Friday, January 3, 2020
Prosperity at yearend; price to be paid later
Gordon L. Weil
As the year ends, it's time to take a look at the state of the economy.
There's a wide gap between what is happening now and what lurks beneath the apparent prosperity.
The economy is flourishing as corporations enjoy benevolent government policies and reduced taxes. The stock market reveals a persistent optimism and keeps climbing. It's considered bad news when a company earns good profits, but might have done better.
A strong stock market rewards investors and should improve retirement accounts. That makes people feel more secure and assured about their futures.
The economy needs more workers than are available, so unemployment falls and wages rise. That's a positive sign for job-seekers. But it may deny growth to employers short of workers.
The low jobless rate has begun to push up pay as employers compete for scarce workers. That's one of the goals of the Federal Reserve in favoring mild inflation.
But the Fed also wants to keep interest rates low to allow businesses to borrow and grow. Low rates translate into more consumers buying homes and autos.
Like any incumbent president, Trump takes credit for the economy, though he probably should share it with Congress and the Federal Reserve.
The key elements of the Trump era economic policy that contribute to the economy are increased government debt, tax cuts and reduced environmental regulation.
The GOP historically opposed deficits, because they increased debt to be paid by later generations. It also opposed government spending to stimulate the economy. All that has changed.
The federal budget has no discipline. The only difference between the free-spending, low-tax political parties is that Republicans focus on military outlays and Democrats favor social programs.
While the GOP fought Obama's efforts to add more economic stimulus spending, it now joins the Democrats in such massive deficits that they are doing just what they had opposed.
These seeming boom times are putting a lot more money in the hands of consumers. Their spending accounts for about 80 percent of the economy. They are piling up more debt. Spending is unusually high, so if it declines, the economy is likely to do so as well.
The problem with this economic high is that the underlying cost is obscured. As almost everybody knows, you cannot indefinitely pay for instant satisfaction by borrowing ever increasing amounts of money. What's more, your immediate desires may not correspond with your real needs.
Eventually paying off government debt becomes so big a part of the budget that either taxes must be increased or essential spending must be cut. If you consider the condition of roads and bridges, we may have already reached that point.
Prices for what consumers want will increase. While China must be forced to trade fairly, consumers should not be pushed to pay much higher prices resulting from the tariffs imposed on imports from all around the world. Higher prices will reduce consumer spending.
Cutting back on environmental regulation may help corporations boost their profits, but at great cost in quality of life. Trump says he favors clean air and water. That's good, but what about drought, fires and flooding as the Earth's temperature climbs? Merely denying science is not an answer.
While low unemployment is always a top goal, what happens when you reach it? Corporations and the wealthy get tax breaks so they will invest to create jobs. But that should not entitle them to perpetual tax breaks, leading to more government deficits, even after unemployment is almost eliminated.
Low unemployment may turn out to be a problem. Without more workers, business cannot grow, becoming better able to meet needs of the domestic and export markets. Natural population growth is so slow it hardly replaces retiring workers.
Right now, the U.S. has no immigration policy other than "keep them out." A sound policy would allow for the entry of people with needed skills and, as throughout the nation's history, people hungry for work and anxious to learn.
Immigrants are customers for a growing economy, new contributors to Social Security, and the labor business needs to expand. If the U.S. closes the door on the economic growth that comes with a larger labor force, it's difficult to believe the current prosperity can last.
Government spending, the environment, immigration, tax policy and trade wars may menace the current prosperity. Economic history shows that expecting the good times to roll indefinitely is mistaken.
The question during good times is not merely how to keep them going, but also how to prepare for difficult times ahead – times of higher prices, huge debt and global warming.
Friday, December 27, 2019
Impeachment not purely partisan for Golden, House swing voters
Gordon L. Weil
You are a first-term U.S. House Democrat, representing a large, sparsely populated district.
In 2018, by a narrow margin, you took a seat, previously held by a Republican. The district had voted for Trump in the 2016 election. You are among the 31 House Democrats, 22 in their first term, who won in districts he carried.
After taking office, you held yourself somewhat aloof from Democratic House leadership. Now, you are faced with the decision of whether to vote to impeach President Trump. There are no party instructions on this vote, because Speaker Pelosi understands your dilemma.
These 31 representatives are the swing votes who will decide if the president will be impeached.
If you are Anthony Brindisi, a newcomer from upstate New York whose district gave Trump a 15 percent margin, you vote in favor of both articles of impeachment.
If you are Jared Golden, from Maine's 2nd district that gave him a 10 percent margin, you split your vote on the two articles, an action not taken by any other House member.
If you are New Jersey's Jeff Van Drew, whose district gave Trump only a 4 percent margin, you vote against both impeachment articles, quit the Democrats and become a Republican. Despite Trump's endorsement, you could well lose your seat.
Two Democrats, Van Drew plus a long-time conservative, voted against both impeachment articles and a third abstained, having the same effect. If only 17 more had joined them, there would have been no Trump impeachment.
The media did the GOP a great service and the voters a great disservice by jumping to the conclusion that the outcome was partisan, except for the three Democrats. That disrespected the integrity of each of the 31supposedly vulnerable Democrats. And it glossed over Trump's standing in their districts.
Here's what's wrong with the media's conclusion.
There was one GOP defector. Justin Amash, a five-term Michigan Republican, had quit the party to become an independent before the impeachment vote. He opposed Trump, quit his party and announced he would not run again. He voted for both articles, but, because of timing, the media did not count him as a GOP defector.
His district voted by 9 percent for Trump. Did his impeachment votes matter? Yes, to Trump. At the very moment the House was voting on his impeachment, the president held a rally in Amash's district.
Did the media check voter opinion in the supposedly "swing" districts? Did they explore whether Brindisi and those like him had tapped into a swing of their district's voters against Trump? Such a switch could provide hints about the 2020 presidential election.
To write off the House votes as purely partisan devalues the Trump impeachment, only the third such action in American history. What about the examples of Brindisi, Van Drew and Golden?
As for Brindisi's district, the Almanac of American Politics reports: "Politically this area had been Republican since the party came into existence in the 1850s." Yet Democrat Brindisi won in 2018.
Perhaps he detected change or, even better, had the courage to force change at some political risk to himself. If he did that, he would deserve praise, not merely being dismissed as partisan.
Van Drew may well have ended his congressional career. He will face well-financed competition in the GOP primary and Democrats angry with what they see as his betrayal. He had to understand this when he voted.
Golden says his split vote was a matter of conscience. He agreed that Trump had abused his powers but believes the courts should decide if Trump had the right to instruct executive agencies not to provide witnesses or documents.
His decision was more a matter of judgment than of conscience. In the Nixon and Clinton impeachment cases, the Supreme Court ruled unanimously against presidential claims of executive privilege.
President Washington said that executive privilege falls in cases of impeachment. But Golden apparently believes each president on the brink of impeachment should have his day in court – even on the same issue.
If there is a question of conscience, it must be rooted in Golden's belief that, even on matters relating to impeachment, which the Constitution makes an exclusive power of the House, the courts have the last word.
His critics might claim Golden split his vote in an attempt to please both sides. That assertion would play right into the easy cynicism of pundits who say impeachment was a purely partisan exercise. For some members at least, it was just as likely to have been a matter of judgment.
The decisions of the 31 could have been based on more than partisanship. They deserve respect for their judgment, whatever it might be. That deference would enhance the historic significance of the impeachment itself.
Friday, December 20, 2019
Trump's rules shape U.K. election; Johnson wins big
Gordon L. Weil
The British election has encouraged political pundits as they rush to reveal what the U.K. vote for Parliament means for the 2020 U.S. presidential race. The chances are good that their predictions will not only be wrong but soon forgotten.
Still, the U.K. elections, which will result in the country's "Brexit" from the EU, illustrated some new rules about politics and how they are changing in the U.K. to follow and confirm the Trump model.
Boris Johnson, the U.K. prime minister, campaigned on the slogan: "Get Brexit Done." After three years of trying to leave the EU, delayed by stubborn opposition and perplexing details, many Britons wanted finally to make the decision and get on with life on their own.
Using a slogan to focus a campaign was not invented in the U.K. Donald Trump used "Make America Great Again" effectively in the 2016 campaign. It worked so well that it has morphed into "Keep America Great" in the current campaign.
Slogans seem to be replacing platforms. In an increasingly complex political world and with the short attention spans of voters, they may be the key to successful campaigns.
Catch phrases leave it to the voter to decide what they see as a slogan's meaning. "Get Brexit Done" may imply greater political predictability or a relationship with the EU ranging from a "hard" break to sticking pretty close to its rules. Voters can see in the slogan whatever they'd like.
Similarly, MAGA may mean policies ranging from an enlarged military to reduced environmental regulation to outright historic racism. The meaning is left to the voter.
Some Democrats have caught on. "Medicare for All" could be a call for broad change in federal social policy, not only national health insurance. Politics by slogan may be a clever idea.
The U.K. election also highlighted another trend. Countries are moving in away from trying to solve problems through joint action with other countries.
Obviously, Brexit means that Britain is leaving a close trade and economic arrangement with a large group of countries in favor of going it alone. That's exactly what "leave" voters wanted.
Is that much different from the U.S. confronting the EU, Canada and others? Questioning NATO and holding back on U.N. payments are American moves away from international commitments.
The U.K. election emphasized the huge importance of two issues growing out of this increased nationalism – trade and immigration. They are both central to the American political debate.
Countries increasingly believe they will do better in trade relationships one-on-one than they can in multi-national agreements. The U.S. rejected the Trans-Pacific Partnership, a group of about a dozen nations aimed at blocking China's influence. Instead, Trump has chosen to confront China on his own.
The EU has truly integrated European economies and their prosperity has grown. But Britain has a proud history of playing a major international role and believes it can do better on its own.
The U.S. and the U.K. are united in opposing large-scale immigration. American policy seeks to limit people from Latin America. The U.K. will use Brexit to stop the flow from Eastern Europe. Other European countries pursue similar policies.
Another signpost from the U.K. election is that, though a leader may succeed nationally, such success may stress the fabric of the country and even its national unity.
Johnson has placed an economic border between Northern Ireland and Great Britain, leaving the Irish part of the U.K. in the EU. That move is promoting serious consideration of uniting it with the Irish Republic, which remains an EU member.
Scotland wants to remain in the EU and is now moving toward a referendum on leaving the U.K. It could decide to rejoin the EU on its own.
In the U.S., no state can leave the Union. But on abortion and the environment, we see increasing pressure to allow each state to set its own rules. That kind of renewed state sovereignty could expand if the country remains deeply divided.
Johnson's win also confirms that the character of political leaders matters less than their message. Johnson famously lied to the Queen; Trump sets records for launching lies from the White House. Their personal lives would once have disqualified them and been considered scandalous.
Their personal defects may lead some opponents to believe that character faults will inevitably lead to election defeat. Voters had the chance to dump Johnson, but instead gave him a bigger majority. Trump's questionable actions are routinely accepted.
The developments in the U.S. and the U.K. may turn out to be temporary aberrations. If they yield stability or reflect emerging majority opinion, they could represent a new political era with new rules.
Friday, December 13, 2019
Congress now in impeachment spotlight, but its powers fade
Gordon L. Weil
A funny thing happened to the House on its way to impeachment. It got lost.
It happened a long time ago. Despite the unusual focus of impeachment on the role of Congress, it highlights just how irrelevant the national legislature has otherwise become.
In the congressional conflict with President Trump, its leaders stress that the House and Senate were placed in Article I of the Constitution for a reason. In a government with "three co-equal" branches, the legislative branch is really most important.
The House majority disputes Trump's objections to impeachment, reminding him that the Constitution gives the House "the sole power of impeachment." This congressional power provides no role for the president.
In reality, among the three branches of government – legislative, executive and judicial – Congress may have the least power. Compared with the executive, it obviously comes in second.
Shedding oppression by the British king, the drafters of the Constitution sought to ensure control of the federal government would not be exercised by one person but by legislators representing the states and the people. Hence, Article I.
But they were overly optimistic. Three of the country's greatest presidents would deal with challenges that increased their powers. Washington was empowered to create the federal executive. Lincoln led the country to save the Union. F.D. Roosevelt rallied the nation to reform the failing economy and win a world war.
Even without those events, central control of the military and foreign affairs in the world's major power made a strong executive inevitable.
The country spread across a continent. At the same time, managing public affairs became more complex as government dealt with matters ranging from race relations to railroads.
From the outset, Congress delegated to the president powers that were meant to be under its control. The task of governing became so complex that authority came to be exercised by executive branch officials and regulators.
Gradually, Congress accepted that the president should be granted broad authority because either the chief executive could respond rapidly to new problems or members of Congress could avoid responsibility for necessary but unpopular policies. As impeachment reveals, Congress is left with little ability to control presidential action.
In recent decades, Congress has also allowed the Supreme Court to make legislative decisions that were its responsibility. Because the legislative body either passes unclear and conditional laws or doesn't pass them at all, the Court often fills the gap.
Take the abortion issue as an example. While federal law bans spending for abortions, it fails to define rights or limits, if any, for the procedure. In filling this gap, the Supreme Court issued its decision in Roe v. Wade. The matter was settled, perhaps tentatively, by nine justices, not by the elected Congress.
Strict party allegiance and the resulting partisanship promote executive power. Parties in Congress back, almost blindly, presidents of their own party.
Senate Majority Leader McConnell won't allow votes on major bills unless he is assured of White House support. Ceding all power to the president, the Senate has given up the role of an independent legislature.
What about Maine? Gov. Paul LePage set the record for vetoes, even rejecting bills passed with huge majorities or even unanimously. After the Legislature received a LePage veto, Republicans would often reverse their previous support for the bill and sustain their governor's position to kill it.
Public opinion rates Congress even less favorably than the president. Compared with the president, members of Congress, whose prime focus is gaining re-election, seem to take little action. In part, that appearance results from the media focus on the president, easier to cover than Congress.
During the unusual House exercise of its unique power of impeachment, the favorability rating of Congress has increased. While that rating gain may be heavily partisan, it recognizes a rare moment of congressional action. The people probably want more.
To recover power, Congress could pass simple and unconditional legislative directives, not leaving it to the executive branch to fill in the blanks. It should decide tough issues and not leave them to the courts. Both take hard work and the courage to resist special interests.
By stripping power from congressional leaders, members would be less straitjacketed by party discipline. Beginning in 1994, party discipline became a major cause of extreme partisanship. And, by giving leaders complete power to set the agenda, members allow them, like the president, to weaken the legislative branch.
Voters elect legislators, not political robots. Members should focus more on exercising their legislative powers and worry less about their permanent campaigning for re-election.
Friday, December 6, 2019
Trump, Sanders seek to reform 'liberal world order'
Gordon L. Weil
Is the presidential campaign already boring or confusing?
The pundits endlessly ponder, "Who won the last debate? Who's ahead in the Democratic caucus in Iowa? Can Trump win again?"
As usual, people following politics are being treated to a campaign covered like a sports event.
But this may be a landmark election. Despite appearances, it won't simply be about keeping or rejecting Donald Trump as president. It will offer a stark choice about the country's future. There are three options.
The choice starts, not with Trump, but with the "liberal world order." That's the system that emerged following the end of the Second World War in 1945. It is not "liberal" in the narrow political meaning. In this case, liberal means freedom and democracy for all.
Under this system, American-style democracy was supposed to take root in many countries. Governments would be chosen by the people. Their main task would be improving the quality of life of citizens. Average people would gain a greater share of national wealth through new jobs and prosperity.
Military conflict among countries would be reduced, because nations would agree on rules for settling their differences. The United Nations would allow the winners of the Second World War to ensure the rules were followed, so that peace could be promoted.
In Europe and elsewhere, this new world order succeeded under American leadership, but it also experienced obvious failures, which became more apparent over time.
National democracy produced disappointing results for many people. Instead of promoting prosperity, it could cause a growing gap between the wealthiest people and the rest of the population. Woman and minorities did not gain equality with dominant groups.
In world affairs, the Soviet Union rose, broke the rules, and eventually declined, leading to hopes that Russia, its successor, would join the new order. Instead, Russia rose and broke the rules. So did China. Non-government terrorists attacked. The U.S. engaged in endless wars based on questionable assumptions. The U.N. was helpless.
In the U.S. and other countries, the new order was challenged for its shortcomings. A new generation of leaders offered a second option.
Trump would "make America great again," going back to a time before the new order. Taxes would be cut. The growing political power of minorities would be reduced. Environmental controls on business would be slashed, because they are obstacles to wealth creation.
The U.S. would reject allies and alliances as having failed to produce results. The only international rules worth following are homemade.
Trump is no great theorist. His focus is self-promotion. To gain support, he chose to serve as the conduit for the political views of those who reject the post-war order.
He is not alone. The U.K. move to leave the EU and Turkey's move to reduce its NATO ties depart from the "liberal" view. Dictators, or at least authoritarians, displace democracy. The ruler of Hungary openly proclaims he is "illiberal."
If you were unhappy with the results of the "liberal world order," you wanted change. Whatever else Trump offered, it surely was change.
The third option is a different kind of change. Bernie Sanders in the U.S. and Jeremy Corbyn in the U.K. believe people reject a "liberal world order" that has produced inadequate public services, economic discrimination and unnecessary wars. Unlike Trump, their vision does not look back.
They believe the post-war order did not go far enough. If the "liberal order" gave freedom to corporations and left society under the control of the wealthy few, then they say it is time to give power to a truly democratic government in which each person counts the same.
The three choices lie just below the surface of the 2020 campaign.
Trump offers a continuation of the modern Republican program to reduce "political correctness" in favor of a more authoritarian government, less emphasis on minority rights, and less environmental regulation.
The Democrats are divided on the alternative to offer voters. Some want to erase the Trump presidency just as he has tried to erase the Obama presidency. They would return to the liberal order, while improving health care and fighting global warming.
Other Democrats respond to the demand for change and would repair the failures of the old order through greater common action led by government and financed by higher taxes on the wealthy. Though exaggerated, some label this "socialism."
This is not a routine election about who wins the impossible job of president. It is about making a major decision on where the country wants to go.
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