The Friedmanite perspective greatly underestimates the institutional prerequisites of markets. Let the government simply enforce property rights and contracts, and – presto! – markets can work their magic. In fact, the kind of markets that modern economies need are not self-creating, self-regulating, self-stabilizing, or self-legitimizing. Governments must invest in transport and communication networks; counteract asymmetric information, externalities, and unequal bargaining power; moderate financial panics and recessions; and respond to popular demands for safety nets and social insurance.
In this regard, I think it’s quite interesting to read historical, anthropological, and sociological accounts of state formation and people living in non-state social orders. It’s common to represent the market as in some sense “given” and the state as a kind of positive presence against the market backdrop. But that’s not how any actual society seems to have developed. Instead, property rights and contract enforcement evolve in parallel with other elements of the modern regulatory and welfare state. Even something as fundamentally free markety as the floating exchange rate of the dollar is much newer than Social Security or the National Labor Relations Board, to say nothing of public schools.
Demand for new infrastructure, office, retail and living space is currently not being met, but with Federal and local laws preventing the demolishing of historic buildings, and height regulations limiting new structures to eight stories, the only solution is for architects to build downwards.
The only solution? How about the city government designates a set of aesthetically valuable historic buildings and then lets the rest of the land be filled with tall modern structures to meet the demand for space? That sounds like it could be awesome. Living underground is a dystopian scenario for when the surface of the earth becomes uninhabitable, it shouldn’t be a go-to response to a regulatory mandate for short buildings.
In an exclusive interview with the Weekly Standard, ironically headlined “Cain Rips Obama’s ‘Dumb’ Foreign Policy,” the GOP presidential hopeful blamed President Obama for an Iraq policy resulting directly from decision made by by the George W. Bush administration. Cain first complained that Obama was telegraphing U.S. withdrawal from Afghanistan, then said he was “doing the same thing in Iraq“:
We’ve got 43,000 people still left over there. The Iraqis are making good progress with the help of those 43,000. So what does he do? He goes off and says we’re going to by the end of the year pull out 40,000 troops. I’m sorry if this is not politically correct, but that is a dumb thing to do.
Cain’s analysis here leaves out two crucial factors: that the deal to withdraw American troops from Iraq by the end of 2011 was made by the Bush administration in 2008, and that any change in that agreement would need to be acceded to by the government of Iraq.
The 2008 Status of Forces Agreement (SOFA) (PDF) signed by the Bush administration and approved by Iraqi Prime Minsiter Nouri al-Maliki’s government says explicitly:
All the United States Forces shall withdraw from all Iraqi territory no later than December 31, 2011.
When the framework was signed, in fact, many critics wondered if Bush, in his last year in office, was tying the hands of a future administration to decide the course of the Iraq war on its own. But for all the American objections, the 2008 Bush-Maliki agreement did have something going for it that Cain also seems to ignore: that the Iraqi parliament agreed to it.
The sticking point in the decision to keep American troops in Iraq beyond 2012 or not was, again, something that a sovereign Iraq had a say in. Indeed, the New York Times reported this morning (as early hints had indicated) that the Obama administration’s decision to abandon plans to keep thousands of troops in Iraq was a result of the Iraqi government’s refusal to grant those troops immunity from Iraqi law — a operational condition the Pentagon said was unacceptable.
With the common GOP refrain that Obama needs to listen to his generals — Cain told the Standard he “would have asked the commanders on the ground” about Afghanistan — one wonders why, in the case of Iraq, Obama’s critics don’t recognize that he listened to the Pentagon about the necessity of immunity. Instead, they’re pinning Obama’s complete acquiescence to the Pentagon’s views, and restraints imposed by Bush’s SOFA and al-Maliki’s government, on the White House.
David Brooks’ column “The Thing Itself” is just begging for a Straussian reading of some kind. It’s a very distinctive phrase, derived from Kant, and Kant’s point about the ding an sich is that it’s unknowable and inexpressable. The precise concept is a bit difficult (though I think well captured by Wallace Stevens’ view that “things as they are / are changed upon the blue guitar”) but the basic idea is that there’s no way to see things except through the veil of perception. Anyways, Brooks:
It would be nice if there were more leaders like Ward inclined to disenchant problems and stare directly at specific contexts. Sometimes circumstances compel you to raise taxes, sometimes circumstances allow you to cut them. Sometimes government can promote innovation; in most cases it can’t.
Walker Percy once wrote, “God writes straight with crooked lines.” Translated into policy terms, that means it takes a lot of little zigs and zags over the terrain to get where you want to go. Mayors, governors and local officials do this all the time as they respond practically to circumstances. At the national level anybody who tries to zig and zag gets regarded as weak and traitorous by the economic values groups. There are rewards for those who fight over symbols, few for those who see the thing itself.
The basic topic of the column is perfectly plausible here. A call for people to be more practical. But why link that idea specifically to Kant’s phrase, and then use it to call for us to do something that Kant says is impossible? I get a distinct air of Leo Strauss and the University of Chicago around this. Brooks is winking at those of us in the know to signal to us that there’s a deeper meaning afoot. The esoteric argument, I think, is that people necessarily engage with mass politics on a symbolic and expressive level rather than a practical way (voting isn’t very practical) so our endeavors are doomed to failure.
Romney’s Raised More Than Five Times As Much Money From Wall St. Employees As Obama |
According to a New York Times analysis of campaign donation data, 2012 GOP frontrunner Mitt Romney has raised more than five times as much money from the employees of major Wall Street firms as President Obama. The Times found that “Mr. Romney has raised $1.5 million from employees of firms like Morgan Stanley; Highbridge Capital Management, a hedge fund; and Blackstone, a private equity firm. Mr. Obama has raised just over $270,000 from firms that were among his leading sources of campaign cash in 2008.” Goldman Sachs employees have given Romney $350,000, compared to $45,000 they’ve given to Obama.
The one-time “paper of record” cut coverage sharply since its peak in 2006 and 2007 and failed to connect the dots — heck, a headline this week even blamed the recent record-setting Thailand floods on Thai “officials” not “an unusually heavy monsoon season”!
Yet the paper never mentions the collapsing media coverage in the Elisabeth Rosenthal article that takes up nearly the entire front page of the Sunday Review asking (subhed in print edition):
Across the nation, too, belief in man-made global warming, and passion about doing something to arrest climate change, is not what it was five years or so ago, when Al Gore’s movie had buzz and Elizabeth Kolbert’s book about climate change, “Field Notes From a Catastrophe,” was a best seller.
So media coverage collapses and public concern for the issue drops a bit. Go figure!
But the ace investigative reporting team at the Times doesn’t seem to believe the sharp drop in media coverage merits even a single sentence in a piece on why the issue of climate change has faded somewhat.
Dr. Robert J. Brulle of Drexel University, whom the NYT itself quoted in 2009 as “an expert on environmental communications,” emailed me:
A major factor not mentioned in this article is the collapse of any significant coverage climate change in the media. We know that 2010 was a record low year, and 2011 will probably look much the same. If the media doesn’t draw attention to the issue, public opinion will decline. The media effects literature clearly shows that the public takes cues on concern over issues from the levels of coverage in the press. So perhaps an interview with the editors of the NY Times and why coverage of climate change is declining and is having its predictable effect on public opinion on this issue.
There are a number of flaws and ironies in the story. Rosenthal writes:
Herman Cain has stumbled into a number of foreign policygaffes. But in a Meet The Press interview with David Gregory, Cain found himself revealing that his foreign policy vision is largely formed by neoconservatives while claiming that he was “not familiar” with the neoconservative movement. The exchange read:
DAVID GREGORY: What about foreign policy advisers? Who has shaped your view on the U.S. in the world and foreign policy?
HERMAN CAIN: I’ve looked at the writings of people like Ambassador John Bolton. I’ve looked at the writings of Dr. Henry Kissinger, “KT” McFarland, someone who I respect.
GREGORY: Would you describe yourself as a neoconservative then?
CAIN: I’m not sure what you mean by neoconservative. I’m a conservative, yes. Neoconservative, labels sometimes put you in a box. I’m very conservative.
GREGORY: But you’re familiar with the neoconservative movement?
CAIN: I’m not familiar with the neoconservative movement. I’m familiar with the conservative movement and let me define what I mean by the conservative movement. Less government. Less taxes. More individual responsibility.
Watch it:
While Cain may choose not to identify with neoconservativism, two out of the three individuals listed by Cain as shaping his foreign policy views are closely tied to the neoconservative movement.
One was John Bolton, a senior fellow at the American Enterprise Institute who briefly served as U.S. ambassador to the U.N. under the George W. Bush administration. Bolton promotes many neoconservative policy positions, and served on the board of directors for Project for the New American Century, a neoconservative pressure group which openly pushed for war with Saddam Hussein’s Iraq since 1998.
Both Bolton and McFarland have embedded themselves within neoconservative institutions in D.C. In John Bolton’s case, this included advocating for an aggressively hawkish foreign policy at every turn. The lack of familiarity with neoconservatism could stem from Cain’s ignorance of foreign policy or perhaps it’s a savvy move to distance himself from the movement that spearheaded the campaign to start the unpopular Iraq war. But looking at those who inspire his worldview, Cain’s foreign policy seems to clearly lean into the neoconservative camp — whether or not he understands or admits it.
Justice Thomas Accepts A $15,000 Bust As A Gift From A Corporate-Aligned Think Tank
In an interview with Meet the Press’ David Gregory this morning, GOP presidential frontrunner Herman Cain endorsed Justice Clarence Thomas as a model a President Cain would follow in making appointments to the Supreme Court:
GREGORY: What about the Supreme Court? Who’s your model of the ideal Supreme Court justice who you would appoint?
CAIN: I would say that there are several that I have a lot of respect for. Justice Clarence Thomas is one of them. I believe that Justice Clarence Thomas, despite all of the attacks that he gets from the left, he basically rules and makes his decisions, in my opinion, based upon the Constitution and solid legal thinking. Justice Clarence Thomas is one of my models.
Thomas accepted lavish gifts from wealthy benefactors and even from corporate-aligned interest groups with business before his Court. Leading conservative donor Harlan Crow, whose company often litigates in federal court, provided $500,000 to allow Thomas’s wife to start a Tea Party group and he once gave Thomas a $19,000 Bible that belonged to Frederick Douglass. The American Enterprise Institute (AEI), a conservative think tank which frequently files briefs in Thomas’ Court, also gave Thomas a $15,000 bust of Abraham Lincoln as a gift. This last gift is particularly egregious because Thomas continued to sit on three cases where AEI filed a brief.
Significantly, a justice was forced to leave the Court for a very similar gifting scandal. In 1969, Justice Abe Fortas resigned in disgrace after the nation learned that he had accepted tens of thousands of dollars worth of gifts from corporate executives and other wealthy benefactors. Justice Thomas, by contrast, remains openly defiant at the mere suggestion that he has done anything wrong.
Sadly, however, Thomas’ many ethical lapses are not even the most disturbing part of his tenure as a justice. In three separate cases — U.S. v. Lopez, U.S. v. Morrison, and Gonzales v. Raich — Thomas claimed that the constitutional basis of national labor laws and most national civil rights laws is “at odds with the constitutional design.” It’s difficult to count how many laws would simply cease to exist under Thomas’ vision of the law, but a shortlist includes the federal ban on workplace discrimination, laws protecting older Americans and Americans with disabilities, the national minimum wage, national child labor laws and the federal ban on whites-only lunch counters.
Given Cain’s long history of confusing the Constitution with a Tea Party manifesto, it’s not surprising that Cain wants to see more Clarence Thomases on the federal bench — but it is still deeply disturbing. One ethically challenged justice eager to repeal the Twentieth Century is too many.
This Washington Post piece about America’s gigantic unmet infrastructure needs is pretty good, but in some ways I think it misses the obvious. The reason we don’t spend more money on infrastructure projects is that we have a gigantic Department of Defense, an escalating government tab for health care, and a refusal to raise taxes to accommodate that health care tab. Consequently, everything else is getting squeezed out.
“All of the numbers are so gargantuan large that they’re useless when you’re trying to communicate with the public,” said Roy Kienitz, undersecretary for policy at the Department of Transportation.
The American Society of Civil Engineers has estimated that an investment of $1.7 trillion is needed between now and 2020 to rebuild roads, bridges, water lines, sewage systems and dams that are reaching the ends of their planned life cycles. The Urban Institute puts the price tag at $2 trillion.
That’s a lot. And of course common sense tells you that the American Society of Civil Engineers is perhaps going to overestimate the objective need to spend money on civil engineering projects. But this is comparable to what we dropped on Iraq with no return whatsoever. Conversely, what if taxes were higher? Having a home mortgage interest tax deduction gives us more “private infrastructure” in the form of big houses and less “public infrastructure” in the form of speedier commutes. At some margin the “worse commute, bigger house” social tradeoff may be worth making, but it’s difficult for me to accept the view that a paucity of large homes is one of America’s leading problems at the moment.
The 99 percent movement protests are going global as more and more people seek to register their frustration with corporate greed and injust economic policies. Preferential tax treatment has helped drive the U.S. to its worst level of income inequality since the Great Depression, with the nation ranking more unequal than the Ivory Coast, Ethiopia, and Pakistan. Since 1979, “the gaps in after-tax income between the richest 1 percent of Americans and the middle and poorest fifths of the country more than tripled.”
America’s recognition of the indisputable level of inequality is forcing Republicans to back away from their condescending treatment of the “Occupy” protesters. Once concerned about these “growing mobs,” House Majority Eric Cantor (R-VA) is making an about-face. Today on Fox News Sunday, he told host Chris Wallace that the president and Republicans “agree that there is too much income disparity in this country.” Pointing to the public’s “complaint” about the unfair economic playing field, he insisted that Congress should rely on America’s wealthy “to take care of income disparity”:
CANTOR: We know in this country there is a complaint on the folks on the top end of the income scale that they make too much and folks on the end don’t make enough. We need to encourage those on the top income scale to create more jobs. We are about income mobility and that’s what we should be focused on to take care of the income disparity.
Watch it:
Relying solely on the wealthy to reduce income inequality seems woefully out of touch with reality. Numerous corporations are sitting on enormous profit, paying more to their CEOs than in taxes. Last year, CEO salaries increased by 27 percent while private worker wages increased by only 2 percent. This pattern will hardly help address the disparity.
What’s more, any concern that Cantor and Republican lawmakers have about income inequality seems to be about maintaining it. Cantor voted to make the Bush tax cuts permanent, tax cuts that “actually increased economic inequality by delivering more than half of their benefits in 2010 to the top 10 percent of earners, who make over $170,000 a year. In fact, 38 percent of the dollar benefits went to the top 1 percent of earners.” He champions (and co-sponsored) a reduction in the capital gains tax, another policy that helps drive income inequality.
These are just a few of the many positions — including promoting tax increaseson the middle class while protecting the preferential treatment of the wealthy — that have driven the disparity he suddenly seems to care about. There’s no question that inequality is in need of attention, as increasing income inequality effectively suffocates economic growth. But if Cantor is serious about addressing this issue, he’ll have to change nearly all his policies to do it.
