Deciding What Works

There’s no reason America pauses at the end of December – the world doesn’t – but Christmas makes everyone a bleeding-heart liberal for a few days. Everyone watches variations on the Scrooge story – life isn’t that bad if you stop being a greedy asshole and look around – in fact, life can be wonderful if we just cut each other some slack and help each other out. Macy’s Santa Claus turns out to be the real Santa Claus, the actual guy – and he’s a fine fellow, full of understanding and helpfulness and kindness – and everyone knows he’s really not into righteous retribution. Naughty and nice don’t really matter. No kid is going to get coal in his stocking, and even severe conservatives, who believe in personal responsibly, who say that choices have consequences and if you have little, and have no hope, it’s your own damned fault, contribute to those Toys-for-Tots things. Some even end up serving turkey and gravy at those Christmas dinners at city missions, to those they have been saying are the parasites that are ruining America, the Takers, not the Makers. They even smile at them. They forget Ayn Rand for a day – and when severely conservative politicians do this they make sure there’s at least some media coverage. A few carefully-framed photographs can be used as evidence to show they’re not mean folks. They can hide the consequences of their no-one-should-help-anyone ideology, for a day. No one will call them on this. It’s Christmas.

Then it’s over. Statisticians call this regression toward the mean – with large sample sizes, over time, exceptions are buried by the way things really are, normally. The mean, which in this case is mean, in the other sense of the word, is the norm. Santa takes a nap and then forgets the kids for the next eleven months. Scrooge probably does finally fire Bob Cratchit. Severe conservatives return to talking about the moral inadequacies of the poor, and the moral inadequacies of those who are not at least millionaires too – those people who work for others and whine about low wages and no benefits and miserable working conditions, when they could start their own business and take charge of their own lives. And they want government help? What’s wrong with them?

Yes, Christmas is over soon enough. Bill O’Reilly will get back to saying that anyone upset about the death of Eric Garner should stop wearing those stupid “I Can’t Breathe” t-shirts and start wearing “Don’t Abandon Your Children” or “Don’t Get Pregnant At 14” t-shirts – and Geraldo Rivera can get back to saying those t-shirts should read “We’re the Problem” – because certain kinds of people actually do deserve to die. That’s the word on Fox News. The police know who’s naughty and who’s nice. There’s no need to take any of them to court. Let the police decide such matters, as they should, and if Paul Ryan has his way, we will get rid of the social safety net and teach those losers all about Ayn Rand, providing them mentors to teach them about personal responsibility, so they’ll never ask anyone for anything ever again, and fine them if they don’t learn their lessons, or something like that. Ryan hasn’t worked out the details yet, but Scrooge will return. Have they no refuge? Are there no prisons? Are there no workhouses?

Scrooge probably won’t return until January, however, as the nation does shut down until the Monday after New Year’s Eve has been taken care of and all but the last college football bowl games have been played the next day. The nation pauses between two holidays, and the intervening week is when the newspapers and magazine and political websites drift away from the immediate and get contemplative, with columns that look back on the year, and sometimes the decade, and consider what really works. The immediate Christmas model is on everyone’s mind, which is a redistributive model – income inequality will ruin us all, as Scrooge finally realized – or it won’t, as people should get to keep what they’ve earned though their own work, and no one else has a moral right to take even one penny of that from them, and the government certainly doesn’t have that right. Life is hard. There are winners. There are losers, and sometimes those losers have to die. That’s just the way it is.

The old arguments will be rehashed. In 2008, somehow the rather dimwitted Joe the Plumber became sort o the official mascot of the Republican Party, for getting into a heated discussion, on his part, with Barack Obama, at a campaign stop in Toledo. The issue was redistribution – the government doing stuff for people with HIS money, in theory, since he didn’t have any. John McCain would go on to invoke Joe the Plumber in a presidential debate, repeatedly, with Obama saying that we’d all do well if everyone did well – a kind of a Christmas message. In 2010, the Tea Party made the Joe the Plumber argument, and sent a lot of folks to Congress, to end Obamacare, an experiment in redistribution, as they saw it, and in 2012, the Republican National Convention in Tampa was built on the theme “We Built That” – because at a July campaign stop in Roanoke, Obama, discussing education, infrastructure and other stuff that governments at various levels provide to make new businesses possible, made a mistake. Obama said this – “If you were successful, somebody along the line gave you some help. There was a great teacher somewhere in your life. Somebody helped to create this unbelievable American system that we have that allowed you to thrive. Somebody invested in roads and bridges. If you’ve got a business – you didn’t build that. Somebody else made that happen. The Internet didn’t get invented on its own. Government research created the Internet so that all the companies could make money off the Internet. The point is, is that when we succeed, we succeed because of our individual initiative but also because we do things together.”

The Republicans decided to call Obama on those four words “you didn’t build that” – ignoring the rest. Obama was insulting hard-working folks who has made it on their own, the kind of folks who never drove on a government road or walked on a government sidewalk or something. Romney’s forty-seven percent comment, about the useless and morally reprehensible folks who want the government to do something for them, even if the rich folks pay all the taxes, came later, but it was more of the same. The issue was redistribution. Is the country better off if everyone does reasonably well, even if getting to that point involves a little redistribution of the goodies, which seems unfair if not criminal to those with most of the goodies? If everyone does reasonably well the economy will thrive, and the rich will get even richer, but is that unfair to them? Is it morally wrong to get there THAT way? Shouldn’t people get what they damned well deserved? Why mess with the natural order of things?

Those questions were resolved at the national level. More than half of all voters, again, voted for a bit of a redistributive system, where everyone gets a chance to do well, through programs devised by their own government, because that’s better for everyone. Those who claimed they are morally superior seemed to have irritated a good number of voters – they just didn’t see it. Those guys looked like jerks, with Romney the biggest jerk. Let the government do a few more things – it’s our government after all, not the government of the morally superior rich.

Of course it is the government of the rich. After Citizens United they can spend all they want, pretty much secretly, to make it so, and they can even keep Obama in line on appointments to the treasury and other matters, but voters twice did take a bit of Scrooge out of the government, at the national level.

At the state level it was different thing. This was the year there was a counter-experiment in Kansas, where the governor was given the mandate to try another idea. Everyone would be better off if the government did less for everyone, by doing less stuff. Cut taxes to the bone, and especially taxes on business, big and small, and it might be that this would make things better for everyone, without government. Businesses would thrive, unemployment would disappear, and tax revenue would rise from all the new activity, so there’d be money to do a few things like paving the roads and fixing the bridges – but it would be the opposite of Obama’s redistributive model. Less would be more, or lead to more.

Less turned out to less, and now the folks who once adopted Joe the Plumber are getting anxious:

Ohio Gov. John Kasich will roll out “responsible” tax plans that protect against revenue gaps. Wisconsin Gov. Scott Walker and Arizona’s new Republican governor are delaying big dreams of nixing the income tax as they face budget shortfalls. And Missouri Republicans, once jealous of their neighbor Kansas’ massive cuts, are thankful they trimmed less.

Call it the Brownback effect.

Republicans once idolized Kansas Gov. Sam Brownback as a tax cutting superstar – now he’s a lesson in what not to do.

“It’s a cautionary tale on a national scale … Many of us felt that Kansas had been too aggressive,” said Indiana Senate Majority Leader and tax committee chairman Brandt Hershman, who helped GOP Gov. Mike Pence cut corporate taxes last spring. “We all like low taxes … but we have to ensure the stability of a revenue stream to provide basic services that our citizens expect.”

It’s a major turnaround from two years ago, when Brownback was considered a Republican trailblazer for conservatives around the nation who dreamed of phasing out their state income tax.

Now, Republicans are rethinking how aggressive they can be on taxes in light of the projected $279 million revenue gap that’s plaguing Kansas this year – shortfalls that resulted in the state’s credit rating being downgraded and nearly booted the Republican from office in a state that bleeds red.

Income taxes are redistributive, and they hate them, but they keep things going, but they won’t give up:

Of course, Republicans aren’t ditching supply-side economic theory or tax cuts. But they’re considering ways to avoid Kansas’ troubles. Their takeaways include smaller cuts over extended periods of time, stopgaps to protect revenues – and avoiding overpromising.

It’s making for an odd dynamic in which some Republicans now proudly say their tax plans will be “incremental” or “evolutionary” instead of “revolutionary.”

One must ease into what never worked, so maybe it might have a chance of working – but it should work, somehow:

Although income taxes composed almost half of Kansas’ general fund, Brownback said the cuts would grow the economy and attract new business, so that revenue would spring back quickly, essentially paying for the cuts. He had Reagan-era tax guru Arthur Laffer at his back supporting him.

But his plan didn’t pan out. Revenues are way down, and job growth remains below the national average. His own budget director says they may have to stop some of the tax cuts from going into effect, according to a New York Times interview.

Republican tax cutters in other states want to avoid that fate.

That’ll be a neat trick if they can pull it off, which leads the blogger BooMan to put things nicely:

Republicans still love their tax cuts and wish they could make tax cuts as large as Brownback’s, but they realize that there are some limits on how little revenue they can ask for, despite their remaining allegiance to the magical economic theories of Arthur Laffer.

In other words, it’s not really clear that they’ve internalized that the rhetoric (or, theory, if you want to be overly generous) is complete bullshit. It is possible to set a target for how much revenue you want and then set tax rates accordingly, but it is not possible to just slash taxes way below what you believe you’ll need and then hope for some kind of miracle to occur.

If your goal is deceptively and without the knowledgeable consent of the governed to shrink the size of the government down to a size where it can be drowned in the bathtub, then disregarding math and economics can work just fine. But if you actually want your budget to work, it is a prescription for looking like an idiot and ruining the fiscal condition of your state, the country, and the people who live there.

It sort of depends on what you want, but to be fair, or generous, Sam Brownback did want what he thought was best for the people of Kansas. He simply thought what was best for everyone was to unleash the potential of the winners, not the losers. This has been the Republican argument for decades. You decide what works, and you do it, and at the end of the year, in the week after Christmas, when people become contemplative, they take a look. Brownback ended up looking like an idiot. It happens.

He should have known better, but people don’t see the obvious, except perhaps at Christmas, when you might be visited by three ghosts, who slap some sense into you. But three ghosts might not be necessary. Christmas Day is when the NBA schedules its blockbuster rivalry games, four in a row, all day long, on national television, and Matthew Pulver points out how the NBA is built on redistribution, and is taking it one step further:

The league already has in place a redistributive model, with wealthy teams paying taxes to help bankroll small-market franchises. But recently, Michele Roberts, the new Players’ Association executive director, issued a bold opening salvo in her early tenure, speaking in terms that can only be described as Marxist and asserting the singular value of the players. “NBA Owners Expendable,” ran an ESPN headline in response to Roberts’ remarks. A leading voice on the sports network wondered if Roberts was leading the players toward the previously unthinkable: a player-owned league. Such a development would be the boldest experiment in socialism in decades, at least.

Sure, it’s only a game, but it also is a way of thinking that makes sense in a broader context:

After years of negotiating, the NBA’s economy now resembles a standard postwar Keynesian national model, with a familiar four-bracket marginal progressive tax structure used to redistribute revenue to smaller teams. It’s plainly clear in a sports league, if not in a nation, that systems seize and break down when inequality reaches untenable levels. For all our disagreement on such matters at the polls, Americans like the result of rigidly redistributive sports economies. In the NFL, the nation’s most popular league, nearly 61 percent of total revenue is collected and redistributed about the league, maintaining the relative parity that fans demand. All three big U.S. professional sports leagues have adopted redistributive practices. Even fans of the NBA’s coastal goliaths know – if deep, deep down – that Milwaukee has to have a chance to be champion. For all her conservative currency, Ayn Rand’s ideological absurdity would have been readily apparent were she to have written a sports novel where a dynastic New York team wins 34 trophies in a row. Americans do, in fact, like redistribution.

Forget the sports novel. Americans have known this forever – Damn Yankees ran for 1,019 performances in its original 1955 Broadway production and the film version was a big hit in 1958, and a new version is in the works. When the richest team with the biggest payroll wins year after year, and no one else has a chance, people get pissed off – at least in this tale. In real life they just stop going to ballgames, and the league dies. Everyone loses. All the players are out of work. That’s why there’s revenue sharing in baseball now, and in the other sports, but Pulver points out something more interesting:

If the NBA currently operates according to a sort of Keynesian, redistributive model, Roberts has provoked an imagination of a socialistic league, a revolutionary model that is, strictly speaking, non-capitalist. (It is socialistic in the broad sense of the term, not in the way it gets used to describe welfare-state models, which are, in the final analysis, mostly capitalist economies with socialistic salves to grease the gears, smooth out cyclical troughs and ward off unrest.)

The NBA might go whole-hog here:

“Why don’t we have the owners play half the games?” challenged Roberts when asked about the roughly 50-50 revenue split among players and owners. A Marxist truism now becomes a joke when considered in the case of the NBA; it’s the workers who create the value, not the owners. So while, say, the Koch brothers might appear necessary to the functioning of Koch Industries, NBA owners’ complete and total lack of hoops skill lays bare their superfluousness. No one wants to hear “And starting at power forward … Donaaaald Sterrrrrliiiing!”

Roberts drives the point home: “There would be no money if not for the players … There. Would. Be. No. Money.” Owners are expendable, she suggests: “Thirty more owners can come in, and nothing will change. These guys [the players] go? The game will change. So let’s stop pretending.”

Pulver notes others have stopped pretending:

Worker-owned businesses are fairly rare, especially wholly owned, large entities. But a trend toward the model has accompanied a changing attitude toward capitalism, writes University of Maryland professor Gar Alperovitz in the New York Times. “We may, in fact, be moving toward a hybrid system,” Alperovitz writes, “something different from both traditional capitalism and socialism.”

This third way, first attempted on a large scale by Sweden during the height of its radicalism in the 1970s, might well find a foothold in the wake of the Occupy movement. The Swedish experiment was never permitted to play out; corporate capitalism and nascent neoliberalism were set to dominate for the next few decades, and Sweden’s plan might not have been birthed at the right historical moment. But Occupy brought to public attention the non-hierarchical, participatory, democratic structures that had been incubated on the left during the last several decades of capitalist triumph and communism’s defeat.

Many on the left, unsatisfied with what they saw as a false choice between failed models of state socialism and corporate capitalism, explored this third way, neither capitalist nor socialist in their traditional senses. Stepping out into the vacuum of ideas in the wake of the 2007-08 economic crisis and Great Recession, Occupy was a sort of coming-out party for this leftist thought.

The discussion of the conflict between corporate capitalism and nascent neoliberalism may be a bit too much here – this is just basketball – but something is up, and leftist thought is Christmas thought, thoughts for that short period of time when everyone is a bleeding-heart liberal. “There would be no money if not for the players” – and Scrooge would not have been rich but for Bob Cratchit keeping his books.

We should do something about that sort of thing. All three big professional sports leagues already do the socialist redistribution thing, taking from the rich and giving to the poor, for the good of everyone, with everyone’s consent. Even the rich owners know this is for their own good, and they’re quite happy with it – but maybe they aren’t even necessary. The end of the year is the time to look back and see what worked and what didn’t this year, or a time to do no more than watch a few basketball games – but that may be one in the same thing now. We already know what works.


About Alan

The editor is a former systems manager for a large California-based HMO, and a former senior systems manager for Northrop, Hughes-Raytheon, Computer Sciences Corporation, Perot Systems and other such organizations. One position was managing the financial and payroll systems for a large hospital chain. And somewhere in there was a two-year stint in Canada running the systems shop at a General Motors locomotive factory - in London, Ontario. That explains Canadian matters scattered through these pages. Otherwise, think large-scale HR, payroll, financial and manufacturing systems. A résumé is available if you wish. The editor has a graduate degree in Eighteenth-Century British Literature from Duke University where he was a National Woodrow Wilson Fellow, and taught English and music in upstate New York in the seventies, and then in the early eighties moved to California and left teaching. The editor currently resides in Hollywood California, a block north of the Sunset Strip.
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One Response to Deciding What Works

  1. Rick says:

    That NBA thing is brilliance! Why hasn’t some sports fan brought this up before now, as a real-world example of anti-inequality theory in action? I pretty much couldn’t do it, since I know dip about sports.

    But this idea of employee-ownership of their own company has a history of mixed success. For example, in the mid-1990s, United Airlines’ pilots, machinists, baggage-handlers and others (United flight attendants, who refused to join in, wore buttons that said, “we just work here”) agreed to accept 55% of the company’s stock in exchange for salary cuts — which worked out fine until they later successfully negotiated with themselves for large wage increases, and later saw their stock wiped out in a bankruptcy. Weren’t those flight attendants the prescient ones.

    So maybe we can best see the difference between right-wing and left-wing economic theories illustrated in the discussion over government budget deficits:

    * Those on the right, following the arguments of (the unfortunately-named) Arthur Laffer, say that the best way to shrink the gap between low tax income and high government spending outgo, in good times or bad, is to reduce taxes, based on the idea that, with lower taxes to pay, people will have that much more money to spend, and so the increased spending will goose the economy into higher gear, which will lead — voila! — to more tax income! In other words, “Less is More”.

    * Those on the left, following the arguments of Maynard Keynes, say the best way to reduce that gap, at least in bad economic times, is to increase government spending, based on the idea that this will directly pump more money, through the government, into the economy, thereby goosing the economy into higher gear, leading — voila! — to more tax income! In other words, “More is More”.

    The right would argue, “Poppycock!”, or words to that effect — that public spending just drives out private spending, and that an economy that depends on government spending is not a healthy economy — while the left would counter that lower taxes do not really ever pay for themselves, not in a healthier economy, but certainly not ever by making up for lost tax revenues.

    So which theory of “what works” is right? No surprise that, me being of the left and therefore finding all sorts of examples of Keynesianism working and of Lafferism being downright silly, I think the left is right; otherwise, I probably wouldn’t be of the left.

    Or is that really true? Probably not. I suspect that, even if either side could prove to the other that their theory is absolutely true, the other side would still reject it. After all, it really isn’t all just about real-world logical truth, it’s also about what we want to be true.

    That is, even if I could prove beyond any doubt that looking out for the least of us will help all of us, a conservative is likely to say that this misses the point, which is that, even if helping the poor is good for the overall economy, there’s that larger issue of “moral hazard” — that is, lazy people should never be rewarded, period!

    And, of course, it’s also true the other way around — that is, even if it turns out that “tough love” conservatism is better for the economy, we on the left would reject it, since it means the economy would be succeeding on the backs of those who are less fortunate than the bastards who were lucky enough to inherit their fortune, whether literal or figurative, from others.

    Is this to say, all these arguments between liberals and conservatives about what indeed works are about as significant as a bunch of ducks quacking at each other? The answer, according to Thomas Jefferson, in this article in “Mother Jones” from earlier this year, is pretty much — Yes!:

    Thomas Jefferson was a smart dude. And in one of his letters to John Adams, dated June 27, 1813, Jefferson made an observation about the nature of politics that science is only now, two centuries later, beginning to confirm. “The same political parties which now agitate the United States, have existed through all time,” wrote Jefferson. “The terms of Whig and Tory belong to natural, as well as to civil history,” he later added. “They denote the temper and constitution of mind of different individuals.”

    In other words, conservatives are different from you and me (and no, it’s not just that they have more money), as documented by University of Nebraska-Lincoln political scientist John Hibbing’s 2008 paper, published in the journal “Science”:

    It found that political partisans on the left and the right differ significantly in their bodily responses to threatening stimuli. For example, startle reflexes after hearing a loud noise were stronger in conservatives. And after being shown a variety of threatening images (“a very large spider on the face of a frightened person, a dazed individual with a bloody face, and an open wound with maggots in it,” according to the study), conservatives also exhibited greater skin conductance—a moistening of the sweat glands that indicates arousal of the sympathetic nervous system, which manages the body’s fight-or-flight response.

    It all adds up, according to Hibbing, to what he calls a “negativity bias” on the right. Conservatives, Hibbing’s research suggests, go through the world more attentive to negative, threatening, and disgusting stimuli—and then they adopt tough, defensive, and aversive ideologies to match that perceived reality.

    Four years later, he and his colleagues came up with an eye-tracking device capable of measuring how much time a subject spends looking at an image, and found that liberals tended to dwell on “appetitive” (that is, happy or positive) pictures, while conservatives spend more time on “aversive” (threatening, scary, disgusting or negative) ones. In one combo photo offered as an example in the article, there were three “aversive” photos (a bleeding sore, flies on a corncob, and dog poop) and one “appetitive” (cute little girls, dressed as ballerinas). I needn’t tell you which side dwelled on which, but this also allows science to give the lie to all those conservatives who accuse liberals of being so “negative”; probably the only real negative thing about liberals is that they reject conservatism.

    So what do Hibbing and his people think political ideology is actually comprised of?:

    They think that humans have core preferences for how societies ought to be structured: Some of us are more hierarchical, as opposed to egalitarian; some of us prefer harsher punishments for rule breakers, whereas some of us would be more inclined to forgive; some of us find outsiders or out-groups intriguing and enticing, whereas others find them threatening. Hibbing and his team have even found that preferences on such matters appear to have a genetic basis.

    Which is something I’ve suspected for a long time — that our political leanings are determined by the kind of people we are, which is determined largely by the temperaments we’re born with. But, it should be noted, it need not be inferred from this that, having a genetic basis, our politics will be those of our parents. I, for example, was raised by conservative Republicans, whom I loved very much in spite of it.

    Still, which side is right about deciding what works? That’s easy: My side!

    Not that that matters, of course, since the other side is the one with all the money.


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