Climate Policy of the Bourgeoisie July 19th, 2009

It appears that the president’s global celebrity status doesn’t advance the effectiveness of environmental scolding.  The Indian government rejected Secretary of State Hillary Clinton’s calls for legally binding carbon caps, lest such limits “undermine the economic growth that is necessary to lift millions more out of poverty.”

I’m sure some people in low-wage, high-energy jobs (e.g. manufacturing, mining, etc.) in the U.S. share the sentiments of the Indian government.

Civil Rights Not on the Ballot June 18th, 2009
Harry Jackson, flustered. Opposing civil rights is such hard work.

Harry Jackson, flustered. Opposing civil rights is such hard work.

The bad part about direct democracy is that it empowers the tyranny of the majority to overrun the rights of unpopular minorities.

We have reported before that when the D.C. city council voted to recognize same-sex marriages performed elsewhere, the lone dissenting vote was cast by Marion Barry, who claimed to stand “on the moral compass of God” and opposed the legislation also out of what he claimed to be racial solidarity. Joining him in standing in the schoolhouse door was Bishop Harry Jackson, a District resident (more on that below) who is the pastor of a Maryland church.

Unhappy that the city council passed the civil rights legislation, Jackson threatened to bring the matter to a city-wide referendum, where, as we have noted before, it just might pass.  Jackson hit a snag earlier this week, though, when the city’s Board of Elections invalidated the proposed ballot question since it would deny civil rights to LGBT people, whom the city’s Human Rights Act protects from discrimination. City law wisely prohibits ballot referenda that contradict the Human Rights Act; human rights are not, and should never be, up for a popular vote.

Mr. Jackson is challenging the board’s decision in court, hoping an “activist judge” will side with him and let him put the discriminatory civil rights question on the ballot. Complicating the matter is whether Mr. Jackson has standing as a District resident to propose the referendum. As the Washington Blade has reported, Jackson and his wife own two houses (blessed are the poor?) in Montgomery County, Maryland, and neighbors claim they reside in one of those houses, a $1.1-million mansion. The Jacksons, however, claim neither home as their principal residence according to tax records. For the purpose of voting, Mr. Jackson claims residence in unit 630 in the tony Whitman condominium building in the Mount Vernon Triangle area of DC. Tax records show that a Mr. Joseph Honaker owns this one-bedroom condo and claims it as his primary residence. If these records all hold true, it would appear that Mr. Jackson shares a one-bedroom condo with another man.

Joining Mr. Jackson in his battle against civil rights is Rev. Walter E. Fauntroy, former D.C. Delegate to the House of Representatives, former city councilman, and civil rights activist (until now); Rev. Dale E. Wafer, pastor of the Harvest Church in Northeast; Melvin Dupree; Sandra B. Harris, a real estate agent with Cosmopolitan Properties in Shaw; Dr. Patricia Johnson, dean of a local Christian liberal arts college; and Bobby Perkins, Sr., pastor of World Missions for Christ Church in Shaw.  Even if Mr. Jackson is not a bona fide resident, that still doesn’t necessarily stop the ballot referendum since one of these other residents could carry the torch of discrimination.

Nobody knows how the court will rule (our guess is that they will defer to the Board of Elections,  City Council and city attorney), but it is truly shocking to see such strident opposition to civil rights in a supposedly liberal city, where over 90% of the electorate cast ballots for Barack Obama.  Eternal vigilance is the price of liberty.

Obama’s Compromise on DC Vouchers May 7th, 2009

We lamented President Obama’s decision to swiftly end the D.C. voucher program, noting that his administration, which doles out billions of dollars for careless bankers and failed automakers, couldn’t find a trifling $15 million for poor children in the District of Columbia.  The Post reports today that the president has yielded to his better judgment and is proposing a fairer method of ending a program, which ideally would not end.

The program provided school vouchers for low-income children in the District to attend private schools for two-year stints.  Those in the program showed modest academic improvement and parents were much happier with their chosen schools.  It’s no secret that teachers’ unions are hostile to school choice, since it risks diverting public funds from the failed schools they control to the private and parochial schools in which they have little clout.  The unions pressured Congress, which is now majority Democrat, and Congress obliged by refusing to renew the voucher program.

Education Secretary Arne Duncan swiftly rescinded the vouchers for the upcoming year, pronouncing the program dead.

The president is now proposing a compromise: the children currently enrolled in the program will receive vouchers through their high school graduations, but no new students will be admitted to the program.  This is an improvement over the previous plan, which would have kicked kids of modest means to the curb come September.

The president is right to strike a compromise— compromises are necessary in a democracy— but the president’s choice to compromise on this subject is worrying.  On one side are children from low-income families that have few choices for quality education.  On the other side are powerful, deep-pocketed teachers’ unions that oppose reform or real accountability measures that might inconvenience or shrink their membership.

Ideally, Mr. Obama would expand the program to afford more low-income District children the ability to escape the city’s schools, which are among the worst in the nation.  Mr. and Mrs. Obama, upon moving to the White House, passed over the city’s public schools in favor of the private Sidwell Friends School.  Why are the Obamas’ neighbors any less deserving?

Normally it is good for a president to compromise, and this compromise is likely the best he could achieve with this Congress.  Nonetheless, this compromise suggests a moral equivalence between low-income children looking for a good education and powerful teachers’ unions looking to protect their privilege.


Update:
On a positive note, the president is proposing $517 million for merit-pay programs.  Let us hope this is not window-dressing.

The Suit in the Schoolhouse Door April 23rd, 2009

Kanye West

“George Bush doesn’t care about black people.”

So said Kanye West in the aftermath of Hurricane Katrina when hundreds of poor, mostly black, residents of New Orleans were stranded in the Superdome and atop flood houses in the Big Easy.

No matter, with the election of Barack Obama, surely the Federal government now attends to the best interests of disadvantaged minority populations, right?  Not always.

In 2004 Congress passed the District of Columbia School Choice Incentive Act, providing vouchers of up to $7,500 for low-income children in the District to attend private schools. Since the District’s public schools are among the worst in the nation and considering that poor parents love their children, too, it’s no surprise that parents jumped on the opportunity with such enthusiasm that the program developed a waiting list. A recent U.S. Department of Education study found that children in the program scored about the same in math and slightly more in reading.  Nonetheless, voucher parents were much more satisfied with their chosen schools than public school parents were with their schools.*

The voucher program operated with the strong support of the mayor, the District’s “state” superintendent, and the low-income parents of the voucher recipients (90% black, 9% Latino), who finally got the chance to give their children what their neighbors Mr. & Mrs. Obama give to their children: a quality private education.  The parents were happy and the kids’ performance improved modestly.  In an era when the Treasury hands out hundreds of billions of dollars to shoddy banks and failed carmakers, certainly the voucher program’s modest success was worth the paltry $15 million annual cost.

Not so fast!  Enter the teachers’ unions and their partner-in-disparity, Eleanor Holmes Norton, D.C.’s non-voting Delegate to the House of Representatives.  She made clear her opposition to the program, telling the Post, “…the Democratic Congress is not about to extend this program.”

With Democratic majorities in both houses and at the behest of the teachers’ unions, Congress, fresh from passing $410 billion budget bill, callously failed to renew the voucher program.

If we ran our elections the way we run many of our public schools, there would be civil rights investigations and lawsuits to match.  Instead, when public-sector mediocrity denies poor children their right to a decent education, thereby reducing their future life opportunities, the Right doesn’t much bother with an issue it never noticed anyway and the Left willfully averts its eyes toward its well-heeled funders.  If voting patterns still hold true, the beneficiaries of these programs would vote overwhelmingly Democrat anyway; the G.O.P. has nothing to gain, the Democrats have nothing to lose.  Sadly, the children have much to lose.

In noting the disparities in the quality of public education in America, Rev. Al Sharpton, in a rare moment of clarity, stated why public education continues to fail millions of Americans:

The people standing in the schoolhouse doorway now are people we thought were our friends, liberals wearing suits not bibb overalls, principals and teachers who want to uphold the status quo — condescending bigots who perpetuate a system we know is profoundly unequal.

Conservatives typically don’t make public education their issue, except when it comes to biology (evolution), health (sex), and school prayer.  Liberals typically advocate the use of government power to equalize social opportunity and even equalize social outcomes.  Even though one would normally expect the Left to advocate policies that best benefit marginalized populations, the Democratic party still knows that both money and ballots talk: the nation’s two big teachers’ unions, the National Education Association and the American Federation of Teachers, support Democratic candidates with massive investments, volunteers, and votes.  When the interests of the unions conflict with the interests of disadvantaged children of color, the former constituency holds the trump card.

Tellingly, Ms. Norton also told the Post several months ago, “We have to protect the children, who are the truly innocent victims here.”  Indeed they are.


* In fairness, one might attribute this to the fact that people have a tendency to view the consequences of their own choices more positively than consequences imposed on them by others.  Just as people exhibit a pride of ownership in homes, people exhibit a pride of ownership in their own choices.  If “choice” can apply to abortions, it should certainly apply to schooling.

The Bankruptcy of the Creative Class April 14th, 2009
Gentrifiers in Portland exchange greetings.  Perhaps they're discussing the virtue of their Priuses.

Gentrifiers in Portland exchange greetings. Perhaps they're discussing the virtue of their Priuses.

Sandra Tsing Loh wrote a excellent piece in the Atlantic snarkily speculating what this recession will do to America’s culture leaders, the Xers, she calls them (a.k.a. David Brooks’s bourgeois bohemians and Richard Florida’s creative class).  Reared in America’s upper- and upper-middle class Valhallas, these college-educated, socially conscious idealists, having never tasted the bitter foot of Maslow’s hierarchy, have heretofore devoted their lives to the maximization of self-expression.  When one is accustomed to an easy life of economic privilege, one becomes too easily inclined to view the concern for things like economic development (the creation of actual wealth) as crass—dare I say unsophisticated!— hobbies.

Having splurged on overpriced liberal-arts degrees, pricey socially conscious clothes, and fashionably “fair-trade” this-that-and-the-other, the once trendy interest in all things eclectic and environmentally sustainable is no longer financially sustainable.   The lofty eclectic idealism has, over the past few decades, morphed this left-leaning bohemianism from an identity once defined by a distaste of consumption into an identity defined by its taste in consumption.

Wither the free-range chicken bistro?  Now that carelessly accrued credit card debt is out of fashion, how can one survive without a steady diet of the moral superiority digested from politically-charged cuisine choices?  Will the forced economic sobriety of our current economic affairs force America’s left-leaning culturally-righteous to reexamine their once-proud disregard of economics—that crass topic!?

Bid farewell to the increasingly progressive, self-righteous, self-congratulatory, overwhelmingly white, and socially stratified Portland.  Hello, diverse, affordable, yet bland, Cleveland.  Farewell to the ritzy Rive Gauche Xanadus, hello to the staid skid-rows bereft of artisan boutiques and scarily “authentic”.

Loh writes,

This economic catastrophe is teaching the Xers that their prized self-­expression and their embrace of personal choice leads to … the collapse of capitalism. Time to inculcate not those self-satisfyingly hip and rebellious values—innovation! self-fulfillment!—cherished by the creative class (a class, after all, that includes in its ranks those buccaneering entrepreneurs who’ve led us down the primrose path), but those staid and stolid values of the bourgeoisie: industry, sobriety, moderation, self-discipline, and avoidance of debt.

Hear, hear!  Perhaps now economic development will actually get a fair hearing when policymakers are forced to consider feel-good measures as taxes on plastic bags and carbon emissions, favored by the elite self-expressionistas, but opposed by the lower- and lower-middle classes, and by nearly every family on a budget.  Fewer can afford the luxury to sacrifice economic well-being for the sake of a political statement.

Billionaires for Obama April 6th, 2009
Larry Summers on ABC's This Week

Larry Summers on ABC's This Week

As we have noted before, hedge funds, private equity firms, and their employees donated nearly twice as much to the Obama campaign as they did to the McCain campaign.  After the election, the new administration appointed some of its backers and friends on Wall Street to oversee TARP bailout money.  Few have given much scrutiny to this obvious conflict of interest until now.

On Friday the White House released the financial records of some of the administration’s top advisers.  As it turns out, President Obama’s chief economics adviser, Larry Summers, “earned” $5.2 million advising a New York hedge fund one day a week for the past two years.  Though the President desperately yelped to express his “outrage” at excessive AIG bonuses, he has remained conspicuously mum on the Mr. Summers’s lavish executive pay for such little work in an industry he now oversees.

Some have wondered why the administration has been so harsh on Detroit, threatening bankruptcy and executive firings, while only gently nudging Wall Street banks.  The fact that the administration has drawn so many warm suits and generous contributions from Wall Street suggests Mr. Obama holds his friends in finance to a milder standard.

When the Bush Administration let oil companies draft energy policy and let pharmaceutical lobbyists draft the Medicare drug benefit, Democrats cried foul, and rightly so.

Now Mr. Obama surrounds himself with smart bankers and economists who frequently spin around the revolving door between government and the finance sector, having made a fortune on risky bets and now seeing that the taxpayers are left to clean up the mess.

Will $250,000 Make You “Rich”? March 4th, 2009

Many small businesses such as shops and doctors’ offices are sole-proprietorships, meaning the income of the store is counted on the owner’s tax return as his own personal income. As a result, many small business owners are grossing more than $250,000 annually in income, even though they must pay rent, insurance, and employees’ salaries from this income, leaving only a modest sum to remain for the owner.

These business owners, because their personal income is combined with their business income, may face higher taxes under Pres. Obama’s tax proposals. What makes this coming tax debate interesting is that tax increases will heavily fall on people who voted for the President in the first place. Is this an instance of betrayal or an instance of you get what you vote for?

Victor Davis Hanson at RealClearPolitics, addressing the new President, discusses the implications of classifying small-business owners as “the rich”. He very smartly identifies the Democratic constituencies that will face higher tax bills under the President:

In fact, for your [spending programs] to succeed, you must go after the upper, upper middle-class, those making between $250,000 and $600,000 who are restaurant owners, home builders, labor contactors, architects, surgeons, engineers, hospital executives, college administrators, Ivy-League law professors, and many dentists.

These households are wealthy, yes; but they don’t own or even fly on $50 million private jets or host private Super Bowl parties. Their income is all reported, and with such good salaries come high insurance and, in the case of business, constant reinvestment and expensive inventories. They are not greedy, but the bulwark of the United States’ productive classes who in aggregate pay over 40% of the collective income taxes, and provide most of the jobs in the country. Under your plan many in these high-tax states will pay nearly 70% of their incomes in FICA, Medicare, federal income, and state income taxes. Why gratuitously mislead the American people that those for whom you will lift FICA ceilings or up their IRS bites to 40% are in any way synonymous with the super-rich? Remember the very, very wealthy voted overwhelmingly in your favor precisely because their riches gave them immunity from high taxes, and in many cases they were far removed from the everyday risk and worry of owning a hardware store or trying to keep together a family-owned construction firm. George Clooney is a world away from a paving contractor, just as making $400,000 a year on call 24/7 is not quite making $40 million investing or $2 million for a cameo.

So please no more intellectual dishonesty, Mr. President. Those in great numbers who will pay your higher taxes are not really the rarer Warren Buffets, Bill Gateses, Diane Feinsteins, Teresa Heinz Kerrys, Sean Penns, George Soroses, Oprah Winfreys, or Tiger Woodses, whose mega-wealth really does result in private jet rides, and yet exempts them from worries that increased taxes might wreck their small businesses. (my emphasis)

Some business owners facing higher taxes may find it more economical to incorporate their businesses and file taxes separately for their respective businesses. If this is the case, the President’s plan to boost revenue to pay for all his programs may not collect as much as he anticipates.

(No worries, though, since we can always foist these financial burdens on the unborn. Since when do they vote?)

The President’s opponents highlight that his aim is to redistribute wealth downward à la Robin Hood, but the President himself prefers to highlight his aim to provide such necessities as universal health insurance coverage. However, if the President’s aim were merely to provide necessities, it’s only fair that he come clean with the true costs of these programs.

The Bush Administration, wanting to hide its deepening budget deficits, cynically and dishonestly refused to count Iraq spending as part of the normal budget, instead requesting the money as “emergency” appropriations. Though Pres. Obama is rightly including Iraq spending as part of the normal budget, he is underestimating the costs of his forthcoming health care plans, somehow imagining that taxing “the rich” (celebrities, hedgefund managers, as well as roofing company owners) can somehow finance the all-ages version of the most out-of-control government medical insurance program in the nation.

There is no such thing as free healthcare and the bill must be paid somehow, be it through escalating private premiums or through escalating tax rates.  The President is wisely persuing cost reductions through large-group bargaining of drug prices, digitization of medical records, and research into best practices to reduce mistakes.  These are worthy goals, no doubt, but like earmark reform, they will merely dent expenditures slightly, leaving hefty bills to be paid through the public treasury.

The super-rich can afford marginal increases in their tax bills, but sole-proprietors grossing more than $250,000 may find this President rather taxing.

Gentrification Halt February 26th, 2009

Urban Reinvestment

When real estate prices deflate and consumer spending dives, does gentrification wither? In real estate, sale prices and rents are “stickier” when falling than when rising. Thus, rents and prices should not fall as fast as a drop in consumer spending warrants. Consequently, shops suffer this gap between revenue declines and rent declines, causing them to go out of business much faster than they otherwise would.

The New York Times discusses an example of this unfortunate process playing out right now in the once-gentrifying Eagle Rock neighborhood of Los Angeles.  The paper notes that

The deep recession, with its lost jobs and falling home values nationwide, poses another kind of threat: to the character of neighborhoods settled by the young creative class, from the Lower East Side in Manhattan to Beacon Hill in Seattle. The tide of gentrification that transformed economically depressed enclaves is receding, leaving some communities high and dry.

However, these gentrified neighborhoods did not just change economically.  They changed socially, too, attracting a base of residents with the  job skills, education, and worldly curiosity to support a variety of local retail shops.  Even when these shops that opened under brighter economic times shutter their doors due to a souring neighborhood economy, the intrinsic demand sparked by the changing neighborhood culture does not disappear.

When happy days are here again, these neighborhoods will likely sprout coffee houses, soap shops, thai restaurants and the like rather than pawn shops, tatoo parlors, and car repair shops of the long-gone decades of disinvestment.

Dating Dispatches from the Bourgeoisie February 25th, 2009

Ms. Hilton

Are you running up hefty credit card bills on expensive dates to impress women?  Dude, careless extravagance is so 2007.  This economy is impairing the dating scene for America’s go-getters, as more Ivy League  i-bankers exchange coke lines for bread lines:

“It’s been incredibly stressful for me,” said Neil Welsh, 27, the guy in the suit, who until last year was marketing director for a booming real estate company. “I was so used to using my financial situation to leverage my dating.”

The horrors!  While some families worry about buying groceries, ambitious, single twentysomethings fret that potential mates might have to judge them on personality and character instead of W-2 forms.

Though this economy is inflicting real pain on millions of people, one small benefit is that it’s forcing our society to re-evaluate our priorities and materialistic attitudes.

Would Prop. 8 Pass in DC? Probably. February 22nd, 2009
Source: LA Times

Image source: LA Times

Much has been made of the surprise passage of California’s Proposition 8, which amended the Declaration of Rights of the state’s Constitution to state that “[o]nly marriage between a man and a woman is valid or recognized in California.”  What hasn’t received much attention, however, is that the city council of Washington, DC, may move in the coming months to extend marriage rights to same-sex couples.  In the past, the main obstacle cited is Congress; even if the city council approved a same-sex marriage bill (probably with near-unanimity), Congress, which has legislative authority to overturn any DC law, would overturn it in a heartbeat.

But since the Democrats now control Congress and the White House, the city now faces the best opportunity to introduce a marriage bill that would face the lowest chance of Federal opposition.  However, even if the measure escaped a snarling Congress, the measure would likely face stiff opposition from a large bloc of city residents.  If the civil rights measure is put to popular vote in Washington, DC, voters may in fact reject it.

Since there are no public opinion polls of District residents gauging opposition to same-sex marriage in the city, it is hard to predict how a ballot question would fare.  However, if we extrapolate November’s exit-poll results on Proposition 8 from California, the civil rights landscape in DC looks a little bleak.

In the best scenario, a DC vote would reflect the results among California’s urban voters.  Forty-five percent of California’s urban voters opposed Proposition 8.  Since all DC voters qualify as urban voters, if the proportions voting for and against held the same, a ban would lose.

(All the following data are drawn from CNN’s exit-poll of California and extrapolated based on each cohort’s share of the DC electorate as provided by MSNBC’s exit-poll of DC)

Marriage Ban Extrapolated by Urban Vote

If we extrapolate from other measures, the outlook isn’t as good.  Based on income group, the results show a ban would just squeak by.  Interestingly, among all income groups, only those making less than $30,000 and those making more than $150,000 opposed Proposition 8 by a majority.  The vast middle supported it.  Now if we multiple each group’s support and opposition in California by each income group’s respective proportion of the DC electorate, a same-sex marriage ban would pass in DC by a slight majority.

Marriage Ban Extrapolated by Income

It gets worse.

In California, 53% of college graduates opposed Proposition 8, whereas only 42% of those without college degrees opposed it.  Though 58% of District voters are college graduates, that is still not enough to stop a ballot measure in the city.  Based on education, a ballot measure in DC would ban same-sex marriage with a 52% majority.

Marriage Ban Extrapolated by Urban Vote

Finally, race is the pink elephant in the room few want to bring up.  Traditionally, black voters, gays, and those with socially liberal views overwhelmingly vote  for Democrats.  However, on the issue of homosexuality, one Democratic constituency, blacks, holds views strong opposed to those held by other Democratic constituencies (social liberals, gays, etc.).

An astounding 70% of California’s black voters cast ballots in favor of Proposition 8 and an even more astounding 75% of black women voted in favor.  Proposition 8 only found greater support among self-identified 2004 Bush voters (80%), white evangelicals (81%), Republicans (82%), McCain voters (84%), weekly churchgoers (84%), conservatives (85%), and those who approve of the war in Iraq (85%), among others.

When we extrapolate each ethnic group’s vote in California to adjust it for each group’s proportion of the DC electorate, a same-sex marriage ban easily passes by 61% of the popular vote in the District.

Marriage Ban Extrapolated by Race/Ethnicity

Admittedly, California and DC, though both Democratic strongholds, differ in some important ways.  DC is entirely urban, whereas California is home to urbanites, a huge portion of suburbanites, and sizable rural counties.  Furthermore, unlike DC, California is more ideologically diverse and contains some very conservative areas (San Diego and Orange Counties, most notably) as well as liberal enclaves such as San Francisco, Hollywood, and Berkeley.  Washington’s singlemindedness leans decidely leftward, but in California the tilt, though still to the left, has counteracting forces that DC largely lacks.

Nonetheless, it’s premature for the city council and gay civil rights campaigners to assume that everyone shares the same view of what constitutes a civil right.  Though same-sex marriage might not raise eyebrows in upper Northwest, not all DC residents are ready to embrace a progressive view of marriage.  When the council starts to debate such a measure, don’t be surprised when you hear opponents ironically claiming civil rights for me, but not for thee.

Ivory Tower Plutocracy December 3rd, 2008

Conservatives love to accuse academia of a rampant liberal bias. While it is true that professors are overwhelmingly registered as Democrats and that college students and professors are the only people left in the free world who take Marxism seriously, academia’s actions tells a different story.

Yet another study, this one by the National Center for Public Policy and Higher Education, has found that college tuition costs are outpacing income growth. America’s universities are increasingly closing themselves off from America’s poorest.

For all the high-minded rhetoric of “social justice” the tuition bills seem to tell a different story.

A New Ruling Elite November 4th, 2008

David Brooks captures two elements of Obamania.  First is its close association with privilege:

Obama is not only a member of this temperate [post-boomer] generation, but of its most educated segment. He has lived nearly his entire adult life within a few miles of one or another of the country’s top 10 universities.

His upscale, post-boomer cohort has rallied behind him with unalloyed fervor. Major college newspapers have endorsed him at a rate of 63 to 1. The upscale educated class — from the universities, the media, the law and the financial centers — has financed his $600 million campaign (which relied on big-dollar donations even more heavily than George W. Bush’s 2004 effort). This cohort will soon become the ruling class.

Second is its unpreparedness in handling the nation’s challenges.  The ruling elite will come to face problems America has not seen for decades.  Deflating asset prices, higher unemployment, and lower tax revenues will challenge any new administration, no matter who wins tonight.  Can the young Obama supports, roused to the polls by promises of hope and change, fully comprehend the pending hard-nosed politicking?

Raised in prosperity, favored by genetics, these young meritocrats will have to govern in a period when the demands on the nation’s wealth outstrip the supply. They will grapple with the growing burdens of an aging society, rising health care costs and high energy prices. They will have to make up for the trillion-plus dollars the government will spend to avoid a deep recession. They will have to struggle to keep their promises to cut taxes, create an energy revolution, pass an expensive health care plan and all the rest.

….

We’re probably entering a period, in other words, in which smart young liberals meet a stone-cold scarcity that they do not seem to recognize or have a plan for.

Indeed, the boomers continue to haunt American politics, even if one of their representatives is not in the Oval Office.  Hope and change are good talking points, but health care plans cost money and most economists agree that raising taxes right now would further damage the economy.  We can’t hold hands to make tough decisions; some constituencies will inevitably lose and if Sen. Obama wins the election, it won’t take long before some of his young naifs are disillusioned with the messiness and required compromise of democratic politics.

A President Obama may claim to represent change, but as Brooks astutely concludes, “In an age of transition, the children are left to grapple with the burdens of their elders.”

Greenspan on Kyoto September 21st, 2008

I’m nearing the end of Alan Greenspan’s The Age of Turbulence and came across his criticism of the Kyoto Protocol, an agreement environmentalists tend to adore, but which will inevitably have undesirable economic consequences for much of the world’s poor.  (My emphasis is added below)

There is no effective way to meaningfully reduce emissions without negatively impacting a large part of the economy. Net, [a capt-and-trade system] is a tax.  If the cap is low enough to make a meaningful inroad into CO2 emissions, permits will become expensive and large numbers of companies will experience cost increases that make them less competitive.  Jobs will be lost and real incomes of workers constrained.  Can a national parliament vote to impose costs on constituents when the benefits of its actions are spread across the globe, wholly independent of where the CO2 savings come from?

More generally, can a democratic government stand against an accusation that whatever savings in CO2 emissions are pressed on its constituents, they are likely to be more than wiped out by increased emissions coming from developing countries that were not included in the agreement reached in Kyoto in 1997?  And can developing countries be asked to forgo creating the carbon emissions associated with economic development?  Should access to “free” pollution permits be shut off only after a large number of countries have become developed?  I doubt very much that a Kyoto-type accord will bring world agreement on some penalty for the emissions of greenhouse gasses.  Spewing CO2 into the atmosphere is as much a violation of property rights as my dumping refuse into my neighbor’s yard.  But protecting such rights and assessing the costs of an infringement are exceptionally difficult because monitoring the cost is not feasible.  Our recent difficult history with international agreements requiring broad acceptance, whether in the World Trade Organization, the United Nations, or any other world forum, makes me pessimistic.  Cap-and-trade systems or carbon taxes are likely to be popular only until real people lose real jobs as their consequence.

We can summarize Greenspan thusly:

  1. The Cost: Reducing emissions by fiat (either by cap-and-trade or by a carbon tax) will cost polluters money.
  2. The Benefit: The benefits are a public good, indivisible and non-exclusionary.  Thus, non-participants will benefit no matter what.
  3. The Politics: The public is unlikely to bear the costs of a system whose benefits are diffused and even visited upon non-participants.

Both John McCain and Barack Obama support some sort of carbon tax.  Though it is politically popular to show that one is “doing something” about a popular political issue, it will be interesting to see how the candidates respond to the details.  What happens when a carbon tax renders entire American industries unprofitable?  What happens when energy-intensive manufacturing jobs, often staffed by the lower- and lower-middle class, must lay off workers simply to pay for carbon permits?

If lower- and lower-middle class workers must face hardship while high-paid tax accountants and lawyers face minimal costs increases, are we really implementing a just tax system?  These are difficult questions to answer and though I know public opinion favors “doing something” to combat global warming, I suspect much of that support will wilt when it becomes clear that people of modest and meager means will face real hardship.

The Stuff [Well-Educated, Liberal] White People Like September 20th, 2008

The Atlantic reviews the book version of the famed blog Stuff White People Like (SWPL), a list of attitudes and tastes favored by America’s young, well-educated Left.  The review provides a good look into what I think is so compelling about the SWPL: it accurately capture the frivolous and egocentric superficiality that has infected America’s young “progressives”.  SWPL has found the young Left and called it out on its major flaw, namely its conformity masquerading as anti-conformity.

Despite its title, SWPL is not about white people; it’s about the tastes and preferences of the archetype of the young, urbane, well-educated American espousing politically leftish beliefs.  The main disappointment about this archetype is that he holds these beliefs not as a matter of universal, well-considered truth derived from a particular social or political philosophy, but as a superficial fashion statement.  It’s cool to be a privileged white liberal, after all.

This archetype forms many of his preferences because of their exclusivity or their lack of mass appeal—true elitism.  The Atlantic article notes

More damning is the conclusion produced by a careful reading of this often fine-grained semi-sociological analysis: a good deal of the progressives’ attitudes, preferences, and sense of identity are ingrained in an unlovely disdain for those outside their charmed circle. In Lander’s analysis, much of their self-satisfaction derives from consumption (the slack-sounding “stuff” in the title is deceptively apt)—and much of that consumption is motivated by a desire to differentiate themselves from the benighted. Sushi, for instance, is “everything [White People] want: foreign culture, expensive, healthy, and hated by the ‘uneducated.’” And whatever its goals, the ACLU is beloved by White People, Lander satirically but not wholly unjustifiably asserts, because it protects them “from having to look at things they don’t like. At the top of this list is anything that has to do with Christianity”—an aversion, Lander discerns, rooted not in religious enmity but in taste (Christianity is “a little trashy”), formed largely by class and education. To those of this mind-set, the problem with a great many Americans is that they don’t “care about the right things.”

How disingenuous it is indeed for one to claim adherence to the ideals of the Left (e.g. democracy, openness) while despising the tastes and values of the American majority.

Constituencies Matter September 4th, 2008

Richard Layman raises a good point on how government services are conceived and perceived:

Is public transit supposed to be a service of last resort for people who don’t own cars? Or is public transit supposed to be a system to enhance mobility by reducing the need and demand for automobiles, supporting urban economic development, reducing traffic and congestion, and getting very large numbers of people to places effectively and efficiently.

For a lot of places, government provision of services are focused on providing service to people without other choices. Maybe that inalterably impacts how service is provided?

Indeed, when particular government services are only offered to the weak and desperate, the public constituency for such services is only the weak and desperate. As a result, the services fall into neglect, disrepair, and mismanagement since the city’s influential elite and middle-class don’t have to face the problems of these mismanaged programs.

I’ve often wondered whether Washington’s Metrobuses would run better if the city’s councilmen had to ride them to work everyday. Clearly yes. However, the problem extends to other services as well. Another example is the city’s public school system, among America’s worst by most measures. Since the city’s elite and increasingly elusive middle-class are either childless or send their children to private school, they have only a passing, academic interest in the state of the city’s public schools. As a result, one will find that the system has pretty much become the school “option” of those who can afford no other option: families who can neither afford private school nor afford to leave the city for the suburbs.  Even Mayor Fenty doesn’t send his children to the city’s schools.

Likewise, I’ve frequently heard this concern of constituency voiced in opposition to means-testing Social Security.  If the rich and upper-middle class are excluded from receiving Social Security benefits (but not exempted from paying the taxes), they will loose interest in Social Security as a government program and the program will consequently suffer.  It is an argument that I believe is outweighed by other considerations (e.g. the system’s solvency and the unfairness of taxing lower-income earners to pay benefits to the rich), but the point is worth considering nonetheless.

Constituencies matter and when we design government programs, we must consider who will benefit and support them.  Congressmen, for better or for worse, have long realized this, passing ill-conceived and otherwise unpopular measures by attaching them to widely popular bills. If we want government programs to receive the necessary attention and support, we must include the interest of the powerful and politically active to ensure their health and survival.