Monday, October 14, 2013

Politics of the shutdown


Due to the government shutdown, there’s been a raft of soul-searching as to how American politics got to this point. In Collapse and the Sorites Paradox, I argued that collapse was impossible to speak about unless we defined a specific event that we could call a collapse. One of the possibilities I talked about was a debt default, which we are now only days away from (another one, secession, we talked about last month). So it looks like people like Dmitry Orlov might be due for a victory lap, although this crisis is entirely artificial and caused by political dysfunction rather than anything to do with oil prices.

Although these article have different perspectives, I’m going to try and summarize their conclusions below, along with some of my own, into a coherent narrative. Hopefully it’s close to the mark.

The short version is this: Wealthy elites, alarmed at the flattening of incomes that had happened between World War 2 and the 1970's decided to wage an all-out campaign to undo those policies (unions, a social safety net, good public services, progressive taxation,  environmental regulations, etc). To do so, they allied with all of the most venal, extremist, paranoid, reactionary and authoritarian elements in American society that had always been lurking under the surface but had been marginalized and kept under control by the "adults": John Birchers, Evangelical fundamentalists, Christian Reconstructionists, Southern racists, white supremacists, Dixiecrats, Posse Comitatus, "Big Mule" politicians, corrupt politicos, "sovereign citizens," "Patriot" militia brigades, libertarian Robber Barons (Koch Brothers, et. al.), Wall Street swindlers and takeover artists, Randroids, social Darwinists, and so forth, and used these elements to take over one of America's two major political parties in the name of eliminating their taxes, curtailing regulations, and busting unions. Now, having united all of the worst elements in American society under one banner for the first time (for they seem to have little else in common), organizing it, shaping it, and giving it a powerful vehicle (the reactionary authoritarian movement that calls itself the Republican Party), the business class can no longer control it, and like The Sorcerer's Apprentice, can only watch helplessly as the forces it has unleashed for it's own short-term benefit, fueled by white rage and decreasing living standards, tear the country apart (the "Corn-pone Nazis")

Here's the longer story: After World War 2, white Americans were lured by low taxes (because receipts were driven by future growth) into separatist suburban enclaves in the former cornfields surrounding now-decrepit cities made possible by the automobile. As they fled, they took economic activity and jobs with them, creating creating a vacuum in America's once-proud urban areas which promptly fell into disrepair thanks to the shrinking tax base and became minority ghettos. Coincident with this, there was a large population shift by individuals and businesses away from the “Rust Belt” states to the low wage and nonunion “Sun Belt” states of the South and Southwest, lured once again by lower taxes fueled by continuous growth, and made livable by the widespread use of air conditioning.

Subsequently, the American economy became “financialized;” America’s industrial might which won the war was packed up and shipped wholesale to China in less than a generation, leading to low-wage service jobs replacing factory jobs as the foundation of the economy.  Americans have consequently been experiencing stagnant wages for forty years, along with skyrocketing costs for healthcare, education, transportation, etc., while at the same time the tax burden was shifted off of unearned income and onto wages, and government services became "fee-based." The American public Balkanized along income lines, with wealthy Americans effectively seceding from the wider society, a society that was becoming less white and more urban over time.

A small cabal of wealthy oligarchs who had captured all of the income gains of the past forty years used part of this money to create a vast propaganda apparatus targeted to these white separatist enclaves in the suburbs, economically depressed rural areas, and the Sun Belt with things like FOX News, talk radio, think-tanks, online Web sites, etc. creating an echo chamber designed to radicalize white America. By denigrating and delegitimizing even the very idea of popular government, they hoped to create a faux-populist movement to untax themselves and undo the social reforms of the twentieth century and return to the policies of the Gilded Age. They allied with the Evangelical movement and began using divisive social issues to play “divide-and-conquer” against the lower classes.

The core of the movement is in the old Confederacy, where there is a long-standing legacy since the Civil War of undermining the authority of the Federal Government at every turn in order to keep power in the hands of local businessmen and politicians in order to maintain the system of class privilege and repression that is the legacy of Southern slavery. The South is also the nation’s stronghold of racism, ignorance, paranoia, religious fundamentalism, violence, gun ownership, social dysfunction (e.g. higher incidents of teen pregnancy, rape, incarceration, child abuse, infant morality, drug abuse, etc.), poverty and lower economic output. If Dixieland cannot control Washington, they will shut it down completely.

The untax the wealthy movement found a new life in the anger over the government bailouts, the election of an African-American president, and the economic downturn. Whites, destined to become a minority in America due to immigration and low birth rates, went into a profound psychosis, and wealthy oligarchs took advantage of this to bankroll a “Tea Party” movement, claiming that Obama was a Marxist, an atheist, a secret Muslim, was not born in the United States, will seize people's guns, etc., and laying the blame for nation’s problems directly at the feet of the victims of the economic recession (mainly poor and minority scapegoats) and “government taxes and regulations” (and not on Wall Street, corporations, or the banking industry).

To this end, they took effective control of one of the United States’ two major political parties and created a coherent worldview centered around what has been called “the paranoid style in American Politics.” for the New Right, the declining fortunes of white America were caused by an activist government determined to levy high taxes on “productive” (mainly white) citizens to give to a lazy and shiftless (mainly black) citizens in order to buy votes. They argued that America was divided into “makers” and “takers” (or ants and grasshoppers) where half of all Americans (the “47 percent”) pay no income taxes and thus are economically unproductive and entirely dependent upon government largesse (Mitt Romney: "They will never take responsibility for their lives"). They stoked rage against these “unproductive” citizens and argued that America’s massive debt burden was caused by a social safety net that had become a “hammock” lulling Americans into indolence (and not caused by tax cuts, the economic downturn, two simultaneous wars, or rising health care costs). Deindustrialization was not caused by the race to the bottom but by “greedy unions” and the housing meltdown was caused not by deregulation but by government forcing banks to make loans to poor minorities. Any form of government assistance was ”rewarding bad behavior,” and people had to be left to the mercy of the free market to "sink or swim" in a harsh, competitive world. The free market creates an ideal meritocracy; the poor, unemployed and indebted are exactly where they are entirely through their own actions, while the rich and powerful earned every penny through superior skills and talent. The poor must be made to suffer to give them the proper "motivation" to become productive citizens. As economic conditions deteriorate for most people, the resulting social dysfunction is put forward as the very cause of negative economic outcomes for the working class.

They made obscure books like “The Road to Serfdom" (which posits that government programs inevitably lead to oppression) and the works of Ayn Rand (where all economic benefits flow entirely from the efforts a small slice of wealthy elites and altruism is depicted as evil) into virtual bibles. At the same time, their media outlets portrayed all nonaligned media as “liberal” (and therefore not to be trusted), and claimed that both sides are "equally extreme,” despite a wholesale abandonment of pro-worker policies by the Democratic party (Bill Clinton: ”The era of big government is over, we must end welfare as we know it," etc.).

They also spent millions forming think-tanks and promoting the economic ideas  of the “Austrian School,” a formerly little-known economic doctrine that preached that any government interference in the market would harm the economy, that “letting the market sort it all out” was the only valid course of action, and that rather than mitigate the worse effects of the Great Depression, the New Deal actually prolonged the Great Depression. Government debt is always bad and the government must run its finances “like a household.” The Federal Reserve and “fiat currency” should be abolished and a gold standard should be reinstated to create “sound money.” All taxation is considered to be theft or “punishing success,” and goes into the hands of a government that is always and everywhere wasteful and inefficient (except for the police, security and defense industries). The private sector is superior to government in all cases, and failures of the private sector are always caused by some sort of government interference.

Because of certain political ideas inherent to the American system of government, a small, determined, well-funded minority can effectively throw sand in the gears of government when they do not get their way. This stems back from compromises made to slaveholding states, and the fear that “mob rule” would allow the majority to effectively seize power from the landholding aristocracy. Lower populated rural areas have disproportionate power over densely populated rural areas, especially in the Senate. In the House of Representatives, "gerrymandering," the practice of drawing districts to take advantage of America’s racial and income balkanization to create “safe” districts free from challenges to other parties, makes one party rule all but assured. Unlimited campaign spending has made politicians in uncompetitive districts fear primary challenges, since primary voters are the radical Jacobins of the party who will “punish” what they perceive as politicians willing to compromise. Unlike a parliamentary system, the levers of power are held by different parties both of whom claim legitimacy and can sabotage government functions through parliamentary maneuvers like filibustering and preventing votes from coming to the floor.

Now business leaders have effectively lost control over the party they took over, as the elements they unleashed with the objective of lowering their taxes and regulations has become a fanatical, radicalized, reactionary, nativist, conspiratorial, authoritarian political movement, opposed to even the very concept of government or the public trust in the name of “liberty. To them, government is always too large, taxes are always too high, and any sense of common purpose is derided as “socialism.” They see the nineteenth century as a golden age worthy of returning to, and see themselves engaged in a life and death struggle for the “soul” of the nation. They regard anyone else with a different opinion as “traitors" and opponents not to be negotiated with, but as threats to be eliminated. The right has even resorted to physical intimidation and has even formed a modern version of the Freicorps of inter-war Germany.

As whites become a minority, they increasingly look to disenfranchise large poor, minority, urban and youth voting blocks in order to retain power by any means necessary. In addition to gerrymandering, they have drummed up fear of nonexistent “voter fraud” to require ID’s at the polls, and they intentionally defund and understaff districts in poorer areas to prevent voter turnout, along with more direct vote suppression tactics such as armed "citizen monitoring" of polls. Increasingly, the focus is on electing allied candidates at the state level such as governors who have implemented identical policies around the nation (mostly written by ALEC) and followed identical lock-step agendas across a wide range of states such as cutting taxes, breaking unions, privatizing government, halting public transportation initiatives, passing “stand your ground” laws, overturning limits on campaign donations, selling off public lands and facilities, defunding social programs, and so forth.

As these policies make the white working class poorer and make the wealthy ever more powerful, the cycle is sure to keep repeating itself, making America ever more dysfunctional until it finally becomes ungovernable, ending up as a corrupt third-rate banana republic and failed state of only fantastically rich and desperate poor as the rest of the world looks on in a mixture of horror and pity at what was once the most admired nation on earth.

In addition, the following concepts are necessary to explain the world-view of the American Right-Wing:

1.) Producerism: “a doctrine that champions the so-called producers in society against both “unproductive” elites and subordinate groups defined as lazy or immoral.”

2.) The Just World Fallacy “Zick Rubin of Harvard University and Letitia Anne Peplau of UCLA have conducted surveys to examine the characteristics of people with strong beliefs in a just world. They found that people who have a strong tendency to believe in a just world also tend to be more religious, more authoritarian, more conservative, more likely to admire political leaders and existing social institutions, and more likely to have negative attitudes toward underprivileged groups. To a lesser but still significant degree, the believers in a just world tend to ‘feel less of a need to engage in activities to change society or to alleviate plight of social victims.’”

The Self-Attribution Fallacy/Horatio Alger/Fundamental Attribution Error: “Pull yourself up by your own bootstraps”

Calvinism/The Prosperity Gospel/New Thought Movement “God wants you to be rich.”

The Tytler Calumny: "A democracy is always temporary in nature; it simply cannot exist as a permanent form of government. A democracy will continue to exist up until the time that voters discover that they can vote themselves largesse from the public treasury. From that moment on, the majority always votes for the candidates who promise the most benefits from the public treasury, with the result that every democracy will finally collapse over loose fiscal policy, (which is) always followed by a dictatorship."

Social Darwinism: “A drunkard in the gutter is just where he ought to be”

Mellonism/Hooverism “Liquidate labor, liquidate stocks, liquidate the farmers, liquidate real estate. Purge the rot from the system”

The Objectivist Movement/Ayn Rand: “Money is not the tool of the moochers, who claim your product by tears or of the looters, who take it from you by force. Money is made possible only by the men who produce. Is this what you consider evil?”

Nostalgia: “Didn’t need the welfare state/Everybody pulled his weight/guys like us we had it great/Those were the days.”

Christian Reconstructionism/Dominionism

On to the articles:
For years, political scientists have been talking about how the demographic changes in the United States are inexorably leading to a Democratic majority, with Hispanics and Asian-Americans joining African-Americans and liberal urban whites to erode the political domains of white conservatives and white racists. 
But those predictions have always assumed a consistent commitment to the democratic principle of one person, one vote – and a readiness of Republicans to operate within the traditional standards of democratic governance. But what should now be crystal clear is that those assumptions are faulty. 
Instead of accepting the emergence of this more diverse and multi-cultural America, the Right – through the Tea Party-controlled Republicans – has decided to alter the constitutional framework of the United States to guarantee the perpetuation of white supremacy and the acceptance of right-wing policies. 
In effect, we are seeing the implementation of a principle enunciated by conservative thinker William F. Buckley in 1957: “The white community in the South is entitled to take such measures as are necessary to prevail, politically and culturally, in areas in which it does not predominate numerically.” Except now the Buckley rule is being applied nationally.
The White Man's Last Tantrum? (Consortium News)
To many Americans, the shutdown came out of nowhere. But interviews with a wide array of conservatives show that the confrontation that precipitated the crisis was the outgrowth of a long-running effort to undo the law, the Affordable Care Act, since its passage in 2010 — waged by a galaxy of conservative groups with more money, organized tactics and interconnections than is commonly known.

With polls showing Americans deeply divided over the law, conservatives believe that the public is behind them. Although the law’s opponents say that shutting down the government was not their objective, the activists anticipated that a shutdown could occur — and worked with members of the Tea Party caucus in Congress who were excited about drawing a red line against a law they despise.

A defunding “tool kit” created in early September included talking points for the question, “What happens when you shut down the government and you are blamed for it?” The suggested answer was the one House Republicans give today: “We are simply calling to fund the entire government except for the Affordable Care Act/Obamacare.”
A Federal Budget Crisis Months In The Making (New York Times)
Needham was cocky and brazen, and yet Republicans — even powerful ones such as Ryan — have to take him seriously, for the same reason they must allow themselves to be pushed around by freshman Cruz: GOP lawmakers live in fear of primary challenges from tea-party candidates, so they must obey those who influence tea-party activists. Like Cruz, Needham’s group has influence. It also has a lot of cash.

The Heritage Foundation tapped Needham, a Heritage staffer, to create Heritage Action three years ago, a few months after the Supreme Court’s Citizens United decision made such 501(c)(4) organizations a new way for the wealthy to influence politics. Needham’s operation fits well with recent moves by Heritage’s new president, former senator Jim DeMint (R-S.C.), to politicize the old think tank, and it rivals another 501(c)(4), the Club for Growth, in its capacity to terrify Republican officeholders.
The shutdown's enforcer-in-chief (Washington Post)
In the 2012 elections, a little more than 59.6 million Americans voted for representatives from the Democratic party while 58.2 million voters supported the Republican candidate. But due to the way that congressional districts are organized, Democrats got 33 fewer seats than the GOP in the House of Representatives. So right off the bat, the House GOP represents a minority of Congressional voters.

But it gets worse.
How Less Than 5% Of The US Population Caused The Government To Shut Down (Business Insider)
Fear of a changing society is one thing that unites all three factions. The battle over Obamacare, write the study’s authors, “goes to the heart of Republican base thinking about the essential political battle.”

    They think they face a victorious Democratic Party that is intent on expanding government to increase dependency and therefore electoral support. It starts with food stamps and unemployment benefits; expands further if you legalize the illegals; but insuring the uninsured dramatically grows those dependent on government. They believe this is an electoral strategy — not just a political ideology or economic philosophy. If Obamacare happens, the Republican Party may be lost, in their view.

    And while few explicitly talk about Obama in racial terms, the base supporters are very conscious of being white in a country with growing minorities. Their party is losing to a Democratic Party of big government whose goal is to expand programs that mainly benefit minorities. Race remains very much alive in the politics of the Republican Party.

    They worry that minorities, immigrants, and welfare recipients now believe it is their “right” to claim [public] benefits. Tea Party participants, in particular, were very focused on those who claim “rights” in the form of government services, without taking responsibility for themselves.

They are also unified in their belief that Obama is a usurper who has hoodwinked the public into re-electing him by hiding his true beliefs, which are essentially Marxist. They also think that Democrats have won the major political battles of our time because Republican legislators in Washington didn’t put up a fight.

But there are also deep divisions within the base, according to the analysis. Evangelicals still focus overwhelmingly on social issues. They think gay rights are the biggest threat to our society, but they also worry about the loss of what they see as an idyllic small-town culture. They feel besieged as the cultural ground shifts beneath them, and see themselves as a beleaguered, “politically incorrect” minority.

Tea partiers display a libertarian streak, and are far less concerned with social issues. They are staunchly pro-business. But there’s an easy alliance between these two groups – which make up well over half of the GOP base – because Evangelicals think the tea partiers are fighting back, and vice versa.

Both groups displayed a high level of paranoia, according to the researchers who conducted the study. They noted that this was the first time, in many years of conducting focus groups, that participants worried that their participation might trigger surveillance by the NSA or an audit by the IRS. In addition to thinking that Obama is a liar, and a covert Communist, these two groups were also more likely to express the belief that he is secretly a Muslim.
To understand the shutdown, you have to grasp the mindset of the Republican base (Raw Story)
The Tea Party right is not only disproportionately Southern but also disproportionately upscale. Its social base consists of what, in other countries, are called the “local notables”—provincial elites whose power and privileges are threatened from above by a stronger central government they do not control and from below by the local poor and the local working class.

Even though, like the Jacksonians and Confederates of the nineteenth century, they have allies in places like Wisconsin and Massachusetts, the dominant members of the Newest Right are white Southern local notables—the Big Mules, as the Southern populist Big Jim Folsom once described the lords of the local car dealership, country club and chamber of commerce.  These are not the super-rich of Silicon Valley or Wall Street (although they have Wall Street allies). The Koch dynasty rooted in Texas notwithstanding, those who make up the backbone of the Newest Right are more likely to be millionaires than billionaires, more likely to run low-wage construction or auto supply businesses than multinational corporations. They are second-tier people on a national level but first-tier people in their states and counties and cities.

For nearly a century, from the end of Reconstruction, when white Southern terrorism drove federal troops out of the conquered South, until the Civil Rights Revolution, the South’s local notables maintained their control over a region of the U.S. larger than Western Europe by means of segregation, disenfranchisement, and bloc voting and the filibuster at the federal level. Segregation created a powerless black workforce and helped the South’s notables pit poor whites against poor blacks. The local notables also used literacy tests and other tricks to disenfranchise lower-income whites as well as blacks in the South, creating a distinctly upscale electorate. Finally, by voting as a unit in Congress and presidential elections, the “Solid South” sought to thwart any federal reforms that could undermine the power of Southern notables at the state, county and city level. When the Solid South failed, Southern senators made a specialty of the filibuster, the last defense of the embattled former Confederacy.

When the post-Civil War system broke down during the Civil Rights Revolution of the 1950s and 1960s, the South’s local notable class and its Northern and Western allies unexpectedly won a temporary three-decade reprieve, thanks to the “Reagan Democrats.” From the 1970s to the 2000s, white working-class voters alienated from the Democratic Party by civil rights and cultural liberalism made possible Republican presidential dominance from Reagan to George W. Bush and Republican dominance of Congress from 1994 to 2008. Because their politicians dominated the federal government much of the time, the conservative notables were less threatened by federal power, and some of them, like the second Bush, could even imagine a “governing conservatism” which, I have argued, sought to “Southernize” the entire U.S.

Turning over federal programs to the states allows Southern states controlled by local conservative elites to make those programs less generous—thereby attracting investment to their states by national and global corporations seeking low wages.

Privatizing other federal programs allows affluent whites in the South and elsewhere to turn the welfare state into a private country club for those who can afford to pay the fees, with underfunded public clinics and emergency rooms for the lower orders. In the words of Mitt Romney: “We pick them up in an ambulance, and take them to the hospital, and give them care. And different states have different ways of providing for that care.”

When the election of Lincoln seemed to foreshadow a future national political majority based outside of the South, the local notables of the South tried to create a smaller system they could dominate by seceding from the U.S. That effort failed, after having killed more Americans than have been killed in all our foreign wars combined. However, during Reconstruction the Southern elite snatched victory from the jaws of defeat and succeeded in turning the South into a nation-within-a-nation within U.S. borders until the 1950s and 1960s.

Today the white notables of the South increasingly live in states like Texas, which already have nonwhite majorities. They fear that Obama’s election, like Lincoln’s, foreshadows the emergence of a new national majority coalition that excludes them and will act against their interest. Having been reduced to the status of members of a minority race, they fear they will next lose their status as members of the dominant local class.
Tea Party radicalism is misunderstood: Meet the “Newest Right” (Salon)
What is surprising and interesting is when this conflict is experienced not as a matter of interests but of identity. It’s one thing to see urbanites as fellow citizens whose policy preferences depart from one’s own; it’s quite another to argue that their policy preferences give rise to serious doubt about whether they’re really Americans. Yet exactly this is the message of all those conservative complaints about “socialistic” Democrats who ignore our constitutional traditions as they labor to install a “nanny state.” These aren’t true Americans, resolute, independent, self-reliant; they’re feckless, faux-European traitors. (Though one, in particular, may have closer connections with Africa than Europe. You know who I mean.)
To think in this way, one must identify the country with one’s own beliefs and values. Those with different preferences then become almost definitionally “un-American.” This identification has the consequence, however, that political conflicts are often experienced as personal crises; what’s at stake isn’t simply policy, but one’s own sense of self. This releases anxieties that cluster around an intensely imagined Other: liberal, conspiratorial, seditious.

A partial answer arises directly from the sociology of rural culture. Persons who live in cities learn quickly that the world is full of different kinds of people; diversity — of race, religion, outlook, speech, etc. — is a fact of life. Because of this, they tend not to connect these personal attributes with one’s ability to be a trustworthy member of the community. If they think about the conditions of citizenship, they are more likely to associate them with general qualities of character — honesty, integrity, loyalty — equally available to everyone, regardless of background.

Many rural areas, by contrast, lack this aboriginal experience of diversity; they may be characterized by high levels of uniformity in ideology, race and religion. Given this, it may be natural to assume that “everyone” believes what you believe, or worships as you worship, or looks and speaks as you look and speak. And because these attributes characterize the community as a whole, it may be equally natural to define the latter in terms of the former — to think of these qualities as necessary for responsible citizenship, for being “one of us.” Only a small step is needed to extend this logic from one’s own community to the country as a whole.

I said this answer is only partial. That’s because it explains why the identification of self with nation arises in the first place, but not why it persists. In the America of 2013, more thoroughly colonized by communications technology than any society in the history of the planet, no community is an island; each is part of the main — and The Matrix. Geographic isolation has been overwhelmed by smart phones, the internet, cable and satellite TV and Red Box. One’s own community might be an emblem of ideological orthodoxy, racial purity or religious conformity — but there is no escaping the knowledge that the country as a whole (much less the world) is not. So if we want to know why this identification endures in some environments but not others, we’ll have to add something to our account — a mechanism to explain the stubborn insistence that some people will always be outsiders. And because the South is ground zero for the paranoia that rules today’s Republicans, our explanation will have to apply with particular force and resonance to it.

I don’t think we have to look far. The explanation lies in the South’s experience with black slavery and white supremacy...This is a fraught subject, so I want to make my meaning clear. I am not arguing that all Southerners — or all conservatives — are racists or paranoids; I’m not even arguing that all Southerners are conservatives. (I myself would personally disprove that assertion.) Slavery, thankfully, disappeared long ago, and Jim Crow is now almost two generations behind us. Racism lingers on in the South as in America generally, but for the most part must now keep its head down and its voice low; it’s the vice that dare not speak its name. (This is not to deny, of course, that it retains considerable social valence.)  What I am arguing is that a certain habit of thought, powerfully shaped by the experience of slavery, survived the passage of that curse and continues to influence some Southern conservatives to this day. It no longer takes the form of a blatant assertion that only the white race is worthy of social trust; its definition of the normative community has shifted. (Though it remains associated with racialist, or at least race-conscious, themes.) It is now more likely to define that community in ideological terms — to see it as consisting of those who endorse a particular view of government and its rightful relations with traditional mores and economic power. It has, however, retained certain aspects of its earlier, darker origins. It is still obsessed with purity — ideological if not racial — and still invests those it regards as impure with a harsh, acute animus. And it continues to equate difference with illegitimacy. Those on the outside — the liberals, the Democrats, the “socialists” — cannot be trusted partners in political life; they want only to undermine our institutions and must therefore be expelled from them.

Thus we arrive at the paranoid version of politics described above, in which policy disputes signal an insidious betrayal of “our” way of life. This is surely what animates the conduct of today’s Republicans — the reflexive rejection of compromise, the flagrant violation of long-established institutional norms, the experience of diversity as an invasion by foreign, unfamiliar powers.

The Republican belief that it would be better to suspend the government (or default on the debt) than to fund “Obamacare,” for instance, can be explained only by this kind of wrathful, embattled logic. There is a sense in which the current shutdown is the culmination of the last 50 years of Republican history. Today’s GOP is the heir of Reagan’s remark that “[G]overnment is not the solution… government is the problem,” even as Reagan embodied the strident, anti-statist dogmas of Barry Goldwater. The Party’s development since 1964 has, in effect, been one long preparation for the time when it would have to argue that no government would be better than liberal government. It would make no sense to say this if liberals were simply misguided souls with some bad policy ideas. It makes perfect sense when one sees them through the prism of Tea Party doctrine: as illegitimate interlopers from the outer darkness whose intent is to exploit and subvert the normative American community.
Modern GOP is still the party of Dixie (Salon)
Four years ago, the modern Tea Party seemed to emerge from nowhere, leaving journalists bewildered and the public with few reference points to understand seemingly spontaneous rallies by middle-class people seeking lower tax rates. A search for the phrase “tea party” in connection with “politics” in major newspapers yielded fewer than 100 mentions in 2008—and when the words did appear linked together, they suggested studied formality and decorum. The next year, they appeared more than 1,500 times, often connected to “protest demonstration.”

But little was spontaneous about the new party. “Social movements that explicitly defend the interests of the rich and the almost-rich have been a recurring feature of American politics,” Isaac William Martin, a sociologist at the University of California, San Diego, reminds us in his new book, Rich People’s Movements: Grassroots Campaigns to Untax the One Percent. “Such movements shook the American polity before the Obama era, before the Reagan era, and before Barry Goldwater ran for president—before, even, the New Deal.”

With meticulous research, Martin shows how the modern Tea Party grew from decades of efforts by American oligarchs to de-tax themselves. They relied on cranks, rogues, and a few scholars to polish the most effective ideological marketing pitches. Their goal was selling the notion that if the rich bear less of the burden of government, all of us will somehow end up better off. These pitches have worked best when some newly proposed government initiative—like President Barack Obama’s Affordable Care Act—arrives to pose the threat of major policy change. They have depended on diverting attention from obvious questions, such as just how does a smaller tax bill for the Koch brothers benefit us?
We Shall Overwhelm (The American Prospect)
Summary: The Right wing of America is active on all fronts: shutting down abortion, disenfranchising voters, and holding America’s credit rating hostage. Now we add to that list something small, but disturbing and with the potential to grow explosively: the Oath Keepers, one of the many militia-like groups, are “going operational”. 
The Oath Keepers want to give America its own Freikorps! (Fabius Maximus)

Ted Cruz, Leninist (The Atlantic) Critics think the Tea Party senator is being self-defeating, but his antics make sense if he's actually trying to remake the Republican Party in his image.
Christopher Parker and Matt Barreto, who teach political science at the University of Washington, recently published “Change They Can’t Believe In: The Tea Party and Reactionary Politics in America.” They contend that there are two major strands of conservatism in America: what they call “non Tea Party,” “traditional” or “real” conservatism; and what they describe as “Tea Party,” “reactionary” or “pseudo-conservatism.” 
In response to my inquiry, Parker wrote in an e-mail: 
Ultimately, a conservative — in the classical sense — wishes to preserve a stable society. Of course, this includes stable institutions and observing the rule of law. For these reasons (and several more), a conservative prefers evolutionary, more incremental change to revolutionary change: revolutionary change threatens the stability conservatives seek to conserve. Hence, conservatives reluctantly accept change — so long as it isn’t revolutionary. They do so for the sake of stability and order. Moreover, for the sake of order and stability, real conservatives are amenable to political compromise with their opponents. 
Conversely, according to Parker, reactionary conservatives are 
backwards looking, generally fearful of losing their way of life in a wave of social change. To preserve their group’s social status, they’re willing to undermine long-established norms and institutions — including the law. They see political differences as a war of good versus evil in which their opponents are their enemies. For them, compromise is commensurate with defeat — not political expediency. They believe social change is subversive to the America with which they’ve become familiar, i.e., white, mainly male, Protestant, native born, straight. “Real Americans,” in other words. 
Parker and Barreto conducted surveys to see if Tea Party conservatives differ from non-Tea Party conservatives. As the graphs in Figures 1-3 show, the two kinds of conservatives diverge significantly on key issues: immigration, civil liberties and in how they see President Obama. 
A newly published book, “Our Political Nature: The Evolutionary Origins of What Divides Us,” takes a different tack in exploring the contradictory ideological positions of left and right.  The author, Avi Tuschman, who earned a doctorate in evolutionary anthropology at Stanford and now works at the Inter-American Development Bank, contends that “the best cross-cultural predictor of left-right voting and party affiliation” is revealed by a 22-item test developed by Robert Altemeyer, an emeritus professor of  psychology at the University of Manitoba. You can take the test yourself on Pages 11 and 12 of this document. 
Altemeyer’s questionnaire asks respondents to estimate their agreement or disagreement with statements like these: 
  • The established authorities generally turn out to be right about things, while the radicals and protestors are usually just “loud mouths” showing off their ignorance. 
  • Atheists and others who have rebelled against the established religions are no doubt every bit as good and virtuous as those who attend church regularly. 
  • The only way our country can get through the crisis ahead is to get back to our traditional values, put some tough leaders in power, and silence the troublemakers spreading bad ideas.
  • Everyone should have their own lifestyle, religious beliefs, and sexual preferences, even if it makes them different from everyone else. 
  • God’s laws about abortion, pornography and marriage must be strictly followed before it is too late, and those who break them must be strongly punished. 
Tuschman makes the case that Altemeyer’s questionnaire reveals three clusters of measurable personality traits that correlate with political conservatism or liberalism:  
1) Tribalism vs. xenophilia (an attraction to outsider groups); religiosity vs. secularism; and different levels of tolerance of “non-reproductive sexuality”;
2) opposing moral worldviews concerning inequality, one based on the principle of egalitarianism, the other based on ordered hierarchy, what people used to call “the great chain of being”; and
3) perceptions of human nature, people who see human nature as more cooperative vs. others who see it as more competitive. 
John Jost, a professor of psychology and politics at N.Y.U., uses descriptive language (language other social scientists characterize as  unflattering) to describe conservatives and flattering language to describe liberals. In “Political Ideology: Its Structure, Functions, and Elective Affinities,” a 2009 paper, Jost and two co-authors write: 
Speci´Čücally, death anxiety, system instability, fear of threat and loss, dogmatism, intolerance of ambiguity, and personal needs for order, structure, and closure were all positively associated with conservatism. Conversely, openness to new experiences, cognitive complexity, tolerance of uncertainty, and (to a small extent) self-esteem were all positively associated with liberalism.
James Sidanius, a professor of psychology at Harvard, working from a liberal perspective, uses a measure he calls “Social Dominance Orientation” to describe “the extent to which one desires that one’s in-group dominate and be superior to out-groups.
An individual’s social dominance orientation ranking, according to research Sidanius has conducted, derives from negative or positive responses to 16 statements. A person responding positively to the first eight (1-8) questions and negatively to the second group (9-16) would have a very high S.D.O. rating. 
First Group: 1. Some groups of people are simply inferior to other groups. 2. In getting what you want, it is sometimes necessary to use force against other groups. 3. It’s O.K. if some groups have more of a chance in life than others. 4. To get ahead in life, it is sometimes necessary to step on other groups. 5. If certain groups stayed in their place, we would have fewer problems. 6. It’s probably a good thing that certain groups are at the top and other groups are at the bottom. 7. Inferior groups should stay in their place. 8. Sometimes other groups must be kept in their place. 
Second Group: 9. It would be good if groups could be equal. 10. Group equality should be our ideal. 11. All groups should be given an equal chance in life. 12. We should do what we can to equalize conditions for different groups. 13. Increased social equality is beneficial to society. 14. We would have fewer problems if we treated people more equally. 15. We should strive to make incomes as equal as possible. 16. No group should dominate in society. 
In their book, Parker and Barreto found a strong linkage between higher S.D.O. ranking and Tea Party conservatives (“True Believers”). They write: 
S.D.O. is a reflection of one’s “preference for inequality among social groups.” Someone who has high levels of S.D.O. is likely to buy into the hierarchy-enhancing ideologies, ones that resulting in the perpetuation of inequality. People who are low on S.D.O. are more likely to promote equality. We contend that people high in S.D.O, people who are intent on keeping subordinate groups down as a means of maintaining group-based prestige, are likely to support right-wing movements and, therefore, the Tea Party. 
The following graph (Fig. 2), provided to The Times by Parker, shows that there are more Tea Party conservatives with high measured levels of social dominance orientation (39 percent) compared with non-Tea Party conservatives (30 percent).

Thursday, October 10, 2013

More monetary history - Roman edition


Since we talked about monetary history last time, I thought this would be a good time to include these fascinating posts from last year by Izabella Kaminsaka about finance in the Roman Empire. They debunk one of the most cherished libertarian beliefs- that the fall of Rome was caused by Diocletian's debasement of the currency. In reality, this was an symptom, not a cause, of an empire in the throes of decay. It could no longer expand, was wracked by migration, climate change, epidemic disease, extreme inequality, corruption, military overextension, and civil wars (sound familiar?). Simplistic explanations, especially ones that feed into a certain political agenda, are not to be taken seriously. Not that our current "default" is being driven by dysfunctional politics, not "money printing" per se.

I normally don't like to include entire posts, but this is too interesting, and I wanted to spare you the gateway on the FT site (all emphasis mine):
It’s Christmas. A time of year intrinsically linked to baby Jesus, a manger, some ancient wise men, choirs of angels and what is mostly an unflattering representation of the Roman Empire.

Roman PR has been faltering on other fronts as well, as this segment demonstrates…

The theory being pushed, of course, is that Rome’s debasement of the silver currency was somehow responsible for ultimate destruction of the Empire — making all this a highly relevant and cautionary lesson for today’s times. The moral of the story is perhaps best stated as: don’t do QE because the US Empire will be destroyed too. Or some such.

This also happens to be one of Ron Paul’s favourite fallbacks when it comes to justifying his rubbishing of the Fed and Ben Bernanke.

The theory featured prominently in a spat between Ron Paul and Paul Krugman in April this year, in which Ron Paul argued that QE would eventually lead the US to the same fate as the Roman Empire. Unfortunately, even Krugman failed to defend the Romans on the matter. In fact, he replied that he was not a defender of the economic policies of the Roman Emperor, Diocletian.

Which is a shame, because Diocletian really wasn’t as bad as many people make out, historically speaking.

Since it’s Christmas, a time of year when everyone deserves a proper hearing — and since I’ve always had a special place in my heart for the Romans, having been a student of Ancient History — I figured it might be useful to explain why a) Diocletian is misunderstood by modern economists and politicians, and b) why Rome did not fall because it debased its currency.*

First off, the Roman hyperinflation period — constantly referred to by debasement obsessives — post-dates actual debasement by about 60 years. Using it as a justification for the hyperinflation is like suggesting that a hypothetical debasement in the 1950s could in some way be responsible for today’s economic woes.

Secondly, the Roman debasement was not a one off affair. History tells us that the Romans were “debasing” their currency successfully for many decades with no hyperinflationary consequences. What changed ahead of the hyperinflation period of the third century, however, was that the Empire’s political stability was being threatened.

It’s as Dr. Benet Salway at UCL explained to us by email (our emphasis):

    In the case of the third century crisis it is arguable that the political instability preceded the monetary, in that debasement was used to make a finite amount of silver stretch further when pay rises and one-off payments were used to reward troops for support to a new claimant to the throne. There was a considerable timelag between debasement (starting with vengeance c. 200) and hyperinflation (which really did not kick in until the 260s). It is also notable that, despite re-establishing political stability Diocletian’s price control measures and currency revaluation both failed to curb inflation. It was only with Constantine’s shift away from debased and discredited silver coinage to the new gold solidus as the basis of the state’s monetary economy that inflation was brought under control. Ironically the success of the solidus as a stable coinage long outlasted the political existence of the empire in the west. The western empire’s collapse in the fifth century was not accompanied by financial meltdown. So, even in the Roman case the correlation between political and monetary stability is complex and varied.

As to what really caused the fall of Rome, we love the view presented by W.V. Harris at Columbia University.

In his paper “A revisionist view of Roman money” — in which he compellingly argues that Rome had a much more developed credit system than most people appreciate — he highlights amongst other things the following point:

    The purpose of this article has not been to demonstrate that per capita growth occurred in the late Republic or under the Principate (though such growth probably did occur in the second of these periods), but rather that shortage of money was not to any important extent a brake on growth. What impeded sustained economic growth in Roman antiquity was not a shortage of money, but mainly the failure to adopt technologies, especially a fuel technology, that would have allowed the Romans to escape from the Malthusian impasse. 
And as he explained further to us by telephone:

    The things that prevented the Romans from having a takeoff are basically two: One is lack of technological innovation. Lack of diffusion of productive technology and the other was not using fossil fuels. They didn’t, whereas England started having its industrial revolution (a much-debated question, as you know), in large part because of coal.

The other point worth stressing is that Rome’s credit system really was awash with private credit transactions (and debts). People like to focus on the coinage, but actually — if you follow Harris’ research — the primary mode of exchange for high value transactions, such as property, was credit. And that goes back to the days of the Republic. Coinage, meanwhile, was much more commonly associated with smaller daily purchases. When it comes to large gold payments, meanwhile, these were mostly dedicated to the settlement of international transactions. That is, for transacting with entities outside of the Roman credit system, and with people whose credit profiles were unfamiliar or not trusted by the Romans.