An Ode to the Twinkee

I come not to bury the Twinkee, but to praise it.

If you haven’t heard already, Hostess, the company that makes Twinkees, Ho-Hos, Wonder Bread, and other assorted products has gone out of business.

You can read about it here.

http://www.cnbc.com/id/49852161

This isn’t a simple tale of unions bad, management good. The teamsters agreed to dramatic wage cuts, but a small bakers union refused. They thought that the company’s threat to close down the plants was just that, a threat.

They were wrong. It wasn’t a bluff. Today, management laid off 18,000 workers. Now, it’s possible that the Twinkee brand could come back, under a different company. Knowing its popularity and ease to make, it’s unlikely that it will stay dead for long.

And yet…

I think this is an example of a trend long brewing in America. As consumers become increasingly health conscious, they are shifting away from consuming cheaper, iconic goods such as Twinkees and instead buying more organic hummus, all natural pinto beans, and whatever else is trendy. In my lifetime, I have seen food evolve into an identifier of class. Where you shop, what you eat, and what brands you consume are increasingly correlated with what class you identify with. The rich and the poor have always had different tastes. But call me naïve, I think that there used to be much more of a unified cuisine in America. The rich, the middle, and to an extent the poor would eat the same meat, potato, and vegetable dishes. The source of such goods wasn’t as important as it is today. Starting around the seventies, I’d say, this started to fragment.

If you are gloating, if you are one of those ever so healthy tofu eating bohemians now laughing at the demise of the calorie heavy, nutritionally lacking Twinkee, I offer a word of caution.

America was built on the backs of Twinkees. I don’t say this ironically or sarcastically. The country, wide and fierce, still in many parts wild, was gradually tamed and civilized through the efforts of dirty people, unsophisticated people, rough people. An ever increasing share of my generation would never work in a hot factory, a hell like steel mill, or in some other physically intense line of work. Machines have taken these jobs. Millions and millions of difficult labor intensive jobs have been automated or outsourced, leaving us with fields and fields of air conditioned office parks.

The people who worked these jobs needed energy, and quickly. They had neither the time, nor the money, nor the inclination to shop around for organic this, natural that. They needed calories, and they needed them fast.

Now we sit in our cubicles, having the luxury of both money and time. To those fortunate enough to have the resources available to eat healthier, to be a part of bourgeoisie, don’t look down upon the Twinkee eaters. The Twinkee eaters drive your trucks, they work your sewers, they pave your roads. The Twinkee eats clean your offices and homes, they stock your stores, they do all of those jobs that you would consider beneath you. To all of the yuppies out there, safe in your Whole Foods markets, only encountering a Twinkee when you step inside of a 7-11, to you I say join with me in mourning the death of the Twinkee. A part of America, ever so silly, ever so irrational, but ever so important to defining who we are, has died today. 

Where I Was Wrong, Where I Was Right, and Why Technology Changes Everything

            So close, and yet, so far. That’s the phrase that keeps entering my mind, one week from Election Day. After the reality of election night set in, I was initially despondent for a day. However, time heals all wounds and despite swearing off politics, I’m finding myself pulled back into it all.

            Coming into the election, I predicted that Romney would win. I am obviously wrong on that point, but I want to also address that point I made about liberalism reaching a dead end. After reading and responding to comments, I think I was only partially wrong on that front. My point still stands, but I do want to make some modifications to it. How often do you read or see someone admitting they were wrong! Intellectual humility is in short supply on both sides of the aisle, but alas, this is nothing new.

            Finally, I want to make a point on the debate over the shifting electorate and whether this election marks a new era of democratic ascendency. I think that the rise of technology has fundamentally changed the nature of the electoral game, with dangerous implications for Republicans.

Election

            Before Election Day, I explained how I was of two mindsets about the election. On one hand, Romney was leading in the national polls, despite a large oversampling of Democratic turnout. On the other hand, Obama had comfortable margins in all of the state polls. I made a final point that the cheapness of local media outlets’ polling could be skewing the results against Romney.

            I was wrong. But I was only wrong about one critical point. The 2008 Democratic turnout, far from being a onetime anomaly, did not go away. It was replicated in 2012. Romney won independents, but independents and Republicans weren’t enough to overcome the democratic turnout wave. I thought we’d have a D+3 or +4 electorate, which means that registered Democrats hold a three to four point advantage in terms of total makeup of the Election Day electorate. The initial results suggest that it was D+6 electorate, an outcome unexpected by many forecasters and pundits, including myself. Had I correctly gauged turnout, I would have been right. But then again, so would everyone else.

The End of Liberalism

            A week or so before Election Day, I made a post concerning what I saw was an intellectual dead end for liberalism. I thought that on social issues, the war was already over with the left having won. However, on the fiscal front, I argued that the welfare state was in danger, with no money to expand, or even fund, it and a middle class entirely resistant to tax hikes.

            The passage of gay marriage referenda in several states, the reelection of Obama, the legalization of pot, and even the passage a large tax hike in California for people making over $250,000 would argue that not only was I wrong, but I was severely wrong (to borrow a turn of phrase from the Mittster). I also had several commentators make some well reasoned points to which, after I called for criticism, it’s my duty to respond.

            On the social issue front, these resent results only prove the core of the argument that I previously made. The younger generation has moved decidedly to the left on various social issues. The left has won the culture war. I tried to make that point, and election night further proved what I had been saying. Where I was wrong, however, and where many people rightly raised issue, was on the implementation front. A culture shift does not immediately translate into a political shift. The translation of what people believe into what is law takes time and effort. Most importantly, this struggle provides political energy. A part of my original point was that because the left had won the culture war, the Democratic Party could no longer gin up social issues for momentum and would have to look to other areas for supposed oppression to fuel its base. This contention, I now feel, is wrong. The Democrats will have, for the immediate future at least, the social issues card in its hand, ready to be employed at any time. I made the mistake of assuming that a victorious battle meant a victorious war. Just because the battle may have been won, that does not mean that the war is over. The current generation of Democratic activists still has the real and imaginary struggles against oppression to chew on.

            Where I was totally right, and where nobody raised issue with, was on the fiscal front. Election night didn’t change this. There is no money left and if entitlement spending is going to remain where it is, taxes are going to come up on the middle class. Note, I ignored the upper class. You can raise taxes on the rich all you like, but it’s still not enough. Obama presented a false choice, entitlements or low taxes on the rich. The American people chose the former. But just because a choice has been made does not mean that reality, that math, has been altered. Confiscate all of the wealth on the rich, and you still run up short. The long term structural deficit of the US bodes ill for the welfare state. Of course, no one wants to debate this point. Finances, economics, and deficits are boring, dismal. Gay marriage, pot legalization, and birth control are all issues that are heavily driven by emotion, with facts taking a back seat to people’s impulses and moral sentiments. This isn’t so much of an indictment of these issues, but rather is a statement as to why they predominated the election debate when our country nears the financial apocalypse.

Technology

            So what happened on election night? Democrats came out of the wood work. Did the country suddenly make a huge lurch to the left over the last five to six years? I’d argue that while the country has moved leftwards, the election results of 2008 and 2012 can be more attributed to a different story, one that I haven’t seen commonly discussed. Technology has fundamentally changed the makeup of the American electorate.

            Where the Obama campaign succeeded, and how Obama managed to win, was by brilliantly pulling in unlikely voters to the voting booths. You can read more about this here. Simply put, the Obama campaign devised a way to bring people to the polls that normally don’t go and stay home. If they just did this in 2008, you could argue that it was a fluke. To do it again in 2012, after the economy is in a terrible position, shows that they have devised something to get Latinos, blacks, and especially young voters to the polls.

            I want to focus on latter group, young voters. The old conventional wisdom about young voters was that though they leaned sharply to the left, they never voted. Youth voters were full of sound and fury, signifying nothing. How did the Obama campaign manage to turn out the youth vote in huge numbers in 2008 AND 2012? Arguing that the youth became more liberal avoids the issue. The youth circa 1968 were close to being communists, but Nixon got elected. The question is not one of ideology but turnout. What changed? Technology.

To see what I mean by this, let’s take a gander at a little European country called Switzerland. The Swiss government was faced with a problem of constantly declining turnout in their elections. Making voting easier, by shifting to a mail in ballot system, did nothing to fix this. Turnout was much lower in the cities than in the small villages. Why? After some thought and research, an answer was found. The social prestige to voting drives people to vote. As Derek Thompson of the Atlantic puts it:

People like being seen voting,..., but we also like being seen having voted. Theoretically something signalling to our community that we've already voted should create the same feelings of social cohesion, civic duty, and belonging. And that's where the "I Voted" sticker comes in.

The "I Voted" sticker is a signal and an advertisement. It binds people together in solidarity and reminds others to join the group. Tens of millions of people will vote in every presidential election whether there are free stickers or free cookies. But beyond these intrinsically interested (and, possibly, more informed) voters are countless more citizens who need motivation to show up at the ballot box. 

The rise of the internet, and social media in general, has created an enormous social pressure on young people to vote. Think back to before the internet. Your contact with the outside world was limited through direct social interaction, the radio, and television. Now, you have smart phones, social networks, text messaging, internet forums, and the like to keep up the pressure to vote. If you were a 25 year old in 1980, you could feasibly get by without paying much attention to the election. Now, a quick glance at your facebook newsfeed shows the constant pressure people are under to make up their minds and vote. A generation that is always connected, always online, is a generation that will vote. The civic duty to vote has been replaced, or perhaps supplemented, by the social pressure to vote.

            My generation has been thrown into the political forum. No longer is the forum separate from the marketplace, separate from the church, separate from the bar, separate from the school. All of these formerly divided and separate public and private spaces have been amalgamated, like metal in a hot furnace, into an always loud, never ceasing, cacophonous political arena of total war and scorched earth. We can no longer ignore the forum, as technology has brought the forum into every part of our lives. There is no longer any respite from politics, except for ignorance. The youth vote, for better or for worse, is now an intractable, inseparable part of the electorate. Let us all hope that the constant noise of technology brings to us not only knowledge, but wisdom as well. 

Dane’s Handy Dandy Guide to Election 2012

 I would be seriously amiss if I didn’t post a pre-election post.

I don’t know if it’s the coffee or the election, but I am on edge. I have a nervous energy today that’s given me an extra spring to my step but also a growling stomach. It’s a tradeoff I’ll take.

For the benefit of all of my loyal three readers (hi, mom!) I thought I’d post a guide for the politically non-informed as to what’s going to happen tomorrow.

Who’s going to win? My gut tells me it’s Romney, but narrowly. That said, I’ve become completely bipolar on the issue. It’s as if my brain has split into two. On one half, I am completely convinced that it’s extremely unlikely for the Mittster to lose. On the other half, I don’t see a possible route for victory for team GOP. There are two realities at stake at this election but with only one of them being true. Let me explain the logic for each.

Mitt Wins:

The polling data that’s come out has told several stories. Though each poll is different, when aggregated together, we can build a semi-coherent narrative for this election. In the summer, Romney had a slight edge. Come a series of gaffes, including the now infamous 47% video, Romney started to seriously falter in September. With this, the punditocracy declared the Romney campaign dead. And then came the October 3^rd debate. Everything changed. Overnight, Mitt rallied into the lead for national polls. At one point in time, he opened up a seven point lead on Gallup. Then, with hurricane Sandy, the polls tightened again. With election day tomorrow, Mitt has a mere one point lead in both the Gallup and Rasmussen polls.

But within those headline, national polls, another story was emerging. The gender gap, with women voters long having favored Obama and crew, closed. In several polls, Mitt was running even with women, and ahead of Obama for men. Independents, the most crucial election bellwether group, were backing Mitt in 10, 15, and 20! point margins.

Plus, there are the fundamentals. The economy is in the toilet. The Middle East is not as keen on us as we earlier thought. The signature piece of Obama’s first term agenda, Obamacare, is disliked by pretty considerable margins.

Add to all of this Gallup and Rasmussen polls that show an electorate MORE Republican than in the 2010 election, and you have a near guaranteed Romney victory. Though Romney could conceivably lose the electoral college and win the popular vote, the chances of that happening are slim. You don’t win independents in such huge margins and have a fired up base and have the fundamentals on your side and lose.

Therefore, the logic of a Mitt Romney win assumes that the national polls are right. If Mitt Romney wins independents and has a large Republican turnout, he wins the elections, state polling be damned.

Obama Wins:

And here is the catch. The state polls. There’s been numerous state polls released, and they haven’t been good to Romney. Just one poll has shown Mitt up in Ohio, a crucial state. For the other battleground states, there has been a consistent small but noticeable Obama lead.

The logic behind an Obama win goes like this: it is highly unlikely, and damn near statistically impossible, for all of these state polls to be biased, and biased in favor of Obama. The national polling be damned. The election is determined by the electoral college, and Obama still has a large lead in that count. Even granting that the south goes back to Romney, Romney has to win a significant amount of the states he is now behind in.

Democratic enthusiasm may be down, the argument goes, but it’s not down that much. And, despite conflicting reports, Obama has a large early voting lead in some crucial states such as Ohio, Nevada, and Iowa.

Mitt could still win, but it’s increasingly unlikely. All of the prediction models based on polling data (e.g. Nate Silver, the Princeton model) give it to Obama. The London sports bet makers, give it to Obama.

So What’s Really Happening?

The fundamental problem with predicting this election is that both sides have logical, coherent, and empirically backed arguments as to why their guy is winning. Unlike in 2008, when the right placed all of their hope in a non-existent Bradley effect of saving their asses from the blue wave, there are legitimate reasons, and factual data to back these reasons up, as to why Mitt Romney may be winning.

The question then becomes, what do you believe, the state polls or the national polls? If you believe the former, Obama wins. If you believe the latter, Romney wins.

Here is a final clue that might offer some insight. It’s an argument that once I read, I became convinced that Romney will win (BUT I STILL HAVE MY DOUBTS! ARGH!)

Why are we getting divergent findings? It may have something to do with the likely voter model.

Polling, contrary to popular belief, can have weight and import. It’s not mere alchemy. But in order to do that, you need to survey lots of people. And, to do that, you need to pay lots of money. Polls are very expensive and the more people surveyed, the higher the cost for your polling organization.

Polling firms have another problem. Not everyone who responds to a poll is likely to vote. If we poll 1,000 people, and get their preferences, that still would tell us very little about the election outcome, because having a 100% turnout is near impossible in America. Usually, for Presidential races the turnout is around 55%-65%.

Thus, not only do polling firms have to poll a lot of people to get any sort of statistical significance, they also have to run a likely voter screen. This is a double edged sword for polling firms. On one hand, the tougher the likely voter screen, and the better your results are. On the other hand, the more people you cast out of the net, so to speak, the lower your actual polled pool becomes.

So, returning back to our original dilemma, I think what is happening is that colleges, newspapers, and the like are doing polling on the cheap. They aren’t paying the necessary monies to have a good sized likely voter pool. Look at the sample sizes, and you’ll see polls with only 800-900 people surveyed. They can’t afford to have a strong likely voter pool, because the poll will be whittled away to statistical significance. National polling organizations, the ones reporting a Romney lead, CAN afford to have a strong likely voter sieve, because they have the money to poll more people.

What's Next For Liberalism?

Before I begin, I want to make clear that I would be really keen to hear comments and critiques from left-leaning readers of my humble blog. Epistemic closure, or living in an intellectual bubble where you read, talk, and hear from people that only agree with you, is a real threat that I always want to avoid. This post is about the future of liberalism. Not identifying with the currently conceived liberal tradition, I humbly offer my comments, with the knowledge that I could be widely off the mark. If I am wrong, or ignorant of some insight, please correct me.

Pundits, particularly daft pundits, love to pronounce the death of things. Romney is dead in the water, the media cacophony screamed at us, until he came back after a decisive first debate victory and took the lead in most national polls. The GOP is dead, pronounced the pundits four years ago. The GOP later came roaring back, taking the House of Representatives in what was one of the largest off-term election victories in US history. The Democratic Party is dead, said many in 2004 after Bush held onto the presidency and led his party to shore up their margins in Congress. The Democrats came roaring back in 2006 and 2008. Go further back, and this trend repeats itself. Political parties, ideologies, and movements, are often eagerly declared dead, usually by their enemies. Some stay dead. Others are not really dead but merely resting. Still others are actually dead, but are then reborn like Lazarus.

Whatever the case, be on the lookout for a writer that declares some movement dead. This prognostication disguised as insight is usually base wish casting. The only ideology that I can think of as actually dead is old-school centrally planned state socialism, a la the Soviet Union. The reoccurring foolishness of man, however, may eventually prove me wrong on this point.

With this in mind, let me, without any hint of irony, break the rule I just established and declare liberalism, or at least the contemporary American conception of it, dead. If not dead, then dying. If not dying, then weakening and growing brittle, like a man past his prime.

This is patently absurd, you may say. The Democrats control the Senate and Obama is currently in the White House. Despite a deficit in the polls, it’s very likely he could win re-election. Recent victories by conservatives do not a trend make.

All of this is true, and I would be the first to caution against interpreting recent events as long term trends. Still, it seems to me that liberalism is directionless. The grand vision that it once had for America society has faded, partially because of its own victories. It continues along, powered no longer by idealism but by petty constituency politics. The liberalism of tomorrow, I believe, will not be defined by a coherent objective, but by the cobbling together of policies aimed at enriching highly specific and fragmented groups. It may win future electoral victories by cobbling together enough of these groups to form a voting majority, but no longer will it claim the mantle of being “the sole intellectual tradition” of the United States. Its hegemony over the politics and culture of the United States, erected by Roosevelt in the 1930s, is gradually becoming undone. This is not to say that conservatism will dominate. Instead, I think we will enter into an increasingly intellectually anarchic period of American politics, with all of the excitement and partisan rancour that implies.

Let’s break down what could be a meandering discourse into two sections, the economy and the culture. I borrow from Ted Kennedy’s speech to the 1980 Democratic Convention, when he spoke of the twin platforms of “economic democracy and social justice in this country.”

Economic democracy is a vague and nebulous term, but if I am being kind to liberalism, I understand it to mean the creation of an economy that is equally as democratic as our political system. There is a simple and attractive notion undermining liberalism’s approach to economics, and it is that the unfairness of life and its inherent arbitrariness should be minimized and fought as much as possible. How is it fair, they ask, that in a country as rich as ours that someone whose only crime is being born poor can go without food, shelter, and medical care? This question and the notion behind it animate much of the economic platform of liberalism. I think that upon first glance, these are very kind and decent thoughts, and I don’t begrudge anyone from holding them. If we look at the Democratic Party as the main, though imperfect, vessel of liberalism in the American system, we can chart a policy course of further attempts to minimize the randomness of one’s circumstances. The New Deal, the Great Society, and most recently, Obamacare, are all steps along the same path.

But here is where the path ends. All of these programs, noble minded though they may be, require money. Not only do they require money, they all subtly, if unknowingly, reduce the natural incentives towards thrift, industriousness, and personal responsibility. In short, they require the wealth of the capitalist system to work, but they undermine that very same system in two ways, one direct and one indirect. They take money out of the productive sector, gumming up the gears of the economy necessary to keep the money pump flowing. They simultaneously erode the overall work ethic and dynamism of the workers in the economy, eroding the innovativeness and competitiveness of the same economy.

We are at the point now where the machine is seizing up. The money has run dry. An era of unrestrained growth, doled out to needy groups, is ending. What does liberalism do when it can no longer expand the state? Of course, the state can continue to expand. A damn the torpedos, full steam ahead strategy could be employed. But this only worsens the inevitable pain and delays the day of fiscal reckoning. How does an ideology built on the government endlessly redressing the problems of poverty continue, when that government runs out of money? What happens when, as is currently occurring in California, governments have to place high and painful taxes on the middle and lower classes just to keep the benefits flowing?

In short, we need austerity liberalism. Can the intellectual proponents of an active and intervening government come up with a new way for the government to continue its activism, when it must pare itself back? As I have long argued, I think liberalism is going to have to come to grips with the fact that it needs to create a small list of spending it considers sacrosanct. Draw a red line around certain programs. Fight for the rest, but be willing to surrender ground.

Finally, we turn to social justice. In my view, social justice is a meaningless term. Putting that aside for the moment, let’s put all of liberalism’s non-economic social stances, such as abortion, under this umbrella. In this area too, liberalism is directionless. Unlike in economics, this directionless state has arisen due to liberalism’s victories, not its defeats. The culture is no longer traditional. The white dominated, protestant led patriarchy is largely dead. The highest positions in society have been opened up to all. Gay marriage has real momentum and will likely become national law after a few generations. Sex is commonplace and demystified. The individual has been liberated from all of the forces supposedly restraining it prior to the sixties. We are all now largely, for better or for worse, socially free. Whereas before we largely had political freedom, the death and destruction of most of society’s social mores and taboos has resulted in an additional social or cultural liberation.

And yet, there is emptiness. There is the obvious question of what next. Few taboos remain. Most groups are now equal. The oppression that now exists in American society is extremely limited, almost laughable when compared to a global view. What battles are there left to fight? Women have been liberated, blacks have been liberated, gays have been liberated. Of course, the struggle is incomplete, but the battles that occur now are rearguard actions, the cleanup of the enemy’s army. Many of these victories should be hailed and are just, but there is some regret, I suspect, amongst the broader populace that we went too far. In our wild, brash struggle for liberation, too much has been destroyed, too many valuable and sacred things tossed over. The sacred, once destroyed, once made commonplace, can never be restored. Useful social mores, however arcane they may be, can never be replaced once their justification is revealed as arbitrary. In this regard, I would frame the question that liberalism now faces this way. For an ideology built on liberation, what do you do after the last chain is broken? Where do you go after the last man is free? Where next, liberalism?

How mitt can win

I’ve had the misfortune of checking various internet sites dedicated to politics – Politico, Daily Caller, Huffpo, etc. – and one thing I keep finding are opinion articles, written by some no-name pundit/hack, offering advice to the faltering Mitt Romney campaign. In one breath, they declare Obama’s triumph to be inevitable, and then in the other, they freely proffer advice for Mitt Romney to seize upon and reinvigorate his dying campaign. Not to be outdone, I humbly offer a policy that I believe would lead Mitt to an easy victory, if only he were to take my sagacious advice.

A brief comment, first, on the state of the race. Obama leads, but by two to three points. I’m sure you can find some polls to back me up on that, and some polls that sharply disagree, but that’s where my gut tells me the race is right now. The Romney campaign is not doomed, quite the opposite really, and Obama is not leading ten points in Ohio and Virginia. I think the race is very close, with Obama possessing a slight edge. However, and this is another judgement call, I think Obama’s support is a mile wide and an inch deep. The volatile nature of this race, and indeed of the global economy and political situation, leads me convinced that a single event could sap some of Obama’s support. The undecideds are supporting him, by default, but are very willing to jump ship.

Now, onto my recommendations.

Romney’s greatest weakness is that he is a rich man, a stereotypical data-driven C.E.O. running for president a mere four years after a horde of white collar Mongolians wrecked havoc on the global economy. The middle voter, still experiencing pain from the recession and lukewarm on Obama’s accomplishments, instinctively hesitates when they see a man embodying all of the worst attributes of upper management. This, to an extent, is not Mitt Romney’s fault. He is a victim of circumstance. Yet he hasn’t done much, or rather, what he’s done has not been successful in dispelling this image.

So how does he overcome this? He can’t fight against this perception by remaking or recasting himself as a blue collar, hard working labourer. Instead, he can, and should, fight this perception on the policy front. That is, he should endorse some token policies that go against his corporate image. And I have an idea on such a policy: breaking up the banks.

Within certain markets, there is sometimes an inherent pressure on firms to consolidate and grow bigger. It makes little sense for there to be hundred of internet providers, for example. In banking, which used to be heavily fragmented on a regional basis, the market has now become highly consolidated. It’s easier than ever before to run a national banking system from a central office somewhere. Within the US, six banks account for two thirds of the entire nation’s assets. SIX BANKS! JUST SIX! Let that fact sit and jostle around in your brain for a bit. $2.4 trillion dollars are controlled by just four banks.

A highly integrated and consolidated banking system does yield some advantages, but it also carries with it some potential system-breaking risks.

First, the firms in any highly consolidated industry start to resemble and behave like monopolists. Through political manipulation and cartel like practices, they limit new entries into the market, lobby for regulation that gives them special advantages, and in extreme circumstances engage in price fixing. The LIBOR scandal in Britain is a perfect example of what happens within an industry that has become too cosy, and thus too corrupt.

Additionally, there is the risk of a systemic collapse when one bank fails. Bank failures happen all of the time. If the bank is isolated, then the government can quickly act to ensure deposits and bring stability to the banking system. If a major national bank with linkages across the entire industry fails, then even the government’s near limitless resources can be overwhelmed. Is this likely? Any understand of the basics of the 2008 financial crisis will prove that not only is this likely, it happened and will probably happen again.

It then makes sense to break these banks up. As someone very sympathetic to capitalism, I recognize that there are times whereby the government can and should intervene to ensure the proper functioning of the market or its continued existence. You would have to be a hardcore anarchist to argue against the government’s power to break up monopolies (as an aside, I think governments tend, on the whole, to produce monopolies, but that’s another post). You can still be a rather strident libertarian and agree that sometimes, the government should step in not to manage companies or even, really, regulate them but to break them up into manageable pieces. We should do that with the banks. If we don’t, look what happens. Government bails them out, and in some cases, directly manages them. Actual socialism. I’ll take a dash of interventionism now if it prevents the flu of socialism later.

Romney, then, should propose to break up the banks. He could portray himself as a populist, a saviour of capitalism, coming from the belly of the beast to slay the beast. A Nixon to China moment, if you will. I don’t think that many on the right would disapprove the idea. You may hear some grumbling, but framed in the right way and it’s a rather right wing policy. The vast majority of people, still hungry for some revenge against the banks, would relish this. Most voters couldn’t be damned to know the in and outs of banking policy. But they would immediately recognize and approve anything that was perceivably a blow against the banks. Ohio voters, a particularly populist bunch, would love it. Independents, still searching for some inkling of reform, would love it. Left wing voters, reluctantly voting for Obama because of the lack of alternatives, would love it. Sure, they wouldn’t vote for Romney, but they might just sit this one out, for the chance to see the big banks getting their comeuppance. Small businesses, a core part of the Republican coalition, would love it. I even think Wall Street would like it. It would be sure to alienate a few of them, but they are smart enough to know the beneficial economic effects it would bring.

The conservative logjam over taxes

By now, everyone has heard, discussed, and dissected Mitt Romney’s comments to a closed fundraiser on the “47%.” To recap, Mitt said something along the lines of, “my strategy for lower taxes isn’t going to resonate to everyone, especially since 47% of the American people don’t pay taxes.” He then went on to claim that those people are dependent on the government, feel entitled to healthcare, and other services, and are mostly going to vote for Obama.

Wait, instead of me paraphrasing it, let me just quote it here:

There are 47 percent of the people who will vote for the president no matter what. All right, there are 47 percent who are with him, who are dependent upon government, who believe that they are victims, who believe the government has a responsibility to care for them, who believe that they are entitled to health care, to food, to housing, to you-name-it -- that that's an entitlement. And the government should give it to them. And they will vote for this president no matter what. ... These are people who pay no income tax. ... [M]y job is not to worry about those people. I'll never convince them they should take personal responsibility and care for their lives

Let’s put aside the political horserace analysis of his this will all play. My own thoughts on that? Marginal to slightly negative against Romney, but nothing game changing. The race will be won or loss despite, not because of, each candidate’s gaffes.

No, his quote reveals something deeper. Conservatives are stuck without knowing which way to go on taxes. Moving Romney out of the picture, the comments about the 47% reveal a deeper problem, one in which conservative anti-tax ideology offers no clear solution. Or rather, there are two solutions, but they go down very different pathways. I’ll explain, but first, the facts.

Romney’s claim about 47% of people is slightly accurate. It’s true that only 46.6% of people pay income taxes. But these people pay other taxes. State taxes, local taxes, payroll taxes, sales taxes, etc. So it’s not accurate to say that 47% of people don’t pay any tax at all. Additionally, many of those 47% are retired people, unemployed people, and soldiers (I’m fairly certain military officials don’t pay income taxes, but I could be very wrong on this).

If we take a look at this chart:

You can see that most people, except for the very young and the elderly, pay income taxes. The numbers start to decline once retirement age is hit.

Let’s take a look at another chart, this time from the Economist. This is all going somewhere, I promise:

Whoa! Something is going on in that chart in the right! The percent of population not paying income taxes stays fairly constant, until 1986-87. Then, it jumps and then continues to rise, jumping once more in the Bush presidency. What’s going on? Well, for one, the elderly population is rising. Something else happened, however, that reveals the conservative logjam I spoke of in the title.

Conservative, although I should say Republican, ideology used to hold that taxes were the ultimate evil. Spending was bad, but the deficits of the Bush years and Reagan years proved that those administrations, and the broad populace, felt it was more important to keep the tax rates low then keep spending down as well. In other words, taxes were a first priority, spending was to be dealt with later. As such, both Ronald Reagan and Bush 2.0 dramatically expanded the people who could claim exemption on income taxes. Why? Taxes were/are bad, something that the working poor should not be faced with. There is some economic logic to this. If you place high income taxes on the working poor, then they are faced with the scenario where it is potentially more beneficial to claim benefits than to work a low paying job. So, they stay out of the workforce. Lower the marginal taxes on income for the poor, and they have more incentives to get and have paying work.

Now though, there’s a backlash brewing. Within conservative blogs and magazines (to be fair, this thought is not limited to the right. Some left-wing commentators agree with these notions as well.), are starting to revolt against the idea that ever more people should be spared from the tax rolls. Spending is out of control and we need to broaden (that is, include more people in) the tax base in order to bring more revenue in, it’s argued. Yet the main argument these people make is that it is not fair for an ever declining share of the population to support programs intended for the majority. An ever smaller group paying ever more taxes will lead to distrust and enmity on the part of taxpayers towards the poor and benefit claimers. It will also lead to the majority of the citizenry to place ever more burdens upon this group.

There is also a claim made specifically about the income tax. When you buy something or invest in something, you have a sense of ownership over it. As such, you are more likely to take care of it or watch out for it. For proof of this concept, observe how protective most people are over their children or how a renter treats a property vs. a homeowner.

So the conservative logjam is now clear. Do conservatives want to continually reduce the amount of people having to face taxes, saving them from having to face the onerous fee for having done one’s duty and worked a day’s worth of labor? Or, do conservatives want to start to reverse thirty years of Republican policies, and start to expand the taxrolls in order to promote a sense of civic ownership and, it is hoped, build up support for reducing the welfare state? The answer remains to be seen.e logjam I spoke of in the title.

The Nostalgic Generation

 What follows is not a post on politics, not is it something data driven. Instead, it’s merely my observations, with no empirics to back them up. Take them or leave them as you will.

If we can agree on the idea that generations have traits, then I think that my generation, the millennial generation, would have among its traits a defining sense of nostalgia. All generations eventually exhibit something resembling nostalgia, given enough time. It is only natural to look back on one’s past, and in doing so grow nostalgic for the youth and culture of one’s yesteryears. But what is surprising to me, and should be surprising to any outside observer is the fact that our generation is already so nostalgic at such a young age. We millennials seem to be caught up in some form of a delayed adolescence, perhaps subconsciously resisting the drag and pull into adulthood.

I can only speak anecdotally, but in conversation with my peers, the past, specifically our relatively short past, is frequently the topic of discussions. We eagerly look back to the music, the games, the quickly forgotten school yard fads; all of the cultural ephemera that are usually gladly disposed of, fondly returned to only when the grey years approach. Go to a popular website or forum used by my age group, say reddit.com, and watch and wait. Inevitably, within a few hours, there will be something posted and discussed that is from the late 80s to 90s. If you want to test this theory out, engage someone aged 19-28 and ask them whether pop music was better in the 90s than today. I suspect that their answer would be that it was better, and not only would you get that from them, I suspect that you also would get a long winded speech, or maybe a quiet, subtle expression, about how good it was back then.

Let me again say how unnatural, and indeed unprecedented, this all is. People in the prime age of their lives should not be nostalgically, and foolishly, looking back to what was only a few short years ago. They should be moving and looking forward, possessing the optimism and ambition that comes with youth paired with a bit of experience.

Why then, are we so nostalgic? I think the answer begins with an era and an event; the nineteen nineties and September 11^th.

In retrospect, the nineteen nineties were a time of peace and prosperity. The collapse of the Berlin Wall in 1989 (the year in which I was born) and the collapse of the Soviet Union in 1991 heralded a new epoch in history. No longer did the United States, and its system of capitalistic democracy, have any real ideological enemies or competitors. We had won. To be certain, there were numerous wars and conflicts around the world, such as Somalia and Serbia, but none of these conflicts were threatening to the United States. We had no existential threat. The specter of nuclear war, which loomed quietly but darkly over the national psyche during the Cold War, was gone. America was at her apex on the geopolitical scale. China had not yet risen, Russia had fallen, and scanning from our perch, we could see no one that could even begin to challenge us. Our situation was unparalleled in human history. We were described as a “hyperpower,” reflecting the fact that even the grandiose term superpower could not adequately describe our situation. The geopolitical security of this era was matched by the economic prosperity, at least for the United States, in the 1990s. The Reagan boom came back for another round. The peace dividend was combined with the revolution in information technology and personal computers, leading to an explosion in productivity and a corresponding rise in the stock market. Commodity prices were also low; no other nation consumed at our levels yet. So the rise in nominal wages was met with a rise in real incomes. We didn’t just feel richer, we actually were.

It is both naïve and daft to think that these dry, political and economic conditions would not leech somehow into the culture. And as the culture goes, so too goes the raising, forming, and molding of an entire generation. We were born into a special time. We were old enough to remember a time before the internet, but young enough to have no conscious memories of potential nuclear fire and apocalypse. Our infancy and childhood developed during a period of comfort and optimism. Technology still held possibility and promise. We were not yet aware of the neurosis and vulgarity that constant connections would bring. The pace of life was just starting to speed up, but we were still too young to experience it. Our collective childhood, carefree and worriless mirrored the zeitgeist of the nation. There seemed to be a great cultural exhale of breath, a relaxation of our collective muscles, the release of endorphins that all comes after a dreaded event passes without occurring.

Then something happened. Religious zealots hijacked four airliners and crashed them into our most potent symbols of economic and military power. In a matter of moments, an entire era came to an end. In the ashes of the aftermath, one could see that the past era, with its daft naivety, burned along mangled bodies and steel. America had threats again. We had enemies that turned every building into a possible sepulture.

This affected my generation, perhaps more deeply and subconsciously than we will ever know. I think a large degree of the anti-religion attitude, even among believers, characteristic of the millennial generation can be traced to this day. The peace and prosperity that we grew up with, the contentedness of the womb of American security, was violently and irreversibly ripped from us. Never, no matter how much we tried, could be go back to how things before. Unlike the baby boomers, who with the burning of their bras and the building of protest placards, knowingly and consciously destroyed the peace and stability of their childhood era, we had no choice. We were thrust into history, after having enjoyed an unprecedented but brief holiday from history. And, to top it all off, we had to go through the overwrought period of puberty and adolescence during the same period.

Is it any surprise then, that we are nostalgic? Is it any wonder that we look back to the past, a past for us marked by both childhood and prosperity? We were born into an era of excessive optimism. We were told that the future would be better, that tomorrow held promise. This proved to be not true. The future for us was marked by wars and ongoing and ever-deepening economic malaise. If this deep belief proved to be untrue, what other deeply held values and ideologies were also untrue? At once, we were sent adrift, into a darkening world with what little guidance we had slowly dying out. Thus we look back unto a brighter time, a more idealistic time, with a mix of nostalgia and melancholia. 

America is not a conservative nation

This is going to be a rather polemical piece, dry on current politics and more to do with philosophy and culture. My mind, as of late, has been shifting to culture. Yes, yes I still follow the daily political news, but I feel as if that is a reflective, rearguard battle. Increasingly, I believe that the real debate within our society is over what type of society we wish to be. The political system, being fundamentally democratic, will reflect such a society. In fact, much of the increasing partisanship, rancor, and ideological clashes in politics can be attributed not to a new set of political issues, but rather to the increasing divides in America’s culture. There is no longer a hegemonic culture whose mores, beliefs, and values set the course for the nation’s cultural and, consequently, political direction. But that is for another post.

The title of this post can mean many things. Typically though, statements as to whether America was a conservative or liberal nation are attempts to identify and describe that nation’s political preferences. These arguments take the form of identifying polling data that gives a majority response to a conservative or liberal position. A majority of Americans are pro-life, and thus we are a conservative nation, conservatives will argue. Wait, say the liberals, a majority back higher taxes on the rich and support the EPA, so we are actually a liberal. Some decide to split the baby in half, and label us a centrist nation. This labeling activity is fun, but ultimately pointless since the definitions of conservatism and liberalism, popularly understood, seem to shift so readily. But this is not what I have in mind. (For the record, I think America is a center right nation, especially on economics).

Before I make my point, I want to define a few terms. We frequently hear and use the terms conservatism and liberalism in our political discourse, but I believe they are divorced from their true meanings. Liberalism in the American sense is very different from liberalism as understood by Europeans. The same is true for conservatism. An American conservative and a European conservative are two very different political animals.

I’m going force a very crude categorization onto political ideologies. Despite all of their nuances and details and thinkers, I’m placing them into three very broad and overly general camps. I freely admit to all of the errors and abstractions this implies. The three main ideologies are: conservatism, liberalism, and socialism. Let’s define each one, starting with the latter.

Socialism is any ideology stemming from Marx that seeks to maximize or is primarily concerned with equality and opposed to traditional moorings. Socialism places emphasize on realizing equality through political or cultural means. It is also an economic system that excludes private property and places all ownership within the hands of the public. We delude ourselves if we think of socialism only in economic terms. As Antonio Gramsci and the Frankfurt School are so keen to realize, socialism incorporates and necessitates an all encompassing socialistic culture. This definition, if limited, should be relatively uncontroversial with my readers.

Liberalism is the next ideology in our list and one of the most variant ideologies. I define liberalism as any system that mentions or values rights and is primarily concerned with human liberty. Equality too has a role within the liberal system, and produces a tension with liberty that gives much of the character of the political energy within liberal systems. The liberal system is a democratic system, and as such requires, much like socialism, a matching culture. Liberal democracy produces and is sustained by a liberal political culture. Note, that liberalism has different flavors. It can be a more capitalist liberal system, such as the United States and the Anglosphere, or it can be a more state managed liberal system, such as the Nordic countries. Its variants all share the notion of private property stemming from a belief in political and natural rights. This challenges American contemporary wisdom, but capitalism and liberalism are twin forces, both upsetting the previous feudal order, both placing emphasis on meritocracy over inherited powers. My definition of liberalism is in accordance with the European and academic definitions of liberalism.

Finally, we have conservatism. In the European context, true conservatism is something very alien to most Americans. It places tradition and the natural order above all else. Conservatism is closely aligned with monarchism, though it can exist in other political regimes. Religion is highly valued, as are the traditional bonds within the community. The aristocracy rules not only because it is inherent to the definition of aristocracy, but also because the aristocracy trained from birth, is the best at ruling. The body politic is not constituted by a contract among peers, but instead by blood and tradition. Every man, from the peasant to the king, has a role within society. And everyman’s role is determined by their birth.

When viewed in this light, I come to what I mean by the title of this piece. America is not a conservative nation, because it was founded on a radical, liberal order. The constitution and Declaration of Independence, with their insistence on natural rights and the right of the people to both rule and determine those rulers, is fundamentally a liberal regime. It rejects the rights of the aristocracy, monarchs, and inevitably the church to govern. A man’s place in the world is determined by and through his own effort, not his father’s position or class. Indeed, the success of the liberal regime in America has thoroughly spread throughout the world. The old conservative natural order of duties and privileges, lords and nobles, monarchs and subjects, has been thoroughly demolished and replaced by liberal regimes. Tsarist Russia, Metternich’s Austria, and the Bourbon’s France are all dead, replaced by liberal democratic states. Even in countries that still nominally have a monarchy, such as the United Kingdom or the Netherlands, the actual governing regime is liberal, not conservative, in character with its emphasis on liberty and rights.

Under this context, America’s political parties are not fundamentally different, though they offer very different policy prescriptions and constitute very different classes and ethnicities. They are both liberal parties, arguing over what strain of liberalism should be adopted. Conservatives in the United States are the old radicals who have been redefined by the forces of time. They seek to maintain and return to the original liberal political order defined by negative rights, limited government, and liberty. The reasons conservatives place such emphasis on the constitution is because it is precisely that document, and its implied political understanding, that they seek to protect. They are liberals in the sense that they believe in rights, liberties, and equality, but they are conservative, and at times reactionaries, in that they seek to preserve and enact an earlier understanding of those concepts.

American liberalism, contemporarily understood, is just liberalism but with an increased focus on material conditions. The equal and free society endorsed by the constitution requires ever more interference in the private economy and culture to equalize man’s material and social conditions. The extent of which is subject to internal debate.

American conservatism seems to always be giving ground, especially in the cultural sense, because it is protecting something that the system it espouses rejects. The traditional family, and the implied interdependence of its parts, is not a product of the liberal order but the conservative, monarchical order. Individualism is a product of a liberal political order, and extreme individualism runs directly counter to the putative concept of the family. American conservatives want a liberal political system but with a conservative culture. But the liberal political system runs counter to a conservative culture. It actively encourages a culture reflecting the values and beliefs of itself. Whether or not a liberalism political system can survive with a liberal culture, a society of atoms and not families, over the long run is debatable and possibly, perhaps probably, unlikely.

Does this then predict the permanent ascendency of political and cultural liberalism? Not quite. It is certainly not a prediction of the permanent dominance of the American Democratic Party. If the culture changes, the parties will reevaluate their positions, in their constant efforts to seek a majority of voters. If a politically liberal system produces a liberal, individualistic culture but requires the conservative culture of yesteryear to sustain it, what then? I truly don’t know.

I’m going to end here. Perhaps more on this later. I hope this is clear, and as always, I welcome comments or questions. Part of the fun of this blog is not just in sharing my thoughts with the public, but putting pen to paper and crystallizing, through writing, many disparate and inchoate thoughts.

Who dares, wins

            I have two pieces on my mind, this one and another one on a new type of morality I’m seeing emerge within my generation, but I’ll save the latter for later. Instead, I’d like to focus on the Paul Ryan pick and specifically the left’s reaction to it. I think there’s an interesting story there that’s not being told and which, in the due course of this post, I plan to tell.

            Before we to that, just a few words on the politics of the Paul Ryan pick. As Will Ackell can attest, I was initially dismayed by the Paul Ryan pick for several reasons. I thought that he would sink Romney’s chances with seniors (Mediscare), lose Florida and possibly Ohio for Romney, and add little in the way of electoral gains. Who, I wondered, was Ryan’s natural demographic that he brought to the ticket? Not Latinos, not blacks, not women, no one except nerdy Wisconsinite wonks. I had every confidence in him to serve as Vice President, he has the intellect, gravitas, and competency to do the job well, but I thought his selection made him less likely to even get to that position. Now that he’s been chosen, I think I may have been wrong. He seems to be doing rather well in his politicking and campaigning, and anecdotally, I don’t think blue collar voters, or most independent voters, outright initially loathe him. After the Obama campaign ads come, that may all change. But so far, he has seemed to have done little harm.

            On to my main point. In attempt to avoid epistemic closure, I always try to step outside the bubble of right wing thought and blogs and read columns, articles, facebook posts, and blog posts from those with apolitical, centrist, and leftwing views. If you want to get the pulse on the more flippant, dogmatic left, head over to Reddit’s politics section. If you want to get a hold of a more measured, thoughtful segment of the leftwing community, go to somewhere like the New Republic or the Atlantic. And if you want to read stupid nonsense because you hate yourself and your brain and eyes, go over to Newsweek and read whatever bile they barf up for that day.

            Anyways, after the Paul Ryan decision I immediately scanned these sites to find that the left’s reaction to Ryan’s selection was mixed. On one hand, some welcomed his addition to the race, hoping that despite ideological disagreements, it would bring a much needed serious discussion to the campaign. On the other hand, the rank and file of the Democratic Party displayed a mixture of glee and indignation. He’s a Randian fanboy that wants to destroy the welfare state, they posted, and he’s going to sink Romney.

           There are a lot of problems with Paul Ryan policy wise (his support of TARP, the auto bailouts, the Patriot Act, etc) but what he’s right on is the need to tackle entitlements. His plan can be debated and its relative merits and demerits weighed out and judged accordingly. Yet, it is intellectually dishonest and dangerous to the fiscal health of our nation to assume that entitlement programs can continue on, unreformed, indefinitely. Federal unfunded liabilities total some $86 trillion dollars. If you want an illustration of this problem, look no further than to this chart kindly provided by the Congressional Budget Office and painstakingly pasted by myself:

What you should be paying attention to is the lime green (they really picked an ugly color) line. This is what’s going to happen if we do nothing. Public debt will explode. Eventually, interest payments on this debt will consume an ever-widening portion of Federal spending, crowding out other forms of spending. And this is in the best case. If bond traders get particularly aggressive, it is highly possible although presently unlikely that investors could lose confidence in their faith of the US government’s ability to pay its debts. As such, they will bid interest rates up even higher, potentially leading to a Greek like situation at worst, or even less money available for spending on other areas. Imagine, if you would, the bulk of your tax dollars going not to services or education or medicare or defense or whatever it is you like that the Federal government does, but instead to bond holders.

            This is a nightmare scenario, but unless something is done, it’s going to happen in some form. Paul Ryan, despite his many deficiencies, gets credit in my book for willing to tackle and engage with this issue. Even mentioning the word entitlements can cost a politico several thousand votes.

            What confuses me though is that so many on the left refuse to even acknowledge that this problem exists. Despite this being an inherently political issue, recognizing that entitlements must be reformed in some manner should not require ideology or partisanship to make. This is a factual issue. You can be an outright communist and acknowledge that America’s entitlements are in a bad state. It’s like seeing a burning building. How does saying, oh look there is a fire, require the political part of your brain to fire off neurons? It doesn’t.

            I’ve observed two reactions when I raise this issue in debate from leftwing people. First, refusal to even concede that there is a problem, or even an issue, or even a matter for slight concern. It’s all fuzzy math, they assert, designed by the right to scare people into passing austere and draconian cuts to the state. I won’t doubt that there is a political edge given to the right that comes from this fact set, but the facts still exist. If it were all an illusion, why are academics, bond traders, investors, economists, the CBO, Democratic politicians, and others all saying that it’s an actual problem? If this is some kind of grand conspiracy by the right, then why are so many non-political or leftist people raising the issue? The answer, of course, is the simplest one. It’s not a conspiracy, it actually exists, and something must be done.

            The second reaction I’ve encountered is one of flippancy. Simply repeal the Bush tax cuts and raise taxes on the rich and, voila, problem solved. As the WSJ points out (I know, evil Murdoch, feel free to engage in your two minutes of hate), if we were to tax the income of millionaires and billionaires at 100%, then we would only have “$938 billion.” Ok, great job comrade, the rich have paid their fair share, now what? There’s still trillions more to go, and that’s only addressing the budget deficit, not to mention the trillions in future liabilities. Let’s put aside what disastrous effects taxing the rich at 100% would have on the economy (one doesn’t have to be an acolyte of Laffer to see that that would cause serious problems), and now let’s look to other forms of income. The poor? That doesn’t make sense, since we are giving them money and they are, well, poor. Ah yes, here’s a group that has lots of surplus income, the middle class! It is a sheer fact of reality that if you want entitlements to continue at their current rate, you have to raise taxes on the middle class (and even that might not solve it). Yet, you’ll find few politicians, and even fewer die hard leftists, willing to admit this. If we want the entitlement system to continue on as is, we need to have tax rates approaching the levels of our European peers. We cannot have our cake and eat it too.

            And here, in closing, is where I don’t get why leftists are mocking and glibly dismissing Paul Ryan. The debate over entitlements is one we need to have. Reform will come, one way or another. Yet so far, in their refusal to acknowledge facts, the left has not shown up to the debate. Where is the Paul Ryan of the left? Let me say that again, where is the Paul Ryan of the left? Where is a policy proposal that reforms SS, Medicare, and Medicaid from the left wing perspective that doesn’t strictly rely on gimmicks such as raising taxes on the rich? Fine, raise taxes on the rich, and then what? The left is ignoring this issue at their peril. If they simply abstain from this debate, then they cede ground to the right allowing them to reframe reform on their grounds. In politics, first proposals count because they set the range on future and further proposals. In failing to offer serious policy proposals, the left continually cedes ground to the right.

            So here is my advice to leftists, communists, socialists, Democrats, liberals, or whatever other grouping out there. Talk about entitlement reform. Talk about it a lot. Come up with and then talk about what you plan to do. Entitlement reform is coming, and now is the time to sow your ideological seeds on fertile ground. Laugh at, mock, demonize Paul Ryan if you wish, but make sure you have a Paul Ryan of your own. Who dares, wins.

Inequality now, inequality forever?

                I’ve had the fortune of doing a lot of reading lately (mainly in the bathtub). As such, there’s been a swirl of ideas and arguments floating about in my head, looking for the best way to be expressed. I’ve considered breaking up this post in two, but for now I think I’ll keep it together and perhaps save some of my other thoughts for another day, another post.       

        What, you may ask, have I been thinking about? Inequality. Yes, it’s admittedly not a very conservative issue. Ask most libertarians or conservatives about wealth and income inequality, and they’ll either deny it exists (incomes may be different, but consumption levels are quite homogenized and equal) or explain the issue away by arguing that it really doesn’t matter. Income, and more generally wealth, inequality has always been a weakness of right-wing political thought, particularly in Europe. Why is it, some will ask, that my neighbor has and owns more than me? Is he not a man like myself, the person will further ask, and possessing the same needs and wants? Why then should he have more? These questions are further compounded when you have, as Europe did, a nobility that had great scores of wealth through little effort of their own. Marx went even further in his assault on inequality. Money, he argued, could not only allow one to purchase goods and things, but also time. Money liberates a person, allowing them to satiate their base needs and focus on activities and efforts that are not necessary but essential to the soul of a man. If you have enough money, for example, you don’t have to worry about working all day for food and shelter, but can spend your time traveling, learning, or doing a host of other activities with your free time. Right wingers didn’t go far enough, according to Marx. Yes, it is well and good to talk about political liberty in the sense of rights and freedoms, but you (the right wing) are missing the point entirely. If you don’t equalize wealth, you will never equalize liberty. The poor man will always be a slave, not of chains but of physical necessity. To have a politically free society, argues Marx, you need a materially equal society.    
   
      In the American context, cries against inequality have been relatively limited. America naturally lacked the idle, contempt worthy landed nobility of Europe. Instead, our wealthy mainly, but not always acquired their wealth through sheer effort, cunning, and aggression. The wealthy in our mind are not aristocrats but plutocrats; Gould, J.P. Morgan, Gates, Ford, etc. Combine this mindset with an economy that, until now, was generally growing for all income groups, and the pressure of the wealth gap is relieved. One may not care much for his neighbor’s disproportionate wealth if he or she is moving up the social and wealth ladder. Combine further these observations with the fact that, except in the 1920s and post 1980s, income and wage inequality was quite small in the US. The CEO or manager earned more, but not disproportionately more. Inequality, and the according class consciousness and warfare that results from it, have thus never been major American issues.             

  This is starting to change. The stagnation in incomes for the lower and middle income brackets in the US, coupled with the soaring pre-tax incomes of those in the top percent, has set the stage for a revival in American class consciousness and class warfare rhetoric. Witness the rise (and subsequent fall) of the Occupy movement or Obama’s recent charge against business owners that they “didn’t build that.” Even more worrying than the rising level of income inequality is the declining levels of social mobility in the US. See the hyperlinked New York Times article for more info. Income inequality by itself is a worrying issue, but added with the fact that not only do we have a burgeoning wealth gap in the US, but we also have less chance for those at the bottom to move up, and you have a worrying, and potentially volatile, situation. Returning to the neighbor example, it is bad enough if my neighbor has several Mercedes while I only have a Chevy, but it is even worse if I am trapped in a dead end job with no hope of ever obtaining those Mercedes through hard work and thrift. The partisan politics of the issue aside, an engaged and thoughtful observer should ask three questions when looking the issue of rising income inequality in the US.

1.       What the hell is going on?
2.       Can we do anything to fix it?
3.       Does it matter?              

 To answer the last question first, yes, income inequality does matter. Regardless of the causes of inequality, it is not stable for a democratic republic such as ours to have a vast chasm between the rich and the poor. This leads to resentment and institutional disengagement on behalf of the poor and elitism and contempt on behalf of the rich. Further, income inequality may lead to a worsening of the unquantifiable but ever so necessary societal threads that are necessary for democracy and capitalism to work. Trust, a sense of community, cohesion, and other such social elements are what I have in mind. Finally, capitalism seems to work best when it has a wide and deep middle class, with the productivity and consumer needs available to sustain both the supply and demand sides of the economy. These arguments do not necessarily imply that government should take an active hand in managing the wealth levels, as the left would argue, but rather that government should be concerned and ever vigilant against societal trends that would undermine its existence.       

        Having established that inequality is a matter of concern, let’s look at what’s causing it before we launch into noble but misguided solutions. As to be expected, there is a whole host of competing explanations for what’s going on. For the purposes of simplicity and clarification, let’s categorize them into two camps, a conservative and liberal one. I should stress here that conservatives and liberals do not fall neatly into either camp. I’m making a simplification here that unfairly ignores a lot of nuances of either side’s arguments, but damnit it’s my rarely updated and often neglected blog, so I’ll do as I please.         

      The liberal narrative goes like this. Once upon a time, greedy capitalists took advantage of their workers, endlessly squeezing every last waking hour out of them to make a profit. This lead to increased wealth for the rich, but an ever growing and disposed under class. The efforts of FDR and the erection of a bipartisan welfare state changed all of this. In the post war years, income inequality fell thanks to a swath of regulations made by the federal government. As a bonus, the economy boomed thanks to a large, confident, and growing middle class. However, things took a turn for the worse. That wild cowboy actor Ronald ‘raygun’ Reagan launched a twenty year crusade against the middle class. The rollback of regulations and the embrace of a free trade mindset led to falling wages for middle class workers, deindustrialization, and hollowing out of the middle class. Bush Jr. continued and expanded these policies, and we are now in a recession because of the death of the middle class. Inequality then results from a less active government that enables capitalists to go hog wild and run their BMWs and SUVs over the backs of the American middle class.

The conservative narrative is different. It argues that there is widening income inequality in lots of countries, not just the US. The stagnation in middle class wages is not a uniquely American phenomenon, but appearing in most developed nations. Canada, with its more protective regulations concerning worker’s rights, has seen the same phenomenon. If regulations were the issue, they argue, then why is income inequality rising in areas with more strident regulation than the US? Furthermore, while free trade has its downsides and the issue is far from clear, the US engaged in free trade before without the corresponding stagnation in incomes. Under the Kennedy administration, for example, there was a huge round of global tariff lowering yet wages for middle class workers continued to rise. The answer to the cause of inequality can be found in three reasons. First, technology has replaced the need for lots of unskilled labor and placed a higher premium on skilled, knowledgeable workers. Second, the industrialization of the third world, with China being the main country, has led to an increased amount in the quantity of unskilled labor, driving down wages. Finally, and most controversial, the social mores of the working class have changed.          

 Let’s look into this last claim a little more. In his latest book entitled Coming Apart, controversial AEI scholar Charles Murray argues that the social values and behaviors that enable the middle class to survive are starting to significantly fray. Inequality is not just the fault of capitalists, but also partly the fault of the workers themselves. It’s not hard to see why this point is controversial.

His arguments are born out of statistics. We know, from studies, that children born with a male and female parent have higher rates of success. We can quantify this success using such metrics as high school graduation rates, likelihood of teen pregnancy, college degree attainment, criminal convictions, and so on. Children born to a one parent household all have statistically lower levels of success in these metrics. That is not to say that there are not exceptions to this, but rather that it is observable as a general trend. Since many, if not all, of these metrics are highly correlated with financial success, it could be possible that the skyrocketing out of wedlock birth rates are harming the working and middle class’s chances for self-advancement. Indeed, there are studies that show that individuals who get married and have children within the bonds of marriage have a very high statistical chance of moving up the social ladder into the next income bracket.   

You may have seen this article from New York Times reporter Jason DeParle. In it, he makes the argument that Americans are increasingly separated by the institution of marriage on a class basis. This is, to put it mildly, extremely worrying. If marriage and these other middle class behaviors are starting to disintegrate, we will have a less mobile and more unequal society, with all of the social ills that brings about.          

Let us then ask what Lenin asked; what is to be done? To this question come the default answers, nothing or redistribute income. I’m not satisfied with either answer. Redistributing income is not only morally wrong, but also pragmatically ineffective as a policy. It may ameliorate the pains of the poor, but it does nothing to address the causes of this inequality. Further, it does nothing to address the related issue of social mobility.

If the conservative argument about inequality is correct, there may be nothing we can do on a political level. I am skeptical of efforts by governments of imposing morality. They are never effective and tend to backfire. What if this is a problem we cannot address through government action? Improving education may work, or it may not. Education says nothing and teaches little about internalized values and behaviors formed while young.

We could act to encourage and subsidize marriage even more than we do now, though this raises a dilemma for liberals. Do we act to reduce the causes of inequality even if it costs us the hard fought victories of feminism? I don’t know how that question will be answered.

Thus we are left with a problem that defies any quick or obvious remedy. The only way this issue can effectively be dealt with is if we take action on a cultural level, an action that does not look like it’s going to happen any time soon. There is an essential conservative truth hidden within the matter. Governments are constrained by the society in which they operate. They can nudge and change society, but they cannot undo or stop large social changes. If one wants to win the battle of ideas one has to first win the battle of culture.