Month: August 2017

The 45th President Don.

He hasn’t a clue what goes on.

His vaunted tax plan

Is just kicking the can.

You could call it a typical con.

                      Poor Poor Pitiful Me

Well, I stood all day in the employment line

For a job at the factory.

But they’re only hiring nurses now.

Poor poor pitiful me.

 

(Chorus)

Poor poor pitiful me.

Poor poor pitiful me.

The world’s passed by

Just don’t know why.

I’m a victim now, can’t you see.

Woe, woe is me.

 

Well, I met a man at the U of A

Trying to buy books for the school year.

I looked around, then I asked him, “Hey!

How on earth did you get in here?”

He looked surprised, but then he told me why.

“It’s a thing called affirmative action.”

Whites like me need not apply,

He said with some satisfaction.

 

(Chorus)

 

Parody of “Poor Poor Pitiful Me” by Warren Zevon.

It is reasonably clear at this point that the GOP tax cut plan will retain the mortgage interest deduction.  Here are the pros and cons of that approach, from my perspective:

Pros

1.  It is appropriate for the tax code to promote home ownership, because home owners are more vested in the community and are thus better citizens than more transient renters.

2. Eliminating the deduction will cause home values to fall, thereby making millions of Americans poorer.  The last time that happened, the economic result was disastrous.

3. The deduction creates a mild stimulus to construction, which in turn provides jobs at decent wages for just the kind of people who have been struggling.

Cons

1. Would reducing home values and thereby making housing more affordable be such a bad thing?
2.  Encouraging Americans to put their money in housing, as opposed to other assets, is an unjustified intrusion into the market that has, in the past, promoted damaging real estate bubbles.
3.  Encouraging home ownership has reduced the mobility of labor and thus damaged the economy.

To me, this is a fairly close argument.    If it were up to me, I would probably support a slow phase-out of the deduction as a compromise, but, of course, it isn’t up to me.

The details of the tax cut plan are still under discussion, but its general parameters are fairly clear;  the centerpiece will be a cut in corporate income tax rates, which will be offset at least slightly by the elimination of some deductions. The GOP then intends to sell this plan, not as a reprise of the Bush tax cuts, but as a populist measure that will create jobs, increase wages, and punish the rich.

It will do nothing of the sort, of course.  The primary beneficiaries of the plan will be the fabulously wealthy, and there is every reason to believe that the outcome will be share repurchases and increased dividend payments, not new investment.

While Trump is poorly qualified to be president in more ways than I can remember, he is eminently qualified to take on the task of selling this plan to the American public.  It is Trump University on a massive scale.

David Brooks says the GOP has changed for the worse, and cannot stand.  Back in the day, when he worked for conservative publications, he never heard racist remarks in the workplace or at parties, and the GOP leadership fought fiercely against racism.  Since 2005, however, the white identity element of the party, while still not a majority, has increased substantially in size, and now controls the White House.   It’s not a pretty sight.

The reality of the situation is much different.  I’m willing to accept that Brooks and his former colleagues aren’t racist.  However, the GOP has always relied on white nationalist votes during my lifetime;  they are (and have been since the 1970’s), in fact, the core of the party in many areas. The PBP faction has used them in order to obtain tax cuts and deregulation for business.  The white nationalists (Reactionaries) finally figured out that they weren’t getting anything out of the bargain except some lip service, and demanded change.  The Trump presidency is the result of their frustration.

If the Reactionaries ultimately split off from the rest of the party, they will win majorities in most southern states,  the remnant GOP will win some western and midwestern states, and the Democrats will prevail everywhere else.  There go your big tax cuts!  That’s why it probably won’t happen.

The argument in favor of the state and local tax deduction is clear and simple:  it avoids requiring the taxpayer to make a payment with funds to which he has no legal title.  Repealing it would cause even more hardship than, for example, imposing a tax on unrealized capital gains;  at least in that case, there is an asset that could be sold to pay the tax.  One might as well tax pots of gold at the end of the rainbow.

It appears that the GOP tax reform plan will nonetheless end the deduction, mostly for ideological reasons.  The idea behind it is to force blue states to become more like red states:  in other words, to change their high taxing and spending model.  This is, of course, a violation of the federalist principles that many Republicans pretend to espouse, but only at their convenience;  if you don’t believe me, ask any GOP politician whether he thinks abortion should be lawful on demand in blue states if Roe v. Wade is overturned.

There are enough GOP House members from blue states to prevent this from happening.  Will they follow the party line at the risk of their own political survival?  That is the key question on this front, and I do not pretend to know the answer.

Sheriff Joe and Harvey are butt-kicking winners like me!  Very impressive!  Wish they could help me drain the swamp in DC!

When Barack Obama was on an overseas trip early in his term, he was asked a question about American exceptionalism.  His apparently tactful response was that every country rightly considered itself to be exceptional for one reason or another. Republicans went ballistic over the supposed lack of patriotism that his remark displayed, and his comment was part of the basis for the bogus GOP claim about the “apology tour.”

Strictly speaking, of course, Obama was right.  However, American exceptionalism traditionally has differed from most kinds of exceptionalism in that it focuses, not on language, religion, culture, or ethnicity, but on our political system.  Americans believe their system of limited government, individual rights, and the rule of law is the best in the world, and will work for everyone.  Just as our country is made up of the descendants of immigrants, and can be viewed as a sort of UN in miniature, so the rest of the world can learn from our example.

The irony, of course, is that the new Republican president doesn’t view the world in this way.  Trump is a blood and soil nationalist with minimal respect for any legal limits on his power.  He would fit better in Poland or Hungary than here.

Believe it or not, I occasionally have dreams about politics.  This is the fruit of one of them.

It occurred to me last night that the GOP’s position on pretty much everything can be reduced to two words:  GOVERNMENT SUCKS!  At best, it’s horribly inefficient and can’t get anything right;  at worst, it actively operates against your values and interests (if you are a Reactionary).  While the government was giving us Iraq, Afghanistan, stagnant wages, and Obamacare, the private sector was creating the iPhone and Twitter.  And so, the best course is always to put your faith in the private sector if you want to get something done.

My reactions are as follows:

1. Yes, sometimes government actually does suck.  For example, if the GOP can’t raise the debt ceiling, and thereby does untold damage to the economy for no good reason, that would be one of them.
2. The Trump presidency should be enough to end our hero-worship of businessmen.  What if John Galt is actually an unhinged moron?
3. The paradox of the GOP argument is that it may or may not apply when they are actually in power.  The argument becomes stronger the more the GOP flounders, which may actually work to their advantage.
4.  Does American government usually suck?  It depends on whether the glass is half empty or half full.  If you lived in a third world country, you would say no.  I don’t know of any jurisdiction in the US where the roads aren’t maintained, the trash isn’t picked up, criminals aren’t jailed, and the parks and libraries aren’t kept open.
5.  The John Galt wannabes who say that everything should be left to the private sector don’t have any understanding of how the government permeates everything we do.  For example, the iPhone wouldn’t work but for a host of federal regulations.  And John Galt uses the roads and the parks and the libraries and the judicial system just like everyone else, only more so.

Government is, at its essence, a service provider.  Every new proposed government program has both costs (including opportunity costs) and benefits. You can have a reasonable debate about whether any particular program is worth it; politicians should do their best to see that the debate occurs in the open, and is civil.  But you can’t get anything done if one side simply asserts that all government programs are wasteful and evil, because that isn’t true.

As a developer and businessman, Donald Trump called himself “The King of Debt,” and had reason to love low interest rates.  Candidate Trump, on the other hand, mouthed orthodox GOP blather about how the Fed was corruptly debasing the currency to prop up the Obama agenda.  Given his concerns about GDP growth, President Trump has powerful incentives to ignore his campaign rhetoric and promote low rates.  How will he attempt to resolve these obvious contradictions?

Given Trump’s aversion to everyone and everything tied to Obama, it was never likely that he would reappoint Janet Yellen, which presumably is why she felt empowered to disparage his regulatory agenda.  My guess is that he will nominate someone with few, if any, previously expressed views on the subject. The nominee will obfuscate and essentially tell everyone what they want to hear, will be confirmed, and then will be an inflation dove in practice.

After the departure of Bannon and the epic flip-flop on nation-building in Afghanistan, Matthew Yglesias wonders what the point of a Trump presidency is, if you are a Reactionary.  If Trump is going to govern as an inept and corrupt orthodox Republican,  what practical benefits does he have to offer his base?  Wouldn’t they be better off with Mike Pence, or even Jeb Bush?

From a purely policy perspective, the question makes perfect sense, but the fact is that for Reactionaries, style is substance.  Trump throws them red meat every day.  He makes them feel appreciated.  He reminds them constantly that he is on their side in their battles against minorities, foreigners, and pagans.  For them, every outrage, and every breach of protocol, is just more proof that he is not the kind of establishment politician who has been selling them down the river.

In short, Trump is gambling that he can screw over his base with tax and benefit cuts as long as he consistently shows them love.  It will probably work.  It has, so far.

 

Based on the speeches he gave the last two days, there are two politicians named Donald Trump.  The first of them is an extension of his businessman persona I will call “The Dealmaker;”  in spite of his innumerable flaws (ignorance of policy, thin skin, obsession with “winning,” etc.), this one is an orthodox politician who reads from a teleprompter and does his best to get business done and unite the country.  The second is a raging demagogue who does nothing but throw red meat to his Reactionary base through tweets and campaign appearances;  this one looks more like an angry stand-up comedian than a politician.

Both his supporters and his detractors naturally view the unscripted demagogue as being the more “authentic” version of Trump.  I am beginning to think, however, that part of his frustration with the media is their inability to see that the two personas are, in his mind, completely compartmentalized.  In other words, only the words and actions of “The Dealmaker” are meant to be taken seriously as policy by the MSM;  the tweets and outrageous statements at rallies are just a form of entertainment for his Reactionary base, and for himself.

If I’m right, and I think I am, this approach brings a level of cynicism and dishonesty to the presidency that has never been seen before, and it is no surprise that the rest of the world doesn’t get the joke.

In “The English Constitution,” Walter Bagehot divided the functions of government into the “dignified” and the “efficient.”  The “dignified” element, personified by the Queen, inspires the feelings of loyalty and unity that are an essential part of nationhood.  The “efficient,” personified by the Prime Minister and members of the cabinet, actually gets things done.

The American system requires the president to perform both functions.  Trump is a grotesque failure as the “efficient” leader of the country, but his shortcomings are even worse on the “dignified” side.  He projects an America that most of us cannot recognize.  He is thin-skinned, narcissistic, and arrogant, and he lies all of the time.  He does not appear to have any kind of a sense of empathy.  He is the supreme divider, not a uniter.

Thus the case for an American monarchy.  But who might the monarch be?  After all, the US isn’t the stuffy old UK.  We need a monarch suitable for the age of reality television.

Say hello to Queen Kim and the House of Kardashian!

Trump characteristically told the country we would fight to “win” in Afghanistan on Monday night.  Yesterday, Rex Tillerson indicated that the point of the troop increase and the supposedly new strategy was actually to create breathing space and a stalemate which could ultimately lead to successful negotiations with the Taliban.  Tillerson’s comments were, of course, much more realistic;  their significance is that they point out just how little faith we can put in anything his boss says.

On a related note, Trump apparently complained during his Phoenix rally that the media pay too much attention to his tweets.  After you stop snickering, consider what he really meant by that:  there is a whole category of presidential speech is that mostly intended to fire up his base, is not intended to be viewed as objectively true by the public, and should not be judged as such.

In other words, the most powerful man in the world feels entitled to lie any time he wants if it serves his purposes.  No wonder he complains that the media treat him differently than any other president;  he is different than any other politician in my memory.

FAKE NEWS SHOULD STOP PAYING ATTENTION TO MY TWEETS!!!!