Nothing wrong with capitalism, the capitalists are the problem

In March 1964, a group including Linus Pauling, Gunnar Myrdal, Tom Hayden, Ben B. Seligmanm and computer pioneer Louis Fein sent a letter to President Lyndon Johnson covering their report on “The Triple Revolution.” The letter began: “We enclose a memorandum... prepared out of a feeling of foreboding about the nation's future. The men and women whose names are signed to it think that neither Americans nor their leaders are aware of the magnitude and acceleration of the changes going on around them. These changes, economic, military, and social, comprise The Triple Revolution. We believe that these changes will compel, in the very near future and whether we like it or not, public measures that move radically beyond any steps now proposed or contemplated.” They were right about the changes but underestimated our ability to drift towards the iceberg most would not see until much later.

The three revolutions were in cybernation, weaponry and human rights. The nuclear and other new weapon systems threatened peace. The African American struggle for equal rights in the US was part of the rising demand around the globe for full human rights. But the report focused on the affects of the cybernation revolution (their term). The combination of the computer and automation was issuing in a new mode of production as different from the industrial as that was from the agricultural. It would result in “almost unlimited productive capacity which requires progressively less human labor.” Yet the current economic model awarded access to this production, to the wealth it created, unequally to those with capital and those who earned their keep through labor. The cybernation of production would mean increasingly less of good paying industrial jobs. The US was experiencing this process first but it would spread throughout the world we dominated.

The report argued that having access to the collectively produced wealth of society could not any longer be tied to labor. Maintaining and improving individual wellbeing across society – through making maximum use of the potential of automated production – would have to transition from depending on good paying jobs. Income would have to be separated from work. This would require some form of guaranteed individual income and vast investment in public goods. Left to itself, the market would not move in this direction, it would require government action.

As it turned out, capital figured out a way to exploit the new cybernetic economy by shifting production to automation (and now AI) and to areas of cheap labor. Some developing countries – like China – followed suit using their cheap labor to industrialize. This form of globalization produced cheaper goods and did lift many from poverty, worldwide. But it mostly benefited capital rather than labor.

The Western democracies did little to ensure the political sustainability of free trade globalism. This would have required providing those reduced to un- and under-employment or low-paying service sector jobs with the decent income and public goods (including improved education, free healthcare and jobs created through spending on updating infrastructure) that we could have begun 60 years ago. The Western European democracies did a bit better than the US with their social welfare programs but still found themselves in this 21st Century facing the political drift to the right fueled by those left out of the wealth creation.

In the US, we got Trump and his MAGA movement. This virulent form of the anti-globalism reaction has plunged the world into Trump’s tariff war on the very foundations of the world capitalist order.

Nothing wrong with capitalism, indeed there seems to be no good alternative to markets coordinating supply and demand. Free trade to maximize market functioning is part of this (with some measures perhaps needed to ensure fair trade). The World Trade Organization could expand its trade liberalization agenda to include mandates to improve local living standards alongside fair labor standards. Rather than make war on the system of rule-based trade that we have benefited from, the US government would encourage foreign investment in our productive sector as part of a rational approach to whatever re-industrialization makes sense. (This could include China.)

The monopoly capitalists at the top of our cybernetic economy are the problem. They need to be taxed at levels considerably greater than their workers. Their ability to wield political power through money needs to be ended. Government must be empowered to ensure that everyone benefits from market functioning even if this means a form of guaranteed minimum individual income. The Democrats need to do more than wait for Trump to fail. Railing against the billionaires must be accompanied by explaining the need for change and advocating the policies laid out in that report to Johnson.

Watching President Trump

In my previous piece, I laid out what another Trump presidency might look like. In short, if he does what he said he would do during the campaign: chaos. But it could also be, if not actual fun, certainly interesting – an experiment, if you will – to watch him do, try to do or, in the end, not do all the things he said. The list is a long one:

• seeking revenge on his opponents, including by weaponizing the Justice Department;

• imposing high tariffs on China and goods not made in America;

• putting Musk in charge of making more government more efficient (apparently by stopping all $2 trillion of USG discretionary funding);

• letting RFK Jr. “go wild” on health issues such as vaccines and fluoride;

• rounding up and deporting 20 million “illegals” using police and the National Guard;

• preventing by various measures “illegal migration” and finally building that wall;

• supporting a wide open field for crypto including Bitcoin;

Now, it may be that the Trump will not take any of these actions. The Republican leadership – and JD – may focus instead on using control of all three branches of government to do the things the party has always sought to do, provide tax cuts for corporations and the rich, dismantling “troublesome” regulations on business as well as consumer protections and ending efforts to combat climate change. There are also positive elements among the many other promises Trump made during the campaign, such as ending taxation on Social Security or providing payments for IVF. This approach would make the new Trump Administration a “normal” one in which the ruling party carries out its own ideological platform (with or with out elements of Project 2025).

But what if Trump does try to take action against political opponents and “illegal migrants” using the justice system, law enforcement and the military? This could result in considerable activity in the courts. If the military is asked to undertake actions forbidden under the Constitution – such as domestic law enforcement – relations between the Commander-in-Chief and the military leadership could become very tense.

Discretionary spending ($1.7 trillion in the 2023 budget) includes the military ($806 billion, where surely there must be considerable waste) and everything else the government does including education, social services, health, transportation, science and technology, justice and local development. Leaving aside the military (?), allowing Musk to dismantle the social safety net and backbone of our economy built up over the last several decades would have a serious social and economic impact. Raising tariffs – and therefore prices – of everything we now import – also causing shortages of needed goods that we cannot yet produce in quantity – could plunge the economy further into a downward spiral. Rounding up “illegals” and stopping the flow of migration into the US – if even possible – would reduce the supply of labor in the many places in which no one else wishes to work. Allowing an unfettered field for crypto-currency speculation could add financial turmoil to economic disruptions.

Empowering Kennedy to turn the U.S. health system into a haven for anti-vaxers and anti-fluoride, flat-earthers could lead to more pandemics and a legion of new dental patients.

Trump has also said he would settle the Ukraine war even before taking office and has vowed to bring peace to the Middle East. These too will be interesting to watch, especially the process of picking the losing and wining sides. It may also be “fun” to watch our NATO allies try to back fill their ability to go on their own. And the whole world may experience economic and political tremors.

Some of the 71 million majority who voted for Trump could experience a bit of buyers remorse. But he may not have any interest in matching his election campaign performance with real life action. It may also be that his supporters really don’t expect him to do so. In any case, we will all have front row seats.

PS: A friend reminded me of this from H.L Mencken:

Democracy is the theory that the common people know what they want, and deserve to get it good and hard.

So what if Trumps wins?

If Donald Trump wins the presidency on November 5, it will be the third time this century that a Republican has won with a minority of the vote. This owes to the anti-democratic elements of our 18th Century Constitution (the Electoral College, Senate and Supreme Court). The Republican Party is a minority party riding on every advantage our outdated system gives it. They win – with help from the Russians and arrogant tech lords like Musk – by converting Trump’s clownish authoritarianism into the false consciousness of whites who feel threatened by the increasing diversity of America despite being themselves among the richest 4% of the global population.

What would Trump’s victory mean? One can consider the U.S. domestic implications and the impact on the world in general.

Domestically, Trump will seek political vengeance while using the justice system to avoid prison. (Avoiding prison is his main reason for running.) His cohort of Project-2025ers will seek to undermine the administrative state while using state power to favor those capitalists that see government as hindrance. Together they will probably throw our economy, politics, courts, health & education systems, social safety nets and society in general, into turmoil. Their efforts to govern through authoritarianism and populism – the essence of MAGA – will test our democratic institutions and wreck havoc.

But we are not Weimar Germany. Our institutions will hold, although any Trump effort to use the military for domestic actions – such as dealing with “illegal migration” – could lead to a real crisis. It may well be that in the midterm elections of 2026, the upheaval would be enough to lead to a Democratic resurgence. (It will be interesting to watch a Vice President Vance. He could call the policy shots from the background. As an opportunist par excellence, he may be sensitive to the popular reaction to the various outrages pushed by the P-2025ers and tack accordingly.)

A Trump regime’s impact on the world stage is another matter. He will favor isolationism, economic nationalism, unilateralism, pro-Russian approaches in Ukraine and Eastern Europe, disengagement from the Mideast and who knows what with North Korea. This will fundamentally weaken the global position of the U.S. But let’s consider this from the 35,000 foot level.

The U.S. has held center stage in the world since the end of World War II. The various political and economic institutions of the global order – including the UN, IMF, World Bank, NATO etc – were ours by design. We established the contours of the Cold War that divided the world into good guys and bad guys and led to many distortions of the domestic affairs of other countries. After the fall of the USSR, we found other ways to define bad actors by choosing – often unwisely – which regional states to offer favored status and protection. As we began to lose our industrial advantage – with other economies coming online – globalism became our religion and we used the available levers to impose austerity and free trade everywhere we could.

We Americans have always been pretty self-centered, focused on our own navels. We governed the world – to the extent we did – for our own purposes, assuming that what was good for America was good for everyone. Trump’s obsession on making America “great again” is simply a dysfunctional flavor of this.

Our record as the predominant global hegemon has been mixed, to say the least. The world today can be legitimately described as a mess, with violent conflicts of various kinds and sources, terrorism, mass migration, political polarization, continued poverty and inequality, nuclear proliferation, the emerging technological singularity, and widespread and worsening climate disruptions. The U.S. did not cause any of these – at least not by ourselves – but they all happened on our watch. Meanwhile, the world has increasingly begun to just ignore us. (Watch China, India and the other BRICS cozy up to Putin despite his assault on world order.) Our inability to anything about the Mideast has not surprised anyone but ourselves. Maybe it’s better that we do withdraw somewhat from world affairs and let folks get on with finding their own way? If Trump wins in November, however messy it will be, maybe it’ll be what the world needs?  Like a heart attack that scares you into changing your bad habits? 

(Maybe we Americans will finally upgrade our Constitution.)

The Virtual Crowd

 

Social media and the Internet enable the formation of virtual crowds. Crowds may always be, or become, dangerous.

A friend recently asked me to explain why such large numbers of people – in this case Americans – have come to accept the same body of extreme beliefs. In my mind, this meant the extreme white nationalist and anti-government sentiments that erupted on January 6, 2021. I immediately thought of Freud’s Group Psychology and the Analysis of the Ego. For Freud, society rests on the coercive agency of the Superego (das Uberich) implanted as the child faces its dependency on the world beyond it. This explained for him the peculiarities of crowd psychology – the ready response to Leaders, the need for authority and the eagerness to use or accept repression.

For Freud, the Leader defines the crowd (Masse), taking the place of the internal agent of outside authority (the Superego) left behind by childhood. A crowd is a collection of people mobilized not around a common interest or purpose per se but around a stand-in for the father, be it a collective Superego (ideology or belief/faith instrumentality), a Leader, a hero or a personalized god. This state of dependence is based upon shared feelings of fear and guilt that give outlet to the ambivalence the child directs at the father. Erotic ties (Eros) bind together individuals to each other and to the Leader, around whom all revolves.* The Leader serves as the object for this longing and defines, as father-surrogate, the relation in which all are united as "brothers" in submission to him.

The erotic tie between Leader and follower takes the form of an identification that brings the former into the psyche via the Superego, repeating the process that established it through identification with the first parental authority. Individuals in a crowd thereby come to share the same Superego, submitting to it, in like manner, their individual selves. Crowds, says Freud, are made up of "a number of individuals who have one and the same object in the place of their ideal self and have consequently identified themselves with one another sharing the same [surrendered] self (das Ich)." This bond through identification denies the crowd any critical faculties the individuals, as individuals, may possess and leaves them vulnerable to control by "suggestion."

The crowd represents a return to the primitive horde; in both we find "an individual of superior strength among a troop of equal companions." Freud suggests that fear and anxiety are always at the edge of crowd behavior, tending to increase, not decrease, in the face of challenges to the ties that bind individuals together. The individual in a crowd feels a need for authority that manifests in the submission of his self to the Leader. The Leader has this role because in "...the mass of mankind there is a powerful need for an authority who can be admired, before whom one bows down, by whom one is led and perhaps even ill treated."

For Freud, the principle phenomenon of mass psychology is the individual's "lack of freedom." Civilized man has exchanged a portion of his liberty for a portion of security. Submerged in a crowd, people behave like a collective neurotic. Freud saw such behavior as symptomatic of society, with its origin in the repression of desire and the consequent implantation within each individual of a Superego serving as the internal agent of that repression. The individual is directed toward submission to a Leader or to the over zealousness of compulsive morality continuing the infantile relationship to authority. Over a lifetime, the individual's character and identity are built, largely unconsciously, around that ready submission. The exercise of consciousness is never fully developed and the self is never free to author its rational being.

Culture's reliance on repression (and the other forms of psychic defense) and its extraction of surplus control subjects the individual to an ever increasing burden of guilt even as actual control of desire diminishes. As culture – especially in its Western, capitalist guise – affords humanity more and “better” ways of gaining satisfaction, it creates a larger and larger realm of potential satisfaction it must control. Control inevitably weakens and results in a situation where the erotic drives are only weakly held in check. The aggressive drives, always hard to restrain, become ever more difficult to control as they are increasingly deployed to master the erotic drives. The individual, trapped in this escalating conflict and spiral of anxiety, suffers increasing existential unease (Unbehagen). For we Americans – with a shallow history, a consumer-oriented culture and relatively vast riches unequally distributed – many are ready to "break loose" at any time.

I’ve taken this dive into Freud to get to my further point. In the age of mass social media, crowds may now form virtually. Without direct face-to-face contact, people can come to share a collective consciousness built around submission to some shared beliefs personified by a Leader. The social media niches where such virtual crowds mingle can intensify these beliefs into extreme forms. When the members of these groups actually do come together, they are vulnerable to the Leader’s suggestion and to the apparent dictates of their shared belief system, rational or mostly not. Then all hell can break loose.

* For Freud, Eros is more than sexuality, it’s a longing for something we do not have, for completeness, for other, for beauty, for the good.

Trump Agonistics

 "They say and do not." But the kingdom of God is not in word, but in Power. He talketh of prayer, of repentance, of faith, and of the new birth; but he knows but only to talk of them. I have been in his family, and have observed him both at home and abroad; and I know what I say of him is the truth. His house is as empty of religion as the white of an egg is of savour. There is there neither prayer nor sign of repentance for sin; yea, the brute in his kind serves God far better than he. He is the very stain, reproach, and shame of religion, to all that know him; it can hardly have a good word in all that end of the town where he dwells, through him. Thus say the common people that know him, A saint abroad, and a devil at home. His poor family finds it so; he is such a churl, such a railer at and so unreasonable with his servants, that they neither know how to do for or speak to him. Men that have any dealings with him say it is better to deal with a Turk than with him; for fairer dealing they shall have at their hands. This Talkative (if it be possible) will go beyond them, defraud, beguile, and overreach them. Besides, he brings up his sons to follow his steps; and if he findeth in any of them a foolish timorousness, (for so he calls the first appearance of a tender conscience,) he calls them fools and blockheads, and by no means will employ them in much, or speak to their commendations before others. For my part, I am of opinion, that he has, by his wicked life, caused many to stumble and fall; and will be, if God prevent not, the ruin of many more.... Paul calleth some men, yea, and those great talkers, too, sounding brass and tinkling cymbals.

John Bunyan, The Pilgrims Progress

 

Came across this while reading Bunyan. Not sure how I got into it but it's difficult to put down. The Pilgrims Progress is deep at the source of the evangelical stream of Christianity. Bunyan eschews human law, secular morality and government in favor of the Bible as written. He urges ignoring the visible in favor of the invisible, i.e., the Biblical God. Trump finds his support base among those immersed in this Pilgrim stream. And he's all Talkative.

Can Liberal Democracy Survive?

As authoritarian, repressive and nationalistic political leaders and parties proliferate and the Western democracies waver in the face of the globalization and climate change, it’s reasonable to ask if liberal democracy can survive. Indeed, globalization and its discontents – diminished prospects, resentment, and blame casting – have become a potent political force undermining mutual tolerance, optimism and willingness to compromise without which democracy falters. The non-democratic regimes – China, Russia, Iran, Saudi Arabia, North Korea – see blood in the water and seek to hasten the decline. Others – Hungary, Poland, Turkey – sense the winds and seek to entrench themselves in power through superficially democratic means.

Liberal democracy: an open society with constitutional government based on popular consent, allocation of political power through multi-party elections, separation of powers, rule of law, market economy with private property, and equal protection of human rights, civil rights, civil liberties and political freedom for all regardless of belief, self-identity, race, religion, gender or ethnicity.

Liberal democracy and evolution: Darwinian evolution works through adaption of species to their environment through natural selection, that is, through random mutations, some of which allow individual organisms to reproduce more successfully than others. In this way, a species may evolve over time into something new. Some fail to survive because of environmental changes too rapid to allow time for successful mutations to arise – the Cretaceous impact that wiped out the dinosaurs – or because they become too tied to an environment which then disappears – as happening to lemur species in Madagascar as rain forests fall victim to man.

Although we are social creatures, human nature is highly individualistic. We strive as individuals to survive and thrive in our environment. A liberal democratic society can be thought of as a species that permits the fullest range of random “mutations” as unique individuals are allowed to live and innovate as their individual nature and capabilities allow. Such a society is more likely to successfully meet the challenges of its environment and thrive than one which seeks to limit or control individual variability. Liberal democracy confers evolutionary advantage.

Globalization is an ideology: For decades, liberal democracy has been in the hands of capitalist, rent-seeking elites pushing their self-serving ideology of supra-national, borderless free trade. In the U.S., this has been at the expense of the working class and increased inequality. Those left behind by globalization make up the natural breeding ground of support for the populist, nativist politics used by rightist parties seeking to entrench themselves in power through subverting democratic practices.

But there is nothing sacrosanct about globalization. There is no reason why a polity could not decide to place limits on international capitalism within its borders. It might well value policies in support of domestic labor and domestic production even if it led to higher prices. These could be offset through creation of better paid union jobs, addressing economic inequality with higher minimum wages and perhaps guaranteed minimum incomes, higher taxes on the wealthy and big corporations and rebuilding industry and extending infrastructure green.

Building it back better: Liberal democracy’s evolutionary advantage lies in openness to random change, i.e. economic, technological, cultural and social innovation. To reach its potential, innovation needs enabling infrastructure and a population with full access to public primary and secondary education and opportunities for university and technical and vocational training. It requires mass communication and transport systems available everywhere and at every level. In the U.S., government played a large role here through providing postal services, building roads and supporting rail systems. These could be brought into the 21^st Century by bringing free broadband Internet to every home, small business, library and school. Efficient mass transport networks in cities and through small towns and rural areas would allow decentralization of economic activity without requiring more cars. The Postal Service – with its presence everywhere – provides outlets for delivering not only mail and goods at reasonable cost but also direct government services for individuals and businesses. Government spending to connect and empower small businesses and green industry and innovators would be productive even if it increased debt.

Liberal democracy has considerable advantages over control systems. If the human species – facing our self-created singularity – has a future, it will be in the hands of something like liberal democracy. Survival demands the fullest range of mutation and adaption of which humans are capable. This can be a future in which the United States plays a leading role. Our democracy can fail only at our hands.

What Needs To Be Done

Let us put aside for the moment the fear that Joe Biden’s lead against Trump in the polls is bad because it seems all too reminiscent of Hillary’s last time. Let us also assume that that Republican defeat in November is so complete that the Democrats win both houses. Let us then consider what the agenda should be for a new Biden Administration in 2021.

The first challenge facing President Biden and the Democratic Party will be to begin the arduous process of undoing the damage Trump and the Republicans have done. This means first of all, of course, leading the country in the effort to put the corona virus behind us and refunding state and local governments and health institutions. But also, reviving rule of law and the administration of equal justice, undoing the dismantling of environmental protections, ending the war on immigrants, reimposing federal oversight of local police performance, aiding states to simplify and protect their voting systems, reestablishing our relations with friends and allies abroad and countering Russian, Chinese and other actors waging cyberwar upon us. These reflect simply the requirement to reverse the erosion of governance and national interest inflicted by Trump and his administration but will nevertheless take great effort and concentration.

But the real challenge will be even harder because it will require going beyond fixing what Trump has broken to fixing America itself as the damage predates him. Indeed, Trump is a symptom of the two fundamental and related problems that afflict us: gross and growing economic inequality and partisan tribalism. Economic inequality reinforces both racism and ultra-nationalism and exacerbates racial inequality. Partisan tribalism has made it near impossible to extract rational political debate and responses to the problems we face from our government.

There is no way to tackle economic inequality without re-conceptualizing how we do capitalism. The United States is as near as one can imagine to a completely laissez faire system, in which not only does the market rule in the economic realm but in politics as well. Both parties are fueled by loose money and have long accepted the results of the market, its up and downs, its winners and losers. The Republicans seek the to protect the gains of the winners and ensure that the downturns don’t lead to raised taxes on the rich or efforts to place limits on the way business is done. The Democrats – to give them their credit – have sought to provide and protect minimum social welfare and have begun to do the same with health care. But they too accept market mechanisms as a given.

It is time to place limits on markets, allow them to operate in some areas, limit how they affect others and ensure that their results work for the majority and not only the few. The goal must be to greatly reduce economic inequality and provide basic necessities – including health care – for all as needed.

Partisan tribalism goes back to the very founding of our republic. But the degree to which it has in the last decades overwhelmed the very ability to actually govern is without precedent. Bill Clinton’s effort in the 1990s to take the Democrats towards a more market friendly approach was met with worried warfare by Newt Gingrich and the Republicans. If the Democrats tacked right, the Republicans would go even further in that direction. Since then, they have waged class war in favor of the 1% and against the middle class and the poor by cynically seeking to enlist the latter into an assault on the very government that could protect them. The policies pursued by the Republicans lowered taxes on the rich, cut government services for the non-elite as much as possible and covered everything in the rhetoric of patriotism and charges that the other side were socialists. The Democrats seemed obvious to the possibility of representing the 99% (with Hillary actually calling them the “deplorables”). The Democrats therefore implicitly eschewed the class approach to the political war waged against them instead sinking into a morass of contending internal constituencies each seeking to tear their own piece of flesh from the party and its candidates. Bernie Sanders – not surprisingly an independent – understood this dynamic and sought to bring the party to its natural base. The Democrats twice refused. (Whether or not Sanders was too “socialist” to be elected leaves open the question of whether Elizabeth Warren was overlooked because she was too much a woman.)

Trump may bring the Republicans to their knees. But this will not by itself end the tribalism. Indeed, it seems time for the Democrats to go on the offensive. Clean up Trump’s mess, begin undoing economic and racial inequality, and figure out what kind of country America needs to be to face the foreign, domestic and environment challenges the rest of the 21^st Century will bring. Yes, elect Biden and then get on with it!

Premature Globalization

Globalization has come too early in humanity's history and gone too far. It is unsustainable with burdens and benefits distributed too unevenly to provide a basis for global stability. Globalization of the market has concentrated wealth in some places at the cost elsewhere of erratic consumer- and export-driven growth that distorts economic development and entrenches poverty. Free trade has meant cross-border transfers of jobs that have left many struggling to make ends meet in the “new economy” while helping others in low wage markets to enter the cycle. The resultant distortions have thus both concentrated and generalized inequality. Globalized media greatly magnifies the perception of inequality by delivering clear images of what is available elsewhere thus potentiating large-scale population movements. Globalization in the 21st Century benefits only some at the cost of the many who have been encouraged to believe that they too benefit from the increased availability of cheaper goods that they can't fix but must constantly buy anew. The majority of humanity still must struggle to attain or maintain a decent living for themselves and their families and a future offering hope for their children.

Within countries, those who directly benefit from the various facets of globalization face a rising tide of political opposition. In what may turn out to be a seminal offering, Peggy Noonan in a recent WSJ piece outlines an important distinction between what she calls the "protected" and the "unprotected." Taking this concept perhaps a little further than she would, the protected are those who make public policy or have purchased the people who do. Through their decisions and predominant political power, the protected impose mechanisms, processes and conditions that provide them direct benefit. The unprotected are those who must survive in the world that the protected make for them. The protected live the good life secure in their own communities. Because they are mostly insulated from any negative effects of their policies, they feel they can inflict anything on the rest. The unprotected live with none of these advantages and all of the fallout. Populist political movements from the left and the right have arisen in may places as the unprotected have lost their patience with traditional politics and politicians. In the US that includes Trump and Bernie Sanders, in Europe populist parties from France to Poland threatening or wresting political power from the “centrists.”

The root problem could be termed premature globalization. It might seem that the tying together of the world's economies might have been the result of some inevitable natural force. But the lowering of trade barriers and opening of borders has been the result of a myriad of political decisions by the protected. They have been able to move jobs to places with lower labor costs and to “import” – through legal and “illegal” migration – cheap labor to where they need it. Free trade always means that jobs move from one place to another. All those Chinese “lifted” out of poverty through years of high growth have come directly from jobs moved from America and elsewhere. The benefit to the unprotected – including the many in the developing world not able to compete with China or the West – has been slim and often fleeting. But as a friend has noted, free trade is only Pareto-optimal if the gains are broadly shared. The gains have not been broadly shared but the costs have.

Who benefits from free trade: the owners of capital and their public servants. They reap the profits and gain extra from buying favored treatment (openly or through corruption). Also, the local political elites of developing countries who monopolize power and skim off what comparatively little wealth trickles in from the global trade channels. Some from supplying raw materials (often mined or grown in ways wasteful and injurious to the environment and local populations), some from importing those planned-obsolescence consumer goods. (I freely admit to “benefitting” from the endless series of iPhones.) In America, they use their advantage to win favorable tax rates (or move operations elsewhere) while pushing to reduce “wasteful” government expenditure on things like infrastructure, healthcare or social welfare.

The primary role of government should be to ensure that all citizens can earn a basic living while helping them provide a suitable and nurturing environment for their children. This means the economy needs to provide a range of jobs from the highly skilled to the basic to mirror the natural mix of abilities and interests. Taking just the United States, over the last decades the Democrats and Republicans both have failed to meet this test. They have pushed the “benefits” of free trade at the cost of millions of jobs lost. Their mantra has been the benefits of those cheaper consumer goods and the possibility of newer jobs in the advanced economy. Even before the 2008 financial tsunami, those newer jobs were hard to find and most were lower pay.

When I was a lad in the 1950s and 60s, my parents raised five children on the salary of a truck driver plus the occasional factory employment of my mother. Try raising five children today on a working stiff's salary, even if both parents work. (How many political hacks rail against abortion but don't care a whit about how to pay for raising those children once they are born?) The protected also benefit from cheap imported labor, often forced to work off the books or as “contractors” without benefits. They do the jobs “Americans won't do.” Translation, they do the jobs Americans won't do at wages too low to allow a decent living.

Globalization would work well in a world of less pronounced inequality. But we have been pushed into it prematurely. The world of the 21st Century perhaps just does not produce enough wealth to share sufficiently for most people to have a decent life where they were born. Thus the wave of refugees – who come from the ranks of the unprotected whether because of conflict or poverty – overwhelming the gates of Europe or trying to somehow get through Mexico to the US. Maybe the only recourse is for societies that can afford to go it alone to raise the walls, close the doors and pull those jobs back to the homeland by ending free trade. Leave China to deal with its population without the benefit of those jobs imported from America. This is the appeal of the Trumps. It's hard to argue against and certainly the same old refrains from the protected – Democrats and Republicans – have lost their popular appeal. No matter who wins the American presidency or how hard Europe tries to prevent migrants from trying to cross, the unprotected are not likely to be denied forever.

Post-Iowa: No Real Winners Yet

Lots of ink being split and voices braying on what the Iowa primary results mean. My simple take is that Trump needs to win New Hampshire (NH) big or his patina of invincibility – remember he can shoot someone in the middle of NYC and not lose support? – will wash away. Without that, people will begin to consider more carefully what he actually says. Now, Trump is very smart. He might yet rise to the occasion but he will become a longer shot.

Rubio – billed by some as the “real winner” – is now target #1 of the remaining “moderate” candidates. (Rand Paul – the one Republican of principle – sadly dropped out today.) The “moderates” will try to tear Marco a new one to drag him back down. Rubio seems a lightweight but if he manages to hang on and do well in NH, he may suck the rest of the air from the not-so-crazy-as-Cruz side of the spectrum.

Cruz may think he can survive a loss in NH and go on into the South. Hillary may hope so because if Cruz can win votes there, she'll win more in November from the non-white-extremist majority down that way.

Hillary lost in Iowa despite her technical tenths of a percentage point “win.” She has issues, including apparently the fact that she earns few points for transparency. Once, when I worked in the White House, she served me tea as I was accompanying the visit of the First Lady of Argentina upstairs in the private quarters. Mrs. Clinton was very gracious to include me as if I was also a guest.

I admit to liking Bernie because of his razor-sharp focus on inequality, our number one problem (globally as well as in America). Some say that since Bernie – a “socialist” – cannot possibly win in America, a vote for him is wasted. But if he wins in NH, he just may get enough wind in his sails – and votes from the under-45 – to make it a long race.

Now Jeb, and I won't say poor Jeb. I personally believe he was the Bush – if we had to have one – we should have gotten in 2000. But that is a low bar. He apparently has received too much money to simply bow out just because it's clear he has bombed out. If you walk away from the $150 million plus he's been given, the investors will not be pleased. Bush may hope that Rubio stumbles in NH and he gets a second look. So he may actually have to crash and burn before dropping out. Better for all if this happens in New Hampshire.

Obama's Watershed Victory

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President Barack Hussein Obama made history for the second time on November 6, 2012. The first time, in 2008, he became the first non-white to win the American Presidency. But that was mostly due to the appalling situation that George W. Bush had created – endless war and economic catastrophe – and the eagerness of the American public to change course. This time Obama won election on his own, by putting together the first winning coalition built upon the tremendous diversity of American society. Romney won the white vote. But Obama won the vote of blacks, hispanics, women, gays and the young, and of big city/suburban dwellers and the “47%” that Romney mistakenly wrote off early in the campaign.

Clearly, many Obama supporters were also white, just not the older, rural, male and richer ones that were the core of Romney's support. Obama won the election because he gained the votes of the diverse, urban America of the 21st Century. He did so because he is clearly in tune with that diversity and because of a sophisticated (and unfortunately expensive) political machine that was able to target and enthuse the many and varied slices of our social, economic, cultural and regional complexity.

The Republican Party clearly understands none of this. Instead of seeking to embrace this emergent diversity, the Republicans made war on it by targeting the black man elected in 2008. Unspoken racial fears still present in much of that section of the white electorate that remains solidly Republican allowed the small government, no-tax-increase fundamentalists to appear to have a solid political base. The rich, white “one-per-centers” making up the Republican elite of office holders and donors sought to build upon this by frightening just enough additional voters to unseat the President they sought to demonize with charges he would make the US into “Greece.” It turned out that this was not enough to win over all those real people with real concerns and hopes not addressed in such simple terms.

The Republicans instead should have sought to seize at least some of the new ground before it became more solidified for the Democrats. In a way, they were fortunate to have finally settled on Mitt Romney – former governor of Massachusetts, a northeastern “blue” state – as their candidate. After his nomination, the ever-mutable Romney could have used his fabled “etch-a-sketch” to begin redefining his party in the more moderate direction it needs to go to remain competitive. Romney is a rich man but Americans don't automatically hold that against anyone. Rich Republicans used to remember that the economic system that made them rich and keeps them rich doesn't, by itself, ensure the fairness and equal opportunity that alone produces majority support for that system. The Republicans needed to find an updated version of someone like Nelson Rockefeller, a true moderate who could project compassion and understanding of the social compact necessary to sustain democracy and yet also be rich.

Romney could have become the new and improved Rockefeller. This would have meant resisting currents that have been building since Goldwater and that eventually undid the moderate wing of the Republican party. Difficult, but a start could have been made, especially running with the incumbent facing strong economic headwinds. Instead, Romney chose to play it safe and instead solidify his (white) base by choosing to move to the extreme right and to pick as his running mate a poster boy for Republican fundamentalism. If Romney had moved earlier and more consistently toward the center, the Republican base would have had nowhere else to go. It still really, really wanted to get rid of Obama. Other Republican leaders could have fallen in line in the interest of winning this and future elections. But none of this happened. Romney's lack of political courage and his choice to run to his “base” led to his defeat and that of the party that jumped with him into the demographic wilderness.

Shed no tears for the Republicans. They have sought since 2008 to lie, bully and scare their way back into power without offering anything beyond fears about debt and big government. Twenty-First Century America is too large, diverse and complex to be governed with a simple no-new-taxes, small government catechism.

President Obama and the Democrats don't have have all the answers either and did not offer any new, big vision in this campaign. But Obama seems to understand that while government cannot and should not try to do everything, it must be a major part of the effort to manage our complexity. Government must help keep our society within the bounds of fairness and justice by providing our free-market economy the political structure (and infrastructure) necessary to empower it to continue to fuel our American way of life for all Americans.

America is waiting for a message of some sort or another

Americans of all political persuasions apparently are disappointed with our dysfunctional government. We want most of what government does for us – even in health care – but it seems that the system is broken. It feels like our leaders, parties and the way our government works just may not be up to the challenges we face in this 21st Century. Yes, Washington seems sunk in partisan bickering and knee-jerk attacks on whoever tries to do anything. But the very mechanism – designed in the 18th Century and last updated 100 years ago – seems woefully incapable of helping us make and implement the decisions we need to survive and prosper in the bewilderingly complex world we now find ourselves in. The Senate has become an arena for power politics fueled by all the influence that money can buy. The federal government – and most of the states – are spending more money than we have. Fortunately, the Chinese have little choice but to hold our dollars for us. But the debt we have run up measures a collective addiction greater than the most pernicious drugs. The Presidency is enmeshed in a bureaucracy of vested interests – within the government and within the ruling party. We seem to have entered the age of permanent war in which only the professionals fight and die. The whole system has become the tail on the dog of the military-industrial complex that Dwight Eisenhower warned us about.

We need to update how we do business, bring the constitution into this millennium. Whether by constitutional convention or through amendments, we need to seize back the initiative. The Founding Fathers were great men for their time, we need great men and women now for our time. Change in America is usually incremental. Our political system's great strength is our reliance on stable and solid rules of the game. But we need change; we all recognize this. Some may fear it. Certainly some may worry about opening the Pandora's Box as widely as a constitutional convention might. But we really cannot go on this way much longer and still maintain our leadership in the world and offer our children and grandchildren a return to the American dream that we boomers have let slip from our grasp. We need the sort of grand national conversation that a convention would bring on. Being democrats, sharing a belief of government of the people, by the people and for the people, we should have nothing to fear but fear itself.

Perhaps our national dialogue can be channeled through serious consideration by the Congress and then through state ratification of amendments we might agree on? Or maybe the Tea Party has accurately measured the times and we need something from outside the existing structures. Article Five of the US Constitution provides the various alternatives.

What might we need to change? Perhaps a parliamentary system might be best. Parliamentary government is more agile, allowing majorities to rule yet quickly recallable. But we Americans do like our change in small steps. So a couple of more modest suggestions:

To improve the efficiency and representativeness of our national legislature.

- Increase the term of office for Representatives from two to four years so they can spend more time focusing on legislating rather than running. Stagger the terms so that every two years, half the House is up for election.

- Increase the representative and deliberative nature of the Senate. Change the distribution of the Senate seats so that no state can have more Senators than it has Representatives. Distribute the extra seats to states according to population with no state having more than three. This would mean that states would have 1-3 senators roughly distributed every ten years according to the latest census. All senate terms would be concurrent and for five years timed to be open the year following the census.

To improve the efficiency and representativeness of the administration of government.

- Increase the presidential term to six years while retaining the limit of two terms.

- Mandate constitutionally that the federal government operate on a two-year budget.

To build into government and law some regular process of review that includes popular consideration.

- Mandate that all Acts of Congress be reauthorized every 25 years either by a 3/5's vote in each house or failing such action, by national referendum.

- This would apply as well to all departments and agencies of the federal government not explicitly named in the Constitution.

Change is the order of life. We Americans have lived in a political system resistant to change. That is mostly good. But the time has come to dig up the roots, prune the tree and replant in soil we can grow on. Let's talk....

Life in America

We can divide daily existence into three modes: 1. the time we spend directly and immediately immersed in the world in some specific activity such as working, fishing, driving, planting, reaping, rowing, watching TV, whatever; 2. the "personal" time we spend in reflection, self-observation, thought, or just plain mindlessness; 3. the time we spend with others, in social interaction of all sorts. Often we are in all three modes at once, like talking to a fellow worker while running the forklift or losing ourselves through hours of flipping through the TV stations with a friend.

Life in modern America provides a neutral context for our existence; neutral in the sense that the space exists for whatever we need or choose to do. The activities we pursue are constrained by what it is we physically do as work and to make our way through the day and by what is available to us. But our activities are slotted into our existence pretty much free of taboos, traditions, history and culture. The biggest determining factor here is our personal wealth (which offers lesser or greater variety of needful and possible activities) and the current technology. Our leisure time -- for example -- is now often watching TV. Before TV, we passed our mindless leisure time in other ways, though there was probably less of it because with increasing modernity, we have in general gained more leisure time, as well as more ways to use it. Indeed, what we DO is subject to constant change as a result of “progress.” We work with and entertain ourselves through an ever-expanding number of technologies and devices. Yet, and here finally is my point, while what we DO can look pretty "modern" -- because what we do it with is “cutting edge” -- the neutral context in which we live allows us to continue to live in a variety of traditional and self enclosed environments when we are in our personal and social modes. That is to say, we may drive cars, watch DVDs, and play video games but we still live within an assemblage of patterned existences that goes straight back to the medieval life of town and country. Many of us are still peasants.