I have long thought that Watergate backfired on liberals. Pretty much any Republican malfeasance harms liberalism because it harms the idea that government can be a force for good. I’ve become really frustrated with what I see as casual cynicism: the idea that everyone is out for their own gain and no one is any damned good. This is implicit in the “both side do it” argumentation so loved by the mainstream media.

Yesterday, Matt Yglesias pointed out an excellent example from Ron Fournier where he complained that Obamacare was “a one-sided law.” So if Republicans explicitly boycott a law because it will provide political benefit to the president, both sides are equally at fault. Similarly, Dean Baker pointed out, “Robert Samuelson does the old ‘pox on both your houses’ routine, complaining about Republicans who want tax cuts for rich people and Democrats who defend Social Security and Medicare.” All of this pushes the idea that government is corrupt and there are no good politicians. And what that means is that the Republicans win, because that is the idea that they are pushing.

There is no doubt that this has been a major issue since Nixon. But there is another issue that was brought up in a Thomas Frank interview with Rick Perlstein, How ’70s and ’80s Cynicism Poisoned Democrats and America. In it, Perlstein brought up a major change in the kind of Democrats who got elected in 1974. It was kind of the start of the New Democrats. I’ve discussed this in the past to the extent that I refer to Jimmy Carter as the proto-New Democrat. He was, after all, the guy that really started the deregulation frenzy, rolled back Nixon’s policy of detente with the Soviet Union, and pushed forward debt fixation. But I always thought that he was something of a singularity. Not so:

And that means that liberal — Populist! — economic policy was largely dropped. Hart and company didn’t argue against the conservative economic policies of the Republicans. In fact, they largely agreed with them. Later in the interview, Perlstein noted, “And a lot of these post-New Deal Democrats, by the way, come out of the New Left and the New Left had this very problematic relationship with the labor movement, who were seen as sort of the Cold War consensus.” This has long been a problem with our new upper and upper middle class political establishment. They have no real experience with the working class. And this is why Republicans — even while being horrible for workers on a practical level — have managed to paint Democrats as a Tax-Raising, Latte-Drinking, Sushi-Eating, Volvo-Driving, New York Times-Reading, Body-Piercing, Hollywood-Loving, Left-Wing Freak Show.

The big problem with this is not just that Democrats elect nothing but conservative presidents like Carter, Clinton, and Obama. The problem is apparent in the fact that the Republicans claim these conservatives are leftist extremists. And that allows people like Ron Fournier and Robert Samuelson to define a new liberalism that is far to the right of Nixon. By abandoning liberal economic policy, the Democrats have not only directly harmed the American middle class, they have also made any real discussion of change impossible. Now even the most traditional of economic policies are met with cries of, “Socialism!”

This is why I see the primary problem in American politics as being centered around the Democratic Party. If we want a more reasonable conservative movement and Republican Party, the solution is for the Democratic Party to move to the left on economic policy. But the sort of people in the media who are always looking for compromise and occasionally fretting about the extremism of the Republican Party always call for exactly what caused our current problems. Fournier thinks that there is some magic trick whereby if Democrats just move the right amount to the right in the right way, the Republicans will move the left and we will all sing “Kumbaya”! But just the opposite has happened and will continue to happen. When the Democrats move one step toward the Republicans, the Republicans move two steps away. And it is only studied ignorance that allows pundits to not see this.

Consistency is a laudable goal, but not something to get too hung up on. I very much agree with Ralph Waldo Emerson, “A foolish consistency is the hobgoblin of little minds…” Just the same, some level of consistency is important. At very least, the attempt keeps us intellectually honest, because one can only finesse an argument so far before it crumbles. In the field of politics, we see inconsistency in the form of hypocrisy — and hypocrisy of the most premeditated nature.

My favorite example of this is Obamacare. As Scott Lemieux noted early this year, Obamacare is not the same as the Heritage Foundation plan. But the one main thing the two plans share is the most hated thing in Obamacare: the individual mandate. And as late as John McCain’s 2008 campaign for president, Republicans were fine with the individual mandate. But the moment it was in the Democrats’ plan, it because, “Socialism! Socialism, I tell you!” This is not a foolish inconsistency; this is a profound and disingenuous inconsistency — the stuff of villainy.

So I was interested but not at all surprised to read Jonathan Chait this morning, Why Is This Bush Official Flip-Flopping on Obamacare? Simple answer: because he’s a Republican. The person in question is the president of the American Health Policy Institute, Tevi Troy. In 2007 — you know, when a Republican was in the White House — he wanted to tax the so called Cadillac healthcare plans — those worth over $15,000 per years. But yesterday over at The Wall Street Journal, he wrote, Another ObamaCare Deception. The whole article is about how the Obamacare tax on employer provided health insurance above $27,500 would be — Wait for it! — a tax!

So when Republicans are in the White House, a tax on plans worth more than $15,000 is just good sense. But when Democrats are in the White House, a tax on plans worth more than $27,500 is going to impoverish the American worker. Clearly, this is just more Obamacare punching. If it’s in Obamacare, Republicans hate it, regardless of what they thought before. Notice that the Cadillac tax has always been greatly loved by Republicans because it is another way to harm union workers. Only people in strong unions (and managers, who will just vote themselves raises to offset it anyway) get these kinds of plans. It show the lengths to which Republicans will go to attack the new healthcare law.

As I said, this is not a surprise. If you burrow down deeply into conservative ideology, what you will find is… nothing. That explains the obsession with purity — it is all they have. This is the reason that there has been no replacement plan. Their’s is an ideology of annihilation. They hate Obamacare not because of what it does but simply because it does anything. We saw much the same thing with the Republican response to Hurricane Katrina. President Bush seemed to treat it the way the cargo cultists did when trying to get the airplanes to come back. He seemed to think that all that was necessary was for him to drop by and look at the damage (From a plane!) and he was done. He had cast his spell!

When Republicans are in power, they are incompetent. When they are not in power, they are against everything. They are, in a word, nihilists. The problem is that they won’t admit it. And that is why they can’t help but contradict themselves from administration to administration.

This morning, Jon Swaine reported Ferguson: Video Shows Darren Wilson Arresting Man for Recording Him. Wilson, of course, is the Ferguson police office who shot and killed Michael Brown. You know: the man who is soon to be officially not indicted because police officers are never held accountable? Based upon conflicts between the video and what Wilson actually said in his report, many are questioning if Wilson can be trusted in what he says about the Michael Brown shooting. I have a slightly different take on it, but first, let’s go over what is going on with this video.

Just over a year ago, Officer Wilson came to the home of Mike Arman to deal with a citation regarding “derelict vehicles” on the property. Arman wanted to record the encounter. Wilson apparently thought that the video recording was verboten, because we live in a police state. He told Arman to stop photographing him, “If you wanna take a picture of me one more time, I’m gonna lock your ass up.” And then Wilson arrested him for “failing to comply” with Wilson’s orders. Subsequently, the charge was dropped.

I think that the incident shows what we already know about police in general and Darren Wilson in particular. They all think that everyone should bow down before them. They are jerks. The law doesn’t matter. If they don’t want you recording an incident, they will arrest you. The worst that will happen is that the charges will be dropped. And that means that the innocent civilian who was simply exercising his constitutional rights was punished for it. Meanwhile, nothing happens to the officer, except that he learns that he can do anything he wants — often including killing people — and there are no consequences.

What has been clear from the very beginning is that Darren Wilson has an attitude toward those who he polices. Conflicts are not going to be de-escalated; he is going to make situations worse. It seems that he was trained that way in his first job with the police department in Jennings, Missouri. According to the Washington Post, “What he found in Jennings, however, was a mainly white department mired in controversy and notorious for its fraught relationship with residents, especially the African American majority.” It doesn’t seem that anything has changed.

My experiences with the police — both personally and what I’ve observed — is that they always treat people with barely disguised hostility. A lot of it is that they’ve all convinced themselves that their jobs are really dangerous. They don’t, but that’s what they’ve convinced themselves. This is why they act like pussies, using clubs, tasers, and guns at the slightest provocation. But in addition to that, they are insular groups who spend far too much time together and far too little time in the great big world. So they understandably develop an “us versus them” mentality.

What is not understandable is why the departments don’t do more outreach and training. Instead, we have to wait for things like the Michael Brown shooting, even though it was clear last year that Wilson was a tinderbox waiting to explode. Consider the encounter with Mike Arman. Wilson was just there on a citation — the equivalent of a parking ticket. But he apparently didn’t feel that Arman was giving him enough respect. So he arrested him. That isn’t the behavior of a professional government official. That’s the behavior of a thug. We didn’t need the death of Michael Brown to know that.

For years I’ve been grappling with a question. How is it that technology and infrastructure affect the amount of money a business owner makes. According to most people on the right, a person’s or company’s value is exactly (or very nearly so) based on the amount of money they make. But think about a man who makes hammers. If he lives in 1750, it doesn’t matter how cheaply and quickly he can make hammers, there will be distinct limits on the number that he can sell because of distributional limitations. But this same man living today would have almost no limitations and so could make vastly more money. What’s more, because he was selling so many more hammers, there are various scaling effects that would also bring his costs down and his profits up.

This example highlights the fact that the man is not necessarily making what he is worth. The modern hammer maker is paid more not because of anything he is doing but simply because of the existing technology and infrastructure that he was gifted. The greater profits are therefore not due to individual achievement, and therefore should not go to the individual — at very least, not entirely. This strikes me as a devastating argument and so I’ve wondered why I don’t hear economists making it. But I figured it had to be floating around.

I think the reason the argument isn’t more widely discussed is because it is easier to simply assume an economy without Sam Walton and then compare it to the economy with Sam Walton. The difference is what Sam Walton is worth. It is much more complicated to consider what actual value he adds. To me, it is as simple as considering one of the most basic economic ideas: the opportunity cost. The question is not how much Walmart adds to the economy, but how much Walmart adds to the economy compare to other options.

Consider the world of classical music. What if the best violinist in the world had never been born. He makes millions of dollars. Would all those CDs not be sold? Would all those concerts not occur? No. Instead, the second-best violinist would have a better career. And the world would be negligibly worse off, because the difference in ability between and the best and the second-best is razor thin. If you want it quantified, consider the 100 meter run: if Usain Bolt had never been born, the world record would be 9.69 instead of 9.58 and Yohan Blake would be doing those Puma commercials.

I have found someone who is talking about this kind of stuff. Recently, Dietz Vollrath wrote, Scale, Profits, and Inequality. His primary interest is in regard to taxation and its effects on innovation. As you know, I think most arguments about innovation are just cons. The idea that people innovate in order to make billions of dollars defies human psychology. Everyone wants to make money, but billions of dollars is out of the range of normal thinking. And regardless, no one considers how much their marginal tax rate will go up before creating something new. “I was going to invent a cold fusion reactor, but then they raised the top tax bracket to 39.6% and I said, ‘No, no, no!'” What rubbish.

Vollrath noted that the quantity of a product sold “depends on the aggregate size of the economy.” He continued:

I would go further, of course. I think that the “genius factor” is greatly over-prized. It too is constrained by social factors. For example, Linus Torvalds’ genius was entirely dependent on the genius of Richard Stallman and the creative environment he established. I’ve always found Stallman to be a rare singularity in the history of innovation because he is so idiosyncratic. There is no question but that Torvalds is brilliant, but eventually some programmer was going to do what he did; I’m not as certain about that when it comes to Stallman. Regardless, people like Jobbs and Walton were not singularities.

This issue is more difficult to argue. What isn’t difficult to argue is that when Sam Walton was computerizing his distribution system he was not thinking, “This is worth doing because long after I’m dead my family will have more money than they could ever spend!” But even if he had been thinking this, all he was doing was harnessing a collective resource that our current system allows to be taken entirely as individual profit. Vollrath noted:

The reason we don’t see more of this kind of thinking is that macroeconomics is largely apologetics. (See Economic Apologetics and The Myth of the NAIRU and Its Purpose.) Ideas that push against the interests of the powerful are ignored or held to ridiculously high standards of proof. Ideas that flatter and enrich the powerful are true until proved otherwise. But I’m glad that there are economists out in the world that are talking about issues like scale effects. I will continue to look for more.

I know that I have fairly negative feelings about the following list of countries: China, Iran, Iraq, and Saudi Arabia. It’s not that I hate them — not at all. But I think a whole lot worse of them than I do, say: Germany, France, Italy, and the United Kingdom. I’m sure there are a lot of things that go into this. I associate all of these countries with authoritarian governments, even if Iraq is now technically a democracy. But mostly, they strike was as kind of Old Testament in their outlook on life. This isn’t necessarily fair, but certainly a case can be made.

So I wasn’t terribly pleased when I saw this recent Amnesty International report, Death Sentences and Executions 2013 (pdf). You see, the top five countries for the death penalty are these Abrahamic countries and, of course, the “enlightened” United States of America. It makes me want to break out in song, “Oh, say can you see: all the people we kill?!” But I guess we can take some comfort that we are fifth on the list! For once we aren’t “Number one!” on a list of bad things.

Here is a great graph that Business Insider put together to illustrate the situation, China Executes More People Than The Rest of the World Combined:

There is good and bad news about this. The good news is that executions are down in the United States. Fifteen years ago, we executed 98 people. The bad news is that maybe we would have ranked higher before. But even with our reduction in executions, we are still a major outlier. We are the only nation in North or South America to carry out executions. Think about that. All those supposed backward people down south still manage to avoid executing anyone. We make up roughly one-third of the population of the two continents, but we killed 39 and they killed zero. Also, “The USA was the only country of the 56 member states of the Organization for Security and Co-operation in Europe to have carried out executions.” Are we not proud?

One interesting statistic is that between 2012 and 2013, the number of nations executing people went down slightly. But the number of executions went way up: by 12%. I think executions can be seen as a kind of contagion. Clearly, executions are not a rational response to violence or crime. It reminds me of the response to “Typhoid” Mary Mallon. She was locked up even while other typhoid carriers were not. She was locked up as a kind of public relations effort — to make people feel better about the disease. And that’s largely how the death penalty in the United States works: it doesn’t make anyone safer, but it shows that the government takes murder seriously — even if the government doesn’t take it seriously.

It’s all pathetic. But it does drive home an important point. When we think about our country, we shouldn’t compare it to other advanced economies with democratic governments. We should think of our real peers: China, Iran, Iraq, and Saudi Arabia. Next to them, we really do stand out like a shining city on a hill. Compared to Germany, France, Italy, and the United Kingdom, we really don’t. So let’s embrace our Iron Age culture. We’re one of the best!

I was talking to my father the other day about Obamacare. He is a fairly typical conservative in that his opinions change like a pinball. Sometimes he is quite liberal, but let Fox News work on him for a few minutes and he’ll reverse course. In fact, I can generally determine what it is that Fox News is pushing by the changes in his opinions. About a year ago, out of the blue, he decided that Obamacare was too complicated. Why oh why couldn’t we just have had a simple law like Medicare for all?! He didn’t put it quite that way, but that was the substance of it. I told him the truth: because conservatives like him wouldn’t stand for such a law; Obamacare was an attempt for liberals to get along with conservatives; and the liberals got paid back with fake outrage about the bill being some kind of socialist plot. I did not mention that liberals also got paid back by conservatives like him complaining that the law was too complicated and claiming that they would have been just find with a single-payer system.

Up until last week, my father seemed to have made peace with the new healthcare law. But such acceptance could not withstand the 57 segments that Fox News did this week on Jonathan Gruber’s statement about the law being designed so the CBO didn’t score it as tax. According to Fox News that meant that the Democrats had lied to the American people. It’s very annoying, because the entire right wing echo chamber is being disingenuous. Did we not talk for years about the tax penalties for people not getting insurance? What exactly did the Democrats slip by us?

So Fox News is all over this and now my father thinks that Obamacare is some kind of secret plot to get everyone dependent upon the government. I find the whole thing exhausting. And this is why I don’t much talk to my father about politics. It isn’t that I can’t convince him of things. But the one hour of Fox News he watches each day would require that I spend at least two hours every day to counter. The truth of the matter is that Fox News is very good at what it does. The hosts and producers know all my father’s prejudices and they feed him disinformation based on it. Watching Fox News is the intellectual and emotional equivalent of slipping into a warm bath.

Meanwhile, there are actual facts about Obamacare. In addition to all the active disinformation, Fox News acts as a kind of information filter. If there is bad news about the law, it will be reported on Fox News — and often. But if there is good news about it, it simply won’t be reported except in passing at the beginning of Special Report with Bret Baier (the show my father watches). It certainly won’t be discussed by the “Fox All-Star Panel.” And we had some good news on Obamacare yesterday.

Frank Newport at Gallup reported, Newly Insured Through Exchanges Give Coverage Good Marks. A recent poll found that people getting insurance on the new exchanges are roughly as happy with their coverage and price as people getting it through their employers. Of the newly insured, 71% rated their coverage good or excellent — compared to 72% of everyone who is insured. But you won’t be hearing about that on Fox News.

It is much easier to rant about how the American people were lied to and that the evil liberals are trying to make everyone dependent upon the government. My father is almost 82 years old. You know: the typical Fox News viewer. And he sees himself as fiercely independent. Of course, he is entirely dependent on the government. He is on Social Security, with very little personal savings. And he gets his healthcare from the VA who take amazingly good care of him. But government dependence is terrible! For other people. Apparently. Because that’s what Charles Krauthammer and George Will and Fred Barnes tell him on Fox News.

Last year, I wrote about a 60 Minutes segment that investigated disability fraud. It was an amazing thing to watch, because in the old days, the show went after powerful people. Now it is primarily a rage program. It ought to be on Fox News. The segment focused on poor people living in economically devastated areas using the program to make ends meet. Certainly we don’t want them doing this but it is a sign of the desperation of the times. But apparently the oligarch apologists can’t be bothered to do stories about government officials at every level doing everything they can to stifle the economy.

I noted at the time that the bad thing about the fraud hysteria is that by making it harder to get disability, more people who ought to get it will be denied. So just how big a problem is disability fraud? According to Associated Press, there has been $2 billion of fraud in the last seven years. That sounds like a lot of money, but it really isn’t. Dean Baker noted this morning that it represents just over 0.2% of the entire outlay of benefits.

Conservatives, of course, will claim that no level of fraud is acceptable. But that’s just stupid. There will always be crime — the vast majority of it never solved. Does that mean we should just stop living? Baker pointed out that it would make no sense to spend $10 billion to stop $2 billion in fraud. As long as fraud is minor, it is acceptable.

One of the annoying things about these reports is that they imply that such fraud doesn’t exist in the “perfect” private sector. But that just isn’t true. According to Blue Cross Blue Shield, fraud may cost the healthcare industry $200 billion per year. This number is almost certainly greatly inflated. But it shows that the private sector deals with fraud and some level of fraud is acceptable. It is all about the costs of fighting it.

Another example is shoplifting at Walmart. The company supposedly loses $3 billion per year from theft. They do what they can to minimize theft. But what they don’t do is try to completely eliminate it. They could, for example, require that everyone leaving the store submit to a strip-search. Clearly that would be both effective in eliminating theft and catastrophic to the company’s bottom line.

But none of this kind of reasoning seems to come up in discussions about fraud in government programs. Part of the problem is that private companies don’t make that big a deal out of the theft that effects them. But more important, when it is the government, the press makes it out as a big deal. You know: because it is our money that is getting stolen. But that’s also true of private sector healthcare fraud and shoplifting at Walmart. That theft causes prices to go up. So this razor focus on the minor imperfections of government programs is just an anti-government double standard.

Dean Baker is right that Associated Press never would have written such a story with the relative values. “Disability Program Defrauded of 0.2% of Outlays” just isn’t an exciting headline. But it’s another matter with, “IG: $2B in Disability Claims Approved by Mistake.” As noted, that $2 billion figure is for seven years, so even it is deceptive. Why not a big headline, “Walmart Losses $21 Billion to Theft Increasing Price of Toilet Paper”?

What’s most frustrating is that the article is presented as simple objective reporting. But it is rich in political significance. Like the 60 Minutes segment last year, the implication is that the disability program is rotten to the core. But neither report made any mention of the size of the program nor the relative size of the problem. Although the reporters involved probably have little idea, they are working as propagandists for anti-government activists who want to destroy the program for entirely different reasons.

And the result will be that poor people get harmed. According to the Associated Press article, “The average monthly benefit for a disabled worker is $1,146.” This is from a media establishment that can’t get worked up about billions of dollars in fraud committed by the world’s largest banks. But when a poor person is getting less than $14,000 per year, well, that’s an outrage!

Matt Yglesias wrote a great article at Vox today, The NAIRU, Explained: Why Economists Don’t Want Unemployment to Drop Too Low. I know it sounds very technical and boring, but it isn’t. It is about the Federal Reserve and how economists have spent the last 40 years doing everything they can to enrich the rich and impoverish the poor.

NAIRU is an acronym for “Non-Accelerating Inflation Rate of Unemployment.” It is supposedly the unemployment rate at which inflation will be flat. If unemployment gets below that level: inflation will take off. The problem with it is that, like much in economics, it doesn’t have much in the way of empirical evidence to support it. So why does everyone believe it? Simple: it provides a justification for keeping unemployment at a high enough level where workers have little leverage. It is a big part of the reason why workers have seen almost no share of productivity gains over the last 35 years.

What we’ve seen since the early 1980s onward is that inflation has remained low — most of the time, too low. And this is because the Federal Reserve has always prioritizes attacking even the threat of inflation above stopping actual job losses. You see, there is no doubt that there is a relationship between inflation and employment. In the late 1950s, William Phillips showed that inflation and employment were inversely related. High levels of employment tended to cause inflation, and vice versa.

This graph is for the 1960s, but the graph for the century before that looks pretty much the same. What I find most interesting about this is that to me, the sweet spot on the graph would be an unemployment rate of less than 4% with an inflation rate of 3%. But the Fed — and most other central banks — are obsessed with a 2% inflation target, which they generally think is compatible with a 5-6% unemployment rate. That’s an extra 2-3 million unemployed people, just so the rich don’t have to worry about even a hint of inflation. And it just so happens to keep wages low. It’s good to be rich.

With just the Phillips Curve alone, there might be some pressure on policymakers. But instead, there is this whole “rational expectations” theory behind it that basically says that even allowing inflation won’t help employment. So the Fed may have a dual mandate to minimize inflation and unemployment, but in practice it has a single mandate to minimize inflation and let the American worker starve as he may.

Yglesias pointed out that even if you accept the NAIRU, the Fed has consistently kept unemployment above it. Other than at the end of the 1990s, periods of time where the unemployment rate was below the NAIRU were brief and shallow. And even during that 1990s period, there was no increase in inflation. I would have thought this would mean that economists would throw away the NAIRU or at least recalibrate it to allow for a lower target unemployment. But no. Instead, they seem to have just convinced themselves that the late 1990s was a special case. And this is why the Fed currently is on the verge of raising interest rates. Because employment is doing so great. (Note: sarcasm!)

What’s so frustrating about this is that it would never work the other way. If there was sketchy evidence for allowing inflation of 5%, it would not be economic dogma. It is only economic dogma when it just so happens to benefit the power elite. I have begun to see economics as a kind of theology. What economists primarily do is apologetics: justifying established dogma. It’s not that they aren’t smart guys. Theologian are smart too. But that doesn’t make them right.

In the past, there have been whole classes of people whose job it was to justify the power of church. We have the same situation now — just with a different power center. The economists use math to show that the power elite really do deserve what they have — and more. And so we’ve had anti-union and anti-inflation policies for the last several decades. We are told this is necessary so we can all have nice things. But it is all about justifying taking what should be the nice things from the poor and giving them to the rich. And it is done in the name of “Science!” Economics isn’t a science. It is a conspiracy of the rich.