The passing of Christopher Hitchens this week has created countless articles about his life, his work, and his impact. A lot of it is flattering. Some are critical and harsh - though as these articles point out, Hitchens believed you should write honestly about someone even once they have died. So if that person was terrible, you should still feel free to write that.
My feelings on him are more mixed. On his positions, I think he was too harsh towards Mother Theresa. And while I am glad he is so vocal about Kissinger, I can't quite reconcile that with his full-throated support of the Iraq War and the War on Terrorism generally. Though his piece on water-boarding was smart (and yet he didn't seem to attack those who push that policy - the same people that pushed the war).
But I loved his thoughts on atheism and why religion is bad for society. I don't agree with it, but his thoughts and arguments were so well constructed.
In fact, I think the way most felt about Hitchens was that because he is a strong debater / arguer, you want him on your side. But if he isn't on your side, you hate him. He was pugnacious and intense, but definitely logical and pretty well-read.
What I really appreciated about him was how seriously he took debating and writing. I think we need much more of that - not what we see on TV, but more like what you would get in a Hitchens debate. Debates should be very smart and informed but also tough and combative. We should be able - in fact we should love - to debate with the other side. I'm not saying anyone will come away changing their mind, but creating a culture where debates happen - where ideas are tested - is necessary.
I'll let you in on a dream I have. I dream of creating a popular debate forum - one that is part Hitchens and part John Stewart (his good interviews with conservative guests on the Daily Show), where really smart people can take a really long time debating relevant issues. I saw glimpses of that when Hitchens would square off with someone. And I want to see much more of it.
Tuesday, December 20, 2011
Thursday, December 15, 2011
Oppose Just Because
After watching a Republican president deal with a difficult and unpopular situation and now a Democrat deal with a different but difficult and unpopular situation, I am convinced that in these cases, the opposition party often just makes sure to disagree with the leader without any good solutions.
The first situation I am talking about is Iraq before the surge. At that time, the Iraq War was going very badly - it was unpopular and Bush was being criticized for the very poor management of the war. Democrats at that time played on the president's unpopularity by attacking the war. But the only solution they offered was to leave, even though leaving meant allowing the country to devolve completely into civil war. Fortunately, Bush pushed through the surge - and even more fortunately the Sunni awakening happened at the same time - and Iraq came back from the brink.
The second situation is the current economic malaise and Obama's handling of it. There is unemployment near 9% and interest rates that cannot get any lower to create growth. Republicans will not support fiscal stimulus and even oppose further easy money policies (calling it treason). They use the economy to beat up on the president but offer no real solutions. Their one big talking point is decreasing regulations, which is not at all serious (though admittedly would do less harm than Democratic proposals to pull out of Iraq).
The major difference is that Bush was able to push through the surge in spite of Democratic objections. So he saved Iraq despite Democrat's opposition. Obama is unable to do anything similar for the economy.
What is important is that in both cases, the best solution is / was more of what the president has / had been trying. For Bush it was more troops. For Obama it is more stimulus (and easy money). But the opposition party cannot admit that what the president was doing was right but not enough, especially when that is unpopular. So the best they can do for themselves is to oppose everything, let the situation deteriorate, and reap the political rewards. Sad.
The first situation I am talking about is Iraq before the surge. At that time, the Iraq War was going very badly - it was unpopular and Bush was being criticized for the very poor management of the war. Democrats at that time played on the president's unpopularity by attacking the war. But the only solution they offered was to leave, even though leaving meant allowing the country to devolve completely into civil war. Fortunately, Bush pushed through the surge - and even more fortunately the Sunni awakening happened at the same time - and Iraq came back from the brink.
The second situation is the current economic malaise and Obama's handling of it. There is unemployment near 9% and interest rates that cannot get any lower to create growth. Republicans will not support fiscal stimulus and even oppose further easy money policies (calling it treason). They use the economy to beat up on the president but offer no real solutions. Their one big talking point is decreasing regulations, which is not at all serious (though admittedly would do less harm than Democratic proposals to pull out of Iraq).
The major difference is that Bush was able to push through the surge in spite of Democratic objections. So he saved Iraq despite Democrat's opposition. Obama is unable to do anything similar for the economy.
What is important is that in both cases, the best solution is / was more of what the president has / had been trying. For Bush it was more troops. For Obama it is more stimulus (and easy money). But the opposition party cannot admit that what the president was doing was right but not enough, especially when that is unpopular. So the best they can do for themselves is to oppose everything, let the situation deteriorate, and reap the political rewards. Sad.
Thursday, December 01, 2011
On the Economy and No Lost Decade
So I've been thinking about the long term prospects for the economy - but through a political lens. As I see our economic woes (as they exist right now we have a stagnant economy - if the Eurozone collapses, we'll have a whole other set of problems), we need much more action to really get a recovery going. We need either (or both) a big stimulus or more aggressive monetary efforts including allowing changing inflation expectations until unemployment decreases.
But given our political situation, neither of those options seems likely. President Obama is not going to get much if any stimulus. And the fed is stuck doing things that would have seemed wildly aggressive five years ago but are now far too feeble with little indication that it will get bold (truth be told, the fed is still acting like it has one mandate - inflation - when it in fact has two - inflation and employment).
Worse still, with a dragging economy, Obama is unlikely in my book to be reelected (nor do I think he particularly deserves it - he decided, or at least acquiesced, to focus on balancing the budget while unemployment was still above 9 percent). And with a conservative president, we are even less likely to get any stimulus. Maybe we could get a tax cut, though with Republicans pretending to be fiscally responsible, we might not even get that. We haven't so far, as Republicans are happy to let the economy suffer if it means better electoral prospects and denying Obama any victories.
So this should mean that the economy will be stuck for the next five years (ie lost decade). What has got me thinking however is the possibility that the economy does start to really recover sometime in 2013 or 2014 even absent any intervention by then-President Romney or the federal reserve. If that happens, what does that say about liberal prognostications on the economy?
It would at least allow Republicans to say that the best medicine was to do nothing. But is that what it really means? Or does it mean that the economy will / would have eventually recover(ed) and that Republican obstructions slowed the recovery? I would assume the later, but it is difficult to prove. And it certainly decreases the urgency of liberal action. In other words, if the recovery will happen in five years without help, is it worth it / necessary to do something in year two - especially if some effects (construction programs) might take a year or two to show an effect?
Clearly I don't have any answers right now - especially since the question is hypothetical and based on Obama losing and Romney doing nothing (short of rolling back some regulations). But it is something I want to be prepared to think about.
But given our political situation, neither of those options seems likely. President Obama is not going to get much if any stimulus. And the fed is stuck doing things that would have seemed wildly aggressive five years ago but are now far too feeble with little indication that it will get bold (truth be told, the fed is still acting like it has one mandate - inflation - when it in fact has two - inflation and employment).
Worse still, with a dragging economy, Obama is unlikely in my book to be reelected (nor do I think he particularly deserves it - he decided, or at least acquiesced, to focus on balancing the budget while unemployment was still above 9 percent). And with a conservative president, we are even less likely to get any stimulus. Maybe we could get a tax cut, though with Republicans pretending to be fiscally responsible, we might not even get that. We haven't so far, as Republicans are happy to let the economy suffer if it means better electoral prospects and denying Obama any victories.
So this should mean that the economy will be stuck for the next five years (ie lost decade). What has got me thinking however is the possibility that the economy does start to really recover sometime in 2013 or 2014 even absent any intervention by then-President Romney or the federal reserve. If that happens, what does that say about liberal prognostications on the economy?
It would at least allow Republicans to say that the best medicine was to do nothing. But is that what it really means? Or does it mean that the economy will / would have eventually recover(ed) and that Republican obstructions slowed the recovery? I would assume the later, but it is difficult to prove. And it certainly decreases the urgency of liberal action. In other words, if the recovery will happen in five years without help, is it worth it / necessary to do something in year two - especially if some effects (construction programs) might take a year or two to show an effect?
Clearly I don't have any answers right now - especially since the question is hypothetical and based on Obama losing and Romney doing nothing (short of rolling back some regulations). But it is something I want to be prepared to think about.
Gingrich v. Romney
Dear Conservative,
I see that in the latest, and probably last, iteration of the your anyone-but-Romney fickleness, Newt Gingrich has surged in the polls. In the past, I have avoided writing on the newest surge because I assumed the person would crash. There are a lot of reasons why Gingrich might (money, staff, erratic behavior, skeletons), but the right is desperate, and he might actually stick around.
Since I think I am pretty good at thinking like a conservative, I am going to talk through with you the decision you might face: Romney versus Gingrich.
First, I want to acknowledge that you face a difficult task. Between the two, there is only one similarity I can think of: Both candidates have a history of supporting positions that are now unsupportable - namely carbon cap and trade and health care individual mandate.
Other than that, the candidates are pretty different. Romney is perceived as a moderate that has flipped to win the primary - which makes him untrustworthy. However, he is also seen as competent and probably a good manager; his business successes and time as governor support that perception. And though he seems slippery, maybe robotic, he doesn't have any baggage around family issues that Gingrich has.
Gingrich has conservative credentials. So his flipping is perceived as erratic - or better, excused because others in the party have flipped (ie Heritage Foundation). He is seen as an ideas man, though maybe too wildly seeking new ideas and not grounded enough to manage an administration well. And though he is smart, some of his ideas and theories are not well thought-out. Also, his history with his wives shows a major lack of compassion, loyalty and moral decency - and his timing with the impeachment reeks of hypocrisy (though you probably don't care about that - better to go after a liberal like Clinton hypocritically than to be consistent and therefore not impeach a Democratic president).
Finally, and perhaps the worst unless he can continue to disingenuously sweet talk his way out of it, is his lobbying. I don't think people will continue to buy that Gingrich was only providing history lessons for millions of dollars. And, if you are getting paid to support an idea, even if you would like the idea anyway, it is still lobbying.
In looking at the two options, I think you, dear conservative, have a difficult choice. A robotic but competent former governor whose core positions and values seem open for change with the winds or an erratic but full of ideas former legislator and lobbyist who lacks compassion and loyalty. I would probably go with the one more likely to be a good manager. But then again, maybe having loyalty to conservative principles is more important. And despite his erraticness sometimes, Gingrich is better on that front.
I see that in the latest, and probably last, iteration of the your anyone-but-Romney fickleness, Newt Gingrich has surged in the polls. In the past, I have avoided writing on the newest surge because I assumed the person would crash. There are a lot of reasons why Gingrich might (money, staff, erratic behavior, skeletons), but the right is desperate, and he might actually stick around.
Since I think I am pretty good at thinking like a conservative, I am going to talk through with you the decision you might face: Romney versus Gingrich.
First, I want to acknowledge that you face a difficult task. Between the two, there is only one similarity I can think of: Both candidates have a history of supporting positions that are now unsupportable - namely carbon cap and trade and health care individual mandate.
Other than that, the candidates are pretty different. Romney is perceived as a moderate that has flipped to win the primary - which makes him untrustworthy. However, he is also seen as competent and probably a good manager; his business successes and time as governor support that perception. And though he seems slippery, maybe robotic, he doesn't have any baggage around family issues that Gingrich has.
Gingrich has conservative credentials. So his flipping is perceived as erratic - or better, excused because others in the party have flipped (ie Heritage Foundation). He is seen as an ideas man, though maybe too wildly seeking new ideas and not grounded enough to manage an administration well. And though he is smart, some of his ideas and theories are not well thought-out. Also, his history with his wives shows a major lack of compassion, loyalty and moral decency - and his timing with the impeachment reeks of hypocrisy (though you probably don't care about that - better to go after a liberal like Clinton hypocritically than to be consistent and therefore not impeach a Democratic president).
Finally, and perhaps the worst unless he can continue to disingenuously sweet talk his way out of it, is his lobbying. I don't think people will continue to buy that Gingrich was only providing history lessons for millions of dollars. And, if you are getting paid to support an idea, even if you would like the idea anyway, it is still lobbying.
In looking at the two options, I think you, dear conservative, have a difficult choice. A robotic but competent former governor whose core positions and values seem open for change with the winds or an erratic but full of ideas former legislator and lobbyist who lacks compassion and loyalty. I would probably go with the one more likely to be a good manager. But then again, maybe having loyalty to conservative principles is more important. And despite his erraticness sometimes, Gingrich is better on that front.
Saturday, November 19, 2011
My Predicament
In November of 2012, I will face a difficult decision. I will need to vote for a candidate for president. Here is where the predicament is. Ideologically, I will be more closely aligned with the Democrat - Barack Obama. However, I don't think President Obama has been very effective, especially on the policy that is and has been most urgent: the economy and jobs.
In fact, I think our president hasn't even been good at articulating what needs to happen to improve the economy. He passed a stimulus that he knew at the time was too small but pretended it was big enough. And then he changed the conversation to budget deficits (going along with Republicans) way too soon when job growth was non-existent. And now he is pushing for a jobs plan that is decent, but has no chance of passing.
Having said all that, his Republican challenger, whoever that may be (but hopefully Romney), will have much worse ideas. The GOP candidate will probably talk about decreasing regulation and cutting taxes for the rich - two solutions to a problem that doesn't exist.
So what am I to do? Clearly, I will vote Democrat and so vote for Obama. His policies are at least better than his opponents will be. Unfortunately though this means returning someone to a job he probably doesn't deserve. But when your choice for a job is between only two candidates, you have to choose the better of the two - the perfect doesn't exist.
Having said all that, my decision still isn't complete. In 2008, I volunteered a good amount of my time for candidate Obama's campaign. I know many other people did this as well. I have decided now that I won't do that this time around. I volunteered because I believed in Obama. I believed in his message - of moving past the baby boomers' arguments and divisiveness; of accomplishing real change.
I realize now that I was naive to do that. And while, part of the fault lies with me, part of the fault also lies with him. You see, debates are necessary. Sometimes being disagreeable is necessary. But more than that, change comes through leadership and strength. And I haven't seen that in our president. He seems to lead from behind.
So I won't volunteer. And I know many others feel the same way. Which might doom President Obama's campaign. That is too bad. But if you campaign on change, you need to achieve it. Or at least look like you are really fighting for it.
In fact, I think our president hasn't even been good at articulating what needs to happen to improve the economy. He passed a stimulus that he knew at the time was too small but pretended it was big enough. And then he changed the conversation to budget deficits (going along with Republicans) way too soon when job growth was non-existent. And now he is pushing for a jobs plan that is decent, but has no chance of passing.
Having said all that, his Republican challenger, whoever that may be (but hopefully Romney), will have much worse ideas. The GOP candidate will probably talk about decreasing regulation and cutting taxes for the rich - two solutions to a problem that doesn't exist.
So what am I to do? Clearly, I will vote Democrat and so vote for Obama. His policies are at least better than his opponents will be. Unfortunately though this means returning someone to a job he probably doesn't deserve. But when your choice for a job is between only two candidates, you have to choose the better of the two - the perfect doesn't exist.
Having said all that, my decision still isn't complete. In 2008, I volunteered a good amount of my time for candidate Obama's campaign. I know many other people did this as well. I have decided now that I won't do that this time around. I volunteered because I believed in Obama. I believed in his message - of moving past the baby boomers' arguments and divisiveness; of accomplishing real change.
I realize now that I was naive to do that. And while, part of the fault lies with me, part of the fault also lies with him. You see, debates are necessary. Sometimes being disagreeable is necessary. But more than that, change comes through leadership and strength. And I haven't seen that in our president. He seems to lead from behind.
So I won't volunteer. And I know many others feel the same way. Which might doom President Obama's campaign. That is too bad. But if you campaign on change, you need to achieve it. Or at least look like you are really fighting for it.
Wednesday, October 26, 2011
Volker Rule Brief Analysis
I completely agree with this WSJ Op-Ed on the Volker Rule.
While some blame goes to Republicans and moderate Democrats for blocking a strong Volker Rule, I think the lions share of the blame goes to Democrats in Congress. They were unable to create an easy bright line rule. As if trying to conform to stereotypes, they created excessively long and confusing legislation. But also legislation that punts to the admin and forces them to create longer and more confusing rules.
This isn't good policy. And it doesn't make Democrats look good.
Reasonable people have seen enough to say that Washington is incapable of drawing bright lines and applying clear rules fairly across all securities markets. The result is all but certain to be a final rule that different people will interpret different ways, leading to loopholes for traders and arbitrary enforcement.
Under this Beltway rendering of Volcker, trading will continue but with a much higher bureaucratic cost and with the illusion of safety that only regulation can create. Until the government is willing to create a durable financial system that allows failure, the best policy response is to make the rules so simple that even Washington can enforce them. That means higher, even very high, bank capital standards and margin requirements on risky trades between banks. Those aren't panaceas, but they offer more hope for taxpayers than the bureaucratic and bank-lobbyist jump ball that is now the Volcker Rule.I am frustrated with what I am learning about the financial reform legislation (Dodd-Frank). In the interest of compromise (or should I say giving special interests what they want), Volker was watered down and punted to the admin. What we have is weak, confusing, and worst of all has the illusion of safety.
While some blame goes to Republicans and moderate Democrats for blocking a strong Volker Rule, I think the lions share of the blame goes to Democrats in Congress. They were unable to create an easy bright line rule. As if trying to conform to stereotypes, they created excessively long and confusing legislation. But also legislation that punts to the admin and forces them to create longer and more confusing rules.
This isn't good policy. And it doesn't make Democrats look good.
Saturday, October 22, 2011
Too Big to Fail
Moderate GOP candidate Jon Huntsman had brief attention recently for suggesting Dodd-Frank did not end Too Big to Fail and for proposing some solutions. After reading Matthew Yglesias, I have to agree that Huntsman doesn't propose anything serious to deal with this problem.
I don't completely disagree with Huntsman's analysis that Dodd-Frank financial reform bill did not end Too Big to Fail. While it provides for a way to wind down big banks if they face trouble, the government might still feel the need to provide a bail out instead (or in addition?).
Huntsman seems to call for a repeal of Dodd-Frank, then that a provision similar or the same as Dodd-Frank's wind-down be enacted. He also calls for a tax on these large institutions (which I think Republicans opposed). None of this seems new or too strong.
If we want to end Too Big to Fail, we need to actually break up big banks. Otherwise, I think we are doing all we can.
I don't completely disagree with Huntsman's analysis that Dodd-Frank financial reform bill did not end Too Big to Fail. While it provides for a way to wind down big banks if they face trouble, the government might still feel the need to provide a bail out instead (or in addition?).
Huntsman seems to call for a repeal of Dodd-Frank, then that a provision similar or the same as Dodd-Frank's wind-down be enacted. He also calls for a tax on these large institutions (which I think Republicans opposed). None of this seems new or too strong.
If we want to end Too Big to Fail, we need to actually break up big banks. Otherwise, I think we are doing all we can.
My Move Left
For those of you that are long time followers of my blog (anyone?) or people close to me, you might be thinking that I seem to have moved left over the years*. One or two people have said this outright, and so I have given it some thought.
Ultimately, my conclusion is that I was more moderate during the Iraq War, mostly because I found that Democrats had no viable solution except to attack the war and attack Bush. I thought we had to stay in Iraq (you break it, you own it). So I wanted to support people that understood that and had good proposals. Along those lines, I liked people like McCain, Powell, Biden (though his solution was crazy).
But I don’t think my domestic policies have changed any. And now that domestic policy dominates, I think it appears that I have moved left, when in reality, the issues changed to things on which I am more liberal.
To be honest though, I cannot say for sure that I haven't moved left on foreign policy. I still think I was right to defend staying in Iraq. And I think I always supported the surge. But I do have a vague feeling that I was a bit more hawkish, at least at in 2004. Thoughts?
*There was a time when I had said that I would support John McCain for president. This was long before his 2008 campaign though, when he turned far to the right to appease his base.
Ultimately, my conclusion is that I was more moderate during the Iraq War, mostly because I found that Democrats had no viable solution except to attack the war and attack Bush. I thought we had to stay in Iraq (you break it, you own it). So I wanted to support people that understood that and had good proposals. Along those lines, I liked people like McCain, Powell, Biden (though his solution was crazy).
But I don’t think my domestic policies have changed any. And now that domestic policy dominates, I think it appears that I have moved left, when in reality, the issues changed to things on which I am more liberal.
To be honest though, I cannot say for sure that I haven't moved left on foreign policy. I still think I was right to defend staying in Iraq. And I think I always supported the surge. But I do have a vague feeling that I was a bit more hawkish, at least at in 2004. Thoughts?
*There was a time when I had said that I would support John McCain for president. This was long before his 2008 campaign though, when he turned far to the right to appease his base.
The Reason for Taxes
Democrats are often accused of favoring redistribution of wealth. I think that is inaccurate. Some liberals may feel this way, but I think most do not. And I especially do not feel this way. Instead, I believe in having energetic government that protects rights (courts, regulatory oversight), provides for growth (education, research, and infrastructure) and helps those at the bottom (by providing social safety net, food and housing) and helps them move up (education, job training).
In order to achieve this, we need to raise revenues. If we agree that we need these programs, and I think a majority of Americans do agree, than we need to pay for it. And to do so, the burden should fall on everyone, but the rich should pay more. This is why we do, and should, have a progressive income tax structure. It isn’t to punish the rich. It is to pay for necessary programs.
Furthermore, talking about who should pay for the services we need, and pointing out that the rich keep trying to get tax cuts at the expense of the poor is not class warfare. Implementing policies that actually do increase the burdens on the middle and lower classes so the rich can pay less is class warfare.
In order to achieve this, we need to raise revenues. If we agree that we need these programs, and I think a majority of Americans do agree, than we need to pay for it. And to do so, the burden should fall on everyone, but the rich should pay more. This is why we do, and should, have a progressive income tax structure. It isn’t to punish the rich. It is to pay for necessary programs.
Furthermore, talking about who should pay for the services we need, and pointing out that the rich keep trying to get tax cuts at the expense of the poor is not class warfare. Implementing policies that actually do increase the burdens on the middle and lower classes so the rich can pay less is class warfare.
A Mistake
I agree with this series at Foreign Policy - the Nobel Peace Prize given to President Barack Obama was a mistake. Here is the relevant quote:
Obama also surprised many by devoting much of his Nobel lecture to a defense of the legitimate use of force.
Indeed, the Nobel seems to have been given to candidate Obama -- the one defined by his opposition to the war in Iraq, promise to close Guantánamo, and pledge to foster dialogue with hostile governments -- rather than President Obama, better known for the Afghan surge, a massively expanded drone war, military intervention in Libya, and the extrajudicial killings of Anwar al-Awlaki and Osama bin Laden. Not to mention that Gitmo's still open and there's been little progress made on Middle East peace.
These actions may all be justifiable, but they're likely not what the committee had in mind.
Flat Tax v. Simple Tax
There has been a log of talk lately about the need to simplify the tax code. Let's start by assuming that is true (at the end of this post, I'll briefly address whether it is true). Right now, we have a tax code that is both progressive - meaning tax rates change as income changes - and has a lot of exemptions and deductions.
What makes the tax code complicated are the exemptions and deductions, which are numerous and the wealthy can use to decrease their tax liability. The progressive nature of the code is not what is complicated. In fact, without exemptions, figuring out your tax liability would be simple. You pay a certain percentage on your income below a certain amount, and a higher percentage on income above that amount.
What we are seeing from Republican candidates are proposals for flat taxes, which eliminate deductions and the progressive tax code. They are trying to make it sound like a flat tax is necessary to simplify the code while hiding that what will really happen is a tax cut for the wealthy. They are also adding back in some exemptions (Herman Cain's 999), which seems to be the worst of both worlds - a regressive tax that remains complicated.
Before I end, I do want to address whether the complication is necessary. The exemptions and deductions are used to incentivize certain behaviors. We can argue the merits of each exemption, but in general, we should decide whether we want a simple code and forgo providing incentives for things like homeownership, donations to charity, and affordable housing to name a few.
I don't have a strong opinion at the moment. I would rather affordable housing be provided through direct spending rather than tax spending. However, I realize tax spending is easier to implement than direct spending - contrary to rational economics models, there appears to be a psychological difference between the two. And I think charity spending is often to museums and private colleges, which may not be the most deserving or urgent needs. But I could be convinced that we need the incentives if there are better examples.
What makes the tax code complicated are the exemptions and deductions, which are numerous and the wealthy can use to decrease their tax liability. The progressive nature of the code is not what is complicated. In fact, without exemptions, figuring out your tax liability would be simple. You pay a certain percentage on your income below a certain amount, and a higher percentage on income above that amount.
What we are seeing from Republican candidates are proposals for flat taxes, which eliminate deductions and the progressive tax code. They are trying to make it sound like a flat tax is necessary to simplify the code while hiding that what will really happen is a tax cut for the wealthy. They are also adding back in some exemptions (Herman Cain's 999), which seems to be the worst of both worlds - a regressive tax that remains complicated.
Before I end, I do want to address whether the complication is necessary. The exemptions and deductions are used to incentivize certain behaviors. We can argue the merits of each exemption, but in general, we should decide whether we want a simple code and forgo providing incentives for things like homeownership, donations to charity, and affordable housing to name a few.
I don't have a strong opinion at the moment. I would rather affordable housing be provided through direct spending rather than tax spending. However, I realize tax spending is easier to implement than direct spending - contrary to rational economics models, there appears to be a psychological difference between the two. And I think charity spending is often to museums and private colleges, which may not be the most deserving or urgent needs. But I could be convinced that we need the incentives if there are better examples.
Wednesday, October 19, 2011
Who are the 99 Percent?
The recent Occupy Wall Street protests have been referencing the 99 percent versus the 1 percent - ie the percentiles of income distribution in the US. But I think it is important that we all see what the different income levels are at the different percentiles.
Income percentiles (from Tax Policy Center)
25%: $19,375
50%: $42,327
75%: $85,811
90%: $154,131
99%: $506,533
There is more nuance available if you want it. Numbers are different based on location (median income in NYC is $50,173) and tax filing status (median income for married filing jointly is $74,608). But this should give a general sense.
I won’t say where I am on this chart, but I will say that I don’t feel as high up as I am, which is apparently a pretty common phenomenon. I think I, and others, feel this way because purchasing power among much of the chart is relatively similar. I am still facing things I cannot afford that seem like basics. In other words, I would expect that someone at my position in the percentiles would have much more disposable income than I do. But overall, I am pretty comfortable, so I am not complaining.
Anyway, now when people talk about the 99 percent, we know who that is. And we know who the 99th percentile are.
Income percentiles (from Tax Policy Center)
25%: $19,375
50%: $42,327
75%: $85,811
90%: $154,131
99%: $506,533
There is more nuance available if you want it. Numbers are different based on location (median income in NYC is $50,173) and tax filing status (median income for married filing jointly is $74,608). But this should give a general sense.
I won’t say where I am on this chart, but I will say that I don’t feel as high up as I am, which is apparently a pretty common phenomenon. I think I, and others, feel this way because purchasing power among much of the chart is relatively similar. I am still facing things I cannot afford that seem like basics. In other words, I would expect that someone at my position in the percentiles would have much more disposable income than I do. But overall, I am pretty comfortable, so I am not complaining.
Anyway, now when people talk about the 99 percent, we know who that is. And we know who the 99th percentile are.
Friday, October 07, 2011
About the Occupation (of Wall Street)
The protests on and near Wall Street continue and are starting to get regular coverage. I work a few blocks away and so have witnessed them in their element at Liberty Square Park as well as marching and speaking outside my building near City Hall.
My initial thoughts about the protests were that they were kind of silly. They seemed to lack a purpose and goal. Why protest Wall Street? Even at its most successful, would a protest convince Wall Street to be less profit-driven? If you want to affect Wall Street, you need to change laws.
But I am starting to feel differently. While I still think it is more than a little nebulous, I think it might serve a really good purpose. This could finally be the response to the Tea Party - which is itself nebulous and a little silly. I think we need a strong and vocal liberal wing of the party that can actually push our moderate leaders to move away from center-right policies and embrace at the very least center-left.
I had been thinking that there would eventually be a left-wing movement again (I think I first heard Peggy Noonan raise the possibility). But my prediction, which I hadn't voiced yet, was that it would come after the 2012 elections. I figured we would probably get a Republican president, almost definitely get a Republican senate, and might keep a Republican House. If that happened, the Republicans would definitely overreach and try to ax popular government programs. And this would prompt the liberal awakening. Independents would also revolt because they would finally realize that smaller government means less services and cuts to programs they actually like.
If all of this can start before the 2012 elections and avoid a Republican government, that would be great. So I really do hope this movement, which had humble beginnings, can create a space where liberal / progressive values are once again championed - and loudly. And remember, we don't have to agree with everything in the movement, but we do need it to be counterbalance to the crazies on the right that are at the moment driving policy.
My initial thoughts about the protests were that they were kind of silly. They seemed to lack a purpose and goal. Why protest Wall Street? Even at its most successful, would a protest convince Wall Street to be less profit-driven? If you want to affect Wall Street, you need to change laws.
But I am starting to feel differently. While I still think it is more than a little nebulous, I think it might serve a really good purpose. This could finally be the response to the Tea Party - which is itself nebulous and a little silly. I think we need a strong and vocal liberal wing of the party that can actually push our moderate leaders to move away from center-right policies and embrace at the very least center-left.
I had been thinking that there would eventually be a left-wing movement again (I think I first heard Peggy Noonan raise the possibility). But my prediction, which I hadn't voiced yet, was that it would come after the 2012 elections. I figured we would probably get a Republican president, almost definitely get a Republican senate, and might keep a Republican House. If that happened, the Republicans would definitely overreach and try to ax popular government programs. And this would prompt the liberal awakening. Independents would also revolt because they would finally realize that smaller government means less services and cuts to programs they actually like.
If all of this can start before the 2012 elections and avoid a Republican government, that would be great. So I really do hope this movement, which had humble beginnings, can create a space where liberal / progressive values are once again championed - and loudly. And remember, we don't have to agree with everything in the movement, but we do need it to be counterbalance to the crazies on the right that are at the moment driving policy.
Goodbye to a Friend
A few weeks ago I went to a celebration of the life of a friend. I went to graduate school with her and she died recently from an aggressive form of cancer. There are a lot of reasons why this has affected me, but I want to focus on one part in particular for this blog.
My friend was a government superstar. We had both received Master's Degrees from the Maxwell School of Citizenship and Public Affairs at Syracuse University. It is one of the best schools in the country for public administration, and at one of the best schools, she has been one of the most successful. Her obituary in the Washington Post talks briefly about her work on human rights at the State Department. And at the celebration of her life, her coworkers talked about all of her amazing accomplishments. (She seemingly had my dream job - though for me it is just a dream and not something I actually work towards nor am even near qualified for. For her it was a dream job and she lived it and was amazing at it.)
What I take away from this is that while she died young and leaves behind a loving husband and young daughter, she can take solace in the life she lived and what she accomplished; she has done so much for human rights around the world.
At Maxwell, we were taught the Athenian Oath, which ends as follows:
You might guess that there is political commentary coming. And you are right. I want to be able to say the same thing when I leave. And that is what I don't understand about conservatism. At it's base, it is about smaller government - less taxes and less services. Most often this means less services for those in need. And whether intentional or not, it often means under-producing other beneficial public goods like education and infrastructure.
The point is that I just can't imagine being satisfied with a life that is spent not improving the world, not trying to make things better, and not trying to help people. Without that, what is your legacy? We are only here for a brief time, and so we should be making sure we are improving the world while we are here. And that is why I am a Democrat.
I can only hope to come close to the example my friend left for us.
My friend was a government superstar. We had both received Master's Degrees from the Maxwell School of Citizenship and Public Affairs at Syracuse University. It is one of the best schools in the country for public administration, and at one of the best schools, she has been one of the most successful. Her obituary in the Washington Post talks briefly about her work on human rights at the State Department. And at the celebration of her life, her coworkers talked about all of her amazing accomplishments. (She seemingly had my dream job - though for me it is just a dream and not something I actually work towards nor am even near qualified for. For her it was a dream job and she lived it and was amazing at it.)
What I take away from this is that while she died young and leaves behind a loving husband and young daughter, she can take solace in the life she lived and what she accomplished; she has done so much for human rights around the world.
At Maxwell, we were taught the Athenian Oath, which ends as follows:
We will transmit this city not only not less, but greater, better and more beautiful than it was transmitted to us.This means, at its most simple, to make sure that when we leave, that we have improved the world around us. My friend did this. And she did so much so soon, that even at the young age of 34 she can say she delivered the city much, much greater.
You might guess that there is political commentary coming. And you are right. I want to be able to say the same thing when I leave. And that is what I don't understand about conservatism. At it's base, it is about smaller government - less taxes and less services. Most often this means less services for those in need. And whether intentional or not, it often means under-producing other beneficial public goods like education and infrastructure.
The point is that I just can't imagine being satisfied with a life that is spent not improving the world, not trying to make things better, and not trying to help people. Without that, what is your legacy? We are only here for a brief time, and so we should be making sure we are improving the world while we are here. And that is why I am a Democrat.
I can only hope to come close to the example my friend left for us.
Friday, September 09, 2011
Why Not Monetary Policy
I wonder if we (liberals) made a bad decision not to focus more on monetary policy solutions to our unemployment problems. I have taken a lot of my cues from Paul Krugman, and while he acknowledged that there were things the fed could do, he seemed to calling more strongly for fiscal stimulus.
There was a speech by the head of the Chicago Federal Reserve calling for greater fed action. His logic is simple and clear: the fed has a dual mandate - to maintain optimal levels of inflation and unemployment. We can say that the optimal levels are probably 2 percent for inflation and 6 percent for unemployment (a conservative estimate for full employment).
With unemployment 3 points higher than optimal, the fed should be doing way more. In fact, it should be willing to accept 3 percent inflation if it means bringing unemployment down to say 7 percent. And the Fed signaling their willingness to tolerate higher inflation is one of the non-standard tools Krugman said was possible to help bring down unemployment.
I - and many liberal economics commentators - love the speech. But I really think we should have been pushing for this much harder already. Fiscal stimulus was a non-starter. Obama couldn't achieve it. I believe he should have called for it and made Republicans look bad. But he couldn't get it. But he could have gotten more action from the Fed.
And he could have turned it into a great argument with Republicans. Imagine them fighting against monetary policy - so extreme they oppose Milton Freedman. And we could have had a debate about which is more important, inflation or unemployment? Republicans favor bankers, Democrats favor the unemployed.
In this case, all he had to do was convince the Fed that he was right - not ideologically extreme Republicans. And I think he could have won the debate as well.
But it's not too late (though Obama didn't mention it in his jobs speech). We need to push this front. Obama's jobs initiatives will be helpful (depending on how much is passed). But this could do a lot and sooner. And with less budget implications.
There was a speech by the head of the Chicago Federal Reserve calling for greater fed action. His logic is simple and clear: the fed has a dual mandate - to maintain optimal levels of inflation and unemployment. We can say that the optimal levels are probably 2 percent for inflation and 6 percent for unemployment (a conservative estimate for full employment).
With unemployment 3 points higher than optimal, the fed should be doing way more. In fact, it should be willing to accept 3 percent inflation if it means bringing unemployment down to say 7 percent. And the Fed signaling their willingness to tolerate higher inflation is one of the non-standard tools Krugman said was possible to help bring down unemployment.
I - and many liberal economics commentators - love the speech. But I really think we should have been pushing for this much harder already. Fiscal stimulus was a non-starter. Obama couldn't achieve it. I believe he should have called for it and made Republicans look bad. But he couldn't get it. But he could have gotten more action from the Fed.
And he could have turned it into a great argument with Republicans. Imagine them fighting against monetary policy - so extreme they oppose Milton Freedman. And we could have had a debate about which is more important, inflation or unemployment? Republicans favor bankers, Democrats favor the unemployed.
In this case, all he had to do was convince the Fed that he was right - not ideologically extreme Republicans. And I think he could have won the debate as well.
But it's not too late (though Obama didn't mention it in his jobs speech). We need to push this front. Obama's jobs initiatives will be helpful (depending on how much is passed). But this could do a lot and sooner. And with less budget implications.
Failed Stimulus
I don't think this analysis of the stimulus is too off-base. Basically, the stimulus was poorly targeted. That is what happens when Congress gets to pass a stimulus. They see it as an opportunity to fund things they like, not necessarily things that will do the most for the economy.
I get that. I do. But I still think that a less-effective stimulus is better than no stimulus at all. It helped, but was too small and poorly targeted. And that is one reason we are where we are.
On a side note, I think they are unfair to Krugman. If I am not mistaken, I think he acknowledged that the stimulus was poorly targeted.
I get that. I do. But I still think that a less-effective stimulus is better than no stimulus at all. It helped, but was too small and poorly targeted. And that is one reason we are where we are.
On a side note, I think they are unfair to Krugman. If I am not mistaken, I think he acknowledged that the stimulus was poorly targeted.
Clean Air - Later
Last week, Obama announced he wouldn't allow the EPA to change the clean air regulations to toughen the ground level ozone standards. At some level, I get it. During a recession - or in this case a very weak recovery - government is reluctant to increase the costs on companies. Even in a situation when it seems companies don't lack money, they lack sales and any reason to hire and expand (ie demand is depressed).
But the way Obama did it seemed poor political strategy. What he should have said was, "Considering the state of our economy, I am being risk averse. I don't want to do anything that might add costs. But I want to be clear, we are not facing 9 percent unemployment because of regulations. And changing regulations won't get us out of the recession."
He should have used it as an opportunity to pick a fight with Republicans. Instead, once again he changed a policy and adopted Republican talking points. It made him look weak and unprincipled. And it made it look like Republicans are right about regulations.
But the way Obama did it seemed poor political strategy. What he should have said was, "Considering the state of our economy, I am being risk averse. I don't want to do anything that might add costs. But I want to be clear, we are not facing 9 percent unemployment because of regulations. And changing regulations won't get us out of the recession."
He should have used it as an opportunity to pick a fight with Republicans. Instead, once again he changed a policy and adopted Republican talking points. It made him look weak and unprincipled. And it made it look like Republicans are right about regulations.
Intelligence in Politics
I am sure I have written about this in the past, I want to add some new thoughts. With Michelle Bachman and Rick Perry in the running for the Republican presidential nomination, there is talk again about whether those two are smart enough to be president. Republicans often bristle at this and I think often misunderstand what is meant.
First, let me say that I agree that a president needs to be smart as a minimum qualification. But that isn't at all based on education. And the best way to illustrate this is to look at some examples. George W. Bush was educated at private high school and ivy league undergrad and business school (Exeter, Yale, and Harvard, respectively). But I would not consider him smart and often felt that he wasn't up to the job intelligence-wise.
Compare that to someone like Karl Rove, whom I do not like at all, but I would consider pretty smart. But Rove does not have a college degree. As you can see, that doesn't matter to me in terms of assessing his intelligence.
Much was made of Sarah Palin's peripatetic college history. Someone with her history could still be very smart. However it was used as another piece of evidence of her lack of intelligence - something people could tell based on how she answered questions.
The point is that many Republicans are very smart: John McCain (last in his class at Naval Academy but I don't hold that against him), John Boehner, New Gingrich (though he is accused of having an undisciplined mind), Mitt Romney, Mike Huckabee, John Huntsman, Tim Pawlenty, Bobby Jindal, Mitch McConnell. The problem many liberals have is with the few that squeak by that don't seem to be very smart. George W. Bush, Rick Perry (maybe less so), Michelle Bachmann, and Sarah Palin are the ones that come to mind that I would consider not up to the task.
To be clear, intelligence should be necessary, but not sufficient. John Kerry went to Harvard and is very smart. But I would say he might not have made the best president. And as smart as Obama is, he is not doing as well as many had hoped.
One last thing: I am realizing how Sarah Palin has set the bar lower in terms of intelligence. With her at one point considered a very strong contender for the nomination had she entered, I think we witnessed a new low (even Ann Coulter seems to admit that Palin isn't smart enough). And since she hasn't run, I feel so relived and am now more inclined to view Bachmann, Perry, and even Bush as smart enough since they are smarter than Palin. I don't think that is a good thing.
First, let me say that I agree that a president needs to be smart as a minimum qualification. But that isn't at all based on education. And the best way to illustrate this is to look at some examples. George W. Bush was educated at private high school and ivy league undergrad and business school (Exeter, Yale, and Harvard, respectively). But I would not consider him smart and often felt that he wasn't up to the job intelligence-wise.
Compare that to someone like Karl Rove, whom I do not like at all, but I would consider pretty smart. But Rove does not have a college degree. As you can see, that doesn't matter to me in terms of assessing his intelligence.
Much was made of Sarah Palin's peripatetic college history. Someone with her history could still be very smart. However it was used as another piece of evidence of her lack of intelligence - something people could tell based on how she answered questions.
The point is that many Republicans are very smart: John McCain (last in his class at Naval Academy but I don't hold that against him), John Boehner, New Gingrich (though he is accused of having an undisciplined mind), Mitt Romney, Mike Huckabee, John Huntsman, Tim Pawlenty, Bobby Jindal, Mitch McConnell. The problem many liberals have is with the few that squeak by that don't seem to be very smart. George W. Bush, Rick Perry (maybe less so), Michelle Bachmann, and Sarah Palin are the ones that come to mind that I would consider not up to the task.
To be clear, intelligence should be necessary, but not sufficient. John Kerry went to Harvard and is very smart. But I would say he might not have made the best president. And as smart as Obama is, he is not doing as well as many had hoped.
One last thing: I am realizing how Sarah Palin has set the bar lower in terms of intelligence. With her at one point considered a very strong contender for the nomination had she entered, I think we witnessed a new low (even Ann Coulter seems to admit that Palin isn't smart enough). And since she hasn't run, I feel so relived and am now more inclined to view Bachmann, Perry, and even Bush as smart enough since they are smarter than Palin. I don't think that is a good thing.
On Compromise and Obama
This is the second of two related pieces on Obama. The first talked about Obama's decision to be a moderate. This one will talk about Obama's belief in compromise above all else.
First, let me state clearly that I don't mind compromise. In fact, I think it is often necessary for anything to happen and for us as a society to progress.
It seems that the president has decided that voters want compromise. But he thinks that he has to start out by showing how willing he is to compromise. In other words, if he says the word compromise early enough and often enough, voters will see that he is the reasonable one and the Republicans the crazy ones.
But I don't think voters care when you say compromise, as long as you do compromise. In fact, in every situation, Obama has shown signs of good faith and not been rewarded by voters or his adversaries in the Republican party. He put forward a stimulus with significant tax cuts instead of making them demand it (and received 3 Republican votes for his troubles). He put forward a health care bill modeled on Romney's plan in Massachusetts instead of something more liberal (and received not votes). And his positioning on the debt limit has been nothing other than bending over backwards to show his willingness to compromise.
In none of these cases have voters shown signs of approving of his signs of good faith. And it certainly hasn't helped his negotiating position.
What he should do is start from a position of strength, and let the deal in the end be the sign of his willingness to compromise. And this would benefit liberal positions as well because he could spend time defending liberal ideals and then reach a compromise that has more of what he wants.
The bottom line is this: I and most voters want leaders to compromise, but we expect them to at least defend their position first.
First, let me state clearly that I don't mind compromise. In fact, I think it is often necessary for anything to happen and for us as a society to progress.
It seems that the president has decided that voters want compromise. But he thinks that he has to start out by showing how willing he is to compromise. In other words, if he says the word compromise early enough and often enough, voters will see that he is the reasonable one and the Republicans the crazy ones.
But I don't think voters care when you say compromise, as long as you do compromise. In fact, in every situation, Obama has shown signs of good faith and not been rewarded by voters or his adversaries in the Republican party. He put forward a stimulus with significant tax cuts instead of making them demand it (and received 3 Republican votes for his troubles). He put forward a health care bill modeled on Romney's plan in Massachusetts instead of something more liberal (and received not votes). And his positioning on the debt limit has been nothing other than bending over backwards to show his willingness to compromise.
In none of these cases have voters shown signs of approving of his signs of good faith. And it certainly hasn't helped his negotiating position.
What he should do is start from a position of strength, and let the deal in the end be the sign of his willingness to compromise. And this would benefit liberal positions as well because he could spend time defending liberal ideals and then reach a compromise that has more of what he wants.
The bottom line is this: I and most voters want leaders to compromise, but we expect them to at least defend their position first.
On Moderation and Obama
I respect the idea of moderation and centrism. The answer is sometimes in the middle. And moderates can do good to blunt the edges of the extremes on each side. But if you are going to be a moderate, you need to own it; in other words, it needs to come from core beliefs and not smell of political opportunism.
I can think of two examples of moderates that own it. David Brooks is a good example. He is a moderate conservative. Overall he believes in limited but energetic government. He is sometimes skeptical of government programs and thinks communities are better at solving problems. But he does believe government should do things like spend money on education and infrastructure.
Mitt Romney is another example - at least the Mitt Romney before he developed presidential aspirations. That Mitt Romney wants less taxes on businesses and fewer regulations. But he isn't opposed to new health care programs or social security. And he doesn't disbelieve science like global warming or evolution. That the current Mitt Romney no longer stands by those positions helps prove my point. By going more extreme, people don't believe he is genuine.
President Obama does not own his moderation. His previous positions sometimes show that he doesn't come by it naturally. And other times he shows it by trying to have it both ways.
Let's look at some examples for Obama. On same sex marriage, Obama has staked out an absurd position. He tries to support New York's law allowing same sex marriage, but he does this by nodding to states' rights. He also says that he personally supports civil union but that his position is evolving. So he is staking out a position in the middle - civil unions - but also winking to the left saying he really agrees with them.
As as a senator, Obama was a leading critic of the Bush administration on foreign policy. Yet as president, he has barely changed anything but the most extreme. He has ended the use of torture, but won't close Guantanamo Bay and uses drone attacks with reckless abandon. He even argued for war while receiving the Nobel Peace Prize. And his policy towards Israel has only barely changed compared to Bush. All of this lack of change has left the Muslim world liking him no more than Bush.
And most recently, he has committed to shrinking the budget. He uses language like, "Government needs to live within its means," but also says government needs to take care of its people. It's as if he wants to defend government spending.
Some see this as trying to be all things to all people. I see it as someone that believes in liberal values, but doesn't trust the voters to support him if he stands up for those things. He thinks voters want him to be moderate. But voters can tell when you aren't being yourself.
I can think of two examples of moderates that own it. David Brooks is a good example. He is a moderate conservative. Overall he believes in limited but energetic government. He is sometimes skeptical of government programs and thinks communities are better at solving problems. But he does believe government should do things like spend money on education and infrastructure.
Mitt Romney is another example - at least the Mitt Romney before he developed presidential aspirations. That Mitt Romney wants less taxes on businesses and fewer regulations. But he isn't opposed to new health care programs or social security. And he doesn't disbelieve science like global warming or evolution. That the current Mitt Romney no longer stands by those positions helps prove my point. By going more extreme, people don't believe he is genuine.
President Obama does not own his moderation. His previous positions sometimes show that he doesn't come by it naturally. And other times he shows it by trying to have it both ways.
Let's look at some examples for Obama. On same sex marriage, Obama has staked out an absurd position. He tries to support New York's law allowing same sex marriage, but he does this by nodding to states' rights. He also says that he personally supports civil union but that his position is evolving. So he is staking out a position in the middle - civil unions - but also winking to the left saying he really agrees with them.
As as a senator, Obama was a leading critic of the Bush administration on foreign policy. Yet as president, he has barely changed anything but the most extreme. He has ended the use of torture, but won't close Guantanamo Bay and uses drone attacks with reckless abandon. He even argued for war while receiving the Nobel Peace Prize. And his policy towards Israel has only barely changed compared to Bush. All of this lack of change has left the Muslim world liking him no more than Bush.
And most recently, he has committed to shrinking the budget. He uses language like, "Government needs to live within its means," but also says government needs to take care of its people. It's as if he wants to defend government spending.
Some see this as trying to be all things to all people. I see it as someone that believes in liberal values, but doesn't trust the voters to support him if he stands up for those things. He thinks voters want him to be moderate. But voters can tell when you aren't being yourself.
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