Entitlement Reform

Republicans rant endlessly about so-called “entitlement programs” as though they are evil theft from the treasury, while Democrats rise up in anger bearing torches and cudgels whenever the slightest economies are suggested for them. Well, that’s an exaggeration of course, but it does capture the essence of the sorry situation we are in. I believe both are sadly wrong and, if given their way, both will do irreparable damage to our economy. On this topic, as others, we need to be sensible, compassionate and frugal, and we need to listen carefully to those with whom we disagree. When did this ever describe the swamp dwellers in Washington?

That is just one-man’s opinion. Take it for what you will. But the point of this blog post is to relate a piece of oft-forgotten history involving what we now call entitlements. It is relevant to our times because it provides an important message for a possible way out of this mess.

Do you know what the greatest single reduction of entitlements in our history was, and who did it? The answer to the second part of this question surely should be a surprise. It is Franklin Delano Roosevelt, who is the originating force behind many of today’s social welfare programs. In 1932, he had campaigned on the promise to bring federal finances into better order at a time when they were in total disarray and many despaired for the nation’s future. At that time, veterans’ benefits took up fully 25% of the federal budget! A grateful nation had bestowed far more than they could afford on returning soldiers of WWI and even earlier on those from the Spanish-American War.

Almost immediately after taking office on March 4, 1933, FDR submitted a proposal that would slash the federal budget. It would eliminate several government agencies, reduce the pay of civilian and military federal workers and, most significantly, slash veterans’ benefits by 50%. The Congress acted swiftly, even in the face of stiff opposition, and passed this virtually intact as the Economy Act of March 20, 1933. In the event, the impact of this bill was not as great as had been hoped. The effect on the deficit was minimal, perhaps due to other influences and general inertia in the economy. And some of the veterans’ benefits were later restored by two Supreme Court decisions.

But that is beside the point, which is that entitlement reform is possible but, in my opinion, only if Democrats do it. But when was the last time you heard any Democratic leader propose entitlement reform as a party platform plank? They always proclaim that they are open to reasonable changes, but they do so with obvious reluctance and never on their own accord. Hence their response to any Republican plan is fear and loathing, together with loud complaints about doom for all but the fat cats.

Still, I remain an optimist. Some day a Democratic leader will arise with the good sense and guts to do what is necessary. It has happened before. I just hope it is soon enough.

Advertisements

Are Democrats Washed Up?

Check this map. Do you see what Democrats should fear? Yes, it is global warming! If ocean levels rise as much as some fear in the coming decades, the most highly populated blue regions will be inundated or washed away. And there are scant few blue districts as it is.

As this graphic illustrates, the losses will be from the most progressive areas. I am not implying that this in itself means fewer progressive voters, but we have seen from the last election how much household adversity impacts voting trends. Heretofore reliable Democratic voters abandon their allegiances when vital interests are at stake. Talking about free college and receptive borders won’t hack it with those pushed away from their homes and jobs.

Of course there is the possibility that dispersion of progressives into the red interior might change the region’s political character, so take heart those of you on the left! Hippies in Kansas?

Ok, I assume you realize that the preceding is satire. However the basis is real and I can’t resist taking this opportunity to comment seriously on this looming threat.

I wouldn’t want to leave the impression that I believe Democrats are expressing alarm about global warming because of simple self-interest. All thinking citizens worldwide are justifiably concerned. This threat is real and the scientific consensus is incontrovertible. As a scientist who has actually worked professionally in the fields of meteorology and geophysics, I feel safe in making this assertion.

Many conservative doubters, however, have suspicious motives and a weak grasp of and little respect for science. They simply don’t like the consequences of having to face this threat head on. Oh sure, they can no doubt find a few reputable scientists who quibble about the role human activity is playing in global warming. I’ll bet I could find credentialed scientists who think the world began about 6000 years ago and that the Moon landing by Armstrong and Aldrin was a gigantic hoax. Scientists can be as ditzy as anyone else, but consensus rules the day, thank God.

Regardless, it really doesn’t matter what is causing this calamity or whether human activity is crucial, unless of course you believe that we can significantly prevent the worst from happening. Personally I doubt that our feeble efforts to mitigate human impacts will make much difference and are likely a waste of time and resources. Rather, we must strive urgently to live with the inevitable impacts and to protect ourselves where possible. It is simply a matter of where we get the best bang for the buck.

A good test case is in progress as we attempt to recover from the recent weather disasters in Texas, Florida and the Caribbean. If we simply rebuild and re-establish communities as they were before, we will have failed the test.

The Border Wall Mystery

With respect to the proposed wall on our southern border, I think I have it right that Democrats oppose it — vehemently — and Republicans, by and large, favor it. I understand the Republican position. They seem convinced that it will help solve our illegal immigration problem. But barring building a Berlin-type barrier with electrified fences, mines and machine guns, I frankly doubt this. A complete wall built according to current proposals will likely have some effect, but people will find a way across our border if the economic incentive is sufficient.

However I am a bit puzzled by the Democratic opposition. I searched the internet and none of their spokesmen make a clear and unambiguous statement about this. I would have thought that wasting all that money that could be put to better use would be an obvious reason, but they never seem willing to put it quite that baldly. Still, I assume that this is basically their position — and mine, too.

But here’s the problem. Both of the top Democratic leaders, Sen. Chuck Schumer and Representative Nancy Pelosi, have stated in clear terms that, if funding the wall is included in a bill to raise the debt ceiling, Democrats will vote to block it. This situation will likely arise in December. They are fully aware that Democratic votes plus those of the extreme right in the Republican caucus will prevail. In other words, they are willing to sabotage the nation’s credit, drop a bomb on our economy, and risk significantly increased interest rates rather than wasting some money on the wall. On its face that doesn’t make economic sense. In fact, it defies logic unless there is something more at stake than wasting a few billions. So, what exactly is the real issue? And is it really worth that much?

Knowing Democrats, my theory is that this isn’t a money issue at all, or at least not in its essence. There is something about building a barrier on our border that strikes at the very core of progressive ideology. To many Democrats, it’s a bit like tearing down the Statue of Liberty, perhaps combined with making English our national language. The wall has become a symbol of exclusionary philosophy that is anathema to old-style Democrats. So perhaps they would indeed risk an economic catastrophe rather than conceding this point.

Of course, this is just a theory. But if it is true, then Democrats are about as nutty as Republicans, which is a standard that is rather hard to meet.

The Democrats in 2020

I make no secret of the fact that I am no fan of either major political party. But every now and again I like to put on one of their hats and offer my perspective about what they should do to achieve success. This time the Democratic Party is the honoree.

There is much discussion about who will assume leadership of the party, which – let’s be honest – is in shambles across the country. People keep mentioning the old standards, Joe Biden, Elizabeth Warren, Bernie Sanders and Jerry Brown. There are even whispers of a Hillary Clinton reemergence. “Old” is the operative term.

Meanwhile there are occasional boomlets for young leaders who have yet to make a national impact, like Julian Castro, Tulsi Gabbard, Eric Garcetti, and Kirsten Gillibrand. The common belief that the party has a weak bench is wrong. There is no dearth of young talent, but no one has exhibited that special essence that makes a viable national candidate.

However, one aspect of this search seems to have been mostly ignored. By far the largest identifiable segment of the Democratic base is black women. This group is large, influential and reliable. It seems to me that it makes sense either to choose someone from that group or, if no qualified candidates stand out, then at least someone who particularly appeals to it on a gut level. That should be the first criterion.

So, here’s my suggestion: Sen. Kamala Harris. Yes, I know, she is just a first-term senator but I have a one-word response to that criticism: Obama. She is smart, accomplished, and a great public speaker. In California she has demonstrated that she can draw votes from a broad spectrum of voters. I say go for the touchdown, don’t just try to squeak out small gains.

Trying to bridge the broadest range of voter support with a candidate beloved by no one has been tried and it failed. Trump showed the path. Find your core and stick to it with vim and vigor. Don’t worry about fringe supporters. They have nowhere else to go and just the horror of the Republican opponent will drive them to the polls. Going for a geriatric standby is comfortable but that road has a dead end [pun intended]. Moreover, forget about that unicorn, the uncommitted centrist. Most people who claim to be in that group are either self-deluded or outright liars.

One counter argument, largely presented by the Biden wing, is that Democrats must return to their roots and appeal to disgruntled white working-class voters who deserted them in droves in 2016. But think about it. If an elite NY billionaire with funny hair can achieve this rapport, why can’t an attractive young California legislator, even if she is a black woman? In this case, the key is the message, not the messenger.

Democratic Navel Gazing

middleamericaDemocrats are justifiably reassessing their message to middle America. Losing Wisconsin, Michigan and Pennsylvania is a wake-up call. Few believe that Democrats can remain a national political force operating mainly from the North-East, the West Coast and a smattering of great cities scattered across the land. I just watched an interview of two aging Democratic heavyweights, Hilary Rosen and Bill Press, and I was amused at how clueless they are. Like Hillary Clinton’s ill-fated campaign, they profess to look forward while actually thinking mostly of triumphs from the distant past.

Their assessment is that the recent campaign concentrated too much on social issues and character assassination of Trump and too little on bedrock economic issues. That is likely true, but then they proceeded to demonstrate that they are the problem not the solution. For example, Press noted that Democrats have always had the back of working class America, citing the many great programs that they have created and supported over the years. Thus, he mused, the problem must be how they get their message across. He cited as principal examples their promotion of a $15 minimum wage and their fervent support of unions.

But the uncomfortable fact is that many – perhaps most – in the working class don’t much like either of these! They see the minimum wage as just a sop for others, the poor and marginal workers. The only impact they foresee for themselves is job insecurity as businesses have to adjust operations to meet a general upward wage pressure. A rise in wages that results from increased business activity and a tightening labor market is welcome and has few adverse consequences. One that is simply mandated is quite the opposite, except for those who are its direct beneficiary. And that is not the majority of working class America.

As to unions, they currently have a very mixed reputation. Unions once did marvelous things for workers in general and we all have profited from their efforts. But that is long past. Unionization is now low and decreasing. It is strongest in the public sector, but that is a mixed blessing for union promoters as few outsiders think highly of government workers.

A key factor in the low reputation of unions is a growing recognition that many of them basically ran a scam on their members. Their leaders colluded with management, particularly in the public sector, to trade wage increases for lavish fringe benefits, like retirement packages with golden health plans. This was attractive to the short-term perspectives of management because the costs don’t show up as operating expenses. Rather they contribute to out-year costs when, presumably, many managers will be comfortably retired. For the union leaders this also is attractive as the negotiations are far easier and their outcomes, if future benefits are amortized, appear very lucrative. The problem is that these agreements imposed impossible debts that are now coming home to roost. Wages have stagnated and the promised fringe benefits are in jeopardy.

socialismWhy should those who work with their hands back a party that promotes pie-in-the-sky social schemes, transgender bathroom rights, sanctuary cities, a globalized economic policy, immigrant rights, and a long litany of causes that are remote or counterproductive to people who sweat for a living and struggle to raise a family? Joe Biden is right. Democrats need to return to their origins. It’s fine to work for the poor, the disadvantaged and the downtrodden. It shows their heart and good intentions. But their main message must be to those who have jobs and work for a weekly paycheck. Otherwise they will become the party of the marginalized, essentially a Bernie-style Socialist Party. Even a blowhard like Donald Trump can defeat that.

Watch who is selected as the new Democratic National Committee chairperson. Just as picking Debbie Wasserman Schultz signaled a grey, technocratic and backward-looking future, this will show what path they are choosing for the next political contest. If it is Rep. Keith Ellison, as is widely rumored, the party is likely toast for the foreseeable future.

What now for Democrats?

As I have often remarked, I hold no allegiance to either of our two venerable political parties. Indeed, at the risk of insulting my readers, I confess that I consider true-believers of either ideology to be happily deluded at best and sadly demented at worst. Both parties have ideas worth considering and certitudes that are simply nonsense on their face. With this background in mind, here are a few of my thoughts about the situation that the Democrats now face after their recent electoral defeat.

3a31e9ba00000578-3918258-supporters

First, here are few statistics to ponder. It is no surprise that Democrats are despondent.

  • Republicans will shortly control the Presidency and both Houses of Congress.
  • They will likely also dominate the Supreme Court after the Scalia vacancy is filled.
  • Of the 99 state legislatures, 69 are totally controlled by Republicans.
  • In 24 states, Republicans control both the State House and the legislatures.
  • Only 6 states have Democratic Governors and legislatures.
  • There are 34 Republican Governors, providing a full bench for future Presidential candidates.
  • Fully one-third of the House Democratic caucus comes from just 3 states: MA, CA & NY.
  • Of the almost 700 counties that Obama won twice, Trump won 209 of them.
  • Of the counties that never voted for Obama, Hillary won only 6.

Basically, contrary to popular opinion, we are not a divided nation except in the sense of an Athenian democracy, which of course is not our form of government. We could take all Democratic voters and stuff them into California and never again have full Democratic control of our federal government!

I won’t list the comparable situation when Obama took office in 2008, but suffice to say that the years of his leadership have been an unmitigated disaster for his party from the perspective of political power. Not that he didn’t have some policy successes, but evidently the electorate gave him and his party scant credit. The President of course doesn’t directly influence what happens in elections at the state level. But he sets the tone and his successes or failures trickle down to a significant degree.

To be fair, Republicans did everything in their power both to see that he failed and that he was seen as a failure. His successes are thus all the more remarkable in the face of their intransigence. Still, compare his tenure with that of Bill Clinton, who faced at least as clever and relentless political opposition while presiding over the most successful Democratic regime in the modern era. And all of this was in spite of the indignity of almost being impeached.

The Democratic Party will recover and once again become a vibrant political force across the land. Early reports of fracture or even demise are overwrought and are comparable to what is usually said after painful defeats of either party. For example, the Goldwater cataclysm in 1964 was supposed to be the end of the Republican Party. However, the near victory by Hillary Clinton this time is misleading. She had the weakest opponent since the Democrats threw up Walter Mondale or Michael Dukakis. I think Joe Biden would have won handily even though he would be fighting the tide of a change election.

How long this recovery takes depends on how quickly Democratic movers and shakers come to grips with what is wrong and why. It is too soon after this election to even begin this process. In addition, the poison fruits of a generation of neglect of “flyover America” will threaten any renaissance. The 2020 census is not that far off and the mass of Republican legislatures and Governors will no doubt continue their re-apportionment gerrymandering.

My two cents worth is that depending on big city juggernauts and the growth of the Hispanic population will not work. The latter group is far more diverse in outlook and interests than is popularly appreciated. Democrats have to listen to old hands like Joe Biden and reconnect with their old base among the less-educated middle class, both white and black. These are not just “po’ white trash” as the Democratic intelligentsia sometimes appear to believe. Relying on the poor and the well-to-do intellectual class is not a viable long-term solution because they are geographically concentrated in ways that don’t work on our electoral map. Bernie Sanders had it right is some ways, but he was a flawed spokesman for that viewpoint.

Another critical flaw in the recent approach by Democrats is laying a big bet on income inequality as a political wedge. The problem is that, even for many of the poor, “coveting their neighbor’s ass” has never been much of a motivator for most Americans. People want a piece of the action but not necessarily by redistributing wealth. Indeed they often admire great success unless it is clearly undeserved; they just want a fair shot at achieving it themselves. Unsurprisingly, the big proponents for income redistribution are well-off intellectuals who, I presume, expect that “it won’t effect thee or me, but instead that guy behind the tree.

To end on a bright note for those of you who voted for Hillary, there is an excellent chance that Republicans under the leadership of Donald Trump will step in the big do-do. The announcement yesterday that Steve Bannon, of Alt-Right infamy, will be Chief Strategist for the new administration is a time-bomb waiting to explode. If the nation survives this, as I am quite confident it will, we will be well-positioned for a return to sane, progressive leadership if the Democrats can find their way to offer it in 2020.