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(What’s Left of) Our Economy: The Times’ History of Free Trade is Bunk

15 Tuesday Mar 2016

Posted by Alan Tonelson in (What's Left of) Our Economy

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Adam Smith, Binyamin Appelbaum, Donald Trump, Douglas A. Irwin, economics, economists, free trade, I.M. Destler, Jagdish Bhagwati, John Maynard Keynes, John Stuart Mill, mercantilism, protectionism, Republicans, Richard Nixon, Robert Torrens, Ronald Reagan, Smoot-Hawley Tariff, strategic trade theory, tariffs, The New York Times, Trade, {What's Left of) Our Economy

It’s easy to imagine the thought processes responsible for The New York Times running last week’s article describing Donald Trump’s views on trade policy as “Breaking with 200 Years of Economic Orthodoxy”:

“We are the newspaper of record.”

“The public needs vital context to make intelligent decisions.”

“We can flaunt our matchless knowledge of history.”

What a shame, then, that economic correspondent Binyamin Appelbaum’s piece failed so badly on so many counts.

Let’s be charitable and start off by accentuating the positive. Appelbaum deserves credit for characterizing trade concerns as “among his oldest and steadiest public positions.” That’s a healthy corrective to media-wide reporting portraying the Republican presidential front-runner as motivated solely or mainly by – nativist and even racist – hostility to immigration.

It was also encouraging that Appelbaum acknowledged (though in an excessively narrow way, as will be demonstrated below) that “economists have oversold their case.” And he helpfully quoting a leading voice in the profession as noting not only that foreign protectionist practices are all too common, but that “It might be that the threat of tariffs or other trade sanctions could cause American trading partners to open up their markets or drop their barriers to trade.”

Unfortunately, nothing else Appelbaum wrote met standards of current or historic accuracy. First, although he correctly described mercantilism’s focus on amassing trade surpluses, he never pointed to a Trump statement endorsing such a goal. Conversely, the author errs when he contends that the orthodoxy calls for maximizing international trade flows. Instead, it calls for permitting global trade to reflect patterns of comparative advantage to the greatest extent possible.

As for Appelbaum’s brief history of American trade politics, it omits crucial facts. Specifically, he quotes as gospel the view of the University of Maryland’s I.M. Destler that “For most of the last century…skepticism about trade had been relegated to the fringes of the Republican Party.” But no significant Republican shift toward trade liberalization took place until after World War II. Indeed, legislators Reed Smoot and Willis Hawley, sponsors of the 1930 tariff, were both Republicans.

And even after most of the party warmed toward freer trade positions, major tariffs were imposed in 1971 by President Richard M. Nixon and throughout the 1980s by President Ronald Reagan – hardly fringe figures.

Finally, Appelbaum also seriously distorts the economics profession’s position on trade liberalization. Why, for example, didn’t he point out that, like one of the contemporary he cited, Adam Smith himself endorsed the threat and use of tariffs to open foreign markets. He also left out all the major loopholes in standard free trade theory pointed out by some of the biggest names in economic history. This history of the idea of free trade by Dartmouth’s Douglas A. Irwin makes clear how significant they have been. Here’s a summary drawn from my (New York Times) review of Irwin’s 1996 study – which unfortunately has not been digitized:

“Robert Torrens and John Stuart Mill explained how countries could use tariffs to enhance national wealth by stimulating the production of more profitable exports. Mill showed that tariffs protecting ‘infant’ industries could help them survive competition with more established rivals and eventually become self-supporting — without exacting larger costs from that country’s consumers or other economic sectors.

“During the 1920’s, Frank Graham of Princeton theorized that tariffs could provide permanent help for national economies by encouraging a shift from agriculture into manufacturing, thereby increasing a country’s total wealth. In the wake of the Great Depression, John Maynard Keynes insisted that free trade policies could impoverish individual countries during periods of already high unemployment, deflation and fixed exchange rates, particularly when the deflation was caused by a central bank’s determination to keep interest rates up. And in the 1980’s, a school of ”strategic trade” theorists contended that the special characteristics of certain industries (particularly those dominated by a few producers) could allow governments in some instances to use export subsidies to create national advantage.”

Irwin was correct in noting that “these arguments simply represent exceptions to a still-enthroned free trade rule — not new rules themselves (my paraphrase).” But it’s also true that these exceptions are so substantial that they call the theory’s validity into question.

In fact, Columbia University economist Jagdish Bhagwati, a leading free trade champion for decades, put it best when he observed, ”One cannot assert that free trade is ‘the policy that economic theory tells us is always right’ . . . certain developments make the case for free trade more robust whereas others make it less so . . . the latter are subject to many difficulties as one passes from the classroom to the corridors of policy making.”

I suppose that Appelbaum and The Times should be praised to trying to convey the idea that a high profile current campaign issue has deep roots in the past. But is it so unreasonable to hope that they could do the story anything close to justice?

Im-Politic: Cruz on Foreign Policy Could be Both a Lot Worse & Lot Better

06 Wednesday Jan 2016

Posted by Alan Tonelson in Im-Politic

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China, Cold War, conservatives, Cuba, democracy, Donald Trump, foreign direct investment, Im-Politic, interventionism, isolationism, John Quincy Adams, morality and foreign policy, nation-building, neoconservatives, Republicans, Ronald Reagan, Soviet Union, Ted Cruz

Difficult as it is to remember sometimes, there are still candidates vying for the Republican presidential nomination other than Donald Trump. For example, there’s Senator Ted Cruz, who in fact has established himself as the runner up in most national polls so far and the leader in Iowa, whose caucuses kick off Campaign 2016’s actual voting.

I’m no Cruz-an, but I’m grateful to economic and security commentator Nevin Gussack for calling my attention to an April interview given to The Daily Caller by the freshman legislator. It shows that Cruz has some sensible instincts when it comes to an overall American approach to world affairs, but that he has a lot to learn about China.

In other contexts, Cruz’ claim that he’s neither a  “full neocon” nor a “libertarian isolationist.” in his strategic leanings could legitimately be dismissed as cynical, Clintonian triangulation. Unfortunately, both American foreign policy and the commentary it’s generated have so typically tended to view the nation’s world role in terms of starkly and foolishly dichotomous choices (like “interventionism” versus “isolationism”) that Cruz’ apparent attempt to stake out a middle ground decidedly encouraging.

In fact, though he cited former President Ronald Reagan as a role model, Cruz actually sounded more like John Quincy Adams, who served not only as president himself but as Secretary of State. In 1821, he famously articulated this definition of the U.S. purpose in world affairs:

“Wherever the standard of freedom and Independence has been or shall be unfurled, there will [America’s] heart, her benedictions and her prayers be. But she goes not abroad, in search of monsters to destroy. She is the well-wisher to the freedom and independence of all. She is the champion and vindicator only of her own. She will commend the general cause by the countenance of her voice, and the benignant sympathy of her example. She well knows that by once enlisting under other banners than her own, were they even the banners of foreign independence, she would involve herself beyond the power of extrication….” [The rest is very much worth reading, too, but this section suffices for this post’s theme.]

It sounds an awful lot like the Caller‘s account of a “Cruz Doctrine”:

“‘I believe America should be a clarion voice for freedom. The bully pulpit of the American president has enormous potency,’ he [said], before praising former President Ronald Reagan for changing the ‘arc of history’ by demanding Soviet Premier Mikhail Gorbachev tear down the Berlin Wall and lambasting President Barack Obama for not sufficiently standing on the side of freedom during Iran’s 2009 Green Revolution.

“But, Cruz noted, speaking out for freedom ‘is qualitatively different from saying U.S. military forces should intervene to force democracy on foreign lands.’”

I’m not sure I’m with Cruz on Reagan rhetoric bringing down that “Evil Empire.” But for all my hesitancy about the place of moral considerations in American diplomacy, I have no problem with a president speaking out on such questions, provided he or she doesn’t create unjustified foreign expectations about American actions, or provoke dangerous responses. It’s also, after all, entirely conceivable that such statements can do some good.

Even better, like Adams, Cruz is skeptical about involving the United States in protracted democracy-promotion campaigns: “It is not the job of the U.S. military to engage in nation building to turn foreign countries into democratic utopias.”

So far so good. But Cruz betrays some deep ignorance on the subject of China, and on the magnitude of the security threat it poses to America versus that of, say, Cuba. Asked why he favors normal relations with human rights abusers like China and Saudi Arabia, but not with Cuba, Cruz (whose father was born on and fled the island) replied:

“The situation with Cuba and China are qualitatively different. For one thing, in China, direct investment is allowed, where American investment can go into the country invest directly and work with the Chinese people, which is bringing economic development and is transforming China in significant ways. In Cuba, all outside investment has to go through the government. Lifting sanctions will inevitably result in billions of dollars flowing into the Castro government into its repressive machinery.

“Secondly, China or Qatar or the different countries you mentioned, none of them are 90 miles from our border.” Cuba is uniquely situated 90 miles away from the state of Florida. Cuba is a leading exporter of terrorism throughout Latin America. Cuba was recently caught smuggling arms to North Korea in the Panama Canal.”

If he wasn’t running for president, or serving as a U.S. Senator, Cruz might deserve some slack for his clearly emotional feelings about Cuba and his family. But whatever his family background, these views are ridiculous. The economic picture painted of China is flat wrong. First, the Chinese government still sets very strict conditions on incoming investment, and second, although China’s economic growth and modernization unquestionably have benefited, so has China’s military strength and technological sophistication. Even many of the world’s most historically craven panda-huggers have decided that reform in the PRC has now shifted into reverse despite all the economic and even political liberalization that they once predicted inevitably would be produced by engagement with democratic, capitalist world.

Moreover, China’s burgeoning military power wouldn’t be such a concern if its leaders had decided to keep conducting a relatively quiet, passive foreign policy. But those days clearly are long gone, as Beijing has demonstrated a strong determination to expand its territory and influence in the East Asia/Pacific region at America’s expense. Moreover, the Chinese government’s burgeoning cyber-hacking activities are only the latest signs of the dangers of allowing current economically “normal” relations – including massive technology transfer – to proceed apace. And we haven’t even gotten to the damage to the U.S. economy and therefore to its defense industrial base and potential done by China’s predatory trade policies.

No matter how close to American shores lilliputian Cuba might be, it would need to turn into a something like a huge ISIS base even to start threatening major U.S. security interests to this extent – and of course such hostile assets would be easy for American forces to flatten, or simply to embargo into helplessness.

A final worrisome note on the (obviously still embryonic) formulation of Cruz’s foreign policy ideas: Although he claims to reject “full neocon-ism,” the advisers he told The Caller he consults with are all firmly in that camp. Since the end of the Cold War, American conservatism has bred an impressive variety of schools of foreign policy thinking (unlike American liberalism). The more such resources he taps, the likelier Cruz will be to develop an international strategy that both wins votes and furthers American interests.

Im-Politic: Behind The Donald’s Staying Power

03 Thursday Sep 2015

Posted by Alan Tonelson in Im-Politic

≈ 1 Comment

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2016 elections, Ben Carson, Democrats, Donald Trump, Hillary Clinton, Im-Politic, Immigration, Investors Business Daily, Monmouth University Poll, offshoring, Open Borders, Reagan Democrats, Republican Party, Ronald Reagan, Trade

OK, despite my best intentions, it’s back to writing on The Donald. Not that it’s all my fault. First of all, Trump totally dominated today’s news once again with his press conference announcing his agreement to report the eventual Republican presidential nominee. And the uproar his candidacy has triggered revolves around many of the major policy challenges facing the nation.

Even more interesting and revealing, though, have been two new polls that speak volumes about Trump’s electoral appeal and impact on presidential politics during this electoral cycle.

The first appeared in Investor’s Business Daily (IBD) and examined the crucial question of whether Trump can attract among working- and middle-class Americans the kind of support enjoyed by former President Ronald Reagan so consistently. In fact, this question is so important that the fact that’s it’s even being asked matters more at this early stage in the campaign than any data that can be found to answer it.

Mr. Reagan drove liberals and Democrats absolutely bonkers in the 1980s by winning huge numbers of such voters – including union members – even though his economic program of lower taxes, less regulation, and reduced non-defense spending supposedly served only the interests of that era’s One Percent. Explanations ranged from claims that these Main Street Americans were simply beguiled by the former president’s personality and communications skills; to gripes that they were (not so) closet racists and jingos; to more astute observations that their more traditional attitudes on social and national security issues were increasingly out of synch with a Democratic party that had moved considerably leftward.

That last point is especially important today, especially if you add in the growing economic insecurity and anxieties of this huge voting bloc, and its outrage at the offshoring-friendly trade policies and Open Borders-friendly immigration measures that it feels deserve much blame. So it’s easy to see why at least in principle such voters would be attracted to Trump. But is this true in fact? The IBD poll is hardly conclusive evidence, but it’s awfully suggestive.

According to IBS and its survey partner, the TIPP unit of the market research firm TechnoMetrica, Trump out-polled Democratic front-runner Hillary Clinton among the strong majorities of Americans unhappy with the state of the economy and the federal government’s responses. Clinton, whose party has historically claimed to champion “the common man,” did much better with respondents who were satisfied with the state of the nation.

Just to focus on one set of results, 46 percent of IBD-TIPP respondents believe the country remains in recession, 52 percent see no improvement in the economy, and 62 percent consider Washington’s economic policies as ineffective. Among Trump supporters, the above totals were 64 percent, 79 percent, and 90 percent. The precise numbers for the Clinton supporters aren’t provided, but the chart accompanying the IBD write-up makes clear that their views of the economy and related federal policies are much sunnier.

I’m not sure I’d go quite as far as this IBD author’s interpretation: “Democrats constantly claim to be the champions of struggling, middle-class families. But as the presidential campaigns get underway, it appears as though real-estate mogul turned reality TV star Donald Trump is the one capturing their hearts and minds.” But these signs of apparent political role reversal are highly suggestive.

The second poll was more of a standard horse-race survey, and showed that Trump has extended his lead among Republican voters over most of their party’s field in the last few weeks. That’s in-line with other polls’ recent results. But several findings of this Monmouth (NJ) University sounding really jumped out at me. The first two involved surgeon Ben Carson. It’s clear that Trump’s companion on the fringe of conventional politics has dramatically boosted his standing. But the Monmouth poll shows that it stunningly zoomed up from five percent in August to 18 percent this month so far. Trump’s backing increased from 26 percent to 30 percent. The other fascinating Carson-related takeaway is that he’s the only Republican contender who beat Trump head-to-head – by a convincing 55 percent to 36 percent. No other GOP hopeful even came close.

But the Monmouth poll also underscores how completely Trump has dominated news coverage of the Republican race. The evidence? When asked how favorably or unfavorably they viewed the field (a question that differs significantly from one asking about voting intentions), 42 percent of respondents said they had no opinion whatever of Wisconsin Governor Scott Walker (considered at one point a highly promising candidate), 43 percent chose this answer for businesswoman Carly Fiorina (widely thought to have been the winner of the “second-tier” Republican debate held last month), 59 percent had no opinion of Ohio Governor John Kasich, and 26 percent said the same about Carson. It seems reasonable to suppose that “no opinion” is another way of saying “haven’t heard much” – even though the race is being heavily covered in the national media.

Only 12 percent were this noncommittal when it came to Trump. The second-best performance on this score (20 percent) was turned in by former Florida Governor Jeb Bush, who until recently had been regarded as the single likeliest winner of the Republican presidential nomination.

It’s entirely possible that, at some point, one of Trump’s rivals will become the Next Big Thing in American politics, though time is running short for all with the possible exception of Carson. It seems much less possible that any Republicans currently in the real mix (except for Carson, again, and conceivably Kasich) can claim the bipartisan, crossover potential that Trump has so far displayed.

Our So-Called Foreign Policy: A Worrisome Obama Interview on Iran

15 Wednesday Jul 2015

Posted by Alan Tonelson in Uncategorized

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allies, arms control, China, Cold War, INF treaty, inspections, Iran, Iran deal, New York Times, nuclear proliferation, nuclear weapons, Obama, Our So-Called Foreign Policy, Richard Nixon, Robert Gates, Ronald Reagan, sanctions, Soviet Union, Thomas Friedman, verification

On Day Two of what we might call the Iran Nuclear Deal Era, I find myself wondering whether the more President Obama speaks out on the agreement, the weaker public support will get. Based on his new interview with New York Times columnist Thomas Friedman, this at least certainly should be the case.

To be clear, I continue to believe there could be a respectable case for Congress approving the agreement. It depends largely on technical questions about whether the monitoring and verification provisions really are crafted well enough to at least postpone Iran’s acquisition of a nuclear weapon. I have strong doubts for political reasons, as I’ve explained, but hesitate at this point to decide definitively. These are matters that should be illuminated by serious evaluation process by lawmakers. Yet the Friedman interview casts further doubt on Mr. Obama’s strategic and political judgment, which House and Senate members need to consider as well.

Arguably the loopiest claim Mr. Obama made in the interview came in response to Friedman’s question, “Why should the Iranians be afraid” of “serious U.S. military retaliation if [they cheat]?” In fact, the question itself was kind of loopy, since the most immediate question raised by the prospect of Iranian violations is whether sanctions really are certain to be “snapped back” on. Even so, I was startled to read Mr. Obama answer, “Because we could knock out their military in speed and dispatch if we chose to, and I think they have seen my willingness to take military action where I thought it was important for U.S. interests.”

Leave aside any doubts over the president’s trigger finger. Does he really believe that the United States, either alone or even together with allies, could reduce Iran to a military pygmy? If so, then why doesn’t he have similar confidence about destroying Iran’s nuclear complex? What’s known of it is located in many fewer locations than Tehran’s military deployments, and without any meaningful Iranian defenses, America would face a much easier challenge monitoring and, if need be, acting against any other facilities. Moreover, these undeclared sites would pose much less of a proliferation danger in the absence of the declared sites.

Just as important: Could this possibly be the Plan B I called for yesterday? At least for now, I sure hope not, especially given warnings against this course of action from a wide range of military experts in the United States, Israel, and abroad, including Mr. Obama’s own former Defense Secretary Robert Gates.

Mr. Obama’s discussion of sanctions, moreover, seems to bear out my concerns that international support for keeping Iran non-nuclear has always been paper-thin, and that as a result, talk of automatic or even highly likely snap back is nonsense. On the one hand, the president told Friedman that the current sanctions have “crippled the Iranian economy and ultimately brought them to the table.” He attributed their effectiveness to widespread global agreement that “it would be a great danger to the region, to our allies, to the world, if Iran possessed a nuclear weapon.”

On the other hand, however, Mr. Obama emphatically insisted that “in the absence of a deal, our ability to sustain these sanctions was not in the cards,” mainly because so many other countries had paid so much greater an economic price that America. He continued:

“if they saw us walking away from what technical experts believe is a legitimate mechanism to ensure that Iran does not have a nuclear weapon — if they saw that our diplomatic efforts were not sincere, or were trying to encompass not just the nuclear program, but every policy disagreement that we might have with Iran, then frankly, those sanctions would start falling apart very rapidly.”

But as I emphasized yesterday, countries that evidently have made their economic pain so clear to Mr. Obama can’t possibly view a nuclear weapons-free Iran as their top priority, and can’t be relied on to implement threats of snap back – unless an Iranian violation is genuinely obvious and egregious. In fact, the further into the deal’s time frame we proceed, the less reliable the allies will become – since they’ll have ever more Iran-related business to lose.

Finally, for now, it’s disturbing to see Mr. Obama compare his Iran breakthrough with (using Friedman’s words) “the same strategic logic that Presidents Richard Nixon and Ronald Reagan used to approach the Soviet Union and China.” But as I noted yesterday, America’s China policy looks ever more like an historic failure. Beijing has become increasingly powerful and belligerent, and the leadership’s hold on power has remained strong because the trade profits and technology it’s secured (largely) from the United States have enabled it to foster prosperity as well as build up its military.

If anything, the Reagan-Soviet analogy is further off base. The former president signed a treaty on intermediate range nuclear weapons (INF) with Mikhail Gorbachev, and agreed to resume talks with Moscow on longer range, strategic arms. But before the INF deal was signed, he deployed American missiles in Europe to offset previous Soviet installations, and more broadly launched a huge military (including nuclear) buildup that played a big role in persuading Soviet leaders that the vastly superior U.S. economy could race theirs into the ground. The president also worked overtime to keep curbs on western dealings with the Soviet economy – often over heated allied objections. And in an interesting coda, the Obama administration recently has accused Russia of violating the INF accord.

It’s still of course possible that Mr. Obama has produced an Iran deal that protects American national security better than any realistic alternative. But if he has, the Friedman interview strongly suggests that the adage “Nonsense in, nonsense out” (to put it politely) will never be the same.

Im-Politic: Budget Strengthens Case that Obama’s Border Security Strategy isn’t Serious

03 Tuesday Feb 2015

Posted by Alan Tonelson in Im-Politic

≈ 2 Comments

Tags

Biden, border security, budget, CAFTA, Central America, Colombia, foreign aid, George W. Bush, Im-Politic, Immigration, Obama, Plan Colombia, Ronald Reagan

With immigration and Department of Homeland Security funding at the center of a looming budget showdown between President Obama and Congress’ Republican leaders, it’s surely useful to look over the new Obama budget and see what it actually proposes on this front. And it’s hard to avoid concluding that the president’s claimed determination to bolster border security shouldn’t be taken seriously.

Let’s leave aside Mr. Obama’s “executive amnesty” move last fall, which can only strengthen the already powerful policy magnet that’s been luring illegal immigrants to the United States for so long. Yes, the president did propose to increase border security funding by nearly 25 percent over current funding levels – to just under $374 million. But the week before the official budget request was unveiled, the administration dropped a powerful hint that it doesn’t expect any of these new resources to do much good. Why else would the White House have touted so prominently – in a New York Times op-ed by the Vice President – its decision to attack the proverbial root causes of last year’s Central American immigration surge by spending $1 billion to promote reform in the region?

The administration’s ostensible belief that the best way to deal with the international problems facing the United States is to manipulate hard-to-contol revents abroad is, as I’ve written, a time-honored tenet of American foreign policy. With the huge but long-ago exceptions of post-World War II aid to Western Europe and Japan, this strategy has also failed so completely in the closely related foreign aid and trade spheres that it deserves the label delusional. Moreover, as I’ve also written, this approach becomes absolutely unforgivable upon realizing the unique geopolitical advantages enjoyed by the United States that make much easier-to-control and more promising domestic solutions – like serious border security efforts, in this case – vastly superior.

After all, it’s not as if the United States hasn’t tried promoting reform in Central America before. During the Cold War, President Reagan launched a “Caribbean Basin Initiative” aimed at preventing the rise of “new Cubas” and a repeat of the Sandinista revolution in Nicaragua. In 2005, Congress passed President George W. Bush’s Central America Free Trade Agreement, which was hyped in part as an immigration control measure. Vice President Biden’s own new article makes clear that substantial American aid to the region has been continuing. Yet he admits that the region’s countries are still held back by “inadequate education, institutional corruption, rampant crime and a lack of investment….”

Nor does Mr. Biden stop there in knee-capping his apparent belief that yet more money is the cure for most of what ails Central America. He adds that Central American countries and their economies still lack “clear rules and regulations; protections for investors; courts that can be trusted to adjudicate disputes fairly; serious efforts to root out corruption; protections for intellectual property; and transparency to ensure that international assistance is spent accountably and effectively.” Who can reasonably doubt, therefore, that what’s fundamentally crippling the region after all this time is not a lack of resources (especially considering how tiny these nations are) but a dysfunctional political culture. And why on earth does the Vice President suggest that this disease can be cured with more “training”?

Mr. Biden at least does provide some concrete answers – mainly, the U.S.-assisted transformation of the much larger nation of Colombia. There’s no doubt that progress has been made in that strife-torn country on many fronts. According to World Bank data, economic growth has been trending up and the poverty rate is declining. At the same time, though down from its peak at the turn of the century, illicit drug production in the country has now stabilized, and a final peace agreement to end Colombia’s 30-year insurgency remains elusive. (Indeed, casualties continue.) Moreover, although this progress has been made at the cost of $9 billion from American taxpayers, the Obama administration is still asking Congress for nearly $300 million more in annual aid in its new budget. More ominously, the end of a long global boom in raw materials is already imposing major economic pain throughout Latin America, which has relied on strong commodity exports for much of its recent growth. So expect those root socio-economic roots of mass emigration to start growing again all over the region.

A president serious about sensible immigration reform would recognize what a losing battle the nation has been fighting in order to curb illegal migrant inflows at their sources. Mr. Obama’s continued hype of these utopian proposals greatly strengthens the case that he’s anything but that president.

Im-Politic: Elizabeth Drew Remains the Consummate Insiders’ Champion

01 Sunday Feb 2015

Posted by Alan Tonelson in Im-Politic

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Beltway, bipartisanship, chattering class, Cold War, conservatives, Elizabeth Drew, ideologues, Im-Politic, Mainstream Media, pragmatists, Republicans, Ronald Reagan, stagflation, Tea Party

You don’t have to be thrilled with Tea Party Republicans to recognize that Elizabeth Drew’s genteelly sneering new article on the faction and its role in American politics these days superbly illustrates many of the biggest problems of the nation’s public life and especially of the Mainstream Media that cover it.

In a very important sense, Drew is no longer a pillar of the national journalistic establishment any more. At 78, she’s not cranking out copy frequently any more. But she does still write periodically for The New York Review of Books and, according to the Washington Post, she’s a “recent discovery of a new generation of journalists” who view her as a mentor. (Yes, that was meant as a compliment.) And starting in the 1960s, her detailed chronicles of political and policy battles for The Atlantic and The New Yorker were considered must-reads by the chattering class.

It’s not that Drew hasn’t done some insightful reporting and analyzing (though none of it comes to mind). But her latest piece betrays a blind spot regarding previous eras of American politics, including in her prime, that were more greatly and dangerously flawed than she remembers – and possibly than she realized at the time (which would be remarkable, considering all of her reporting on the Watergate years). And her rose-colored glasses have produced ongoing prejudices that mirror those of entirely too many of her colleagues today.

According to Drew, the Republican party today is “Divided and Scary.” And the Tea Party is largely to blame.

Its members are “purists” who “oppose any expansion of the federal government.” They are therefore the bane of the “pragmatists” in the party and throughout the capital who recognize that “without compromise there cannot be governing.” They are simply concerned with “making a statement and keeping their supporters fired up.” “[L]ike the NRA, they’ve figured out that absolute obstruction, outrageous as it may seem to others, can be a winning strategy.”

They fail to appreciate the solid conservatism of the likes of Senate Majority Leader Mitch McConnell and House Speaker John Boehner – although she upbraids these GOP mandarins for not acting like “the Republican congressional party of the 1990s, much less the 1960s….” Their main sin? Rather than genuinely “wanting to work with the president and show themselves as ‘positive’,” they have focused on efforts to “repeal, revise, and overturn a great deal of what Obama has achieved through laws and regulatory actions and executive orders.”

Among priorities considered by Drew as beyond the pale are attempts to:

>“roll back some of the president’s immigration initiatives, a move that could end in the deportation of millions….” (Presumably all Democrats are okey dokey with Obama’s exeutive amnesty and dedication Open Borders);

>”impose more sanctions on Iran that would undermine the administration’s current negotiations on nuclear capacity.” (I guess no Democrats supported the legislation?);

>and propose “a number of bills to overturn regulations adopted during Obama’s first six years, particularly those of the Environmental Protection Agency curbing carbon pollution.” (Of course there are no serious Constitutional issues at stake here.)

What a far cry from the Golden Age of the 1990s in particular, when “During the Clinton presidency, ten to twenty Senate Republicans were willing to work with the White House to try to negotiate deals on shared goals.”

But in fact, Drew is just getting warmed up. She charges that Republican efforts to transfer some power over programs from Washington back to the states, especially those that “allocate benefits,” contain “a trace of the old championing of ‘states’ rights’—code for fending off federal efforts to impose equity in the treatment of the races.” Indeed, the Republicans have become even worse than in their Nixon-Agnew law and order days, and are now addicted to “playing to anti-black and anti-minority sentiment in order to maintain their electoral strength.”

In Drew’s eyes, almost needless to say such despicable views lie behind the entire Republican party’s shift to “perfervid opposition to liberalization of immigration, combined with antipathy toward and fear of the growing numbers of minorities in this country. Not only racism but nativism is alive.”

Drew is correct on some points. Too many Republican Senate candidates in 2012 in particular were indeed “screwballs” (at best), harboring particularly hateful views towards women. Capitol Hill Republicans’ focus today on the Keystone pipeline and on rolling back even weakfish Wall Street reform is, respectively, bizarre and reprehensible.

But most of Drew’s critique is so one-sided that it’s clear she simply opposes most right-of-center positions on major issues. That’s her right, but why doesn’t she have the honesty to come out and admit her biases? (The same of course goes for so many of those younger mainstream journalists she’s reportedly been mentoring.)

More disturbing is Drew’s apparent obliviousness to the Tea Party’s belief that many of the nation’s worst problems today and recently stem precisely from the bipartisan, compromising impulses that she so reveres. She of all people should remember the bipartisan Cold War consensus that led directly to Vietnam. How well, moreover, has the federal government really served the economic interests of blacks and other minority Americans, especially once the great and needed battles of the Civil Rights era were fought and won? And what of the completely bipartisan creation of an economy based on binge-borrowing and consuming, which triggered the financial crisis and all of its painful aftermath?  

Nor does Drew evince any awareness that the taxonomy she (and others of her ilk) use to describe the conflict between insiders and outsiders is exactly the same that was used to describe Washington battles in the 1980s. Then it was commonplace for the commentariat to view former President Reagan’s most conservative supporters as “ideologues” and “cowboys” who threatened to endanger the nation and even blow up the entire world with their primitively radical and hawkish views. Their opponents within Republican (and often White House) ranks were supposedly the “pragmatists,” who luckily recognized the limits that domestic and foreign realities imposed on American actions, and who were determined to neutralize their less sophisticated rivals. Drew certainly displays no awareness that the Cold War might not have been ended and stagflation not cured (or at least not so quickly) had the “realists” and their conventional wisdom prevailed.     

I could go on. The main point, however, is not to insist that the Tea Party – and other outsiders – have always been right, and that Drew and the insiders have always been wrong. It’s to observe that Drew, the avowed pragmatist, and too many of her journalistic colleagues who are supposed to chronicle Washington and similar controversies with some degree of objectivity, won’t even consider them legitimately debatable. They’re smugly convinced that they hold a monopoly on truth, and unthinkingly equate their own strongly elitist prejudices with sweet reason itself.

Drew reportedly likes to recall her humble, outside-the-Beltway beginnings, when she was “Little Lizzie Brenner from Cincinnati.” Her latest piece is a sad reminder of how little of real importance she seems to have learned since those days.

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Current Thoughts on Trade

Terence P. Stewart

Protecting U.S. Workers

Marc to Market

So Much Nonsense Out There, So Little Time....

Alastair Winter

Chief Economist at Daniel Stewart & Co - Trying to make sense of Global Markets, Macroeconomics & Politics

Smaulgld

Real Estate + Economics + Gold + Silver

Reclaim the American Dream

So Much Nonsense Out There, So Little Time....

Mickey Kaus

Kausfiles

David Stockman's Contra Corner

Washington Decoded

So Much Nonsense Out There, So Little Time....

Upon Closer inspection

Keep America At Work

Sober Look

So Much Nonsense Out There, So Little Time....

Credit Writedowns

Finance, Economics and Markets

GubbmintCheese

So Much Nonsense Out There, So Little Time....

VoxEU.org: Recent Articles

So Much Nonsense Out There, So Little Time....

Michael Pettis' CHINA FINANCIAL MARKETS

New Economic Populist

So Much Nonsense Out There, So Little Time....

George Magnus

So Much Nonsense Out There, So Little Time....

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