(What’s Left of) Our Economy: When Industries Disappear

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apparel, big government, Breitbart.com, conservatves, embroidery, Frances Martel, Immigration, labor unions, manufacturing, New Jersey, skills, textiles, Union City, unions, {What's Left of) Our Economy

Until I read Frances Martel’s “Hanging by a Thread,” I used to think of Union City as little more than one of those bleak-looking smallish northern New Jersey municipalities the Amtrak trains pass through on their way between New York City and points south.  How wrong I was!  And for such wide-ranging policy and political reasons!  

Not that you can’t simply enjoy her long feature for Breitbart.com for the fascinating descriptions of what makes her hometown special geologically (e.g., it sits on lots of Manhattan bedrock-like granite, good for supporting factories with heavy machines and multistory housing) and demographically (because it developed fairly late in the 19^th century, its population was always dominated by immigrants).

Clearly important as well is Martel’s main theme – how manufacturing built solid prosperity for Union City from the get-go, and how its demise, due to developments like (but not restricted to) offshoring-obsessed U.S. trade policies helped bring punishingly hard times. (Full disclosure: Martel interviewed me for the article, and quoted me quite generously.)

But if you’re thinking this is only an article for trade and/or manufacturing mavens, or for New Jersey history aficionadoes, you’re sorely mistaken. For along the way, “Hanging by a Thread” offers important insights into how these closely related subjects profoundly affect many of the nation’s other major issues and challenges.

For example, Martel offers a novel twist on the notion that the United States welcomed so many immigrants so consistently (though not always) from the mid-19^th century onwards in particular because of its urgent need for unskilled labor. No doubt most of the newcomers were poorly educated. But as “Hanging” makes clear, industry during this period used lots of complicated machinery, including the embroidery sector that became concentrated in Union City.

As Union City’s official historian told Martel, many of its first immigrants came from Germany, Switzerland, Austria, and other parts of Europe with major textile industries, and brought with them extensive experience working with such devices that employers clearly found valuable.

Since skills (of different kinds, of course) remain so crucial to economic success today, Union City’s past raises the question of whether – as Open Borders advocates seem to believe – the United States today should indiscriminately welcome immigrants regardless of skill levels and gainful employability.

Two other messages coming through loud and clear from Martel’s research and analysis are especially important for conservatives to heed. The first has to do with unions. Martel’s parents were hard-line anti-communists who fled Castro’s Cuba, and her mother worked in apparel. The author explains that these arrangements were seen as “a critical part of the factory ecosystem.” The following exchange, with her mother speaking first, makes the point vividly:

“‘I have always had a good union. It works, I think. It works to have a union because without a union, in a private place, you’re screwed,’ she told me.

“‘You don’t feel that there is a conflict between that and being a capitalist?’” I asked…..

“‘No. What? Being a capitalist? No,’ she replied, with confusion. ‘No, that has nothing to do with socialism, it’s just so that the worker has someone to defend them. If you don’t have a job, they can fire you whenever. That’s not fair. To throw you out for no reason, it’s unfair ifyou are working well.’”

Martel’s second message for conservatives actually echoes a point I’ve made before (e.g., here): The more enthusiastically traditional free trade policies are pursued by American leaders, the bigger government’s going to get. But as Martel makes clear, these approaches to the global economy are bound to generate needs that far exceed the kinds of welfare state benefits (ranging from income support to heavily subsidized healthcare) used to keep living standards above third world levels (or at least try to do so).

As the Union City example shows, relentless globalization can also turbocharge government’s role in economic development itself. The author explains that, since 2000, Union City Mayor Bob Stack (a big-city machine politician if ever there was one)

“took the reins on the eve of the guillotine falling on embroidery and has taken to meticulously rebuilding the identity of the city. He tore down Roosevelt Stadium, the sports venue at the heart of the city, to build a new Union City High School – with a stadium on the roof. Union City previously boasted two high schools, one for Union Hill and one for West Hoboken, that Stack turned into middle schools. He built parks in honor of the city’s Cuban, Colombian, and Dominican populations, and an ‘International Park.’ Seemingly every other street has a water park open in the summer for children to play in – the biggest, Firefighters’ Memorial Park, boasts an Olympic-sized swimming pool. His administration also refurbished the downtown library into the Musto Cultural Center and built its replacement, the library at José Martí Middle School (which his administration also built), in the shadow of what was once St. Michael’s monastery, an imposing Catholic historic site that now houses a Korean Presbyterian congregation.”

In other words, Union City realistically recognized the choices before it, and rejected “the option much of the Rust Belt took: do nothing, abandon ship, hope the invisible hand swoops in before you hit the concrete.” As a result (and also because of its proximity to New York City), it’s more than avoided the ghost town fates of counterparts like Gary, Indiana, Youngstown, Ohio, and Detroit, Michigan.

(What’s Left of) Our Economy: A Pundit’s China Policy Delusions

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2016 election, artificial intelligence, big government, China, Holman Jenkins, incomes, Jobs, Jr., national security, offshoring, tech transfer, The Wall Street Journal, Trade, Trump, Welfare State, {What's Left of) Our Economy

Holman Jenkins, Jr. did make one important and useful point in his Wall Street Journal column yesterday on U.S.-China trade policy (which puts him far ahead of most of the punditocracy): He’s absolutely right to call on President Trump to “lay out for the American people just how thoroughly [he] intends to shake up the hugely important U.S.-China economic relationship.”

For weeks, I’ve offered Mr. Trump exactly the same advice – to explain his China end game comprehensively to the American people in a prime-time Oval Office address (though unlike the free trade-obsessed Jenkins, I believe such a speech would boost public support for the Trump China agenda by describing the compelling long-term stakes of what I view as an effort to disengage economically from the PRC – and why they’re more than worth short-term sacrifices).

As for the rest of his column? It’s useful only for reminding Americans how internally contradictory and dangerous (not to mention downright ditzy) the case remains for retaining most of the pre-Trump China policy status quo. Just a few key examples:

>Jenkins insists that rather than pursue a “shakeup” that would amount to “following [Chinese leader] Xi Jinping down the path of seeking foreign scapegoats for failure and heavy-handed intervention at home,” the United States should be “building up our military and alliances.”

But what would be the point of sending more troops and equipment to East Asia while Washington returned to trade policies that have transferred literally trillions of dollars to the Chinese state and helped fuel a rapid military buildup, and investment policies that have ignored the massive export of advanced defense-related knowhow to Chinese entities, and for too long overlooked Chinese acquisitions of similar assets in the American economy?

>According to Jenkins, “China’s avid pursuit of artificial intelligence” shouldn’t worry Western experts because it’s “likely to be employed mainly in destroying the creativity and initiative of its own people.” But capabilities even remotely that massive won’t threaten any major U.S. strategic interests?

>In Jenkins’ view, central to strengthening the U.S. economy sufficiently to meet the Chinese threats he doesn’t laugh off is “dealing with the fiscal challenge of our welfare state.” But good luck with the politics of shrinking social safety nets under an American approach to globalization that kept sending valuable opportunities to earn middle- and even living-wage working- class incomes to China and other penny-wage and regulation-free production and export platforms.

Jenkins isn’t entirely wrong in his overall conclusion that “American prosperity is still made at home.” But the impact of purely domestic reforms is bound to be seriously diluted after decades of Jenkins and his crowd at the Journal (along with most of the rest of the nation’s punditocracy, the pre-Trump Republican party, and the Clinton-ite Democrats) focusing like laser beams on building a truly globalized economy.

And finally – about that headline calling for a “vote on a China Cold War”  (even though the article’s body only glancingly mentions the point): During his successful White House run, President Trump made no secret of his determination to overhaul America’s China trade policy. From the standpoint of democratic legitimacy, the Trump 2016 election victory was all the mandate his administration’s China policy measures need.

Im-Politic: Want to Really Fuel Big Government? Ditch Trump’s Trade Policies

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Affordable Care Act, big government, budget cuts, Congress, conservatives, discretionary spending, entitlement spending, healthcare, Im-Politic, industrial policy, Mick Mulvaney, Obamacare, Republicans, Trade, Trump, USAToday

USA Today‘s editorial yesterday on U.S. trade policy did an excellent job of stating a major objection to tariffs and other measures that interfere with international commerce – and one that understandably resonates strongly in a nation that prizes free market values, and especially among its conservatives: These trade curbs fuel Big Government, thereby preventing the economy from achieving its full potential, and harming the nation’s society and culture as well as the economy by sapping the attractiveness of individual initiative.

The essay also understandably focused on a development that looks like a poster child for trade-fostered Big Government – the process set up by the Trump administration to decide which companies will receive exemptions from recent metals tariffs, based on claims that adequate domestic substitute steel and aluminum products aren’t available.

In the words of the editorial writers:

“[T]he administration has imposed a new tax on imported metals and then put itself in a position to decide who has to pay it and who does not.

“This is Big Government at its worst — arbitrary and capricious, if not outright political, as it picks winners and losers in business. And all this is being done without any new law being passed and while a Republican Congress, which used to stand for free enterprise and limited government, remains supine.”

One obvious rejoinder is the observation that, however cumbersome the exemptions process may or may not be, Washington actually has an impressive historical record of “picking winners and losers in business.” Examples include the information technology hardware and software industries, which were practically launched with public (largely Pentagon sponsored) research and development funds, and critically nurtured by government (again, largely defense-supplied) markets; the world-class farming sector fostered by U.S. Department of Agriculture research findings; the equally world-class pharmaceutical industry aided by the National Institutes of Health; and an aviation and aerospace industry supported by the Defense Department, by the National Aeronautics and Space Administration, and by a NASA predecessor aeronautic agency. (For an excellent summary of this historical record, see this study from the National Academies of Science.) 

But there’s another vital point missed by USAToday and by conservatives who remain devoted to preserving or renewing the expansion of the existing free trade realm: If they succeed, they’re likely to see the kind of Big Government metastasis America has never experienced before. The reason? So many renumerative Americans jobs will be lost, and so much income destroyed, that political pressures for a much more generous welfare state will positively skyrocket.

Another favorite cause of newspaper editorialists like the USAToday writers and many Big Government-phobic conservatives – the return of mass immigration – will bring the same type of outcome, for many of the same reasons.

And if you think that the nation’s leaders will unite to uphold the causes of self-reliance and much smaller government, you weren’t paying attention to the recent fight over abolishing “Obamacare.” For better or worse, the national healthcare system created at the initiative of the former President remains largely in place even though its Republican opponents control the entire federal government and a huge majority of state governments because lots of these Republican politicians recognized that eliminating this latest entitlement would be political suicide.

At the same time, standard-issue conservatives aren’t the only Americans who may need to learn these lessons. Donald Trump belongs on this list, too. Interestingly, he won the presidency after running a campaign that both promised an Americans-First overhaul of trade policy and to protect the nation’s immense middle class entitlement programs – both of which clashed strongly with conservative dogma.

But his biggest first-year push as President involved going after Obamacare – well before he had achieved any of his trade policy goals, and before he even began pursuing them energetically. And he’s so far permitted his budget director, former Tea Party stalwart Mick Mulvaney, to propose numerous deep cuts in discretionary spending and even some entitlement spending that aren’t exactly middle class-friendly, either.

This set of priorities may have been unavoidable politically, reflecting Mr. Trump’s perceived need to establish some conservative bona fides with Congressional Republicans – who mainly still strongly support the party’s old orthodoxy, but whose staunch backing he would need in any impeachment proceedings.

At the same time, a fair number of those donors-friendly, offshoring-happy Congressional Republicans are retiring – largely because they recognize that Trump-ian trade and other unorthodox policies have won over the base. And although Democratic hardliners may indeed push successfully for impeachment proceedings if the party wins the House, it’s likely that, in the absence of a major smoking gun, this campaign could alienate independent voters – who are hardly gung ho to give Mr. Trump the heave-ho. Chances are they’d be even less receptive to an impeachment spectacle dominating Washington if the President distanced himself from meat-axe public spending cuts.

If this scenario unfolds, the loudest voices complaining that Trump-ian trade policies lead to Big Government could be mainstream media editorialists and pundits. But these voices would be less important than ever.

Im-Politic: The Meaning of Trump-ism

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2016 election, Andrew Jackson, Barry Goldwater, big government, Donald Trump, establishment, Franklin Roosevelt, free trade, Hillary Clinton, Im-Politic, Immigration, internationalism, Jacksonian Democracy, Mainstream Media, middle class, New Deal, Open Borders, Populism, presidential debate, protectionism, Ronald Reagan, Sun Belt, working class

On the eve of what could be an historically transformational debate for American politics, I’m still struck by (a) how mysterious to the nation’s chattering classes Donald Trump’s appeal to so many Main Street Americans remains; and (b) how vividly the elites’ befuddlement at – and clear disdain for – the maverick Republican presidential nominee keeps signalling their (witting or unwitting) cluelessness about life outside their increasingly chichi urban bubbles.

First, though, I’m serious about the importance of tonight’s debate between Trump and his Democratic counterpart, Hillary Clinton. His insurgency against an entire, bipartisan national political power structure may be no more sweeping than Ross Perot’s in 1992. But having captured one of the two major parties, he faces none of the so-far insuperable institutional obstacles encountered by third party candidates in presidential politics. As a result, Trump’s odds of victory in November seem solid, and it’s at least arguable that this event would produce the greatest shock to America’s political culture since the Jacksonian revolution of the 1820s.

Of course, American political history has been dotted with other strong candidates for the mantle of revolution (at least by the nation’s admittedly moderate standards). Ronald Reagan originally came from Hollywood, and promised to kill off the post-New Deal model of mixed capitalism that even a critical mass of Republicans had embraced since the Eisenhower era. But Reagan was strongly backed not only by big segments of middle- and working-class Americans who felt neglected, and on the tax front, even exploited, by Big Government politicians. He would never had made the White House had he not also championed a counter-business establishment that had risen outside the Northeast, and especially in a Sun Belt region that styled itself as the embodiment of traditional American rugged individualism.

Moreover, although Reagan also promised a much harder line in foreign policy, in crucial respects his worldview and proposals still fell within the bounds of the strategic ideology that had prevailed in America since Pearl Harbor – which has been dubbed internationalism. Though much more confrontational than his immediate predecessors, Reagan still bought the notion that America’s vital interests still spanned the globe, and the related assumption that active U.S. engagement of some form in even the remotest countries and regions was essential.

Barry Goldwater had run on a similar insurgent platform in 1964, but lost in a landslide – though his nomination victory over that Republican establishment of that era clearly paved the way for Reagan’s far more complete and lasting triumph.

Policy-wise, a strong case can be made that Franklin Roosevelt’s New Deal was more of a break with the past than practically anything Trump has proposed. Nor was New Deal innovation restricted to the domestic economy, as its pursuit of trade liberalization reversed a protectionist approach that had reigned in America for most of its history since the founding. In political, social, and cultural terms, Roosevelt’s triumph in 1932 revealed that eastern ethnic cities and their worldviews had supplanted those of small midwestern towns and rural communities. In many cases, moreover, the New Dealers themselves were something fundamentally new – especially the academics. But in an ironically Reaganesque way, they were less outsiders than representatives of an emerging counter-establishment.

As personally flamboyant as he was, Theodore Roosevelt was an establishmentarian at heart as well. In fact, one of his most important – and underappreciated – contributions to American politics was encouraging his upper class patrician peers to stop looking down their noses at public life, take an active role in politics, and make sure that noblesse oblige steered the nation’s course as opposed to the petty concerns of Democratic machine politicians and the ferocious greed of the nouveaux riches Captains of Industry.

So I really do think that you need to go back to Old Hickory to find an American politician who explicitly stood for the rabble and actually won the White House. Will Trump actually follow through with a populist agenda ? I know how many skeptics continue insisting that Trump’s only interest is further lining his own pockets and those of the Wall Street-ers he’s chosen as economic advisers. Since I’m not clairvoyant, I don’t feel confident in voicing an opinion either way. But interestingly, much of the rest of Wall Street doesn’t seem to agree. Nor does Big Business. Further, would Trump excite such vehement opposition from the nation’s offshoring- and Open Borders-happy Mainstream Media and bipartisan policy establishments if he was simply a crook? Their reactions to Trump’s views on national security don’t seem exactly blasé, either.

Which brings us to the combination of bafflement and outrage voiced ceaselessly by these elites regarding Trump’s appeal – which has brought him to within striking distance of the White House. I don’t claim to have all the answers on this score, but here’s one consideration that establishment Never-Trump-ers not only haven’t thought of but seem incapable of appreciating: Their charges of Trump bullying and even Trump business scamming are failing and even backfiring for the same reason that their charges of Trump’s working the system as relentlessly as any other special interest have met the same fate.

Simply put, when many of his supporters hear these indictments, they’re not thinking about whatever rudeness or prejudice or even indecency the relevant remarks allegedly reveal. Just as Trump’s lobbying apparently has prompted hopes that, “Finally! Someone’s going to work the system for me!” the moral turpitude charges suggest “Finally! Someone’s going to be my bully! Someone’s going to be a con man on my behalf!”

And though these aspirations sound odious themselves, it’s revealing – and in my view encouraging – that the two likeliest issue candidates for this Trump approach seem to be trade and immigration. After all, they concern international relations, where for all the talk issuing from the establishment about the importance of and need for norms and rules, power and skill in its use is the paramount currency, and will remain so for the foreseeable future.

Nonetheless, as has been true throughout his campaign, this source of Trump strength has been a persistent Trump weakness – or perhaps more accurately, a foregone opportunity. For as I have long maintained, with just a little more precision, these points could be made every bit as powerfully without slurs directed at largely blameless parties (e.g., illegal immigrants, moderate Muslims), or understandably perceived in this way, and without vulgar sexism (against, e.g., his Republican primary rival Carly Fiorina, or Fox News anchor Megyn Kelly, or even Clinton for taking a lavatory break). Hard-core Trump-ers would have been just as enthusiastic, and many fewer independents turned off.

All the same, since Trump has essentially pulled even in the race, since not trivial amounts of voters remained undecided, and since big turnout questions dog Clinton in particular, his foregone opportunity has not been completely lost. Will he begin seizing it starting tonight?

(What’s Left of) Our Economy: Greek Lessons

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an economy built to last, big government, bubbles, business spending, Eurozone, Financial Crisis, GDP, Greece, gross domestic product, growth, housing, personal consumption, {What's Left of) Our Economy

RealityChek’s more discerning readers might recall that I spend a fair amount of time commenting on the quality of America’s growth and the makeup of its economy. The idea is that, although economic growth is economically good, all else equal, the way the economy grows is crucially important, and that it needs to result in a healthy balance between production and consumption. That lesson (should have been) brutally brought home for Americans by the financial crisis – which was preceded by several years of quasi-respectable but very low-quality growth. More specifically, that expansion was led by interlocking housing, borrowing, and personal spending booms, which lacked the underpinning of adequate output and income growth.

These days, the battered population of Greece is getting an even harsher tutorial on the imperatives of high quality growth and an “economy built to last.” But judging from the political tumult shaking the nation in recent days in particular, there’s little evidence that its population or leaders – or its creditors and the rest of the global economic policy – understands the message. 

The available economic data for Greece aren’t exactly the same as those I use to show the quality of America’s economic structure and growth, and they don’t cover all the bubble years, but they’re still awfully suggestive. In particular, they illustrate how during the global bubble decade, Greece’s economy and growth, too, were dominated by household spending, along with a lots of Big Government.

There’s no doubt that, viewed from 30,000 feet, Greece enjoyed banner years from 2000 to 2007. In inflation-adjusted its gross domestic product rose by 4.0, 3.7, 3.2, 6.6, 5.0, 0.9, 5.8, and 3.5% – much better than the performance of the rest of the Eurozone. Statistics from the Organization for Economic Cooperation and Development (OECD), however, indicate that throughout this period, Greece’s economy was incredibly household- and government spending-heavy.

According to the OECD, a grouping of high income countries, in 2006 and 2007 (the earliest available data years), household spending made up 56.33 percent and 54.99 percent of Greece’s gross domestic product. For those years, the averages for the Eurozone were 29.59 percent and 29.44 percent – a little over half of Greece’s levels. In 2006 and 2007, government spending comprised 17.87 percent and 16.66 percent of Greece’s economy. For the rest of the Eurozone, the figures were 13.97 percent and 14.04 percent. And whereas Greece’s corporate spending represented 25.8 percent and 28.4 percent of its GDP, the comparable Eurozone numbers were more than twice as great – 56.4 percent and 56.5 percent.

As numerous analysts have (correctly) noted, the United States isn’t Greece. Most important, Americans and their government can borrow in their own currency, and have substantial control over their financial fate. Yet even so, the U.S. economy has suffered painful and wrenching change since the financial crisis broke out roughly eight years ago, and the damage inflicted by that near-catastrophe is by no means completely fixed.

In other words, because the United States spent its first nearly 200 years generally managing its economy responsibly, it enjoys the wealth and creditworthiness that can long protect it from Greece-style tragedies. But even if a climactic Day of Reckoning never comes, America’s poor quality growth and subpar economic structure appears to have pushed it into a stretch of secular stagnation that should worry everyone.

Im-Politic: Obama’s Dubious “Trust Me” Strategy on Iran and Trade

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2016 elections, big government, credibility, Im-Politic, infrastructure, Iran, minimum wage, nuclear deal, Obama, progressives, TPP, Trade

Two pieces of evidence do not a trend make, but when we’re talking about the Presidency of the United States, whose occupants usually choose their words with the greatest care even when they’re not as eloquent as Barack Obama, chances are something noteworthy is going on. So it’s more than a little troubling that the president has twice this month taken to defending a major, highly debatable policy with an argument that adds up to little more an unusually non-credible version of “Trust me.”

Not that trust doesn’t have its place in politics, but in the two cases I’m thinking of, Mr. Obama’s chops simply aren’t that impressive. His latest use of this tack concerns the Iran nuclear weapons deal. In an interview last week with Atlantic correspondent Jeffrey Goldberg, the president responded to critics of his strategy to deny Tehran The Bomb by declaring, “Look, 20 years from now, I’m still going to be around, God willing. If Iran has a nuclear weapon, it’s my name on this. I think it’s fair to say that in addition to our profound national-security interests, I have a personal interest in locking this down.”

You don’t need to be an Obama-hater to eye-roll this claim of ownership. After all, it’s not as if Mr. Obama entered office with immense foreign policy street cred – or with much foreign policy experience at all. And with a handful of exceptions like Leon Panetta (his former intelligence and Pentagon chief) and Robert M. Gates (who ran the Pentagon), his foreign policy advisors could fairly be dismissed as a “Team of Lightweights” if they were the subject of a Doris Kearns Goodwin history. Further, given the comfy retirements of recent masters of U.S. policy disaster ranging from former Fed chair Alan Greenspan to former Vice President Dick Cheney, it’s a safe bet that not only will the president live long and prosper in retirement whatever happens in the Middle East. He’ll also attract a legion of apologists to plead his case.

Mr. Obama has a stronger claim to credibility when he tries to reassure progressives that his trade agenda won’t harm working Americans or social, environmental, financial, and other regulations by citing his administration’s record – and his prior public service. Remarks like the following ring true: 

“If there was a trade agreement that undercut working families, I wouldn’t sign it.  The Chamber of Commerce didn’t elect me twice — working folks did.  I ran for office in the first place to expand the all-American idea of opportunity — no matter where you come from, what you look like, how you started out, who you love, you can make it if you try here in America.

“I don’t forget where I came from.  I don’t forget how I started.  I moved to Chicago in my early 20s with barely anything except a desire to make a difference.  I wanted to make sure my life attached itself to giving people a chance at opportunity — helping kids get a great education, helping parents who live in poverty get decent jobs that let them raise a family, help folks who work hard all day get health insurance so they don’t have to go to the emergency room when they get sick. So I became an organizer….” 

At the same time, precisely this type of combination of policies has “made sense” to broad swathes of American liberalism for literally decades. In fact, a hallmark of this movement during the early post-World War II decades (unions excepted of course) was (a) strong backing for trade liberalization and expansion; (b) equally strong backing for a greatly expanded role for government in propping up incomes and regulating business; and (c) robust (and needed) infrastructure building. Moreover, into the 21^st century, many Democrats, especially of the Clinton-ian persuasion, have felt completely confident that whatever harm is done to working class Americans by trade liberalization can be offset by better schools, yet more infrastructure building and other public investments and, increasingly, more aggressive income support along the lines of higher government-mandated minimum wages and more generous, family-oriented benefits.

Nonetheless, it’s also eminently arguable that precisely this combination of policies – and its belief that ever more public sector programs and requirements can indefinitely substitute for the loss of income-earning opportunities generated by market forces – ultimately keeps draining the productive life from the U.S. economy and hooking it on debt-fueled growth.

So far, though, a critical mass of Democrats so far is refusing to trust the president on trade issues – which is why it’s in such deep trouble in the House of Representatives, where the decisive vote on Mr. Obama’s trade agenda will be cast. And trust in the Obama Iran policies is hardly universal in his own party as well. Which suggests, encouragingly, that Americans are starting to demand that their leaders earn their trust – and that such healthy skepticism might even be applied to the upcoming presidential election.

Im-Politic: A Flawed Guide to Modern Populism

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big government, boardroom liberalism, conservatives, Democrats, elites, free trade agreements, Hillary Clinton, Im-Politic, Immigration, Mainstream Media, middle class, Noam Scheiber, One Percent, Populism, Republicans, Trade, working class

This morning’s Washington Post article on the new-found popularity in American politics of the label “populism” makes a crucial point:  The term is becoming so widespread among so many different kinds of politicians that it’s threatening to become meaningless. After all, if everyone is a populist, can anyone really be?

At the same time, it’s pretty stunning how many more legitimate reasons for populism’s proliferation have been missed by author David Greenberg, a Rutgers University historian.

Chiefly, the author expresses thinly veiled contempt for Republican leaders who have adopted the populist mantle. “Its promiscuous application [nowadays],” he writes, “has usually meant forgetting and forsaking key parts of the original Populists’ agenda. This year’s Republican candidates — an assortment of senators, governors, a surgeon, a CEO — may rail against Washington and claim to fight for the little guy, but in most cases, their view of government’s role in economic life couldn’t be more starkly opposed to the Populists’ ideals.

Yet Greenberg overlooks the fact that since the late-19^th century heyday of the original Populists, an impressive level of prosperity has become so widespread that a leading national economic challenge today is preserving a middle class worthy of the name, not creating one in the first place. One main reason is that “government’s role in economic life” has ballooned so dramatically. As a result, however, the defining characteristic of populism can no longer simply be support for yet more government spending.

Just as important, government’s immense scale – and consequent intrusiveness – combined with growing affluence, partly explains why conservatives who rail against this role do have some valid claim to populism. It also explains why this message resonates so powerfully among so many Americans who have not amassed fortunes of any size, and who believe that their lives – and their hopes for their children – have become more economically and financially fragile.

In addition, populism today is arguably broader than the big government-smaller government debate because two major sources of middle and working class economic anxiety – job-killing trade deals and immigration policies – are at best tangential to Greenberg’s framework.

To be sure, the author takes some Democrats and liberals to task as well for faux populism. But here his critique emphasizes style, not substance. Writing of Hillary Clinton, for example, he argues that because “symbolism matters in politics,” although she “can fairly claim to have voiced the concerns of those lower on the economic ladder, her years in establishment circles have made it hard for her to denounce a rigged system with the fire-and-brimstone zeal that the populist label suggests.”   

So Greenberg’s bottom line appears to be that a true populist today must not only stand for big government, but mainly champion society’s poorest. On the substance, this position is certainly defensible. But it’s an odd form of populism that doesn’t speak to the leading – and entirely valid – concerns expressed by a large demographic majority. Indeed, many prominent Democrats ,who worry about their party’s recent difficulties in winning middle and working class votes, will probably find populism a la Greenberg pretty deficient too.  

Moreover, the author’s priorities indicate that he’s mistaking populism for what is actually a phenomenon that New York Times reporter Noam Scheiber has brilliantly identified as “Boardroom Liberalism.”

As Scheiber wrote in a New Republic article last year, this political outlook is “a worldview that’s steeped in social progressivism, in the values of tolerance and diversity. It takes as a given that government has a role to play in building infrastructure, regulating business, training workers, smoothing out the boom-bust cycles of the economy, providing for the poor and disadvantaged. But it is a view from on high—one that presumes a dominant role for large institutions like corporations and a wisdom on the part of elites. It believes that the world works best when these elites use their power magnanimously, not when they’re forced to share it. The picture of the boardroom liberal is a corporate CEO handing a refrigerator-sized check to the head of a charity at a celebrity golf tournament. All the better if they’re surrounded by minority children and struggling moms.”

I explained here why this approach of throwing a continuing and even growing stream of crumbs to the poor is as looney on the merits as it looks politically cynical. Too bad Greenberg doesn’t seem to have read Scheiber before submitting his draft to the Post. Going forward, I’d suggest that he, and others, use these tests of populism instead: Who’s really getting the one percent’s goat? Who’s viewed as a genuine danger to its power and privilege? Because you can bet that the powers-that-be – which of course includes the Washington Post and the rest of America’s media elite – are too smart to waste their time trashing, ridiculing, and otherwise trying to marginalize phony populists.

Im-Politic: When Polls are Poles Apart

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2016 elections, big government, Gallup, illegal immigration, Im-Politic, Iraq, ISIS, national security, polls, public opinion, race relations, Republicans, terrorism

With the 2016 presidential election (too) rapidly approaching, opinion polls will be attracting even more attention than usual over the next year and a half. Yet if two recent Gallup surveys are any indication, many are likely to confuse more politicians and voters than they inform.

On the one hand, yesterday Gallup published the results of its latest annual sounding on “Americans’ level of concern about national problems.” The main findings, according to Gallup: The nation’s worries about terrorism and race relations are up sharply over early 2014 levels. Fifty-one percent of Americans said they “worried a great deal” about the possibility of a terror attack – compared with 39 percent in 2014. Twenty-eight percent gave a similar response about race relations, versus only 17 percent last year. And comparable concern about illegal immigration increased from 33 percent to 39 percent. You can see how a wide range of other issues polled at this link.

Given the rise of ISIS, police shootings of unarmed young black men in places like Ferguson, Missouri and New York City, and the uproar over Central American minors flooding the U.S. southern border, the above results are perfectly understandable.

On the other hand, they seem to contrast strikingly with the findings of a Gallup survey from the week before focusing on the “most important problem” Americans believe face the nation. Only six percent so identified “the situation in Iraq/ISIS;” only six percent tabbed “terrorism;” and “foreign policy” and “national security” garnered only four percent each.

Was there a closer correlation between the two polls on race relations and immigration? Absolutely not. Race also ranked as the leading national problem for only four percent of respondents, while “immigration/illegal aliens” was cited by only seven percent. You can see the full results at this link.

When I read the top problems results, I immediately thought that they spelled especially bad news for Republicans, many of whom hope and expect foreign policy issues to play a much bigger role in Election 2016 than they usually do in American politics. Nor did emphasizing immigration and border security issues seem especially promising based on these results. At the same time, public opinion seemed to break pretty strongly for Republicans on one important front – “Dissatisfaction with government” was the leading vote-getter in this poll, with 18 percent calling it the country’s number one problem.

But the “levels of concern” results just one week later sent almost exactly the opposite message for the two major parties.

Of course, office-seekers at all levels of government will be commissioning their own polls and reading countless others as they plot their strategies. And continually changing events could well affect the public’s stated priorities. But for the sake of at least minimally coherent campaigns and debates, I hope their collective message is a lot clearer than that sent by these two Gallup polls.

Our So-Called Foreign Policy: One of the Neocons’ Biggest Cons

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big government, neoconservatives, Obama, Our So-Called Foreign Policy

As long as Americans remember the Iraq blunders they fostered, neoconservatives and the foreign policy positions they champion aren’t likely to regain decisive influence any time soon. But they continue to mesmerize the nation’s mainstream media, which keep awarding them plum pundit-izing platforms and outsized amounts of space.

That’s why we all owe such a debt to former Wall Street Journal columnist George Melloan’s recent essay attacking President Obama’s foreign record these days. Melloan makes all the by-now-standard charges that the President’s hesitancy, and his supposed determination to pull America largely out of world affairs, have egged on aggressors throughout the Middle East and in Moscow. But he also unwittingly performs a major public by reminding the nation just how internally contradictory and historically whacko neoconservatism can be.

The biggest internal contradiction revealed in Melloan’s column in the (often neoconservative) Journal is of most immediate interest to conservatives. But it also valuably reminds all Americans of a crucial tradeoff between foreign policy and domestic policy that’s too often ignored. According to Melloan, a great lesson taught by the 20th century is that the greatest U.S. foreign policy and military successes owed overwhelmingly to the private sector, and that these vital capabilities are being destroyed “by the progressives who took control of the U.S. government in 2009.”

Not that Melloan or other neocons would ever slight the skill and power of the American military. But the idea that the U.S. economy somehow spontaneously turned its productive might into a gargantuan war machine is either shockingly ignorant or disgracefully deceptive. During World War II, it took a triumph of effective government – including not only crackerjack administrative and logistical expertise but strong support for the numerous technological innovations that were keys to victory.

Yes, many of these war-time government officials came from the private sector, where they developed their skills. But does anyone honestly think that they could have created the vaunted Arsenal of Democracy sitting in their offices on Wall Street or in corporate boardrooms? And P.S.: Stalin’s Russia possessed none of this private sector knowhow or tradition and built a pretty fair military itself.

Government’s role in maintaining the gargantuan peacetime defense establishment for which Melloan and other neocons clearly pine was so pervasive that no less than Dwight D. Eisenhower left office warning his countrymen about the power of a “military-industrial complex.” One key passage is worth spotlighting:

“This conjunction of an immense military establishment and a large arms industry is new in the American experience. The total influence — economic, political, even spiritual — is felt in every city, every State house, every office of the Federal government. We recognize the imperative need for this development. Yet we must not fail to comprehend its grave implications. Our toil, resources and livelihood are all involved; so is the very structure of our society.”

Yet even this description of government’s involvement in the military, and of its impact on the broader post-war economy, is a considerable under-statement. Just one example: Pentagon-funded research and deelopment not only created high tech weaponry. It also made possible, at least on a commercial scale, every American information technology industry you can think of – including the internet.

There’s also a strong argument that, once the New Deal emergency faded and the World War was won, America’s unprecedentedly enormous peacetime military indirectly helped fuel the rise of the permanent welfare state. It’s easy to see how it forced American politicians in both major parties to keep finding ways to persuade taxpayers that they were getting something for their money other than soldiers and weapons. It’s also easy to see why for so long these same politicians refused to choose between guns and butter when they faced budget crunches, and chose both – thereby setting the national debt on a high-growth path.

And this effect hasn’t just been seen since World War II. It’s long been recognized by American historians that the Civil War both established once and for all Washington’s supremacy over the states, and greatly expanded that federal government’s powers.

Such history should be so well known to a veteran commentator like the Journal’s Melloan that it’s hard to believe that he’s not trying to mislead – and that the fictional narrative he offers stems from the anti-government, free market zealotry propagated for so long by him, by the Journal editorial board, and by much of the American conservative movement. (Libertarians have been a major exception: Fear of its pattern of feeding government underlies much of their critique of foreign policy activism.) In other words, he seems to fear that if government gets its due for 20th century foreign policy successes, the rest of the anti-government case could collapse.

The crucial point here is not to defend either government spending as such or Obama’s alleged foreign policy restraint. Instead, it’s to remind not only neocons but others on the right of center in particular that they can’t have it both ways. If they want a more forceful foreign policy, they’re going to have to accept a much bigger government that reaches far more deeply into the civilian economy on an ongoing basis. If they want a much smaller government, they’ll never get it without scaling back their foreign policy ambitions. If, however, they want the nation stuck with the worst and most dangerous of all possible worlds, a highly active, globally engaged foreign policy and a shriveled public sector, they’ll try to rewrite history and wish the problem away– like George Melloan.