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It’s become the style lately to call the Republicans “Social Darwinists”, just as it has for some time been the style for Republicans to call Democrats “socialists”.  I’ve often said in responding to the Republican charge that, by their definitions, virtually everyone is a socialist. And I have to say, from what I read, by any definition, everyone is a “Social Darwinist”.

“Social Darwinism” means using the idea of  “survival of the fittest  to justify social policies which make no distinction between those able to support themselves and those unable to support themselves”, according to Wikipedia. Whenever I hear it, I think of Mandalore in KotOR II saying “the purpose of the weak is to feed the strong”. That’s what it boils down to: “Go Team Strong! Crush the Weak!”

The thing is, “the Strong” and “the Weak” are rather nebulous concepts. I mean, people are strong in some areas and weak in others.

For instance, here is a list of the most athletic Presidents ever. I bet Rob Gronkowski is a better athlete than any of those guys. Compared to him, they’re weak athletically. Yet, Rob Gronkowski will never be the Commander in Chief of the World’s most powerful military. And that’s because he is probably one of the weakest people in the world when it comes to politicking.  Bill Gates can’t bench as much as Ryan Kennelly, and yet he has done alright for himself in the world. Who is “weak” and who is  “strong” depends on the situation.

“Survival of the fittest” is practically tautological: “Who survives?” “The fittest!” “How do we know they’re the fittest?” “They survive!” (Before anyone gets excited, note that this does not disprove Darwin’s Theory of Evolution, much as some of my religious friends wish it did.)

In the broadest sense, “Social Darwinism” could be said to just mean “the world needs more good people and less bad people”. Everyone agrees with that. The difficulty comes in defining “good” and “‘bad”.

Ayn Rand, as we well know, chose to define good people as “people who had earned a lot of money by selling stuff in the free-market”, and bad people as “people who produce nothing and take government money”. So, the Randian worldview, somebody on welfare is “bad”, but a billionaire author is “good”. I have chosen these examples because I have in mind one person who was both: J.K. Rowling. And she would not have been able to be a billionaire author had she not taken government assistance. This is one of the biggest problems with the Randian worldview.

The Republicans are not “Social Darwinists” as much as they are “Defenders of People with Lots of Money”. Paul Ryan may have repudiated Rand the other day, but let’s face it; he’s just saying that so people don’t start saying he’s an atheist.

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“Is Our Economy Too Complicated for Our 18th-Century Political System?” That’s the question Michael Moran asks in Slate. It’s an interesting article, but he kind of ignores the elephant in the room: the Federal Reserve, which was established in 1913. As any good Ron Paul supporter will tell you, there’s nothing about it in the 18th-Century document upon which our government is based. (Of course, what same Paul supporters forget is that the power of monetary policy lies with Congress, which I don’t think they would see as an improvement over a central bank.)

I have in previous posts addressed the issue of the Democrats’ recent tendency towards economic deregulation that Moran writes about, so I won’t re-hash it now. The main point I want to make is that, at least on reading his article, it sounds to me like he’s asking the wrong question. It’s not that the economy’s too complicated, it’s that the parties are too beholden to certain special interests.

Moran also says:

The real problem is the civil war raging within the GOP, whereby a weakened elite (wiling to make a deal) has lost control of its nativist, willfully ignorant right flank. Nothing less than electoral failure will bring that war to an end, and in spite of early polls showing a race in November, I think failure is precisely what awaits the GOP in November. There is no teacher, after all, like failure.

Yes, people thought that in 2008, as well.

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You have all heard Hilary Rosen’s comment that Ann Romney “never worked a day in her life”, and subsequent apology. You have all also probably heard the liberals saying she shouldn’t have apologized; as she was entirely right.

My take: Rosen was sort of right, but she spoke clumsily and was right to both clarify and apologize. But it’s not really Rosen’s fault. Nor is it Mrs. Romney’s fault. It’s not even Mr. Romney’s fault, although he was misleading people with the comments he made that started the whole thing. It’s Simon Kuznets’s fault. (I hate that tired, cliché ending: “the economist did it.”)

Kuznets invented the Gross Domestic Product, a measure of economic output which does not include household work. So, for this and other reasons, it is not an accurate measure of economic output. Kuznets himself said it was not a good measure of economic welfare, but he seems to have been ignored on that score.

So, what Rosen should have said by way of apologizing was: “Ann Romney has not done work that is counted in the widely-used measure for economic welfare. Therefore, her comments and advice aren’t relevant to women participating in the economy as it is presently measured by politicians and economists. I apologize for implying Mrs. Romney did no work at all.”

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Two good pieces on Slate today; one about sociologist/philosopher William Graham Sumner and one about apocalyptic campaign ads. I’ll tackle the latter first.

It’s a good list, but I disagree with the claim that “when candidates get desperate, they try to scare you.” Was Nixon really desperate in 1968, or Johnson in 1964? Scaring people is always an effective tactic, whether they’re desperate or not. All attack ads either try to frighten or ridicule, and those that ridicule usually carry an undercurrent of frightening, as the idea of such a buffoon as the target of the ad taking office is scary by implication.

By the way, it didn’t make the list, but in my opinion the best political attack ad ever is this one, from Nixon’s 1968 campaign against Hubert Humphrey:

That ad is purely visceral. There’s not even any language in it until the very end, which is as it should be. The effective advertisement must appeal to instincts and base, gut feelings, not sophisticated reasoning. Trippy and weird as it is, this ad is psychologically effective.

On to the second piece, about William Sumner. His anti-socialist, “leave the rich people alone” philosophy sounds to me pretty similar to the ideas of his contemporary, Herbert Spencer. And it seems that Sumner was who coined the phrase “the Forgotten Man”, which, as my readers will know, has formed the theme of many a ham-fisted Jon McNaughton painting.

So, I skimmed some of the Sumner essay “What Social Classes Owe to Each Other” that the Slate article talks about. I confess, I could only skim because it was quite dull; most of the ideas in it are old hat by now, but it’s important to remember that they must have seemed novel at the time.

Sumner begins the essay by complaining:

We constantly read and hear discussions of social topics in which the existence of social classes is assumed as a simple fact. “The poor,” “the weak,” “the laborers,” are expressions which are used as if they had exact and well-understood definition. Discussions are made to bear upon the assumed rights, wrongs, and misfortunes of certain social classes…

He does not like the phrase “the poor man” one bit:

There is no possible definition of “a poor man.”.. The “poor man” is an elastic term, under which any number of social fallacies may be hidden.

And then:

There is an old ecclesiastical prejudice in favor of the poor and against the rich.  In days when men acted by ecclesiastical rules these prejudices produced waste of capital, and helped mightily to replunge Europe into barbarism. The prejudices are not yet dead, but they survive in our society as ludicrous contradictions and inconsistencies. One thing must be granted to the rich: they are good-natured. Perhaps they do not recognize themselves, for a rich man is even harder to define than a poor one. It is not uncommon to hear a clergyman utter from the pulpit all the old prejudice in favor of the poor and against the rich, while asking the rich to do something for the poor; and the rich comply, without apparently having their feelings hurt at all by the invidious comparison.

Well, if I were rich, people could denounce me as much and as viciously as they damn well-pleased and I wouldn’t complain.

But beyond that, it’s like Paul Graham wrote:

Most philosophical debates are not merely afflicted by but driven by confusions over words. Do we have free will? Depends what you mean by “free.” Do abstract ideas exist? Depends what you mean by “exist.

Same problem here. Sumner gets bogged down trying to define things, or show that they can’t be defined, in order to make some point; and it all becomes nearly meaningless.

I’ll try to read more of this essay, but right now my eyes are glazed over. Sumner’s writing is like Ayn Rand’s without any of the animating passion.

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President Obama–the same President Obama who is allegedly engaging in “class warfare” and supposedly out to tax “job-creators”–has announced a plan to “lower the corporate tax rate from 35% to 28%.” Read all about it.

One thing to keep in mind before arguing about what this plan means is that it is a plan that is being proposed. Meaning that if anything ever does come of it, it will probably be completely different than it is now, once all the different interests have hashed it out.

But, just for fun, let’s talk about it. Apparently, idea is that in exchange for these tax cuts, “corporations would have to give up dozens of loopholes and subsidies that they now enjoy. Corporations with overseas operations would also face a minimum tax on their foreign earnings“, according to the Associated Press article.

Okay, but here’s the thing: ultimately whether it comes under the label “taxes”, “loopholes”, “subsidies” or what have you, there is ultimately only one question: do the corporations get more money as a result of this plan or less? I’d like to see some sort of estimated balance sheet that gives some idea whether corporations, if treated as a monolith, win or lose from this plan. I won’t hold my breath, though, because it’s going to be virtually impossible to get good reporting on that.

More to the point, even if you somehow did find that out, we would then have to drill down into the details of which corporations will lose and which will win, and then try to figure out if they’re the right ones. Which is always a gamble, because it’s basically the same problem as trying to pick winners. And then of course, as the AP article points out it is unlikely that any of this will happen in an election year, and thus, even assuming Obama does get re-elected, it’s unknown what the Congress will look like next year.

This is why the idea of getting rid of the whole tax code appeals to people. It appealed to me, in my Libertarian days, until I realized that since taxes in some form are necessary to run a government, there would have to be new one installed, and in the course of installing it, all the same problems would immediately recur.

While we’re on the topic, why is Obama doing this, if such a class-warrior he is? Is he just as beholden to the corporate interests as his Republican opponents. I don’t know, but I know some Democrats who are going to think so.

Long-time readers might remember when I asked the question “was Theodore Roosevelt a socialist?” I said at the time that I thought T.R. “was merely a pragmatist, and found that the easiest way to thwart radical socialism was to allow for moderate socialism.” The same argument could apply here, if we ask “is Obama out to aid the corporations?”* Well, yes, but not as much as the Republicans are. The easiest way to thwart radical corporate tax cuts is to allow for moderate ones.

 

*I did not ask “is Obama a Capitalist?” for reasons which are long and complicated. The short version is that, in my view, very few people can actually be said to be “capitalist”, as almost all countries, governments, and corporations engage in some scheme of artificial wealth redistribution, which, according to some Republicans makes them “socialist”. By their definition, almost everything short of anarchy is socialism. Also, of course, helping corporations isn’t quite the same as being a capitalist, but it’s not being a socialist either.

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Awhile back, I posted half-jokingly about the possibility of space travel to gather materials for production of goods. I think it would make the economy less confined to the resources of Earth alone. That kind of supply shock could help us out a lot.

I mention this because today I saw this L.A. Times interview with a man whose company is working on building robots to mine the moon for resources. It sounds pretty cool.

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Here’s an interesting Reuters article by David Cay Johnston entitled “Closing Wall Street’s casino“. It’s a good article, but whenever people employ the “Wall Street/Casino” metaphor, it’s always puzzled me. Wall Street is, fundamentally, like a casino, and I don’t see any way it can be made unlike a casino.

This is because investing is gambling, because gambling is simply taking an action based on what you expect to happen, but which is not certain to happen. In most cases, of course, money is involved. Whenever you make an investment, you are gambling.

Nobody wants to end all investment, of course. However, the lady quoted in the article, Professor Lynn Stout, thinks that certain types of investment that are not tied to anything in the actual world ought to be got rid of. As the article says “[her] approach would not stop derivatives that are backed by hard assets”, but would eliminate credit default swaps, which the article says are merely “bets on which one party wins and which one loses”.

The problem I have with this is that credit-default swaps are similar to (but not the same as) insurance, and all insurance constitutes “bets on which one party wins and which one loses”. This is basically what options are, as I understand them, and options are generally regarded as useful financial instruments.

My understanding–which, I freely admit, is purely that of an amateur–is that credit default swaps were a problem in the crash of 2008 because no one knew how many of them there were. Because the market in them was something of a mystery, it was not known what would happen to the economy should lots of defaulting occur.

Now we know.

In principle, it seems to me, there is no actual way to stop this sort of risk-taking. Investors who take these sorts of gambles are doing without properly assessing the possible outcomes correctly. I mean, that’s why there was a problem to begin with. I don’t understand how you can stop this kind of thing unless you just ban the trading of options completely.

But, like I said, I have only a layman’s knowledge of this stuff. If someone who knows more reads this, I would love to read his/her comments.

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This is fascinating. According to this story linked to from the conservative site Drudge Report, Tea Party groups are opposing the “Occupy” movement’s attempts to curtail Black Friday spending with a “BUYcott” movement. They are, according to the article, “encouraging consumers to shop on Black Friday to help the economy recover.”

This is interesting for two reasons. First, the Tea Partiers here are pretty much saying “we support the corporations”, which most people already knew, but it’s still surprising how obvious they are about it.

Second is the fact that by taking this action, it seems to me that the Tea Partiers are unwittingly admitting their opponents are right, and that stimulating the demand-side is a way to improve the economy.

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There’s a great  article by Tim Dickinson in Rolling Stone about “how the G.O.P. Became the Party of the Rich”. Overall, it’s a great read, though I do have some criticisms of it. The first is that, although the article tries to portray President Reagan as a tax-raising, pragmatic individual from whose wise leadership the party has sadly deviated, the truth is that they have were “the Party of the Rich” in his time as well, and indeed were such before him.

This isn’t, so far as it goes, an inherently bad thing. After all, political parties are made of interest groups, and “the Rich” are certainly a sort of interest group. Admittedly, not one that can win a fair democratic election, but then the Republicans of today are not just the “Party of the Rich”. They also are the party of nationalism, religious fundamentalism, and many other things.

(It should also be remembered that they won many fewer elections when they were simply “the Party of the Rich”, from the 1930s through the 1960s, than they did when they became “the Party of the Rich and of other things” in the 1980s.)

The point is, it’s not like representing the rich is a new thing to the party. In fact, I think the Republicans have always been that way, or at least it has since the 1870s. Having said that, it is probably true that they are now more fanatical in their pursuit of low taxes. this is largely because whereas the Republicans of decades past were motivated by an (understandable, if not laudable) antipathy to paying taxes, the current version of the party has a Nationalistic wing which opposes the supposedly non-Nationalist liberal government, and wishes to deprive it of resources. This gives a visceral passion to their rhetoric and policy that was lacking before.

The second issue is the author’s claim that the idea of President Bush’s tax cuts providing an economic stimulus:

“…was lousy economics. The previous two decades, after all, had demonstrated that “trickle-down” tax cuts don’t juice the economy – they create bubbles and balloon deficits.”

This is sort of true, but it obscures one thing: “juicing the economy” and “creating bubbles” are almost the same thing. Bubbles almost always result from a booming economy; indeed, I do not believe it is possible for a bubble to arise without a booming economy.

This means that, in fact, the tax cuts were “good” economics, in the sense that they probably did help achieve their proponents’ promise of aiding a short-term stimulus to the economy. Of course, they did have a dramatic downside, as we can see, but this is often the way with such booms.

In my opinion, the Bush administration was right to cut taxes in 2001-2, but they should have (a) made them more favorable to working class people and even more importantly (b) raised taxes in about 2005, during the relatively good economy.

These issues aside, it’s a very good article.

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Economics blogger N. Gregory Mankiw passes along the tale of students walking out of his introductory economics course, in solidarity with the “Occupy” movement. He also links to two letters in the Harvard Political Review, one against his class, the other in defense of it.

Of particular note is this passage from the defense, by Jeremy Patashnik:

“One would presume that, in this letter, students would lay out precisely what biases they find objectionable in Ec 10, but the closest they come to doing so is when they say, ‘There is no justification for presenting Adam Smith’s economic theories as more fundamental or basic than, for example, Keynesian theory.’

Incidentally, the authors of this letter are in for a treat: there’s plenty of Keynesian theory to come in the second semester of Ec 10… The only reason that these students have not yet studied the father of modern macroeconomics in Ec 10, of course, is that the first semester of the class is devoted to microeconomics.”

Now, I have no way of knowing the facts of this case, but this does sound quite plausible to me. Adam Smith’s laissez-faire theories–particularly the well-known “invisible hand”–are all reasonably valid when applied to microeconomics, but don’t hold up so well at the macro level.

The interesting thing is that this might be a case where proponents of Keynes are confused by the works of Smith. Usually, it’s the other way around. In my experience, at least, it’s more common for people with a thorough understanding of micro get confused when they try to claim their theories also hold at the macro level.