Month: November 2017

OK, so maybe this is a bit frivolous, but I don’t have to write about war and taxes all of the time.

The first season of “The Crown” was slow, but compelling, TV.  Mostly set in the 1950’s, the implicit message of the program was that the lives of members of the royal family were subject to government control in a way that virtually all of the rest of us would find completely intolerable.  Choices on where to live, whom to marry, what kind of job is suitable, and so on were completely limited by the system, which turned royal rebels like Edward VIII (who nonetheless comes across as a grifter in the show) into pariahs.  Accepting those limits was a form of duty and patriotism.

I say “was” because it is clear that Princess Diana changed everything.  Diana insisted that she had rights to live what the rest of us would call a normal life, and so did her children.  The result is a matter of public record.

Today, the British public, and even the royal family, seems accepting of the notion that Prince Harry can marry a biracial divorced American woman just because he loves her.  What does that mean?  Well, mostly nothing;  I’ve never taken the activities of the royals very seriously as history.  However, it does seem to confirm my opinion that the UK has become more free and open, and far less class- and tradition-driven, than it was when I was there in 1979.  And that, on balance, is a good thing.

As I, and numerous other commentators, have noted previously, blustering about the North Korean nuclear program creates the potential for uncertainty about motives and, therefore, could result in an unwanted war in and of itself.   If you assume, however, for purposes of argument that we won’t just stumble into war over rhetoric, how do you tell the difference between bluster and reality?

The salient facts are as follows:

1.  The Trump Administration doesn’t really want war.  If it did, the war would already have started.
2.   Nothing short of war is going to stop the North Korean program.  Period.
3.   The program is moving steadily to the point where it threatens mass destruction on the US mainland.  The time to act is running out.

And so, in the final analysis, North Korea has already made its choice to create a nuclear program that threatens the US, and the Trump Administration will ultimately have to choose between war and deterrence to keep it at bay.  Based on what we’ve seen so far, it appears that deterrence is going to win, but that isn’t set in stone.

Everything else–all the tests and all of the verbal threats–is just noise.

The tax cut bill resembles the various Obamacare repeal bills in the following ways:

1.  The fundamental premises of the bills were lies.  In the case of Obamacare repeal, the GOP promised legislation that would provide more and better insurance even though the party’s actual position was to require people to have more “skin in the game.”  With the tax cut, the lie is that the bill is directed at the middle class;  it isn’t.

2.  The bills were rushed through the system in an effort to head off opposition.  This tactic appears to be fairly successful, and will probably be emulated by the Democrats in the future.

3.  The bills were hideously unpopular with the public, but moved forward, anyway.   The GOP apparently decided that failure to produce a product was more politically damaging than producing a product that hurts millions of Americans, many of them GOP voters.

4.  The bills have the support of the PBP and Reactionary factions of the GOP.  In the case of the PBPs, the motive, of course, was tax cuts.  The Reactionaries wanted Obamacare repeal because it would deprive millions of undeserving poor people, many of them minorities, of an ill-gotten government benefit.  They don’t stand to gain much from the huge tax cut for plutocrats, but at least it will be a “win” for their guy, which, apparently, is enough.

5.  The potential opponents are the same.  The CD and CL factions of the GOP have equal and opposite issues with both bills.  The CLs are concerned about deficits and excessive government regulation;  the CDs are concerned that the bills hurt poor people in the interests of the wealthy.

6.  The bills are jury-rigged pieces of legislation designed to meet Senate rules and get 51 votes;  they make little sense from a policy perspective.  No elaboration is required.

In the case of Obamacare repeal, Dudley Do-Right managed to free the damsel in distress from the railroad tracks just in the nick of time.  Will that happen with the tax bill?  I’m guessing not, in which case the GOP will have to live with the consequences of its success, which probably won’t be pretty.

One last word on the subject:  the donor class is happy with the tax bill, as it should be, but the benefits to rich people revolve primarily around rising share prices.  What happens if the market falls for other reasons?  Then even the principal recipients of the bill won’t gain anything, and the bill will be a failure even as a quid pro quo.

On the GOP bill to cut tax.

Its supporters ignore all the facts.

The bill is a crock.

It should come as no shock

That the leadership’s covering their tracks.

 

A more detailed discussion will follow.

Trump’s trip to Asia gave us a glimpse at what could be a radical shift in American foreign policy:  the US could temporarily resolve its trade deficits with Japan and South Korea, while eliminating the cost of protecting both nations, by selling them hundreds of billions of dollars in high tech weapons, including nukes.

This would be a stunning reversal of 70 years of American policy, and it would make Asia a far more dangerous place to live.  But hey, that would be their problem, and America first–right?

Imagine that you are Shinzo Abe.  The cause that drives you, above everything else, is the revision of the constitution that was imposed on Japan by the Americans after World War II.  There are a number of reasons for that:  part of it is the desire to “normalize” your country and its defense policies; part of it is a denial that Japanese aggression caused the war (understandably called the “War of Japanese Aggression” in China); but a big part of it is a realistic appraisal of the military and economic threat that a rising China presents to an island nation with long, exposed sea lanes.

The current constitution has substantial support in the Japanese public and will be difficult to change.  Fortunately for you, you have two unlikely allies:  Kim Jong-Un and Donald Trump.  The former has been lobbing missiles through your country’s air space, and needs to be deterred;  the latter complains endlessly about America’s trade deficit with Japan, and can’t be relied upon in a conflict with China or North Korea.

There is a logical way to deal with this situation:  buy hundreds of billions of dollars worth of arms from the Americans, including nuclear weapons, in order to close the trade deficit, protect the nation from the crazoid in North Korea, and free yourself from dependence on the American military.  That approach solves all your problems at once, and provides a strong justification for your constitutional amendment.

Now, imagine that you are Xi Jinping.  You have always maintained that, however bad the regime in North Korea might be, letting it collapse would be worse.  Is that really true if maintaining the regime means that Japan will have nuclear weapons?

There are no good options for Xi here.

Not without reason, David Brooks thinks America is coming apart at the seams. He blames in more or less equal parts the right, for exalting money, the markets, and the interests of wealthy people over the community as a whole, and the left, for emphasizing freedom and group victimhood over responsibility and national solidarity.

There’s a lot of truth in that, but he rarely has anything meaningful to say about what needs to be done to get back to Point A from Point B.  On its face, the logical contenders are:

1.  A charismatic politician who seeks to bring the nation back together.   We tried that, and it didn’t work.

2.  A religious revival.  You can’t make people believe in things that don’t make sense to them.  In any event, conservative Catholics are more interested in the “Benedict Option” than community outreach, and the evangelicals voted for Trump.  Good luck bringing the country together with that.

The closest American analogy I can think of is the 1920’s, when technological change, unequal economic growth, scientific advances, and opposition to Prohibition probably created something of a similar environment (think the public reaction to Al Smith’s presidential campaign).  How did that end up?  With two disasters that brought the country together:  the Great Depression and World War II.  That’s what it might take today, and Trump is certainly capable of providing the disaster.

As I’ve noted previously, Netanyahu had an opportunity to crush Hezbollah while it was engaged in Syria, but he turned it down, presumably in the belief that a war involving two enemies only worked to his advantage.  However, Assad and his friends have broken the stalemate and won the war.  As a result, Hezbollah is now more of a threat than ever.

The latest odd events involving the Lebanese government have made it clear that Saudi Arabia is perfectly willing to provide diplomatic cover for an Israeli invasion of Lebanon in the Sunni world.  There is nothing to stop the Israelis from using all of Lebanon as a battlefield.  The Trump Administration presumably can keep Iran from intervening directly by promising fire and fury. That means the way is clear for a fight to the finish with Hezbollah.

Will Netanyahu take the bait?  He has the reputation of being a human steamroller in the US, but he has preferred to limit his military actions to the gnat that is Hamas and to use political influence to force the US to solve his Iran problem.  This would be a completely different ball game.   Having said that, south Lebanon is a bit like the West Bank in reverse;  the facts on the ground don’t favor Israel, and are getting worse.  Sooner or later, something will have to be done;  it’s just a question of time.

I’m back.  I will resume normal blogging tomorrow, but I thought I would reflect on my trip for everyone’s benefit while it’s still fresh in my mind:

1.  The Japanese are quiet and obsessively polite.  The Chinese are much more boisterous and have no trouble telling you what they think.
2.  It is actually easier to find fluent English speakers in China than in Japan.
3.  There is a vending machine about every 100 feet in Japan.
4.  American ATM cards reputedly only work in 7-11s in Japan.  Fortunately, they’re everywhere.  On the other hand,  using American credit cards can be an adventure in China.
5.  It’s easier to find a vending machine than a trash can in Japan.  You are apparently expected to carry your trash with you, which is ridiculous.
6.  Chinese taxis are dirt cheap, but you get what you pay for.  Japanese taxis aren’t, and again, you get what you pay for.
7.  Both Chinese and Japanese bullet trains are excellent.
8.  Chinese people in urban areas typically live in cookie-cutter high rises that look like dominoes from the air.  Japanese people in most areas live in single-family homes on tiny lots with no lawn.  I have no idea how they handle surface water management, given the amount of impervious surfaces.
9.  Green space in Japan outside of the mountains typically consists of tiny rice farms near the railroad tracks.
10.  As you would expect, the Chinese have far better ancient history museums.  The Japanese, on the other hand, do a much better job of juxtaposing glass and steel buildings with landscaping.  Their modern buildings are absolutely gorgeous. We could learn a lot from them.
11.  Both Chinese and Japanese businesses are, by American standards, grossly overstaffed.  In China, this manifests itself in lots of people in uniforms looking bored and doing nothing in particular.  In Japan, the excess workers are there to provide a very high level of service.
12.  The beef in Japan is excellent.
13.  You can’t read the NYT in China, and a CNN story on a Chinese dissident resulted in a black TV screen for several minutes.  Otherwise, you don’t really feel the government at all.
14.  Chinese people will occasionally stare at you.  The Japanese don’t.
15.  I’m a giant in Japan, but not in China.
16.  Both countries have high tech toilets.  Simple American toilets are better.

As you would expect, I don’t listen to right-wing radio or watch Fox News. However, it is my understanding that right-wing commentators, by and large, are spending far less time defending Trump than attacking his critics.  That makes sense, from a commercial perspective, because Trump can obviously be difficult to defend, and because the Reactionary train runs on anger, not hope.  There are always plenty of liberal villains to attack, and it keeps the base excited.

Trump governs pretty much in the same way.  Instead of reaching out to his critics and providing a message of hope and unity, he openly bashes everyone who isn’t completely loyal to him and shows his solidarity with his base.

The problem, of course, is that attacking Hillary Clinton a year after the election doesn’t exactly help you get anything done on health care and taxes.  Beating up on cuckservatives and liberals isn’t a governing philosophy;  it’s just a way to divide the country and blow off steam.  And so, the fate of the tax cut will ultimately rest in the hands of GOP senators whom he has gone out of his way to insult.  No one rooting for the tax cut can feel very comfortable about that.

I will be out of the country until November 25.  Regular posting will resume when I return.

Winners

1.  Plutocrats:  True, the top individual rate remained at 39.6 percent, but the overall changes to the tax brackets still result in a cut, and the big picture items are the corporate tax cut, which will enrich shareholders, and the phased abolition of the estate tax.
2.  Upper-middle class people in red states:  The increased standard deduction and the new 12 percent bracket will help.  The 401(k) escaped the chopping block, at least for now.  The SALT and mortgage interest deduction limitations won’t matter much here due to relatively low property values and state taxes.

Losers

1. Upper-middle class people in blue states:  Elimination of most of the SALT deduction and the capping of mortgage interest may result in an overall tax increase for some of these people.
2.  The real estate and development industries:  Demand for expensive housing will be reduced by the SALT and mortgage interest changes.

There is no economic rationale for rewarding upper-middle class people in red states and punishing the same people in blue states;  that’s all about trying to turn blue states red.  I addressed that in a previous post.  I’m sure the decisions to phase in the estate tax repeal and keep the 39.6 bracket will be spun as a preference for middle-class people over the wealthy.  Don’t believe it, because it simply isn’t true.

I don’t know Ross Douthat, but he seems to have a gift for pulling my chain.  His latest provocation was a column in yesterday’s NYT in which he attributes anomie and totalitarianism to the peace of exhaustion and the strengthening of the state which followed the Reformation.

Here are my comments:

1.  Thomas Cromwell was a committed Protestant, not a secular figure who worshiped the state.  His ultimate political failure came when he got too far ahead of Henry VIII on doctrinal issues.
2.  The argument that Catholic imperialism was more benign for the subject people than the Protestant version doesn’t even pass the straight face test.
3.  Douthat believes that the Church, in time, would have found a way to accommodate the political and scientific advances of the Enlightenment.  That conclusion is based on . . . what?  The Church had fought all sorts of heretical movements ferociously and successfully long before Luther;  why would anyone believe that would change in the future?  There was no indigenous Enlightenment among the Sunnis within the Ottoman Empire;  why would a universally Catholic Europe have been any different?
4.  While you can fairly say that Communism is the product of the Enlightenment, it is worth noting that it first took root in a country that didn’t experience the Reformation–Eastern Orthodox Russia.
5.  Today’s international institutions are very limited and purely pragmatic measures that were created to deal with the aftermath of World War II.  They are in no way analogous to the Church, and are not its tepid replacement.
6.  Would you rather live in 13th century Europe than America in 2017?  Would the benefits of an undivided Christendom outweigh the lower standard of living?  I think not.

 

 

Macron developed a center-right program outside of the existing party system and succeeded in blowing the system up.  Could that happen here?

It’s easy to imagine how it could work.  GOP members appalled by Trump and Democrats concerned about the potential costs of a Sanders presidency could come together with a program based on relatively open borders (no protectionism), acceptance of current law on abortion and gay rights, no significant tax increases or decreases, support for climate change regulation, increased infrastructure spending to boost growth, and moderate cuts to entitlement programs.

Is it realistic?  Probably not, for two reasons.  First, the party system is far more entrenched here than it is in France, where the conservatives change their name about every five minutes.  To my knowledge, there is no French equivalent of Fox News or our beloved right-wing talk show hosts.  Second, in order to win, the new grouping would have to coax almost all of the PBP voters away from the GOP without promising them big tax cuts.  I can’t see that happening in the absence of a complete Trump Administration meltdown.