Saturday, April 22, 2017

Paradigm Shifts

Since my post referencing Jung was thoroughly trashed and then ignored, here is one that Jerry (and Stuart?) won't be able to resist.  (Jim's in Bali so he's off the hook this time.)  I ran across this in a discussion of the sorry state of conventional economic wisdom.

Three before their time: neuroscientists whose ideas were ignored by their contemporaries

I discuss three examples of neuroscientists whose ideas were ignored by their contemporaries but were accepted as major insights decades or even centuries later. 
  1. The first is Emanuel Swedenborg (1688–1772) whose ideas on the functions of the cerebral cortex were amazingly prescient. 
  2. The second is Claude Bernard (1813–1878) whose maxim that the constancy of the internal environment is the condition for the free life was not understood for about 50 years when it came to dominate the development of modern physiology. 
  3. The third is Joseph Altman (1925–) who overturned the traditional dogma that no new neurons are made in the adult mammalian brain and was vindicated several decades later.
Here's a good article if anyone wants to see how a similar situation is playing out in economics:  
MMT is what is, not what might be (warning, it's rather long).  Here's a relatively brief excerpt describing the general phenomenon of scientific revolutions:

Academic disciplines (such as, neurobiologists, archaeology, economists etc.) work within organised ‘paradigms’, which philosopher Thomas Kuhn identified in his 1962 book – The Structure of Scientific Revolutions – as “universally recognized scientific achievements that, for a time, provide model problems and solutions for a community of practitioners”...
Rather, Kuhn said that dominant viewpoints persist until they are confronted with insurmountable anomalies, whereupon a revolution (paradigm shift) occurs. The new paradigm exposes the old theories as inapplicable, introduces new concepts, asks new questions and provides students with a new way of thinking with a new language and explanatory metaphors...
The work of Joseph Altman, Jacques Cinq-Mars, Barry Marshall and countless others across all discplines represented the potential for a paradigm shift and was resisted by the mob until change became ineluctable.
Not all novel ideas face this sort of brick wall. But when the professional bodies become trapped by Groupthink and, typically, there is status and money at stake (particularly, commercial edge) then resistance can be fierce and prolonged...
The following discusses the above with respect to economics, so you can ignore it if you've had enough (c:

The point to understand is that MMT is a system of thought that allows us to understand how a fiat currency monetary system operates and the central role that government can play in a modern monetary economy...
What is mostly ignored in mainstream economic commentary is that in August 1971, the monetary system agreed at the famous Bretton Woods conference in July 1944, which required the central banks of participating nations to maintain their currencies at agreed fixed rates against the US dollar, collapsed.
The system proved unworkable and when President Nixon abandoned the convertibility of the US dollar into gold, most nations moved to a fiat currency system...
Different nations (or blocs of nations) structure and use the capacity possessed by a fiat currency in different ways. The Eurozone Member States voluntarily ceded the capacity to Frankfurt and then imposed harsh rules on themselves with respect to net spending.
Other nations have evolved differently.
But the point is that every day, across every nation, monetary systems are in place that operate along the lines described and explained by MMT...
MMT, as a new powerful lens, makes things that are obscured by neo-liberal narratives more transparent.
It means that the series of interlinked myths that are advanced by conservative forces to distract us from understanding causality and consequence in policy-making and non-government sector decision-making are exposed.
There is much similarity with traditional religion, as I see it.

Friday, April 14, 2017

Regional Inequality and the Election of Trump

The election of Trump is part of an international reaction to neo-liberal economics.  Looking at the phenomenon more closely, we can see that increasing regional disparities caused by the decline of U.S. government anti-trust enforcement are a major component of the overall reaction.

Eliminating anti-trust has been good for profits of major American corporations.  The co-option  (co-opting) of the middle class through the ownership society and increasing participation in the profits of large corporations has no doubt been a major factor.  No doubt there have also been some beneficial effects for consumers.

The effects of neo-liberalism on regional economic equality are less well appreciated.  Thus, many of the owners of regional corporations are unhappy and have called for ever less federal government intrusion into the economy.  Ironically, however, these regional corporations are under attack from larger national and multi-national corporations, and lack the protection formerly provided by anti-trust laws.

Thus, Trump rode regional dissatisfaction to the presidency, boosted by anti-government business leaders in flyover country.  Their businesses, however, are not under attack from the government, but from global behemoths such as Amazon.com, Bank of America, or United Airlines.  Their irrational belief that too much government is responsible for the increasing regional disparities is manifest in the profoundly confused Republican economic platform.  Voters in flyover country know something is amiss with their local economies, but their leaders (Republican and Democrat) aren't giving them a reasonable explanation.  They've turned in the exact opposite direction of where they need to go.

These thoughts of mine are still half-baked.  For a more coherent discussion, please see Regional inequality is out of control. Here’s how to reverse it, by Phillip Longman (from 2015 -- i.e. written before Trump rose to prominence).  Here's the concluding paragraph of Longman's article:
Inequality, an issue politicians talked about hesitantly, if at all, a decade ago, is now a central focus of candidates in both parties. The terms of the debate, however, are about individuals and classes: the elite versus the middle, the 1 percent versus the 99 percent. That’s fair enough. But the language we currently use to describe inequality doesn’t capture the way it is manifest geographically. Growing inequality between and among regions and metro areas is obvious to all of us. But it is almost completely absent from the current political conversation. This absence would have been unfathomable to earlier generations of Americans; for most of this country’s history, equalizing opportunity among different parts of the country was at the center of politics. The resulting policies led to the greatest mass prosperity in human history. Yet somehow, about thirty years ago, we forgot our history.

Thursday, March 23, 2017

Dealing with the Trump Phenomenon

I've run across a number of excellent discussions of the Trump phenomenon and how to deal with it:
Together, these articles form a coherent narrative and way forward.  I'll provide short summaries of each to illustrate.

Is Economic Despair What's Killing Middle-Aged White Americans?, by Alana Semuels

Ms. Samuels discusses the declining fortune of white, working class Americans.  Her approach is descriptive, not political.  I'm tempted to quote at length from this article, because it's power is in the accumulation of credible academic surveys and evidence that the economic and sociological problems of the white, working class Americans are real and significant.  But you can see the evidence yourself at the link, so I'll just highlight here what I see as an important observation:
in a new paper, economists Case and Deaton explore why this demographic is so unhealthy. They conclude it has something to do with a lifetime of eroding economic opportunities.  Case and Deaton see a large uptick in deaths from suicides, poisonings, and alcoholic liver disease among whites with lowest levels of educational attainment... They divorce or have trouble finding a marriage partner because of their poor economic prospects...  low income and low job opportunities, after a long period of time, tears at the social fabric  
This is in contrast to Europe, where people of all educational backgrounds are living longer... Case and Deaton theorize that this trend is not happening in Europe because of the social safety net there. 

Ms. Williams is empathetic.  She points out the problems faced by the white working class, and the reasons they have been resistant to reason from the liberals' perspective.  She provides five guidelines for dealing with the predicament that is the white working class in the U.S.
  1. Understand That Working Class Means Middle Class, Not Poor
  2. Understand Working-Class Resentment of the Poor
  3. Understand How Class Divisions Have Translated into Geography
  4. If You Want to Connect with White Working-Class Voters, Place Economics at the Center
  5. Avoid the Temptation to Write Off Blue-Collar Resentment as Racism

Frank Rich, in my opinion, reacts poorly to the Trump phenomenon.  His conclusion is to let Trump voters live with their decisions.  Liberal empathy and argumentation isn't likely to change the minds of Trump voters, and we just risk compromising our values, as well as wasting our time and energy, if we indulge these spoiled brats.  Here are a couple of quotes:
The notion that they can be won over by some sort of new New Deal — “domestic programs that would benefit everyone (like national health insurance),” as Mark Lilla puts it — is wishful thinking
 Perhaps it’s a smarter idea to just let the GOP own these intractable voters. Liberals looking for a way to empathize with conservatives should endorse the core conservative belief in the importance of personal responsibility.

First of all, I think he's wrong about the impact of "some sort of New Deal".  

Secondly, I don't think it's smart to just ignore the voters in the areas where Trump is popular.  Rich may be right that many of these voters are intractable, but many others may not be.  

Rich presents a false dichotomy:
Listen and be Empathetic OR Be Resolute in our Liberal Convictions

Of course we can do both.

Thus we should propose domestic programs that would benefit everyone (like national health insurance) because we believe these will be good for our country, including our suffering citizens in areas that voted for Trump.  Personal responsibility should not be conflated with guilt by class or place of residence.

Politically, Sun Tzu had a point when he said, in The Art of War
If you know the enemy and know yourself, you need not fear the result of a hundred battles.

Listening, being empathetic, and proposing more programs to solve working class problems in rural, rust belt, and even southern areas is the strategic, as well as moral, imperative.  

Dale Beran takes the above discussion one step further by comparing a Trump voter to a child having a tantrum.  I'm a firm believer in letting a child work through his or her tantrum.  There's no point in trying to reason with someone who is trying to gain attention by being unreasonable.  On the other hand, it would be foolish to ignore the conditions underlying the tantrum.  The correct response is to ignore the nonsense and deal with the underlying issues.

With regard to Trump voters, that means we don't ignore the real issues.  Does that mean we run the risk of wasting our time trying to reason with the unreasonable?  That is something we can control, to a large extent.  We can minimize the impact of the nonsense by treating it as such, without dismissing whole groups of people or regions of the country.  

Rich suggests that we "hold the empathy and hold on to the anger".  I agree that we should hold on to the anger, as that gives us energy to maintain our focus.  But that is only half the battle.  The other half is having a plan to succeed in dealing with the very real problems of the working class in the U.S.

Saturday, March 04, 2017

Neo-Liberalism Revisited

A contentious debate has erupted amongst Democrats regarding the term neo-liberal.

Leftists (such as myself) use the term derisively to indicate that the Democratic party has become Republican-lite.  The Dems, according to this view, compromised too much since the time of the Reagan Revolution. Bill Clinton ended welfare as we know it and declared the era of big government over.  The power base of the Dems shifted from unions to Wall Street, Silicon Valley, and Hollywood.

Centrists argue that there is still significant space between the Democrats and Republicans.  Democrats still believe in Keynesian economics, and the role of government to regulate the economy, and stimulate the economy in times of recession.

In discussing these views, I was recently informed of an essay by Charles Pierce from 1982, entitled A Neo-Liberal's Manifesto.  I think it captures the essence of neo-liberalism, as neither a totally positive nor totally negative phenomenon.  It was well-intentioned, but not successful as the Republicans got what they wanted in terms of more unbridled capitalism, but surrendered nothing with regard to the economy.

In reviewing Pierce's analysis, the one thing that stands out to me (naturally, given my economic world view) is his "seriousness" regarding government finances:
Another way in which the practical and the idealistic merge in neo-liberal thinking is in our attitude toward income maintenance programs like Social Security, welfare, veterans' pensions, and unemployment compensation. We want to eliminate duplication and apply a means test to these programs. They would all become one insurance program against need.
As a practical matter, the country can't afford to spend money on people who don't need it... as liberal idealists, we don't think the well-off should be getting money from these programs anyway -- every cent we can afford should go to helping those in real need... We are, after all, determined to be practical, not to be the kind of liberal who spends without regard to income.
Politically, this turned out to be a disastrous approach.
  1. The Republicans gave only lip service to the deficit, while Dems were more fiscally responsible.  The effect was that Dems provided less stimulus than the Republicans with their multiple tax cuts.
  2. By means testing government programs, the Dems lost much of the middle class.  "Every cent we can afford should go to helping those in real need" may have been a noble idea, but practically it was not necessary, raised legitimate questions regarding incentives, and led to unnecessarily complex programs such as "ObamaCare".
I still like the Pierce's idea of neo-liberalism for the most part, but the emphasis on fiscal prudence at the expense of broad government programs (helping the middle class as well as the poor) should be changed.

A few additonal of Pierce's neo-liberal thoughts that have not fared well based upon the test of time:
Our hero is the risk-taking entrepreneur who creates new jobs and better products. "Americans," says Bradley, "have to begin to treat risk more as an opportunity and not as a threat."
My observation:  Entrepreneurial "heroes" have too often poisoned our society, whether it be the literal poisons of the fossil fuel folks (e.g. Koch brothers) or the financial poison that has come to dominate our economy.

Note also how poorly many of the cited 1982 neo-liberals have fared.  The Democratic politicians uniformly fared poorly and had little impact on the political landscape (Hart, Babbit, Tsongas, Bradley), while several of the journalists seem to have lost their way  (Kaus, Kinsley).  Charley Pierce himself seemed to devolve into something of a ranting crank.  Of all those mentioned, only James Fallows has my admiration.

Saturday, February 04, 2017

Don't be Frozen Like a Deer in the Headlights -- Embrace Socialism

From my perspective, the world is spinning out of control.  I went to read my favorite blogs today, and all was gloom, doom, and, above all, disdain for others.

In desperation, I turned to Steve Randy Waldmann www.interfluidity.com, and was not disappointed.  Steve without fail writes thoughtful and constructive posts, without gratuitous name calling.  His post today commented on Ezra Klein's gloomy discussion of political polarization in the U.S.  Ezra concluded his post as follows:
Polarization is going to get a lot worse before it starts getting better.
Waldmann points out some fundamentals of our political system that underlie the increasing polarization noted by Klein,  Professional politicians emphasize issues which differentiate the parties, while downplaying potential wedge issues such as immigration and trade.  Eventually, a politician like Trump comes along and hits on the populist issues which have been overlooked by the mainstream politicians.  

Commenters on Waldmann's post point out that the U.S. is not alone in experiencing increasing polarization these days.  So it's not plausible to assign all the blame to the U.S. political system and our rampant gerrymandering.

I agree that polarization is a global phenomenon, with, for example, Corbyn and Hamon demonstrating leftist strength in Britain and France (also Beppe Grillo in Italy). On the other side you have Putin in Russia and Duterte in the Philippines. Populism is the single underlying factor. To put it in crasser terms, it’s the economy, stupid.

Capitalism makes the economy paramount, so it’s not surprising that our neo-liberal, capitalist global consensus is churning in favor of popular demand for ever increasing economic strength. The right wants to deliver by removing all impediments to national prosperity, despite the obvious need for many of the impediments (fairness, environmental protection, compassion, maintain peace). The socialists want to derail the train whose momentum is heading to the competitive abyss.

Ezra Klein and other centrists hand-wringers seem to see where the train is headed, but remain frozen like deer in the headlights. In my opinion, we all should join with Sanders, Corbyn, Hamon, the Pope, and other socialists and deal with pressing human, and populist, human needs.  There is a significant movement, heavily weighted toward youth, that is leading the way.

Monday, January 30, 2017

Sanders, Corbyn, Hamon

We now have strong showings by socialist politicians in France, as well as in the U.S. and Britain.  From https://en.wikipedia.org/wiki/Beno%C3%AEt_Hamon

Hamon announced his intention to seek the French presidency in August 2016. Critical of the social-liberal politics conducted by Hollande and Prime Minister Manuel Valls, he represents the left-wing and politically green side of the Socialist Party during this primary. Hamon is considered an admirer of United States Senator Bernie Sanders.
He wants to rethink society and its relation to work by giving a basic income to all French citizens, believing that the availability of work will decrease due to automation. He supports a 35 hour workweek, and less if a worker chooses in exchange for state compensation, and supports the legalization of cannabis and euthanasia. He also argues for huge investments in renewable energy, aiming for renewable sources to provide 50% of French energy by 2025, and wants to protect the "common goods" (water, air, biodiversity) in the Constitution. Hamon is also very critical of the neoliberal "myth of infinite economic growth", which he blames for "destroying the planet" and argues is a "quasi-religion" among politicians. "There is an urgency to change now our way to produce and consume. [...] We can negotiate with bankers, but we can't negotiate with the planet."
While Hamon's project is seen as credible and coherent about the future evolution of society by some commentators,[10] it is seen by others as utopian.
Polling in January 2017 showed that his support had tripled and put him into serious contention.

The center will have a hard time holding.  On the right, we have Donald Trump, Nigel Farage, and Marine Le Pen.

Here are some of the major mistakes made by the U.S. center in recent years:
  1. Iraq War
    - Syria (indirectly supported Al Qaeda type rebels)
    - Ukraine (cold war mentality has backfired)
  2. Taking ownership of economy after Republican obstruction
    => Trump victory
  3. Budget / fiscal stance
    - top economists flat out wrong
The Democrats should turn around on these three points.  This will win back the Sanders faction and unify the party.

  1. Few people care strongly about the deficit (and those that do are misguided).
  2. The economy is weak when considering pay and benefits, including social benefits provided by other nations.
  3. A good relationship with a strong Russia is in the U.S. best interests.  Al Qaeda in Syria has devastated European politics by generating a flood of refugees.  Obama and Clinton differed on this.  

Saturday, January 14, 2017

Thoughts on the Trump Presidency

Here are two complementary articles on the prospects for the Trump presidency:

I've copied below emails that I've written on these two perspectives.

How Trump's Personality may Shape the Presidency

Here is a quote as to the gist of the article in the Atlantic on Trump's mind:
While a range of factors, such as world events and political realities, determine what political leaders can and will do in office, foundational tendencies in human personality, which differ dramatically from one leader to the next, are among them.

Here are some further excerpts, which form a somewhat coherent summary of the long article:
because he is viewed as markedly less ideological than most presidential candidates, Trump may be able to switch positions easily, leaving room to maneuver in negotiations with Congress and foreign leaders 

 The Art of the Deal, Trump counsels executives, CEOs, and other deal makers to “think big,” “use your leverage,” and always “fight back.” When you go into a negotiation, you must begin from a position of unassailable strength. You must project bigness. “I aim very high, and then I just keep pushing and pushing and pushing to get what I’m after,” he writes.
Trump’s focus on personal relationships and one-on-one negotiating pays respect to a venerable political tradition. For example, a contributor to Lyndon B. Johnson’s success in pushing through civil-rights legislation and other social programs in the 1960s was his unparalleled expertise in cajoling lawmakers. Obama, by contrast, has been accused of failing to put in the personal effort needed to forge close and productive relationships with individual members of Congress.

more often than not, narcissists wear out their welcome. Over time, people become annoyed, if not infuriated, by their self-centeredness. When narcissists begin to disappoint those whom they once dazzled, their descent can be especially precipitous. 

the fundamental backdrop for his life narrative is this: “Man is the most vicious of all animals, and life is a series of battles ending in victory or defeat.” The protagonist of this story is akin to what the great 20th-century scholar and psychoanalyst Carl Jung identified in myth and folklore as the archetypal warrior. According to Jung, the warrior’s greatest gifts are courage, discipline, and skill; his central life task is to fight for what matters; his typical response to a problem is to slay it or otherwise defeat it; his greatest fear is weakness or impotence. The greatest risk for the warrior is that he incites gratuitous violence in others, and brings it upon himself. 

you will rarely, if ever, witness his stepping back from the fray, coming home from the battlefront, to reflect upon the purpose of fighting to win—whether it is winning in his own life, or winning for America... Trump’s persona as a warrior may inspire some Americans to believe that he will indeed be able to make America great again, whatever that may mean. But his narrative seems thematically underdeveloped...  It is as if Trump has invested so much of himself in developing and refining his socially dominant role that he has nothing left over to create a meaningful story for his life, or for the nation. 

Structural Factors that Shape the Presidency

I ran across another article about what we might expect from the Trump presidency.  While the last article discussed Trump's personality and how that might affect his performance as president, this one looks at the political landscape and how the Trump phenomenon may be the dying spasm of the Reagan era.  

The author, Corey Robin, makes a strong case, in my opinion.  This article and the Atlantic article about Trump's personality complement one another nicely.  

The whole article is good, and shorter than the one about Trump's personality.  So I encourage you to click on the link above and read it.  It's hard for me to pull out a few excerpts to make the case as effectively as the author, but here are some excerpts:

Yet when Carter won the presidency in 1976 in the aftermath of Watergate, with congressional majorities far greater than Trump’s, many also believed that he might save his party by renovating it from within. Carter expertly set the scene during the campaign, repeatedly declaring himself an “outsider” who would take on the established interests of not only the GOP but his own party as well. “They want to preserve the status quo,” he said of Democratic leaders. They want “to preserve politics as usual, to maintain at all costs their own entrenched, unresponsive, bankrupt, irresponsible political power.”
This wasn’t just posture; it was also policy. Carter railed against the “horrible, bloated, confused . . . bureaucratic mess” that was the New Deal state, “the layers of administration, the plethora of agencies, the proliferation of paperwork.” With almost Trumpian crudity, he decried the liberal tax system as “a disgrace to the human race” and wrote off Congress as “disgusting.” In a frontal assault on the legacy of FDR and LBJ, he declared welfare a “failure” in “urgent need of a complete overhaul.”
We remember Carter as an extraordinarily hapless President, but for a time he was remarkably effective at scrambling the political map. (Both Tip O’Neill and Robert Byrd marveled at his success.) Delivering on his promise to abandon old ways of doing things, Carter deregulated the banking and transportation industries...

His reconstructive achievements—particularly toward the end of his Presidency, when he elevated Paul Volcker to the Fed, slashed social spending, and increased the military budget—became the signs of his disjunction. Like Herbert Hoover a half-century before him, he was the last man standing, the poor schmuck who came into office to nudge his party away from its commitment to a weak regime, only to be deserted by his party and tarred by his opponents as that regime’s most orthodox defender...

Carter shyly confessed to having “committed adultery in my heart”; Trump brags about grabbing pussy. Carter was a moralist and a technocrat; Trump, an immoralist and a demagogue. Carter was a state senator and a governor; Trump has no political experience. Carter wouldn’t hurt a fly (or a rabbit). Trump takes pleasure in humiliating others, particularly women and people of color...

However tempting it may be to ascribe these phenomena to Trump alone, some part of the specter of illegitimacy and disapproval that has enveloped him is due to the increasingly fragile nature of the Republican regime itself. In the same way that Carter was saddled with a debilitated New Deal regime, so has Trump, despite his moves toward heterodoxy throughout the campaign, hitched himself to Reagan’s free-market regime, with its worship of the man of the market and the man of money, and concomitant commitments to tax cuts and deregulation. That regime has been in a slow free-fall for several years.

The declining trajectory of support for Republican Presidents—from Nixon’s 60.7 percent of the vote in 1972 to Reagan’s 58.8 percent in 1984 to Bush’s 50.7 percent in 2004 to Trump’s 46 percent—is one measure. The steady diminution of voters identifying as Republicans—Gallup polls consistently put Republicans behind Democrats and independents—is another... As multiple media outlets have reported over this past year, younger voters consistently voice a preference for socialist or anti-capitalist politics. The breakout support for Bernie Sanders offers an additional measure of dissatisfaction with the reigning neoliberal regime, as do Trump’s erratic jabs at crony capitalism and fitful defenses of Medicare and Social Security... Trump—elected with far less support than Bush and without, at least not yet, the ballast of a popular war—is the inheritor of this uneasy, increasingly fractious coalition...   
While Trump's personality will undoubtedly play a significant role in the upcoming years, I believe that extraordinary persons are the products of their societies, and that their extraordinary actions would be impossible without the social conditions in which they are born and live (i.e I don't believe in the Great Man theory).  Trump's popular success follows naturally from the Reagan-era globalization and ownership society, which has helped the rich (the owners) and hurt workers (who face more competition from 3rd world laborers).  Trump has made good political use of Twitter and identified the main weakness of the Reagan era, but has no coherent plans to address the problems he highlights.  He is a Reaganite Republican in a society that wants something different.