The Empire Strikes Back

September 15th, 2015

There are plenty of frightening things about Trump’s campaign.

What is most frightening is his xenophobic appeal to nativism. It has given voice to an ugly white bigoted segment of society that has always been there, but was not discussed in polite company. These are the neo-nazi white supremacist racists who have enjoyed resurgence over the past eight years because a black man was in the White House. They were able to scream their bigotry in the public square because conservative Republicans claimed it was all politics. The worst stuff imaginable was suddenly fashionable among those who opposed the President because of his politics AND his race.

While they weren’t looking, however, conservatives have discovered that Trump is not just a racist, which they understand. He is also a populist. Worse yet, he is a rich populist, which seems an oxymoron, but doesn’t seem to disturb his followers. Even more terrifying to the conservative Republican establishment, his populism hasn’t just targeting illegal immigrants. It has also targeted bloated corporations who have had their way for too long and CEO’s who have been packing it in at the expense of their workers.

This is a very interesting turn of events. Ever since Reagan coopted the evangelical political movement awakened by Carter, Republican candidates have run on a whole platform of social issues. Once elected, however, they only delivered on the fiscal issues that were most important to their big money backers. Over the years everyone assumed that social conservatives actually cared about all of these fiscal issues too. Turns out that those supporting Trump don’t really care about the reducing taxes, expanding federal programs, and state’s rights. They understand the impact that big money has had on politics and are just as unhappy about large corporations and high income CEO’s as they are about illegal immigrants. Trump, running as a conservative Republican, hates free trade deals, loves Medicare and Social Security, wants to punish big companies that ship their jobs overseas, wants to tax CEO’s with cushy comp packages, and pledges to hold boards more accountable for their crony capitalism. In that regard Trump is MUCH closer to Bernie Sanders than he is any other candidate on the Republican ticket.

As Paul Krugman points out

The influence of big-money donors meant that nobody could make a serious play for the G.O.P. nomination without pledging allegiance to supply-side doctrine, and this allowed the establishment to imagine that ordinary voters shared its antipopulist creed.

But Mr. Trump, who is self-financing, didn’t need to genuflect to the big money, and it turns out that the base doesn’t mind his heresies. This is a real revelation, which may have a lasting impact on our politics.

The empire has inevitably begun to strike back.

The Club for Growth, that mainline supply side shill for political big money, is raising money to start running ads against Trump because of his tax policy.

Their hope is that they are going to be able to convince enough conservative Republicans that Trump is not their friend. This is going to be really interesting because the moment those ads begin to run I predict his poll numbers will improve. Rather than vilify Trump, these attacks from the conservative Republican establishment will validate what Trump has been saying all along. Those that have been sitting on the sidelines not sure that Trump is the real deal will realize that the Republican establishment, whom they also don’t trust, DOES take him seriously. They believe that he is dangerous. They recognize that he isn’t going to succumb to their influence. And finally, the establishment is terrified of what will happen to them if Trump is elected. This attack will be the sort of endorsement some of those on the sidelines have been waiting for. Trump will use these attacks to double down on his message of change. He will say, “If you really want to see changes, rather than the same old three card Monty that the Republican Party has been running, vote for me”.

If Trump is able to prove that these sorts of attacks will backfire and that organizations like the Club for Growth no longer have the weapon they claimed, the Republican Party will enter a brave new world. They will be required to really debate fiscal policy on the basis of what is best for the voters rather than what is best for their big money interests. If that occurs, we could really see a Presidential election where Bernie Sanders and Donald Trump both agree that the wealthy should pay more taxes, corporations should be penalized when they ship jobs offshore, trade pacts should benefit US workers, the social safety net should be strengthened because it benefits those that depend on it, and healthcare should be available to all at a cost that all can afford.

Compare this to the tax plans of the rest of the clowns on the Republican candidate bus.

Cruz, Paul, and Carson all favor a flat tax. Easy math says that the flat tax has to be somewhere around 25% in order to fund the government at current spending levels. Paul is at 14.5%. Carson at is 10%. Cruz hasn’t said. Beyond that, the flat tax is a huge give away to the wealthy who are paying significantly more in taxes today.

Huckabee is proposing a consumption tax. This federal sales tax would add $.23 to ever $1 spent on anything or an effective rate of 30%. The problem is that economic think tanks across the political spectrum say that it wouldn’t even come close to funding the government at its current level of spending.

Bush’s tax plan is the most interesting just because it is so weird. He has already promised that supply side economics will produce 4% growth for as far as the eye can see. But the details of the plan make that naïve prediction seem rational. Here are some quotes from a good article on the subject from fivethirtyeight.com

Bush’s plan offers an unlikely combination of solutions to the problem of slow growth.

He wants to cut the income tax rate and eliminate the estate tax and the alternative minimum tax — all policies that would benefit mostly the wealthiest Americans. At other times, he sounds like a populist, calling for the closing of loopholes that benefit corporations and hedge fund managers. And at others, he sounds like a policy wonk, arguing to shift tax policy in a way that encourages companies to build rather than borrow.

There’s no way to calculate yet what impact Bush’s proposals would have on the federal deficit, for example, or exactly how much more or less specific groups would pay in taxes. He hasn’t identified the corporate loopholes he would close or said whether closing them would fully offset his proposed cut to the headline corporate income tax rate.

The summary is that this is a politically motivated plan that borrows something from every other candidate including Clinton and Sanders, bundles it all up in a big confusing bag, and then wraps it in a bow of promised 4% growth. The reality once you strip everything away is that it is the same old voodoo economics that Reagan was forced to abandon, Bush I rescinded, and Bush II used to turn a surplus into a deficit.

The reality, at least for the moment, is that there are a lot of angry white voters out there who are unhappy with the Republican establishment. There are also a lot of frustrated progressive voters out there who are eager for a candidate willing to mount a full throated defense of progressive principles. Trump and Sanders are riding these respective waves. It is unclear whether those waves will propel both candidates to their party’s nomination, but the political establishment is becoming very uneasy with this populist uprising.

Talk is Cheap

September 3rd, 2015

The definition of character is the mental and moral qualities distinctive to an individual. I would suggest that character is the mental and moral qualities that DEFINE an individual.

We discover our character and the character of others when we are faced with hard choices.

Character is aspirational. It is not something that you are born with. It is something that you acquire through a lifetime of making difficult choices.

David Brooks just wrote an entire book that digs into the subject in some detail.

Our hope is that the primary season will give us an opportunity to discover more of the character of our potential candidates. That will give us a better understanding of how they will behave when they are inevitably faced with the hard choices that happen in every Presidency.

Here are two good examples.

The financial collapse of 2008 happened during the campaign for President. Obama reacted with a cool confidence the belied the political implications. He was willing to look at the best available solutions regardless of their party affiliation. He also was able to prioritize those things that were most important to do now, and those things that were most likely to have bipartisan support. McCain on the other hand seemed to panic. He was overwhelmed by the potential for failure as well as the huge risks this posed to his presidential candidacy.

The public’s perception of the difference in their reactions led to Obama’s victory. Some of Obama’s critics claim that the electorate didn’t know who they were voting for and would have made a different choice if they were better informed. I strongly disagree. This public test of character led those voters who hadn’t already made up their minds to choose Obama.

There are certainly some who will view Obama’s presidency as a failure, but he will leave office with an historic set of big achievements that will secure his place in history. Those including saving the country in general and the domestic auto industry in particular from the financial collapse, dramatically reducing the deficit through economic growth rather than wholesale cost cutting, successfully reforming healthcare, extracting us from two wars, refusing to engage our troops in new ones, and negotiating a nuclear deal with Iraq. None of those choices were a slam dunk. All had significant political risks and encountered significant opposition. In each case, he stayed the course. That’s character.

Bush won one of the closest elections in recent history. Unfortunately his “character” moment came early in his Presidency when he was informed of the 9/11 attacks while reading stories to school children. The “deer-in-the-headlights” look that came over his face at that point spoke volumes of his ability to perform under pressure. While he spoke of leadership, his administration was awash in cronyism and infighting. This came to full flower in the disaster that was Iraq, the deceptions regarding torture and domestic spying, the Valerie Plame coverup, and the tragedy of Katrina. Katrina has since become shorthand for one of these moments of failed leadership.

Let’s look at the character of a few of the current crop of wanna-be Presidents.

Trump is a narcissistic bully. In his case, he isn’t claiming to be anything else, so in some ways he passes the character test. He is going to do what is best for him. Those who don’t agree with him are losers. Those that he may harm in the process are losers. Losers in his opinion deserve their fate and he is not going to worry about them. If he manages to become President, I suspect we will all be losers.

Chris Christie’s claim to the office is also based on his tough-guy get it done narrative. But when you look at his character moments, something else comes into clear view. He is vengeful bully with “Bridge-gate” as only one example. His state is in terrible financial shape (though he claims otherwise), and now he is being “out-bullied” by Trump.

The Jeb Bush narrative was that he was a seasoned, smart, effective leader. We had a hint of his issues when he fumbled an obvious question about his brother’s failures in Iraq. The answer that he wanted to give was that he loves and respects his brother and is not going to criticize him in public. Then he could have laid out his plan for dealing with today’s Middle East realities. He didn’t have the character to give that sort of brave answer. Now, he can’t seem to find a way to respond to a bully who calling him, his wife, and his children names. Trump even challenged Jeb’s manhood by calling his campaign “low energy”. The result is that those who thought of Bush as a front runner are now questioning why he is even in the race. Turns out that the smart, effective, self-aware, self-confident leader story was fiction.

How about Walker? He was the bright shining star of the conservative movement. His character moment came when he was caught scrambling to get to the right of Trump on immigration. When one of his financial backers suggested that perhaps he had gone too far in opposing birthright citizenship, Walker quickly hustled back to safer ground.

Oh, and you remember that guy that at the start of the summer was reminding all of this Republican peers of the 11th commandment not to criticize another Republican. Now that he is no longer leading the pack, he’s decided that the 11th commandment no longer works for him.

Turns out that Walker wasn’t the star everyone thought he was. Instead he is a political opportunist who is being exposed and out-maneuvered by a political neophyte. In Trump terms, a loser.

How about Rubio? When he had an opportunity to reveal that there was substance behind his youthful good looks, we discovered that there was not much there. His strongest issue should be immigration, but every time that he has been challenged on that issue, he retreated to the safety of right wing conformity. Much like Romney, Rubio’s desire to be elected overwhelms the basic values he talks about in his speeches.

I’ve already outlined the character flaws in Rick Santorum who chose politics over religion.

What about Hillary? Her character appears to be tested on almost a daily basis. It also appears to be wanting because of choices she made during her stint as Secretary of State. Now as some of the “inside baseball” emails come out, it appears that there was considerable “Obama envy” among some of her staff. She obviously at least tolerated, if not encouraged this attitude. I don’t think that there is any doubt that she is tough. The doubt is whether or not she has the character to be able to make decisions based on what is best for the country versus what is best for her. Her front-runner status is again eroding as Bernie Sanders attacks her from the left.

Bernie has had his character moments too. But he has learned from them. Now his greatest assets are his passion and authenticity. One look at him will tell you that he is not the product of a focus group. His positions are consistent and provocative. It is unclear whether or not he will win the nomination, but in the character wars he is FAR ahead.

I could go on, but I think that it is clear that character-building is a process rather than a destination.

What is troubling in this race so far is that those with the best character appear to be those with the least chance of winning the nomination.

It will be interesting to see how this plays out over the next several months.

Trump and the Crazy Train

August 14th, 2015

There is certainly one thing that you can say about Trump – he is entertaining.

What people aren’t talking about is the fact that ALL of the Republican presidential candidates are in one way or another just as crazy as Trump.

Trump represents an interesting populist anti-establishment uprising that has surprised the party establishment, the media, and Trump. He is also the natural evolution of the “money votes” economy. Rand Paul was on the right track when he said that Trump is “used to buying politicians”. He has simply taken the next step of by passing the middle man and representing his own interests. Whether he is able to translate this into a nomination is yet to be seen.

He gained momentum by demonizing undocumented workers. He fanned the flames of xenophobia by claiming that Mexico was deliberately sending their most dangerous citizens to us to deal with.

All of the rest of the candidates were dragged along to support Trump’s claim that there is a crisis at the border. Rubio tried to distance himself from his previous support of a path to citizenship. Walker also changed his tune. Christie called his previous support a “garbage idea”. Even Trump had flipped from his earlier support of path to citizenship. Only Kasich, Hackabee, Carson, and Paul have resisted the urge to jump on the “we’re being overwhelmed with criminals” bandwagon.

The problem is that fact checkers call this claim false. Illegal immigration peaked in 2007 and has actually declined since. Deportations hit an all time high in 2013 of 400K. Most of those were convicted of crimes in this country. More robust border enforcement has not only dramatically reduced illegal immigration, but it has also discouraged undocumented workers from leaving this country for fear that they won’t be able to get back in. The result is a fairly stable population of undocumented workers in this country of 11M. Their children, at least those born here, will automatically be citizens. If these trends continue, within thirty years the number of undocumented workers will drop by 50% without any other actions on our part.

So the only value in building a bigger wall is that it will likely provide some jobs for those that the wall is intended to keep out.

How about abortion?

Trump flipped from his previous support of abortion.

Rubio lied about never supporting exceptions to abortion.

Bush questioned whether, “we need half a billion dollars for women’s health issues.”

Huckabee said he would ignore the Supreme Court and declare that a “baby inside the mother’s womb is a person at the moment of conception.”

Santorum, who has built his political career on his opposition to abortion, took the opportunity to question Carson’s character because Carson used fetal tissue in his medical research. “When you start to see some of these cracks, I think it may show whether the person is really someone who’s going to take on an issue and be strong on it when they get into the very difficult position of being President of the United States.” An interesting attack from the guy who recently failed a significant test of character when he had to choose between politics and his religious faith on the topic of climate change.

How about healthcare?

Trump flip flopped in his previous support for single payor.

All promise to repeal Obamacare and replace it with something better. NONE have said what that something better would be other than some discussion that health savings accounts would be nice.

How about the use of our military in the Middle East?

Rand Paul is the only one who would not put “boots on the ground”.

Fiorina lied when she claimed that the US wasn’t arming the Kurds. We are doing it through the Iraqi government.

How about the economy?

Jeb promises that he can deliver 4% growth off into the future based on his experience in Florida and his belief in supply side economics. The reality is that he presided over a huge real estate bubble in Florida. When it burst, shortly after he left office, 900K of the 1.3M jobs he claimed to create vanished. Funny the same thing happened to his brother’s supply-side experiment.

Many economists think that 4% is just out of our reach because of the demographic headwinds of the baby boomer retirement. You really have to believe in the fairy dust of supply side economics to project that we would touch 3% as a result of government policies.

Christie claimed some big job numbers, but his state ranked 44 out of 50 in job growth.

Walker did not elaborate on his failure to deliver the 215K jobs he promised would appear as a result of the massive tax cuts he gave business. Instead he talked about job growth and job participation numbers. What he didn’t say is that these were the same numbers that existed prior to his election.

Huckabee solves everything with a consumption tax. One of the advantages of that tax is that even “illegals, prostitutes, pimps, and drug dealers” would be paying this tax. He claims that tax will generate 6% growth. I have to admit that 6 is better than 4 which is certainly better than 2, but just changing the tax policy won’t do it. You have to get more workers which just isn’t going to happen unless there is also a radical change in immigration policy which is not part of Huckabee’s plan. Even if you got more workers, you would also have to have a significant change in productivity because wages would have to track this growth in order to get more money into the economy. Huckabee hasn’t even thought of this because his consumption tax shifts most of the tax burden to the poor. All he has thought about is that 6 is better than 4.

Then there is Doc Carson, who suggest that we should all tithe 10% of income instead of pay taxes. When asked whether or not it would work, he said that if it worked for God, it will work for us.

Summary

In this context it isn’t surprising that Trump is having the success that he has been having. The reality is that the only half-way serious candidate in this train full of clowns is Kasich. Not surprisingly he is the most moderate of the bunch and as a result, the least likely to get the nomination.

This speaks volumes about what the Republican Party has become. This is no longer the party of George HW Bush or even Ronald Reagan. It has become the party of paranoia and extremism as the old white angry men, who have been the party’s backbone, struggle with the reality that they are no longer in control. They failed to defend marriage from the onslaught of gay rights. They failed to prevent the rollout of what they see as another big entitlement program in Obamacare. Black people are demanding justice. Hispanics have discovered the power of the ballot box. Even the Pope disagrees with their abortion obsession. And women are no longer content with staying home and raising children. They not only demand a career, but also equal pay for equal work.

These guys are growing tired of the effort required to hold back the flood of scientific evidence supporting human-caused climate change. Their dam has sprung so many leaks that they are running out of fingers to plug them. Coal-based electrical generation is not only polluting, it is expensive. The most economical and highest performance car is all electric, made in this country, and sold direct over the internet. The world is changing under their feet and there appears to be little they can do to prevent it except perhaps support someone who is willing to give voice to their fears and frustrations – Donald Trump.

Marco Rubio Camelot Detour

August 13th, 2015

Marco Rubio has a problem. He has to find a way to distinguish himself in Republican primaries when the major emotional flow is fueled by xenophobia.

He was supposed to be the leader for the new generation of young Republicans. Good looking. Latino. Basically the Republican version of JFK. Unfortunately as Wart learned, the road to Camelot is not paved with gold or even good intentions. The road is a test of character. It is a test that Rubio has so far failed.

There were his frequent flips regarding immigration, the Iraq war, and national security spending.

His most recent flip regarding exceptions to abortion bans for rape, incest, or the health of the mother may be his most profound.

He has claimed that science now supports the assertion that a human life begins at conception. That claim is the basis for reversing his previous support of exceptions to abortion.

He appears to base this little bit of verbal gymnastics on the fact that a fertilized egg can only produce a human embryo. If that embryo is carried full term a baby is born.

Science explains this because of human DNA. It is this DNA that determines how the fertilized egg will grow and evolve. If human DNA is present in the cells of both the egg and the sperm, a human embryo will result every time.

What is wildly inaccurate though, is the claim that science supports his view that this fertilized egg is in fact equivalent to a human being. It is not. It is a fertile seed of a human being much in the same way that an acorn has the potential be an oak tree, but still needs a lot of growing to reach its potential.

Science does not take a position on when life begins. It has a method for determining the when something is alive. A human baby passes that test. A human embryo does not.

Rubio’s position is getting him some needed press visibility, but it is also going to damage him if he manages to make it to November 2016.

The country may be split on abortion rights, but women support abortion rights 50% to 41%. Obama coalition is built on women, minorities, immigrants, young people, LGBT, and educated professionals. If Hillary Clinton is the Democratic nominee, she is doing a pretty good job of holding that coalition together.

Rubio’s opportunity in the election cycle this year will likely be as a VP. Whomever ends up being the Republican nominee will choose between Rubio, Kasich, or may Fiorina.

What is interesting is that while Rubio is of Hispanic origin, Kasich is the one who supports a path to citizenship. Kasich, and not Fiorina, also supports abortion exceptions in the case of rape, incest, or the health of the mother. Rubio is from Florida. Fiorina is from California. Kasich is from Ohio. What state decided the last couple presidential elections? – Ohio.

So the path in 2016 for Rubio may not lead to Camelot. That’s because when it comes down to character, it turns out not to have anything to do with looks, ethnic background, or gender. It is a basic choice grounded in principle and tested under stress. The one person in the Republican field who appears to have passed that test won’t get the nomination for President, but is in a good position to get the VP nod – John Kasich.

Courts Decide

July 3rd, 2015

The Supreme Court recently did what they are empowered to do – make decisions based on their best interpretation of the constitution.

The Constitution provides for an independent judiciary for a reason. We are a nation of laws where the power of the majority does not trump the rights of the minority. Our federal judges are appointed to reduce political influence.

The court also decides issues that we can’t resolve at the ballot box.

During this time of deep political polarization, every decision produces a backlash of second guessers. The same court they agreed with yesterday somehow betrayed them today. You’ll likely see some of that across the Internet with appropriate doomsday predictions.

Americans deserve leadership that can actually fix our broken health care system, and they are certainly not getting now from Washington, DC. Jeb Bush

From the beginning, it was clear that ObamaCare would fail the American people and this has proven to be true across the country and in Wisconsin. Scott Walker

The reality is that while not perfect, Obamacare is meeting its goals. Over 10M insured and the healthcare growth rate has slowed to its lowest rate in decades. This despite the fact that 25 Republican states have refused to expand Medicare. Also NOT ONE Republican candidate has produced a detailed replacement plan that can be scored against Obamacare.

I will not acquiesce to an imperial court any more than our Founders acquiesced to an imperial British monarch. We must resist and reject judicial tyranny, not retreat. Mike Huckabee

This decision will pave the way for an all out assault against the religious freedom rights of Christians who disagree with this decision. This ruling must not be used as pretext by Washington to erode our right to religious liberty. Bobby Jindal

The states are the proper place for these decisions to be made, and as we have seen repeatedly over the last few days, we will need a conservative president who will appoint men and women to the Court who will faithfully interpret the Constitution and laws of our land without injecting their own political agendas. As a result of this decision, the only alternative left for the American people is to support an amendment to the U.S. Constitution to reaffirm the ability of the states to continue to define marriage. Scott Walker

What is funny is that the founding fathers created the judicial branch to protect the people from an imperial exec and legislative branch. Also at the time of the decision, 39 states had already approved gay marriage.

Those that complain about the court being politicized, recommend packing the court with conservative justices as the remedy. Yet, it was supposedly conservative justices who participated in the majority in both cases.

Then there were the appropriate predictions of the apocalypse.

Santorum said stopping gay people from marrying was about “the survival of our country.”

Sen. Ted Cruz said it was “the darkest 24 hours in our nation’s history.”

Santorum might be correct if the country were exclusively populated by gay men, but it’s not. We are, in fact, in the midst of a baby boom. So clearly there are plenty of people still willing to contribute to the next generation even if that generation includes some married gay people.

As far as dark hours, at least from an existential perspective, this one isn’t very high on the list. Pearl Harbor, 9/11, the murders of the Kennedy’s, MLK, and Licoln; the Great Depression, the Great Recession, the Civil War, and Valley Forge all come to mind well before we get to this most recent SCOTUS decision.

Here’s what was actually decided.

Affordable Care Act The dispute was over six of the 363,086 words in the law. The part of the law said that insurance purchased through “an exchange established by the state” qualified for subsidies. Narrowly interpreting the law in this fashion, according to the court, led to many more serious contradictions throughout the rest of the law. The court decided (6-3) that Congress intended ACA subsidies to apply regardless of how insurance was purchased. The court encouraged Congress to be more careful in the future and left open the option for future legislation on the subject.

Same Sex Marriage The court decided (5-4) that adults have the constitutional right to marry. States can’t limit that right based on sexual preference. This decision doesn’t affect state laws regarding children, monogamy, or bestiality. It doesn’t affect who churches decide to marry. It doesn’t compel any business to change their practices. It only requires states to provide marriage licenses to all adults who apply for them and meet the requirements of that state (not already married, no sexually transmitted diseases, etc.).

There are certainly those who feel that this decision violates their religious beliefs. I would only remind them that similar religious arguments were used to support slavery, oppose female suffrage, support segregation, and oppose interracial marriage. Very few legitimate churches support those views today.

The courts aren’t perfect, but they do serve a vital role in our democracy. While I welcomed these decisions, I too was deeply disappointed by others (e.g. Citizens United). We all have the right to disagree, but we also have the responsibility as citizens to respect this constitutional process. If you want change, vote.

Money Corrupts

June 19th, 2015

One example of modern day corruption is the estate tax repeal that the republican house recently passed.

I’m working on another post that digs into the whole topic of corruption in more detail, but here’s a quick overview to provide some historical context to this discussion.

The framers of the constitution felt that corruption was the single largest threat to democracy.

If you remember your history, the United States was not the first democracy. That was Athens. But democracy was still a novel idea when the colonies decided that they had to be independent of the King. One of the arguments against democracy was the natural instinct of self-interest. The other argument was that the rich and powerful in Europe had been able to undermine democracy. The livelihoods of so many people depended on the good graces of royalty, for example, that few opposed their rule.

The framers, however, believed that individuals would value liberty so highly that civic virtue would trump self-interest. They were not so naïve, however, as to assume that this willingness to sacrifice for the greater good would continue once those who experienced the revolution passed on. So they regarded anything that would subvert civic virtue, or even have the appearance of self-interest, as corruption.

It’s through that lens that I’d like to look at the repeal of the estate tax. This isn’t to suggest that this is the only example of modern corruption. It’s just an obvious one.

The estate tax charges the wealthiest .2% of American households when they pass on amounts in excess of $5.4M in the case of individuals and $10.9M in the case of couples to their heirs.

This estate tax has been part of the US infrastructure since 1797. Its explicit purpose is to prevent the sort of corruption that the founders associated with a permanent aristocracy. By making it difficult for one generation to share their wealth with another, it discourages the formation of families with enough money to damage civic virtue. Specifically the concern was that our representative democracy could erode to an oligarchy if the government didn’t specifically take steps to prevent the concentration of wealth in the hands of a few. James Madison warned that inequality in property ownership would subvert liberty, either through opposition to wealth (a war of labor against capital) or “by an oligarchy founded on corruption” through which the wealthy dominate political decision-making (a war of capital against labor).

Here are some of the justifications leading Republicans have used for eliminating the estate tax.

House Ways and Means Committee Chairman Paul Ryan, R-Wis. claimed that the estate tax is “absolutely devastating” to family farms, and further he claimed the repeal would remove “an additional layer of taxation” from assets that had already been taxed.

“It sounds to me like there’s a lot of wealth envy in this country,” Rep. Virginia Foxx, R-N.C. The bill abolishing the estate tax, she said, “will draw a line in the sand.”

The facts are that only 120 small businesses and farms (100 of them large farms) were hit by the estate tax in 2013. And for that tiny number affected, there are all sorts of provisions already in place to soften the blow: low valuation rules, delayed tax payments and other breaks and discounts. In fact some have characterized the estate tax and a fine for those who failed to pay their accountant, since careful planning can generally avoid this tax.

Also 55% of the value of estates worth more than $100M, according to Americans for Tax Fairness, are unrealized capital gains that have never been taxed. If the issue were double taxation, there is a much better way of addressing the issue than simply eliminating the estate tax.

Besides the obvious risks of increased concentration of wealth in the hands of a few, there are real budget implications of repealing this tax. The tax will bring in $269B over the next ten years. Republicans are going to say that putting this money back into the hands of the wealthy will increase other tax revenue by causing economic growth, but there are no facts to support this claim. What the data shows is that tax cuts to the rich only reduce the middle class, increase the ranks of the poor, weaken our economy, and increase our debt.

To put this gift to the wealthy in perspective, here are some of the other things that could be done with that amount of money.

  • Making community college free for everyone for ten years cost $60B
  • Making four year college free for all that qualify would cost an additional $15B
  • Plugging the current highway trust fund deficit which would support infrastructure improvement costs $164B over the same time period

If at this point you are asking what does all of this have to do with corruption, the house members who voted for this bill received a combined $56M in campaign contributions during the last election cycle from special interest groups specifically advocating the repeal of this tax.

This may not meet the narrow standard of corruption that the Supreme Court used to justify the Citizen’s United case, but it does justify the fears that our framers had regarding the corrupting influence that money has on our democracy.

Climate Change Infallibility

June 16th, 2015

Here’s how twisted the climate change debate has become.

The Pope feels that he has to weigh in.

His opinion?

Climate change is real.

Climate change is a moral issue because of the damage being done to the poor.

His formal remarks on the subject will be published in an encyclical due later this month. Encyclicals are letters that Popes send to Bishops. The purpose is to instruct the Bishops on the Catholic Church’s position on particular issues. This is serious stuff. It is not an invitation for dialog. It is a statement of how this particular issue is going to be taught by the Bishops going forward. The Pope expects all good Catholics to follow the church’s teachings.

The reaction on this side of the ocean is incredible.

Catholic republican conservative Rick Santorum has built his political career on his religious beliefs. He opposes abortion and same sex marriage. On ISIS, he believes that the US should “bomb them back to the seventh century.” He believes that immigration is contributing to economic problems because immigrants are taking jobs from citizens. As a result, he wants to reduce LEGAL immigration by 25%. He opposes any path to citizenship for illegal immigrants. Finally, he rejects scientific evidence that human behavior is causing climate change. He walks pretty much straight down the right wing conservative Republican political platform while wrapping it all in a mantle of Catholicism.

The problem is that conservative Catholics also believe in papal infallibility. That means that when the Pope speaks on matters concerning faith or morals, it is not only binding for all Catholics, but it is divinely inspired and cannot be wrong.

So this puts Rick Santorum in a difficult spot. Which is more important to him – his religion or his politics? Here’s his response.

I would just say this: The church has gotten it wrong a few times on science, and I think that we probably are better off leaving science to the scientists and focusing on what we’re really good at, which is theology and morality.

Not only does he reject the whole concept of papal infallibility out of hand, but he also questions the Pope’s right to view climate change as a moral issue. Finally he uses the church’s past denial of the scientific evidence supporting a sun-centric planetary system, as evidence that the church isn’t trustworthy when it comes to science. He advises the Catholic Church to leave science to the scientists.

This is the height of hypocrisy. That’s because Santorum’s political position of climate change denial fails to follow his own advice to the Catholic Church. Instead of leaving science to the scientists, Santorum rejects the current scientific consensus regarding the causes of climate change because it conflicts with his RELIGIOUS views.

Here is how Santorum defends calling climate change “a hoax”.

If you leave it to Nature, then Nature will do what Nature does, which is boom and bust

And

We were put on this Earth as creatures of God to have dominion over the Earth, to use it wisely and steward it wisely, but for our benefit not for the Earth’s benefit.

Rick Santorum has no standing in the scientific community. His undergrad degree is in Political Science from Penn State. He got an MBA from Pitt and a JD from Dickenson. Pope Francis, on the other hand, IS a scientist. He has a degree in chemistry and worked as a chemical technician before entering the priesthood. He CAN speak with authority on the science.

He can also speak with authority on the morality of climate change because he is the head of one of the world’s largest religions. He isn’t the first to speak out either. He is one of a long line of Pope’s who have treated climate change as a moral issue.

Environmental protection and the connection between fighting poverty and fighting climate change are important areas for the promotion of integral human development – Pope Benedict XVI

In our day, there is a growing awareness that world peace is threatened … by a lack of due respect for nature – Pope John Paul II

So we have a conservative Republican politician who has so blurred the lines between his political views and his religious views that he can no longer see the difference. He rejects the leader of his church claiming the Pope isn’t qualified to make a scientific judgment because of the church’s opposition to Gallileo – even though the church’s position is motivated by morality. Despite the fact that the Pope himself is a scientist, Santorum dismisses the church’s position as out of step with the scientific community. Then he uses exactly the same Biblical passage that the Catholic Church used to defend itself against the scientific claims of Gallileo, to support his own rejection of the scientific community’s conclusion that human actions are causing climate change.

In other words he tells the church to quit politicizing science and then turns right around to use his own religious beliefs to politicize science.

This raises an obvious question of whether Rick recognizes the Pope as his leader. Here’s what he told a radio interviewer in January.

I mean, it’s sometimes very difficult to listen to the Pope and some of the things he says off the cuff…. I keep coming back to the Pope is the leader of the Catholic Church, and when he speaks as the leader of the Catholic Church, I’ll certainly pay attention. But when he speaks in interviews, he’s giving his own opinions.

Santorum’s rejection of the Pope’s encyclical on climate change is just another example of the hubris of the man. This is a perfect example of the solipsism that appears to infect the right wing conservative movement. There isn’t even the hint of self consciousness in Santorum’s statements even though they are obviously contradictory. That’s because there is only one ideology that he follows – right wing conservatism.

That is his god.

That is his religion.

The fact that he can campaign as a serious candidate only highlights the deep cynicism that pervades the conservative wing of the Republican party.

Fortunately the Bible warned us against these people.

A double minded man is unstable in all his ways James 1:8

Poverty and the Social Safety Net

June 7th, 2015

Here’s a quick recap of what we have learned so far.

Conservatives have developed a set of narratives to explain why our best efforts to eradicate poverty have failed. These narratives all revolve around a central core claim that programs which attempt to assist people in need actually perpetuate that need. That’s because, according to this “logic”, aid of any sort reduces the incentive to work. The foundation of this view is that if the poor were willing to work as hard as the middle class they would quickly join the middle class. Lately there has been another twist to this point of view. If the middle class were willing to work as hard as the wealthy, they would be wealthy too. These views are consistent with the conservative moral foundation that hates that possibility that anyone might be able to “cheat” the system.

A recent study by the Pew Research Center for example found that three-quarters of conservatives believe that the poor “have it easy” because of government benefits. Only 1 in 7 believe the poor lead “hard” lives.

We have gone through a very interesting eight years where a lot of these assumptions were tested.

During those eight years the ranks of the poor swelled as many previously middle class people lost their jobs, their homes, and their savings. They were forced to file for unemployment, food stamps, temporary need to dependent families, and many of the other assistance programs that are the target of conservative scorn.

Now we are finally emerging from this long period of economic decline.

If the conservative theories are correct, those who were out of work for a long period of time and receiving benefits, should be demonstrating some dependence because of the corrupting influence of those benefits. We should be able to see evidence of that dependence in a reluctance to return to work.

One example would be the number of people on food stamps. That should remain high even as the unemployment rate goes down.

Guess what?

The number of people filing for food stamps has gone down at pretty much the same rate as unemployment.

The same thing is true regarding the claim that poor women have children in order to support themselves with the meager benefits provided for mothers with dependents. If that actually was a strategy, we would see the birth rate among the poor go up during times of high unemployment. Instead the birth rate among the poor went down, just like it did in the overall economy.

We’ve also seen that the behavioral effects of poverty cross racial lines. As more poor people fell into poverty over the past 8 years, their families disintegrated too. They saw increases in drug use, violence, and crime. They also experienced declining health. While life expectancy among the wealthy has gone up, life expectancy among the poor has gone down.

The real answer is much simpler.

If you want people to demonstrate middle class values, you have to provide them middle class jobs.

If you want to reduce the ranks of the generationally poor, you have to break down the barriers that institutional racism use to literally wall off poor minority communities from prosperity.

Finally, we have to have an honest conversation about the value of a social safety net in preventing people from falling into poverty. The psychological and physical damage they suffer in that condition can make it difficult for them to recover.

Here are just a few examples from a study by the Federal Reserve.

Poverty is an issue for our elderly. 25% of the elderly depend entirely on Social Security benefits. 50% get more than half their income from Social Security. That’s because 30% of the rest of the population have no retirement savings or plan at all. That same percentage of people report that they went without some medical care over the past year because they couldn’t afford it. 25% reported that they or someone else in their immediate family had experienced some degree of financial hardship over the past year. 47% said that they would not be able to handle an unexpected expense of $400 or more.

That’s why those Republican states who have refused to expand Medicaid continue to put their populations of working poor at a terrible risk. They remain literally one medical emergency away from bankruptcy.

Hopefully all of this will be included in the discussions of income inequality that I hope will be part of this election year cycle.

The poor are not to blame for their condition. We are.

We have created a system that makes it very difficult for those who fall into poverty to ever get out.

We keep the working poor on the knife edge of financial collapse.

We keep the black community imprisoned in economic and physical ghettos with an asymmetrical police and legal system that punishes them for not demonstrated middle class values. Then we are shocked when every ten years or so the ghettos explode in violence and frustration.

The data is there.

The changes are obvious.

All that is lacking is the will for conservatives to overcome their bias and have an honest an open discussion about how to address the root causes of poverty rather than simply blame the poor for their condition.

Institutional Racism

May 15th, 2015

In the previous post, I made the claim that institutional racism in the form of asymmetrical law enforcement and judicial bias were two of the three motivating factors driving the current demonstrations and violence in black communities across the country.

I suspect that some might dispute the claims of asymmetrical law enforcement or judicial bias, but the numbers here are undeniable. Blacks have many more encounters with police than whites on a per capita basis. They get arrested way more than whites. They are incarcerated at a much higher rate for the same crimes. They receive longer sentences for the same convictions. Ferguson was just one example of collusion between city government, law enforcement, and the judiciary to extort money from the black community for petty infractions. That’s institutional racism.

Another aspect of institutional racism created the ghettos where the vast majority of the black population live. These communities not only have substandard housing, but also no jobs and a very low percentage of home ownership.

Home ownership is the middle class wealth engine. Blacks don’t have access to that engine because they don’t have access to the middle class jobs that can support home ownership. They also don’t have access to that engine because, until the 70’s, they were not able to get mortgages for houses in middle class neighborhoods. Federal Housing policies prohibited it. That’s institutional racism.

Ned Resnikoff dug into the history in an MSNBC piece.

Disparities in homeownership are a major driver of the racial wealth gap, according to a recent study from Brandeis University. According to the authors of the report, “redlining [a form of discrimination in banking or insurance practices], discriminatory mortgage-lending practices, lack of access to credit, and lower incomes have blocked the homeownership path for African-Americans while creating and reinforcing communities segregated by race.”

For those of you unfamiliar with redlining, banks had different policies for different parts of the city. Those policies effectively priced black consumers out of white neighborhoods by charging blacks more to purchase a home in those neighborhoods than they would charge a comparable white customer.

This practice began in 1934 with the National Housing Act which established the FHA and the Federal Home Loan Bank Board. This later agency created “residential security maps” which assessed the risk of real estate investments in different parts of major cities. Black neighborhoods were designated high risk and denied funding. This dramatically reduced both home ownership in black neighborhoods as well as commercial investment.

Speculators stepped into the void left by banks, often with the support of local government.

When selling on contract, the speculator offered the home to a black purchaser for a relatively low down payment – often several hundred dollars would suffice. For bringing the home within the reach of a black purchaser, however, the speculator extracted a considerable price. In the Commission on Human Relations study, the percentage increase in the cost of the home from the speculator’s purchase price to that of the black consumer ranged from a minimum of 35% to 115%; the average increase was 73%.

The next step toward the ghettos that we know today was block busting.

After the riots of the 60’s, whites began to leave inner city neighborhoods for the “safety” of the white suburbs. They took their businesses, jobs, and purchasing power with them. Speculators accelerated that white flight through various tactics intended to convince white home owners that black families were moving into their neighborhood. Realtors and speculators were able to purchase the houses at deep discounts and then convert them to multi-family dwellings that generated significantly more income for their owners.

As neighborhoods transformed from predominantly owner occupied low density to predominantly renter-occupied high density, property values declined. Property tax revenues which are based on property values and which fund local schools also declined. As jobs and purchasing power left neighborhoods, the small business services associated with that purchasing power also left. Neighborhoods that once were vital and sustainable, deteriorated. Whites associated this decline with black pathology. It was in fact a logical result of intuitional racism.

During the 60’s public housing projects were also placed in these same segregated economically depressed neighborhoods as a compromise with conservatives who opposed them completely. These projects were doomed from the start because they also failed to address the fundamental issue of jobs. Instead they simply concentrated all of the pathologies associates with poverty in a smaller geographic area. Gangs, violence, and drug use all became associated with the black family experience rather than the underlying economic conditions that were in fact the root of that behavior.

When you wall-off a whole community from access to the wealth building tools of employment, access to capital, and home ownership – they are unable leave their impoverished areas. Their poverty has a whole set of pathologies that accompany it. This cultural dysfunction and deep generational poverty defines life in the prison that our policies built. Conservative Republican leaders starting with Nixon turned this into a political strategy. Nixon was content to simply play on the same fears of whites that made the block busters wealthy. Reagan was the one who expanded the meme that blacks were dangerous. He convinced angry white voters that the blacks imprisoned in the ghettos that institutional racism created are themselves responsible for the conditions under which our government’s policies have forced them to live.

O brother, where art thou?

Pathology Versus Economics

May 8th, 2015

Responses to racial unrest, most recently in Baltimore, aren’t surprising given what we know about conservatives and liberals. Conservatives focus on rioters calling them thugs and feign surprise at the violence. Liberals on the other hand point to asymmetrical law enforcement in white and black neighborhoods and question why cops are killing so many unarmed poor kids.

Here’s a little history to try to figure out what is going on.

This country was founded on slavery. The slave trade in North America grew right along with European colonization. It was written into our founding documents right along with inalienable rights. The United States fought a civil war to force an end to slavery in southern states. That ended two hundred years of institutionalized and constitutional slavery.

A war weary country, however, failed to eradicate institutional racism. Whites successfully regained the political and economic power that they lost briefly during reconstruction. They exercised that power with impunity for another 100 years until the civil rights movement began to win a series of Supreme Court victories. The pinnacle of that movement was the voting rights legislation passed during the Johnson administration.

Coincident with that legislation was widespread racial unrest. During that period of time there were two seminal studies on poverty and racism.

The Moynihan Report in 1965 blamed the violence on poverty. They blamed poverty on pathological and cultural deficiencies in black families. This report shifted the onus from institutions and policies to families. It coined the term “benign neglect” in recommending that government had done pretty much all that it could to. Rights had risen as far as the study’s authors felt they could. Fixing families required an attitude adjustment by government and blacks. Government had to stop trying to supplement poor incomes. Instead government should encourage poor black families to fix themselves.

The Kerner Commission Report in 1968 took a much more scientific approach. It was based on extensive interviews of all those involved in rioting – young black men, shop owners, police, citizens, leaders, and elected officials. That report said the root cause of rioting was institutional racism. The solution to racial unrest was simple and obvious – social justice and economic redistribution. People rioted because they felt oppressed by the police, persecuted by the courts, and taken advantage of by the business community. Provide those same people good jobs, fair law enforcement, and color-blind courts; and everyone will happily live a peaceful law abiding life.

The riots of the 60’s also terrified white people. They fled the cities for the suburbs and took their jobs with them. Nixon and Lee Atwater invented the Southern Strategy in 1968. It played on white fears. Republicans successfully mined white backlash and rage right up until Obama’s election in 2008.

Reagan famously put another twist on the Moynihan report when he claimed that poverty itself was the result of dependence. He invented the specter of the welfare queen living large on the state. He based that characterization in a bi-racial con artist who was hardly a black stereotype. But the narrative was more powerful than the reality, and a whole series of reforms all the way through Clinton dismantled the social safety net for the poor that was part of the Great Society’s War on Poverty.

So what is the reality? Pathology or Economics.

As always the numbers give us some insight.

Let’s start at the same place that Reagan started, with the welfare queen. Everyone is familiar with this claim. Poor minority women bear lots of children so that they can live off government assistance rather than work. Let’s put aside for a moment the fact Clinton eliminated this sort of permanent assistance. There is a much simpler way to blow up this myth. If it were true, we should be able to see increases in the birth rates of poor black families during difficult economic times. We have just gone through the most difficult 8 years since the Great Depression. The birth rate in poor black families plummeted just like it did across the rest of the socio-economic spectrum. In other words, while there may be individuals who successfully defraud the government, aid to the poor does not create a pathological dependence which encourages women to, in effect, “live” off their children.

The great sociologist William Julius Wilson argued long ago that widely-decried social changes among blacks, like the decline of traditional families, were actually caused by the disappearance of well-paying jobs in inner cities. His argument contained an implicit prediction: if other racial groups were to face a similar loss of job opportunity, their behavior would change in similar ways.

If that’s true, we should be able to see the same social disruptions in white families over the past eight years. If you go look at the numbers, it’s there. Lagging wages — actually declining in real terms for half of working men — and work instability have been followed by sharp declines in marriage, rising births out of wedlock, and more across the racial spectrum.

As Isabel Sawhill of the Brookings Institution writes: “Blacks have faced, and will continue to face, unique challenges. But when we look for the reasons why less skilled blacks are failing to marry and join the middle class, it is largely for the same reasons that marriage and a middle-class lifestyle is eluding a growing number of whites as well.”

The pathology of “bad choices” that conservatives have used to blame the poor for their condition is now being replicated in large segments of the poor white population. They have suffered the same economic displacement over the last eight years that blacks have experienced for generations. That includes shorter life spans, increased violence, broken families, increased drug abuse, less education, decreased home ownership, increased financial instability, and increased chronic illness.

Conservatives cluck about the failure of minority communities to adopt middle class values, but those values depend in large part on access to middle-class jobs. Those jobs are simply not available in poor communities and the poor can’t afford to move to where the good jobs are. Instead you have the spectacle of a Detroit man who spends all his non-working hours getting to and from his minimum wage suburban job.

Finally, you have Republican leaders like John Boehner suggesting that the riots in Baltimore are evidence of the “50 years of failed Democrat policies”. While it is clear that he is reaching back to the Great Society, half of those 50 years Republicans were in the White House. So if policies are to blame, that blame should be shared equally by Republicans and Democrats.

The numbers again come to our rescue here. In this case, Paul Krugman.

Federal spending on means-tested programs other than Medicaid has fluctuated between 1 and 2 percent of G.D.P. for decades, going up in recessions and down in recoveries. That’s not a lot of money — it’s far less than other advanced countries spend — and not all of it goes to families below the poverty line.

Despite this, measures that correct well-known flaws in the statistics show that we have made some real progress against poverty. And we would make a lot more progress if we were even a fraction as generous toward the needy as we imagine ourselves to be.

In other words, the problem was not too much money. They problem was not enough money, and perhaps money spend on the wrong things.

So where does this leave us?

The “pathology” that has been the mainstay of Republican pronouncements about race and poverty from Ronald Reagan through John Boehner are not supported by the facts. Instead of dependency, we have predictable effects from job loss, mass incarceration, and economic disruption.

Instead of a post racial society, we have the daily experience of young black men who are targeted by the police and persecuted by the justice system.

Instead of confronting the realities of the living conditions that we have forced the poor to endure, conservatives use the myth of pathology to absolve society from taking meaningful action. The myths of the welfare queen, Willie Horton, middle class values, and personal responsibility allow us to ignore the fact that we have effectively walled off poor communities from prosperity.

Baltimore is a good example. It spent $130M over the last 20 years in an attempt to transform one of its poorest neighborhoods. While well intentioned, 1000 new affordable houses, new schools, and new clinics did not attract the employers necessary to support the families in those new houses. Without jobs, the neighborhood eventually reverted back to the same despair, crime, and drug abuse that every other job-poor neighborhood displays. Just fixing housing, schools, and healthcare, regardless of how much money is spent, isn’t enough.

“Having a well-maintained home doesn’t get at the larger issues that prevent self-sufficiency,” said DeLuca, the Hopkins sociologist. “The labor market and drug markets really destabilized Sandtown.”

The problem is institutional racism reflected in over-zealous law enforcement and lack of opportunity in the only neighborhoods that poor black people can afford to live.

The solution is jobs.

The rest is just myth and the conservative pathology of confirmation bias born of moral fundamentalism.