few.  We have universal education, yet clearly middle and upper income people benefit from the education system much more than the poor.  The poor get lousy schools, and the children of the rich get lifetime professorships.  We have national pensions.  But that means that the poor never get a chance to accumulate real wealth, since the government collects their retirement savings through taxes and then returns it in a benefit payment.  Upper-middle class people save money for homes and retirement.  But the money is not just directed at single uses.  It is available throughout life, for starting a business, sending kids to college, for travel, for end of life care.



The liberal approach to everything is a rigid, one-size-fits-all government program, that is so big and clumsy that it can never be reformed.  The smart people figure out how to game the system and the poor get left with the crumbs.



There has to be a better way to deal with inequality.

Uncle Miltie at 100

Milton Friedman was the classic smart Jewish kid.  He was smart, he worked hard, and he never backed out of an argument.  We need more of his kind.



For conservatives he represents a nuts-and-bolts defense of capitalism, while Mises (another smart Jewish kid, from the city of Lemberg, now Lwow in the Ukraine) represented a more Kantian, philosophical approach.  Hayek, I would say, because of his detour through Britain, brought more of a British empirical approach to the subject.



Milton Friedman was the public face of free-market economics because of his Free to Choose TV series.  But why, you will wonder, did PBS agree to put such a man up on TV?  The reason is that conservatives were miffed that the BBC and other public broadcasting agencies had put up John Kenneth Galbraith on TV with his hymn to liberalism, the 13 part series called The Age of Uncertainty.  What about our guy, was the cry!  So, grudgingly, PBS put up Milton Friedman for a 10 part series.



Today's eulogizers seem to remember Free to Choose as a stunning success, but I remember feeling that it didn't quite come off.  The main reason, I felt, was that Galbraith in The Age of Uncertainty came across as urbane and cool, whereas Uncle Miltie was hot and combative.  Of course, Galbraith was the liberal's favorite liberal, lionized wherever he went and telling liberals exactly what they wanted to hear.  Friedman was a smart Jewish kid telling the establishment things it didn't want to hear.



Do we need another Milton Friedman today, someone who can teach free-market economics to a new generation?  No we don't, any more that we need a new Ronald Reagan.



A generation ago Milton Friedman taught men that free-market economics was the only way to go.  It was better for men to battle for market share than to battle for bureaucratic power.



But the task now is to teach women that civil society will create a better world for their children than centralized one-size-fits-all programs from the government for health, education, and welfare.  You'd think it ought to be a breeze, because women don't like being treated like a number in a line at the DMV: they think that their child is unique and that their mother's health care requires individual attention.



So we are still waiting for the smart Jewish kidette to amaze us with her brilliance and lead women away from the liberal culture of compulsion and home to freedom and the true social relations promoted by civil society--the society, in a word, of people helping people.

Dems Wasted Oughties Enthusiasm

I don't know whose idea it was, but someone decided that the Democrats would take the toss-up election of 2000 and rile up the base.  So all the liberal Subaru Outbacks carried Re-Select Bush bumber-stickers right through the 2004 election.  Har-de-har-har.



You can see the results at Gallup.  In summer 2004 Democratic voter enthusiasm was at 68 percent, in summer 2008 it was at 61 percent, while Republican enthusiasm was at 51 percent and 35 percent.



Today things are different.  In summer 2012 Democratic enthusiasm is at 39 percent and Republican enthusiasm is at 51 percent.



In my view the Democratic decision to crank up partisan rage back in the early Bush years has proved to be a strategic error.  Of course, I felt back in 2001 that the decision to insist that the 2000 election was stolen was an act of meanness.  After all, when the Democrats obviously stole the 1960 election in Illinois and Texas Richard Nixon took it like a man, because he didn't want to divide the country (and who knows, maybe he thought it wouldn't help him).



The partisan mobilization turned out to be an error because Democrats taught their followers to believe that a win in 2008 would "fundamentally transform" America.  Now that the Obama administration clearly hasn't transformed anything except the national debt, what will the partisans do?  Where will they go?



They will get demoralized.  Meanwhile, the rest of America is getting enthused about getting to the polls.



There is a good reason why the Obama win has turned to ashes.  It didn't come up with anything to deal with our underlying economic and social problems.  Liberal partisans suffer under the delusion that their agenda is something fresh and new.  It isn't.  It is just big government wanting to simplify and organize and control the people.  As governments have tried to do right down the ages.



The magic of social animals, from ants to zebras, is that we do the right thing instinctively, without being told. The magic of all living things is that they are adaptable.  They respond to changing conditions by changing their ways.



The problem about big government is that it is designed to treat humans like machines.  The problem with big government is that when conditions change it does not change.  The same is true, to a lesser extent, with big business.



The problem for Americans is how to reform big government into adapting to the future before it drives us all off the cliff.



That is why the Democrats ads featuring Paul Ryan pushing grannie over a cliff are such a joke.  We want to be nice to grannies--and to grandpas like me--but only up to a point.  First we have to make sure that the average working stiff doesn't go over a cliff, not to mention the average mom, and the average student, and the whole economy.



That, presumably is what President Obama means when he says that "I believe that the way you grow the economy is from the middle out. I believe in fighting for the middle class because if they’re prospering all of us will prosper."



The only problem is that the notion of growing the economy "from the middle out" is utterly fatuous.  It means, of course, that the president will take money from the rich via the Buffett Rule and give it to the middle class.  The only problem is that redistribution doesn't grow the economy.  Never did, never will.



The only problem is that Democrats just don't get it.  And now they are losing the big head of steam they worked up in the Oughties when the evil Bush was president.