Corporatism – Page 13 – The Wrongologist

Happy Birthday to our National Park Service

100 years ago yesterday, Woodrow Wilson signed the bill that created the National Park Service (NPS). The National Parks are truly a great American resource, showing us nature in a near-pristine form, much as it might have been thousands of years ago. The parks also give us insight into places that are an important part of our national heritage, such as battlefields, or landmarks, like the Statue of Liberty.

There was a time in America when protecting our heritage through preserving open space was thought to be a civic duty. Alas, that is no longer considered a responsibility by recent Congresses. Obama has used the Antiquities Act as a way around the stasis in Washington, creating several national monuments.

The most recent is the Katahdin Woods and Waters National Monument in northern Maine. There have been calls for a national park in northern Maine for a very long time, but the lack of federally controlled land and the hostility of local residents who believe the timber industry is going to make a comeback, made it impossible to get a park designation. But Roxane Quimby, founder of Burt’s Bees, gave almost 90,000 acres of pristine land to the government to help make something happen.

Opinions in Maine were mixed. There are more than a few folks who want the land to remain available to the paper mills, should the paper industry ever return to Maine. Republican Gov. Paul LePage denounced Quimby’s donation:

That’s one way to get out of paying taxes to the state of Maine…It’s also an ego play for Roxanne Quimby and Senator Angus King. It’s sad that rich, out-of-state liberals can team up with President Obama to force a national monument on rural Mainers who do not want it.

Last time we checked Quimby and King were in-state liberals, and the land was given to America, not to Mr. Obama.

Of course, the NPS faces major problems on its 100^th birthday. An NPR report indicated that the service is facing challenges like climate change, overcrowding, underfunding and relevancy. Regarding climate change, the parks are having to adapt to rapid changes as we saw in Glacier National Park, where most glaciers could be gone by 2030. The parks are trying to educate the public about climate change, despite continued hostility from Republicans who refuse to fund it.

Relevance is a big issue. Surveys show that the average park visitor is 41 years old and white, not the future of a young, diverse majority America that will be here about the same time as the glaciers disappear.

Finally, the number of sites managed by the NPS has grown from 35 in 1916 to 400 sites today. That has led to substantial deferred maintenance, and given that Congress is unlikely to come up with additional funding, the NPS is seeking corporate funding, and possibly sponsorship.

Imagine Yellowstone: brought to you by Coca-Cola…

This brings into question of the very meaning of the commons: If we sell sponsorships, who owns the Grand Canyon? Who decides how Glacier National Park should be managed?

But, in a world where the GOP won’t agree to fund the parks, that’s what you should expect.

On a happier note, here are photos taken on our final days in Banff National Park in Alberta, Canada. Here is Moraine Lake, a small, jewel-like glacier-fed lake, created by gigantic rock slide:

DSCN5657

The distinctive color is from the sunlight reflecting off of dissolved particles of finely ground rock called “glacial flour”. And here is a photo of Lake Louise in Banff:

DSCN5694

Lake Louise was named after Princess Louise Caroline Alberta (1848–1939), the fourth daughter of Queen Victoria. Apparently, the Province of Alberta is named after her as well. She never visited.

Here is a close-up of the Louise Glacier above the lake:

DSCN5676

The glacier is 300’ thick at the edge of the cliff wall.

Why is AARP Funding ALEC?

Yes, you heard that correctly, AARP, the insurance company that styles itself as a champion for senior citizens has become a corporate sponsor of ALEC.

Let’s remember what ALEC is: The name stands for the American Legislative Exchange Council. It operates by offering model legislation to its members, who typically are big corporations and conservative Republican state legislators. It was initially funded by the Koch Brothers.

Its legislative ideas cover practically every area of state government, from education and health to energy, environment and tax policy. State legislators introduce the ALEC-drafted bills in their home states, allowing ALEC’s legislative concepts to metastasize in almost identical laws in statehouses across the country.

ALEC has pushed for:

The repeal of the Affordable Care Act, which has saved Medicare enrollees millions of dollars by closing the Medicare drug benefit “doughnut hole.”
It opposed Medicaid expansion under Obamacare.
It has targeted public pensions, pushing to cap benefits and shift workers toward defined contribution plans, which shifts market risk onto the shoulders of individual workers.
It advocates for privatizing at least a portion of your Social Security taxes.

Governing, a publication for state and local policymakers, says that roughly 1,000 bills based on ALEC language are introduced in an average year, with about 20% getting enacted.

Since 2011, ALEC suffered a backlash, as a number of its corporate sponsors, (more than 100 corporations), pulled their support including Ford, Google, Facebook, and Microsoft, among many others. Eric Schmidt of Google told NPR after deciding to leave ALEC:

I think the consensus within the company was that that was some sort of mistake and so we’re trying to not do that in the future.

So why would AARP sign on as a corporate sponsor of ALEC? From the LA Times: (emphasis by the Wrongologist)

Among the policies that have been promoted by ALEC are several that arguably undermine the interests of seniors and retirees, AARP’s core constituency.

Despite that, the Center for Media and Democracy has learned that AARP joined ALEC, and that it is a named sponsor of the ALEC annual meeting that took place in Indianapolis, Indiana from July 27-29, 2016.

AARP didn’t hide its new financial relationship with ALEC, at least to ALEC legislators. The AARP logo appears in the conference brochure and attendees at the conference were each provided with an AARP branded portable USB power pack as they registered for the event.

Here is AARP’s corporate response when challenged about their new ALEC relationship: (emphasis by the Wrongologist)

In 2016, AARP paid a fee to ALEC, which gave us an opportunity to engage with state legislators and advance our members’ priorities from a position of strength at ALEC’s annual meeting.

AARP’s engagement with ALEC is NOT an endorsement of the organization’s policies either past or present. As is the case with other groups AARP engages with, there are many issues and areas where we strongly disagree with ALEC’s position or approach.

So, who in AARP’s marketing department convinced the top brass that they need to “pay” to meet with state legislators? And wouldn’t AARP members be very interested in what AARP’s management asked of state legislators?

From the LA Times:

Yet in arguing that a relationship with ALEC is necessary to “engage” with the legislators affiliated with the group, AARP is taking a different approach from the dozens of corporations that have abandoned ALEC.

Capitalism, It’s Not You, It’s Me

There is a meme that has gone global since the early days of the Occupy movement. Here it is as a wall graffiti from Greece that uses the same meme we first saw in NYC in 2011:

Capitalism Lotek

Just kidding capitalism, it really is you.

The artist is a Greek who styles himself as Lotek. The name Lotek is derived from the short story (and later, a film) by William Gibson called Johnny Mnemonic. The story is set in 2021, in a world ruled by corporations. An anti-authoritarian gang that are called Lo-Teks, fight the power. They are in fact not low tech at all, but are high tech hackers. Sound familiar?

Greece is surely a place at war with neoliberalism and free market capitalism. So is it also time for us to reconsider capitalism?

Consider this from Mark Blyth in Foreign Affairs:

An inherent tension exists between capitalism and democratic politics since capitalism allocates resources through markets, whereas democracy allocates power through voting.

The compromises both systems have struck with each other over recent history shapes our contemporary political and economic world. Blyth observes:

In the three decades that followed World War II, democracy set the rules, taming markets with the establishment of protective labor laws, restrictive financial regulations, and expanded welfare systems.
Starting in the 1970s, a globalized, deregulated capitalism, unconstrained by national borders, began to push back.

And today, capital markets and capitalists are setting the rules, and democratic governments follow them.

Some background: Cutting taxes in the 1980s caused government revenues to fall. Deficits widened, and interest rates rose as those deficits became harder to finance. At the same time, conservative governments, especially in the UK and the US, dismantled the regulations that had reined in the excesses of the financial service industry since the 1940s.

The financial industry began to grow unchecked, and as it expanded, investors sought safe assets that were highly liquid and provided good returns: the debt of developed countries.

This allowed governments to plug their deficits and spend more, all without raising taxes.

But the shift to financing the state through debt came at a cost. Since WW II, taxes on labor and capital had provided the foundation of postwar state spending. But, as governments began to rely more on debt, the tax-based states of the postwar era became the debt-based states of today.

This transformation had profound political consequences. The increase in government debt has allowed capitalists to override the preferences of citizens:

Bond-market investors can now exercise an effective veto on policies they don’t like by demanding higher interest rates when they replace old debt with new debt.
Investors can use courts to override the ability of states to default on their debts, as happened recently in Argentina
They can shut down an entire country’s payment system if that country votes against the interests of creditors, as happened in Greece in 2015.
Citizens United dictates who runs for office in the US, and in many cases, who wins.

Now that the financial industry has become more powerful than the people, should we blindly follow capitalism’s meme as the only way forward?

Free-market rhetoric hides the dependence of corporate profits on conditions provided for, and guaranteed by, governments. For example:

Our financial institutions insist that they should be free of meddlesome regulations while they depend on continuing access to cheap credit from the Federal Reserve.
Our pharmaceutical firms have resisted any government limits on their price-setting ability at the same time that they rely on government grants of monopolies through our patent system.

To use a sporting metaphor, it’s as if the best football team purchased not only the best coaches and facilities, but also bought the referees and the journalists as well. Those responsible for judging economic competition have lost all authority, which leaves the dream of ‘meritocracy’ or a ‘level playing field’ in tatters.

In our country, the divide between the business oligarchs, the political class and “the people” increasingly appears unbridgeable, marked by hostility and deep distrust. When people are told for a generation that government mustn’t make decisions that interfere with free markets, it is inevitable that people will lose faith in democratic governance, and in government’s capacity to help them solve their problems.

Capitalism in its current form no longer works for the people. We have seen a reaction in the start of movements by Occupy, by Bernie, and by others in Europe.

Remember that the greatest prosperity in living memory in the US came during the brief social democratic moment, in the 1950s and 1960s, when the constraints on business were the greatest.

More democracy and more economic justice are the necessary foundations for the path to a more prosperous, and sustainable economy.

A reformed capitalism must be a part of what emerges from that fight.

How Not to Cut the Deficit

Congress returned from the Independence Day break on Monday. They will leave again on Friday, and won’t return until after Labor Day. From The Hill:

Congress is poised to leave Washington…without passing funding to combat the Zika virus or completing work on spending bills to avoid a government shutdown.

One bill that might get passed is the re-authorization for Federal Aviation Administration programs that expire on Friday. Since Congress likes to fly, most think they will pass an extension that will last through September 2017.

If you’ve taken a flight this summer, you’ve likely been tied up in long TSA security lines. But you may not have focused on the real reason: Funding for the TSA has been sliced by 8.5% over the past five years, leading to a 5.5% drop in the number of screeners.

Yet, in the same period, the number of air travelers has increased by more than 15%. And those business wizards in Congress should be forced to tell the rest of us how a labor-intensive business can successfully process increasing numbers of customers with a smaller work force.

Steven Rattner in the NYT:

This year, discretionary spending — which encompasses airport security, infrastructure, education, research and development and much more — will be lower than it was in 2005. (Adjusted for inflation.

The discretionary portion of the federal budget, including education, research, infrastructure and other programs, has been falling, while spending on mandatory programs (including Social Security, Medicare and Medicaid) has been going up. Rattner reports that total government spending is up by 23% since 2005, while mandatory spending is up 45% in the same period, and discretionary spending is down 3%.

Here are some examples:

Since 2003, the National Institutes of Health (NIH), have seen their funding fall by 23%, forcing an 8% reduction in grants to researchers even as grant applications were rising by 50%.
In the past 10 years, spending on all education has fallen by 11% percent.
Since 2010, the IRS’s budget has been slashed by about 18%, even as the IRS was given new duties in connection with the passage of the Affordable Care Act. The result: The enforcement staff has shrunk by 23%, leading to a similar reduction in the number of audits. Fewer audits have meant additional uncollected taxes, estimated at $14 billion over the past two years. And almost a million pieces of unanswered correspondence from taxpayers need responses.
The EPA’s budget has been cut by an enormous 27% — about $3 billion since 2010. As a result, the agency had to eliminate more than 2,000 workers, bringing its staffing to the lowest level since 1989.

Last fall, a bi-partisan group added $80 billion in new discretionary spending over the next two years. Then, Congress doubled the cost of the deal by giving more money to the military and to Medicare, taking the deal to $154 billion while paying for about half the tab with legitimate savings.

A few months later, Congress retroactively extended a raft of expired tax provisions — without even a pretense of paying for them.

As a result of Congress’s fudging, the projected 2017 deficit rose to $561 billion, from the $416 billion that was estimated just six months earlier.

We shouldn’t expect that Congress will make any big decisions involving taxes or spending in an election year. But at the least Republicans need to stop using the appropriations tool to take aim at agencies such as the IRS and the EPA, whose missions they reject.

In the case of the TSA, Republicans want it privatized. Not because privatizing will save any money or make the TSA more effective, but to help a few of their corporate sponsors have another feed at the government trough. Republicans want to see schools, prisons, and the postal service privatized. The people who are employed by these private, profit-making companies will not be paid as well, and will not receive benefits they have today.

This is what you get when you believe that government should be “run like a business.” Certainly, we need a more efficient, better managed bureaucracy, but the deficit-cutting value of their fix is peanuts compared with the simple act of generating revenue.

You know, that would be raising taxes sufficient to pay for the critical tasks we require of the government.

The GOP would like you to think that Donald Trump represents a threat to Republican tax and deficit-cutting orthodoxy. To the extent Trump has revealed his thinking on tax policy, it looks consistent with the Republican Party. Trump’s grand accomplishment is to create an alliance between the true economic interests of the Republican Party and that segment of the American electorate largely marginalized and displaced by the actions of that same elite.

Welcome to the Republican paradise.

China’s Grand Strategy

In December 2015, Wrongo linked to a year-end prediction in the LA Times:

“One Belt, One Road”, also known as “OBOR,” is a new development strategy initiated by China in 2015 to promote its economic connectivity and cooperative relationship with nations in Eurasia by helping them develop infrastructure. These initiatives should also help Chinese exports.

OBOR is called the new Silk Road by the Chinese. The Silk Road was an ancient network of trade routes linking China’s merchants with Central Asia, the Middle East, Africa and Europe in the seventh century.

Now, China’s president, Xi Jinping, wants his country to revisit the time when the Silk Road was a conduit for diplomacy and economic expansion, and when Chinese silk was sent across the globe.

OBOR has drawn remarkably little attention and comment in the US, especially by our politicians and pundits, who prefer to focus on old white men in red ball caps.

This is surprising, considering OBOR’s economic implications and its geostrategic significance.

OBOR seeks to convert the Eurasian land mass into a single economy by interconnecting a network of roads, railroads, pipelines, ports, airports, and telecommunications links, and, based on these, to create a series of logistics corridors (One Belt). Supplementing this will be a maritime component (One Road), aimed at linking Southeast Asia, Oceania, and North Africa, through the South China Sea, the South Pacific Ocean, and the Indian Ocean. China would develop deep water ports and then build the infrastructure to link them to interior markets. Here is a graphic that shows the “One Belt, One Road” project:

OBOR Source: The Economist

China plans to commit $4 trillion to build out the OBOR project. That may sound like a lot, but China currently has $3.5 trillion in reserves, mostly in US$. The Chinese say that they have 900 deals in 60 countries in place, or in negotiation, or planned. Most would be designed, built and managed by Chinese enterprises, along with local partners. The Chinese government will directly or through several newly established funds they control, provide the financing for both the Chinese companies and their local partners, with low-interest loans or grants.

OBOR will enable China to employ the large project development capacity that it has built up during its industrialization and infrastructure development drive, much of which China now sees as surplus to current needs.

By seeking to use OBOR to create a Eurasian bloc, China resurrects Mackinder’s World Island Theory, described as: Whoever controls the Heartland of Europe and Asia will rule the world. The corollary is: Who controls the Land Power will unavoidably compete with who controls the Sea Power. Today, the US is the Sea Power, while control of the Land Power is up for grabs, and China is betting that OBOR can help it become the Land Power.

This is China’s Grand Strategy.

Russia is in an interesting position. On the one hand, China is its ally, particularly in oil and gas, with Russia as supplier, and China as the buyer. China will need Russia’s military strength along with its own to offset the military power of the US once the real competition begins. Also, Russia cannot ignore the positive significance that a strong OBOR could provide in its relations with the US and the EU.

China’s bet is that the US is losing its grip in Europe. And that the EU will not be a long-term player politically even if it is economically. The EU is challenged from within by stagnant economies, and challenged from the East by Russia, who sees the EU’s expansion to former Soviet bloc nations as both military and political threats. Possibly, Germany can be spilt off from the rest of Europe.

This is China’s plan for global economic and political primacy in the 21st century. The US response has been to continue playing geopolitics with breathtaking ineptitude: When you are number one, you ally with number three (Russia), against number two (China). Or better yet, get them to fight each other.

But when the US tries to contain both simultaneously, it pushes them together.

Most significant, an autonomous Asian nation is promulgating a global economic and political expansion through bilateral deals. It is presenting a positive and credible vision of future commercial and political success for many countries who no longer trust the West, if indeed, they ever did.

This is very much against the multilateral trade model that the US and the EU have stood for in the past 70 years. Sadly, the West has not demonstrated any positive vision for the future since the end of the cold war.

But trust Trump. He’ll make a great deal, and those Chinese will certainly stay at home.

July 4, 2016

Independence Day 2016. And 240 years later, where are we?

COW Our Sad Fourth

Our founders were willing to die for an idea. They wanted home rule, not a local dictatorship run by a representative of an English King. There were spirited debates around the ideas that founded our Republic, and there were those who worked hard to keep the rule of the King in place.

So are the contentious debates of today just more of the same? Here is a small taste of Sebastian Junger’s new book, “Tribe”: (pg. 124)

Today’s veterans often come home to find that, although they’re willing to die for their country, they’re not sure how to live in it.

He goes on:

It’s hard to know how to live for a country that regularly tears itself apart along every possible ethnic and demographic boundary.

On the front lines, GI’s know their buddies are different in all sorts of ways, but they set aside their differences and form units that transcend differences, often heroically. Yet, in 2016 America, on a different set of front lines, our politicians amplify differences, going so far as to regularly accuse rivals of deliberately trying to harm their country.

Our society is at war with itself. Depending on their ideology, people speak with complete contempt about the rich, the poor, the educated, or the foreign-born. They express the same contempt for the president, and again, depending on their ideology, the entire US government.

That’s a level of contempt we have usually reserved for enemies in a time of war. But now, we apply it to our fellow citizens. Contempt is particularly toxic because it implies that the attacker has a position of moral superiority, and through that, has the agency to attack another.

So, on our most patriotic day, put down that hot dog, and ask the question: How do we unify a secure, wealthy country that is now playing a zero-sum political game?

Time to wake up, America! And to help with that, let’s dance around the room with a little rockabilly by Elvis Presley. Elvis was treated with contempt by some in the 1950s, but it was mostly silent, and by the Silent Generation, who thought they were protecting their kids from rock & roll.

Take a listen to “Good Rockin Tonight”, and remember Scotty Moore, the original guitarist for Elvis, who died last Tuesday. He was not just our last living link to the King (assuming the King is really dead), he was the force behind Elvis’s early singles. Scotty is in the Rock & Roll Hall of Fame.

His reverb-drenched rockabilly guitar was the driver in the originally drummer-less trio of Elvis, Scotty and bassist Bill Black:

COW Elvis and Scotty

Rolling Stone ranks Scotty Moore No. 29 on its list of the 100 greatest guitarists of all time, saying “The playing was so forceful that it’s easy to forget there was no drummer.”

Keith Richards has said:

Everyone else wanted to be Elvis. I wanted to be Scotty.

Here are Elvis, Scotty and Bill on “Good Rockin Tonight”:

Brexit: Better for the Pant Load or for the Pant Suit?

Around here, Monday means a wake-up tune. We should have Brexit breakup music, but instead of song, we need to watch this video by Mark Blythe, a Scottish political scientist, and a professor of international political economy at Brown University, about the logic behind voting for Brexit:

Blythe makes more sense in 5 minutes about the EU, why Brexit happened, and some implications for the US, than the entire journalistic class has said using millions of words over the past few days. At 4:01, he says, “As I like to say to my hedge fund friends, the Hamptons is not a defensible [military] position.”

Let’s take a quick look at a few conclusions of the Brexit vote:

Rust cities and towns largely voted to Leave
Wealthy cities favored Remain
Rural areas that have not seen much immigration had seen a lot of austerity
Older voters wanted to return to the prosperous 1970s-1980s, regardless of whether that is realistic

Demographically, the most striking difference in voting was between young people and older people. A YouGov poll showed:

18-24: 75% voted for Remain
25-49: 56% voted for Remain
50-64: 44% voted for Remain
65+: 39% voted for Remain

So younger voters wanted to keep the option to be citizens of a larger economic unit, where they might find more and better job opportunity, while older voters wanted out of the EU for a variety of fact-based and fear-based reasons. On either side of the Atlantic, it’s a mistake to think that people know all the facts before they decide. From Seth Godin:

There are two common causes of uninformed dissent…The second (quite common in a political situation), is the tribal imperative that people like us do things like this. No need to do the science, or understand the consequences or ask hard questions. Instead, focus on the emotional/cultural elements and think about the facts later.

Our first Brexit lesson is that America has a huge base that is angry, scared, and possibly, more than willing to jump into the abyss. Sober analysts warned Britons that pulling out of the EU would be an economic and security debacle. But, as Matthew d’Ancona of The Guardian observed:

They heard the warnings, listened to experts of every kind tell them that Brexit meant disaster, watched the prime minister as he urged them not to take a terrible risk…And their answer was: Get stuffed.

Our second Brexit lesson is that nativism, anti-immigration fervor, and elite-bashing are potent tools.

There was a definite scent of “Make Britain Great Again” running through the Leave campaign. The Leavers urged Britain to “take control” of its borders. While we point at Mexico, they pointed at Turkey, which they said would flood the UK with immigrants, even though Turkey may never be a member of the EU.

You can call it racism, you can blame it on the “market” or, you can blame it on the economic circumstances created by the political elites steering the ship.

This resonates in the US because foreigners are a source of marginal cheap labor that corporations use to bludgeon our working class. That anger is partly justified. However, it is misdirected, because people only believe what they want to believe, and because it’s easier for working people to blame foreigners than to blame themselves for repeatedly electing an economic elite that just keeps playing them over and over.

Brexit is an important wake-up for the US presidential election. Britain’s uprising against the European Union is the sort of populist victory over establishment politics that could easily happen here. As the NYT said on Sunday:

Mrs. Clinton shares more with the defeated “Remain” campaign than a similar slogan — her “Stronger Together” echoing its [Remain’s] “Stronger In.” Her fundamental argument, much akin to Prime Minister David Cameron’s against British withdrawal from the European Union, is that Americans should value stability and incremental change over the risks entailed in radical change and the possibility of chaos if Donald J. Trump wins the presidency.

Hillary urges potential voters to see the big picture, while promising to manage economic and immigration upheaval, just as Mr. Cameron did. She is also a pragmatist battling against nationalist anger, cautioning that the turmoil after the Brexit vote underscored a need for “calm, steady, experienced leadership in the White House.”

But we are not the UK, and today, the ABC/WaPo poll has Hillary is up by 12 points, although we still have miles to go before 2016’s election night.

We will have future columns covering our neo-liberal policies, their impact on the American people, and their implications for 2016, over the coming days and weeks.

The Pant Suit vs. the Pant Load – Jobs, Part Infinity

We are in a time when a presidential candidate’s personality counts for more than the candidate’s policies. Candidates obfuscate on most policy issues and the media lets them get away with absolutely outrageous declarations of near-facts or outright half-truths.

One policy we must make them nail down explicitly is their jobs policy.

The key to making America great again is adding more jobs. Wrongo is a pest on this subject, but without more jobs, growth in GDP is harder to achieve. Tax revenues are more difficult to grow. People who are idle get into trouble.

The Pant Suit and the Pant Load know this, so they will talk from here to November about adding manufacturing jobs back to cities that lost them starting in the 1970’s. Those jobs are never coming back, but both of them are working hard to convince you they can do it. Consider this, from Parallel Narratives:

We’re now being told by folks who know better that all we need to do to bring those jobs back, to resurrect a future we can believe in, or make America great again, is to elect the outsider politician who is not beholden to elite interests like banks, CEOs and politicians. Unfortunately, that horse has left the barn, those jobs are gone for good…

A great example of a politician braying the “I can bring jobs back” mantra was in Sunday’s NYT business section’s column, “Preoccupations.” In it, a young couple had the option to work from home, so they moved from Austin, TX, that hot-bed of tech, to South Portland ME, not so techie. They work for two different firms from two home offices. Then, they are invited to attend a funds-raiser for a gubernatorial candidate: (emphasis by the Wrongologist)

The candidate raising campaign funds was a hard-working lawyer who seemed genuinely well meaning, but no one had told him that his economic platform of protecting manufacturing jobs and Maine’s traditional industries wasn’t going to fly with an audience of health care professionals, programmers, web designers and researchers…We muttered to each other that this guy didn’t have a place in his platform for people like us, many of whom worked for employers in other states. Our checkbooks stayed in our pockets.

If you hear this kind of BS from the Pant Suit or the Pant Load, your checkbook should also remain hidden.

While the low-wage jobs problem has been around for more than 40 years, America’s politicians are still peddling the same solutions. In fact, a new analysis from the White House’s Council of Economic Advisers (CEA) released Monday shows that only 88% of men ages 25 to 54 are participating in the US workforce. The CEA reports that the US has the third-lowest labor-force participation rate for “prime-age men” among the world’s developed countries. We have done so well that, on a percentage basis, Greece, Slovenia and Turkey all have more men working than the US does. Greece! The decline is concentrated among less educated. Here is a chart:

Male Labor Force Part by Edu

More than 95% of men used to work in 1964, regardless of their educational attainment. Today, you better have at least a bachelor’s degree if you want to be sure you will get a job. But it is worse than that. The CEA said:

In recent decades, less-educated Americans have suffered a reduction in their wages relative to other groups. From 1975 until 2014, relative wages for those with a high school degree fell from over 80% of the amount earned by workers with at least a college degree to less than 60%.

Clinton and Trump would have you believe that the problem is bad trade deals with China, the TPP, or immigration. Trump in particular, is saying that the political elites have knowingly caused this all at the expense of the American worker. There is a modicum of truth to that, but it is the American corporation and the American tax code that is closing out US jobs, and hammering the middle class. American corporations now pay about 11% of our total US taxes, down from about 30% of US taxes in 1960, as jobs (and markets) have moved abroad.

What are the Pant Suit and/or the Pant Load going to do in the face of advancing automation now facing us not just in manufacturing, but also in the service and knowledge industries?

It is time to make the candidates talk about this on the campaign trail.

The basic policy choice we have is to put people to work, or to continue to allow the profit motive to dominate. If the profit motive remains supreme, we will continue our relentless drive to reduce labor costs — by eliminating jobs, or by paying workers less for the same work.

To date, our leaders have chosen the latter path, and we have reaped the results. We have become a land of spreadsheets and flags.

Pant Suit vs. Pant Load, Part III

(Note: this week there will be no Sunday Cartoon Blogging, since Wrongo will be visiting MA and PA through Sunday, returning on Monday.)

Wrongo and long-time blog reader Terry engaged in a short email dialog on how to “fix” the US political system. We were concerned that there is no individual Congressperson accountability. A backbencher can follow an agenda that can imperil our nation (and a few have done just that) without consequence.

But in America, accountability is managed by election district. Your only alternative is to round up enough votes to replace poor representation. So, if you wanted to reform the impact that money has in our politics, or the way the filibuster works in the Senate, you have to reform Congress.

Yet, under our Constitution, only Congress can reform Congress. And today, there are three parties vying for control of it, and since they rarely are willing to work with each other, not much gets done. So you can completely forget about Reform.

And the parties have not been willing to deal with the not-so hidden desperation in America that shows up in statistics like increasing opioid addiction and suicide rates. The political class ignores how lethal the US economy is for the less fortunate: The New York Times reported this week that US death rates have risen for the first time in a decade.

The increase in death rates among less educated whites since 2001 is roughly the size of the AIDS epidemic. One reason is the use of opioids. And, despite Mr. Obama’s speech in Elkhart, IN where he said our economy is doing well, there has been a spike in suicides to levels higher than during the 2008 financial crisis.

The little people know that the economic policies followed by both parties have brought income inequality to Gilded Age levels. They know that all of the post-crisis income gains have accrued to the top 1%. Unlike in China which continues to grow, our economic expansion has brought with it high unemployment and underemployment, particularly among the young.

As a result, people feel powerless. In fact, a RAND survey in January found that 86.5% of GOP voters who strongly identified with the statement “people like me don’t have any say about what the government does” were Trump supporters.

And, since so much of politics is about corralling money into the bank accounts of our politicians, your Congresspersons have no intention of listening to you unless you have given at least $10,000 to their campaign fund, or are the CEO of a major employer in their district or state. In US politics, money=speech. But, there is little meaning to free speech without free access to influence the political process.

Many of us feel nihilistic about our politics and our government. So the Pant Load’s support seems a lot like a form of public political vandalism where The Donald is the can of spray paint.

Most people can see that a large portion of Americans are poorer with each new election cycle. After all, the reason Trump (and Sanders) are doing well is because many, many workers are seeing their job security, income security, and retirement security all go up in smoke. That’s no mystery, just the natural outcome when the government fails to represent the people in favor of the rich who fund their campaigns. It’s no wonder the Pant Load is easily corralling the frustrated.

But can the Pant Suit reverse the Democratic Party’s abandonment of the working class in America?

We know that she needs to focus on drawing more potential working class and young supporters, but so far, Democrats are content to run only in their municipal strongholds, following a strategy of stitching together interest groups, largely in states with big urban populations.

Energizing people around the fact of our corrupt political system is both a way to get higher turnout, and a way to elect members of Congress and state legislatures to fix the corrupt system. That is Bernie’s message, what he calls a “political revolution.” But Sanders is not the person to bring this about. Consider Sanders just the messenger.

Strategically, the Pant Suit needs to figure out how to get folks energized enough to vote for her and against Trump for reasons that don’t so paralyze them with fear that they stay home. If she is successful, it could be the start of re-establishing the New Deal coalition, and a re-installation of the principles of the civil rights movement.

That’s a huge job that will not be completed in one election cycle.

This threat is the GOP’s worst nightmare. They have worked for 40 years to eliminate these ideas, so expect the GOP to unanimously support the Pant Load:

COW Never Hillary

The Bernie Dems will rally behind Hillary for similar reasons.

Trump/Arpaio 2016: Because immigrants are the greatest threat to the nation.

The Wrongologist

Geopolitics, Power and Political Economy

Category: Corporatism