(Not) Draining the Swamp

Donald Trump had promised his voters that he would drain the swamp, which means that he would ensure that lobbyists and other special interests would not prevail in his administration and that he would place the interests of the whole nation before that of the special interests. With only a few weeks to go before inauguration, it is time to call him out on what turned out to be a non-promise.

The Trump Cabinet

Let’s start with a small selection of the people he had decided to appoint to his cabinet: Betsy DeVos, a billionaire, campaigning for the privatization of the public school system to use public dollars to benefit education investors like her and other buddies, became the secretary of education.

Steven Mnuchin, a high-level executive of the much detested Goldman Sachs bank, became the Secretary of Treasury, following in line with the tradition of appointing Goldman Sachs bankers to the manage the nation’s finances (after Robert Rubin serving under Clinton, and Hank Paulson serving under Bush; the former advocating for Wall Street deregulation and the latter throwing tax money after Wall Street following the great crash).

Wilbur Ross, a leveraged-buyout investor and billionaire making a fortune from buying up bankrupting companies, loading them with debt and then selling at his own profit, is going to become the Secretary of Commerce, ensuring that similarly shady deals will be performed under a Trump administration.

Andrew Puzder, a chief executive of a fast food company, who railed against minimum wage laws and favored accelerated automation of jobs so that pesky workers can’t bargain or strike for higher wages or better working conditions, becomes the Secretary of Labor.

Rex Tillerson, chief executive of Exxon Mobile, a giant oil corporation, who is very interested in making profitable business deals rather than maintaining balanced foreign policy, will be the Secretary of State.

Ryan Zinke, Montana Congressman, who voted for oil and gas drilling, will be Secretary of Interior, which is charged with overseeing federal land that might be tapped for oil and gas drilling despite the criticisms of environmentalists.

Scott Pruitt, Oklahoma attorney general who led lawsuits against the EPA for the Clean Power Plan (setting carbon limits for power plants) and Clean Water rule (limit pollution in the nation’s rivers, lakes, streams and wetlands), will become the Administrator of the Environmental Protection Agency.

Tom Price, Georgia Congressman and critic of the Affordable Care Act, will become Secretary of Health and Human Services, which is tasked with overseeing the implementation of the Affordable Care Act, especially the smooth running of the exchange.

Carl Icahn, multibillionaire investor, will be Trump’s special advisor to “cut red tape” and government regulations, which usually implies the same barriers that hinder investment profits, like worker safety or environmental standards. He advocates for a tax holiday for companies stashing their earnings overseas in the hope that the cash will be repatriated. (It is safe to assume that Icahn will benefit from such a move.)

Peter Navarro, a University of California Irvine economist raging against trade deals with China and the rest of the world for undermining US production and increasing US trade deficits, was selected as director of the National Trade Council.

Evaluation

The pattern of Trump’s appointment is that most of his appointments tend to be businesspeople, who will benefit themselves or their industries substantially by working directly for the government, or politicians, who have a vested interest in helping various businesses make more money. All of these efforts are likely to intensify the swamp. Remember that the reference to the swamp was about a broadside attack against a politicized (crony) capitalism, where the state helps lobbyists and special interests enrich themselves at the expense of taxpayers and the general public. But to appoint the very same special interests to become part of the cabinet is actually even worse than the current corrupt political culture of politicians currying favors with their donors. Cut out the middle man.

Taxpayer/ public-politician-business/ special interest

gets simplified to

Taxpayer/ public- business/ special interest

If your initial thought is that the Trump administration mean that the rich will get richer, and the working and middle classes that put Trump to power will be neglected again, there is strong reason to believe that this is exactly what will happen. Bernie Sanders and some other progressives are already calling for mass mobilization to ensure that social programs like Social Security and Medicare get defended (Fernholz 2016). Trump has not made it clear that he wants to slash entitlement programs, though he might ultimately not be opposed to it given that he did not invite any social policy academics or other left-wing representatives into his cabinet and staff of advisers.

“Speeches are in poetry, while governing is in prose”, is one of the proverbial pieces of wisdom in Washington politics. What this means for us is that the people have appointed their shiny charismatic leader, who is a skilled con man and TV celebrity, but this leader cannot govern without his bureaucracy. The bureaucracy then turns out to be drawn from the military, the Republican political establishment and the elite business community. People’s anger was targeted at the elites, but what they get back are the very elites, who can’t care less whether working people have struggle to afford their rent. The next four years will be a hell of a ride.

Now, it turns out that Icahn and Ross were major Trump donors, and they helped him stave off bankruptcy in the 1990s, when his businesses were in trouble. He is repaying his wealthy friends by appointing them to the cabinet. Trump is as much beholden to the big donors as Clinton, Bush and all of the other establishment figures.

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Consumption as a Curse

In a recent video, I argued that economic growth is not always beneficial, because rising economic growth is associated with rising inequality, spiritual unhappiness via the Keeping-up-with-the-Joneses syndrome, and because the environmental effects of endless economic growth are becoming less and less tolerable as climate change advances (Mr Liu’s Opinion: Is Economic Growth Unqualifiedly Good?). Today, I want to focus on the second point to argue that consumption is a societal curse rather than a boon.

Our culture tells us that we have to consume as much as possible or else we are not worthwhile human beings. Naturally, because we are still a liberal democratic society, the powerful in the companies and the government can not force us outright to buy as much as we can. So Edward Bernays had made the argument in the 1920s that what liberal democratic societies needed was the submission of the mass of the population to the consumerist order, where people’s opinions and habits are steered by the rulers of society. This submission is generated through relentless propaganda in the form of TV commercials, newspaper advertisement, public branding of firms, political campaigns, school instruction and news anchors telling us that we should buy Christmas gifts and shame on us if we waited until the very last minute to get a gift.

The latter example is really what had motivated me to write this post. My first association with Christmas, which I think is shared by many people, is an opportunity to meet relatives, to not be so stressed out about work for a few days and to enjoy longer sleep. These practices are implicit as part of the holidays, though it is used by more religious people to be reminded of the birth of Jesus Christ, a rather radical figure, who had the idea to spread the monotheist religion to Gentiles.

Unfortunately, I had the TV on, while being back home for a few days just to discover that the local TV station was reminding people of holiday shopping and showing the crowded shopping malls. Some of the TV presenters said in jest, “You really should feel guilty for pushing it up until the last minute to buy your Christmas presents”. The newscasters, naturally, do not reflect on why they are imploring people to loosen their wallets, and it does not seem that they have to, because the crowded shopping malls clearly show that the newscasters are merely reinforcing what already exists in US culture.

On a more benign note, people might simply decide to shop for Christmas presents as an affirmation that they care for one another, and loving thy neighbor or loving thy family at the very least is clearly very spiritual and very Christian. But there isn’t any obvious link to celebrating the founder of Christianity and gifts except the mythical story of the three wisemen gifting gold, frankincense and myrrh to infant Jesus. But why is the gift in the Jesus story linked with gift-giving in today’s world? Capitalist interests, especially in the retail sector, live off exploiting the story of Jesus for their own benefit, and by convincing people with the help of the complicit media that the circle of gift-receivers should be as large as possible and the spending per gift should also be as extravagant as possible.

Gift-giving is nothing peculiar to consumer capitalist society, and also existed in ancient societies. In Malinowski’s classic study of gift-exchange of the Trobriand islanders, gift-giving has a reciprocal element, i.e. gifts that were given out had to be returned with a gift of greater magnitude; the items that were traded were non-useful items like necklaces and armbands; the gift-giver had a higher social status than the gift-receiver; because most of the gift-items were under the possession of very few individuals in those communities, those same few owners had the m0st influence and power.

In today’s capitalist society, this element of social hierarchy is reproduced with gift-giving, because it tends to be parents, who give their children presents rather than vice versa. (This is a principle that is strictly enforced in my family where my parents refuse to even entertain the idea to let me pay for anything when we go out together.) Though the fact that children upon earning their own income then also become normatively obliged to buy gifts for their parents and other siblings shows that the ancient forms of gift-hierarchies become muddier.

But what I am really trying to say here is that in consumer-oriented societies the social rank hierarchies may or may not get reproduced, but it is all secondary to the commodity structure that filters these gift-relations. Gift relations are retained only within the family or friendship network, but given that most people nowadays don’t use their own mechanic skills to build a product from scratch, but instead buy the gift from the supermarket or online, there is priority for the commodity relationship. From the standpoint of the capitalist producer, he/she does not care whether the buyer or the gift-receiver consume the commodity as long as the buyer transfers the money to the capitalist.

Economic sociologists may be perfectly happy in just pointing out that money can be “earmarked” for specific purposes (see Zelizer 1997), or gift-items for that matter. But for me it is normatively not sufficient. The question, which I raise, is whether gift-giving is absolutely critical in the framework of Christianity? If we could say for sure that people’s moods are uplifted with practical acts of kindness, then we should by all means stay with gift-giving. If people have treated me well or if I hope to be viewed favorably, I would use gifts as a means of appreciation. But in the case of Christmas, we are institutionally required to hand out gifts, which evidently has nothing to do with an act of kindness but fixed social expectations.

It would be difficult to establish the different levels of spiritual happiness effects of a gift received at random when the gift-giver thinks the receiver deserves it versus a gift received during Christmas, but I would hazard to assume that the former produces a greater level of happiness for the receiver because the gift is linked directly with the individual person rather than the institution.

The conclusion that I make can, therefore, neither be to abolish gift-giving nor Christmas, but to question whether gift-giving should be intrinsically linked with Christmas and should require the combined propaganda of corporations, retailers, schools and media to mobilize the largest amount of Christmas shoppers with the most willingness to loosen their wallets.

Let us consider the problems: It is problematic that the innocent act of Christmas gifts can produce anxiety among lower-class children, whose parents cannot afford the nicest gifts. It is problematic that the consumer propaganda makes people feel guilty for not intending to purchase gifts for others. It is problematic that so many people return the gifts the next day because they don’t like them (which suggests to me that people might be better off with a gift card rather than gift items; I, for instance, only value books and only very few people would know the kind of books I would want to read, so I reward myself with “gifts” through online book orders). It is also problematic that gift-giving has been absorbed into the normal capitalist order.

Consumption that exceeds people’s genuine needs and controlled wants become a curse to the extent that our spiritual happiness (defined as long-term contentment rather than joy for the moment, eudaimonia in ancient Greece) is not increased, but to the extent that we are trapped in the hedonic treadmill, where only added increments of material goods can increase pleasure further. For most people not born with a silver spoon in their mouths, that means more exertion, more work, more performance, more overtime, more promotions, more bonuses, more raises.

Cheerleaders of capitalism claim that more consumption and hard work is associated with human progress. In capitalism’s creative destruction, there is, after all, a creative element in it. I am no opponent of progress, but I am an opponent of hedonistic consumerism, which shall not be confused with the desire to tinker and create new things, which make us very human and shall continue to exist under any social mode of life.

The stoics argued that contentment and satisfaction can only be received if our material demands on life are reduced to a minimum. We don’t have to go that far, and may appreciate the benefits of what has been created. But we can heed some of their calls to attempt to live a more fulfilled life. I come from everything but a rich family, and one of the most important lessons I received from my family was the importance of being very frugal on my spending habits. Capitalist propagandists would condemn me as a miser, who refuses to benefit the economy and spur the creation of new jobs (or celebrate me as a hero for generating high savings for the country’s investment, but we’ll go with the first argument for now).

But the frugality has also allowed me to not have the desire to cheat on people, so that I can have a temporary pecuniary gain. It has allowed me to maximize my leisure preference, which may have come at the expense of “productive work” for society, but has allowed me to live a life of the mind (albeit imperfectly), read an inordinate amount of books, newspapers, journals, write numerous blogposts, watch movies and documentaries, and join long intellectual discussions with bon vivant friends. I can scarcely imagine any better life, yet consumerism blocks the path toward such a free and content life for most individuals.

Some critics might object that most people may intrinsically have a consumer-good rather than leisure preference and that my intellectual preferences are peculiar to few other individuals like me. But how can such critics know for sure that consumer-good preferences are autonomous decisions? The standard libertarian has to assume that people intrinsically choose how they can maximize their own levels of utility, but to ignore the externality of influence through the consumer propaganda machine is short-sighted. It is true that consumer culture has formed the standard common attitude toward consumer-good preference, but we would not really know what people’s genuine preferences are unless there is a parallel universe or society where people are not exposed to the consumerist propaganda.

Ironically, it first requires leisure before people realize what they are really after and what really produces contentment in life. And in such case, there will be a much greater number, who will then voice their leisure preference, than what is the case today, while a few people nonetheless choose workaholism even when given the leisure, because work is the only thing that fulfills them. That would be fine too, because the work and consumer-preference would not result from coercion through manipulation (rather than coercion through force). We are ripe for the universal basic income to test the waters on people’s true preferences.

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2016 Does Not Mean We Are All Doomed: Lessons for the Left

In one of John Oliver’s shows immediately after the Trump elections, he had a segment condemning 2016 and being happy that such a bad political year will be over soon. There is no denial that we have had a horrendous year behind us: Brexit and Trump. I will not re-litigate why they had been bad choices for their respective countries (see my posts: Liu 2016a, Liu 2016b).

I will also not deny that the electoral choices clearly reveal the anti-establishment vote patterns that emerge from a national political class that is incapable to redress the economic and social grievances of a working class that is battered by international competition and growing automation, and the ethno-national uncertainty of a diversifying population. For that reason, any democratic vote in the immediate future will always be decided in direct opposition to what the establishment demands, since the voters rightly attribute their discontent to ignorance and helplessness of their own political class.

Democracy now mixes very uncomfortably with capitalism, because the latter pushes up inequality and the former cannot persist without sufficient equality. Something has to give and in the short term in Greece, for instance, democracy is losing, because electing a left-wing government means absolutely nothing. They can’t even hike their pensions without Wolfgang Schauble’s, the German finance minister’s, permission. France will face an awful set of choices in 2017, as the socialists are discredited, and the conservative right-wing (Fillon: pro-neoliberal, cut civil service and welfare) battles with the extreme right-wing (LePen: protectionism, anti-immigrant and anti-Muslim campaigns).

There is also very little doubt that some of the directional gains of political liberalism may face reversals, and some clear indications of that can be seen in Poland, Turkey, Russia or China. It is becoming increasingly less comfortable to be a member of the press or the political opposition in these countries. In China, the government has developed the Orwellian idea to assign points to people’s good behavior (e.g. visiting their parents) and deduct points for bad behavior (e.g. protest against government) such that everyone has an online profile and contribute to what the rulers regard to be a “good society”. Turkey’s Erdogan abuses the July 2016 coup against him to throw all of his political opponents either in jail or remove them from office.

We might as well bury our heads in the sand and never try to look out again, but my argument today is that not all is lost. Naturally, the default in a world of economic and political uncertainty is to have nationalist-protectionist and authoritarian sentiments prevail. But there are also signs for a positive turn in the global discourse.

First, notice the sharp negative global reaction to president-elect Trump’s statement that he might rip up the Paris climate agreement. This agreement has the intention to limit the rise in global temperature to 2 degrees celsius, which is rather ambitious given that we are already 1.2 degrees on our way there, and even if we were to shut off all sources of CO2 now, we would still experience more warming in the short-term given that it takes some time for the CO2 to be absorbed by the oceans or exit the planetary atmosphere. The serious effects of climate change even in the short-run imply that the economic growth-CO2 reduction tradeoff can no longer apply. It is when we face an immense and immediate planetary crisis that the world leaders are jolted to do something about it, even if they are intent only to save their own asses.

Second, wherever electoral opportunities arise, there are not only regretfully right-wing forces that arise, but also left-wing and progressive political forces. In Spain, a 2015 election catapulted the left-wing Podemos party to third place, which created a fractured political system and no government could be formed. A repeat election in 2016, increased the vote-share for the establishment Popular Party (Conservative), but Podemos was able to retain their seats. Popular Party has now formed a government but without a real mandate. The decimated socialists (PSOE) abstained, but Podemos now has the front row seats and can see the government’s austerity program further unravel.

In the UK, Jeremy Corbyn faced a direct leadership challenge in the Labour Party led by Owen Smith, who made an about-face from being a Blairite (e.g. his support for private-finance initiatives and farming the NHS out to private providers) to a Corbynite. The only selling point he made was that Corbyn was not a credible candidate, and it would be better to have someone who appeared moderate to outside voters, but would also push the Labour Party left-wing agenda. It was evidently a poor selling-point and he lost the leadership challenge. The Blairites have to lick their wounds and they have likely lost control over the Labour Party for many years to come. Will the Labour Party be able to win any UK elections? It will be difficult given that the loss of the Scottish heartland to the SNP in 2015 meant a severe blow to the Labour Party. Without being able to reach out to rural English voters, who are staunch Tories, there is no possibility for shifting the political fortunes for Labour. It is theirs for the taking given that the Brexit will be poorly negotiated by an outgunned May administration.

In the US, everyone has been lamenting the loss of Bernie Sanders in the Democratic primaries (including the author), and the Sanderistas are already riding the I-told-you-so wave against the Clinton campaign, arguing that Sanders would have easily won against Trump. I would support that view, but understand that it does not make much sense now to litigate the past and dream up counterfactuals. But we should remember the historic moment by which a self-described democratic socialist received 46% of the primary vote in a major political party. When Sanders went out to give his hour-long political education lectures on inequality and lack of college and health care access, there were tens of thousands of people, who showed up and were willing to listen to the new message. Finally, someone who took the working man and woman seriously!

Sanders is really only the third part of the progressive political narrative: the first part begins with the 2008 financial crisis and the bailout for the banks. We can debate whether the government did the right thing with the bailouts, but what matters here is the optics: people experience that the banks were able to get rich, be declared so systemically important that taxpayers should bail out these big banks, while they pay their top bosses with bonuses. In the mean time, people, who took out mortgages that they could not service, were forced to surrender their houses, and were all of a sudden morally to be blamed for what really was the combined regulatory failure of the government and the banks, who only cared about the housing fees.

There had previously been already economic losers in the US, whether it is the factory workers of the Rust belt (who now voted for Trump in larger numbers than Clinton) or service workers trapped in low-wage jobs and other personal problems like drug or alcohol addiction. But the 2008 crisis made it plain to the entire middle class that their position was no longer safe. We are no longer talking about marginal groups that can get stiffed. People were working longer hours for lower wages, but someone had to still articulate their troubles.

The second stage of the progressive narrative was the Occupy Wall Street movement. Political scientists like Theda Skocpol make a big deal out of the Tea Party and they have become an entrenched political force in the US. They are bankrolled by the Koch brothers, while the popular front makes it appear as if they expressed an anger coming from middle America. There is some truth to that, as rural white voters tended to show the strongest support for a movement, which was disgusted by the bailouts, by the Washington establishment, and had the desire to “have the government hands off my Medicare”.

But there was a left-wing antidote in the cities, which was the Occupy Wall Street movement, which began around September 2011 and ended about 2 months later. A democratic society usually tolerates public assemblies. In China, online regulators tend to be lenient on political criticism, but are notoriously harsh on cracking down on any kind of online activism that results in mass demonstrations or assemblies as that would directly undermine the political regime. But even in democratic societies rulers get really scared when people assemble over extended periods of time, because the extended socialization on public squares might create a larger movement that overthrows the neoliberal economic configuration, which serves the powerful so well.

The city and the police forces across the country coordinated rather well in getting rid of what they officially called the “public nuisance”. That is what the Hong Kong protesters also had to listen to. Here governments all over the world are the same. They cite the blockage of roads, public squares, hindering traffic and commerce, the defecation and urination on the streets, the noise and the stench as a reason to get rid of the tents and the encampments. But what they were really after was to crush the spirit of the movement, which could radicalize as long as the encampments were there, but wither away without them, despite all the social network activism in the world.

So OWS is dead and nowhere to be seen, right? Wrong, what survived was the legitimation of the class-based discourse. The chant of the occupiers was that the 1% got richer at the expense of the 99%. I occasionally read some academics, who have the desire to correct the simplifying statement of the 1% by focusing on the top 0.1% or top 5% or saying that these figures don’t help much, but what really matters is that there is something inherently wrong when almost all gains flow to the top 1%.

But the question of ‘what is to be done?’ still hung above us after the failure of OWS, and here we fit Bernie Sanders into the narrative, who announced his presidential candidacy in the May of 2015. Would Sanders’ message have resonated without the financial crisis and OWS? I doubt it. Now, we have to move to stage four and win elections.

It might very well be that a fascist wave will take over and engulf us in political darkness before any progressive leader can step in. But those on the left have no reason to be discouraged as long as we have the political resources to fight back. The world is ours for the taking.

 

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President Donald Trump: Why? What Next?

Most of the pundits and my liberal friends did not think that Donald Trump could become the president of the United States. One may say that he is even an illegitimately elected president, because he received over 300,000 fewer votes than Hillary Clinton, which implies that she won her states with bigger margins than Trump won his. But that does not matter, because our Electoral College system privileges the majority within the Electoral College. All the electoral votes in a state go to the candidate with the plurality of the votes in that state rather than proportionally according to the relative vote. But Clinton has already conceded defeat, and Trump gave his brief victory speech, where he did not outline any policy but merely promised to heal the “divided” nation, whatever that means.

There are two pertinent questions which arise: (1) why did Donald Trump win the election? and (2) what kind of policies and policy environment can we expect under a Trump administration?

Why Donald Trump Won the Election?

The first question is undoubtedly easier to answer than the second, but I shall venture on my guesses. Let’s begin on the first. I will briefly say something about explanations, I don’t find convincing: I reject the claim that third party voters spoiled the vote in favor of Trump, because the overall support for the third parties was rather negligible. I also don’t think that misogyny kept Clinton from the White House, in the same manner that racism didn’t keep out Obama in 2008. I will also reject the claim that half of Americans are racist. There is no doubt a sizable number of racists and secret racists in the country, and they have backed Trump, but not every Trump voter is a racist.

(a)  Hillary Clinton represents the hated establishment, which many people don’t like. During previous election cycles, few people would have cared whether the leading candidate belonged to the establishment. I have argued previously that screwing working people with stagnant wages, rising health care and education costs and growing economic insecurity will create electoral backlash. The establishment had no interest in the plight of those working people, and thought it was more convenient to do big fundraisers with the 1%. Clinton epitomizes the establishment, because she has been part of the national Democratic Party for 25 years if you count the time with her husband. She was mired in a cloud of scandals, which the news media fired up, and she lacked the charisma to communicate to people why they should support her (very much unlike her very charismatic husband). Because of her establishment connections, it didn’t even matter that her policies were more to the left than her husband’s 25 years ago (mainly due to the Bernie Sanders effect). What matters is the public perception of mistrust. It also did not help that the president and the previous presidents and other Republican establishment figures were backing her, because that lowered her credibility among establishment skeptics.

Trump was not part of the establishment, even though he was a businessman getting rich off that corrupt campaign finance system, which he even admitted in his rallies. He vowed to fix it, though not how, which suggests he has no serious policy ideas, but what matters are not the sanity of policy proposals, but the sentiment of the anti-establishment spirit, which he embodied. The media and the liberal public was chastising him for his sexism and bigotry, but that actually increased the appeal of Trump among his supporters. They felt the political incorrectness was a breath of fresh air. Political correctness for the Trump supporters is really a way to silence their grievances, which they think they have a right to air, and Trump was the figure, who was never shaken by any scandal directed against him. In fact, he deflected any scandal against him, and threw spoonful of allegations back against Clinton. That made him the decisive anti-establishment figure.

(b) The angry white working class around the rustbelt turned out in larger numbers. Clinton clearly won a vast majority of the black, Latino, Asian and female vote, so there wasn’t much false consciousness among the different demographic groups that Trump derided. But their groups are still a minority and if their turnout is low, because of lack of enthusiasm for Clinton, then the very enthusiastic Trump supporters sway the elections. Michigan, Pennsylvania, Ohio, Wisconsin and Florida all went to Trump. With the exception of Florida, these are all rustbelt states, which heavily relied on steel, car and manufacturing plants for employment. They have been the losers of globalization, automation and the motions of capitalism. Opioid addiction, alcohol addiction, suicide, early death, unemployment are all problems there. Almost all of the income gains are concentrated in the top 1% of the population.

The Trump supporters are the most angry about the Clintons having sold them down the drain in the 1990s with the free trade agreements, which had bipartisan consensus. Even though Clinton later backtracked on the free trade agreements (for electoral reasons, because I think she would have negotiated the TPP once elected to “assert American interests”, like Obama has) and her tax and job initiative policies would have helped the white working class men more than any shady initiative by Trump, it didn’t help her. The optics were so much turned against her. Trump, however, championed these voters in the many well-attended rallies he had, because he promised them that jobs would come back when he rips up trade agreements and imposes tariff barriers on foreign imported goods. It was all a hoax because the tariffs won’t bring the jobs back, and I don’t think he will rip up the trade agreements because of his close ties to business people, but that didn’t matter, it’s the optics that mattered, and people need something to hold onto.

(c) The left-wing crowd was not enthusiastic about Clinton. This point does not need much elaboration. One of the reasons why Bernie supporters are correctly saying that he would have received more independent votes than Clinton is because the left and many in the center would have strongly supported his policy positions. He would have been competitive in some Republican states in a way that Clinton could never dream about. It is true that most Sanders backers swung around to vote for Clinton, but the enthusiasm gap for Clinton has cost her some votes, probably in the form of abstention. Another interesting detail was that the African American vote now was smaller than in 2008 and 2012, which would suggest that the Obama-boost, as first African-American president, cannot be completely denied. But a Trump-Sanders showdown would have been fantastic for the dynamics in US elections, because both do not represent the establishment and would have galvanized both of their bases, while the actual election galvanized the Trump voters but not the Clinton voters, who had the best advisers, campaign funding and canvassing strategy, but no general enthusiasm.

(d) Trump has charisma. Charisma, according to Max Weber, is a mythical, magical quality in a leader, which inspires followers to support this leader. His charisma is in part cultivated with his experience as TV host and as businessman, negotiating contracts and getting “good” deals. It does not even matter what the results are, because he had lost a lot of money in lawsuits and failed investments and his policy proposals are flimsy and superficial. Only experts can uncover Trump as a charlatan, but that is not what most people want to hear. I have people in my family and among some friends, who are devotionally inspired by the Trump campaign, because he blurts out what he thinks, even if what he says is not deep at all. Clinton desperately tried to hammer Trump on his sexism, racism and bigotry, and the low-point of the Trump campaign according to mainstream media and the politically correct sectors of the country (like Ivy League universities) was reached, when he made approving comments of grabbing women by their genitals. But that racism and sexism framework being bad (e.g. trigger warnings) only works in parts of the country.

The white working class turnout, which was decisive for his victory (ironically, a shrinking part of the electorate, which implies that future Republican candidates have to increase mobilization even further if they want to be competitive in future elections), reflects not the direct approval of Trump’s bigotry, but the liking of his authenticity. He says what he thinks, which is very much unlike the establishment, which has to formulate very sweet words. The more outrageous things that Trump said, the more authentic he became in the eyes of his ardent supporters. Trump by marking himself as against the establishment could take the liberty of pushing the boundaries of what can be said.

With Clinton the opposite impression is true. If you watched her during the debates you will see her very well thought-out and careful statements, every word having been spin-doctored and rehearsed. There wasn’t any emotional touch that she could create with her audience. This outward appearance is not relevant to policy wonks like myself, who are only interested in what policies the candidates had to present. In fact, if policy content was the only thing that mattered, then Clinton would have won the elections. But the country does not consist of policy experts, so we need to have the charismatic leader. People need leaders, who can inspire them, even if the policy content is fake. If you consider the Republican primary debates, all of the candidates were actually very much alike on the policy content, but you could also see the wooden tone and the artificiality of the other politicians, who have experience as politicians. All that Trump had to do to gain more popularity was to show that he was outwardly different from them, that he was a businessman non-establishment candidate, who can shake things up from the outside.

What Policies Can We Expect from a Trump Administration?

What Trump’s victory boils down to is massive discontent against the establishment, because it has not delivered on the needs of the working class, who were sold out by their leaders and the capitalist economy, which pumps profits for the bosses rather than take care of their needs. If that is the case, then the question arises what it means for the country politically. Will Trump be able to deliver on his promises to (1) rip up the trade agreements, (2) revoke environmental and business regulations (“red tape”), (3) reform the tax code (i.e. give tax breaks to the rich), (4) build the wall with Mexico and deport illegal immigrants, (5) repeal Obamacare, (6) appoint conservative Supreme Court Justices?

On a policy-level all of these proposals are very concerning, and I have no doubt that the “little guy”, who has put him into power, will not benefit from any of these policies. Trump is intent on doubling down on trickle-down economics, a slap in the face for his white working-class supporters. Trump is after all a member of the billionaire class, and he had a natural indifference to the people below him, which is evidenced by his refusal to pay of contractors and workers in his businesses. There is no reason to assume that simply because he called out the corruption and he is above the campaign-cash (which turned out not to be true: he got money from some rich people) that he will not serve the people of his own class.

The best predictor of his economic policy will be the kinds of people he will appoint to his cabinet. The Financial Times circulates the names of high-level Wall Street bankers and investors. Steve Mnuchin (former Goldman executive) and Wilbur Ross (distressed asset investor) as Treasury secretary. Other economic advisers include Lawrence Kudlow, former chief economist at Bear Stearns, and Steve Moore, conservative Heritage Foundation economist (Fleming and Donnan 2016). The entire anti-establishment sentiment is directed against Wall Street, but Wall Street will be the fox guard the hen house.

The policy proposals are visible too: Trump will work closely with the Republican Congress to massively slash taxes on the rich, who are supposed to get an average tax deduction of 13% as opposed to 4% for the general public (Rubin 2016). Before people are jumping up and down for the lower taxes they now have to pay to the government, they should consider that people also rely on social programs like Medicare and Social Security, which are also on the chopping block on a Republican administration. The Republican Congress will likely also work together with Trump on reducing the power of the EPA, and perhaps even phasing it out. They will want to benefit the coal, gas and oil industry and accelerate climate change, which Trump considered to be a hoax. He does not care about any externalities to business activity, and we should race headlong into a warmer future without doing anything about and defunding any scientists, who do serious climate research.

It is questionable whether Trump will deliver on his plans to build the wall, but what is for certain is that doubling down on deporting illegal immigrants is actually not such a great departure from the status quo. Obama had the double-faced policy of massively expanding deportations while protecting under-age undocumented residents in school from deportation. Trump wanted to give a huge boost to the prison and law enforcement agencies anyway, so deportations are a natural method of getting there. Being tough on immigration is politically one of the easiest things to do, because the frightened natives can quell their subjective fears while the veto power is relatively small, as non-citizens have not entitlement to vote and punish the current leaders.

Ripping up trade agreements will be much more complicated. He might derail the TPP or TTIP if he does not actively promote these agreements. Drift will result in policy failure. On the other hand, his commitment to destroy NAFTA, PNTR with China and CAFTA is more difficult to accomplish. It is easier to say no to what will come than to destroy what is already there and has vested interests in support. Trump prided himself to be independent from the lobbyists in the business community, but given that he will appoint people from the business community, he is signaling policy continuity to that business community, which does not want an end to the trade agreement. The Republican Congress is unlikely to back him on retreating on the previous trade agreements, because the entire party is owned by the business class. But the trade agreements are a centerpiece of Trump’s campaign, though he will know how to sell himself and weasel his way out of it.

Repealing Obamacare is a genuine possibility and it is possible to attack the fragile law by upending cost-sharing (which subsidizes high-risk insurance plans, i.e. plans with many sick patients) or repealing the mandate, which would reduce the number of insurers on the exchange, because they are banking on everyone paying the penalty or signing up for their insurance plans, and repealing the mandate would remove such impetus. But the difficult calculation for Trump will be that if he repeals Obamacare, it will immediately remove 20 million people from health insurance, which could create a massive political backlash because it is easier to prevent new benefits than to remove benefits on which people already rely on. This might be a risk that Trump is willing to take given that he is not a natural politician and would treat one or two terms in power as equally satisfying.

The Supreme Court will become substantially more conservative. The Republicans have blocked the appointment of a new Justice for almost a year after the death of Antonin Scalia. Trump has signaled that he will appoint the anti-abortion, pro-corporate Justices, and there is no doubt that he will be successful here. Ruth Bader Ginsburg is 83, Stephen Breyer is 78 and Anthony Kennedy is 80, which means that within 10 years there will be three new Supreme Court Justices (unless they each live until 100). Ginsburg and Breyer were both liberal Clinton appointees, while Kennedy is considered a moderate conservative. If we add the three more conservative judges to that there could be six out of nine justices that are right-wing justices.

Conclusion

Does the Trump presidency offer any positive prospect for the country? Slavoj Zizek thinks that even as Trump is a horrendous candidate for power, he will move forward the dialectics. The reasoning here is rather simple: it has to get worse before it gets better. The German Communists were happy that the economy descended into chaos in the 1920s, because that would make it easier for the communists to succeed. But will that really happen? Hitler came first and imprisoned the communists. Communism succeeded in East Germany under the direction of the Soviet Union, but crumbled under its internal contradictions in 1990. But there is no genuine reason to believe that history will have such a dialectical movement. Where are the forces of revolution to emerge out of the carnage? And even if it were true, I find it ethically questionable to tolerate a deterioration of the current reality for people.

But, of course, I get it. Let us not forget that this was not a pro-Trump, but an anti-establishment election. The costs that are attached to a Clinton presidency would perhaps be economically smaller (Clinton would not have been as progressive as Sanders, but she was fairly close at that stage), but politically it would be bigger. Her win would have suggested that the elites can continue celebrating the party among themselves, and maybe hand just one or two extra crumbs to the crowds. Let us not forget that an essential part of the Clinton strategy was to give big speeches in the big banks, do fundraisers with Hollywood actors, cozy up with big industries and lobbyists, and hire the pollsters, the pundits, the campaign shenanigans. Her victory would have sanctioned the status quo, and none of the voters want that. The fact that we still have the institution of democracy means that people will resort to the protest vote until their situation gets objectively better, whether that’s the Greek bailout referendum, the Dutch referendum on the EU-Ukraine association agreement, the Brexit referendum or the Trump victory. As it turns out, Trump is following his class instincts, and I expect him to change less about the status quo than his supporters would have hoped for, but that does not change his voters’ views of Clinton.

What it all boils down to is that Trump is a marketing genius, who in his businessman manner was capable of selling his white working class a dream about a better economic situation, but has to sell them out in practice. We are in for some exciting times, though this is not meant in a positive way.

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SEPTA on Strike: More Workers Deserve a Union

SEPTA, the southeast Pennsylvania transit authority, which is one of the largest public transportation companies in this country had decided to go on strike, citing dissatisfaction with benefit and wage conditions proposed by management. Drivers complain about a lack of break time and limitations on pension benefits (which are uncapped for management) (Laughlin 2016). They have negotiated a contract for the last few weeks, hoping to avoid a strike. But there is a certain historical pattern to these strikes. It is the eleventh strike, the last one being in 2009, which also happened to be my first year in Philadelphia. I was also dependent on the buses to get me home. Growing up in Austria, industrial relations tend to be a lot less controversial, though more workers are covered in unions and labor laws and protections are overall stronger.

Wikipedia (“Septa”) says that SEPTA has had more strikes than any other transport agency in the US. SEPTA is owned by the local county (Delaware Valley), serves 3.9 million residents, has 307 million trips per year, and has 5,700 drivers and operators. Some would say that 5,700 operators are holding a whole city hostage. Many people, who rely on SEPTA to go to school, work or to the doctor now have to scramble to find alternatives to get to where they need to go, such as carpooling, Uber, walking, or bicycling.

But what is strange to me is that the public discourse is so strongly opposed to the transit operator strike. How dare these people go on strike? Part of the reason why the opposition is so strong is because labor unions have become so weak that it is rather unlikely to see any strikes by any group of workers. It is the triumph of the management and the leaders of this country to have established an anti-union hegemony, which then also gets repeated by other working-class people.

The only way for the working class to press their interests against management is by showing solidarity with other workers. Given that there are only a limited number of drivers and their service is so vital for the community, they have so much power if they decided to band together. Imagine if all the 1 million Walmart workers could coordinate for a strike. They could double their pay overnight. Prices would go up a little, but profits will still be there, reflecting the higher rent incomes for the Walmart owners. And these are important jobs too: imagine management consultants, lobbyists and lawyers going on strike: they earn a lot more money, but the country would not stop working without them.

What the SEPTA strike reveals to me may in the worst case situation be a last stand of the working class, but it could also reinvigorate a labor movement, because people do not forget that a strike is still the most effective way to redistribute income from management to the workers. It is wrong for other members of the working class to begrudge drivers for their decent incomes, which should spark emulation rather than envy via union organizing efforts.

The unfortunate reality is that there are only very few workers, who are as privileged as the SEPTA drivers. Most of the employment that communities have are in the low-wage service industry, in hotels, bars, restaurants, retail shops, in Uber taxis, but also in hospitals, schools and universities. It is the most proper to organize these workplaces. (Princeton graduate students are apparently interesting in forming a union, though the graduate student government declared itself to be “neutral” on this issue: seriously? A student government that is supposed to represent the student workers’ interests?)

Some right-wing critics are running around with the meme that a higher minimum wage, unions and wage demands will accelerate the automation of service industry jobs. But those critics are making a wrong trade-off. Automation will happen regardless of whether there is any upward wage pressure. As soon as management receives new machines, which have the potential to offset labor costs and raise profits, they will install it at any given wage. For the workers it would be foolish to be afraid of automation and self-flagellate by refusing to make a better living and feed their families. Automation on such a large scale with tremendous effects on community life requires a smart government policy in response, which includes industrial policy for employment creation and/ or the universal basic income. The rational calculation of the workers, however, is to always demand higher wages.

The automation phenomenon is admittedly nothing to be scoffed at. Some SEPTA managers might subscribe to newsletters of tech magazines that promise that self-driving vehicles will soon come out. Managers are really looking forward to cash in when that time comes. Perhaps in a few years, self-driving buses and subways will completely remove the need for human operators. Some subways do not even use any human operators anymore. It is commonplace for many subways to have human operators, but they literally just sit and let the autopilot do the driving and operating the doors in the stations.

But as I said, these facts should not affect the tactical strategy of SEPTA driver union negotiators, who need to negotiate fair contracts for their members. It is the responsibility of public policy to ensure that all people can receive new jobs or a social safety net.

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Presidential Body Language: A Microsociology

Both major presidential contenders, Hillary Clinton and Donald Trump, cannot miss out on the Alfred Smith dinner, which sells expensive dinners to business people and political leaders to fund Catholic charities “to support the neediest children of the Archdiocese in New York, regardless of race, creed, or color” (Wikipedia, Alfred E. Smith Memorial Foundation Dinner). In such a high-profile event, the charity tends to be able to raise more money, so they raked in 6 million dollars in one night. Clinton and Trump both attended the event and were strategically seated next to Cardinal Thomas Dolan.

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Source: Q13Fox

Both of the presidential candidates deliberately look relaxed, as if they were enjoying the dinner. When Trump was called to do the speech, he had to go past Clinton to get on the podium and even tapped Clinton on the shoulder. The speeches themselves were entertaining to read, as they were knocking each other for their weaknesses. Trump called Clinton corrupt (Trump transcript), and Clinton called Trump out for his bad temper and bigotry (Clinton transcript). Clinton’s speech reads more self-deprecating and self-critical than Donald Trump’s, who even in a scripted speech displays greater level of boastfulness.

The more interesting part of the dinner was when the two shook hands, which is a simple gesture, which they tried to avoid during the presidential debate. It seems to be that the dinner was considered to be a more entertaining event, and they could let their guard down somewhat.

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Source: CNN

What is absolutely key is to observe the body language in this brief interaction. Clinton’s body is positioned as far as possible away from Trump. She can make this possible by stretching her right arm as long as possible. She is not as tall as Trump and can afford to stretch her arms and still catch his hand. The upper arm is slightly tilted downward and the lower arm is parallel to the ground. Her face is only visible sideways, and her mouth appears to produce a smile, but upon closer look she is not smiling as much as feigning the smile. One might interpret this fake smile with teeth clearly visible with the feeling of disgust or discomfort. This emotion fits well with why she would want to position her body as far away from Trump as possible. I interpret her body language to reveal her desire to end the interaction as quickly as possible. Clinton is known to have many spin doctors help her out with what to say, how to craft responses and how to behave, but, surprisingly, she is showing her emotions quite strongly in this direct interaction with her opponent.

Now let’s look at Trump. Trump does not have any proximity issues. His upper arm is almost parallel to his body and orthogonal to the ground, and only his lower arm is stretched out, which suggests that he has no problem to reduce the physical distance with Clinton. Notice also that his body is leaning forward, which is in opposition to the stiff and straight Clinton posture. It is not clear whether Trump genuinely relishes the interaction, but he is certainly not afraid. This might be a reflection of a gender dominance pattern, and we have certainly heard much about Trump and his relationship with women. Trump’s face has a rather neutral expression, so I can’t read much emotion into the face. It should be noted, however, that he squints with his eyes, which might reveal a feeling of suspicion. Unlike Clinton, Trump does not even bother to fake a smile. Meeting an opponent for the highest office in the country is likely less pleasant than meeting one of the many Miss Universes he is used to hang out with.

What can’t be read from the image is how tight the squeeze is during the handshake, but Clinton’s female hands are clearly smaller than Trump’s male hands, which allows him to surround her hand completely, while hers rests firmly in his palms. I don’t know whether this is normal for cross-gender hand-shakes or whether there is a typical male-dominance pattern that is involved here.

The second photo with the handshake stands in stark contrast to the first photo, where the two candidates were sitting apart from each other and could enjoy their dinner physically separated. The distance allows them to hide their true emotions, and put in a big laugh after each joke. It is the handshake, which is the prototype of the direct confrontation, which reveals their true selves.

One should not think that because one of the two will occupy the highest office in the country that they have lost their humanity. They are still human beings, whose real feelings and sentiments get revealed in their micro-social interactions.

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Responding to Left-Criticism of UBI

A criticism of the universal basic income from the left (Roberts 2016).

Roberts claims that a UBI does nothing to alter the class power relations in society (technology owners will remain owners), and that the right-wing would support UBI only if it lowers the cost of labor. On the latter point, it will be a struggle to define a UBI that is sufficient for the necessities of life, while still enforcing strong wage claims on those still in employment. The counter-argument would be that UBI would raise the reservation wage, which suggests an upward rather than a downward pressure on wages. We’ll just have to see where the chips fall.

On the first point, I would also question the current power structure, but being discontent with current ownership structures is NOT an invalidation of the UBI. We might say that under technology-nationalization the UBI becomes more independent of the political ruminations of the current private owners to willy-nilly refuse tax payments, which could undermine the financing of the UBI regime. But the second best option of retaining private property and have a technology tax finance the UBI is still technically feasible. But both objections are not substantive enough to undermine the benefits of UBI.

Roberts has a strong preference for work shortening and full employment, which suggests that a UBI would not be his immediate priority. But the libertarian inclination in me, which suggests that people are supposed to be have the freedom to reject an abusive or bad employer, would prioritize UBI, though I will never oppose full employment and work-shortening proposals. Either way, full employment and UBI would have to lower the current asset mountains of the 1%, which is indubitably contentious.

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