Smart Ain't Enough

One thing about our Democratic friends:  in the day-to-day political trench warfare of sound bites and talking points, they are the champs.  As smart as paint.  That's what Long John Silver told Jim Hawkins in Treasure Island.  "You're a lad, you are," said Silver, "but you're as smart as paint."

But of course, politics is not just smarts, playing the game of sound bite tit-for-tat.  There are bigger issues behind all the combat and the day-to-day one-upmanship.

So it makes complete sense that less than a week after the successful Democratic National Convention--boy, how it helps to have the mainstream media singing in the choir--the whole narrative gets chucked into the toilet when Islamists in Egypt and Libya celebrate 9/11 by trashing US facilities and murdering US diplomats.  It makes No Drama Obama look like No Clue Obama.

I was looking up Antonio Gramsci today.  He's the chap who decided that the bourgeoisie had achieved cultural hegemony by making its ideas part of the "common-sense" culture of the nation.  Why shouldn't the left do the same thing in reverse?

Brilliant idea, Tony.  The only thing is that the bourgeoisie never self-consciously set out to create cultural hegemony.  The bourgeois lived as they lived, and they developed their cultural memes as they went.  They never said: wow, we need to develop cultural hegemony in order to dominate the politics of the western world.

But you, Tony, decided to do just that.  Lefties would set out on a long march through the institutions so they could achieve their own cultural hegemony, and then rule from the solid base of that cultural domination of society.  And, to a great degree, liberals in the US have achieved that cultural hegemony.  Liberals dominate the media, dominate the schools, the university, Hollywood, the foundations.  They hold a remarkable power in the land.

But suppose the American people wake up one day and decide that they hate the world that liberals have built for them?  That is the risk.  Every political dynasty holds power in part due to its cultural hegemony, because it gets to tell its story and others don't.  But eventually, of course, people may decide that the narrative doesn't match up with the reality, that the glorious vision of the future doesn't match the grubby reality of power politics.  Cultural hegemony does not give you a lock on power.  It is just part of the trappings of power, whether the ruling class set out to achieve cultural hegemony or not.

So it is one thing for President Obama to give a high-toned speech about progress towards our goals.  It is another thing if the next day it turns out that the unemployment rate is down because 400,000 people dropped out of the workforce.  It is one thing to talk about getting out of Afghanistan one day and have crazed militants attacking US consulates the next day.  With all the cultural hegemony in the world, "events, dear boy" can quickly make the story and the reality out of joint.

That is where our liberal friends are at in these latter days.  They have been spinning their narrative about all kinds of things: that supply-side economics is trickle-down economics, that the Crash of 2008 was caused by greedy bankers instead of GSE-driven mortgage subsidies, that President Bush was a mad deregulator rather than a middle-of-the-road compassionate conservative that passed government-centric No Child Left Behind and Sarbanes-Oxley.

There is only one problem with all that stuff.  It is rubbish.  It is liberals pretending to themselves that everything is fine and that the Republicans are a bunch of yahoos.

Eventually all this clever spinning and cultural hegemony catches up with you.  And it could be that it's catching up with liberals this year.  

The Three Strikes Democrats

What is wrong with the economy?  Why won't it rebound from the depths of the 2006-2009 recession?

Simple.  The Obama administration has got the three basic things wrong.  Three strikes, and you are out!

Strike one: Government Spending.  There is one simple thing to understand about government spending.  It is a weight on the economy.  Yes, there is a grain of truth in the Keynesian idea of stimulus, but not much.  Look, it stands to reason.  Government does stuff that people won't do on their own without the spur of government compulsion.  Obviously, businessmen and consumers will have already sniffed out the best profit opportunities and price bargains before the government steps in.  So it stands to reason that government will be doing the Solyndra stuff, paying for things that do not pay.  Education and health care, of course, are just Solyndra writ large.  But if you want to grow the economy, you need to reduce government spending.

Strike two: Money and Credit.  Juergen Habermas calls money a "steering medium."  Its purpose is to help people figure out what to make and what to buy.  Sounds simple, but of course the credit system is much more than that, and the clue is in the word itself: "credit" which comes from the Latin credere, to believe.  The whole money and credit system runs on the faith in the "soundness" of the other guy, that he or she will honor his obligations, even when the going gets tough: especially when the going gets tough.  But governments have always been mucking around with the system.  In the first place they need to borrow money, so they are big players in the money market.  In the second place they are always using their market and their sovereign powers to influence the money market, usually by pushing for cheap credit, or inflation.  Government manipulations of the credit system can help in the short run, and are needed to win wars.  But in the long term, the credit system needs to be allowed to do its job, to get money from where it is to where it is wanted.  If you mess with the credit system you will end up with bubbles and crashes.  If you want to grow the economy you need to stop messing with the credit system.

Strike three: Regulation.  Everyone agrees that the economy cannot run without laws and regulations.    Everyone agrees, in principle, that the laws should prevent people from "externalizing" their costs.  But that's easier said than done, because people disagree about the future.  Is burning fossil fuel a benign act, or does it compromise our future with resource depletion and global warming?  But regulation is also a temptation for powerful interests to implement their agenda using their political power.  Dense administrative regulations benefit existing large players against new small players.  So whenever you implement new regulations you are probably helping the big interests and harming the little guy.  Think Sarbanes-Oxley that has introduced huge regulatory burdens on corporations and Dodd-Frank that has increased regulatory burdens on banks.

You can see why it's Three Strikes against the Democrats.  In the first place, they believe in more government spending.  Years ago, they used to justify it on the basis of justice.  But now that government is so big and so intrusive they have started to justify government spending as "investment."   But government spending is still waste.

Democrats also believe in manipulating the credit system.  That's why they blamed the Crash of 2008 on "greedy bankers" instead of their own crazed mortgage credit subsidies.  The whole game of central banking, whatever it once was, has now completely subjugated the money and credit system to the needs of government.  The whole business of subsidy and credit manipulation is poison to the health of the economy and the prosperity of ordinary Americans.

Then there is regulation.  In the old days, the socialists believed in the nationalization of the means of production.  That was a complete bust.  But now the socialists and their heirs, the "progressives" realize that they can occupy the commanding heights of the economy much better by regulation and administrative control of private industry than by outright nationalization.  For one thing, under nationalization, the losses of the nationalized companies had to be covered by borrowing and taxes, but under regulation, private business has to find some way or other of staying in business.  Under socialism, the monkey is on the government's back; under administrative regulation the monkey is on the corporation's back.  But the result is the same.  You create distortions and waste in the economy that eventually, like a building in Havana, crashes to the ground because nobody was taking care of it.  Regulation hurts the little guy.

Fix any one of these, and the economy will improve.  Fix any two of them, and the economy will really improve.  Fix all three, and it's Katy bar the door.

How come this is so hard for people to understand?

The Speech at the End of the Liberal Universe

One of the reasons that I created usgovernmentspending.com back in 2007 was that I was getting fed up with the way that Democrats always acted, year in and year out, as if we were doing nothing for children, for seniors, and leaving the poor to starve.

Please.  This year, according to usgovernmentspending.com, we are spending $1 trillion on government pensions, $1.1 trillion on government health care, $0.9 trillion on government education, and $0.7 trillion on government welfare (above and beyond Medicaid).

So the president in his soaring acceptance speech talks about doubling down on education:

I promise you – we can out-educate and out-compete any country on Earth. Help me recruit 100,000 math and science teachers in the next ten years, and improve early childhood education. Help give two million workers the chance to learn skills at their community college that will lead directly to a job. Help us work with colleges and universities to cut in half the growth of tuition costs over the next ten years.

Just a minute, Mr. President.  We are already spending $941 billion a year on education.  What on earth are you proposing here?  What about all the money we are already spending on government education?  Because, given the dismal results that government education has turned in, I have another idea.  It is this.

Why in the world would we put politicians in charge of education?

I mean it, Mr. President.  Politicians are the residual legatees of the hunter-gatherer war-party.  The idea is to attack the neighboring tribe in a dawn raid, kill the men and take the women, and take over their territory.  Loot, plunder, and rapine: that's what politics has always been about.

But in the last two centuries, as the ruling class stopped believing in God, politicians have stepped into the empty place left by the death of God.  They have started preaching gospels of hope like revivalist preachers.  Not hope in the life hereafter, but hope in the here and now.  That's what the welfare state is all about: loot.  That's what taxing the rich is all about: plunder.  But now the secular agenda of fighting for loot and plunder is joined to the transcendental moral agenda of fighting for good against evil.  It is good to force others to pay for your loot, and it is evil for the rich to keep their ill-gotten gains.

In the last century, the game has changed again, as women have got the vote.  Now politicians don't just talk about loot and plunder, but of the leader's love for his wife, the leader's devotion to the education of children, the leader's determination to care for the sick.  Those chaps know what they are doing.

But the problem is that the politicians keep talking as though we weren't already spending $941 billion a year on education, $679 billion a year on welfare.  They say: We've got to make education the best in the world!  We've got to help the folks down on their luck!  As if we are not already spending obscene amounts already.

The real agenda at the end of the liberal universe is how the heck do we get out of this mess?  How do we take all these profoundly social tasks away from the residual legatees of the tribal fighters and the warrior lords of the land?  How do we return social assistance and mutual aid to the carers and the helpers and away from the fighters and the dividers?  Imagine what we could do with the $4 trillion a year that gets sucked up into the welfare state and then spread out to the supporters of the politicians, less a finder's fee to the political class.

The answer to the question is, of course, in the person and the life of Mitt Romney.  We must accept that capitalism is "creative destruction" just as Joseph Schumpeter told us.  It is a cold and heartless system, but it delivers prosperity like you wouldn't believe. Whatever we may dream of, capitalism is the only thing that works on the economic front, and Mitt Romney has practiced capitalism full throttle. Mitt Romney knows capitalism.

So much for the system side of life.  But then there is the human side of life, the "lifeworld," the world of humans as social animals.  You could do a lot worse that the Mormons, with their "fairly strict" moral world, where everyone has to contribute time and money to social purposes, and young men have to go on an adventure of service before they can get their sacred underwear.  And then they have to go through the chairs and serve as bishop of their ward and president of their stake when the call comes.  Mitt Romney's life is a witness to the Mormon approach to realizing people's social nature as social animals.  Mitt Romney knows the social life of caring and sharing.

What is the meaning of life, the universe, and everything?  Who knows?  But at least we know one thing.  We know what it isn't.  We know that it isn't Barack Obama's world of of politics as secular religion.

Nobody Home?

It's unfortunate for the Democrats that their God-and-Jerusalem convention blunder came on the same day as the hot excerpts from Bob Woodward's latest White House tell-all book.  Bob suggests that there is nobody home at the White House.  From Speaker Boehner about the debt-ceiling deal:

"The president was trying to get there. But there was nobody steering the ship underneath him," Boehner told Woodward. "They never had their act together. The president, I think, was ill-served by his team. Nobody in charge, no process. I just don't know how the place works. To this day, I can't tell you how the place works. There's no process for making a decision in this White House. There's nobody in charge."

And then Bill Clinton reminded us that, all in all, it's just as well that presidents can't run for a third term.  The dear old chap does run off into the weeds.

After Wednesday, September 5, 2012 you can see why things like governments, corporations, and campaigns need good management and organization.  When you have a bunch of people gathered together in some cooperative endeavor it is really hard to make things happen, to make the trains run on time.

The real hit on the Obama administration is that it failed to adjust its agenda in January 2009 from rushing through the liberal agenda to fixing the economy.  No surprise there.  Liberal governance is built upon the idea that the economy can take care of itself.  While the economy takes care of itself liberals will apply the patches and programs needed to make it just and fair.

That works most of the time, especially if like Kennedy, like Carter, like Clinton, you are coming into office about a year after the bottom of a recession.  But the evil Bush cunningly delivered the economy to President Obama before it had really started to fire on all cylinders.  And Obama just went ahead with business as usual, assuming that the hallowed Keynesian recession remedies would work.

Only they didn't.

In my view, the economy needs, above all, to fix the underwater mortgages.  I don't know what the best way is.  Inflation?  Liquidation?  Principal adjustment?  Who knows.  But until the credit system is working, with all normally "sound" borrowers back above water, you can forget a booming economy.  Capitalism works on credit.  Credit means faith, confidence, etc.  When people don't have faith in the other guy then they start to put their money under the mattress, buy gold, and hunker down.

I read someone the other day who wrote that the Obama people don't understand money.

Somebody else wrote that the problem with financial crises is that the last big one usually happened before anyone now working in finance was old enough to go to work.  So the people trying to solve the crisis are usually flying without a seasoned instructor in the cockpit who has seen it all before.

It would help to have someone in the cockpit that really understands finance.  Let's see.  Would that be a chap who spend a couple of decades dealing with failing companies?

Nah.  Much better to go with a community organizer that can deliver a really good speech in a stadium.

Meanwhile, is anybody at home at the White House?

Michelle Obama vs. Ann Romney

In the old days they didn't think about having the candidates' wives up at the national political conventions telling us all about their families.

But now it's essential.  Why?  Because of the women's vote.  Women don't abstract politics and its issues into a corner.  They see politics as part of their entire world of relationships.  And they judge the worthiness of people they know by their familial performance.  They need to know how a president relates to his wife and children.  And more than men, women need to know that the president "cares about people like me."

So how well did Ann Romney last week deliver, compared to Michelle Obama this week?

I'd say that Ann Romney did the job, which was to humanize Mitt Romney.  You could tell that her speech was a duty, a job that she had to do for her husband's sake.  You'd never know, from the mainstream media and President Obama's negative ads, that Mitt Romney is an exemplary man and husband.  Now we know.

But Michelle Obama is a politician, and it shows.  So her speech was a bravura performance from a real pro, combining touching stories from her family with heartfelt advocacy for her husband's liberal vision.

Of course, there isn't much difference between the two parties on the ends of politics.  We all want a prosperous world where kids get a good education, everyone can get health care, and old people get cared for in their golden years.

Everyone agrees upon the ends of politics.  The differences arise when we get to talking about means.  How do "we" educate our children.  How do we help the poor?  What do we do about health care?  What do we owe our parents in their declining years, and how do we deliver that care?  And who is "we?"

The difference between liberals and conservatives is stark.  Liberals believe that most of these social goods should be delivered through politics and government on the basis of "rights," a right to education, to health care, to income support.  Conservatives believe that most social goods should be delivered through "civil society" associations like churches, unions, and fraternal associations and mutual-aid societies.

Liberals base their "rights" talk on the Exploitation narrative.  The reason that people can't get the material goods they need is because it is denied them by an unjust ruling class and the savage ways of the market economy.  What's needed is a new ruling class that will redistribute the spoils of economic exploitation to the people that have been, up to now, denied access to these necessary social goods.

Conservatives base their "civil society" talk on the Invisible Hand narrative.  People are naturally social; they instinctively act to offer services to others in return for the material things they need to live and prosper.  But there is a problem.  It is the "freeloader" problem.  Some people take advantage of the system to take but not make.  There's the husband who won't work or deserts his wife and children; there's the slacker at work.  There's the neighbor that won't keep his yard clean.  There's the bum that would rather live rough than get a job.  Conservatives believe that if you get most people to join civil society associations then you take care of the "freeloader" problem.  That's because nearly all humans care about the good opinion of the people they know.  And people know who is slacking and who is pulling their weight.  Once you have taken care of the freeloader problem then the safety-net problem becomes much simpler.

Of course, society can never be a pure government welfare state; nor can it ever be a pure conservative civil society state.  But right now, conservatives argue, it is tilted too far towards the government welfare state and that tilt encourages freeloading and a destruction of healthy societal cooperation.  Liberals don't think we have gone far enough in guaranteeing rights.

Which brings us back to mom and apple pie.

Everyone wants our president to be a good man.  Everyone wants a world with education for children and care for the poor and the aged.  And everyone wants to look to the future with hope.

The question is: which way to the future is better?  And how much is enough?

The American people will get to adjust the "which way" and the "how much" in November.  Not by a lot, of course.  But certainly enough to make a difference.

Over the Cliff? Or Not?

There's a chilling article by Nicholas Eberstadt from last weekend in the Wall Street Journal about the progress, if you like, of entitlement spending.  Back at the beginning of the 1980s about 30 percent of US households were getting benefits from the government.  Today it is about 50 percent.

So you can understand the pessimists that say it is useless to expect anyone to fix the federal budget.  After all, since the time when the Franks were invading the German lands a thousand years ago for loot, politics has been about paying off your supporters.  What politician is going to do that?  Before the money runs out.

When the money runs out, of course, things get interesting.

The Republican line in 2012 is simple.  Let's "do something" about entitlements before the money runs out.  But are the American people listening?  If 50 percent of the people are already receiving federal government benefits (like me) then won't they opt for continuing the benefits in the hope that the next generation will the one that goes over the cliff?

It's interesting to wonder what the voters will decide, especially in light of the analysis of Joel Kotkin.  He argues that the Democratic Party has moved away from Bill Clinton's attempt to appeal to the center.  The party is now an "upstairs/downstairs" party of the urban gentry and the minority dependent class.

After decades of fighting to win over white working- and middle-class families, Democrats under Obama have set them aside in favor of a new top-bottom coalition dominated by urban professionals—notably academics and members of the media—single women, and childless couples, along with ethnic minorities.

And, of course, the center of gravity of this coalition is single women, as "more than half of all American women are single."  Now you understand the "war on women."  But the problem is that the new coalition has pushed away the center ground,

the predominately white working- and middle-class families whose goals centered around achieving home ownership, basic essentials, and the occasional luxury. These groups have been leaving both the core cities and the Democratic Party for generations.

The problem is that the "upstairs" part of the new Democratic coalition has done very little for the economic improvement of the "downstairs" folks, the minorities.  It's all very well to have cities that appeal to the single twentysomething.  But what about the minorities living in the city that don't got no jobs?

The truth is probably that the "downstairs" people will, like the servants in the TV series Upstairs Downstairs, identify more with the reflected glory of the "upstairs" family and be content to molder their lives away achieving nothing rather than take the risk to break away from the basement in Eaton Place and climb up into the challenge of middle-class responsibility.

Of course, if the government goes over the cliff, then the "downstairs" folks are screwed.  And the "upstairs" folks will somehow get by.

The Left is Not Dead

It's easy to imagine that the left is dead, unable to produce an account of the world that even begins to pass the laugh test.  Here is Michael Ledeen writing about an Italian lefty that got religion.

I have a good friend, an Italian who lives in Milano, who for a while was the head of the youth organization of the Italian Communist Party. One day he was walking across one of the major Milanese piazzas, and had an epiphany, which he later described very simply. “I shouted, ‘There is no working class!’”

There is no doubt that there was a time when an identifiable working class existed, but the world changes, according to Hegel, and so people must update their thinking. Only,

there are plenty of people who can’t update their thinking. They’re easy to recognize, because they write and talk about a world that no longer exists. The easiest places to find them in contemporary America are Hollywood, college campuses, and the Obama administration with its attendant satellites, the dead tree media and the Democrat Party. Their common bond is anger and frustration; frustration because they can’t understand what’s going on, and anger because their remedies for contemporary problems do not come to grips with the essence of the problems.

And so, Ledeen writes, the "left has ceased to exist as an intellectual force worth taking seriously."

That's interesting to me, because the subtext of my forthcoming book "An American Manifesto" is that we conservatives ought to take leftist thought more seriously, that we ought to get familiar with it, and understand what it is trying to say.  Here is a quick review of the best in leftist thought.

In The Dialectic of Enlightenment Max Horkheimer and Theodor Adorno unpack the idea of "enlightenment" and decide that it is all about domination, the domination of nature and other men.  In The Theory of Communicative Action Juergen Habermas develops the idea of the systems world of instrumental reason, the world of capitalism and bureaucracy, and the "lifeworld" where people exist not by systemic rules but by language, persuasion, and consensus.

Then there is the lefty trilogy by Michael Hardt and Antonio Negri: Empire, followed by Multitude and Commonwealth.  It is a noble attempt to resurrect the Marxian idea, the Exploitation narrative, for the 21st century.  Instead of the bourgeoisie, we have "Empire," the global cabal of national political powers and global corporations.  They call this phenomenon "Biopower".  Instead of the working class, they propose "Multitude."  The Multitude represents groupings of singularities in the world of work, no longer the "habit" of work in mass-production factories and offices, but becoming a culture of "performance" in creative occupations and productions of "affect".  The new multitude calls for a new "life in common".

Could this new form of social life use constitutional means to "establish a democracy from below of free men and women" they ask?  Unfortunately not, for the Multitude will realize itself in a spasm of revolution, a moment of "Kairos", the "moment when a decision of action is made".

Assuredly, the left is not dead.  It has plenty of ideas that take for granted the Exploitation narrative, and call for revolution to bring on the millennium of peace and justice.  And conservatives all across the world will have to fight their ideas and their eternal lust for political power and street action.

As long as there is government there will be exploitation and injustice.  Government is force, and force is unjust.  These days the problem is the huge and unjust power of the global educated elite that has tricked the Multitude into exchanging its birthright for a mess of pottage.  The question for the future is whether conservatives can persuade the Multitude that the problem is the educated elite, or whether chaps like President Obama can persuade the Multitude that the problem is chaps like Mitt Romney and  companies like Bain Capital.