Month: July 2010

Rand Paul is a doctor. Surely he understands the difference between the symptoms of a disease and the cause. Surely he knows that the only way to cure a disease is to treat the cause and not simply address the symptoms.

In a speech before the Kentucky Farm Bureau on July 22, 2010, Dr. Paul said that the budget deficit is the most important issue facing the nation. Specifically he said that the deficit was his “number one concern.”

Hopefully the fact that the deficit is Dr. Paul’s number one concern means he will address the cause of the problem and not just the symptom. But if you look at his stated positions, (see his web site: www.randpaul2010.com) he is focused almost entirely on reducing the deficit, and doesn’t even seem to grasp that it is part of a larger problem.

Make no mistake, the deficit is a symptom of a larger disease. The current national budget deficit is a product of the changing economy, it is not the cause of the changing economy. The deficit is the symptom, the disease is the changing world and national economy. The world economy has been changing dramatically for the last 20 to 30 years, and the pace of change just keeps getting faster. Computers have dramatically altered the marketplace in many ways, including my eliminating entire career fields. Secretaries, draftsmen, and bookkeepers are largely a thing of the past. When I first started practicing law about 15 years ago, most law firms, even sole practitioners, had at least one secretary for each lawyer. Today most solos don’t have a secretary, and the ratio of lawyer to legal secretary at big firms is one secretary for every three lawyers. Computers and word processing software have made legal secretaries obsolete. Automation has similarly changed manufacturing. Robots and computers have replaced workers in factories. Because of automation, most companies produce more manufactured goods with fewer employees, and make more money doing it. This is good for a company’s bottom line (and good for their investors) but it is bad for employees and bad for national employment. Foreign competition is also cutting into domestic manufacturing, and in many cases preventing domestic companies from raising prices or wages. All of this has led to a general economic slowdown. The overall economy was slower in the first decade of this century than at any time since the end of the Second World War. And the last ten years have seen almost no job growth.

The national economy has slowed and this means that government revenue has slowed. But unfortunately the size and scope of government has not slowed. If you chart the growth of the economy since the sixties and the growth of government during the same period you will notice that the two roughly parallel each other. But the line for the economy essentially flat-lined during the Bush Administration, but unfortunately the line for the government continued up on about the same slope as in previous years. And the difference between these two curves is partly responsible for the budget deficit. During the flush economic times we – government and business – made commitments that made sense at the time (health care benefits, retirement benefits) but that are no longer economically feasible.

Solving the budget deficit is definitely important, but it won’t bring back jobs lost to computerization and automation. Lawyers are not going to start rehiring legal secretaries and factories are not going replace robots with laborers if the federal budget is balanced. The Chinese economy is not going to stop growing if the Congress passes a balanced budget amendment. Certainly fiscal restraint will mean that more money can go into the private sector than the public sector, but that alone will not solve the larger systemic changes to the economy.

If Rand Paul’s prescription for the ailing economy is nothing more than ending the deficit, he is treating the symptom and ignoring the disease.  

The Rockefeller Institute recently published a study showing that the economic anxiety index is at an all time high.

The full report can be found at:

http://nw-assets.s3.amazonaws.com/pdf/ESI_report_embargoed_until_7-22_low-res.pdf

According to the report, the American people are significantly more anxious about their economic situation today than at any time since the study began in the early 1980’s. But according to the trends shown in the report, it is not just a spike caused by the current economic recession. The trend line has been up since the mid 1980’s (when the survey first began.)

There are many reasons for this increased anxiety but a major factor is the increase in job instability. Fewer people are working at large corporations and no longer have the expectation of career-long employment, which was common up through the 1970’s. Large companies are increasingly being replaced by small business and sole entrepreneurs. Being your own boss is great, you are free to succeed and fail based on your own efforts. But there is no safety net for poor performance. The same holds true if you are an employee at a small business. One bad month can mean the difference between employment and unemployment.

The demise of large, hidebound companies and the rise of more flexible small businesses means a more flexible economy, but this creates a need for more flexible employees. The cost of this flexibility is less security. Good for business, bad for employees sense of stability. And guess what? Employees are citizens. So economic flexibility can lead to a sense of employment insecurity, and a general sense of unease among the public.

This corresponds to the bigger problem: economic uncertainty leads to political instability. Politics have become more unsettled in the last twenty or thirty years as the economy has become more unstable. The public is increasingly worried about the economy, and not just about the problems caused by the current recession. They want stability, they want security, and most of all they want politicians that can bring this about. And increasingly the public is willing to try anything, to grasp for any solution, simple or silly.

Obama was elected, in large part because of the public’s dismay at the way the Bush Administration and the majority Congressional Republicans seemed to screw up the economy. And now that things are not getting better, the public is ready to throw out Obama and the Democrats. That is certainly understandable. The so called experts and supposed smart people who ran the economy (and the government) for the last ten or fifteen years sure haven’t done a great job, so why not try someone unproven? Why not Sarah Palin or some other new and untested leader? Given recent events, and the lousy job done by the old hands, how could inexperience be any worse?

But what if neither the Democrats nor the Republicans have a solution to the current problems? What if the national and world economy has changed so fundamentally that the old solutions are obsolete?

The Bush era tax cuts and de facto deregulation (which follow standard conservative theory) only made matters worse. And the Keynesian policies of the Obama administration haven’t improved things.

I suspect that this political instability will not go away until this high level of economic instability also goes away, or at least is significantly reduced. And neither party seems to know how to do that, so I think for the time being we are in for some interesting politics.   

I will assume that you know the story of Shirley Sherrod the USDA worker who was recently fired for allegedly making racists comments only to be rehired when it was revealed that her comments were part of a longer speech about overcoming racial prejudices. If not you can read the latest version of the story here:   http://www.nytimes.com/2010/07/22/us/politics/22sherrod.html?_r=1&hpw

I am not going to comment on the story itself, but rather discuss that the story tells us about how some conservatives (and in particular Andrew Breitbart) view the human nature and the American public. The Sherrod saga began when Breitbart posted on his web site a short snipped of a speech that Ms. Sherrod gave to a state NAACP gathering in Georgia. (Ms. Sherrod was an official with the US Department of Agriculture based in Georgia.) He then notified all of the usual right wing media outlets about the snippet, and implied that it proved that Ms. Sherrod was a racist, and by implication the NAACP condoned racism. Within a day the snippet was all over the news, starting of course with FoxNews, and within another day Ms. Sherrod was fired by the USDA. Then, within another day, the full tape came out, and it showed that Ms. Sherrod was really talking about overcoming racism.

This incident should bring into crisp focus what some conservatives think about human nature and the American people.

First they think we are idiots. They think that they can release heavily edited tapes and sway public opinion because we are all a bunch of shallow nitwits. And apparently they are right. Breitbart did it earlier this year with the selectively edited ACORN tapes which purportedly showed staffers from the community activist group ACORN advising a purported pimp about how to establish a prostitution ring. Subsequent state investigations showed that these tapes had been heavily edited to show things that had not actually happened. The problem with the ACORN situation is that the facts did not come out until months after the incident. Fortunately this time the facts came to light close enough to the incident. But the fact that Breitbart is perfectly willing to manipulate information proves that he thinks that the American public can be manipulated with phony information. This indicates that he thinks we are idiots.

Second they think that people are one dimensional. In the snippet first posted, Ms. Sherrod does say that she was reluctant to help a white farmer. But the entire speech was about how she learned to overcome her own prejudices. The speech shows the breadth and depth and complexity of human nature. It shows how people deal with situations based on preconceived notions, but also about how people can learn and change. But many conservatives do not see that. They think that people are simple and one dimensional. They think that a single racist statement proves that a person is a racist. It is a strange and constrained view of human nature, and one that is disproved by history and disproved by people daily. One good example of the lack of correlation between nasty words and actual beliefs comes from President Lyndon Johnson. He had a foul mouth, and frequently made racists comments. But he forced a number of civil rights laws through Congress, which changed this nation and put it on a path to be a fairer more tolerant country.

In any event, people are clearly not one dimensional. They can and do overcome past prejudices. They learn and grow and improve.

But Mr. Breitbart and his fellow travelers apparently don’t believe that because they think we (me and you, but perhaps me most of all) are idiots.   

 

President Obama signed the sweeping financial reform bill on Wednesday, July 21. One of the criticisms by Republicans and other opponents of the bill is its complexity. The bill itself is over 2000 pages long. This was a major complaint about the Health Care reform bill that Obama signed earlier this year.

It is certainly troubling that bills are so long that our elected representatives are not able to read them completely, and certainly not able to understand them fully. In many cases these complex laws are written by staffers in consultation with lobbyists. TIME Magazine recently had an article about how Lobbyists were helping draft the Financial Reform Bill. It was enlightening if not a bit scary. It is available here: http://www.time.com/time/politics/article/0,8599,2000880,00.html   

Many critics say that things were better back when Congress passed simple laws. Critics noted that the law establishing social security was only a few pages long. But is it really better to pass short and simple laws? The problem is that short and simple is not the same as clear. Short and simple often means broad and vague, and this leaves the law open to a variety of interpretations.

When Congress passes a broad law the matter moves to legislative agencies to create the rules necessary to administer the law. And this means that a second set of laws (make no mistake, Federal Rules are laws) are drafted by unelected government bureaucrats. Is that what we want? That is inherently undemocratic. (It should be noted that there is a detailed administrative rule making process that is supposedly designed to ensure public input on these rules, but the reality is that only interested parties (read lobbyists) get involved at this level.) So a broad law leads to undemocratic rule making by vested interests. Is this better than a detailed and complex law? Maybe it is, and maybe it isn’t.

The second problem with broad laws is that they leave lots of room for judicial interpretation: you know, legislating from the bench. Courts are generally bound by the laws that are enacted by Congress (the exception is when the law violates the Constitution). But where the law does not address a specific issue the Courts (by the long established judicial tradition known as the common law) fill the gaps. The more gaps, the more the courts write the law. And when Courts write the law they are engaged in an undemocratic process that is known as judicial activism or legislating from the bench. So broad laws lead to judicial activism. Is that better or worse than a detailed and complex law?

It is interesting that the people who complain the loudest about the complexity of these laws are also the same people who complain the most about legislating from the bench. It think it points to their naiveté about politics, law, government and the modern world.     

Not long ago I wrote about the problem likely to occur with of increased partisanship in judicial elections. Critics will say that the current “a-political” system also has its problems, and they are right. The fact that judicial candidates cannot talk about issues makes them either a blank slate, or disingenuous, neither of which is a good thing for a judge. There are two other options for putting judges on the bench, and both have their problems. In the Federal system judges are appointed for life by the President. This keeps them above petty politics during their tenure, but it can create problems if a judge is incompetent (a Federal Judge can be impeached for “high crimes or misdemeanors” but not incompetence). Perhaps the best system is the “Missouri Plan,” where the governor appoints judges from a slate established by a panel of citizens and lawyers, and where these judges must periodically stand for retention elections. This is a pretty good system, but even it has problems. In some cases a judge can make an unpopular (though legally sound) ruling which raises the ire of activist groups who seek to remove the judge, not for good cause, but merely for ruling in a way that angers that particular group. Retention elections, in those states that apply the Missouri Plan, are generally very low key, but every once in a while they are incredibly nasty and petty and a disservice to both the judiciary and the political process. .

 The problem is that we live in an imperfect world, so there can never really be a perfect system. Not for selecting judged for courts, nor for much else. People are imperfect beings, and unfortunately when you put them in a group you don’t overcome the imperfections, rather you tend to multiply them. And the world is an immensely complex place. Adding imperfection to complexity is not a formula for creating simplicity or perfection.

But we like simplicity. It is much easier to understand simple ideas and slogans than the complexity of the real world. But simple slogans, and simple solutions, are unlikely to solve complex problems. Sometimes they will, but more often than not they won’t.

Politicians and political commentators love to say “the solution is simple.” But unfortunately nothing is really simple. They might seem simple, but on further analysis they aren’t. Driving a car might seem relatively simple and straightforward, but the reality is that driving a car is dependent upon an incredibly complex system of roads, traffic laws, and fuel distribution networks, not to mention everything that goes into putting the car onto the road in the first place, which implicates everything from the mining of steel and aluminum (for vehicle parts) and coal (for steel production and generating power to run factories) to growing the rubber for the tires and educating the engineers who design the car in the first place.  

If you scratch below the surface of just about anything you will find complexity. And this can be quite madding. So it is understandable that people turn to the idea of simplicity, but it is a false hope.  

I think this misplaced desire for perfection and flawed belief in simplicity underlie many of our current political problems.