Monthly Archives: November 2016

The Impact Of Trump On The Economy

So now that Donald Trump has secured the Presidency (albeit despite continued attempts to wrest it from him via the Electoral College) the big question on everyone’s mind is, what about the economy? Despite an expansion getting long in the tooth and despite the likelihood that Trump will have a significant recession on his watch, the fact is that he could have a significantly positive impact on the U.S. economy.

Firstly, he seems to be indicating that he is serious about cutting regulation and reducing the number of civil servants. Those excited and/or fearful that the country is about to change are right to be so. In the postwar period, the federal regulatory state and the federal civil service have grown. Rather than restructure regulations to reflect a changing economy, regulations have been piled on regulations. If we were starting from scratch today, we would not design a regulatory state like the one we currently have. Also, the federal civil service has grown to administer the increasing amounts of regulation. The point is that government functions largely as it did in the 1950’s, whereas the private sector has had a couple of retoolings during that period. All of these regulations not only add to the cost of doing business and inhibit growth, but they foster industries designed to help the private sector manage through these regulations. These jobs are effectively non-economically productive jobs, thereby depriving the economy of productive workers. By dramatically reducing regulations and even shutting down some government departments, Trump can expand the productive capacity of the American economy.

Secondly, Trump is looking to decrease the corporate tax rate. While there is a case to be made that perhaps Trump will lower it too far, the fact is that the U.S. has one of the highest corporate tax rates in the industrialized world. Businesspeople have been complaining about this for many years. By lowering the tax rate, Trump can make the U.S. more competitive in attracting investment, and by extension, jobs.

Thirdly, international trade has been the one area where Trump has received most of his serious economic criticism. For those like myself who have been trained in neo-liberal theory, the idea of erecting trade barriers seems tailor made to reduce economic growth, possibly through the start of a trade war. The problem with the theory in the real world is that it assumes that people who are displaced in one industry can easily move over and be employed in another industry. At the time that theory was birthed in the first half of the 19th century, that was a reasonable assumption. A laborer with a strong back and average intelligence could be tasked with many of the jobs then available. However, today most jobs are highly specialized meaning that if you lose one, going into another industry means that you will likely have to start all over at the bottom and work your way up to a similar position. This is one of many reasons that while jobs have gone overseas, they have not been replaced by equal or better jobs. The trade agreements that have been signed over the last 30 years have taken away jobs (and lowered prices), but those jobs haven’t been replaced. By renegotiating the deals with an eye on obtaining a better deal for America’s workers, Trump can bring some jobs back to the U.S.

In short, Trump’s economic plans, might perhaps, help the U.S. economy in the long run. Whether it will help or not really depends on what regulations are eliminated, to what extent they are eliminated, and what the new trade deals look like. It is possible that these moves could leave the U.S. worse off, if they are not handled right. But if handled right, they could leave the U.S. even better off. We have been told over the last few years that a low growth world is the best that the U.S. can do, and that we had better just get used to it. A massive reduction in the corporate tax rate, a massive reduction in the regulatory state, and fair (rather than free) trade deals would remake the U.S. economic landscape. The impact on the U.S. economy, if these policies are implemented, could be huge.

America’s Transition And What It Means.

So, while Donald Trump is beginning to name people to his Cabinet, protests are ongoing and Trump Electors are reporting that they are being harassed and threatened to get them to change their vote in the Electoral College. Despite this, Washington and the elite seem to be preparing for a transition of power. While the handover may end up being peaceful (if protested), the fact is that America as we have known it has changed in ways that it is not clear that we fully appreciate and in ways that we were not even aware of until this election season. Some of the ways that this change is manifesting itself are as follows:

1.)    Trump Electors are being harassed to change their votes.

The system that we have had for over 200 years is being called into question because some people don’t like the result. While they may say that they are doing this because “Hillary won the popular vote and should be President”, it is doubtful that they would be taking this action if Trump won the popular vote but lost the Electoral College. The lack of condemnation from the media & Democrats means that they approve of what amounts to terrorist tactics to try and overturn the results of an election conducted under an Electoral College system. This attitude appears to indicate that at least the Left only accepts the legitimacy of a system if it produces the result they want (i.e. the ends justify the means). If this attempt were to succeed (assuming that the country survived geographically intact), one could expect these tactics to be used after each election, and from both sides. The country would be sliding towards a literal shooting war.

2.)    The traditional media has been revealed, in large part, as a partisan operation, and a vicious one at that.

While conservatives have been complaining about “media-bias” for decades, this election season revealed (thanks to Wikileaks) that the media is/was coordinating with Democrat campaigns. While people instinctively understood this as evidenced by the low esteem in which the media was generally held, I think some were shocked by the revelations which vindicated talk-radio’s hyperbolic description of the “Democrat Media”. In addition, some in the media, far from engaging in sober and reasoned analysis, are defaming all 60 million voters as deplorable people whose very vote for Trump forfeits their right to be treated humanely. Whatever chance there was for the media to play a role in bringing the country together is now gone forever, as is their credibility to effectively oppose the Trump Administration. Conservatives, centrists, and even some liberals of goodwill will be questioning reports of Trumpian excesses, even if the media complaints are wholly justified. Furthermore, the behavior of the old media and their attitude towards Trump supporter means that they have few willing to stand up for them if Trump decides to infringe on their First Amendment rights.

3.)    Universities may be a large waste of taxpayer dollars.

While it has long been known and well-documented by conservatives, centrists, and liberals of goodwill, the academy has been known to discriminate against conservatives and their views. On some campuses, it isn’t even physically safe to openly hold conservative opinions. However, the collective meltdown in academia with safe-spaces and safety pins and protests indicate that campus society has reached a terminal stage. That this reaction isn’t being laughed off of campus with jeers and suspensions means that many of our elite colleges have become little more than daycare centers and ideological incubators for one side. The lack of respect for the rights of others to think differently, as well as no longer being a place for people of all ideological stripes to come and try and persuade people with reasoned and dispassionate argument, means that the case for taxpayer funds going to universities is weakened. The social good of producing an elite that is well-versed in reasoned argumentation as well as respectful of the rights of other is not happening in America. Consequently, expect those on the right and center to be indifferent when university funding is cut and howls of protests start.

In conclusion, these three are but three examples that illustrate that the United States as we have known it is not long for this world. The reactions to Trump’s election, and their underlying causes, means that we have a large fraction of the population that simply doesn’t believe in the ideals of this country. They clearly don’t believe that the rules should be followed regardless of the outcome in any specific circumstance. They don’t really believe that the other side should have the right to have their votes respected (they can vote, as long as they don’t actually win). And many of them don’t believe that their opponents should even be granted humanity. This view appears to permeated the elite college campuses, and the media as well, institutions that should be standing up for the ideals, even if they don’t agree with a specific outcome.

A country cannot survive when its institutions and large fractions of its population won’t support the system if that system doesn’t give them everything that they want all the time. A country cannot survive when its institutions see the political opposition as inhuman and deserving of all of the abuse that they throw at it, especially when that ‘deplorable’ part of the population is roughly 50% of the country.

This is not to say that there won’t be another Presidential election in 4 years, but the fact is that we are likely to see the U.S. go the way of the Soviet Union within our lifetimes. That is to say, the U.S. will still exist (as does Russia), it will still be relevant on the world stage (as is Russia), but it will be geographically smaller than it is currently. That process will be unstable and will move markets. It will have negative economic effects and will not be conducive to growth and prosperity.

We are living in interesting times.

Why The Center-Left Lost The Election

So you consider yourself part of the center-left. You might even be a Republican who voted against Trump. You are highly-educated, well-traveled, and you can’t fathom how you can be looking at a Donald Trump Presidency. It is a complete shock to you. You are depressed. While you might console yourself that your fellow Americans are just hopelessly emotional, stupid, racist, homophobic, etc., the truth is that Donald Trump is the culmination of many factors, many of which you helped to create. In other words, if it hadn’t been Trump, it would have been someone else. If it hadn’t happened now, it would have happened later.

So what did you do that has brought us here?

1.)    Many of you, deep down, don’t think Republicans should have a right to pursue their agenda, and it shows.

The Republican Party has complete control (both houses of the state legislature + the governor’s mansion) in 24 states (and 2/3’s of all of the state legislatures). They have now, after the recent election, 33 governors. They have control over the Senate and the House of Representative, as well as 3 solidly conservative Supreme Court Justices. And yet you don’t really believe that Republicanism (whatever that may be) is a legitimate political philosophy. When you win elections, Republicans are supposed to fall in line and let you do the agenda that the American people voted for. Maybe they are allowed to offer some token resistance to your agenda, but they should eventually cave in to your demands if they are to be considered reasonable. When Republicans win elections, they are being unreasonable if they should actually govern like they mean it. There seems to be an expectation from many of you that the Republican legislators should betray their constituents and pursue a lighter version of your agenda. You don’t understand the Republican thought process and you can’t believe that anyone would take that agenda seriously.

2.)    Because you don’t understand it, you assume it must be driven by some sort of evil.

Many of you are not truly religious folks, but you do tend to frame much in moral terms. If one supports cutting taxes, they must be evil/racist. If one thinks that immigration laws should be enforced until changed by Congress, then one must be evil/racist. If one’s moral convictions dictate that there should be some restrictions on abortion, one must be evil/racist/anti-woman. If one holds a traditionalist view of marriage, one must be homophobic/evil/racist. If the U.S. really is as you appear to see it, then there would be many no-go zones for minorities, and these areas would be well-known. Gay people would know not to travel to certain areas for fear that they might be attacked or murdered. Many of you make it difficult to have an honest debate on issues with you, because you simply resort to name-calling, which shuts down discussion.

There really is an appropriate level of immigration in this country. There really is an appropriate amount of government spending. Not every government program is effective, and some should be shut down, etc. etc. There can be an honest discussion of these issues, but it can’t happen with people like you. Remember years ago when people accused you of not be patriotic because you didn’t support the war in Iraq? Remember how frustrating that was? You didn’t feel you could have an honest debate? That’s what you do to your opponents on issue after issue. And you take people who haven’t murdered anyone, they haven’t stolen anything, they haven’t committed any crime at all, and you make them out to be caricatures of idiots or Hitler.

3.)    And you don’t understand it, because you live in a solid, albeit high class, bubble every bit as thick as what you think conservatives do.

Imagine that you grew up in a liberal household, went to public school, on to an elite university, and now live in San Francisco, Los Angeles, New York, or any of several metro areas around the country. You watch the cool T.V. shows, see the cool comedians, and hang out with hip people. Chances are that you may never had your world view seriously called into question.

The same is not true for someone who grew up in a conservative household who has taken the same path I just described. There may be proportionally more atheists in the Vatican than center-right faculty on college campuses in this country. In other words, the popular culture, urban areas (as opposed to rural areas), and the education system are at odds with the center-right world view. Because the center-left world view is so dominant, it is highly more likely that a center-right person comes into contact with the left-wing world view than the opposite.

The result is that roughly one-half of the country (say Team R) has to come to terms personally with the other half of the country (say Team D), but Team D never has to personally come to terms with Team R.  

 4.)    Which means that you simply don’t come into contact with the “other side”, and don’t believe that the center-right should have any rights. And they have figured this out.

The fact is that Hillary Clinton’s description of Trump supporters as ‘deplorable’ and ‘irredeemable’ should have been roundly condemned by the major media outlets, but it wasn’t. In fact, much of the analysis was whether it was a wise thing to say, not that it was untrue. If you see people like this, you can’t possibly stand up to defend their rights when they are trampled. You, who would (rightly) scream from the rooftops over stereotypes of Muslims being terrorist sympathizers, are willing to stereotype, demean and condemn literally millions of people who you have never met. People who might not feel comfortable with same-sex marriage are to be put out of business (or told that they must violate their consciences) if they won’t provide services for gay weddings, because they are just awful people and awful people deserve to be punished. Pharmacists whose religious objections to contraception make it uncomfortable to sell it are told that they must do it, or else. Conservative groups can be harassed by the IRS and basically effectively denied participatory rights in the political process, and you are okay with that. The center-right has figured out that you don’t see them as full citizens.

5.)    And you really don’t care anyway that they are struggling economically.

Many of the regions that voted Trump are the economically depressed regions of the country, and they have been for some time. In these regions, America’s best days are behind it. Some on the center-left (Bernie Sanders) get this and have tried to craft a message to appeal to the economic angst of the American middle class. Apart from the ideological differences, many American rural conservatives appreciated Bernie because although they didn’t really agree with him on much, they sensed that he got it and that he didn’t view their struggles in a dismissive manner. Also, they sensed that he genuinely believed what he was saying. And then the Democrat Party went and appeared to rig the primary process against him. The American economy isn’t working for a huge swath of hard working people. Your candidate didn’t really seem to care, nor did you.

6.)    And because of all of this, you nominated a cold, corrupt, crooked, candidate, and dismissed the Republican as a misogynistic, racist buffoon.

But because you see any Republican as misogynistic (Mitt Romney’s War On Women), racist (George W. Bush failing to approve hate crimes legislation in Texas), or buffoonish (John McCain), the idea that you would have seen some other Republican as a reasonable alternative to Hillary Clinton is something that nobody believes anymore. Screaming that Donald Trump is a threat to the Republic when you have said the same thing about every Republican presidential candidate going back to at least Bob Dole, while also saying the same thing about Nixon and Reagan, has destroyed your credibility. It is not a stretch to say that while we don’t know what issues will be animating the country in 8 years, and  while we don’t have any idea who will be running for President, we can be reasonably sure that the Republican will be vilified by you as misogynistic, and/or racist, and/or buffoonish, even if that nominee is Condoleeza Rice.

In addition to the credibility problem (as strange as that sounds given that we are talking about Trump, after all), you also nominated someone who had ethical problems unlike anything anyone has seen before. Is the center-right really supposed to think that a center-right candidate with this baggage would have gotten a pass that you gave Hillary Clinton? Do you even believe that?

If you wonder how anyone could vote for Trump, remember that you didn’t nominate a JFK, a Ronald Reagan, or an FDR. You nominated Hillary Clinton. Or to put it another way, in the election between Hillary and Trump, they were each other’s best argument.

 

Conclusion:

So Mr. and Mrs. Center-Left, if you want to know why Donald J. Trump is President today, look in the mirror.

Let’s recap.

You have dismissed half of the country for a long time.

You haven’t thought for a long time that half of the country should have the same rights as you.

You don’t think accommodation should be made for their views.

You attack and mischaracterize their other non-Trump candidates.

You dismiss their struggles and their grievances.

You make honest debate impossible.

You don’t care to make an honest effort to try and see things from their perspective.

 And so they did what human beings tend to do in such situations: they threw a huge middle finger at you.

And the country will have to live with the results.

 

High Court Ruling Shows Elite Contempt And Intolerance Of Democracy

Earlier this week, a 3 judge panel in U.K. took it upon itself to attempt to overturn the votes of 17.5 Britons who voted in June to leave the European Union. While ostensibly making a ruling (which is being appealed) that says that only Parliament can begin the process of formally exiting the E.U., this appears to be an attempt to slow down the exit process, perhaps postponing it indefinitely.

This action, taken as it was by the elites, appears to be just the latest attempt to push forward with an E.U. project that was already suffering from a democratic deficit. Time and again over the last quarter century, the political class in various E.U. countries have sought to push the E.U. integration process forward, by hook or by crook. In cases where E.U. treaties have been rejected, the people have been “invited” to vote again on treaties that were at best, marginally revised. Or in other cases, the treaties haven’t been submitted for a vote at all due to fear that they would be rejected by the voters. In the case of the Lisbon treaty (effectively the E.U. constitution), the Irish were the only country to put the treaty to a popular vote, which they rejected. The abuse heaped on the Irish voters by the E.U. elite was stunning, and they were graciously given a “second opportunity” to “correct their mistake” (which they did).  

In the case of the Brexit vote, the governing class and elite opinion were all on one side. Brexit voters were abused and disparaged as racist idiots, even before the first votes were cast. After it was clear that the British had dared to vote the “wrong” way, the initial reaction in certain circles was to float ideas about ignoring the vote, to complain that it was invalid because the other side lied, or demanding another vote, or claiming that many people had changed their minds, etc. etc. The problem in Europe is that these tactics and attitudes only seem to cut one way. If the Brexit side had lost, it is highly questionable that there would have been calls for a re-vote.

What has been clear for quite some time is that elites in Europe (and even in the U.S.) don’t really believe in democracy as a system. The system that was taught to many of us in school was that the people vote for representatives and then those representatives decide. Or in the case of a referendum, the people vote and whatever gets the most votes wins. Now nobody says that the people will always get it right every time, but the idea is that they will in the majority of cases. And where they don’t, the system is flexible enough to allow them to change course over time. But what is not questioned is that the decision of an election (assuming that there was no fraud involved) should be hindered, frustrated, ignored, or overturned just because a class of people doesn’t like it, or that it massively inconveniences groups of people who have been powerful and have had things largely their own way up to that point.

It is the system I just described that the governing class of Europe in general and of the U.K. in particular have no use for. The system that they believe in is one where the people can vote, but that they (the governing class) has the right to question, declare illegitimate, frustrate and/or overturn decisions with which they fundamentally disagree. The system that they believe in (voting until you get the result that you want, putting hurdles in the way of executing the election decision in the hopes that you will derail it, etc) is the stuff of light dictatorships. The court’s attempt to force another vote, albeit in Parliament, does it no credit at all.  That it would do this calls into question whether the court can consider itself a legitimate part of a government that considers itself a democracy.