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Friday, October 8, 2010
 The path Left lies through the Pentagon

Topic: Semi-random Thoughts

I've come to the conclusion that the most effective way forward for a "leftist" movement in America is via opposition to the wars in Iraq and Afghanistan, and to the military-industrial complex in general.

Multiple reports, including Bob Woodward's new book, Obama's Wars, and the Rolling Stone article , The Runaway General, have recently painted the picture of a White House run by the military.

Statements from top military leaders, including Secretary of Defense Robert Gates and General David Petraeus have indicated that the military has no intentions of leave Afghanistan any time soon, or possibly ever.

Woodward quotes General Petraeus as having said "This is the kind of fight we're in for the rest of our lives and probably our kids' lives", and Roberts Gates as saying "We're not leaving Afghanistan prematurely. In fact, we're not ever leaving at all."

The case can easily be made that military spending is way, way out of control, and the thing is, the majority of Americans realize this. Not only that, but there are even factions within the Tea Party movement, many of the libertarians, who are opposed to America's military spending as well.

Opposition to the war and to the military-industrial complex in general is a movement that can garner a lot of public support from across the political spectrum and across age groups. There are actually a lot of seniors who are dismayed about the state of the American military engagements. And by going after the military budget that's what frees up the spending to secure domestic spending.

I think that this is the issue that the left needs to coalesce around in 2011. Right now its too close to the current elections to do much on the issue, and then we have the holidays, but starting with the new year there needs to be a real vocal movement of opposition to the war in Afghanistan and to the role of military leadership in general.

It is the reality that America's civil government has been taken over by the Pentagon. It is the case that civilian leadership is not longer driving the ship, the military is. This is the case that we need to be making. The military is driving the country to bankruptcy and ruin. The military is now a threat to America's long-term well being.

We have to dramatically scale back military funding and the military mission and put America's military leaders in their place and make it clear that this is a country still run by elected civilian leaders, not unelected military leaders.

I think that this is a major wedge issue where many in Washington, in both parties, are strongly tied to supporting the military, but there is widespread popular opposition across the spectrum. The leadership of the right is firmly tied to supporting and even growing the military-industrial complex, and that why we need a movement defined by opposition to that agenda.

Not only that, but if there is to be a challenger to Obama from the left, this is going to have to be one of their major positions. I'd really like to see a third party candidate to the left of Obama in 2012. I think it actually makes sense, because the Republicans are going to be running Tea Party candidates, so a third party to the right of the Republican won't happen (unless they run on the Tea Party folks between now and then, but I doubt it).

"The only one we're voting for is the one who'll stop the wars!"

See the following related articles/posts:
Tomgram: Engelhardt, Why the Troops Are Coming Home
The Runaway General
Are we ever leaving Afghanistan?
The war in Afghanistan: Year 10
Robert Gates: 'We're Not Ever Leaving' Afghanistan
Hands off the warfare state!
Conservative think tanks oppose Republican efforts to trim defense budget


Posted by rationalrevolution.net at 7:31 AM EDT | Post Comment | View Comments (5) | Permalink
Monday, October 4, 2010
 Americans don't know how bad inequality is, but want less

Topic: Commentary

A recent study shows that Americans vastly underestimate just how bad economic inequality is in America, and that even with this underestimation, Americans overwhelmingly desire less economic inequality, across all party affiliations and even across income levels. In addition, the study notes that while there is widespread agreement that Americans want less inequality, there are major differences in what people believe are the root causes of inequality in America.

For more on this study see: Study: Most Americans want wealth distribution similar to Sweden

For the actual study see: Building a Better America - One Wealth Quintile at a Time

This basically confirms my fundamental beliefs about American conservatives on economic issues, and is the underpinning of much of my writing on economics here on this website.

My view has long been that America is a fundamentally populist country, and that American conservatism is fundamentally populist. I think that if you got rid of all the labels and just asked people directly about how an economy should work, we would find that the vast majority of Americans are actually Marxists, they just don't know it. In fact, some of the people who sound the most like Marxists are social conservatives. Anyone who believes that individuals should be compensated based on how much value they create is essentially a Marxist. I'd be willing to bet that 98% of Americans believe this. Any time I hear a social conservative talking about problems with the economy this is how they frame the discussion. Anyone who believes that income should be based on ownership of capital, where value created by non-capital owners is redistributed to capital owners who amass huge fortunes through this redistribution is a capitalist. I've never met any actual capitalists. I've met a bunch of people who say that capitalism is great, and the best, etc., and when you ask them why the usual answer is "because its a system where an individual's income is based on how hard they work". Bah! The whole basis of support is based on an intentionally promoted misunderstanding.

The explanation for this situation, a situation where Americans are grossly misinformed about economic disparity and where Americans have such a poor understanding of economic fundamentals and ideology, is that this misinformation is an intentional and systemic part of the American education system and American media.

American teaching of economics, even at the university level, is flat wrong. In grade school, American education on economics can be seen as meaningless at best, and outright propaganda at worst. And of course the "mainstream media" (a term now cliche in itself) just flatly and plainly avoids any meaningful economic reporting and analysis and is essentially a propaganda arm for corporate America. I can only assume that economic reporting within mainstream media is undermined a combination of having economic reports and analysis who truly don't know what they are talking about, and by both implicit and explicit censoring of economic information in the media.

For example, something that would be extremely easy to report, which doesn't even require any real understanding of economics, is simply reporting on what the top incomes are in America. I'd wage a bet that 85%+ of the population doesn't know that there is anyone in this country with incomes over a billion dollars a year, almost no one knows this. The Democrats don't even mention it, which shows where their true agenda lies. All of this talk about raising taxes on those with incomes of $200,000 and over just reinforces American misperceptions. We shouldn't even be debating whether or not people with incomes of $200,000 a year are "wealthy" or not, it's a total distraction. Screw the small fish, go straight for talking about the people with incomes of a billion dollars a year!

It's also noteworthy that all of the books written over the past 50 years that are "defenses of capitalism" are completely propaganda and hogwash, which don't even remotely address any of the real criticisms of capitalism. The works by Friedman and Greenspan, etc. are all complete nonsense, which just intentionality avoid even bringing up any of the topics which they know that they can't possibly win on. These books create a straw-man version of capitalist criticism, and then tear down something that was never real. And these are the types of works that dominate American understanding of economics. In Friedman's and Greenspan's works they don't even address the issue of the relationship between capital ownership, wage labor, and income. In fact they never even mount a real defense of "capitalism", what they do is they make a defense of "market economies" and "free-trade" vs the Soviet style command economies. Free-trade and markets have essentially nothing to do with capitalism, it's pure avoidance.

Yes, as a part of the proposition on how to address the problems of capitalism, the creation of command economies was one of the proposed "solutions", but that's not really the issue, that's taking the focus off of capitalism and putting the focus on the shortcomings of other systems. Capitalism is about who owns the right to newly created value, and by what means those rights are legally defined.

The real issue that Karl Marx was addressing wasn't commodity markets, it was labor markets, and specifically labor markets in an industrialized economy where a small number of individuals own most of the capital and most of the people are wage laborers. This issue isn't even a part of the discussion on economics in America.

The popular assumption, upon which everything else is based, is that income in America is inherently fair, and that by definition whatever an individual's income is, that is the true value of their contribution to society. When you start with that assumption, no meaningful discussion of economics can take place, because it is that foundational assumption which is wrong, and until that assumption is corrected nothing else of meaning can be understood.

In my next article I will do my best to as clearly as possible show the differences between a pre-industrial and an industrial economy, to show the evolution of the American economy over the past 300 years, and to explain as clearly as possible what capitalism really means, what the effects of industrialization are on capital ownership, and to plainly address the mechanisms by which industrialized capitalism disenfranchises the majority of the population and creates a system of not only unfair and unearned income distribution, but why an unregulated capitalist system inevitably leads to its own demise.

I remain convinced that if a  fundamental understanding of economics can be properly communicated to American social conservatives, that American conservatives will demand economic change and will stop supporting organizations like the Republican party, which acts against their economic best interests. I do believe that with a better understanding of economics, there would be broad based support for major economic reform in America across the political spectrum, leading to much more equal distributions of capital ownership.


Posted by rationalrevolution.net at 10:14 AM EDT | Post Comment | View Comments (3) | Permalink
Updated: Thursday, October 7, 2010 5:56 AM EDT
Tuesday, September 28, 2010
 A Progressive Foundation for America's Economic Future

Topic: Announcements

A Progressive Foundation for America's Economic Future

This piece sets out various policy proposals for reshaping the American economy in ways that are progressive supportive of economic growth. The purpose of this piece is to serve as a contrast to current economic policy and set forth new ideas for how to improve the economy, while simultaneously reducing economic disparity.


Posted by rationalrevolution.net at 8:10 AM EDT | Post Comment | View Comments (21) | Permalink
Wednesday, September 15, 2010
 What is Pro-Business?

Topic: Commentary
CNBC recently ran an article about the outlook of some of the nation's wealthiest individuals stating that the outlook of these individuals is pessimistic about the future of the American economy and the Obama administration.

I would really like to know what these billionaires would consider a positive business environment. What exactly could they possibly imagine as a positive pro-business administration at this time?

Let's suppose that in 2012 the most "pro-business" Republican is elected president with a full Republican Congress, what exactly would this look like? What would the pro-business agenda be? Complete de-regulation, default on the Social Security System, elimination of corporate taxes and lowering of individual taxes?

While those might sound like "pro-business" plans, it's also quite obvious that the results of such an agenda would be the impending collapse of the American economy. With a massive deficit the fact is that taxes will have to be raised, at least on those with high incomes, if not across the board, in order to deal with it. Cutting of any significant domestic programs will undermine citizen's economic security and diminish investment in the future.

Do these billionaires acknowledge any complicity in the current state of the American economy? Do they understand their role in creating the current economic environment at all? Do they understand and not care? Are they intentional parasites, knowingly sucking nations dry and discarding them to move on to the next host, or do they somehow think that this is all the fault of "the government" or "the poor"? I really don't know. I do know from reading interviews and books by some billionaires that at least some of them seem to have no fundamental understanding of macro-economics at all. Clearly some of them do, but some of them don't.

Here is the deal, the vast wealth of America's richest individual's has been largely a product of both government and private  borrowing over the past 30 years, and of the system of global trade whereby products are produced by vastly underpaid workers in developing countries and sold in developed nations where commodity prices are higher. But that can only work so long as there is massive borrowing.

Basically what happened was that during the 1940-1970s America built up massive savings, capital reserves, and "credit worthiness", and all of that reserve and credit was then used to buy massive amounts of commodities, which we weren't creating. We consumed much more than we produced, because there was no way to get Americans to build all of that stuff for as little as workers in China, etc. were willing to build it for. Americans aren't going to work 12 hour shifts at 90 cents an hour to churn out iPhones, but the Chinese will, but of course if you work 12 hour shifts at 90 cents an hour you can't afford to buy iPhones at the prices that make them highly profitable. In fact there is no way to make the system work without massive borrowing by one group to buy at much higher prices than the group producing them is paid.

The economy is a shell game, it always was a shell game, and these billionaires who are complaining about the economic conditions are the ones who created the shell game and benefited from it. Now they are upset because all the shells have been overturned and the is no more shuffling to be done.

They should be glad they were able to rip the world off while they did and so far have gotten away with it, but instead they seem to be lamenting the fact that the charade can't go on any longer. My only question is, aside from guys like George Soros, how many of these other super-rich really even understand the situation?

The reality is that there is going to be a long term period of very low profits, even under the most favorable conditions to billionaires, because the developed nations are over borrowed and will take generations to pay down those debts, and developing nations will have to go through a period of rising wages before they can become "consumers". What is likely to happen over the next 50 years, under the best case scenario, is an equalization of living standards and incomes between developing and developed nations, and as that happens, the mechanism used by the wealthy to reap undeserved profits will be eliminated. The primary profit machine of the past 30 years has been producing for cheap and selling high, and under every imaginable scenario this condition is on its way out. Either wages and living standards will rise in developing nations eliminating the ability to produce cheaper there, or prices and living standards will fall in developed nations (deflation) eliminating the ability to sell high there, or some combination of both.

There just is no scenario where these parasites will be able to continue their ways, but the fact is the problems are all structural and systematic, and they are the ones who created them.

Phase I was the building up of the massive wealth imbalance between developed and developing nations. Phase II was exploiting that imbalance while it lasted. Phase III will be trying to "hold on to what you've got". That's what's coming next and I doubt it will be pretty.


Posted by rationalrevolution.net at 6:45 AM EDT | Post Comment | View Comments (1) | Permalink
Monday, September 6, 2010
 Three Kinds of Libertarians...

Topic: Commentary
Seeing as how it's Labor Day in the most anti-labor "developed" nation in the world, this topic seemed kind of fitting.

Someone e-mailed me a week or so ago talking about his family members' political views and asked me if I thought it was worth trying to even have a discussion with them. Part of my reply contained my view on what I think are basically three different kinds of "free-market" advocates. I presented this same case in a thread on minimum wages on the ultra-libertarian Mises.org website (under the name Jeff), and it basically goes like this:

There are three kinds of "free-market" advocates:

  1. Those who acknowledge that in a “free market” system, ownership of capital will become highly concentrated in the hands of a few, who will then by virtue of their concentration of capital, actuality come to control the market and also of course the government and everything else, i.e. that "free-markets" are only fleeting under natural conditions and that it is in fact capitalism that leads to the destruction of free markets and small businesses, etc. These "free-marketers" know all of this and support this because they believe in a system where the few rule the many and they openly acknowledge this and their disdain for their fellow man. They believe that life in inherently unfair and that its fine if a few super rich people unfairly dominate the rest.
  2. Those who think that "free-market capitalism" without "government interference" will give rise to a society in which every individual is an empowered capital owner and exploitation and poverty will go away for all those who are simply not to lazy to work. These people are basically delusional fools who have no idea what they are talking about.
  3. Those who actually hold the beliefs of type #1, but who advocate for laissez-faire capitalism using the arguments of type #2. These people make arguments in favor of "free-market capitalism" using euphemisms like "freedom" and "choice" and "liberty" and argue that all of this will bring about improvements for the poor, etc., but all the while they don’t really believe any of this. In reality they actually know that what they are arguing for will lead to greater economic inequality where the few rule the many, but they just pretend otherwise.
I posted this in a thread on minimum wages on the mises.org site, but I think it's very much worth repeating, largely because over the past 50 years in America an entire culture of economics has grown up around these "type 3" libertarians. What is so repulsive about these folks is that they don't even have the courage of their own convictions.

Instead of simply stating that, in this case for example, they are opposed to minimum wages because minimum wages can eat into the profit margins of business owners and share holders, they instead claim that they are against minimum wages because minimum wages hurt the poor.

Instead of simply defending policies designed to help the well-off at the expense of  the poor on the grounds that they will help the well-off, they defend policies designed to help the well-off at the expense of the poor by claiming that the policies are designed to help the poor. This is essentially what "Trickle-Down" economics is all about.

A case in point is one of the linked papers in the minimum wage thread on mises.org. This was a so-called study done by the Employment Policies Institute. The EPI is a right-wing think tank, funded by the tobacco, restaurant, hotel, alcoholic beverages industries.

They published a paper in 2001 called Does the Minimum Wage Reduce Poverty?

They answer they provide, of course, is no.

One interesting passage within the paper struck me, because it is so fundamental to the issue of how wages are understood, and to the assumptions underlying the "study".

"Minimum wage laws, if meaningful, require employers to pay some workers more than they would have earned in an unhampered market economy. For example, whereas the federal minimum wage at this writing is $5.15 per hour, in the absence of this minimum some employers might pay their workers $4.50 per hour. Economic theory suggests that in competitive markets, workers will be paid their marginal revenue product—the amount of revenue that the worker contributes to the firm. That is a wage consistent with the profit-maximizing behavior of employers and the utility-maximizing behavior of employees.

Thus, if a firm in an unregulated market economy is paying its workers $4.50 an hour, it is probable that the marginal contribution of the worker to the firm is about $4.50 in revenue per hour. If, in fact, it were higher, say $5.00, it would be profitable for another firm to offer the worker in question a higher wage than the existing $4.50. If, however, the government requires the firm to pay a wage of $5.15 per hour, it might discharge the worker in question (or allow its labor force to decline by attrition until the point that the marginal product of workers equals or exceeds the minimum wage of $5.15). Thus, economic theory predicts that minimum wages cause some unemployment."

This is, in fact, all wrong.

As Adam Smith wrote in Wealth of Nation:
"Though the manufacturer [worker] has his wages advanced to him by his master, he, in reality, costs him no expense, the value of those wages being generally restored, together with a profit, in the improved value of the subject upon which his labour is bestowed."

The very idea that an employee being paid $4.50 an hour is contributing exactly $4.50 worth of value an hour to his employer is not just total nonsense, it's not even within the realm of possibility.

Even if we exclude the additional costs of employing a worker, implying that the worker has to create more value than just what he/she is paid in order to cover not only his compensation, but also those additional costs, no employer would employ anyone if that worker were not creating more value than what they cost, in total, to employ.

If a worker is paid $4.50 an hour, then we also have to consider the additional Social Security contributions of the employer, the employer's compensation insurance to cover the employee, the unemployment insurance paid on behalf of the employee, the cost of the capital used by the employee, the costs of training the employee, the cost to supervise the employee, the cost of administration to process the employee's records and pay, etc., etc.

So, a worker being paid $4.50 is actually cost the employer probably more like $8.00 an hour to employ. So, we know that the value of the employee's labor must actually be at least $8.00 for is to be worth it to the employer to hire and retain him or her.

But, if the value of the contribution of the employee is only $8.00, then it still wouldn't be worth employing them at all either, because at a cost of $8, there would be no benefit to the employer from employing the employee. So, in reality we know that the value created by the employee has to be more than $8.

There is, or should be, some profit margin generated by every employee. If an employee is not creating as much or more value than they are being paid, then there is no reason to retain them at all (Note that over paid emplyees are still retained all the time for various reasons). And it is this profit margin that is in question. What minimum wages do, potentially, is that they can reduce the profit margins on low wage labor.

What minimum wages were designed to address were the scenarios where people were being paid $2.00 an hour to work at companies that were generating massive profits with highly paid executives. Clearly, those profits and executive pay were being generated by paying employees significantly less than the value of their labor.

Ahh... but now the "market economist" replies that in a market for labor, if the value created by those workers was actually so much higher, then those workers would have been able to find another employer who would have paid them more and accepted a slightly smaller profit margin on their labor.

But, basic economic theory also tells us why this doesn't hold out in the real world. There are, in fact, many, many reasons, such as:
  • Employer collusion. In situations where industries are dominated by a few large players, for example a few major clothing or shoe manufacturers, it can be more beneficial for employers to not bid competitively on workers in order to keep wages down for all of them. This can occur either explicitly through intentional planning or indirectly via the shared understanding of the market by the employers, without employers needed to communicate their intentions to one another.
  • Industry standard profit margins. Employers may not be willing toaccept lower profit margins than their peers, even if the profit margins in the indutry are high or have room to be reduced.
  • Due to geography the employment market can be very limited, creating few or no alternatives for employment, in effect, there is no labor market at all under these conditions.
  • Discrimination. Employers may all simply not agree to pay certain types of people (historically women, blacks, and Latinos in America) as much money for doing the same amount of work based on irrational biases and perceptions.
  • More fundamentally, labor markets aren't dominated by the value produced by the workers, but rather by the lowest compensation other comparable workers are willing to take for doing the work. This is what leads to the "race to the bottom", with minimum wages meant to be a final stop gap in that race to the bottom. The value of what is produced by the worker isn't determined by the labor market, it is determined by the commodity market where the products of the worker's labor are sold. Almost always, the worker has no real understand of the relationships between their own labor contributions and the commodity market, and neither do the consumers. This relationship is typically held in a "black box" by the employers. So in this case, market is not reflective of real value due to asymmetric information, where employers hold all or most of the cards.
As long as the minimum wage is less than the profit margin on labor, then the effect of the minimum wage is simply to reduce the profit margin on the labor, not to make the labor completely unprofitable. In order for a minimum wage to lead to unemployment, an employer has to have a more profitable means of investment.

This is really only ever the case if #1 its possible to outsource the work to an even cheaper geographic region that doesn't have the same labor costs #2 it's possible to automate the work more cheaply than it is to pay the higher wages, or #3 if the profit margin is overtaken, and the good or service can no longer be sold profitably at costs that cover the cost of labor plus a profit margin, which typically means that the good or service isn't in high demand in the first place.

As much as people may think that the issue of minimum wages may be heavily effected by conditions #1 and #2, in fact they are not, because work that is off-shored or automated is not typically minimum wage work. This should be pretty obvious, since the return on investment from automating tasks for what is already the cheapest form of labor is not nearly as high as automating the tasks of more highly paid laborers.

In fact, the effect of automation and off-shoring is typically not the elimination of minimum wage positions, leading to fewer jobs for the poor, but rather it is the elimination of medium and high wage positions, leading to the creation of more low-wage positions in the geographic regions where jobs are automated or off-shored from.

This is quite clear with automation. What automation and industrialization did was it replaced the positions of highly paid artisans with low-wage assembly-line positions. The same goes with off-shoring. The positions in America eliminated by off-shoring were not minimum wage positions, they were medium wage in the manufacturing industry. These are positions that typically paid between $8 and $25 an hour.

So, the argument that minimum wages lead to increased unemployment for the poor is also not correct on those grounds either.

The reality is that minimum wages do lead to reduced poverty, as is very clear when looking at the data in America from 1940-1960, in which minimum wages increased rapidly, followed with sharp reductions in poverty.

Not only that, but the paper published EPI is especially ironic, since EPI is funded largely by hospitality industries, which can't reasonably be off-shored or automated away, which in reality is the reason that those industries are fighting the minimum wage. They are fighting the minimum wage, not because they are concerned for the poor, believing that minimum wages increase or do nothing to reduce poverty, as they claim, but rather because they are concerned for the profit margins of the business owners and minimum wages do have the potential to negatively impact, in a direct way, the the profit margins of employers. Although, in an indirect way, by ensuring that the lowest paid people have some bare minimum of compensation, minimum wages actually boost profit margins across the whole economic system by helping to reduce poverty.

So once again we return to the fact that there are three types of "free-market" advocates / libertarians, honest elitists, honest (though misguided) populists, and dishonest elitists posing as populists. The sad story of American politics and economic discourse is the story of a culture dominated by the later.


Posted by rationalrevolution.net at 7:47 PM EDT | Post Comment | View Comments (5) | Permalink
Thursday, September 2, 2010
 Now on Twitter

Topic: Announcements

Rationalrevolution.net is now on twitter. @rationalrevo

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Updated: Thursday, September 2, 2010 7:59 AM EDT
Friday, August 13, 2010
 It's Time to Strongly Oppose Obama

Topic: Commentary

I've gone from being an Obama supporter to now firmly believing that every progressive should be in firm opposition to Barack Obama, and that there needs to be political opposition to the Obama agenda and the Democratic Congress by progressives which is as strong as that of the so-called Tea Partiers.

The sad ting is, that we once again find ourselves in a situation where the only few high profile people providing any meaningful analysis of the problems faced by this country are actually conservatives, because there aren't any high profile elected Democrats or Democratic pundits with either enough spine or intellect to make the case against the Republican policies and "free market" ideologies that are destroying the nation's economy.

Instead its left up to people like David Stockman, former  Reagan budget director, to make the case. I won't go into too much detail about Stockman's article in the New York Times, nor do I agree with everything that he said, but the point is that Stockman makes the case that underlying fundamentals of the economy these past 30 years have been driven by Republican policy, and that these underlying fundamentals are not just damaging to the economy, but that they are disastrous and fundamentally destructive in profound ways.

As Stockman notes, "But when, in the following years, the Federal Reserve chairman, Paul Volcker, finally crushed inflation, enabling a solid economic rebound, the new tax-cutters not only claimed victory for their supply-side strategy but hooked Republicans for good on the delusion that the economy will outgrow the deficit if plied with enough tax cuts."

This is exactly right, and it is what I said in How Reagan Sowed the Seeds of America's Demise. The reality is that the economic recovery that occurred late in Reagan's first term was not a product of Reagan's economic policies, it was a product of the Federal Reserve's policies, and also, which Stockman leaves out, the resolution of the oil crisis which is actually what largely allowed the Fed to be able to take the actions it did to bring down inflation. But yet, while the taming of out of control inflation was the real cause of the economic recovery, it was "Raganomics" that got all the credit,  which has since hooked the American right on the idea that the policies of unsustainable tax cuts and giving the farm to the rich actually works.

It never worked. The short-term recovery was a result of getting inflation under control, which was a result of ending the oil crisis, and the longer term "growth" of the 1980s and 1990s was all a debt financed bubble.

But instead of strongly going after these core and fundamental problems and misconceptions, Democrats, led by the Obama White House, have been busy trying to cater to the right and to "honor the Reagan legacy".

Which leads us to Robert Gibbs' now widely parsed comments on the "professional left".

Said Gibbs:

"I hear these people saying he’s like George Bush. Those people ought to be drug tested, I mean, it’s crazy."

"They will be satisfied when we have Canadian healthcare and we’ve eliminated the Pentagon. That’s not reality."


As far as I'm concerned this is the last straw.

Firstly, I've never heard any progressive say that we should eliminate the Pentagon, that's just trying to cast Progressives in an undeserved radical light.

Secondly, as has been noted by many others that have commented on the Gibbs comments, Barack Obama himself, when he was running for president, said that he strongly supported a "public option" as part of his health care reform agenda, and he said it again early in the discussions about reform, but then he just easily backed away from it, even though polls showed that a majority of Americans supported the idea as well, and analysis from every meaningful economist including the CBO, concluded that a strong public option would do more to control costs than a plan without a public option. So, the "public option", which is even weak as health care reform ideas go, was not only popular among the American electorate, it was also objectively judged to be more fiscally sound!

But it was dropped without a fight. Why? Everyone on the "professional left" knows why. Firstly because the insurance industry lobbyists flat out told the president that they wouldn't even come to the table if there was a public option, and secondly because the noisy Tea Baggers were already calling him a "socialist".

What Gibbs is apparently saying is that getting good legislation passed is not reality, which is useless.

What made progressives even more angry is that Obama said right from the beginning that a Single Payer system was off the table and not even up for discussion, and that's what a lot of progressives were actually pushing for.

But by taking a Single Payer system off the table Obama made two major blunders. Firstly, it meant that they weren't interested in considering all options to look at what could be the actual best way to control costs and improve heath care, but even more important from at least a political game playing perspective, it meant that they were already starting from a center-right position.

If they had just at least entertained the notion of a Single Payer system and fought for it a little and made the case for it a little, even if only superficially, then they could have "conceded" on Single Payer and moved to a public option as a more "centrist" option.

But instead they tried to start out by outright rejecting the ideas of the so-called "left" and moving to the right preemptively. We all see where that got them, all it did was redefine what was considered "too far left". And that's the real problem with the Obama White House.

Obama is doing tremendous damage to progressive ideas, even more damage than Bush and Reagan did, because Obama is redefining what it means to be progressive. The health care plan passed by the Obama administration is now the definition of a "far left" health care agenda, when in fact its a damned right-wing agenda. Hell he basically did the Republican's work for them by passing what in reality they would have loved to have been able to pass themselves.

If the Republicans had tried to pass the exact same plan that the Democrats just passed every progressive in America would have railed against it as a right-wing give away to big business, but because the Democrats were selling it lots of Democratic voters got on board, pushing what amounts to a right-wing agenda.

The reality is that some of the health care reform ideas of the "professional left" are in fact more business friendly, would control costs more, and, I believe, would have broader public support. For example, some form of government run national health insurance system, even if it also allowed for private insurance companies, as many of the European do, paid for via a direct tax on income, a direct tax on employers, and on sales taxes of "unhealthy items", like junk food, cigarettes, etc., would actually be a boon to American businesses.

If you look at foreign competitors around the world, virtually all of our top competitors in developed nations have national health care systems with universal coverage. Places like Germany and Japan, which outperform the United Stated on exports, are able to do so in part because health care costs are actually cheaper for the companies there.

In both Germany and Japan, and many European countries, employers pay a tax per employee that goes toward health care, but guess what? That tax is relatively simple, straight forward, consistent, and cheap compared to the overhead of providing health insurance faced by American employers.

It's actually cheaper to just pay a tax than it is to shop for health plans, administer the plans, bargain for rates, and of course, still pay much more for the plans themselves than competitors pay in countries with government run/funded universal health care systems. Not only that, but the citizens then get the benefit of never having to worry about losing their insurance due to changing jobs or losing their job, and since the plans are national, not regional (though one could argue that in Europe the nations are like states) you don't have to get different insurance when you move either (within the same country).

These are the types of benefits that Americans and employers want and need, and yet the Obama administration and people like Robert Gibbs call this all some "far-left fairy tale".

And the even sadder thing is, is that the so-called "professional left" in America is still largely clueless. I still see prominent so-called "liberals", people like Rachel Maddow and writers on Huffinton post, etc. talking about how much money the super-rich "make" or "earn", even while they are decrying the incomes of the super-rich.

They miss the whole point.

A recent example, though perhaps not the best, I noticed was an article by Stephen Gandel of TIME (Time for Super Taxes for the Super Rich?).

Stephen states: "The rich make increasingly more of the nation's income. So shouldn't they pay a larger percentage of the income tax."

No, that's the point, the super rich are not making increasingly more of the nation's income, the super rich are taking more of the nation's income.

That's the fundamental issue that still isn't addressed, even by the vast majority of so-called "progressives", "liberals", and "professional-leftists". They keep saying that the rich need to pay more taxes since they are "making" more money, etc. No, they aren't, that's the point!

Stop saying that the super rich are "making" their money, they aren't, and by making such a claim it necessarily sets up the counter augment that taking "rightfully earned" money from anyone, no matter how rich, is bad. And that's a valid point. But the premise is wrong and the left in America still doesn't get it; certainly not any meaningful Democrats, though I think a few get it, like Kucinich , maybe.

What we need to be talking about is the fact that the vast majority of the income of the super rich is not a product of their work, it is not wealth that they produced, it is in fact income that has already been redistributed from the working class to the super rich. It is unearned income in the first place. Taxing it away from them isn't taking hard earned money from them to give it to an undeserving underclass, its taking unearned money that was never rightfully theirs in the first place back and giving it back to the people who really created it to begin with.

That's the point, that's where the discussion needs to be. As long as people keep incorrectly referring to the incomes of the super rich as "earned" the discussion will never move forward and progress won't be made.

As David Stockman said in his assessment of the economy:

"The third ominous change in the American economy has been the vast, unproductive expansion of our financial sector. ... But the trillion-dollar conglomerates that inhabit this new financial world are not free enterprises. They are rather wards of the state, extracting billions from the economy with a lot of pointless speculation in stocks, bonds, commodities and derivatives."

Actally they aren't extracting billions, they are extracting trillions.

Can we expect Barack Obama to even approach this issue? Certainly not, but David Stockman, former budget director of Ronald Reagan did...

See also: The Linguistics of Economic Deception


Posted by rationalrevolution.net at 10:37 PM EDT | Post Comment | View Comments (18) | Permalink
Updated: Saturday, August 14, 2010 4:52 PM EDT
Friday, July 9, 2010
 The evolutionary role of morality

Topic: Semi-random Thoughts

A few years ago I came up with a theory, or hypothisys really, on morality, that morality is actually a mechanism of evolutionary social selection. What morality really is, is an evolved social instinct that facilitates collective selection and shaping of the frequency of behavioral genes within a group.

I bring this up because of a recent piece on NPR titles Can Genes And Brain Abnormalities Create Killers?

Firstly, the answer is yes, genes are responsible for the behavior tendencies that make people more likely to be killers or anything else, and secondly, this is precisely why morality has evolved the way that it has.

My theory is that human behavior, like all animal behavior, is dominated by genetics. Our behavioral tendencies are genetically determined, and as such, our behavioral tendencies can be selected for and against.

Certainly the environment plays a role in how our tendencies develop, but there is always the underlying genetics. The degree to which someone is promiscuous, an individual's level of empathy with others, an individual's tendency toward selfish or self-less behavior, the tendency to be independent or subordinate to groups, etc., I believe are all traits that are heavily influenced by genetics.

When we look at "moral" codes throughout history and across cultures, what we find is that the way that morality has traditionally been enforced in societies is via mechanisms that heavily impact an individual's likelihood of reproducing. Violation of moral codes and laws have widely been punished by death, maiming, or expulsion from the group either via imprisonment or banishment.

All of these things, of course, eliminate or significantly reduce an individual's chance of passing on their genes. Morality really is quite primal. It is a collective emotional experience through which members of a group collectively exercise often harsh judgment and treatment upon individuals whose behaviors violate the desired behavioral template of the group. This is a means of group selection, not group selection in the traditional sense of the term in evolutionary biology, meaning selection of group traits via natural selection, but rather it is a means of a group selecting the traits that the group wants to perpetuate.

But this is also why morality is often irrational and indeed "immoral", because the moral sense is an instinctive one. Its also why there is such a strong natural tendency to form uniform collective moral unity within groups. The natural instinctive drive is for groups to form uniform moral codes that can be agreed upon and acted upon collectively.

This is where modern liberal society runs into so many problems. One of the foundations of liberalism, in the classical and post-modern sense, is the idea that morality is "individualistic", i.e. that morals are subjective and that it is acceptable for an individual's moral compass can be different from other people's or from the majority.

Now, the reason that this line to thinking came into prominence during The Enlightenment period of the 17th and 18th centuries and came to dominate the 19th and 20th centuries, is because of the obvious havoc that had been wreaked on Western Civilization by the attempts to enforce universal systems of morality since the rise of Christianity. It was clear to Enlightenment thinkers, America's Founding Father's chief among them, that trying to claim and establish one single absolute version of morality was the cause of many wars, constant social turmoil, and endless strings of persecution and injustices meted out in the name of so-called "morality".

So, America's Founding Fathers, and many other Enlightenment era liberals, viewed "morality" as individualistic, and that each person was entitled to their own moral judgments, so long as they obeyed the "law", which was then proclaimed to be established, not on a moral basis, but on a practical and ethical basis.

This gave rise to the idea in modern psychology that ethics are a collective pact based on reasoned guidelines for conduct, and morals are an individual's sense of right and wrong, and that morality cannot be objectively said to be right or wrong.

The problem with this view is that it is a view of what those thinkers would like morality to be, instead of what morality actually is. Indeed what the Enlightenment thinkers did was they defined morality in a way that made made practical sense for what they were trying to achieve, which was a greater level of tolerance and individual security. More tolerance was needed because the rigid intolerance that had ruled Christian civilization for the past thousand plus years was tearing civilization apart. The constant inquisitions and persecutions and wars against this that and the other sect, were undermining social security, the economy, progress in general, and indeed nearly everyone's individual well being. More tolerance was needed, claiming that moral judgment was personal and subjective instead of authoritative and absolute, was a means to that end, and its was a means that, while incorrect, was better off taken than not taken.

But the reality is that while morality is truly subjective, it is also very much collective, and indeed the evolutionary role of morality is to be harsh in its implementation. I would argue that in fact morality is "immoral", or rather unethical. Our moral judgments have been designed by evolution to be rooted in emotion and to be quite brutal in their exercise.

The piece on NPR asks the question, if our actions are determined by our genes is it moral to execute someone for committing a crime that they are genetically predisposed to do? The legal system of punishment is based on the idea that it is not acceptable to punish people, at least not severely, for things which they cannot control. This is why we have things like insanity pleas, etc. But the irony is that the genetic basis for behavior is likely the origin of our evolved social instinct to severely punish individuals who violate social norms in the first place.


Posted by rationalrevolution.net at 6:19 AM EDT | Post Comment | View Comments (3) | Permalink
Tuesday, May 25, 2010
 Rand Paul Really Doesn't Get It...

 

And neither do most of the people commenting on his comments.

As you may know by now in Rand Paul's interview with Rachel Maddow on MSNBC a few nights ago he said that he did not favor the governing being able to force private business owners not to discriminate based on race, posing the issue as one of federal government vs. a business owners right to "free speech".

But what Rachel Maddow and pretty much everyone else who has commented on Paul's statement has failed to realize is that Rand Paul's statement is completely off the mark in the first place. The Civil Rights legislation that prevented private business owners from refusing to serve blacks or providing separate entrances and quarters for blacks was actually something that many business people in the South wanted!

This is what Rand Paul and other such Libertarians completely fail to understand: in many cases businesses want government regulation of business.

Paul posed the issue as one of protecting the rights of private business owners to discriminate if they wanted to, and of the duty of customers being to avoid the business owners that discriminated in order to drive change, but that view completely misunderstands the reality of what was going on in the segregated South.

It wasn't the business owners who were discriminating because they were racists, the business owners were discriminating because their customers were racists! The reality is that most of the business owners in the South wanted to serve blacks, and why wouldn't they have, black money is as good as white, a dollar is a dollar after all. In the interview Paul said, "I think it‘s a bad business decision to ever exclude anybody from your restaurant."

But, the reason that they either didn't serve blacks or made them use separate entrances and quarters is because their white customers wouldn't tolerate it. If a white restaurant owner served a black family sitting in a main dining area the white customers would walk out, and so the business owners had to discriminate in order to avoid losing their white business, and thus being forced out of business, but the reality is that white business owners did want to serve blacks, but they couldn't.

And that is why the Civil Rights legislation that forced all businesses to serve blacks was actually welcomed by many white business owners in the South, who actually had wanted to serve blacks all along, but couldn't due to pressure from customers. Once the government took the situation out of the hand of the customers, however, the white businesses were free to run their business how they wanted to, and this is where Rand Paul goes so horribly, horribly wrong.

You see, Libertarians and Conservatives always try to paint the issue of regulation as one of government vs. private industry, but in reality that is actually seldom the case. Indeed most of the major business regulations in place in America today have been lobbied for by private industry. It is a false notion that an unregulated market provides "freedom" and that regulation necessarily restrict freedom, its simply not true any more than claiming that a roadway with no laws provides greater freedom of travel than a roadway with speed limits and stop lights and traffic lanes, etc. Those rules and regulations imposed on the roadway actually facilitate travel and lead to more freedom of travel, not less.

Forcing all businesses to serve blacks equally was actually good for business, and what many business owners wanted because it allowed them to run their business how they wanted to instead of how their customers dictated. It allowed them to actually serve more people and make more money. The same is true of many forms of business regulation, from the Pure Food and Drug Act of 1906, which was lobbied for by food maker H.J. Heinz in order to provide consumer faith in processed foods to almost all regulations today, industries prefer some degree of regulation because it helps the good actors in the industry to focus on doing business right without having to complete against what are detrimental practices in the first place and without having to worry about other businesses ruining the reputation of their industry. For example, all it takes is one beef exporter to export meat tainted with mad cow disease and a foreign country is likely to ban all meat imports from America, thus meat producers want government regulation in order to ensure that their competitors don't ruin their business for them.

Another good example is the recent problems we've had with the sub-prime mortgages in the housing market. This American Life ran a story in 2008 about the mortgage meltdown, in which one underwriter said that when the sub-prime trend began he was against it and tried not to write those types of loans. He could see clearly that this was a horrible business, but in the end he had to because the market dictated that he had to. If he didn't write that type of business he would have gone out of business right way because his customers were asking him to write those loans, and if he didn't they would have gone elsewhere. He fought it, he opposed it, he know it was bad, but in the end he had to do it because that was what the market dictated. It wasn't how he wanted to run his business and he knew that it was going to cause problems own the road, but he had no choice.

So he wrote sub-prime loans, and when the crash happened he went out of business. He was very angry and very upset about it because he knew all along that it was a bad idea and didn't want to do it but he was trapped by market forces. Either he was going to go out of business right away or he was going to go out of business later, and the thing is, is that he was a good business man who knew all along that this was bad idea and he didn't want to run his business that way.

The reality is that proper regulation of the mortgage industry could have saved his business because if his competitors had been prevented from making those unrealistic loans in the first place, then he wouldn't have had to make them either and he could have run his business way he wanted to, the right way.

Libertarians and Conservatives are completely misguided when they present all regulation as government vs. private interests, indeed most of the federal regulation on the books today actually protects the private interests of those being regulated and much of it was lobbied for by the very industries who are subject to the regulation. And furthermore, so-called Liberals and the mainstream media mostly just play into this false dichotomy and perpetuate this false reasoning from the other side of the coin, not stopping to point out that the premise is false in the first place, and that the reason that Rand Paul is wrong about his views on laws forcing private businesses to serve blacks is not because "racism is bad, no matter what", (which is true), but he's even more wrong because the laws were in fact in the best interests of private business owners and what many private business owners in the South wanted in the first place, in order to put a stop to the "dictatorship of the market", which was forcing them not to serve people that they ultimately wanted to serve. It's not because the business owners were racists that they weren't serving blacks, they weren't serving blacks because if they had done so they would have lost all their white customers, that is, until the government came in and put a stop to it and allowed the businesses to operate freely, the way that they wanted to.


Posted by rationalrevolution.net at 10:17 AM EDT | Post Comment | View Comments (4) | Permalink
Updated: Tuesday, June 8, 2010 7:07 AM EDT
Tuesday, April 27, 2010
 Socialist? More like moderate Republican...

Topic: Commentary

Listening to the media, especially the right-wing media, and the Tea Party crowd, one would think that president Obama is implementing massive liberal, progressive, and even "socialist" agenda, but this is far from the truth. Like the last Democratic president we had, Obama is pursuing a center-right agenda, implementing what were once considered Republican policies.

Polls show that there is little enthusiasms among Democratic and progressive voters, but the commentators on these polls can't seem to figure out why. They just claim that progressives are satisfied since they have someone they voted for in office and are thus complacent, or they claim that the "momentum" has simply shifted to "the other side".

The reality is that Obama and the Democrats are losing support because they have done nothing to earn the support of progressives. Obama is trying to "rule from the middle", and in the process he is actually shifting the country more dramatically to the right than George W. Bush did, because what Obama is doing is he is allowing center-right policies to be labeled far-left socialist policies, in the process redefining progressive polices as center-right policies, and leaving real progressive policies so far out in the cold that they aren't even discussed in the media anymore or even given mild consideration by Democratic politicians.

So let's take a look at Obama's "radical socialist" record. Since in office President Obama has:

  • Continued the wars in Iraq and Afghanistan

  • Backed president Bush's bailout of America's wealthy capitalists

  • Signed in an economic recovery act comprised primarily of tax breaks, with little or no direct job creation

  • Signed in a market driven health care reform package based on prior conservative plans

  • Is pushing for privatization of major components of the space program

  • Is opening up more land and coastal areas for oil and gas extraction

  • Has pushed for a freeze on all non-military discretionary spending

  • Is now pushing for what amounts to very modest financial reforms

Obama the radical socialist? More like Obama the moderate Republican.

The economic recovery package that conservatives like to rail against is a prime example of Obama's center-right policies. The reality is that the economic recovery package signed into law by Obama has not been very effective, and the reason that it hasn't been effective is because practically the entire bill was just tax breaks. Instead of engaging in direct spending and creating a works program in the spirit of FDR to put people to work, he signed in a bill whose single largest component was tax cuts, and whose second largest component was funding to the states to plug holes in state budgets, allowing states to avoid raising taxes. So the overall effect of Obama's economic recovery bill was tax cuts and the prevention of tax hikes at the state level.

The health care reform bill put together by the Democrats and signed by Obama was patterned on the health care reform package passed by Republican governor Mitt Romney, and advocated for by the Heritage Foundation, one of the most conservative and extreme anti-socialist organizations in America.

Indeed the Heritage Foundation supported all of the major elements of "Obamacare" for years, right up until both Obama and Hillary Clinton began using their ideas in the 2008 election, at which point the Heritage Foundation reversed its course, claiming that it no longer supported the approach.

So yeah, we got "health care reform", a right-wing version of it. The healthcare reform passed by the Democrats is nothing like what progressives advocated for, which was either a single-payer system or at least some form of government run non-profit national insurance plan.

So while wild-eyed irrational mouth foaming racists rage against Obama because his name is foreign, he's black, and he's a Democrat, the reality is that he is pushing forward what amounts to a very moderate center-right agenda that could have easily been advocated by Republicans just a few years ago.

The president is losing support because he is losing support among so-called liberals and progressives because the president and this Democratic congress have given American progressives nothing to be happy about.

I voted for someone that I thought might be a progressive, and instead all I got was George Bush Sr...


Posted by rationalrevolution.net at 10:32 PM EDT | Post Comment | View Comments (24) | Permalink
Updated: Sunday, May 2, 2010 7:28 AM EDT

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