Cromwell

It’s interesting that Trump and the GOP continue to poll so poorly even with the economy roaring along.  Either the American public is sophisticated enough to understand that Trump doesn’t deserve the credit for the economy, or, more likely, it is more moved by values.

And so, it seems, Bill Clinton’s slogan wasn’t necessarily correct.  The economy matters, but values matter more.

In a column in the NYT last Friday, David Brooks opined that the left was in sight of total victory in the culture wars, but risked a political backlash by pressing their advantage too hard.  Was he right?

Mostly, yes, but I would frame the issue a bit differently:

1.  Anyone who watched the Oscars on Sunday would have to say that the left has already won the culture wars.
2.  The problem is that the left sees its position as being so self-evidently correct that it attaches little or no value to its victory, and continues to search for other battles to fight.
3.  The right has responded, not by engaging with the left, but by retreating to a Fox News-fueled bubble, and by throwing its energy into politics.  The evangelical right’s embrace of Trump is the logical conclusion of this phenomenon.
4.  Thus, the backlash is already here.
5.  Can it get worse?  Demographics are already working against the right.  One can imagine a situation ten years from now where a large segment of the right starts supporting out-and-out fascists in the face of continuing defeats in both the cultural and political arena.
6.  And so, if the left wants to keep the country we have, a degree of empathy and compromise would help.

Salt-of-the-earth white Christian farmers came out in droves to vote for a thrice-married Manhattan casino owner because, as the GOP nominee, he clearly embodied their conservative values even though he promised to engage in trade wars that were not in their interests.  Today, they are facing the prospect of being used as hostages in the trade wars, and they’re unhappy.

Just what exactly did they think was going to happen?  Oh, well; they may not be able to export, but at least they have Gorsuch.  Surely that is enough.

No.  Italy is much larger; from the EU’s perspective, unlike Greece, it’s too big to fail.  It’s still growing; its economic problems are chronic, not acute.  Slow growth there is attributable to domestic causes, not the euro and the EU in general.  And it didn’t fudge its statistics.

Is Italy the new Poland or Hungary?  No.  I don’t see enough evidence of support for “illiberal democracy.”  The citizenry is just upset about slow growth and immigrants, which should sound familiar to Americans.

The outcome of the election puts Italy in a position similar to where it was, say, 40 years ago;  the largest party is considered unfit for government.  The difference is that the EU only existed in embryo back then, which means that the rest of Europe has more of a stake in the Italian government than it did then.

It’s going to be a bumpy ride.

Life in the time of Trump.

The trade war has begun.

A tariff here;

A quota there;

We’ll all lose when it’s done.

To disregard consumers

To save steel jobs is dumb.

But that’s the way the world works

When trade is zero-sum.

The German CDU/SD coalition is finally a done deal.  In the short run, this guarantees stable, reasonable, and mildly progressive government.  In the long run, it’s a disaster;  the far right will become the focus of the opposition, and will have a chance of being the largest party at the next election.

In Italy, the election has brought chaos, and a very large anti-EU vote.  That will present a challenge the likes of which the EU has never seen, to my knowledge. More on that tomorrow.

Reactionaries have long taken the position that the GOP represents the opinion of a majority of real Americans, and that Democratic victories must therefore be attributable to voter fraud on the part of minorities and illegal immigrants. That is the reason the GOP continues to pound the voter fraud drum and promotes inappropriate restrictions on voting even though there is absolutely no evidence of fraud making even the slightest difference in any election since 1960.

It occurred to me this morning that there is a real danger that Russian meddling in our elections, whose practical impact has probably been grossly overblown, could well turn into the left-wing version of the same phenomenon, particularly if the GOP manages to hang onto both houses of Congress this November.  If we get to the point where large segments of both parties reject the legitimacy of our elections, the system is in real trouble.

Putin and Xi would love that.

The analogy to the Thirty Years’ War looks better by the day.   As it stands today, there are no less than four separate, but occasionally overlapping, conflicts in Syria:

1.  IS against the rest of the world;
2.  Assad against the rebels;
3.  The Turks against the Kurds, with the US attempting to smooth things over, and Russia throwing gas on the fire; and
4.  The US, Israel, and Saudi Arabia against Iran and Hezbollah, with Russia supporting the latter group.

The first conflict is coming to a close.  The second is winding down, but will not be finally resolved as long as the rebels have international support and a place of refuge in neighboring countries.  The third will never really end, at least as a political issue.  The final one is the one that matters to everyone who doesn’t live in Syria.

When it’s all said and done, my best guess is that the analogy will hold, and Syria will return to something similar to the status quo ante, only as a complete ruin.

Imagine that you are a London businessman doing extensive business with EU countries.  Jeremy Corbyn has just announced that he supports a very soft Brexit, while the government keeps staggering on to what looks like a disaster.  What do you do?

On the one hand, you know that Corbyn, in his heart of hearts, hates capitalists like you. You can expect nothing good from him.  On the other hand, the government doesn’t know what it’s doing, and Corbyn would have to govern in a coalition that would restrain the worst of his impulses.

It’s a tough choice.  My guess is that British business will continue to support the Conservatives and hope that sanity prevails in the end.  It may not.

 

Here’s what I take away from Trump’s announcement on steel and aluminum tariffs:

1.  To Trump, not all jobs are created equal.  Jobs that are typically done by strong men matter;  others don’t.  Brawny coal miners and steelworkers are his kind of people;  installers of solar panels and sales clerks aren’t.
2.  At a time when we need the assistance of our erstwhile allies in pushing back North Korea, Iran, China, and Russia, launching a war against the entire world makes absolutely no sense.  That, of course, counts for nothing; it’s all about pleasing his base.
3.  How will the world retaliate?  The politics of this will matter.  Trump doesn’t care if Boeing loses, but he and his party will be concerned if the impacts are felt largely by farmers.
4.  Trump clearly believes that American market power, like American military power, is so predominant that we can tell the rest of the world where to go and get away with it.  That, of course, feeds into the narrative spread by Putin and Xi that irresponsible American power needs to be checked.  It’s probably also dead wrong.
5.  This is one area in which the interests of the Reactionaries and the PBPs are completely opposed.  How will the GOP react?  Will there be any really effective opposition to a trade war?  I’m guessing we will hear some loud complaints, but see no real action.
6.  The good news is that the trade war will probably force the Democrats to embrace free trade instead of trying to outbid the GOP.

1.  There is a lot of fear that this opens up the door to some form of neo-Maoism.  I doubt that will happen.  The course that Xi has set (mercantilism, repression, and assertion of national rights abroad) is based in precedent, has the apparent support of the country and the party, has been successful by most standards, and is unlikely to change dramatically.
2.  One of the biggest challenges facing China is the ability of the central government to get local officials to follow its mandates.  This will probably help a bit.
3.  Is the anti-corruption program for real, or just a means by which Xi punishes his enemies?  We’re about to find out, because sooner or later, all of his enemies will be gone.

The great would-be emperor Xi.

From his term limits he’s become free.

He’s shown he’s the man.

Does that come with a plan?

For the rest of us, what does it mean?

Here’s how it could all go wrong:

1.  Multiple realo candidates split the realo vote during the primaries.  The Democrats consequently nominate a fundi, who promises to roll back the entire Trump tax cut and to use the money for massive new spending programs, including single-payer.
2.  Alarmed by the anti-business tenor of the Democrats’ campaign, Michael Bloomberg decides he has to take the plunge and runs for president.
3.  The CDs and disaffected PBPs who might otherwise support the Democratic candidate are put off by the tax increase and promises of new spending and vote for Bloomberg.
4.  The Reactionaries, as usual, vote for their values, not their economic self-interest.  They stick with Trump.
5.  Some moderate Democrats vote for Bloomberg.  The new voters who are supposed to deliver the revolution do not show up (they never do).
6.  As a result, in spite of his unpopularity, Trump wins a smashing victory in 2020 over a divided opposition with 40 percent of the vote.  The madness intensifies.

Assume, for purposes of argument, that conditions in 2020 are pretty much the same as they are now:  there is no war or recession, and Trump’s approval ratings are around 40 percent.  How will the Democrats go after him?

The task, in a nutshell, is to either entice large numbers of new voters into the system, or peel off enough 2016 Trump voters to prevail.  Conceptually, there are two ways to do this:

1.  The Competence Coalition:  The objective here is to win over the CDs and some disaffected PBPs–particularly suburban women–who held their noses and voted for Trump in 2016 because they simply couldn’t swallow Hillary.  The candidate in this scenario would be a realo, and the program essentially would be to restore the Obama status quo, with the exception of the tax cut, whose more popular features would be retained.  No new large spending programs would be proposed.  The focus of the campaign would be on putting an end to Trump’s corrupt, divisive, incompetent, and faux populist administration.  “Stop the madness” would be an appropriate slogan.

In other words, it is the 2016 Clinton campaign, minus Hillary, and with four years of experience with Trump.

2.  Vive la Revolution!  In this scenario, the Democrats nominate a fundi, who blows off the CDs and PBPs and attempts to win by flipping the Reactionaries on economic issues and by bringing new voters into the system.  The Democratic platform proposes to roll back the entire Trump tax cut and to use the money for new spending programs, including single-payer.  The premise is that a full-throated left-wing platform is necessary to motivate the opposition.  Trump is attacked primarily as a faux populist who sold out to Wall Street.

This is the Sanders scenario.  How it ends will be discussed in my next post.

The Trump tax cut is a gamble at two levels.  In the short term, the GOP is hoping that the small increase in net earnings that most people will experience will give them a boost in the 2018 elections even though the bill will cost other people money and primarily benefit the donor class.  In the long run, the hope is that the bill will encourage new investment to the point that productivity and wages will rise dramatically and the deficit will actually fall.

Will it work?  The evidence thus far predictably indicates that most of the corporate tax cut will be spent on dividends and share repurchases, not on new investment.  As a result, asset prices will rise and inequality will increase.  The scene will thus be set at some point for the next Great Recession, not a productivity boom.