The Debt Limit fight is a Coup

We’ve been hearing about the debt limit for months, but familiarity makes it sound sort of normal.  That is spectacularly wrong.

We all know it would be a disaster for this country to foreclose on its debt.  That would not only have massive economic impact, beyond that it would undermine international confidence in the United States for any of its commitments.  That the Republican Party is playing chicken with those consequences shows just how divorced it is from the well-being of the country.  What’s not to like about a forced recession in a Democratic President’s election year??

However even that doesn’t do justice to what is going on.  The issues under discussion are not merely financial.  McCarthy is going after specific parts of the Biden legislative agenda with his own alternatives.  The debt limit fight is an effort to replace our Constitutional form of government with a new Republican agenda forced upon the country at gun point.  That is not an exaggeration.

The Debt Limit fight is a coup.

Democracy is Not Natural

There is a fundamental misunderstanding of democracy that undermines much domestic and foreign policy.  One way to put it is that democracy is seen as a kind of natural way for societies to organize themselves.  What could be more normal than a bunch of people getting together for mutual benefit?  Just get rid of the autocrats, and the people will rule.

Unfortunately it’s the autocrats who are natural, and democratic societies are fragile, rare, and in dire need of careful cultivation.

For starters we can go back to the classical Greek models.   Democracy in Athens was both a sham and a disaster.  The Athenian democracy was created by Pericles as a way of wresting power from aristocrats.  Under its auspices he ruled with enormous personal power, and when he died things went to hell quickly.  The chaos led first to an authoritarian takeover (stopped only by the army) and then to the defeat of Athens by Sparta in the Peloponnesian wars.  Plato, writing later, dismissed democracy as nothing more than a prelude to dictatorship. 

As another example, a whole raft of new democracies were created in eastern Europe in the wake of World War I.  By the end of the 1920’s every single one of them was a dictatorship.  Once you’re in power there’s no reason to give it up.  And without a broad societal commitment to democracy, there’s nothing to prevent that.  Hitler of course was installed by a democratic election, and the conversion to dictatorship followed quickly and easily.

In the US today we’re so accustomed to this idea of democracy as normal, that we’re unprepared for today’s anti-democratic Republican party.  Since we don’t even ask why democracy is good, the question “why should we give up when we’re winning?” has no answer. Republicans today and their Supreme Court are unapologetically all about winning and maintaining power indefinitely. We’re surprised how easy it is to subvert our institutions, but that‘s what happens if society is not prepared to fight.

There are in fact a strong arguments for democracy.  We can look today at what goes on in China and Russian.  With authoritarian leadership you can never correct disastrous mistakes or deal effectively with corruption.  Further, autocrats once installed are beholden to no one. Rule of law goes out the window, so there is no protection from the rich and powerful. As we’ve pointed out here before, the enemies of democracy are no one’s friends. One problem is that people tend to think that the status quo is permanent, since they’ve always lived it.  So real consequences tend to come as a surprise.  Think of Brexit and the Supreme Court Dobbs decision.

Democracy is important, fragile, easily lost, and very hard to recover.  The powers that be (e.g the ever-present Koch organization) will always want to stand above rule of law.  They have enormous powers to sway the population, and once the population loses interest it’s hard to keep them out.  It is everyone’s responsibility to stand up for democracy.  There’s plenty of publicity these days about the threat to democracy in Israel, but the threat is just as real here and now.  It may take the same kind of mass movements to fight it.  As we all know the Supreme Court already has an end to democracy on its docket, and we can expect to hear about it in June.

Finally it’s worth recognizing that this same misunderstanding of democracy contributes to foreign policy goals that are to say the least delusional.  Most countries are corrupt dictatorships, and they’re going to stay that way.  Further our own attempts at state building (as in Iraq or Afghanistan) will continue to fail in chaos and corruption, because belief in self-evident democracy means there is no recognition of the magnitude of the job (or our own contributions to the problems). In one of Elena Ferrante’s novels she speaks of the power of expectations in controlling behavior—you cannot suddenly have democracy and the rule of law if that’s contrary to the everyone’s experience: 

“It was a world of favors, of services exchanged for other services, of debts contracted and debts called in, of concessions obtained and never returned, of pacts that could be broken and others that held until death. It was a world based on friendships and animosities, on associations and affiliations, on old enmities and new alliances. How could one change that world? By oneself, no one could. There was only one possibility: to become part of it, accept its conditions, go along with it to survive.”

Our biggest responsibility to the world is to build a working democratic society.  At the moment that’s a tall order, but that’s the job we’ve got.  In this juncture in history the US and EU are critical–the West is on the line to show it is a model that can be believed in. That’s not self-evident.

What To Do About TikTok

It seems to me that the discussion of TikTok is distorted by the kind of xenophobic paranoia that frequently gets in the way. It’s not that there isn’t a problem, it’s that the real problem is not solved by a fixation on nasty foreigners.

There are two frequently discussed problems (that often get confused with each other):

  1. We’re giving a whole lot of information to TikTok that could be used by the Chinese government for nefarious purposes.
  2. The Chinese government could use their state-sanctioned control of TikTok to propagandize to TikTok’s base of customers.

The first point is pretty close to nonsense. Monumental amounts of information on the American population are already being collected, organized, and merchandized by companies who do this for a living. The last time I looked at this issue, more than ten years ago, you could already match what TikTok knows. Today it’s far worse. We need legal controls on information gathering. The fixation on TikTok for this issue is a distraction.

The second point is a more serious issue, as we’ve had more than enough experience with the coercive effects of social media. The problem, however, is that the dangers from TikTok are not an awful lot different than the dangers from good old American social media. There’s nothing that stops the Chinese government from putting propaganda on TikTok, but we’ve already had the Russians (and the Koch people) doing the same thing on Facebook. Unless we put up legal barriers to deliberate manipulation, social media are for sale to the highest bidder. Banning TikTok is just plain not the issue. (To my mind, any network operator that selects content for unsolicited distribution to users should be legally responsible for that content.)

You can even say flatly that the reason there is such bipartisan agreement on banning TikTok is that it is a handy way to make it seem that you’re doing something about a serious problem–without upsetting the real perpetrators much at all.

Call to Action

Democrats must challenge Republican lies about inflation. The Republican message is simple: “Inflation is caused by Democrat’s unrestrained spending. Elect us and we’ll stop that and fix it.” Both parts of that message are lies.

Inflation is everywhere in the world and we’re generally on the good side of average. That last Covid payment is not what turned the world upside down. We’re still fighting the product and labor bottlenecks that persist. Republicans haven’t proposed one single bit of a plan.

Furthermore, as several authors have pointed out, Republicans are anything but a safe choice. We’re not talking about the old conservative Republicans. These are Trump’s burn down the house people. With the debt ceiling blackmail, Republicans are going after Medicare and Social Security with a threat of liquidity collapse if they don’t get it. We’re going to outdo the British Conservatives with Liz Truss!

Finally it needs to be recognized that the Republican argument on inflation is just a rehashing of the usual Republican program of presents to the rich. Inflation is the lastest bogeyman to say we can’t have public services or anything else that rich people don’t want to pay for.

A Message for Democrats Now

It has become clear from all polls that the key issue for voters in this midterm election is inflation.  That’s a difficult issue for Democrats, so we have tried to make it something else:  January 6, the Supreme Court, etc.  The time has come to realize that all of that has failed.  That’s particularly scary, because all of the crazy people we helped nominate in Republican primaries now stand a good chance of being elected—because voters view Republicans as better for the economy, regardless of how crazy a particular candidate may be.

So there is no substitute for taking on inflation as an issue.  It’s not as if we have no answer for this, but the time to act is now.  Please, please contribute to this.  For what it’s worth l give a few points here.

  • Current inflation is not something created by the last stimulus checks. 

Inflation is a worldwide phenomenon, and we are actually at the low end in the Western World.  It is the worst in 40 years, because we haven’t had anything like Covid for many decades.  Even today we have many categories of manpower shortages (e.g. women who can’t work because daycare centers were closed by Covid) and product shortages (e.g. in electronics) as well as changes in demand patterns (e.g. in real estate).  Energy prices are being manipulated as we resist Russian aggression in Ukraine.  We have been working to deal with all of this.  There is no simple case where none of it would have happened.   Further, since Republicans are pretending they can blame everything on Democrats’ spending, they have no plans to make any of it better.

  •  There isn’t any inflationary profligate spending in the rest of the Democrats’ program

Republicans are rushing to take responsibility for results of the infrastructure bill—even in many cases where they voted against it.  Most of the population recognizes that the climate measures are absolutely necessary.  For student loan debt, many people seem to have been confused by the $400 B figure attached to the program.   In fact this is an accounting issue, where the number is spread over decades, without any significant near-term or per year effect.   It should also be noted that college tuition costs essentially doubled starting in 2008, so there is an issue to be addressed.

  • The current Trump Republicans are not the fiscally conservative, reliable Republicans of old.  They are ready and willing to sacrifice all of us to the wild idea of the day. 

The now-serious debt ceiling blackmail is a case in point.  Republicans are ready to throw caution to the winds—in a very precarious world economy.  Massive cuts in Medicare and Social Security would be on the block in such an effort.  And forcing a US default in today’s world would create a liquidity crisis to make the Liz Truss affair look like nothing at all.  Trump Republicans are also ready to tank the economy if they think that will help elect their hero in 2024.

One British observer described similarities across the Atlantic: “Like the Republicans in the United States, the Conservatives are detached from reality. In a generation, they have become a party of monomaniacs, incompetents and ideologues.” We shouldn’t be laughing about Liz Truss here.

The Depression of the 2020’s

We’re not paying enough attention.  This midterm election hides a real danger of Depression.  We’re stumbling into exactly what happened in the 1930’s.

The Great Depression of the 1930’s occurred when the financial authorities of the day responded to a sudden downturn with the opposite of what was needed.  A straightjacket of fiscal austerity was applied (by the self-protecting upper classes) in place of the stimulation that would have enabled recovery.   That shut down everything in the US and much of the western world.

We are currently fighting inflation.  That’s a tough battle and will cause a slowdown that is some variety of recession.  It’s what happens next that matters. 

The only reason we got out of the 2008 recession was that there were enough Republicans to join Democrats in passing a stimulus package early on.  Already by 2010 there were few of those Republicans left, and any further stimulus was blocked in the name of the bogus “balanced budget amendment”.  The goal was national pain ahead of the 2016 election.  It worked.

We’re in that situation again, but the dangers are much worse.   To state the obvious, the worldwide economy is in extremely fragile state:  inflation is everywhere (we’re actually on the low side), there is war in Ukraine (with direct consequences for many countries), energy prices are rising from Saudi greed, there’s even a dictatorship-induced slowdown in China, and (compared with 2008) there is very little international cooperation.  Forced austerity is exactly what brought the world economy down last time, and we’re going to get it again.

For today’s Republican Party a recession is an opportunity.  A Republican (Trump) Congress will do anything to bring back their hero.  As in 2014 there will be no possibility of stimulus no matter how bad things get, because pain is the goal.  By 2024 it will be too late for any short-term way out. 

The Great Depression was so bad, that it seemed that people would always remember what happened and never do that again.  Unfortunately we’re there.

Some Reality for the Midterms

I’m tired of arguments over whether Republicans or Democrats are better managers of the economy.  The situation for the midterms is starker than that. 

In this election cycle we are parallel to 2014, a mid-term election with an open Presidential election to follow.  What did the Republican Party do with their power between 2014 and 2016?  They shut down government with the “balanced budget amendment” nonsense (forgotten immediately under Trump) in order to cause national pain for the 2016 election.  That is no exaggeration—it was deliberate policy.  The student loan crisis and the pain in “flyover” districts were direct results.

In 2022 we are at an economically delicate moment—trying to control inflation without a serious downturn.  A Republican Congress will do exactly what they did last time—shut down government (this time in the name of inflation) to make sure things get worse for 2024.  Given the risks of the moment, the consequences can be dire. 

We can either elect a Congress interested in avoiding the worst, or we can elect a Congress dedicated to provoking a recession and making sure it lasts. 

Propagandists for Power

This note is occasioned by John McWhorter’s piece in the NY Times, basically praising Clarence Thomas as a thinker who has been too easily dismissed.

While I agree with Mr. McWhorter on some subjects, I think he is very wrong on this one.  And his mistake is the same one made by other people about other public figures.

First about Clarence Thomas:

  • He is someone who has received help every step of his career, but who has nonetheless declared himself self-made.  His autobiography is emphatic to the point of absurdity on the subject. 
  • His general philosophy is heavily influenced by that mythology.  Like many other pseudo-self-made people (there are admittedly more rich than poor of them), he asserts “I did it, so can anyone else who has what it takes.”  No one should be asking government for help.  That he sincerely believes this does not make it either true or admirable.
  • Despite his self-delusions, he has not achieved his success as a thinker.  He has achieved success as a propagandist for power.  His ideas, however well or badly thought-out, are irrelevant to his current position.  He is a tool in the Koch organization’s (and Republican party’s) battle plan.  The position being propagated is simple and convenient:  we just don’t have to care.
  • Contrary to what you sometimes read in the papers, he has not driven the Supreme Court to its current position on the extreme right.  That is a Koch-managed and funded enterprise that has put a succession of Federalist Society judges on the Court.

We should now talk more generally.  There were places and times in the past when people seemed at least worried about selling out.  That is, whether they were putting personal advantage above some notion of morality.

We are no longer at that place or time.  In the United States (and elsewhere) today, there is no morality stronger than financial success.  People don’t need to agonize anymore, because riches are proof of morality.  That’s the Clarence Thomas problem, and he is far from the only example.

I’d even put Milton Friedman in that category (along with a good chunk of the Federalist Society).  Milton Friedman was certainly capable of understanding the logical flaw in his argument:  it’s okay to declare that corporations serve their stockholders—but only if someone else is minding the store.  If those same corporations are also running government, then no one is minding the store.  Instead he made himself a wealthy and respected genius, again as a propagandist for power.

No one should be venerating propagandists for power, no matter how sincere such people believe themselves to be.