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Some commentators describe Piketty as a sort of neo-Marxist.  Are they right?

No.  The central thesis of Piketty’s book is that, under normal conditions, the rate of return enjoyed by the wealthy on their investments exceeds growth in GDP, which means the rich, relative to the rest of society, get richer.   The thesis is supported by substantial historical data.  He makes it clear that extraordinary conditions, such as war and large policy shifts, can override the general rule.  In other words, the rich getting richer is not the result of some sort of natural law.

Piketty doesn’t embrace dialectical materialism, the labor theory of value, or the other critical Marxist concepts that I addressed earlier in the week.  And so, while his thesis does sound vaguely Marxist, it is inappropriate to associate his views with orthodox Marxism.

Sarah Kliff, the best writer on American health care policy, has started a new series on health care unit prices on Vox this week.  To no one’s surprise, she has concluded to date that the cause of soaring American health care costs is our unit prices, not overuse of the system by consumers, and that neither political party has much of a plan to deal with them.

Given their ideological perspectives, how should the two parties address costs?

The Democrats view the health care market as being inherently flawed, and believe that more government intervention is necessary.  That can be accomplished through the direct regulation of prices and by the creation of a consumer cartel with overwhelming market power (i.e., a single-payer system). Single-payer would only reduce prices, however, if the government is willing to stick it to an enormously wide range of health care providers, not just the drug and insurance industries.  Thus far, there is no evidence of that; I’ve never heard Bernie Sanders complain about grossly overpaid doctors and nurses, because to do so would be politically unpopular.

Republicans purportedly believe the solutions to the problem lie in the proper use of market forces.  If that is truly your position, you should be breaking up producer cartels, limiting the value of patents, encouraging more providers to enter the system (largely through increased immigration), and doing everything possible to make pricing transparent.  None of this figures in any of the GOP plans to date. The GOP actually believes the problem is overuse arising from third-party payments, in spite of all of the evidence to the contrary, and its only “solution” to high prices is to suppress legitimate demands for service, which is no solution at all.

According to Marx, once the last vestiges of the bourgeois regime have been destroyed by the dictatorship of the proletariat, the state will serve no purpose, and will simply wither away.

Right.  For some reason, I didn’t see much evidence of a withering state in Beijing during the Party conference yesterday.  Raul and Kim don’t seem too keen on it, either.

Ross Douthat had a column in yesterday’s NYT in which he essentially argued that the GOP should return to the Christian Democrat program of George W. Bush.  Douthat concedes Bush’s many failings, but contends that most of his agenda was designed to help working and middle-class people, and notes that the Trump agenda consists of noise directed at Reactionaries and actual measures designed for plutocrats.

As usual, Douthat is partly right and partly wrong.  His description of Trump is perfectly accurate.  I don’t buy his argument that the Bush economic agenda of tax cuts for the rich and deregulation was part of a CD program;  it was pure PBP. I do agree, however, that the rest of his domestic program was primarily CD, and that the Republican Party would be a lot more sane if it returned to it.

Unfortunately, for some reason, the failure of the Bush Administration resulted in a repudiation by the GOP of, not nation-building, reckless deregulation, and constitutional violations, but programs like No Child Left Behind.  There is no reason to believe this will change in the foreseeable future.

According to Marx, the bourgeois capitalist state would fall as a result of its contradictions, and power would pass to the proletariat, which would use it to create a classless society.  There would be an interim phase in which the proletariat used the power of the state to eliminate the vestiges of what Marx considered a dictatorship of the bourgeoisie.  The transitional phase was dubbed “the dictatorship of the proletariat.”

Of course, in the real world, nothing like this happened.  The revolution came in agrarian countries, not the advanced capitalist western European nations.  The proletariat was not up to the job of revolution.  The task of representing the presumed interests of workers fell to a self-appointed group of middle class intellectual conspirators who called themselves the Communist Party.  The dictatorship has lasted 68 years in China, and there is no end in sight. . .

Marx famously “turned Hegel on his head” when he came up with the concept of dialectical materialism.  Both believed in what is frequently called “the arc of history,” but while Hegel saw that in terms of ideas, Marx saw it as a product of changing means of production.  In the penultimate stage, that of bourgeois capitalism, the means of production would be owned by a small and shrinking group of capitalists who would be overwhelmed by the instability of their own system and the numerical predominance of the working class.  Revolution, the dictatorship of the proletariat, and a peaceful, classless society would be the happy result.

Marx claimed to be a “scientific” socialist, but dialectical materialism isn’t science, and it isn’t based on history;  it is more accurately described as philosophy, and maybe even religion.  The theory can’t be tested in the real world, and the events of the last 150 years don’t support it.  What has happened, in reality, is that the capitalist system has been buttressed by the welfare state, and that advanced economies are primarily based on services, not manufacturing.   Marx did not foresee those developments.  The classless society is nowhere in sight.

When I consider the prospects for an independent Kurdistan, I think of the following precedents:

1.  The French Republic in 1792.
2.  Israel in 1948.
3.  Poland in the late 18th century.

France was a reasonable match, in terms of population, economic strength, and military might, for its adversaries in 1792, so that analogy won’t really work. You’re left with the relatively miraculous survival of Israel and the dismemberment of Poland as the realistic analogies.

Israel was a very, very special case.  I don’t see any plausible future for an independent Kurdistan, even though it would meet my criteria for secession, without vigorous material and diplomatic support from the United States.  That clearly is not happening; the Trump Administration, like its predecessors, prefers a united Iraq even if it is subject to Iranian influence.  Whether that is a wise decision under the current circumstances is definitely open to debate.

In the Marxian world, the all-important class structure is dictated by the nature and ownership of the means of production.  Like virtually every Marxist idea, this one hasn’t worn well over time, largely because:

1.  The classical and feudal worlds were very different places, but the means of production didn’t change much over that time.  The transition from the one to the other was driven by forces other than technological change and corresponding changes to the class system.
2.  Marx was overly impressed by industrial machines and factories, and did not pay enough attention to the rest of the 19th century economy.
3.  In an economy largely dominated by services and intellectual property, a development that Marx didn’t foresee, the means of production is typically a laptop computer.  Virtually everyone in this country has access to one of those. As a result, if the analysis ever made any sense, it doesn’t in today’s world.

It was a long time ago, but I can still remember coming home to Florida for Christmas break after a dispiriting  first semester in law school and being shocked by the intensity of the light.  It felt like stepping from a black-and-white movie to technicolor.  My depression broke, and things were easier from that point forward.

It’s appropriate that Beck called his new CD “Colors.”  If “Morning Phase” was a grand, sweeping description of depression, “Colors” is a bright cherry popsicle. Its influences come from here, there, and everywhere, but the overall effect is as euphoric as a Beach Boys record.

“Colors” was conceived prior to Trump’s election, and had nothing to do with him.  It won’t pick up the hurricane debris in your yard or keep us from being blown up.  But for 40 minutes, it can make you forget your troubles and leave you glad to be alive, and that is no mean feat today.

It’s the 100th anniversary of the Bolshevik Revolution, give or take a few weeks, so this week will be dedicated to a critique of critical elements of Marxist thought, starting with the labor theory of value.

To my knowledge, there are three theories of value that have predominated throughout the centuries:

1.  The “just price,” which bases the value of goods on religious principles.
2.  What you could call the “free market” basis of value, which is simply what a buyer is willing to pay for an item in an arm’s length transaction in a free market.
3.  The labor theory of value, which substantially predates Marx, but is an integral part of his thinking.

The labor theory of value works very well for examples involving hunters and gatherers.  After that, it doesn’t work at all.  How do you apply it to goods manufactured by machines? How do you apply it to the labor of animals?  How does it account for inflated prices for rare stamps and coins that were produced with the same amount and same kind of labor as the mainstream items?  Is intellectual property the product of labor in the same sense as a manufactured product?  If so, is the value based on the amount or the quality of the intellectual activity that created it?  If the latter, how would you measure it?

“Just price,” on the other hand, presupposes religious principles that are, to say the least, not self-evident.  The only theory of value that works consistently is #2.

This week’s issue of The Economist identifies Xi Jinping as the most powerful man in the world.  Do you think Trump is going to take that lying down?  Didn’t think so.

During the run-up to the Brexit referendum, Boris Johnson was famous for saying that the UK could “have its cake and eat it, too;”  a deal giving the UK everything it wanted, with no trade-offs, was available if only its negotiators would take a stronger stand.  He’s still saying it today even though the EU has done nothing to soften its position, and the clock is ticking on a disastrous no-deal exit.

Trump’s position on the Iran deal, NAFTA, and practically every other American agreement is the same:  a much better deal is out there if we are willing to throw our weight around a bit more.

The NAFTA talks reportedly are on the verge of collapse.  The other parties to the Iran deal have no interest in renegotiating it.

Any predictions on how this is going to turn out?

Trump really, really wants a war.  Bibi and the Saudis will egg him on in their own interest.  Mattis will enable it, because he hates the Iranians.  Congress won’t stop it, and the base will accept it as long as we fight to “win.” So it’s inevitable.

But what will it look like?  Here are some critical questions and answers:

1.  When will it start?  Mattis will put it off until we’re finished with North Korea.  Reasonably enough, he won’t want to deal with two crises at once.

2.  How will it start?  I predicted months ago that it would be a naval incident.  I still think that is the most likely precipitant, but there are other possibilities: some sort of armed clash in Syria;  a ballistic missile test; something involving Hezbollah and Israel.

3.  Will we have any support from our allies?  Only from Israel and the Sunni despots.  Otherwise, we will be completely isolated.

4.  Will it involve a ground invasion?  No.  That would be too hard, bloody, and expensive.  Trump’s idea of a war is a bomb, a parade, and a statue, not what happened in Iraq.

5.  What will our war aims be?  Initially, this will probably be an Israeli-style exercise in “cutting the grass.”  The key, unanswered question is whether it can be limited to that.  It will depend largely on the Iranians.

6.  Could nuclear weapons be used?  In the immortal words of Sarah Palin, you betcha!  Trump would love the idea of being the first leader in history to annihilate an entire country using nukes.  It would prove that he was the biggest and baddest man of all time!  Believe me.  Believe me.

Imagine, if you can, that you work for Donald Trump.  Your boss, above all, wants to be popular, and to be seen as “the man.”  He has a bad temper and a thin skin. He doesn’t have fixed ideological views on most subjects, but he does have personal biases, and he thinks it is essential to maintain good relations with his base.  He hates being told that he can’t do anything he really wants to do.  Having complained about essentially everything that Obama did in office, he is determined to obliterate his legacy.  Finally, he values loyalty over competence, but for him, loyalty is purely a one-way street; if anything goes wrong, he will throw you under the bus.

The problem is that most of what he wants to accomplish is clearly harmful to his party and to the American people.  How do you make him happy without leading the country to destruction?

The answer clearly is, encourage him to take half-measures and leave the rest to Congress.  By doing that, he appears to keep faith with his base, while leaving open the possibility that Congress can fix the problem he is creating, maintaining plausible deniability for any resulting damage, and opening GOP congressional leaders to criticism if they don’t clean up the mess.  And so, we have the DACA decision, the sort-of decertification of the Iran deal, and his efforts to compel action on Obamacare repeal by damaging the insurance market.

Given the differences of opinion among the GOP factions, it is far from clear that Congress is in a position to address the issues that Trump is creating.  If you’re a sane and moderate GOP congressman, that should terrify you, because Trump is likely to blame you and the other swamp creatures for everything that goes wrong between now and the 2018 election, and his supporters will probably agree with him.

 

You would think that the thrice-married casino owner from Manhattan would be an unlikely champion of traditional values, but this is 2017, and things are different now.  The latest attack is on the availability of birth control, and is clearly consistent with the Reactionary position that birth control is evil because it removes an essential sanction from immoral sexual behavior. In other words, avoiding the social ills associated with unwanted pregnancies has a much lower value than preventing extramarital sex.

This from a man whose affairs were described in hot and heavy detail in the New York tabloids.  If there is a silver lining, it is that the apparently absurd association between Trump and right-wing culture war positions is likely to erode public support for both over time.