More gruel
The ‘Trump Whisperers’ have a point

The ‘Trump Whisperers’ have a point

It is undoubtedly the most irritating journalistic genre to emerge from our present national crisis. Across the first half of 2017 we were treated to a toxic flood of treacly interviews with The Suffering Trump Voter. This genre featured down-and-out Trump voters and emphasized their “heart” and “anguish” while soft-pedaling their bigotry. Chris Arnade turned it into an art form, complete with its own rituals (visiting the McDonalds) and slogans (front row kids and back row kids) before apparently melting down and disappearing. Saleno Zito parlayed her Trump Whispering into a job at Rupert Murdoch’s New York Post. Almost everyone who was anyone took at stab at the “Trump voters are crying for help” schtick at one point or another.

As the year wore on, the act wore thin. More and more journalists started wandering into diners in Allentown and Moline and Fort Wayne. Where the first round of Trump Whisperers stuck carefully to their soft-focused, poverty-porn message, these new explorers asked a few more questions and got the answers you always would have expected. By November, you could see Trump Whisperer pieces anchored around interviewees dropping N-bombs.

I’ve been unfortunate enough to hear personal accounts from many more Trump voters than I would have liked. The overwhelming bulk of them were precisely the kind of incoherent bigoted rubbish you would expect, however amid the hysterical rants have been a number of troubling insights. Several of these Trump voters have been people who I know were Obama voters, thanks to my decade of work as a Republican precinct committeeman. A few of them are black. Thanks to my roots in Texas I’ve seen the naked racism of the average Trump voter up close, but I’ve also observed the wider, more complicated picture.

In September, Ta-Nehisi Coates tore into George Packer for his sympathetic treatment of Trump supporters in 2016. Packer wrote a remarkably powerful response. Though it pains me, I must say that Packer has the more persuasive argument. Without referencing Packer or Coates, I weighed in on this question in a piece at Forbes today. Revisiting Trump’s obscene spectacle at the Carrier factory in Indianapolis last December, I considered the ways that Republican racism may be obscuring some deeper, festering economic and political issues. Racism is a central problem for white America, but our focus on white bigotry may interfere with our ability to recognize and address potentially disastrous political failures.


  1. I liked your article Chris better than Packer’s. He was on defense whereas you were using the cogent Carrier photo-op?? I don’t know what you’d call that event, maybe it was poverty porn as your jumping off point. I relate to your article. I can’t talk with my relatives who are stuck in one of the pockets of the US with one employer in town who is half out the door.

    Real jobs in the new economy requires critical thinking skills and sophisticated use of technology and a real education. They don’t want to hear that as they can’t imagine going to school or relocating (the somewheres and the anywheres). They are genuinely disappointed with Trump. It was throwing spaghetti against the wall kind of a vote for them. I call it wishful thinking. They wanted to believe him because it was easier than their real choices. They are terrified of losing their “crappy” Obamacare and their jobs because they would lose their house that no one will ever buy. They are barreling towards 50 without retirement savings, uneducated kids still living with them. They are bigots, they hate that I’m gay so insist on this weird we don’t know you’re gay game. They don’t know or care to know people of color. If I ever figure out a way to to have a meaningful conversation with them that doesn’t end in an ugly argument I will share. I haven’t been successful so far. I assume politicians aren’t talking to them because they don’t have any easy answers. Trump vomited Fun Time Candy Land crap at them and they took it because “hey, it would be great if he did any of it”. I doubt they will que up to vote for the guy again. Unless a person of color or queer runs against him.

    1. “Classical liberal economics has shown us how to create a global economic machine of spectacular power. It has not shown us how to harness that machine toward broad public benefit. Neither Republican government-slashing nor Democratic patronage offer an appealing vision for those left behind in our shriveling middle.”

      Is there an answer to this problem?

      1. I think there is, but I think it will be a very long time before we get a chance to try it.

        The traditional socialist response is to use central planning and heavy-handed government intervention to redistribute power and money. It works, but it severely constrains the power of that system to generate value. In other words, it works by making everyone poorer.

        An alternative approach was being developed by Milton Friedmann and Friedrick Hayek late in their lives. It leverages rule making, direct forms of income redistribution, and insurance to “price-in” the negative externalities of capitalism. Republicans took an interest in this idea in the late 80’s and early 90’s, just before the Confederates took over, and early results were very promises. The Montreal Protocol to limit CFC emissions was an early example of this approach.

        Here are a few examples. A traditional approach to carbon pollution would be to impose thousands of pages of new rules on power plants, auto manufacturers, airlines and dozens of other industries. Industries with the best lobbyists would come out best, some skating by completely. Meanwhile the effectiveness of those rules would be riddled with unintended consequences.

        This philosophy would limit carbon emissions by imposing a tradeable tax on carbon production. That’s about it. It would recognize that markets will not solve carbon pollution on their own, while also recognize the power of markets to solve all kinds of downstream problems. The legislation might be a few dozen pages, with a few dozen pages of enabling regulations. And it would probably work.

        Instead of adopting a national, single-payer insurance program, this approach might create a tax-funded voucher system, applied at the state level, which would provide everyone with basic coverage through the existing private system. There would need to be significant price controls and other provisions to manage some problems with the health care market, but otherwise it would be fairly simple.

        The welfare system might be replaced entirely with a national profit-sharing program. Everyone who’s income dipped below a certain level in a given month would get a check. The amount of the support might move based on economic growth/contraction.

        Instead of writing thousands of pages of new rules on which kinds, shapes and colors of guns can be sold, this approach might impose an universal insurance requirement. People who want to own enormous arsenals, or fail to secure their weapons, maintain training, etc, would be priced out of ownership. People who own weapons responsibly would be fine.

        And so on and so on. It’s an approach that tries to solve some of the most frustrating problems of capitalism without swimming against the broader tide of decentralization, rising complexity, and personal freedom. No one is advocating this approach anymore. I think we’ll cycle through another round of stultifying and failed 20th century socialism before we get a chance to try this.

  2. Anyone watch the Petersen-Kennedy judicial interview? This is the kind of thing that is slipping under the radar. And even if it is acknowledged, apparently the Democrats can do nothing about it.

    Seriously, what recourse do the Democrats have if by some miracle they regain power in the future, when the bench is completely remade with right-wing extremists, who are appointed for life?

    People say, obviously, with a lot of reason, that violence is not the answer. But precisely what options does a democratic society have if the courts are controlled by such people? All legislation made by Democrats can, and will, be challenged legally, and given the stacked deck in the courts, will be stopped.

    Case in point: assume the Net Neutrality ruling is reversed in 2020, and naturally the big telecoms sue. With the kangeroo court being assembled, no chance that ruling gets successfully through the courts.

    1. There is so much that will need to be “undone” or “redone” that it is overwhelming. Yes, saw a clip of that pathetic interview and also noted this Kennedy is a Republican and he nailed the judicial nominees to the wall. Of course, why were such pathetic applicants put up? My reading indicates the the National BAR opposed all of them.

      1. Mary, the question is how can this be “undone”?

        As far as I can tell, the three criteria needed to be appointed to the federal court by McConnell (yeah, this is his show, and the puppet tyrant is only the rubber stamp) are youth, good health, and an adherence to extreme right-wing views.

        How does one remove an extremist who is appointed for life?

      2. Mary, you and others have talked about the fascists “throwing away the playbook”, or “how we need to outvote them”, or “we are stuck with them”.

        I ask the same question over and over again: “Why?”
        If the fascists wrote their own playbook, or ignored all precedent, if the Democrats ever regain power, why should they follow any rules?

        The current regime is completely illegitimate. The presidency was rigged on 3 states, with the widest margin in Pennsylvania of 1.4%. That means if 0.7% of the electorate, or 1 in 140 people, had not been influenced by the Russian propaganda and hacking and flipped their vote, Pennsylvania would have gone Democrat, The margins were much smaller for Wisconsin and Michigan.

        Out of 140 people, do you seriously think that not one of them did not flip their vote to the fascists after reading all the lies on Facebook and seeing all the stuff that Wikipedia leaked?

        So assuming the presidency rigged, forgetting about the Senate, how many judges would never have illegally appointed , or ACA changes that would have been vetoed, or a tax plan that would have been vetoed, or a withdrawal from the Paris Accord never happened, the list goes on…..

        If Mueller is allowed to finish his investigation, which I doubt more every day, and he proves that the Russians rigged the election, and the current regime colluded with the Russians, do the Democrats have the will to risk a civil war and say “we no longer recognize the presidency, or any of the changes or appointments made since Jan 20, 2017”.

        Chris brought this up in more eloquently that I ever could a couple posts ago. I am reiterating the question, in more blunt terms.

      3. Dinsdale, a bit of a nitpick here, but the fake news was likely more effective in manipulating turnout – rallying Trump supporters and discouraging lukewarm Clinton supporters – than it was at actually changing people’s minds toward voting Republican.

        As far as Democrats calling a “do over” on all of Trump’s actions in office: that would be a whole new constitutional crisis, and could easily be seen as an unethical power grab on par with Russian collusion. Unfortunately, I don’t think they could muster the political tailwind they would need to pull off something that bold, even as the Trump administration goes down in flames. And if the Democrats can’t command enough legitimacy when they draw their line in the sand, I fear the ensuing fight would devastate the American political system, whether it takes the form a shooting war or a political one.

      4. If Dems have learned nothing from 2016, it should be this: “It needs to give its base a reason to vote.” This happened in AL with a solid Dem candidate who understood and campaigned on issues important to the Black voter and whoi they trusted was not using them. They voted in numbers far beyond expectations. We were fortunate that the GOP candidate was so poor and that the party was divided over supporting him. Many Repub voters simply stayed home, as more analysis is coming out of that vote demographic.

  3. Here’s an attractive, fully rounded article about the economic predicament people (all people, not just Millennials, but that keyword draws clicks) are in.

    It covers the systematic hurdles new workers have to overcome, some of the reasons some of those hurdles exist, the amount of people who are tripping over those hurdles, and various solutions to how those hurdles may be removed — or at least lowered.

    The Huffington Post is a liberal periodical and the approach they take is more akin to Bernie’s rants than Trump’s.

    It’s also boring to read for anyone who has been paying attention since before the recession, because it covers information anyone who has been paying attention already knows.

    So why, again, do Trump voters ‘have a point’? Because they’re aware of well-documented and clear systematic issues, but are angrier and stupider about it?

    Nobody has to listen to rants about brown people and Muslims to understand the economic pain that’s going on. In fact, those selfsame rants will rant against the solutions that could alleviate the pain by calling them socialism.

    Just as Republicans being the problem doesn’t necessarily make Democrats the answer, Trump voters being the problem doesn’t necessarily make Huffington Post’s solutions — or Bernie — the best answer. But they’re a hell of a lot better answers than anything the Trump voters have to say about it.

    1. Aaron, this is a well-put-together article.

      I’m at the bleeding forward edge of the boomers. For a long time, I felt millennials were not political enough, that they saw no relationship to mundane governmental actions and their lives.

      But since the T election, they’ve been great. I hope more and more articles like this, linking specific policies to specific life situations, are published widely.

      The article also made me wonder, should I die while still luckily owning a house, if I should simply will my house to a millennial niece instead of turning it into cash to be dispersed.

      Having a house, a place to live while not actively working, is central to my life now. It could be central to hers, too, in not so many years.

    2. The article was really good, but did seem to start off emphasizing a the millennial’s problems as being something laid on them by boomers. In reality, it’s clearly a class problem, or maybe more accurately a capital vs. labor one, not a generational one, and near the end the article did make that point.

  4. I need to do something completely unfathomable and have to side with Bannon and Trump on something.

    The problem isn’t the people. The problem is the platform, the establishment. The Republican Party is tribally married to an abusive party that controls it. Nothing the party does benefits the average republican voter, but they keep voting for them.

    The first place to look is education. I’ll be the first to point out that it’s considered a joke that odds are the average Alabaman can’t spell their state out loud on the first try, and I hang out with a friend and father from Arkansas who can barely read chat. Republicans have done generational damage at a basic educational level to a significant portion of the country’s population.

    Evangelical sentiments and pandering to anti-intellectual sentiments have significantly weakened rural basic education. You have Republicans being appointed to public office without even knowing what that office is responsible for (Rick Perry), or having some kind of saboteur agenda (Ajit Pai). You have elected Republicans acting in blatant opposition to popular opinion, yet existing in what is a consequence free environment because their voters are quite apparently too poorly educated and too tribally loyal to know better.

    I’ve said for over a year, that Republicans have bred his monster of ignorance and loyalty, and Trump isn’t a leader, he’s a symptom, and a cry for help. That’s the one place Bannon has it right: Republican establishments across the country are exploiting their voters, rather than being held accountable.

    1. Racism is a tradition. It’s generational. It’s something that can’t be unlearned or untaught. It’s something that has to die out, and that means a lot of time.

      It’s perpetuated by children learning it from their families and peers, and it’s worse when they aren’t being properly taught critical skills from neutral sources. If you don’t take the time to teach and reinforce to a child what is inappropriate behavior, you likely end up with an adult that doesn’t see what’s wrong with it, and that will stay with them until they’re dead.

      This is massively problematic when you have an entire tracts population that haven’t been taught what is inappropriate or destructive outside their own little small ecosystems, who then vote as such at a national level. You end up with the obstructionist Tea Party. You end up with Trump. You end up with Moore, and Charlottesville.

      1. I’ll agree that racism is generational. It is something that is learned behavior from childhood. However, I disagree regarding it being something that can be unlearned or not overcome. Since once learned racism becomes part of our biases, one has to work to overcome it. But it can be done. Basically people have to realize it is wrong and make a conscious effort to overcome it. It helps if one has contact with minorities. Oftentimes, the racism is implanted and then there is no contact with any minorities. This prolongs the condition of racism.

        From the standpoint of the political situation in the U.S. having one party consistently appealing to the basest attitudes and instincts of Americans has aggravated the situation. If that party had consistently tried to educate and emphasize the correct and decent solutions, the political situation in the US would be far less polarized and much better. You all know which party that is.

        I know that racism can be overcome from personal experience.

      2. I agree, TM. It takes time, it is not easy, but it is possible for people to change racist behavior and views. Obviously, it is more difficult the older and more entrenched racism is, but thankfully, our young people are helping us become more tolerant of our diversity. The rest will just have to die out.

    2. Yes, the Republican establishment has carefully cultivated a base who accepts their message without critical examination. Blame that on education, blame it on clever messengers, but ultimately, each individual is responsible. It’s difficult to sort the “chicken and egg” set of factors here but clearly the GOP understands what it is doing and the base either doesn’t care, likes their message, or is simply too intellectually lazy to challenge it. The outcome is the same and that may never change for some people…lots of “some” people. I keep going back to Fly’s simple observation: We will just have to out-vote them.

      1. “We’ll just have to outvote them”

        That, also, appears to be a generational solution. The side effect to living longer is bad ideas are staying alive longer.

        the “traditional” solution to ensure bad ideas die out was simple: you simply killed the guy with the bad ideas. Democracy by survival. In civilized society, you have to wait for them to eventually pass, and hope in those extended years they did not perpetuate those ideas into their children.

        Millennials are probably the most powerful voting blocs out there, but they are smart and very aware that the parties only want to exploit their vote, not give them a voice. They won’t get that voice by being cattled about by the Grumpy Old Men of congress. They’re waiting for them to die off.

    3. “The problem is the platform, the establishment.”

      The problem with Ladd’s Trump Whisperers having a point is that it’s a point that was already well documented. The problem with your sympathy for Messrs. Vengeance is that every American has their way of talking shit about ‘the establishment’ and this has been the case for my entire life.

      You don’t have to sympathize with narcissistic con artists and Nazi pedophiles to make people aware the system is broken. Kinder, smarter, and more effective people are also communicating those concerns.

      People just weren’t acting on it because they assumed it would remained broken until someone came in and sorted it all out, not that someone even more broken would come on board to break it more.

      Now, we’ll see if any of those nicer, kinder people activate in any meaningful way. So far things are looking promising.

      But there’s no reason to hold hands with nationalists and fake vapors with Bannon to bring attention to the fairly obvious point that average septuagenarian representatives tend to legislate around the needs of a few wealthy financial actors against the cited and sourcable unpopularity to the public as wealth disparities balloon.

      1. I won’t disagree that far more could have been done in the US to aid people disadvantaged by globalization. However, I do have to point out that in the last 36 years there have been a total of 4 years in which the Democrats could have implemented a program to aid the people harmed by globalization. One was from Jan 1993-Jan 1995 and the other was from Jan 2009-Jan 2011. Those are the two periods in which the D’s had control of Congress and the Presidency. During the other 32 years the R’s had control of at least one house of Congress or the Presidency, if not all three. This period begins with the Reagan Administration. We know the R’s will never permit any program that might directly help the people, despite the rhetoric. Their entire focus of the modern Republican party is to “comfort the comfortable and afflict the afflicted.” The people are only to be helped by the generosity of the comfortable through the trickle down mechanism.

        Perhaps the D’s could have made a program to deal with globalization a higher priority, but except for the two periods mentioned they have been on the defensive. During both of those two periods the highest priority was health care or dealing with an economic crisis.

        As Mary keeps repeating – “We simply have to outvote them”, on a consistent basis. That includes the midterms. Both of the two periods mentioned ended when the R’s won the midterms, partly due to poor turnout of the D’s base.

      2. “This is interesting regarding the 2016 election. I’ll bet you find it surprising. I did. We need to pay attention to analysis and findings like this in order to understand and plan fpr mid-terms and how to appeal to different age groups. I’ve linked two sources to help explore this topic more deeply. The first, WaPo, is quoted below. The Brookings piece is more statistical. What’s important is the similarity of their findings. What you’ll learn by reading Brookings, is that white Millennial women were about 20 points less likely to support T than their white Millennial male counterparts. (Yes, mostly, women get voting right, IMO.) It is significant to understand that the Millennial Generation is one of the most diverse groups ever in history, so the fact that racial issues were so compelling in their voting choice is concerning especially when the majority of the white Millennial males surveyed were not economically challenged. Also note the map that shows where most Millennials live. Trying to connect the dots…for ’18.

        “…when we disaggregate the millennial vote by race and ethnicity we find some interesting things — including, notably, that 41 percent of white millennials voted for Donald Trump in 2016. Why?

        Two popular explanations have emerged post-election: 1) economic anxiety, and 2) racial resentment…. First, white millennial Trump voters were likely to believe in something we call “white vulnerability” — the perception that whites, through no fault of their own, are losing ground to other groups. Second, racial resentment was the primary driver of white vulnerability — even when accounting for income, education level or employment.”

      3. Thanks, for the linkages. I have downloaded and printed both pieces. Hopefully, I will have a chance to read them this weekend.

        I am not really surprised by the voting of the white millennials. They have been under a lot of stress since the 2008 economic crash and the subsequent depression (that’s deliberate phraseology). The period of slow growth following and economic crash is all too typical. As “This Time is Different” made all too clear. Eventually, I believe the Millennial generation will do alright. But that is not comforting during the midst of a crisis. Regardless, the depression need not have occurred and the recovery could have been much quicker, but for the recalcitrance of the R’s.

        Racial resentment being perceived as the primary driver, is perfectly understandable given the racial milieu in the US along with the high immigration. Racial, ethnic and sectarian resentment was also definitely present during the Great Depression. As I mentioned a few days ago, FDR had to contend with that during the New Deal and the War periods.

        We cannot overlook the role of automation in creating the resentment as well. That definitely has a great deal to do with the unhappiness of the white millennials and most likely the men in particular.

        An additional factor that I would like to mention is the revolution in sexual mores and the role of women that has and continues to occur. That I believe is having major impacts on many men, not only white male millennials. But I believe that is a major factor in the 20 point disparity between the white millennial men and women, which was mentioned.

        With all these factors, it is no wonder we are going through some “interesting times”. I only hope that the counter reaction to Trumpism will enable some truly progressive policies to be put in place, which will help resolve some of these problems. This again means all progressives must work to GOTV. I APPLAUD MARY’S AND ALL OF YOUR EFFORTS IN THIS REGARD.

        Adding a personal note, there are several millennials in our extended family. They are all reasonably well educated, but some have been slow to start their adult lives. Some have had difficulty with employment – yes, even in a booming location like Seattle. But all are moving ahead and will become strong, participating members of society and are civically engaged. They will contribute in different ways, some will be more economically successful than others. But economic success is not the only parameter and is ofttimes overvalued.

      4. Women, Millennials, and the Black Atlas are the foundational pillars any sane future has right now.

        It’s been a long time coming, but African Americans as a national community have proven not once, but several times that if they stand up and vote, they exert undeniable power in an election. The problem is that they’re picky about who for and when they do so, and tend to not turn out for those off year elections.

        Women, now, are kinda learning that they have a pair. It’s not the same pair as the men, but it’s a pair nonetheless. This seems to be a very slow process coming to a head, but the sooner we see more women come off the sidelines, the better. This may actually be a critical part of seeing a break in the stubbornness and obstinance that’s consumed politics.

        Millenials are the sleeper bloc right now. Individually, they’re seen as over-sheltered adults who’ve been treated like children until they’re 25, and that generally reflects the parenting that went into them. Their power and strength is the technological telepathy that is the internet is second nature to them. Millenials can communicate and crowd-source problems at incomprehensible speeds. They look at Congress like dinosaurs that belong in a museum accomplishing nothing but making giant poops at glacial speeds. Poops that Millenials know they’ll end up having to clean up, and won’t be empowered to do anything about it until some cosmic apocalypse wipes them all out. To them, a national budget crowd-sourced on Reddit is more feasible than waiting for a room full of geriatrics to stop doing nothing.

      5. Mary touches on something that I’ve been thinking and that is people counting on Millennials becoming progressive. As she stated their political orientation is evolving. An example is the Boomers. During the late 1960’s and the 1970’s the political pundits all seemed to think that the Boomers would be liberal, largely because of the evolution in sexual mores, use of pot, liberalization of social mores and the anti-Vietnam movement. Even a cursory examination of history reveals that not to be the case. Rather in general the Boom Generation became rather conservative economically and became Reagan and Bush supporters.

        While political pundits and academia continue to debate this, my personal opinion is that there is a division in the Boom Generation. This division seems to separate the early Boomers from the later cohorts. Many of the early cohorts had wrenching personal crises in dealing with the questions Vietnam raised, whereas when the later cohorts matured the draft was not a factor, so Vietnam likewise was not. Also many of those that were sufficiently privileged in the early cohorts received numerous draft deferments and did not have to personally deal with the issues of Vietnam. Some examples of this are T, Bush II, Cheney, etc. My observation has been that those who did not have to deal with Vietnam have tended towards conservatism, whereas those who did have to deal with Vietnam have tended towards progressivism. Since there were far more of them than those who did have to deal with Vietnam, the entire generation has tended towards conservatism.

        In addition to this there is the factor of the economic stagnation (stagflation) of the late 1970’s just as the later cohorts were maturing. Reagan seemed to offer the solution to that and the seeming economic recovery of the 1980’s seemed to confirm that. However, an examination of economic history reveals a different story. The stagflation was primarily due to the economic shock of domestic peak oil and the subsequent necessity of adjusting to the global oil market. Also the boom of the 1980’s was really more of a false boom, due to artificially goosing the economy with the massive deficit spending of the Reagan years. Domestic investment largely cratered during the 80’s. But that was not noticed immediately. Without going into more detail, all this lead many of the Boomers towards a conservative economic orientation.

      6. I wonder if Millennials are more conservative on economic issues and more liberal on social issues….If so, which one will dominate when they are forced to choose between the two major parties? Given the fact that 41% of the white male Millennials voted for T and that white Millennials represents 58% of all Millennials between the ages of 18-34, this should give Democrats “pause”. Fundamentally, this group is very well educated which has been hewing “left”, so there are some interesting dynamics at work here. Either way, Millennials make up approximately 23% of the total population and 30% of the voting population, therefore, they are a force to be reckoned with.

        I am curious about the impact of decisions such as ending “net neutrality” on this sector. I have no doubt that the decision to not tax tuition assistance could have been in recognition of the force of who it impacted….The same could be said for the medical deduction – which impacts a huge number of the elderly, and by extension, their children who may have to help them….

        As always, politics is so interesting and I am certain that all the “real smart people in the room” are crunching this information in time for mid-terms.

      7. We have seen that the Boomer Generation has been reasonably liberal on social issues. I did not discuss that directly because I was trying to keep my post reasonable in length. That has resulted in a great deal of social progress in the US during the last few decades. It pushed the GI Generation into becoming far more tolerant. I’m fairly confident that the Millennials will be socially quite tolerant and open socially.

        But the economic question is an open question. I do hope that the economic difficulties the Millennials have had will make them realize the dead end of the “Trickle Down” philosophy with its concomitant weakening and eventual elimination of the safety net. That combined with the weakening of economic regulation which directly led to the economic crash and subsequent depression will hopefully cause the Millennials to tilt more towards the progressive (Keynesian) approach towards government intervention in the economy. Most likely they will be cautious in their personal spending and borrowing habits as was typically the case with the GI Generation that lived through the Great Depression. Nevertheless, they appreciated the necessity of government intervention in economic matters and having a strong safety net.

        Like you say these issues were no doubt taken into account in the final Tax Bill.

    4. This guy did an analysis of Repub legislative efforts. He says:

      “So there you have it. In 27 years, Republicans have passed one popular conservative law and spent most of that time voting against things that clear majorities of Americans wanted. If they weren’t serving Americans, whom were they serving? And how have they gotten away with it?”

      So, yes, there’s something wrong with them.

      1. Republicans have cultivated the makings of an Orwellian political ecosystem for decades:

        – a self sustaining bubble of tribalism, enforced by self-created propaganda outlets and a steady stream of sycophants inventing convenient ‘realities’. Fox News was created by a major party donor for the express purpose of creating the concept of ‘conservative news’, which has acted unabashedly as an arm of the political party ever since.

        – Elected political officials who are almost unbeholden to their word, nor the vote of their constituencies. There is no principle that cannot be sacrificed for the sake of continued power. One time budget hawks suddenly sign on for massive debt inflations. ‘Evangelicals’ silently condoning sexual abusers. Rule of Law advocators attempting to undermine Federal investigations.

        – Legislation as quid-pro-quo exchanges of wealth. “tax breaks’ and ‘deregulation’ for one side, ‘donations’ for the other.

        All they really need (and want) is one more ‘payroll’ supreme court judge, the 2020 gerrymandering pass, and nullifying the filibuster. That’s really all it’d take at this point.

      2. You are correct in asserting the Republicans have been cultivating an Orwellian political ecosystem. I have often thought of 1984 with Republicans. However, I do believe they have essentially done away with the filibuster. By abusing the reconciliation rules of the Senate, they have created a situation where only minor legislation is subject to the filibuster. If they are able to get another subservient SCOTUS judge and get a successful decision on the WI gerrymandering case they will essentially be there.

      3. Reconciliation is a half step. It’s basically a freebie they’re exploiting to cram as much policy as they can through a budget process.

        It seems as though Republicans have two choices:
        – Break the filibuster so they can pass more than budget related legislation. Secure legislation that can ensure Republican minority rule wherever possible in 2020 so further gains can be passed at the state and local level to calcify their gerrymandering efforts.

        – Sabotage the entire federal government through the budget and nomination processes so they can point fingers at Democrats and blame them for how bad things are.

        Right now, I think they’re hell bent on scuttling the federal government while they can still steer it into the rocks. The ‘tax break’ bill is a clear kick back to their donors with a plea to extend their political lives against what will should be (but I doubt will be) a full spectrum run against Democrats everywhere.

  5. Off topic but FYI. Comment sections using Disqus have been down since yesterday evening. On another blog I saw this comment where we were discussing technical problems that arose yesterday.

    “not to sound paranoid, but TWO of the large scale forums I subscribe to, one for filmmaking (who openly stated they were experiencing a Russian bot attack) and one a huge academic society for a particular species of animal, have experienced weird viruses in their online platforms in the last 36 hours that have shut both platforms down. Maybe someone should start a thread?”

    Looks like “Boris and Natasha” are busy again. Alabama election throw them for a loop?

      1. Last post on tax cut (tonight (-;) Why are Repubs in such a rush to implement their tax cut plan that they would risk costly errors, voter confusion without a prudent staged implementation? Here’s one theory:

        “(GOP) Lawmakers are mostly skipping that playbook, though, as they eye the 2018 elections. They believe the combination of a dramatically lower corporate tax rate, a long-awaited repatriation of companies’ overseas earners and tax cuts for individuals will give a boost to voters heading into next year’s elections.

        Overall, under the plan, millions of people’s take-home pay would increase and businesses would have a lot more money.”

        I’m curious – Who here believes they are correct?

      2. If those millions of people are significant shareholders or are executives in the corporations, their take home pay will increase. However, if they depend on earned income they will not see a single red cent in their pay checks.

        On the other hand, businesses will have a lot more money, until they distribute it to the executives and shareholders. I guarantee the money will not be distributed to the ordinary stakeholders, such as the workers and the communities.

    1. Senate Leadership Fund CEO Steven Law: “This is a brutal reminder that candidate quality matters regardless of where you are running. Not only did Steve Bannon cost us a critical Senate seat in one of the most Republican states in the country, but he also dragged the President of the United States into his fiasco.”

      Influential GOP blaming Bannon. Yes, please do.

      Firstly, it’s fair. Bannon is responsible for getting Moore in the race. This election was supposed to be his warning shot against the Republican establishment. Now it’s become a shot in the leg against the Republican party nationally.

      Secondly, name your demons for what they are. It’s really not a coincidence, blind spot, or just unlucky that Bannon threw his support against such a weak candidate. The behaviors that Moore exhibited that attracted Bannon in the first place are the behaviors that pulled the plug on Moore’s race. Dude is unconscionable, and doesn’t take no for an answer.

      Yes that’s a sexual assault joke, but it’s also a literal evaluation of why he had to be removed from office TWICE before. The things Bannon admires are contrary to civil society.

      Thirdly, the pedophile thing tipped the election, but it tipped the election from its already natural low point — a low point it wouldn’t have been in if people already liked Moore or, damningly, Trump, better. Obscured by the pedophile thing was that the national swing is +10 Democrat, and Moore was already -10 from that swing. If he had won, only futzy political followers like us would have noticed the full +20 D swing in Alabama as an indictment of Bannonism. Now that damnation has national attention. Bannon’s name should by all means be hung over every analysis.

      And the Democrats should do it too. Running against Trump is too narrow. Running against Bannon by pointing out his support of modern history’s most unpopular president and Alabama’s first swing in a quarter century, and pointing out that he’s the guy trying to get the Republicans in office, could hopefully work out the way Pelosi hate animates the right.

      And lastly, just because. Fuck you, Steve Bannon.

      1. “And lastly, just because. Fuck you, Steve Bannon.”

        Seconded. There is so much that is objectionable about Trump and the Trumpism that has infected the GOP, but if I must name what I feel is the single most malignant and loathesome aspect, it’s the unapologetic bigotry. I use the word bigotry because it encompasses the racism, xenophobia, misogyny, homophobia, Islamophobia, etc. that Bannon and his alt-right goons embrace and Trump carelessly feeds because he gets applause.

      2. Running against T is too late. Running against the GOP tactics, agenda, and complicity should be the focus.

        Repubs are using this election to rally quick support for reaching agreement on their tax cut plan. They do not care that their plan will be bad for America and its people; they do not care that they may lose in mid-terms…they are making the calculated guess that the iron is hot, use it to get what they can….which is an abomination.

        The only thing that gives me hope here is that people are paying more attention and despite the delayed implementation of individual tax cuts and increases, it will be noticed and it will impact both the GOP further plans to cut entitlements more and influence midterm elections.

        Bannon is despicable but he is simply more visible in his awfulness. The ones I really detest are those who cloak themselves in fiscal and moral authority while they take people’s health care, and money to pay for tax cuts for the rich. In case it’s not obvious, I am talking about the black suited, sneaky self-serving members of the GOP Congress.

        I think the focus is going to be on expediting filling life-time appellate positions because even if a blue wave of sufficient size engulfs mid-terms, the court appointments will last until death and will sustain conservative opinions despite a possible loss of majority in Congress, et al.

      3. I haven’t forgotten the things you’ve mentioned Mary, but I was limiting myself to the one worst thing IMO. It provides the distraction for the base while Ryan, McConnell, et al. get ready to fleece them.

      4. Oh, no problem here, Fly. This is all such a clusterF**! that it is difficult to select any one topic. Susan Collins, John McCain, and Jeff Flake can take their self-righteous stands and pitch them. I keep looking for honor in the GOP ranks and every time, it comes right back to party over country. Every.time.

    2. I can’t believe I’m writing this, but can I add that Senator Richard Shelby promoting write in’s for Republicans wary of voting for Moore was brave. He had nothing to gain and risks the animus of his party and President. The write ins at roughly 2.5% exceeds Jones’ margin of victory.

      I can’t stand him, but that was a decent thing to do when he didn’t have to do anything at all.

      1. I’m going to be the cynic here. Frankly, I would like to believe Shelby did this out of the goodness of his heart, but I believe that McConnell’s hand is at work here. We will never be able to prove it, but I think that’s what happened. This lets the AL Repub Comm off the hook, shields McConnell from any other direct fall-out, impedes danger from losing support for tax cut bill consensus, and avoids the nasty divisive issue of dealing with an ethics investigation of a duly elected new MoC.

        Of course, I could be all wrong, but my cynicism antennas are on high alert.

      2. Excellent Mary, thank you for letting me off the hook. I couldn’t stand Shelby when he was a Democrat but thought I owed him a nod in this instance. I hadn’t considered the inside baseball that allows the State Party some distance or shielding McConnell.

  6. Ever the cynic, I choose to look at the Alabama results not so much as a victory, but something the Democrats should study the demographics involved in that victory very closely.

    48.4% of the people that chose to vote, or were allowed to vote (others have stated here that at least 1 in 6 black voters are now shut out of voting) still chose this monster, a pedophile religious fanatic. I stated before that in defense of this guy, you have to look at the background of his life, and what the value system was in place 40 years ago, and clearly, still today, in Alabamastan. That view has not changed, especially after reading the exit polling from last night.

    So, if possibly the worst possible candidate that the right-wing can present gets 48.4% of the vote, I can’t imagine how this will bode well for upcoming elections in the other backwater states , where the right-wing will present far more palatable candidates.

    Cillizza of CNN writes today that last night’s results indicate the Senate might still be able to be flipped in 2018. I simply don’t see that.

    1. There is more that is positive about the AL election than you perceive. First – Jones had to build his campaign from zilch. There was NO Democratic organization intact in AL. That situation likely exists in many deeply red states. Second – Jones’ win proves that character matters and that a clear, honest, message – one that doesn’t dance around difficult positions – matters to voters. People are tired of gamesmanship – where candidates equivocate and package every position. Jones was forthright and never wavered. This was also a strength of Bernie’s, however, I believe Jones will be a much stronger MoC than Sanders. Third, Jones built trust based upon his simple, consistent message and his track record. Minority communities – Black and Hispanic worked their buns off for him because they believed in him, and he gave them hope. Remember “hope”? And Obama? Jones was also blessed with a deeply flawed opponent in comparison to which his strength of character and record which broke through the political slough. Given the base Jones faced, this was still not enough to win without the incredible effort of his campaign, as the close finish proves. As one who has volunteered in many campaigns and run my own small campaign, I can appreciate the strategy, hard work, and moxy Jones team demonstrated. Democrats need to model this in the whole.

      People in America are sending a message, but we are also fighting an entrenched, very well organized and funded opponent. The time is right for a blue wave but we will have to work to make it happen in significant enough proportion to overcome the odds we face – which are long – but which Jones has demonstrated – not impossible. Democrats nationwide are going to say, if Jones could win in one of the deepest red states in the south, other progressive candidates can as well. Women have been leading the way – in VA and in special elections throughout the country. And, finally, there was voter turnout. Despite all the voter suppression, That is what it takes to overthrow a despotic majority.

    2. My take is somewhere in the middle of blind optimism and deep cynicism. Yes, the fact that Moore still got 48% of the vote (including a majority of white women) is demoralizing. And the fact that it took accusations of child sexual assault and pedophilia to knock batshit crazy Moore from unbeatable to just barely beatable is pretty damning about Alabama.

      But then again, no race in 2018 will be as hard as this one for Dems. We don’t need such a confluence of events to take seats in NV, AZ, or even TN (with Bredesen running).

      I kind of agree that there are very few lessons to be taken away from this race (for Dems or Repubs). Unless every race in 2018 will involve a child predator in a deep South Christian taliban stronghold, there’s little this race will teach us about strategy for 2018.

      That said, a win is a win. This makes it much, much easier to turn the Senate. And even if we don’t turn the Senate, every seat counts, and this will make it much harder for the Republicans to execute their agenda (although in fairness, I suspect Doug Jones will vote with the Repubs on a lot of issues).

      Also, there are some interesting nuggets in this race. The despiriting one is that white women voted for Moore by a large majority. The interesting one is that even in Alabama, college graduates (men and women) voted for Jones.

      Overall, a mixed bag but a win. I’ll take that any day over a crystal clear defeat.

      On a more humorous note, have any of you seen the video of Moore riding in on his horse? Even as a non-rider, I could tell he’s a piss-poor rider. And the horse agrees. She has a twitter account and it’s awesome:

      1. Keep in mind the college-goer cross-tabulation you have seen must not be broken out by race, which would change one’s sociological estimations a great deal: the nearly-error-margin unanimity of the black vote must be what puts the college graduate group over the top, because white college graduates of both genders went safely for Moore.

        On the other hand, the age-bracket cross-tabulation also gives a 30-point advantage to Jones, or more, for those under 40, nearly uniform when cross-tabulating for 18-24, 25-29, and 30-39 year olds.

        However, how does the black vote cross-tabulate with the age brackets? And how does the lead cross-tabulate against metro living circumstance? I posted a poll recently about how about half of white Millennials think discrimination against whites is “as bad as against blacks and other minorities.” This is progress over the older generation, but far more modest than a thirty-point swing.

        I think some of these questions are resolvable, but there’s a lot roiling below the data we have.

      2. Daniel-
        I did see those. But even for white college graduates, the difference in Moore support between non-college graduates and college grads was -20% (although you’re right, it doesn’t hit majority). The rest of the college grad majority came from non-whites. But if a 20% swing holds even in reddest Alabama, then it solidifies the notion that this is a predictor independent of location or other confounding factors (e.g. the argument that college grads are overrepresented in blue states which is why they vote for democrats).

        Also, Doug Jones did really well in wealthy suburban areas. Alabama’s cities have always been blue, even in the past presidential elections. But now, the suburbs are turning as well. Again, if that can happen in Alabama, IMHO that means it’s a secular trend independent of location or cultural issues. That’s a good thing, given that most of our population growth is in urban and suburban areas, with rural areas declining.

      3. WX Wall, you’re right about ol’ Roy’s riding skills.

        His stirrups are too short, he sits too far back on his horse’s back, which can cause early fatigue of the animal, and he uses a bridle with a long shank.

        A tug of the reins causes the horse pain and head-tossing to get away from the bit.

        It’s painful to watch him ride because you know it’s painful for the horse. Roy Moor is a sh!t.

    1. WOW!!!! I did not expect this. It gives me some hope.

      The big question I have is how soon can Jones be sworn in to the Senate? Can he be seated soon enough to cast a vote on the Tax Bill? I am sure McConnell and gang will try to delay his seating as long as possible and also accelerate the Tax Bill.

      1. McConnell stated early today that no matter who won, he wouldn’t seat him until Jan. ’18. Some day McConnell is gonna get his.

        There’s a photo of Moore astride his horse, Sassy (pardon the pun), and on her back rear hindquarter are the words, #MeToo. You geaux girl!

        Moore of course is calling for a recount…”Moore declined to concede, saying there were still military and other votes that need to be counted. Alabama Secretary of State John Merrill told CNN it would be “highly unusual and highly unlikely” for the outstanding ballots to change the results of the race.

        In Alabama, an automatic recount is triggered when the margin between the two candidates is under 0.5 percentage points. A candidate, however, has the option of seeking a recount if the margin is wider than that but has to pay for it, Merrill said. ” Votes still coming in and Jones count going up from current 21K lead. Of course we all know some funny things can happen in recounts…this is the deeeep south, after all.

      2. As much as I loathe McConnel, is this really more obstruction on his part or is it SOP to bring in the newly elected in Jan?

        I am extremely grateful to all the AL who turned out and stopped this dangerous embarrassment, to the people who worked to GOTV. Next year is our turn.

        One unrelated item, for some reason this site is blocking me from logging on with my iPad. I get this “you are temporarily locked out message”.

      3. It would be interesting to know how many grassroots donations people sent in from without AL to help Jones campaign. I know I am not alone in doing so. I also wonder how much Indivisible contributed through their mobilization of volunteers to make calls. And, finally, progressive women are amazing; conservative women appear stuck in either ignorance or another era – and they will be marginalized and left behind. Good riddance. Those women (mostly white) who refuse to see, who refuse to stand up for rights of their daughters, sisters, and other women, will pay a price. It can’t come soon enough.

      4. Another point to your comment, Fly. The AL Secretary of State is McConnell’s tool in not certifying the election results quickly. There is also the matter of the Moore demands for a recount…which feeds nicely into the delay process. As the WaPo points out – not only is Jones’ win going to accellerate movement on the tax bill, but it will also provide impetus for reconciliation of bill differences. The article suggests that the tilt will be even more focused on the wealthy rather than making adjustments to help the middle class. There is no discussion about yielding on SALT deductions nor medical expense deductions for chronic illnesses, nor cuts to entitlements. What I do believe this election will do is impact GOP plans to go after more cuts to entitlements in early 2018. If they do so despite what has already happened in VA and AL and in many other state houses, and IF the American people are paying attention and continue the momentum by doing the unimaginable – voting in huge numbers – they are fools. That they are pitiful is indisputable. So much damage has been done by T, the GOP, and the minions who are savaging American institutions and agencies, that it will likely take long-term control by Democrats to restore the most egregious changes. SCOTUS’ decision on the WI gerrymandering case is still not in. Our federal judiciary is being stacked with far right life-time appointees, and you can be assured that process will be ramped up asa the GOP puts its tax plan in place. That will be their only bulwork, just as it frankly has been Democrats during the T era.

      5. I’m not surprised. Sounds exactly like that shyster McConnell. No wonder the Senate has become so polarized.

        I believe that when a new Congress in organized newly elected Senators are seated immediately. But there is probably some rule in the books allowing McConnell to do this. I sure do not know all the arcane rules of the Senate. There are probably some Senate rules dating from 1789 when the first Congress was organized. Senate rules are typically not reviewed or updated, but roll over from one Congress to the next. That can be done by a simple voice vote,

    2. Not to rain on your parade too much, but this win came on the backs of black voters (increased turnout and something like 97% for Jones). White women still went 2:1 for Moore; white men were worse. I fear this wasn’t the sea change in voting patterns that we were hoping for.

      Don’t get me wrong – better turnout is always a plus, and I encourage it. But counting on minorities to save us from crazy white people every time is far from a safe bet. It’s far too easy to discourage or disenfranchise those votes these days.

      1. Bobby Llama, in my political action group, we talk about GOTV as a positive thing, perhaps the only thing that make competitive races possible in Repub states.

        My sense is that the national Dems spent time and money in Alabama getting out the vote. That’s a good thing.

        And depending upon your geography, so-called minorities are the majority in some places.

        So, GOTV.

      2. You’re right. Dems need to figure out how to appeal to white people too. We can’t just rely on African Americans, who already turnout at a higher rate than whites. I was amazed last year that white women voted for Trump over Clinton. Still kinda too shocked to understand what’s going through their minds. But at some point, we need to crack that nut.

        IMHO, it was shameful that some Dem commentators blamed African Americans for causing Hillary’s loss by not turning out. Even if the turnout was lower than for Obama, they still turned out at higher rates, with higher margins, than any other group in the Dem coalition. They were not the problem.

      3. I am in agreement with you on this, Bobo. My post was more to point out that Moore still won big among the ethnic/racial majority in Alabama. There is still a cultural sickness at work here, and I hope Dems will keep fighting it. The path to implementing their agenda is much harder if they can’t gain legitimacy among whites.

        I am loathe to frame things in such starkly racial terms, but I am at a loss to explain them otherwise. If Moore’s terrible candidacy didn’t move the white vote very much, what will?

  7. Mary,
    The Disability numbers didn’t surprise me but when you start digging like you did you see clear correlates that align poverty, education, access to health care etc. The story that got me going was one my daughter shared of public transcripts of Disability hearings. If SSA denies your claim you can seek reconsideration in court. Some of the transcripts are fascinating as are the Judges comments. Most of these cases are white men over 50 the attitude of many jurists is this is welfare for chronic poor with little to no chance of job retraining. Benefits vary by case but range between $700 and $1400 per month with the average being $1100. It is a classic “Chris” example of means tested + deserving population (white) welfare program. Not very fair or efficient but racially secure. In WV and Alabama there are law firms where this is the practice. It makes the argument for a basic income as in some states the working age male population on disability is +8%.

  8. I see many people are commenting about some kind of wealth fund, or a guaranteed income, some kind of assistance on a mass scale. I did not really know which one to reply to, so decided to post independently.

    My question is, how do we get to “there” from “here”, given the current economic and political climate. And I am not just talking in the U.S. Globally, right-wing politics is on the rise. Poland, U,K., Hungary, Germany, Turkey, Japan, Russia all come to mind, let alone Venezuela and Philippines. And I don’t mean authoritarian right-wing regimes based on identity politics, though certainly many of my examples are based on that. (Germany is clearly still left-center leaning, but the right is rising.) Most right-wing governments do lean non-socialist in economic policy.

    So in this climate of “if capitalism is good, unfettered capitalism must be better, and social Darwinism is the basis of all of it” how does the world move to a far more compassionate socialist view. How does China play into this, with their economic model, which seems unique.

    The mega and giga-corps are not going to willingly had over a chunk of the pie, nor their shareholders that have the politicians in their pockets. (Imagine the koch brothers or the Rand Paul’s of the world’s reaction to something like this)

    Countries like Norway with their trillion dollar sovereign fund based on oil revenues are incredibly rare. Just as thought exercise, can you imagine what the state of affairs would be like today in the U.S. if 125 years ago the government had made it law that oil was a national resource, and the majority of the profits would accrue to the citizens.

  9. We can spend a lot of time discussing the failures of Reconstruction, Reconciliation, Southern Strategy, trickle-down economics, offshoring jobs, tax policies and campaign finance, and still not correct any of or problems.

    Never before have I been so frightened for my country, and recent articles do nothing to alleviate it. But complaining doesn’t correct problems, so please consider this remedy developed by a former public servant from a family of entrepreneurs. Activists have identified many problems and partial remedies, but no other comprehensive reforms.

    I think our political dysfunction originated with two elements: partisanship and campaign financing. Our Founding Fathers never intended for private entities (political parties) to wedge themselves between the People and their government. Peaceful recovery is possible if legislation is passed that enables People power and politicians responsive to them.

    Professional property managers must analyze and correct real on-the-ground physical, financial, legal and social problems. The Citizens United decision prompted me to adapt my unique professional experiences to campaign finance reform. The result is draft legislation titled The Fair Elections Fund—a Whole New Ball Game©, at Several attorneys have reviewed and approved it.

    Long ago the People defaulted on a basic obligation of citizenship: funding political campaigns. That forced candidates to seek funding elsewhere and make false promises in order to get elected. When in office, they served their wealthy campaign funders, whose goals often opposed public needs. Accumulated voter outrage was inevitable and diverting blame was useful.

    This plan re-imagines the rally cry of the Revolution: “Taxation With Representation.” It funds federal campaigns with a $7.00/year tax paid by individual IRS income tax filers. Prospective candidates must obtain Supporting Signatures from 2 – 3,000 Registered Voters in each jurisdiction in order to use public funds for their campaigns. After FEC enrollment, candidates do no more fundraising. Public funding extends opportunity to more candidates and Approval Voting eliminates outliers. If favored candidates don’t gain wide acceptance or play by the rules, the popular #2 would be elected. This may simplify and expedite replacement in the event of a recall. It can be scaled to state and local elective offices.

    Representative democracy never was about getting 100% of what you want, or suppressing competitors. Those are the tactics of political parties and authoritarians, as exhibited by a government shutdown, voter suppression, and legislative obstructionism. Most people have the same basic needs (food, clothing, shelter, income, health care, education), but differ on implementation and financing. By engaging more citizens, this plan dilutes the extreme polarization that has “primaried out” calmer voices and disabled effective governing. Adding this option allows voters to choose among publicly-, privately-, or self-funded candidates. Free market participation allows candidates to maintain their honor. I would also like Electors to have Constitutional discretion without legislative or party (“super-delegates?”) constraints.

    IMHO, profit-driven intermediaries are unsuitable vehicles for ongoing public services because adding a profit margin increases the cost and/or lowers the wages. The goal of business is to gain, maximize, and retain revenue, often by denying, delaying, and minimizing service. These practices inherently undermine caring for our health (see also, the NRA), infrastructure, and planet. Contracting with businesses does make sense for specific projects, or leaseholds where the public obtains rental income and retains title and enforcement.

    The website’s Cash Flow pages illustrate that the number of individual IRS tax filers exceeds the number of Registered Voters, actual voters, and unregistered adult citizens. Thus, taxation without representation has been restored. This is a replay of historic danger. The revenue indicated does not include the $5,000 FEC enrollment fee from each candidate for each election, or free speech-allowed donations to the Fund.

    It is not my place to decide how the American people may reshape their government. This gratis effort is just a tool for them to do so. Please share you thoughts on this remedy.


    Further information on the development of this program is in my OpEdNews (free sign-up) article “ACA and Democracy in Danger.”

    p.s. I’m attending the Unrig the System Summit in New Orleans in February.

    1. All of your observations ring true, Claudia, but how do we get people who are registered to vote to vote? I agree that Citizens United and gerrymandering, voter suppression and legislative tinkering has made things worse (for Dems), but we are not getting our voters out. That’s a whole new problem, which might be helped if people felt their votes counted…Interesting concept for campaign finance reform, but how do we manage to get this concept in place without eliminating the other campaign funding gimmics? We can’t. Until we change the players in Congress, we won’t be able to change the rules. I’m ready.

  10. Why should the Democratic Party do anything for Trump voters? If all they want is a racist appeal and the 20th century back, why should liberal policy makers dilute their message for those votes? Why should any policy makers and semi-honorable politicians of any stripe want those votes? For better and mostly for worse, the die is cast. These Christian, racist, white, working class voters drew their lot in November 2016 and everyone else on Earth is going to have to live with the consequences of the lot they drew. Yes, the Democratic Party needs a economic populist message à la Bernie Sanders or FDR to go along with its cultural populist message it uses with women and minorities. And yes, the Republican Party needs to get its head out of the late 1977’s and come up with a modern Flexicurity program combined with reviving Nixon’s Minimum Income plan. That said, no one should be doing lowest common denominator appeals to racist voters.

    1. “Why should the Democratic Party do anything for Trump voters?”

      Because we need a majority. A reasonable alternative is to go after people who don’t vote, although you’ll probably find out they’re even more low-information than Trump voters, and even more easily swayed by rhetoric. Which means you won’t like the compromises the party would need to make to get non-voters to the polling booths (George Clooney or Kanye West or Oprah Winfrey as their Presidential candidate, perhaps?)

      1. I’m all for going after people who don’t vote. Yes some are probably stupid, but I would like to thing that some are just disengaged. I have read enough of Nate Silver’s writings to see that America has non-voters, registered voters, likely voters, and primary voters. It always strikes me as sad that pollsters get more accurate polls by switch from pure “registered voters” to “likely voters” that are basically “registered voters who actually show up to the voting booth”. Even if non-voters are no go, imagine how much healthier the parties would be if “registered voters” or “likely voters” showed up to vote in primaries and special elections. Right now the Republican Party to a greater extent and the Democratic party to a lesser extent select their candidates for the general election based off the preferences of a subset of a subset of voters. I don’t think the likes of Roy Moore would have had as good a chance of winning if there had been a larger primary voter foundation. The thing that drives me bats about the whole Trump Whisper point of view is that these articles seem written from the perspective that Trump voters should be gone after by both parties because Trump voters show up consistently and other groups don’t.

      1. I’m not talking about leaving anyone behind. I’m talking about recognizing that there are some groups who won’t buy what your selling even if it is probably what they actually need. Furthermore, it is hazardous to try and get said groups to buy in by peppering proposals with the garbage they want to vote for. You don’t have to leave Trump voters behind. You just have to accept that Trump voters will fight you tooth and nail until you make them take the better life they say they wanted in the first place.

  11. A columnist once described a conversation he had, as a teenager. He told his father that he didn’t see much racism. His father’s reply was “Wait till times get hard. You’ll see plenty.”

    Sure, unemployment is at a 17 year low. But what kind of jobs are we talking about? And what about the fact that almost 50% of people in this country have zero or negative net worth? These people do not view themselves as “shareholders.” They have no investment in the status quo, and have very little to lose from crackpotism of any type.

    I have always thought that not seeing the connection between economic stress and racism was a blind spot.

  12. So you’re saying Bernie would have won? 😉

    I’m only half-joking though. In your Forbes article, you say that people would be receptive to something aside from Republican neo-Nazism and Democratic patronage. IMHO, that’s what Bernie advocated. He talked about investing in infrastructure, education, and a more secure safety net (which is where I’d place Medicare-for-all). Education is a no-brainer. Better infrastructure allows our high wages to be offset by lower costs elsewhere (e.g. transportation, energy, etc). And a better safety net allows people to take the type of risks needed in our entrepreneurial, high-risk high-reward economy. How is that not exactly what’s needed to lift people from those soon-to-be-automated Carrier jobs and into the new highly skilled jobs that are being created?

    Aside from the socialism bug-a-boo, what exactly was wrong with what he advocated? Even the fear of rising deficits was overblown: nonpartisan analysis of his spending showed that his massive infrastructure plan would power a massive increase in GDP such that our debt as a percentage of GDP would stay stable or decline (which is the proper way of measuring debt). Plus, medicare-for-all would actually save the country several hundred billion dollars by eliminating the inefficiencies in the administrative overhead of private sector insurance, before even cutting a dollar from wasteful spending on medical care itself.

    Also, the real problem with all this technological advancement is, as you state, that the gains accrue entirely to a small segment of the population. This is entirely a political problem, not intrinsic to the technology. There was a time when manufacturing was the same. When we transitioned from agriculture to mfg’ering, the robber barons kept most of the gains, and manufacturing paid poverty wages, with bad health and grim exploitation. It was the last option for people who couldn’t afford land and a much more comfortable life as farmers (e.g. immigrants or domestic migrants). I’m sure there was much hand-wringing then about how are people going to survive when the relatively comfortable life of the citizen farmer was replaced by working in the mines or Chicago’s Union Stockyards. What happened was the union movement, which forced Robber Barons to share their gains with their workers.

    That’s why I get annoyed when people wonder how we’re going to keep all these manufacturing jobs. They’re asking the wrong question. The real question is: how do we enable people with only a high school (or these days, bachelor’s degrees) education to earn a middle class standard of living? It doesn’t have to be manufacturing (for the first 100 years, until the union movement, it wasn’t). It can be services or whatever. It can also be massive redistribution (a-la Chris’s basic income, or maybe Bill Gates’s novel idea of a robot income tax). Or it could be nothing and they’re left to rot. Regardless, the answer is entirely a political one, not technological.

    1. Maybe not Bernie, per se. Sanders has more baggage and less upside than a lot of his enthusiasts assume, but generally speaking, yes. An unapologetic, ranting, demagoguing socialist probably would have out-performed Clinton in last year’s election.

      I mean, if you look closely at what Trump said he was going to do, and also to what his voters *say they thought he was going to do*, you end up with something that sounds like a cross between FDR and Huey Long. A lot of it sounds stupid, like “he’s gonna get rid of Obamacare” right next to comments like “he promised we’d all have healthcare.” But beneath it all they really seem to have believed he was going to reinvigorate blue collar work, deliver an expanded safety net, and limit that safety net to only “deserving” people who are white, Christian and ignorant like themselves.

      Interesting conundrum for any aspiring socialist demogogue – How do you sell a “soak the rich” program of safety net expansion to blue collar workers unless you promise that only white men will benefit? Will they buy that program if it covers everyone?

      That’s the one potential weakness in Packer’s response to Coates. I’m not entirely sure that you can make old fashioned left wing populism work in modern America if you don’t sweeten it with a hearty dose of racism. Safety net pitches only work if people aren’t too concerned that someone’s getting a free ride. For a large percentage of those white blue collar voters, every penny of public benefit that goes to a brown family is a giveaway.

      That also helps explain why something truly universal, like a basic income, may be the only fix. When I say “universal,” I mean that it is not only detached from white nationalism, it’s detached from a concept of “deservingness.” Most basic income programs would directly benefit almost everyone at some point in their lives.

      1. And I left something out. Those basic income style programs have to be fashioned in the form of universal profit sharing, rather than just a welfare program. Think of a large version of Alaska’s sovereign wealth fund, rather than the food stamp program.

      2. I think universal profit sharing is something we should do. Index funds have proved to some extent that “virtual competition” is about as good as the real thing. Let’s get everyone in the pool.

        Obama’s economic adviser was against universal income because it’d blow up the budget relative to means-tested programs, but there could be reasonable argument that Obama and co, plus many other “establishment” Democrats, vastly mis-marked the sociology of entitlements.

        People (especially conservatives) say they want reduced government intervention in the economy, and by some metric, means-testing reduces the overall amount of distribution going on. As we know, what people say and what they want are not the same thing.

      3. For the most part I think Chris is correct regarding why T was elected. He made a lot of promises that basically sounded like “he was going to reinvigorate blue collar work, deliver an expanded safety net, and limit that safety net to only “deserving” people who are white, Christian and ignorant like themselves.”

        I would add that there was a lot of misogyny involved too. Many of the male voters were willing to ignore his obvious sexual predation, as long as he denied it. That was even true of women, after all “boys will be boys”. Plus the alternative was that “bitchy Clinton”. That is the same rationale that has been playing out in Alabama, with Moore.

        Even going back to the New Deal – it was largely limited to whites. FDR took a lot of criticism for that, but he was willing to make the accommodation, because he knew that he needed the Southern Democrats to at least acquiesce. If the New Deal programs had been clearly extended to blacks, there would have been no New Deal. Basically a sovereign wealth concept is required. Even today a person who is a minority and might be on unemployment or other governmental assistance, gets a lot more heat than someone who is white.

      4. This is really interesting data, Koctya, especially this finding: “76,156 qualified due to mental disorders (28.6 percent).”

        Given the large numbers attributed to AL, I wonder to what extent the state division that screens applicants for SS disability is competent? W VA leads and their poverty/health/opioid problems are significant, but AL? The relationship between poverty and health disability is high….That got me to thinking so I checked the US life expectancy averages by state. That socialistic state, Hawaii, leads all states in life expectancy at 81.3 years while (bottoms up) MI, W VA, AL, and LA have the lowest average life expectancy….One could argue (and many health experts do so) that poverty and poor health are intrinsically linked for obvious reasons. If you pull stats on educational attainment by state, the same states rank in the bottom with the addition of TX , CA, and Puerto Rico at the very bottom…

      5. I like the idea of “profit sharing”, but corporations will scream bloody murder about it. I was always amused about Alaskans proclaiming themselves to be rugged individualists when they literally receive a check every year from the government for doing nothing but breathing and having a mailing address in Alaska. The fact that they feel they “earned” it because a national resource (oil) that has nothing to do with them happened to be located in their state made it even harder to swallow.

        Which is my way of saying deluding the masses that they “earned” their basic income from some sort of sovereign wealth fund won’t be hard. After all, everyone feels they “earned” their medicare and social security as well, even though the SS trust fund, etc. are just accounting gimmicks to hide the fundamental truth that they are inter-generational wealth redistribution mechanisms.

        But convincing private enterprise that they should invite the government to be their 30% business partner (beyond what they already pay in taxes) will be the hard part. Which means the only way I see a basic income working is if it comes from income taxes. How would you propose creating a sovereign wealth fund, even in name only?

      6. ‘How do you sell a “soak the rich” program of safety net expansion to blue collar workers unless you promise that only white men will benefit?’

        That’s a good point, but I don’t think you have to. If you could persuade all the Obama voters who voted for Trump, you’d win the election. I actually think most people, aside from the 30% hardcore tea party / neo-Confederacy groups, have no problem with a rising tide lifting all boats. As long as, indeed, all boats are lifted.

        That is, I don’t think a white blue collar worker minds that a black person also gets a blue collar job, as long as it isn’t *his*. It’s only when we put a black and white blue collar worker together with 1 job, and say “let’s you and him fight” that they attack each other. A brutal form of musical chairs, if you will.
        (To carry that analogy further: the Republican leaves the loser to die. The Democrat still makes them fight, but gives the loser a band-aid for his wounds. A socialist demagogue asks why there’s only one chair for them when the fatcats watching and taking bets are each sitting on plush lazy-boys 🙂 )

        Part of this is that jobs are different than a safety net. If a black person earns his $500/month from working at McDonald’s that’s far more palatable than just paying him $500/month for nothing, even if he “stole” that job from a white man. So maybe part of the social safety net is a universal guaranteed jobs program? Even if all they do is sweep the streets, it makes it easier to accept giving them money…

      7. Personally I am a fan of expanding worker ownership and there are efforts afoot in North Carolina around that. It is difficult work because the concept is not well known and adopted in the US. (As such, the lack of resources is pretty profound.) Based on some casual interactions I’ve had with the folks here, one thing that becomes evident is that doing the formation and transitional work to a democratized workplace brings down political walls, builds community and roots wealth in local spaces. All that said, I recognize that most folks have voted and will probably continue to vote with their pocketbooks for the “New Economy” and this may make concepts like the UBI the only practical answer.

  13. I read a few of the Trump whisperer pieces, but I’ve come to the conclusion that if you read one you’ve probably read them all in terms of substance-only the details will vary. I personally have zero plans to engage with them politically in this coming year. That not saying that it won’t end up happening anyway, and I’ll be preparing for it (The Houston Women’s March has workshops on going for that), but I’m not reaching out to any of them as long as they make their reality-denying excuses for Trump. I’d much rather negotiate with Bernie voters and new voters and voters on the sidelines. Gotta budget time and energy. Gotta know one’s limits.

  14. Chris, read your article, and it is dead on, and I will rehash a discussion that was had on this forum some time ago, how automation benefits the owners of the capital far more than other segments of society. What happens in socially regressive countries like the U.S., when segments of the population are deemed unemployable, based on age, intelligence and/or education levels?

    What happens when the 54 year old long-haul truck drivers start getting fired if and when driverless vehicle technology starts actually working on a large scale? What happens when regardless of the lies told to them by politicians, economic and technological forces the politicians have little or no control over have made the Indiana workers obsolete? Because there is undoubtedly going to be a percentage of the world population that simply cannot function in a high knowledge job market, and there are not enough McDonalds to give them all jobs.

    I realize that socially progressive countries are going to have to start creating an minimum guaranteed income, but how will that work? When we have countries like the U.S. rolling back the safety net for the benefit of the powerful, how does society world-wide make this massive sea-change to a far more socialist society?
    And given that speed of technological change (and business to adapt those new technologies) far outstrips enormous social upheaval, what is going to happen?
    We have discussed revolution in the U.S. But what happens when we are talking about a global scenario?

    As far as I know, in the history of mankind, we have never abandoned improved technology because it hurt a large segment of the population, and I don’t see that changing. Please correct me if I am wrong.

    Mary says the poor will simply endure, as they always have. You say the poor have never revolted successfully without the leadership of the retainer class. So what happens when even larger swathes of the global worker pool are deemed useless? Will we see significant geographic parts of the U.S., something like southern Ohio, southern Indiana, and most of Alabamastan becoming like Bangladesh, assuming the attacks on the social net continue unabated (ie. The rich not wanting to share the economic pie)?

    1. Great comment. First, I’d like to point out that Alabama is already like Bangladesh, just with fewer people. And I’m not joking. Absent the role of the US federal government in filing down the edges of poverty and infrastructure neglect, it (like Louisiana and Mississippi) would be indistinguishable from Guatemala or Belize.

      As for what we should do to mitigate the impact of growing capital concentration (because that’s the only real problem with automation), a basic income remains a good idea, but perhaps an incomplete one. Another idea I’ve been seeing might complete the picture – a social welfare fund.

      Alaska already has this. All oil and gas revenues go into a fund that’s partially paid out in annual installments to residents. Combine a tax-funded basic income with a form of sovereign wealth fund specifically geared toward social welfare and you may have a society in which everyone has a stake in economic growth.

      1. As to the sovereign wealth fund, it reminds me of a thought experiment a few years ago.

        I once thought that a way to solve many social inequities would be to pay people with stock. That is, when you are hired, you get a small amount of a special non-transferrable stock that pays part of your salary in dividends. Each year you get more stock until, say, half of your salary is paid in dividends.

        There’s a lot of details that have to be specified but this solve a lot of problems. For example, if your company moves out of the country, you still get paid some of your salary. Management would have to include your dividends when ciphering the advantages in moving. If they do move you will have enough to pay for a new job hunt or maybe retire. It creates incentives in a lot of ways to keep a company producing and allowing the employees to benefit. Incentives for the worker and also for management.

        I won’t go into all of the ways it would incentivize everyone to do the right thing. Because it will never be considered. First because it would be a hard sell (complicated) and second because it’s probably too late. So I’ll leave it to you to imagine the details, if interested.

        It seems the wealth fund will accomplish many of the positive aspects of my scheme in a simpler way and therefore be easier to sell.

      2. unarmed-

        How do people eat for the first few years under your plan, when they’re not being paid cash wages?

        What you’re proposing is essentially a forced savings mechanism. Taking a part of your salary and investing it (whether it’s in your own company’s stock, or say an index fund, or even 30-year treasuries). The problem is when you’re paid so little (or, for you conservatives, if you’re not disciplined enough), you can’t spare any money to save. It’s not like people don’t understand that they need to save money. They just can’t / don’t.

        There are some corporate IRA plans which will match your contributions dollar-for-dollar. IOW, you’ve doubled your investment on the first day you put it in. And it’s tax free to boot. Yet there are people who don’t max out their IRA contributions. Forcing people to be paid in stock will either lead to revolt, mass starvation, or people selling their stock for cash anyway.

      3. WX Wall –

        On the surface the employee would not see any difference in their paycheck. In the beginning, salary would mostly be cash. So the plan is that, again, it’s special, NON-TRANSFERRABLE stock. The stock has no value except for it’s dividends. So if you work a month and get fired or quit your stock will pay “dividends” of a few insignificant dollars per week. If you work for 30 years and retire you will get a significant paycheck until death.

        That is why there are incentives for long term survival of the company.

        And just because this type of stock hasn’t been issued before, doesn’t mean that it couldn’t be defined and issued. For example, I believe Alphabet(Google) recently issued a class of stock that doesn’t pay dividends but maintains control for the founders.

        Do you consider me a conservative? Usually, when I start explaining it, I get called a communist.

      4. The unarmed plan – It would be more fine-grained than a wealth fund. I imagined it as a device to remove the contentious atmosphere between management and the worker. After all, it is a profit sharing scheme and higher productivity means higher salary for everyone. Since management would also be paid salary in the same manner, decisions would be weighted toward the long term instead of toward the quarterly report. If an industry went offshore, former employees would still share in profits.

        And it still does not guarantee that a company or an industry will last forever.

        Again, I consider it too late for a scheme like this. The world is changing too fast for a sharing plan that depends on longevity of the company and the actual employment of humans.

      5. unarmed-

        Thanks for the clarification. However, what you describe now sounds more like a defined benefit pension plan, except one that pays out from day 1 instead of when you retire. DB pensions already work like that: companies set aside money which gets invested to provide a steady payout when you’re no longer with the company. While you don’t see it as part of your paycheck, it generally gets accounted for as a salary cost (just like other benefits e.g. health insurance). Even in terms of ownership it’s the same: having nontransferrable stock that’s worth zero is basically not owning anything except for whatever income it generates. Same thing with pensions: you don’t own the stocks in the pension fund (the company does), but you have an ironclad, contractually negotiated claim on the returns those assets generate.

        The main difference between your plan and a pension plan is that yours pays out even if you leave in a few months (albeit a small amount), and that’s the doozy: pension plans are only viable because of the expectation that they can compound their gains over decades before having to pay out.

        Let’s say you earn $40,000/yr, and if you leave in 1 year, under your plan, you’ll be entitled to, say, $1,000/yr for the rest of your life. That allows you to have an average working life of 40 years and retire with annual payments of $40k/yr (each year of work @$40k earns you another $1k payout).

        Assuming an average return of 5%/yr (most pension investments have to be quite conservative), your company would have to invest $20k to pay out your annual payments. That’s a 50% increase in their salary costs. Or conversely, you would have to take a 50% salary cut to set aside enough money for that annual payment.

        Regardless of how you structure it, the bottomline is that you (or your employer; makes no difference) need to put aside a staggering amount of money to have a decent annual income from your capital alone. The only way to mitigate that is through the power of compound interest, which is why retirement funds payout when you’re 65, and everyone is encouraged to start saving early.

        P.S. Sorry, didn’t intend to imply your were conservative; that was just an aside for other readers who may be conservative, since a tenet of many conservatives is that poor people stay poor not necessarily because they don’t earn enough but due to bad habits such as spending all their money on frivolous things and not saving enough 🙂

      1. I look at articles citing “shareholding” like Noah Smith’s and gotta smile. I have to believe that the oligarchs’ favorite flunkies are already writing ads attacking redistribution and socialism. Because let’s face it: if the Federal Government doesn’t do it, it won’t happen. And there’s no chance that the oligarchs are going to sit still while that’s happening.

      2. This article explores that very concept – that government regulations are already advantaging those at the top. The wealth divide is fact. Now Congress is doubling down on this problem with their tax cut plans. I have long stopped believing that we are looking at tax reform, merely more cost shifting (to those at the bottom) with the advantage accruing to those at the top…again.

      3. Chris-

        From a macroeconomic perspective, a sovereign wealth fund invested in domestic stocks is no different than a tax plan. Look at it this way: the fundamental reason to own a stock is to share in the profits of the company through dividends (capital appreciation through stock price inflation is relevant only if you plan to sell shares frequently, which the federal government wouldn’t). That’s the only way you or I can get a piece of, say, Apple’s profits.

        But the federal govt doesn’t need to own shares. It can tax Apple. So what’s the difference between the government owning 10% of Apple’s shares and collecting 10% of their dividends, and taxing Apple 10% on their dividend distributions (which we used to do)?

        The only difference is that when the fed govt spends a few trillion dollars buying those shares, it will cause a one time massive pop in the stock market, which will lead to a one-time payout of billions of dollars in fees to the dealers who execute the fed’s transactions, and to the insiders who can front-run the govt’s purchases. Which is why Wall St was salivating at the idea of privatizing Social Security. Aside from that, economically speaking, there is no difference. And taxing is more reliable because Apple unilaterally sets its dividend payments each quarter, whereas the fed controls the tax rate.

      4. No, the difference is huge, as huge as the value of owning capital rather than earning a living from labor. Ownership matters enormously.

        First of all, hardly any of these giants of tech expansion ever issue a dividend. Most of the wealth is tied up in assets more or less permanently. We already tax capital gains, which should in principle accomplish what you’re describing, but that fails. It only produces revenue when the owners make a particular choice – selling their stock under income-generating conditions. Major capital owners can go through a lifetime never doing that.

        Having a sovereign wealth fund with an ownership stake in capital markets would be a revolutionary development, which is one of the reasons we’ve never done it.

      5. Chris-
        I have to disagree. There is a difference between de facto and de jure ownership. De jure ownership is based on a legal paper which says you’re the “owner”. De facto ownership is about whether you actually control the asset. For private individuals in a society that enforces property rights, they’re the same thing. So if I own a property, I, and I alone, am entitled to the rents from that property. If a mobster can come by and force me to give him some of those rents, then I may still be the de jure owner, but I’m only partially the de facto owner. The mobster has no de jure rights but de facto is a partial owner. Well, the govt is that mobster 🙂 And just like mobsters don’t waste cash buying the businesses they shake down, neither does the government have to in order to have de facto partial ownership.

        As a non-mobster private individual, I absolutely want to get to the point where I own enough assets (de jure and de facto) that I can generate enough income where I don’t have to work anymore.

        But the government is not an individual. It doesn’t have to own anything de jure to enforce claims on them. The govt doesn’t own me, but it still forces me to share 30% of the value of my labor with them. Even with land: to collect rents from a building, I as an individual have to buy it. But the government can merely tax the rents. Heck, it can even dictate the uses of the land through zoning. If I want to expand my backyard to have more patio space, I need to buy my neighbor’s property. But the government can (and often does), tell a developer that they’ll get 10 extra stories on their skyscraper zoning application if they set aside part of that land as a public park.

        Look at it from the other perspective: If I could walk up to Apple and simply demand 10% of their profits, why should I bother with owning their stock? What does ownership get me that I can’t already get if I had the power to enforce my own personal “tax”?

        You mentioned capital gains. Like you said, the govt shares in this as well with a capital gains tax. The fact that this tax is only levied at sale is, again, a political decision. There’s no reason why the govt can’t decree that you have to declare the current market value of your assets each year (so-called mark-to-market) and pay a proportional tax. After all, that’s what regular people have to do with property tax (and it’s usually far easier to determine the market value of stocks than it is a house). The fact that capital gains are allowed to accrue tax free for years or decades is just one more sop to capital owners vs. labor; if I gain capital appreciation in a year, I can keep it invested tax free. But if I earn wages but don’t spend them, I don’t get to invest them tax free. I have to pay tax the year it’s earned.

        Are there places where SWF work? Yes, and they all share unique characteristics that we don’t.

        1) Most SWF are created from exploiting natural resources like oil. This is because countries know that the oil will run out one day. So they understand they need to save some of their current earnings for the days when they no longer have those earnings (sort of like individuals facing retirement). OTOH, if oil was a renewable resource which can go on forever, there’s no need for a SWF: just spend each year’s earnings, don’t go into debt, and you’ll be fine.

        Singapore is the only country with a SWF that isn’t based on a limited resource, and they have it for 2 reasons:

        2) They want to diversify their economy. They know they’re hugely dependent on commerce, trade, and finance (specifically Asian commerce, trade, and finance), and they want to have stability from the ups-and-downs of global trade.

        3) They are such a small economy that they don’t think they can invest all of their money domestically, and so they want to invest internationally. Since their taxing authority doesn’t extend internationally, they must of course buy assets on the open market. (e.g. the US govt can share in the rents and capital appreciation that a building in Chicago generates, but if it wishes to do the same with a building in London, it has to buy it).

        Our economy is not dependent on a limited natural resource, it is well diversified already, and there’s plenty of assets to harness domestically that we don’t need to look to international assets.

        Even *with* those conditions, I’d argue most SWF have minimal value. Every middle eastern country is setting up a SWF, except for one: dubai. Dubai is also facing the end of oil, and it could have easily set up a SWF. Instead, it invested that excess cash in its own economy, and is reaping much bigger rewards.

        Think of it this way: say Dubai has $10 bil excess cash from its oil. It could create a SWF and invest that money overseas in United Airlines, and earn the 10% in dividends + capital gains that UA generates annually. Or, it could spend that money creating its own airline, which is what it did. Now, in addition to the 10% return, Emirates employs thousands of people in Dubai, and is also enabling Dubai to become a tourist and business mecca.

        Similarly, they could have invested in London real estate, buying trophy office buildings that generate 5% return, or they could build their own trophy buildings like the Burj al-Arab hotel and the Burj Khalifa skyscraper, which generate the 5% return plus the knock-on effects of having that investment locally. Dubai understood that instead of allowing your money to power investments in other countries, it’s far better to spend it wisely in your own country.

        Does Dubai have a SWF? No, but it’s getting far better long-term returns on the money it spent on itself than any SWF has done. In just 20 years, they’ve essentially created an economy from scratch that doesn’t rely on oil at all, while increasing their citizens’ standard of living. In this regard, they’ve done far better than Norway or pretty much anyone else with a SWF. Who cares that they don’t own shares in Apple?

        My cynical bent for why SWFs are popular all of a sudden is 2 reasons:

        1) For governments, it eliminates the hard work of deciding how to invest wisely in their own country. It’s much easier to buy a million shares of United and go golfing for the rest of the afternoon, then figure out how to start your own airline.

        2) Wall St loves it because they get to siphon money off that SWF, both in transaction fees and consultation fees (plus illegal front-running, insider trading, and everything else that supposedly never happens…).

        Neither is a good excuse for us to start one. We could easily sink $10 trillion just into infrastructure in our country without having to resort to building bridges to nowhere or ghost cities, and it would generate far more returns for the average person than a Wall St-controlled SWF/slush fund. Or did we the people never learn the lesson of the Social Security trust fund?

      6. 3) It gives governments influence over corporate decisions, including decisions over how value in a firm is recognized (dividends?, buybacks?, special deals for preferred shares?, mergers, reinvestment, leveraging, bond issues, and on and on and on. Leave out ownership, and you’re just another income earner, subject to the same manipulations as anyone else on the street, including small shareholders.

        Ownership makes an enormous difference in influence, one that cannot be simulated with taxes. That’s why the US political system has made govt ownership of corporate shares an unspeakable taboo while income and capital gains taxes are the norm.

      7. “Ownership makes an enormous difference in influence, one that cannot be simulated with taxes.”

        Now who’s the socialist? 😉

        I agree with you that ownership can exert enormous influence beyond just sharing in profits. But like Creigh, I’m not so sure we want that type of influence available to the govt. Most SWF are passive investors. What you propose is something more akin to state owned enterprises or nationalized companies.

        Even as a Bernie supporter, I don’t know if we want to go down that route. While in the theory, the govt *could* use its influence to force companies to make better long-term decisions, etc. It *could* also use it for short term priorities.

        For example, if we had a SWF it’s entirely possible that when Obama was elected, he would have invested in democratic-leaning industries like Silicon Valley, and divested from republican companies like oil companies. Then, when Trump gets elected, he’d swing the other way, pull money from Apple / Google / etc and pour money into otherwise bankrupt coal companies, just to satisfy his campaign promises. That’s not a great way to manage an investment fund nor manage your country’s largest companies. Presumably there would be an independent board to manage the fund, but striking the right balance between independence and ensuring they serve the public is tricky (witness the wranglings over the Federal Reserve).

        P.S. Speaking of the Feds, we actually have a stealth SWF already: during the financial crisis, the Fed ballooned its balance sheet and bought mortgage-backed securities from Fannie Mae and Freddie Mac. The Fed is now the proud owner of ~$1.7trillion home mortgages, about 1/3 of the market for conforming home loans. That’s not the same as actually owning the houses, but it’s still a form of ownership.

        FWIW, IMHO, this was a SWF done right: the Fed bought them on an open market using consistent, open standards, exercises no actual control (the bank that gave the original loan continues to service it), and passes on its earnings back to the Treasury. Last year, that was nearly $100billion (although that includes earnings from its other investments including Treasuries, which is a little circular :-), which nearly equals the combined profits of every American bank.

        That’s a larger SWF than most SWFs out there. However, it’s temporary, and it was started for purposes other than generating income (mainly stabilizing the housing market). But it’s an interesting experiment nonetheless…

      8. That is a most interesting read about pension fund influence. The article was silent on the precariousness that many public pensions face but those whose balance sheets are strong seem to be flexing their muscle. Who can say if this will be more “good” than “bad”?

      9. That’s true. Pensions like CalPERS are huge, and they frequently set investment standards that other pension funds (including private ones) follow.

        That said, public pension plans are a problematic example because they get rolled so frequently by Wall St. It’s a common belief on Wall St. that the smartest people live on the sell-side (i.e. the people who sell stocks) while the absolute dumbest people, who couldn’t hack it in arithmetic nevermind the complicated models used in modern financial engineering, live on the buy-side, especially institutional money, which is viewed as just one step above retail investors in sophistication. While they may be exaggerating to puff themselves up, pension funds are usually considered dumb money.

        The financial site has done an excellent series of articles (now spanning years) on how CalPERS has essentially been captured by private equity interests, and have been incredibly poor stewards of their money. Despite being massive, rather than use their weight to force the private equity industry to provide better value, they meekly accept incredibly one-sided deals that essentially allow their PE and hedge fund “partners” to siphon off returns that should be flowing to the pension fund. Frequently, it’s clear they don’t even understand (or don’t wish to understand) the terms of the deals they’ve signed.

        A few recent articles just from the past month:

        Whenever you hear of a company going bankrupt, it’s usually a pension fund holding the bag on the other end, not the bank who sold to the greater fool long before then. On balance, they should probably be restricted to buying treasury bonds and index funds, just like retail investors…

    2. I’m more and more coming around to the idea of a robot income tax. If robots generate revenue like human workers, why not tax them for the common good as well? Although corporations don’t pay their robots the way they pay their workers, that’s just an accounting peculiarity. We make companies pay taxes on their employees all the time (e.g. payroll taxes).

      A robot requires significant social services just like a human (e.g. a stable electrical grid, good robot “health care” i.e. repairmen, a safe community so that burglars don’t steal (kidnap?) valuable robots to sell for parts, etc.). In the case of autonomous truckers, they require much better roads than a human driver. We should tax them just like any other productive member of society, and use that money both to provide a safety net for their fellow human citizens and provide the services they need (like the aforementioned better roads, and… maybe subsidize the education of robot technicians like we do doctors? Maybe a retirement plan that guarantees safe, environmentally sound recycling when their productive life is over? :-))

      Heck, when we start thinking of robots as autonomous agents, we’ll realize we currently treat them as slaves, corporations as slave owners, and we humans are the poor whites trying to compete with slave labor.

      1. A sound enough idea on paper, though let’s add one little caveat to it in that we shouldn’t tax any robots that have an AI installed, at least until we have a plan in place that doesn’t land us into a post-apocalyptic robotic hellscape.

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