Jonathan Chait noticed something interesting, The Obama-Era Deficit Scolds Want Big Tax Cuts Now. He notes that all the big people behind Fix the Debt and other groups supposedly so concerned about the federal government’s debt are now only too happy to support Donald Trump and his idea of a huge debt-financed tax cut for the rich.

Oh, how can this be?! Could it possibly be that these people never cared about the debt? As Chait noted, “The debt scolds’ professed panic at looming fiscal insolvency turns out to be, in large measure, cover for a panic at a government that would redistribute too much income from people like themselves.” One would have to be Third Way columnist at a major daily newspaper to think otherwise. You know, someone like Thomas Friedman. But people don’t come around here to listen to such Very Serious Nonsense. So I think we can take this as a given.

No One Cares About Debt

The truth of the matter is that everyone can come up with reasons for debt-financed spending as long as they agree with the spending. Debt is not a problem. When people start worrying about debt burden, then I might take their concerns seriously. That’s the amount of money it costs us to pay for our debt.

All through Obama’s time in office, the cost of US government debt was extremely low. It was so low, in fact, that it was less than it was during George W Bush’s terms in office. In other words, debt was a much bigger concern when Bush was in the White House than when Obama was. Yet we heard very little about the federal debt during Bush and very much about it during Obama.

So it was always clear that the debt scolds were spouting nonsense. And I’m not just saying that now. You can go back and look at what I was writing over the last eight years — there is lots of complaining about this. But the truth is that as soon as a Democrat is in the White House, the debt scolds will be back.

Which Kind of Redistribution?

And the reason is because Democrats won’t increase the debt for things that the scolds want — like tax cuts. Democrats might increase the debt to provide healthcare for poor children! And that would be a bad thing because the debt scolds are committed to a single kind of redistribution: from the poor to the rich.

These are the same people who will tell you that there is nothing we could have done about our loss of manufacturing jobs. It’s just globalization — simple supply and demand — nothing to be done. Of course, even as these people fought to make sure manufacturing workers competed directly against workers in other countries, they were against the same thing happening to doctors, lawyers, and financial advisers.

Both of these things are related because they they shift wealth from the poor to the rich. But we don’t hear this discussed much in the press. We hear lots about how terrible debt is (when it might be spent on the poor). We hear about how great tax cuts on the wealthy are — economic growth! And we hear about how globalization lowers the price of paper towels. But we rarely hear about the good that can be done with debt. (No one blinks when they hear a friend has gone into debt to buy a house.) We never hear about how the professions of rich people are shielded from international competition. And we only hear about the bad parts of globalization except in the context of, “To bad we can’t do anything about it!”

The Real Fake News

I get so tired of hearing President Trump talk about fake news. He’s just lying, of course. But the truth is that our news is largely fake in that it pushes a narrative that is designed to help rich and powerful people like Trump.

So sure, the debt scolds are disingenuous. But why is it that our media outlets follow them in reporting on the subject of the debt. Do they not notice that when a Republican is in the White House all concern about the debt goes away? I’m not good at predicting the future, but I have no problem predicting this: if a Democrat is elected president in 2020, we will start seeing a lot more coverage about the federal debt and how catastrophic it is.

Over at Vox, David Roberts wrote, Exxon Researched Climate Science. Understood It. And Misled the Public. As you may have heard, a couple of years ago, some news outlets documented that Exxon scientists had studied global warming and found it to be true, but the company hid the information. They then spent a lot of money releasing information designed to muddy the waters and make people believe that it was all a hoax — or at least something that was uncertain.

Now, seventeen state attorneys general have gotten together to investigate whether Exxon broke any laws having to do with “racketeering, consumer protection, or investor protection.” That’s all good. Just the same, I suspect it will come to nothing. And even if it does, no one will go to jail. Instead, Exxon will be fined some amount of money that will be nothing compared to the money they made by deceiving the public.

Exxon Isn’t in the Business of Doing Good

There’s another issue here. Do we really look to our private companies to keep us safe? Isn’t the real villain in this case the Republican Party that has done everything it can to carry water for the dirty energy industry? These elected officials are supposed to look out for the interests of the county and its people, not its campaign contributors. And not the people who will give them cushy jobs when they leave office.

I have found that it is normally conservatives who are most upset when they find out that a private company like Exxon isn’t doing the “right” thing and is instead enriching itself by any means available. Liberals are rarely surprised by this kind of thing. And that explains to some extent why liberals are for government interference in the marketplace and conservatives are not.

In this case, I’m talking about conservative voters. Obviously, conservative politicians are about as vile and cynical as any group comes. But there is a great deal of naivete among conservative voters. These are, after all, the people who listened to Trump say daily through the campaign that he would repeal Obamacare, and yet thought that he wouldn’t really do it.

Naive Conservative vs Cynical Liberals? No

These naive conservatives will claim that my position is just cynical. I don’t have faith in my fellow man! But my position isn’t cynical; it is just fact-based. Private companies are in the business of making money. That means they will pay employees the lowest amount they can. That means they will charge the highest prices they can.

(This is another thing that drives me crazy. People think that companies set reasonable prices for things. This is not true. They charge as much as they can. It is only in a competitive market that various companies force each other to push the price down. I always hear this nonsense about “reasonable” pricing when it comes to corporate taxes. “If you tax them more, they’ll just raise their prices!” Really?! Then why aren’t they charging more now? Why do these people think McDonald’s is selling hamburgers for less than they could?)

Liberals Allow Conservatives to Exist

It often seems to me that conservatives can only exist because liberals allow them to. Without liberals to make society distinctly better, conservatives would be forced to see the dystopia that their policies actually create.

Thus there are really only two kinds of economic conservatives. First, there are the cynical people who only care about themselves and lording over everyone else. And second, there are naive people who live in a fantasy land where Exxon looks out for the best interests of the world. So economic conservatives really are stupid or evil. And I don’t know which is worse.

Chief White House strategist Steve Bannon has been fired — or as close to it as anyone in Washington gets. In other words, he will not be employed in the Trump administration anymore. And I’m sure that a lot of people are happy about this — especially liberals like myself. But I don’t much care — largely because it doesn’t much matter.

The truth of the matter is that Steve Bannon didn’t have much power in the White House. But who does? Watching what went on regarding the Charlottesville, Virginia Protest this last week shows this. On Saturday, Trump came out with a statement that cast blame widely. Trump condemned violence “on many sides.” He notably did not call out the neo-Nazis, KKK, and other white supremacists.

His advisers were very concerned about this, so they got him to read a prepared statement on Monday that mollified most people, even though even it was offensive. But Trump can only act like an adult for so long, and on Tuesday, he said things that made his remarks on Saturday look like something Abraham Lincoln said.

Trump Doesn’t Listen to His Advisers

Trump is immune to his advisers. The only thing that seems to affect what Trump thinks is Fox News. In fact, some reporting suggests that his advisers try to get on the racist fear-mongering network just so they can get his attention. So it doesn’t much matter who walks the halls of the White House.

That’s probably more true of Steve Bannon than anyone. Bannon is a vile person. But he had a number of ideas that were good. For example, he wanted Trump to propose a trillion dollar infrastructure bill. And Bannon wanted Trump to raise taxes on the rich. Sure: Bannon only cared about white people. But he did care about them. He wanted to help the white working class. And the truth is that infrastructure spending and taxing the rich would have helped the poor and middle classes of all races.

Steve Bannon Had Some Good Ideas

So Steve Bannon was a nationalist. But he offered both the good and the bad sides of that ideology. Trump, of course, only followed one half of Bannon’s ideology. And that was the bad side of it. So we got all the racism. We got all the belligerent talk. But there was nothing to offset it. The rest of it was the standard Republican platform: take from the poor and give to rich. Pollute on the poor to make the rich richer. Basically: do anything that will further enrich the rich.

What I find remarkable is that Steve Bannon is seen as worse than Trump. The only way you can think that is if you think the rich don’t have it good enough in this country. Steve Bannon actually offers beliefs that compensate for his vile nationalism and bigotry.

Trump Is Worse Than Bannon

It says a lot about our country that the mainstream press take it as a given that economic populism is bad. Note: economic populism is popular. Yet we all put up with a press consisting of upper class reporters pushing an upper class agenda.

I would take a Steve Bannon presidency before a Donald Trump presidency any day. This should be conventional wisdom. But sadly, if Donald Trump were more like Bannon — that is to say: less horrible — he probably wouldn’t have become president.

My fellow Americans: will you ever wake up?

This morning, Brian Beutler wrote History Will Remember the Republicans Who Appeased Trump. And he introduced me to the concept of “virtue signaling.”

This is where you indicate to other people that you are virtuous. Normally, virtue signaling is something that conservatives attack liberals for. If I write an article bemoaning the treatment of native Americans, I might be accused of virtue signaling because I’m not native American. But generally, the person who would make such a claim does it because they don’t care about native American rights and so can’t imagine that I really care about them either.

Paul Ryan’s Virtue Signaling

Beutler used the term in relation to Paul Ryan who has made statements against racism and white supremacy without linking them to Donald Trump or the Republican Party. For example, Ryan tweeted, “We must be clear. White supremacy is repulsive. This bigotry is counter to all this country stands for. There can be no moral ambiguity.”

In so doing, someone like David Duke can think, “He’s just signaling what a virtuous guy he is to the liberal press, but I know what he really thinks! He’s on my side!” This is a different take on virtue signaling. And it’s useful stuff. Let’s face it: Republicans are good at this.

The Power of Dog Whistles

In this form, virtue signaling is just a specialized form of dog whistling. I’m not saying that Republicans are the only ones who use it. But they’ve made an art of it. How else could they have been so successful electorally with policies that are so unpopular? A majority of Republicans are actually economically liberal. Think of the so called Reagan Revolution. All those people who voted for Reagan did so because of his social signaling — not his economic policies.

As a liberal, I know just how frustrating dog whistling is. Conservatives manage to imply the most offensive things. But if liberals call them out on it, the conservatives play naive.

Returning to Reagan, there is the “states’ rights” speech that was the first he gave after winning the Republican nomination in 1980. It was given right outside of Philadelphia, Mississippi. That was where three civil rights workers were murdered by Klan members in 1964. It’s obvious what Reagan was signaling to bigots: I’m on your side.

Of course, conservatives defend the speech to this day by saying that Reagan meant no such thing. It’s just us liberals who see racism in everything. That’s why dog whistles are so powerful.

Trivializing Language

But as a man who makes his living communicating with words, I find this pretense at naivete offensive. It asks us to pretend that language is simplistic — that it doesn’t have layers of meaning. And sadly, it is the moderates — those who are supposed to define what norms are (people like nightly network newscasters) — who allow Republicans to get away with this.

I don’t think for a minute that Paul Ryan thinks that his tweet is virtue signaling. But given that not offending Trump or his most vile supporters takes precedence over his hatred of racism, it does come off as facile. It is hard to think that he’s doing anything but virtue signaling. It is certainly true that the racists who think that are far closer to the truth than the “both sides do it” moderates who applaud such statements as though they were bold stands against racism.

The Rise of Virtue Signaling in Republicans

The reason that virtue signaling has not been a major part of the Republican lexicon is because it is only fairly recently that the party has gotten so far outside the mainstream that they’ve needed to. In the past, they didn’t really need to worry about alienating Pat Buchanan’s base. But now it is the Republican Party base itself. If you really think racism is a bad thing, you are not going to last long as a Republican politician.

Just the same, virtue signaling is one of the least powerful forms of dog whistling. And I wonder if the Republicans haven’t reached the point where they can’t manage the inherent contradictions in their party. If they have to polish every speech so that it is palatable to unabashed white separatists, it may be impossible to hang on to the latent racists that have so long been base of their party.

I remember reading an article several years ago where a guy said, “The worst thing about being a Republican was never being able to say what you actual thought.” That’s true. And it is only getting harder as their party slips into actual white supremacy and fascism.

At his press conference yesterday, President Trump got into a exchange with a reporter about slavery. He said, “George Washington was a slave owner, so will George Washington now lose his status? Are we going to take down statues of George Washington? How about Thomas Jefferson? Do you like him? Okay good, are we going to take the down the statue? Because he was a major slave owner. Are we going to take down his statue?”

Trump clearly thought that he was on top of it. He had an argument that no one could counter. Trump is at his worst when he’s smug. As is usually the case, he had nothing to be smug about. I feel kind of silly even bringing it up, but the argument for taking down Confederate statues has nothing to do with the fact that the figures owned slaves.

Yes, there are some people who think being a slave owner — at least one of the particularly repugnant American system — is enough to make them unworthy of honor. I’m more or less one of those people. I have incredible misgivings about Thomas Jefferson[1], for example. He’s a mixed bag and I really don’t think that the good outweighs the bad.

The Confederates Committed Treason

But none of that matters. It still makes sense to have Jefferson statues. He was, after all, our third president. He is part of the history of our country. Robert E Lee is a totally different case. Having a statue celebrating him is like having a statue celebrating Julius Rosenberg. Is it possible that half the nation, including the President of the United States, does not understand this?

Robert E Lee — just like all the other leaders of the Confederacy — was a traitor to his country. He committed treason to keep slavery alive.

The biggest mistake of the Civil War was how the north ended it. They wanted to heal the wounds. As a result, no one was tried for treason. So within a decade, pretty much all of these southern traitors got their old lives back. And what did we get? Generations of southerns who act like they were the ones who were wronged.

Confederate Monuments Are Jim Crow Vestiges

But the situation is worse than that. The vast majority of these Confederate monuments were not erected directly following the Civil War. Instead, they were erected as part of Jim Crow — as a way to put people in their place — and most of all to say that the Confederacy might have lost the war but it wasn’t wrong.

I see Confederate monuments as a sign of arrested development. It’s been over 150 years since the Civil War. The world has made revolutionary changes in that time. But we still have certain sad people who just can’t get over that war. And it is impossible to not see that what they are really pining for is the days when white people could own black people. Those days are not coming back, but these Confederation lovers just can’t let go.

The American Sickness

And now, the sickness has really gone mainstream. We have a president who celebrates treason. In the end, did Julius Rosenberg really do much damage to the United States? Certainly not in comparison to the damage that Robert E Lee did.

I am disgusted by all this. We shouldn’t be having a conversation about Confederate monuments. We should be shamefully removing them at night. There is no more argument about this than that Jews are subhuman and deserve to be destroyed. And the fact that half the country thinks there is an argument shows that we have a terrible sickness. And it is one that will destroy us if we don’t cure it.

Update

I see that Matt Yglesias made much the same point, The Huge Problem With Comparing Lee and Davis to Washington and Jefferson. But he made an excellent point that I hadn’t thought of:

His main point is that people like Thomas Jefferson for the good things he did. They like Lee because of the bad things he did.

[1] To see what a charmer Jefferson was, check out Jefferson’s Declaration of “Merciless Indian Savages” and Thomas Jefferson’s Entitlement

We were having a conversation about Vox Media in the comments and someone sent me a very interesting article, How SB Nation Profits Off an Army of Exploited Workers. It’s long and deeply reported. I recommend checking it out. But I wanted to discuss it in a general sense: how companies manage to exploit free labor.

Rewards Don’t Follow Contribution

One of my main interests in economics is how rewards don’t go to those who do the best or most important work. Instead, rewards go to those who just happen to make a contribution at the right time. Any major innovation is the result of countless people working over variable time scales. But if you are unlucky enough to add to the innovation at a point when it can’t be monetized, you are largely out of luck.

What is going on with many internet companies is similar to this. Since most people weren’t on the internet in the 1980s, let me explain what it was like. Because it was something of a small community made up of relatively affluent people, there was great altruism. (It’s easier to be altruistic if you aren’t worried about making the rent.) People created software and just gave it away, for example.

Now, this is still true of the internet. The difference is that there are so many people trying to make a profit off all this free work. And note: it wasn’t just software. I remember in the early 90s, there was this guy on rec.arts.startrek.tng who each week wrote a narrative summary of the new Star Trek: The Next Generation episode in addition to a surprisingly deep analysis of it. He did it for no reason other than that he was a fan and wanted to share it. He got lots of positive feedback as well, of course.

SB Nation Steals From Creators

And that’s kind of how SB Nation works. It started with sports fan blogs. Tyler Bleszinski and Markos Moulitsas looked at this and said: light bulb! Just as DailyKos had been very successful that leveraging people’s natural tendency to want to share their political beliefs, SB Nation would leverage the same thing for sports. And it’s amazing how successful a company can be when all it does is sell work that people do for free.

If we lived in a rational society that hadn’t been fed capitalist propaganda from before living memory, we would see this for what it is: stealing. But trust me: I know what the capitalist apologist will say, “But these people had the brilliant idea of leveraging all this free work. Besides, no one is forcing these people to write for SB Nation!”

You can say the same thing for stealing, “But I had the idea of stealing that car you never use. Besides, it’s not like you need it!” The idea of economic systems is that they are supposed to distribute resources. Capitalism does a really bad job of this. It rewards the very worst aspects of human behavior.

And note: I’m not saying that distribution is valueless. It’s like banking. Bankers should make money for distributing capital to where it ought to go. But when you find that 40 percent of your economy is tied up in finance (as it was before the crash of 2008), then you know that something is wrong. And in the case of SB Nation, something is clearly wrong: their outlay for all their fan sites is in the low single digits of millions of dollars for a billion dollar company.

The Failure of Capitalism

My concern isn’t about SB Nation particularly. It is rather that we all accept the idea that those who are rewarded in our economy are not those who really create things. We accept, without thinking, that there is nothing wrong with the SB Nation model.

All of this brings us back to the “gig economy.” It is the polar opposite of the union economy. Businesses love it because they not only don’t have to deal with the combined power of labor, they don’t even have to worry that any union will be created. Those people at SB Nation who do get paid (extremely poorly — like $600/month for a site editor, which is a full-time position) are independent contractors.

Every time I bring these kinds of issues up, I get push-back from people. First they point out that the Soviet Union failed. Well first, I’m not proposing the Soviet Union as a system. But let’s assume I was. The truth is that people did much better under the Soviet Union than they did under the tsars. And I can’t say that they have done better since. So this idea that the Soviet Union was a failure is mostly just western dogma that few people take the time to think about. They just know.

Then they talk about all the great things capitalism has brought us. This I find bizarre. People get blinded by shiny objects. As Ha-Joon Chang pointed out in 23 Things They Don’t Tell You About Capitalism, the washing machine had a far more profound effect on our lives than the computer. So it’s ridiculous to think that unless we have people starving in the streets we won’t have iPhones.

Demand a Better System

So we could have a better economic system. We could have a system that more closely matches reward with contribution. (Note: I am not calling for a meritocratic economic system; I’m just noting that it would be better than what we have.) But such a system would never have the kind of economic inequality that the power elites now believe is their right. And the rest of us will never call for it as long as we are blinded by the idea our weird form of capitalism is an unquestioned good.

The Democrats have released a program to make all our lives better called A Better Deal. And there is much in it to like. But I think I can be forgiven for being a tad skeptical about it.

As part of it’s release late last month, Chuck Schumer wrote an op-ed in The New York Times, A Better Deal for American Workers. At the beginning was some language that sounds, well, familiar, “There used to be a basic bargain in this country that if you worked hard and played by the rules, you could own a home, afford a car, put your kids through college and take a modest vacation every year while putting enough away for a comfortable retirement.”

That’s taken right from Obama’s 2008 stump speech. And I just wonder: after 8 years of Obama supposedly trying to make that happen, the country choose as it’s president an incompetent bigot? Regardless, we sit here 9 years later still thinking back on that basic bargain. Now there’s a real question as to whether this bargain ever existed. It certainly didn’t for a huge percentage of the population. Just the same, I don’t think there is any reason that we couldn’t make it true today.

Mushy Thinking in A Better Deal

Looking at A Better Deal itself shows that it is a mixed bag. For example, it doesn’t call for a $15 minimum wage. Instead, we get this, “As part of the Better Deal, many Democrats are calling to increase the minimum wage to $15 an hour and have cosponsored the legislation to make that happen.” I don’t know what that means. It sounds a lot like: as part of Obamacare, many Democrats are calling for a public option. You all know what happened to the public option: it was killed by conservative Democrats — most of whom go voted out anyway.

But what most upset me was the third part of A Better Deal, “Build an economy that gives working Americans the tools to succeed in the 21st Century.” The summary starts:

Two Problems

Get that?! There are two major problems here. The first is that this is the same old stalling tactic that we’ve been fed for decades. The unstated assumption here is that companies are not hiring because workers don’t have the right skills. Now to start with, the unemployment rate is 4.3 percent right now. The truth is that there is no skills mismatch. American workers are qualified for the jobs that exist. Saying they need “skills” is just a way of doing nothing. And if wages are down, that isn’t because of a lack of skills. How about the Democratic Party standing up for unions?

That all is bad enough. But the idea that workers lack skills and so we should give money to corporations is insulting. Do the Democrats want to see Trump have two terms as president? This is madness!

So to summarize: the Democrats think that Americans need more job training (which they don’t) and they think corporations should be given the money to do this useless job training.

Better Than Nothing

The rest of the proposal looks okay, but it isn’t as clear as it could be. We Democrats seem to be incapable of that. And some things hearken back to Obama, like reducing the price of prescription medication. Yeah, that’s something we were talking about in 2008. It seems like we could have done something about that. It seems like we could have done something about the big drug company giveaway that is Medicare Part D.

But I suppose we should give the Democrats some credit. They seem to be waking up to the need for a turn away from the road that led from Bill Clinton and NAFTA to Barack Obama and the Trans-Pacific Partnership.

Afterword

People bring up a lot of reasons why Hillary Clinton lost the last election. I wonder if having Obama running around pushing the TPP wasn’t also a drag on her campaign. It certainly reinforced the idea that Clinton was against the TPP now but that she would be for it once in office.