Category Archives: US

Smarter ducks

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Over on the New York Times economix blog, an argument for high taxation and robust government spending using data from, of all places, the Republican-supporting Heritage Foundation in response to those who think that those who pay low taxes are ‘lucky duckies.’ As an example of the cute analysis:

Equatorial Guinea: According to the Republican-leaning Heritage Foundation, those who live in this small country in sub-Saharan Africa are lucky duckies indeed. Because of recently discovered oil deposits, the citizens of Equatorial Guinea pay less than 1 percent of the gross domestic product in taxes. The comparable figure for the United States is 26.9 percent of G.D.P., according to Heritage.

However, Equatorial Guinea doesn’t seem to be a very pleasant place to live. The people are poor and have little freedom. Heritage says that “persistent institutional weaknesses impede creation of a more vibrant private sector” and “the rule of law is weak.” This sounds suspiciously as if government is too small to do its job properly. But I’m sure that the citizens of Equatorial Guinea don’t mind having a dysfunctional government; after all, they’re lucky duckies.

Perhaps the most interesting part of this short piece – one of the clearest, quickest arguments for the idea that working markets requires a strong, effective government – is that it comes from Bruce Bartlett, a former policy advisor to Reagan, Bush Sr., and Ron Paul. It demonstrates that even someone who has worked with a headstrong libertarian type sees the need for effective government presence in any good society.

The conclusion of his article demonstrates another point however. Bartlett believes that high taxes and low regulation (like Denmark) are preferable to lower taxes and less ‘business freedom.’ So it’s worth keeping mind that, even convincing people that government is important and necessary to a functioning economy doesn’t mean they’ll be convinced that it should be on the side of a functioning society. Still, if you can lead a duck to water…

Dr. Pepper is hurting America

politics, poverty, US, , , , , , , , , ,

One could call a recent episode, in which the employees at a Mott’s factory in upstate New York’s Williamson face a $1.50 an hour pay cut combined with other benefits reductions just another day in the continued American slide toward inequality. Yet as noted by New York Times writer Steve Greenhouse, the strike is interesting because the concessions are being demanded at at time when the parent company, The Dr. Pepper Snapple Group, is showing healthy profits.

As noted by Leo Casey over at Dissent Magazine’s blog, there’s nothing new about the race to the bottom which has undermined middle class incomes over the past 40 years. Wages for the bottom 90% of the American workers have stagnated for the last 30 years, at the expense of the wages of the top 10%. That’s 20 years of growth for which all of the benefits have flowed to society’s richest.

There is no reasonable argument that this is fair – data shows that the change can’t be attributed to growing gaps in educational attainment.

Besides fairness, however, there is growing understanding, backed up by evidence and theory, that inequality is a large part of what caused the financial crisis.  Former chief economist at the IMF Simon Johnson lays out arguments to that effect from Robert Reich and Raghuram Rajan, no economic slouches themselves. While admitting the long term fiscal problems faced by the United States, Johnson points out that the immeditate causes of the fiscal crunch was paying for the financial crisis – one facilitated by 30 years of growing inequality.

Johnson’s argument is about the implications of this understanding for US fiscal policy, but it also provides a useful perspective on the Mott’s strike. A recent book from Richard Wilkinson and Kate Pickett (you can read a defence against their critics here) has demonstrated the almost unbelievable numer of ways in which equality improves the lives of whole societies (that is, not just the poor); the work of Johnson, Rajan and Reich simply adds another reason to realize that the US has far from crossed the line from reasonable into irresponsible.

Some public advocacy groups have taken a hard tack on inequality, yet public awareness on the causes of inequality have as of yet gained much less traction, and policy responses seem focused on tax measures alone. It is all well and good to focus on individuals and their earnings, but ultimately distribution is a result as much, if not more, of the regulation of the market as it is of post-income readjustment. The Mott’s strike demonstrates just one of the myriad ways in which corporations – empowered and informed by legal rules and government policies – are allowed to increase their share of the total economic pie. It is this wealth which has increasingly found its way into the hands of America’s richest.

If Americans want to do something about inequality – and the crisis has shown that we all have a stake in America rebalancing its economic pie – then they have to do more than raise taxes on the beneficiaries of corporate largesse. They have to go after the largesse itself, with policies which ensure a fairer distribution between business and workers in their common enterprise. That requires a political strategy which focuses not only on the individual workers, but on the larger economic ramifications of short-term corporate policies.

It requires progressives not only to stand in solidarity with the striking workers, but to point out to American independents, fiscal conservatives, and anyone willing to listen, that is not only a matter of Mott’s shortchanging handful of workers. These policies, and those like it, have implications for American social outcomes, global financial stability and the nation’s fiscal health.

So even if it has the ring of comedy, we have to start pointing out the greater truth of the matter, much as John Stewart did when he called out the hosts of CrossFire: it’s not that the demand in Williamson for concessions are bad. It’s more than that.

Dr. Pepper is hurting America.

Yes He Can

politics, US

Adapted almost completely from my piece in the Faculty of Law student paper, the Ultra Vires. I know, it’s a bit late considering the last two weeks of primaries, but I stand by my analysis. Plus some of the links are worth reading.

It’s down to Hillary and Obama and a plurality of students at the U of T’s law school, like most Canadians, has thrown its support behind Obama for President. We’re in good company: the popular video riffing on the recent Obama ‘Yes We Can’ speech features Scarlett Johanssen, the woman who plays McDreamy’s ex-wife from Grey’s Anatomy, some familiar looking white guy pretending to play guitar, and of course the video’s producer, will.i.am. The Grateful Dead have thrown their lot behind Obama, though we’ll have to take their word that Jerry sends his best to the campaign from his great tail-gate party in the sky. The support of Joan Baez means an end to self-imposed exile from party politics.

I’m backing Obama too, though, on the basis of his strong anti-corpocracy message, I was a supporter of Edwards until his exit from the race two weeks ago. But I’m doing more than supporting Obama’s candidacy. I’m going to make the call – he’ll get the nomination. I’m currently batting 1000 in such predictions: I could have been two bits richer if someone had put money up against my call for Dion in the recent Liberal leadership race. As I suggested, the combination of anti-Rae and anti-Ignatieff sentiment combined to put Dion, no matter his failings, in the hot seat. The result was more complicated: without Gerrard Kennedy’s endorsement in the closing minutes of the Convention, I might have lost that bet.In that way, Obama has something in common with Dion: the strength of a key Kennedy endorsement or more exactly, the support of a handful of them. Though the clan is divided – with the noted environmental activist Robert K. Jr. backing Hillary – the endorsement of Ted Kennedy, JFK’s daughter Caroline and Maria Shreiver will certainly give a boost to the Illinois senator, not least because of skewed media coverage of the matter. Despite the split in the Kennedy support, there is no doubt that the shine of Camelot has been lent to Obama, not Hillary.

The candidates aren’t that far apart on policy. Since the beginning, the choice between the two has seemed like a choice between hope and experience. Ezra Klein puts a finer point on it, colouring the choice as one between Clinton as manager and Obama as visionary. There are good reasons to support a manager for President. America has painted itself into a corner in Iraq, flushed its economy down the toilet while running its debt up to unfathomable numbers, and tarnished its international reputation through divisive unilateralism, de facto endorsement of torture and spying on its own citizens. Supporters of Hillary point to her experience as proof that she will be a steady hand at the tiller while America tries to sail out of these shallows. She is, for Democrats, the ‘safe’ candidate. Obama, on the other hand, is so full of enthusiasm that (no exaggeration) he brings tears to the eyes of many Canadians with hope about what the United States can be.

Writing two weeks ago, one day before the Democratic race was shown to have not one but two horses, Michael Chabon suggested that arguments against Obama were pragmatic, not substantial. Sure, his friends said, Obama might be charming, intelligent, and sincere, but he is too good to be true. Someone so nice can’t cut it in the snakepit of politics, they said, and Democrats need someone who can win. His speeches may have inspired famous Californians to march to the beat of a new drummer but in American politics, Hollywood support is often a burden, not a blessing. Up until last Tuesday, arguments against Obama were founded not on his character or on his potential as President but on his ultimate chances as Democratic nominee.

Here’s the catch. Americans are ready for a Democratic president. Polls say that they’re ready for change, independents are voting in record numbers in democratic primaries, polls have the democrats in the lead, and election markets have a democrat taking the prize by a 50% margin. More importantly, Hillary may be slightly ahead of Obama in polls among Democrats but American voters, buoyed by McCain support over Hillary among independents, are much more likely to elect Obama as President with McCain as the Republican nominee.

Until now, Democrats have supported Clinton because they thought that Americans prefer safety over promise, security over potential, sound mind over the possibility of something greater. Polls show the opposite, that Americans as a whole, not just Hollywood, much prefer the visionary to the manager. In short, with McCain as challenger, Democrats can choose the ‘safe’ candidate who is more likely to lose, or take a risk on someone their fellow Americans like and who, in their hearts, they already like more, too. Even the persistently self-defeating Democrats can’t screw this one up.

The Cat in the Hat and tests in the bag

culture, education, politics, US

Who are these people?

It is eminently logical that the reading comprehension tests scores of children and adults alike increase according to the time they spend reading for pleasure. More, it is not surprising that children with more than 100 books in their home score markedly better on standardized tests, including math tests,, than children whose parents own fewer than 10 books. And, especially for those who us have attended college, there is nothing breathtaking with this final conclusion, which along with the first two bits of trivia comes from a study by the United States National Endowment on the Arts discussed here in the New York Times:

students who lived in homes with more than 100 books but whose parents only completed high school scored higher on math tests than those students whose parents held college degrees … but who lived in homes with fewer than 10 books.

Thus my opening: who are these people? The correlation is remarkable only in the plainest, “notable”, sense of the word. What is breathtaking is not the conclusion, but the fact that there is a significant cohort of college-graduate parents who own less than 10 books.

I can think of only two even vaguely believable explanations for the existence of these people. Completing college is no guarantee of economic success. Perhaps, facing the slouching, lurching beast which is poverty in the United States, and specifically caught between its twin jaws of a pitiless labour market and an increasingly toothless welfare system, some college-graduates may be included in a sizable cohort priced out of books, as if they were only a disposable luxury.

More likely, in response to a rising tide of unnecessary credentialism, these parents participated in four years of post-secondary schooling so mind-numbing that, instead of feeding a flickering flame of passion for learning, the experience so finally smothered whatever academic spark they left high-school carrying that they respond to books in their home not with an inflamed literary temperament, but a more literally pyromaniacal urge.

Critics of the study suggest that the authors under-measure internet reading – though if my writing is any example of what is available, then we can be sure that writing on the internet is no substitute. Books are, the critics argue, a thing of the past. However, the conclusion about such correlations show that books still matter, and for children they matter at home.

There is a bright side, in the form of a clear lesson for all of us: if one wants to avoid a child so precocious that she corrects grammar and regales with trivia, the choices are to sell off one’s Hawking, Hemmingway, Chomsky and Chaucer, or to put them, along with the Cat in the Hat, under lock and key. At least until standardized test day. (via Arts & Letters daily)