Salon: How Econ 101 is Killing America

Robert Atkinson and Michael Lind’s analysis of the myths of economics that our overlords in government blindly believe really is a must read. For people who have been paying attention most of this is pretty clear and you’ll find yourself nodding affirmatively. Read it all. I wish everyone in the Beltway would read this and shake off the shitty, simplistic set of beliefs they rule us with.

When the U.S. economy faced little competition and was largely based on industrial mass production industries, it was perhaps not so bad that policymakers relied on Econ 101 as their guide to economic policy. But in a complex, global, technologically driven economy in which nation-states compete to capture markets and key links in global supply chains, relying on Econ 101 is like a physicist today relying on Newton. It’s time for economists to fess up and admit that theirs is not a science and that what passes for Econ 101 is largely misleading. But the public, the media and politicians shouldn’t wait, for it may be a long, long time coming. Rather, they need to understand that a dumbed-down Econ 101 version of neoclassical economics no longer should serve as a road map for economic policy.

Myth 1: Economics is a science.

Myth 2: The goal of economic policy is maximizing efficiency

Myth 3: The economy is a market

Myth 4: Prices reflect value

Myth 5: All profitable activities are good for the economy

Myth 6: Monopolies and oligopolies are always bad because they distort prices

Myth 7: Low wages are good for the economy

Myth 8: “Industrial Policy” is bad

Myth 9: The best tax code is one that doesn’t pick winners

Myth 10: Trade is always win-win

 

GOP Ignoring Election and Polls – Part Infinity

Last week I mentioned that the GOP (hell, everybody!) considered the 2012 election a referendum, but then just ignored the results. Polls continue to show the people support ideas coming from the Democrats and the White House, not the GOP, but the party leaders and  politicos are continuing their Borg-like pursuit of whatever the hell they want to.

Gun control?  Majorities of the population, even NRA members! approve of an assault weapons ban, limitations on clip capacity, trafficking controls and universal background checks (92%!). We’ll be lucky if we get the background checks through a recalcitrant GOP-led Congress.

Social Issues? The country is running away from the religious right stance against choice and equality. Not the GOP, they run at it. But it’s not noble like firemen running towards danger when we all run away, no. This is a lack of ability to change or evolve unless of course their son comes out to them and then they will agonize about it and (maybe) slough off a thousand years of prejudice for what should have always been in a democracy that was founded on “all men are created equal.”

Economy? 

A total of 77 percent of respondents said they’d support infrastructure projects to put Americans to work and 75 percent would support a “federal job creation law” that would do the same for a million people.

Anticipating criticism of the poll, Gallup asked the same question again, pointing out that each initiative would “spend government money.” With that addition, support fell slightly, to 72 percent.

Over and over and over again, people are way smarter than the Beltway Bloviator Class and their GOP opinion leaders that constantly keep leading us rightward, while logic, science, reality and the people go leftward. You know what, screw that, it’s not “leftward”.  It’s not “left” or “right” it’s what works versus what does not friggin’ work at all. It’s what’s proven, been there, done that got screwed versus what worked before and would work again if the people in power would allow it to happen.

http://www.nationalmemo.com/poll-even-republicans-support-government-spending-to-create-jobs/

It’s so tiresome to have the people constantly show in polls and elections that they think one thing and their leaders believe that they’re just joking they really don’t think that. I hear it in the gun debate. Despite polls, it’s just smart politics to kill an assault weapons ban because the 4,000,000 members of the NRA will overwhelm the other 306 million of us and hand the Senate to the GOP.

From Digby:

It turns out that roughly the same number of Americans describe themselves as conservatives as they did in the 1970s, while the number of politicians describing themselves that way has skyrocketed. And yet Democrats, even as they win elections and hold massive amounts of power in the government are still on the run, following these GOP politicians as they race ever further to the right.

From Sal Gentile of the UP Blog:

There are a number of possible explanations for this disconnect. For one, politicians are much more beholden to the donor class that funds their campaigns than they are to their actual constituents, and as political scientists have found, the priorities of the wealthy are vastly different from the priorities of the public at large. Another possible explanation is that voters are generally bad at expressing policy preferences in the abstract. They’re much more accurate — and, generally, more liberal — about their own views when answering specific questions about discrete policies, like whether we should raise taxes on the wealthy.

http://tv.msnbc.com/2013/03/09/study-politicians-think-voters-are-way-more-conservative-than-they-actually-are/

A.P.: “Republican Losses Obscure US Drift To Right” – We didn’t “drift” we were pushed!

The National Memo printed this state of the state of politics piece from the A.P. this morning that lays out that, despite public opinion and the GOP losing the popular vote in 5 of the last 6 presidential elections, the country has moved rightward politically.  

Conservative efforts have pushed the government rightward on taxes, spending and other policies, despite losses on some social fronts. One might say Republicans keep losing battles but winning wars.

But they don’t have the courage to say why and how that happened. We didn’t just “drift” rightward as if by a zephyr that just came along, an act of God, no explanation necessary. Just the contrary.  After the Goldwater debacle of 1964 wealthy right wing activists organized and developed a nearly 50 year long effort to PUSH politics and the judiciary to accept and adopt a pro-business, anti-regulatory, anti-tax, anti-worker agenda.  Their adherents in private talked mostly economic issues, but in public used cultural issues to hoodwink middle class and working class people (Nixon’s Silent Majority, the Christian Coalition) to vote for politicians who talk a big culture warrior game but under the radar were moving the country further and further towards policies favoring the rich.  The surface culture wars were mostly a failure, but they succeeded spectacularly in driving the Overton Window to the right on economic issues while devastating the middle classes. (See “Nixonland” by Rick Perlstein).

We continue on an inexorable leftward push culturally towards more freedom, justice and equality, to the chagrin of the ultimately flaccid religious-right culture warriors. The only real exception over the last 30 years was in the debate on guns, which has recently taken a severe turn leftward and may well mark the end of the NRA’s 30 year reign of terror over politicians.  Also, abortion rights have been gnawed away at representing the only real “victories” the religious right can claim – to have made it harder for women in some states to actually get an abortion. That struggle continues, but I suspect the growing political activism of young women will mark a liberal political turnaround in that battle as well in the coming years.

It is ironic that the East-coast, Wall Street economic elitist segment of the GOP and the western  libertarian Goldwater wing needed the religious right typified by old Christian Coalition in order to get Ronald Reagan and the Bushes elected and implement their economic policies. The Wall Streeters and libertarians don’t, for the most part, share the cultural conservatism and religiosity of the Pat Robertsons.  And ultimately, the anti-gay, anti-choice, pro prayer in schools people have seen their power to pontificate and move elections erode except in the reddest of red states.  Without the veil of God, guns and gays the plutocrats are naked and have trouble selling their agenda. 

But for 40 years on economic issues, neo-liberalism, which is a misnomer that represents a very conservative, plutocratic approach to finance, was very successfully insinuated into every economic debate and pushed the country very much rightward by this coalition on the right. This has been a very deliberate and planned effort by “movement conservatives” funded by very familiar names in ultra conservative and libertarian aristocratic circles.  Millionaires and billionaires like the Walton Family, the Koch Brothers, Richard Mellon Scaife, the Bradleys, Coors, etc. were recruited and organized into a concerted effort to push policies, especially in the areas of taxation and regulation, more amenable to wealthy plutocrats. Not just here in America, but through the IMF and the World Fund to spread the libertarian theories developed by Milton Friedman and the Chicago School of Economics, to the rest of the world.  (Please see “The Shock Doctrine, the Rise of Disaster Capitalism” by Naomi Klein) This is how a lobbyist like Grover Norquist can become one of the most influential people in D.C., even though until recently most Americans had never heard his name. Now almost everybody with an ear towards American politics is familiar with his no-tax pledge that was signed by almost every Republican elected in the last 10 years, and more than a few Democrats. 

GOP leaders and tea party activists routinely describe Americans as overtaxed. By historical standards, at least, it’s a questionable claim. In 1981, the top marginal income tax rate was 70 percent. Today it is 39.6 percent.

Federal tax revenues exceeded 20 percent of the gross domestic product in 2000. Under Obama, they have not exceeded 15.8 percent a year.

They quietly developed a long term strategy to overcome the democratic inclinations of the country and reverse the New Deal, the Great Society, and all liberal influences on governing. Think tanks were funded, newspapers and radio stations were purchased, colleges and universities were endowed.

  • Over time conservatives took over AM talk radio.  
  • The American Legislative Exchange is developed to push legislation (and legislators) at the state level, developing conservative ideas and politicians.
  • The Federalist Society indoctrinates young lawyers with conservative legal principals in order to get these young activists on the bench and over time, one judicial activist at a time, they developed the very conservative courts we have today, including the Supreme Court, that never finds in favor of individuals or unions over businesses, ever.

This effort was not counterbalanced by any similar effort on the left, on the contrary, the left seemed to become a moribund force in American politics after Watergate. The activists of the 60s seemingly declared victory and went home after Watergate, the end of the Vietnam war and the women’s liberation movement. As if to say, we have bell bottoms, what more could we want? In my opinion the left sat back and took it and did not fight back in any coherent fashion until the outrages of the Bush administration reawakened them and the candidacy of Howard Dean gave them voice.

Just look at the fact that Richard M. Nixon, a bona fide conservative in 1968, proposed a more liberal agenda than Al Gore or Bill Clinton did in the 90s and 00s.  It seems almost mind blowing that a conservative Republican created the EPA, signed the Clean Air and Clean Water Acts, was a gun control proponent and had a plan for universal health care that would make the Tea Party scream “Communism!” Obamacare itself was based on proposals by conservative think tanks like Heritage.

But that’s just the point, these shadowy conservative forces have moved the Republican Party way off the map rightward and in its wake pulled the Democrats as well towards a more centrist stance. 

Emory University political scientist Alan Abramowitz says the Democratic Party has become “essentially a centrist party, and has remained so despite losing its right wing since the 1960s as a result of the realignment of the South.” Meanwhile, he said, the GOP “has moved rather dramatically to the right since the ’60s.” The political middle ground, he said, “has also shifted well to the right of where it was 30 or 40 years ago on most issues.”

So something like an EPA today would be unthinkable from the Republicans and pretty much dead on arrival from the Democrats. Very much like climate control legislation – cap and trade. The GOP has adopted skepticism on science that would boggle the minds of the enlightened Republicans of the 60s, and in so doing have dragged Blue Dog Democrats by their tails back into the muck with them, leaving progressives alone on the field proposing ideas that would have been universally accepted 40 years ago as practical, scientifically sound, marketbased solutions!

Obamacare is perfectly illustrative of how now, 40+ years into the plan, 30+ years into the indoctrination of conservatives of the evils of Democrats and liberals, the thinkers that began movement conservativism have, like Frankenstein, lost control of their monster. So Heritage comes up with a market-based way to cover more people with health care (something even republicans once cared about) and Republicans push that idea in the 90s as a conservative alternative to the universal healthcare that they dread is coming. But when Democrats adopt such ideas as Hilarycare in 1993 or Obamacare in 2008, instead of declaring ideological victory, these plans are attacked mercilessly because (1) can’t allow a victory for a Democrat, and (2)  the true believers on the ground, the Rush Limbaugh/Fox News audience that has swallowed Democratic demonization for decades, impulsively declares these conservative ideas “socialism” because they came from Democrats. The GOP wizards behind the curtain find they can no longer control the mob mentality against their own ideas, so out of self-preservation even they have to turn and, laughably, denounce ideas they previously proposed.

So now you have a GOP that has an ever diminishing quiver of ideas that they can take out and speechify about.  They can talk about their goals of small government and low taxes, but cannot come up with actual governing philosophies that people actually like.  Taxes are already as low as they’ve ever been and the average American believes that in the face of growing inequality and a struggling economy taxes should be raised on the wealthy and we should spend more on jobs and the middle class.

The “thinkers” of the past generation that developed the plan are now passing into irrelevancy and the party has been taken over by the “feelers” who internalized the now 40 years of propaganda, 30 years on radio, almost 20 years on TV. You have a generation that bought into the lies told for political purposes that were created as a “a beard” to mask the real agenda of pro-plutocrat policies.  They are outraged, but their outrage is incoherent and aimed at the people who are actually on their side like Occupy Wall Street or President Obama. They have lost credibility but like a zombie army fighting only on muscle memory of what motivated them when they lived, they swing wildly not recognizing how ineffective they are.  They are the Tea Party and they have taken over the asylum.  

The conservative master plan hatched after the Goldwater landslide is now on life support as the left finally fights back with both hands.  The problem is the conservative judiciary, like a sleeper cell, is still there, typified by an evermore out-of-step Antonin Scalia, making the left’s battle back to a more equitable society just that much more more difficult. 

http://www.nationalmemo.com/republican-losses-obscure-us-drift-to-right/

http://www.amazon.com/s/ref=nb_sb_ss_i_1_18?url=search-alias%3Dstripbooks&field-keywords=the+shock+doctrine+by+naomi+klein&sprefix=the+shock+doctrine%2Cstripbooks%2C131

http://www.amazon.com/Nixonland-Rise-President-Fracturing-America/dp/B003E7ET0S

ImageImage