Thursday, May 31, 2018

Trade Wars - Boarding the Ship of Fools

“For example, the supporters of tariffs treat it as self-evident that the creation of jobs is a desirable end, in and of itself, regardless of what the persons employed do. That is clearly wrong. If all we want are jobs, we can create any number--for example, have people dig holes and then fill them up again, or perform other useless tasks. Work is sometimes its own reward. Mostly, however, it is the price we pay to get the things we want. Our real objective is not just jobs but productive jobs--jobs that will mean more goods and services to consume.” 
Milton Friedman, Free to Choose
Back in 1929, at the onset of the Great Depression, Laurel and Hardy filmed "Big Business" ,a slapstick comedy that portrayed an escalation of hostilities, from small gestures to mutually assured destruction. (You may want to skip until 11 on the video to watch the climax that reflects what a tariff war looks like to a rational spectator and how it ends)

That was indeed what happened a few years later, when the US Congress passed the Smooth-Hawley Act and started the first global trade war.




Once upon a time Republicans listened to one of their eminent economists, Nobel Laureate Milton Friedman explain why trade wars and tariffs are self-punishment and bad economics:




That one brought Hitler, Mussolini, Franco, Lenin and the Japanese fascists to power and with them, the logical next step that was World War II.

Sixty million deaths and seventy-five years later, a populist president toys with starting a tariff war with all US's major commercial partners at once: China, EU, Canada and Mexico.

The promise for the fools is the same than in 1932: jobs will come back, salaries will go up and the "unfair" competitors will surrender.

Economist Bryan Caplan explains why voters self-immolate for a second time in his educational book "The Myth of the Rational Voter"



Fool me twice...

John McCain: The Last of the Lincoln Republicans


"We don’t build walls to freedom and opportunity. We tear them down. To fear the world we have organized and led for three- quarters of a century, to abandon the ideals we have advanced around the globe, to refuse the obligations of international leadership for the sake of some half- baked, spurious nationalism cooked up by people who would rather find scapegoats than solve problems is unpatriotic."    
Senator John McCain (R), 2017

John McCain was an American hero in many ways. 

He was a military POW how resisted 5 years of torture in the Hanoi Hilton, yet returned to Vietnam to make peace with his own captors and help reestablish diplomatic relations.

He followed Barry Goldwater as the senator for Arizona and championed just, unpopular and politically inconvenient causes such as campaign reform, immigration reform and lately, offended both Left and Right by supporting his rival George W. Bush's surge in Iraq and voting down President's Trump populist and popular repeal without replace of the ACA healthcare bill known as Obamacare -which he also opposed vehemently-.

His argument for opposing the latter was a call to a civility lost in the populist wave that brought Trump to the White House:




A populist wave that McCain lamented to have helped by selecting populist firebrand Sarah Palin over his democratic first choice, democratic senator Joe Lieberman.

He ran a uninspiring campaign against Barack Obama in 2008 and damaged his reputation with an uncharacteristic surrender to populist pandering. It was perhaps an example of his fighter jet pilot tendency to quick judgement that, like others on the USS Forrestal and over Hanoi, backfired badly. He somehow took distance by standing against deranged birthers that hated his rival more than any Republican principle.




McCain never hesitated in working and voting across the partisan divide, engaging in lively debates and lifelong friendships and collaboration with rival Democratic leaders such as Ted Kennedy, Joe Biden and Russ Feingold. He is and will certainly be admired and missed by the best  of both parties. And certainly reviled and insulted by the worst. 

Thanks to John McCain's dedication to fight partisanship, he will remain a healthily divisive figure between those who put country over party and those who don't. The former will remember him fondly, the others will hate him stronger as time goes by. He would probably relish keeping such friends and foes.



McCain's contempt for Trump was just the latest rejection of his populist views and unpresidential behavior by most of the moderate Republican leaders, a long list that included a similarly embarrassing absence at Barbara Bush's funeral -where his wife Melania sat and chat with president's Bush, Clinton and Obama- and public denunciations by all of the living former presidents (including Bush 41 and Carter), 2012  and presidential candidate Mitt Romney.

In any case, what caused Cindy McCain's request was not just Trump's disrespect and incivility towards him, but toward the very American values and principles McCain fought for as a soldier and as a senator.

The best farewell to John McCain is following his advice and his example of civility and honor.

Republicans will have a lot to do and a lot to change to meet John McCain's standards.

Sunday, May 20, 2018

Can US Republic survive populism? - Joseph Ellis and the pessimistic wisdom of John Adams


A new populist wave is sweeping the Western world. It's fueled by the same combustible than others before: global economic crises and their discontents.

Historian Joseph Ellis has dedicated part of his notable career to explaining why our Founding Fathers didn't want a democracy in the mold of the French Revolution. Moreover, they saw the 20,000 killed on the name of the "people" under the Terror period as a stern warning for us, the stillborn Brittish colonies trying to become the United States.

Adams warned presciently against putting much hope on democracy per se:
“Democracy… while it lasts is more bloody than either aristocracy or monarchy. Remember, democracy never lasts long. It soon wastes, exhausts, and murders itself. There is never a democracy that did not commit suicide.”
Adams saw executive power and human condition as a menace for freedom and the nascent Republic:
There is danger from all men. The only maxim of a free government ought to be to trust no man living with power to endanger the public liberty.
– John Adams, Notes for an oration at Braintree, Spring 1772.
He believed on giving full power to the people, but thought people as individual citizens with individual rights, no majorities or mobs getting beyond the law nor governments and presidents reigning beyond it:
“The way to secure liberty is to place it in the people’s hands, that is, to give them the power at all times to defend it in the legislature and in the courts of justice.”– John Adams
Adams stood against the majority almost all his political life and particularly eloquently when he defended British soldiers charged with the Boston massacre in 1770:
“The law no passion can disturb. ‘Tis void of desire and fear, lust and anger. ‘Tis mens sine affectu, written reason, retaining some measure of the divine perfection. It does not enjoin that which pleases a weak, frail man, but, without any regard to persons, commands that which is good and punishes evil in all, whether rich or poor, high or low.” 
– John Adams, Argument in Defense of the British Soldiers in the Boston Massacre Trials, Dec. 4, 1770. 
Against the prevalent fashion of idolizing Jefferson's Declaration of Independence, Ellis leans towards the more clear judgement of his rival John Adams, our second president.

Adams never thought much of democracy, the "people" or the American people for that matter. He saw the country as a motley crew instead of an Ethnic nation as Europeans' republics were.



There was a revolutionary summer when all the rather practical ideas of the framers came together, in a lasting collision as our 1787 Constitution is. 




Unlike Madison -who thought the division of powers and states rigths would prevent the tyranny of any eventual majority-, Adams dreaded that the US Constitution and its institutions would not be enough to control people's lowest passions if excited by demagogues.
"Avarice, ambition, revenge and licentiousness would break the strongest cords of our Constitution, as a whale goes through a net. Our Constitution was made only for a moral and religious people. It is wholly inadequate to the government of any other."
These days are putting Madison's controls and Adams' fears against each other. 

A recent article on the very Republican National Review argues from its title that "Our government was designed to protect us from the Trumps of the world"

Demagogues and populists always test the limits of existing institutional restraints looking for ways to circumvent them. From Mussolini to Hugo Chavez, that has been a constant trait. 

Democracies, however, elect populists and demagogues now and then and set the stage for erosion of the rule of law and the republican checks and balances. 

Hopefully, Adams will be proven wrong once more. But that will not happen without a return to civility.

Lets leave the last word on this subject to Adams himself:
“Remember, democracy never lasts long. It soon wastes, exhausts, and murders itself. There never was a democracy yet that did not commit suicide. It is in vain to say that democracy is less vain, less proud, less selfish, less ambitious, or less avaricious than aristocracy or monarchy. It is not true, in fact, and nowhere appears in history. Those passions are the same in all men, under all forms of simple government, and when unchecked, produce the same effects of fraud, violence, and cruelty. When clear prospects are opened before vanity, pride, avarice, or ambition, for their easy gratification, it is hard for the most considerate philosophers and the most conscientious moralists to resist the temptation.”
    (Quoted from page 406 of The Political Writings of John Adams, Regnery Publishing, 2000.)