Monday, July 20, 2020

Shaking up the core Republican beliefs -- economics



I have never had anything good to say about Donald Trump. Fundamentally I have been more concerned about the people who voted for him enthusiastically. There are many individuals as bad as Trump; the problem comes when large segments of the population can be convinced to vote for one of them. (Though Trump has been far worse in office than most of his opponents expected, including me.)

But Trump is a phenomenon of the past four to five years. Before Trump the basic tenets of the Republican party were already quite worrisome, given the values I hold and what's important to me. I'm far from alone.

Some Republicans (and the ones who through their pocketbooks wield the most power) are motivated simply by greed. They are the rich. They want lower taxes so they can have more money. That's a rational viewpoint. There's not much one can do to move them except perhaps appeal to some ember of charity and feeling for the common person that might be banked within them somewhere.

It is widely accepted (at least on the left) that most Republican voters are voting against their own economic self-interest. Some may not understand this, and perhaps their views could be changed by education. But when coastal elites hold them in contempt on this account, they are making a big mistake. The voters also may simply be acting in accord with their values. Many believe that life outcome is based on merit. The rich are rich because they've been smarter or wiser or harder-working, and they deserve what they have. If they are poor, they similarly deserve it. Although that is not at all my understanding of the factual situation, I should think they deserve some credit for voting in line with their principles rather than their narrow self-interest. Many of us would think that view had merit if the proposal on the table was a sort of pure communism, taxing everyone 100% and distributing the money equally among everybody.

I believe that it is vital that people feel there are incentives -- that what they do makes a difference for their personal welfare, typically in terms of how much money they have. Yet in moral terms, very little of a person's success is due to their own efforts -- a great deal comes from genetic and cultural endowment, such as what example your parents set and the material resources you had available to you growing up. Society used to value physical strength and endurance. Today it values intellectual skills far more. Your fate hinges in part on which skills you have and which era you were born into -- rather arbitrary and not a measure of some fundamental underlying worth. Today more and more money goes to the very best, who create the automated systems that dominate our lives. The productivity gains are enormous, but the effects on the standard of living of the bottom 80% are worrisome. The solution is largely redistribution -- taking money from those who are lucky and giving it to those who aren't so lucky.

The New York Times columnist Paul Krugman has said that poor Republican Whites oppose social programs because they don't want money going to Those People -- meaning undeserving lazy people with brown skin. It sounds plausible to me. The current experience with Covid-19 (and the hard economic times that are about to begin in earnest) will leave many of those Whites in deeper trouble than they were before. Perhaps some will understand that this isn't their fault, and start supporting such programs. Maybe some will in their minds recast some of Those People as folks like them who were doing their very best all along. Or maybe some will just accept the fact that Those People will get some of the money as an unpleasant side effect, but think of their own narrow self-interest as more important.

The election of Franklin Roosevelt in 1932 ushered in a sort of "New Deal Mentality" that wasn't seriously challenged until Ronald Reagan was elected in 1980 -- an extraordinary run of nearly 50 years. Ordinary folks were of value, and high taxes on the rich were just fine (top tax brackets reaching 90% at times). Perhaps an economic catastrophe of the kind that now seems to be unfolding -- on the order of the Great Depression -- could give rise to a renewed New Deal Mentality. However, I'm sure the modern-day Republicans will fight back fiercely with every tool in their arsenal.

What perplexes me more in retrospect is why the opposition to the New Deal Mentality was so weak for so long. Eisenhower in his 8 years as President didn't challenge it (though he wasn't himself really a dedicated Republican). Richard Nixon and Gerald Ford didn't challenge it -- Richard Nixon was on the verge of approving universal health insurance when Watergate hit. Another fascinating example came to my attention recently. When the US occupied Japan in 1945, we had the ability to reshape a society as had rarely happened before. In charge was Douglas MacArthur, a Republican, largely insulated from scrutiny of those back home in America. But the society he engineered was very much in line with the New Deal Mentality.

It would be an inspiring outcome of the rule of Trump and the pain of the Covid-19 pandemic if the US once again adopted a New Deal Mentality that would last for decades. The Republican opposition is so determined and clever that I would bet against it happening, but it remains a hope.


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