Donald is sure taking a lot of hits

The pundit class consensus today seems to be that "the tide is turning" against the Donald. So opines JVL at the Bulwark and he's no cockeyed optimist. I'll be skeptical til I get around to assessing for myself what a determined observer can see. 

Meanwhile, here's JVL's list of why we just might save some broken version of American democracy. He enumerates a case that efforts to throw sand in the gears of a rising fascism might be having an impact.

• 7 million people came out to protest the regime.

• The administration’s shutdown of the government turned into a political liability for Trump.

• Trump demanded that Senate Republicans get rid of the filibuster; they refused.

• The MAGA right split on the acceptability of Nick Fuentes and his groypers.

• Democrats won more electoral victories and by far larger margins than polling indicated they would.

• A series of Epstein documents suggested a much closer relationship between Trump and the pedophile than was previously assumed.2

• Four House Republicans defied direct pressure from Trump to a enact a discharge petition and override the speaker’s attempt to avoid an Epstein file vote.

• With the petition signed, enough Republicans were going to defect that Trump had to surrender and “authorize” them to vote for the release of the Epstein files.

• The DHS occupation of Chicago failed. The city did not bend to Trump’s will. The state prevented him from deploying an invading force of Texas National Guard troops.

• Indiana Republicans have resisted Trump’s desire for them to redraw their congressional districts.

• His net approval rating is -14.

Unfortunately, we'll have to see -- and must keep pushing to make it happen

Meanwhile, not considered in JVL's catalogue of Trumpian horrors, is a crypto collapse that takes down large parts of the US financial sector. Could happen. I put my money of Paul Krugman's assessment of crypto. 

 

If only this madness didn't also take down the rest of us. We're running a hella test of Adam Smith's proposition that "there's a great deal of ruin in a nation."

Trump comes after Black women when he attacks economic stability

Paul Krugman, who is a Nobel prize winner unlike one Orange-tinted pretender, knows the score. It's hard to manage an enormous economy well. Krugman explains this requires a smart balancing act. That's why we have (had?) an independent  Federal Reserve Board, to make economic decisions as impartially as any democratic political system allows.

When the inflation rate is low but the unemployment rate is high, as it was during the Great Recession in the aftermath of the 2008 financial crisis, the Fed should cut the federal funds rate. By lowering the fed funds rate, the Fed makes it cheaper for banks to lend. This boosts the spending and investing activity in the economy and brings unemployment down.

When inflation is high but unemployment is low – that is, when the economy is at risk of overheating -- as it was in 2022, the Fed should raise the fed funds rate. This slows down spending and investing and brings inflation down.

But when the unemployment rate and the inflation rate are both too high — what economists call “stagflation” — the Fed faces a dilemma. Cut the fed funds rate rates to support employment and you risk worsening inflation. Raise the fed funds rate to fight inflation and you risk raising unemployment. With stagflation, there are no easy answers, just a tradeoff of risks.

And this dilemma looks very relevant right now: many economic indicators suggest that the United States will soon undergo at least mild stagflation. ...

Not a moment when you want more buffoons in charge. But here we are with the Orange Madman in the White House.

Most likely, if Trump gets his way with the Fed, the country will drift into an economic doom loop which will be bad for ordinary folks as prices rise and jobs disappear -- and  Donald Trump isn't interested in any of this. He's got a bunch of crackpot ideas which defy the experience of over 100 years of advanced capitalist economies. And he wants unlimited power over the Fed to force it to implement his notions.

Lisa Cook

It should be no surprise that Trump has fixated on a Black woman as the impediment to his economic fantasies. Lisa Cook is an experienced, accomplished economist. And she's the first Black woman ever appointed to the Federal Reserve Board. So Trump's corrupt Department of Justice is accusing her of unproven mortgage malfeasance. Cook properly refuses to resign just because Trump has trumped up a complaint. She's forcing Trump to go to court to try to fire her. Guess sometime down the line we'll get yet another chance to see just how far Trump's supine Supremes will go to please Daddy.

Meanwhile, the Trump economy and especially federal workforce cuts are already disproportionately kicking Black women to the curb.

Erica Green describes the carnage:

... The most recent labor statistics show that nationwide, Black women lost 319,000 jobs in the public and private sectors between February and July of this year, the only major female demographic to experience significant job losses during this five-month period,...

Experts attribute those job losses, in large part, to Mr. Trump’s cuts to federal agencies where Black women are highly concentrated. 

White women saw a job increase of 142,000, and Hispanic women of 176,000, over the same time period. White men saw the largest increase among groups, 365,000, over the same time period. 

Ms. Roy said that with the exception of the pandemic, Black women have never seen such staggering losses in employment. And over the last decade, the experiences of that population have consistently signaled what is to come for others. 

“Black women are the canaries in the coal mine, the exclusion happens to them first,” Ms. Roy said. “And if any other cohort thinks it’s not coming for them, they’re wrong. This is a warning, and it’s a stark one.” 

... a report published by the National Women’s Law Center, which compiled and analyzed the now-deleted O.P.M. [the federal Office of Personnel Management] data, showed that government agencies that were targeted for the deepest cuts had employed the highest percentages of women and people of color. ...

He's coming for all of us who can't pay him off -- but he's coming first for Black women. That's how it works in this country.

Dumb and dumber

I remember kind of enjoying the 1994 movie. Those dumb boys were sort of funny, in a stupid way.

Donald Trump's dopey tariffs aren't so funny. Even though he revealed himself to be trying to tariff penguins. Any number of economists -- left, right, and center -- agree he's thrown us into a trade war in which ordinary Americans only lose. Their estimates vary between $3000 and $5000 per household in increased costs as a consequence of Trump's trade idiocy.

So why this madness? There seem to be two elements that Trump thinks serve his interests:

1) The tariffs give Trump the legal ability to exempt particular sectors and countries. How many millions or even billions will he be demanding from companies to enjoy these exemptions? We've never seen such straightforward opportunities for presidential corruption. And the moral rot of such a system spreads. Will every individual who holds a tiny smidgen of power over others expect to be personally paid off in the Trumpy future US economy? That's how it works in much of the world.

2) Domestic importers will pay the tariffs if they continue to engage in trade in our deeply interlinked world. They'll try, and mostly succeed, in defending their bottom line by passing their increased costs on the US consumers. Trump will claim he's found a magic source of cash that will replace any need to try to tax our oligarchs. After all, there's all this cash coming in from the tariffs. Let's cut taxes some more for millionaires and billionaires! 

It's all sick and sad.

Let's fight back, starting with the Hands Off rallies tomorrow. Find an event near you here.

The vibes are getting better

 

When I've been told by news media that US majorities believe Donald Trump will be better for "the economy" than Biden and now Kamala Harris, I'm gobsmacked. 

 

And when I'm now shown, by the Financial Times via economic historian Adam Tooze that we now, slightly, think Harris would be better at the economic job, I'm also gobsmacked.

 

By the sorts of measures used by economists, the American economy has been chugging along happily for at least 12 months with something close to jobs for everyone who wants one, rising wages, low inflation, even a happy stock market (though how much this last has to do with the economy I don't know.) 

But for all that time, many survey respondents have been insisting that Trump would be better for "the economy." I can only conclude that mostly what people mean by "the economy" is confidence that they'll able to eat and have shelter, all with some degree of comfort and expectation for a future. 

Maybe sign boards advertising gas prices and perhaps boarded up storefronts figure somewhere in that, as well as Joe Biden's weak communication capacity and his age.

But the change in the polling tells me that surveys on "the economy" don't solely measure an economic reality. Apparently, in some part, they do heavily measure vibes. If we feel hopeful about the future, the world around us looks better. This can't entirely hide material realities, but it actually does help change our perceptions. (I'm sure some physicists have thoughts about how this works.)

In light of what's happening with current economic opinions, I can finally make sense of this amazing chart from last spring: 

Majorities of people polled in the electoral battleground states have thought their personal economic well-being had been getting better for a couple of years. Yet something was also convincing them that the country at large was doing poorly. I always was gobsmacked by this finding too. (As far as I know, no one has published an updated version of this question.)

Kamala Harris's attractive candidacy is apparently measurably restoring confidence in our future.

When Democrats hold office, jobs are created

A couple of charts to ponder. 

Simon Rosenberg, that effectual cheer leader for a Democratic Blue Wave over at Hopium Chronicles, always reminds us that Democratic leaders create jobs. Here's his version:

Washington Post data journalist Philip Bump creates his own version of this information -- and what this responsible guy shows is not so different.

Bump is a careful reporter. He offers qualifications.

... caveats can be sprinkled over all of this. Job growth under Biden was increased to some extent because employers were getting back up to speed after layoffs at the outset of the pandemic, for example.

So what happens if we take just the middle two years of Trump’s and Biden’s terms and compare them? That eliminates the covid effects for Trump and the boost at the outset for Biden. It also gives a year during which their policies could be expected to have had an effect.

In 2018 and 2019, under Trump, the country added 4.3 million jobs. In 2022 and 2023, under Biden, it added 7.5 million jobs.

You don’t have to be a sports whiz to see that seven puts you ahead of four, either.

Still, it's a someone amazing picture. I had not intuited this and I lived much of this economic history. And if enabling people to find jobs is what you think makes for a good country, it contains a blunt conclusion. Dem leadership makes life better for most people.

We're schizoid about the economy

 

This graphic is driving me nuts. Do click on it to get the full impression.

The Wall Street Journal asked potential voters in the seven states generally believed to be where the fall Presidential election will be decided: "Has the U.S. economy, or your state's economy, gotten better or worse in the last two years?" 

 

This shows the result: in all those states, more voters than not thought their own local, familiar, economy had gotten better. But overall, by a lot, they thought the national economy had gotten worse. 

WTF?

I don't know what is going on here. Somehow there is a huge disjunction between what respondents believe and their (lying?) eyes. Is this a hangover from the shock of a pandemic that closed the whole thing down abruptly and only reopened in fits and starts? Are they absorbing mass (or small) media that tells them that things are awful? Some other cause?

 

What do respondents envision when asked about "the economy"? I suspect that the measues that shape our answers to that question  may differ a lot. For some it might be, am I making enough money to live comfortably? For others, it might mean something more like, can I plan for a bigger and better future -- buying a new car, taking out a mortgage on a residence, taking a vacation?

 

Please leave any explanations you can think of in the comments.

 • • •

To try to get a better sense of this, I ask myself how I'd answer. As a resident of San Francisco, I'd certainly say the local economy was getting worse: we have enjoyed a city economy based on commuters and these folks just aren't coming, while a lot of workers from the tech boom sector are getting laid off.

On the other hand, the national economy looks wildly good -- pretty much anyone who wants a job can get one; wage increases are exceeding inflation. I find the national economic pessimism inexplicable. How do you explain it?

A "beautiful and terrible" story

Noah Smith captures gracefully how industrialization is spreading around the globe. His economic techno-optimism can feel cloying -- but he's onto something here.

In my last post, I predicted how manufacturing would spread to India and other developing countries in South and Southeast Asia. Basically, India will start out doing low-value assembly work using imported tools and components, and then gradually work its way up the value chain. Right now, in terms of its position in the supply chain, India is about where China was in the early 2000s.

Viola Zhou and Nilesh Christopher have a wonderful article about what Indian industrialization looks like on the ground. They traveled to a Foxconn factory in southern India, where Apple has shifted some iPhone production in order to diversify out of China. They found that many of the engineers that have been brought over to train and supervise the Indian factory workers are themselves Chinese. Much of their reporting focuses on the interaction and culture clash between the factory’s Chinese and Indian workers.

The story that emerges is a very familiar one. The Chinese supervisors think the Indian workers are slow, lazy and undisciplined — just as the British once thought of German and Japanese workers, when those countries were first industrializing. Industriousness is learned; it proceeds from industrialization. The people who first come to work in the labor-intensive factories are mostly women, looking for independence and an escape from rural life (and probably advantaged by having small fingers). The Indian factory girls are recognizably similar to their Chinese predecessors, or their British forebears centuries ago.

The Mill Girls of Lowell, Mass. via the National Park Service

This is the universal tale of industrialization, and it’s a beautiful and terrible one at the same time. It’s a story of ruthless labor exploitation, urban ennui, and harsh working conditions. But it’s also the story of workers escaping what Marx called “the idiocy of rural life”, finding their own way in the world, making money and winning their independence. And it’s the story of a country that is primed to become much richer in the near future. 

We know how this story typically ends, too. Indian factories will become more automated; salaries will rise and assembly line jobs will become fewer and more technical. Indians will move into higher-paying service jobs with better conditions. Indian companies will move up the value chain, learning how to make tools and components, eventually creating their own brands and competing with China and the rest of the industrialized world. And then Indian engineers will be off to the next poor country — Bangladesh? Ethiopia? Nigeria? — to start the whole process over again.

So far, across the globe, most humans have welcomed abundance and forgotten the miseries along the way. That seems to be who we are.

Keep up the good work

It seems worth noting that the United States is doing just fine -- except we have right wing nihilist MAGA Republicans.

It's not complicated. Click to enlarge.

Here's Wapo columnist Fareed Zacharia, no leftist radical:  

The United States’ debt ceiling crisis is, once again, provoking the usual commentary about the country’s presumed dysfunction. But the truth is that this unprovoked madness, causing self-inflicted wounds, is taking place against a backdrop of astonishing strength.

The facts cannot be disputed. The United States has recovered from the coronavirus pandemic faster than any major economy in the world. As Bloomberg’s Matthew A. Winkler recently pointed out, unemployment is stunningly low. Gross domestic product growth has grown at three times the average pace as under President Donald Trump, real incomes are rising, manufacturing is booming, and inflation has eased for 10 straight months. Even the budget deficit, which was at 15.6 percent of GDP at the end of the Trump presidency, has dropped to 5.5 percent of GDP at the end of last year.

... Unlike most rich countries, the United States has a strong working-age cohort that will not shrink, thanks to immigration. We still take in more than 1 million legal immigrants per year on average. ...

We elect Democrats to keep it that way.

For anyone who needs or wants to understand US immigration

Our historical understanding of immigration to the United States is cloudy, full of misconceptions, and hard to make sense of. The legal rules which govern immigration in 2023 are tough to decipher -- and, aside from past eras when nativism successfully outlawed most migrant arrivals, always have been a tortuous maze.

In 1994 I was plunged into considerable responsibility for fighting against a state initiative campaign (Prop. 187) which aimed, unfortunately successfully, to make life hell ford California immigrants. I needed to learn about immigration, fast. It proved surprisingly difficult to find clear, authoritative information about migrants and the system they lived within as well as their true impact on existing California society -- not to mention what their individual lives and prospects were like.

Streets of Gold: America's Untold Story of Immigrant Success by academic economists Ran Abramitzky and Leah Boustan provides an up-to-date primer on precisely these issues, as well as a history of immigration since 1850. I sure could have used something like it back in the day.

Our aim in this book is to rebuild the story of immigration to America from the ground up, uncovering the patterns that the patterns that emerge from data on millions of immigrants' lives. ... The data gives us clues about why immigrants chose to come to the United States, and tells us when they left school, how well they spoke English, the occupations they held over their work lives, their earnings, whom they married, the names they chose for their children, and their children's outcomes as they became adults.

Some of the myths and issues they examine include:

• the reality, and the difficulties, of economic mobility for newcomers
• whether current immigrants learn English rapidly (not in the first generation)
• whether current immigrants assimilate to US customs as quickly as previous migrant generations (yes)
• do new successful arrivals hurt the US born (no)
• does global diversity benefit all of us, culturally and economically (yes, emphatically)

What Abramitzky and Boustan bring to the subject is a database of immigrant history of which they are almost inordinately proud. They began their efforts by sucking information uploaded by amateur family historians out of the Ancestry.com service. When the company noticed their work, it "worried that some computer bot was downloading their data to package and resell." The company sent a "cease and desist" letter. After conversations, the site welcomed their project. They then added in everything they could find from historical census files, Social Security records, tax records and birth certificate files. They were both able to follow the life histories of individuals and put those histories in the context of the picture drawn by the entire data set.

Individually, each record reflects a life quietly lived -- perhaps as a beloved teacher, or a hopeful parent, or a kindly neighbor -- achieving no fame as a result of their strivings. Together, these stories paint a portrait of the immigrant experience that largely overturns conventional wisdom.

For anyone needing to learn the basics about US immigration history and policy, I would recommend this book unhesitatingly. People will keep on coming; that's not easy for them or simple for those of us already here. But when you steal a continent from its native inhabitants and make the resulting polity unimaginably prosperous and relatively safe and secure, expecting to keep the world out is criminal folly and impossible. And the newcomers benefit us all.

Not going to happen, but consider the implications

Having written yesterday about how novel tax, currency, and banking measures adopted by President Lincoln's 1961 Unionist Congress put the country on track to become a 19th and 20th century economic colossus, it comes as no surprise to me that contemporary Republican Congress clowns are trying to undo these Civil War-era structures. That they don't believe in the full citizenship of all of us should be obvious; that they don't have the faintest notion how the economy that enriches them and their donors functions might be a little less obvious.

Here's historian and Substacker-extraordinaire Heather Cox Richardson explaining:

One of the promises House speaker Kevin McCarthy (R-CA) made to the extremist members of the Republican conference to win his position was that he would let them bring the so-called Fair Tax Act to the House floor for a vote. On January 8, Representative Earl “Buddy” Carter (R-GA) introduced the measure into Congress.

The measure repeals all existing income taxes, payroll taxes, and estate and gift taxes, replacing them with a flat national sales tax of 30% on all purchased goods, rents, and services  ...The measure abolishes the Internal Revenue Service, leaving it up to the states to administer the tax.

The bill says the measure will “promote freedom, fairness, and economic opportunity.” But a 30% sales tax on everything doesn’t seem to do much for fairness or economic opportunity for all, since it would, of course, hit Americans with less money to spend far harder than it would Americans with more money to spend. And the end of income, gift, and estate taxes would be a windfall for the wealthy. 

... Members of the Republican Party invented the U.S. income tax during the Civil War, and they created the precursor to the IRS to collect it. To find money to fight the war, they raised tariffs on common products but immediately turned to the novel idea of an income tax, and a graduated one at that, to make sure that “the burdens will be more equalized on all classes of the community, more especially on those who are able to bear them,” as Senator William Pitt Fessenden (R-ME) put it. 

... The Republicans then quite deliberately constructed a national system for collecting the new taxes. In the midst of the Civil War, they urged their colleagues to imagine what would happen if a disloyal state were permitted to manage the collection itself. A Democratic legislature could simply refuse, and the government might perish for lack of funds to support the troops. The government had a right to “demand” 99 percent of a man’s property for an urgent necessity, [Vermont Senator Justin Morrill] said. When the public required it, “the property of the people…belongs to the Government.”

Today’s Republicans are taking a position opposite to the one that the men who formed the Republican Party did during the Civil War. They want to get rid of the income tax and put state governments in charge of the nation’s revenue system....This radical tax bill strikes a blow for states’ rights, much as the southern leaders the original Republicans stood against did in the 1860s. It is far easier for a minority to take over a state and impose its will on a majority there than it is to do the same at the national level. And Republicans are definitely working to cement their control in the states.

Think what Florida governor Ron DeSantis or Texas's Greg Abbott might do if taxation for government depended on them ... basically, forget government for anyone disfavored by their white nationalist "base."

This is not going to happen. But it really does seem we are re-fighting the Civil War of mid-19th century.

But is it paid for?

What would our country be like if most of the goofy Republican caucus in Congress walked away from their jobs for some goofy reason, and Democrats suddenly had majorities which could try to implement their legislative priorities? The well-thought-out policy ideas of Elizabeth Warren and Bernie Sanders would instantly be on the legislative agenda and politicians would jockey to find ground from which to distinguish themselves in the novel environment. Add in an existential war in progress that had to be funded by previously unheard of expedients and things might get radical.

That's a fair parallel to where newly elected President Abraham Lincoln and the then-newly consolidated Republican Party found themselves in 1861 when southern states tried to end the Union -- and thus end the experiment in constitutional government which was the federal United States.

We can be confused reading this history today because 1) the Republicans were both the progressive force and the mostly anti-slavery political party and 2) the Democrats were the hide-bound conservatives whose attachment to states' rights hamstrung government action and support the slavery system. In the century and a half since, our political parties have roughly traded sides.

Roger Lowenstein is an American financial journalist and writer who recently explored aspects of governance in the 1860s in Ways and Means: Lincoln and His Cabinet and the Financing of the Civil War.

This is a book that probably tries to do too much. Others have written gracefully about Lincoln's Team of Rivals, his contentious Cabinet. I didn't really care about how the Confederacy tried to solve its fiscal problems; my understanding of Confederate fiscal history is that what happened there was mostly decided by the failure to bring Britain in on the side of the South in the war.

What interested me here was what the Republican Congress of 1861 accomplished with its new freedom of action. And Lowenstein offers plenty that is interesting. This prologue helps with imagining Republican priorities which were not what we might assume in 2023:

Few northern whites had much to do with Blacks, slave or free, and even fewer supported abolition. They were opposed to slavery's extension mainly because they preferred their own societies to the slave societies of the Deep South. Whigs, and later Republicans, advocated a system "free labor," which connoted not just the absence of slavery, but a positive culture of small farms, cottage industries, and independent craftsmen. ... What northerners truly abhorred was the South's economic and social backwardness. The South was less urban, less educated, woefully under-industrialized. ... Republicans did not plan on a war in 1861, but their social vision prepared them for one. Their ideal of a stronger and larger central government not only enabled them to harness the necessary resources to win the war, it encouraged them to do so in a way that helped bring about a modern and dynamic industrial society.

The accomplishments of the freed-up Republican Congress were great -- and the consequences unexpected when they finally were able to pass what northern social movements had envisioned. Lowenstein labels the Congress of December 1861-July 1862 the "Forgotten Congress."

... [they] enacted a blizzard of legislation that made the federal government, for the first time, a visible presence in the lives of ordinary Americans. ... It broke from the "governing least" philosophy of Jefferson and legislated in the spirit of the "more perfect union" advanced by Lincoln. It abandoned laissez-faire and interposed a visible hand in the hope that, also in Lincoln's words, "every man [might] have the chance." Congress enacted a protective tariff ... and enabling legislation for a transcontinental railroad. It involved the federal government in agriculture, education, and land policy. It legislated an income tax and refocused the war's purpose to include a frontal attack on slavery. It could almost be said that it created the government itself. ... They legislated boldly and to the perceived edge of constitutional license. A San Francisco newspaper approvingly declared, "Constitutions are made for peace. We are at war." ... On the whole, they were less intent on preserving, more on building and improving. ...

By war's end and the defeat of the South in 1965,

... it was now, as it had not been before, the federal government's business to help educate farmers, to preserve natural lands, to fix the standard railroad gauge, to nurture the sciences, to operate an expanded postal service, to regulate banks, to encourage immigration. Even abolition, on the surface a stand-alone event, was enabled by the new ideology of centralism.

... The purposes of the government were also elevated in the minds of Americans. They looked to it, as they hadn't before, to solve national problems. Since the government had freed the slaves, people expected it to address other pressing issues, such as low farm prices, labor disputes, the power to the railroads, and monopolies. ...

Though in the war's aftermath the Republicans were soon captured by the industrialists and plutocrats of the Gilded Age, in a vital moment, they gave the country its most benign institutions.

• • •

I was curious about this book because a great-great grandfather of mine played a part in its story. Elbridge Gerry Spaulding (1809-1897; yes, named for the relative and Massachusetts governor who gave his name to our present dubious redistricting processes) had been a Buffalo mayor, an early adopter of the new Republican Party, and a successful banker who sat in the Forgotten Congress. I'm sure the idea was floating around in the wider policy ether, but he was the guy who proposed that the Treasury could fund the war with "greenbacks," the paper currency that led to the current dollar. Previously government, and especially war, had been funded by a small stream of tariff revenue and by borrowing from banks and bankers. That was where the cash was. Banks were chartered by the separate states and they all issued their own notes; this was not a system which inspired confidence in paper money.

By the winter of 1861-1962, the federal government was desperate for cash. According to Lowenstein, Spaulding proposed a bill to pay for the war that was "revolutionary."

As if by a conjurer's trick, it authorized the Treasury to print United States Notes to distribute to soldiers, suppliers, and others. The catch was that, unlike virtually every other bill in circulation, Spaulding's notes would not be redeemable for silver and gold. This meant the government would not be constrained by the supply of metal; it could print as much as it liked, or at any rate as much as Congress authorized.

And Spaulding's notes would not pay interest. Today, we scarcely pause to consider that the money in our wallets does not yield a return. After all, it is "money." In 1861, virtually all government paper did pay interest. That was the inducement for holding it. Finally, Spaulding's paper would not have a maturity date. This, too, was unusual. A maturity date was a pledge that the paper could be exchanged for something of value at a specified time. But these notes would not be redeemable. They were issued for perpetuity.

To the Civil War mind, these features were both shocking and blasphemous. ... U.S. Notes would be "legal tender" -- they would be money by proclamation, that is, by government fiat. They would suffice for all debts and commercial exchanges; acceptance would be compulsory and universal.

The twists and turns of getting the greenback bill passed were many; Lincoln supported it, but left it to his doubtful, but desperate, Treasury Secretary to do the legislative lifting. Once passed, the system made it all the more obvious that a system of state-chartered banks could not serve the Union cause. Financial entrepreneurs jostled to cash in on the reform. The Confederates tried something similar but you have to win on the battlefield to make a fiat money system work.

By the end of the war, both enhanced revenue and national banking had been added to the federal arsenal, creating something akin to the financial system as we have known it. That system might be due for another upgrade; I am sure Elizabeth Warren is working on it. Imaginative and determined individuals make these things happen, remote as they may seem.

Inflation blues ...

Inflation is scary. When prices go up, we all wonder, "will I be able to afford gas? should I buy hot dogs instead of hamburger?" To most of us, inflation means mostly the higher prices we pay every day. But to a small business, inflation means a major disruption in the ecosystem in which they strive to survive.  

Here's how a wonderful, small, creative business run by women with which I've had past dealings describes what inflation looks like to them. It's one of the clearer descriptions of an economic phenomenon I've ever read. Give it a read.

• Small business miseries

Our world has been on a very wild ride since the start of 2020. Our latest woe is inflation. 

Here at [our little business], we are also struggling with inflation. 

Inflation is a two-sided coin for a good business. We must keep our employee's wages up to combat their struggle with purchasing. ... we are doing our best to ensure our employee's economic welfare. 

The other side of the coin is a business's need to purchase goods and services to run said business. Those costs are figured into the prices of a product. When expenses go up, the cost of a product goes up.   

If every business raises the cost of their products, there is a cascade effect on the entire economy. It's a crazy cycle that can drive the economy into a tailspin. 

Our raw materials are more expensive. The services we use, especially shipping, are more expensive. And our wages are through the roof. Yet for the next six months, we are going to hold the prices of our quilts where they are. 

We are willing to forgo profits and break even for the next six months to see what happens to the overall economy. 

We hope we don't need a huge price increase in January. But the inflation rate is over 8% right now. 

[Finally, here's the pitch:] If you are considering having a Too Cool T-shirt quilt, this is the time!

Yes, I'm reproducing their ad here, because they deserve the publicity for the lucidity with which they explain what can feel like a mysterious, evil force of nature. 

• • •

• People protecting themselves

And here's one of my favorite economic writers, Adam Tooze, offering some home truths about what inflation and economic policy responses means to workers and our societies. Like the small business owners, he too is realistic.

The BIS [Bank for International Settlements] may be of the view that on welfare and social justice grounds, low-inflation regimes dominate higher inflation regimes. But it nowhere spells out that argument. If that assumption does not hold, then favoring a low-inflation regime implies a distributional and a political choice. 

And, more fundamentally, to view social and economic power, strictly from the point of view of price and wage setting is reductive. Indeed, it is reductive to view those institutions simply from the point of view of distribution. 

Institutions of collective bargaining are not merely mechanisms for wage and price setting. One may value collective bargaining institutions in their own right, as complex articulations of social reality and as places where solidarity finds organized expression. One may value them as expressions of alternative visions of social balance. Up to the 1980s, organized labour was the backbone of social democratic politics and a partner of liberalism in the fashioning of democracy in capitalist societies. 

Trade unions and structures of collective bargaining at all levels mattered not only because they counterbalanced elite power, but also because they gave intelligent and articulate expression to working-class grievances. They framed inequality in terms of social realities rather than imaginary enemies. Historically they did so in direct opposition to other forms of popular political mobilization - like fascism, for example. In recent decades it is not implausible to suggests that the rise of working-class support for nationalist populism is directly related to the decay of those collective institutions of labour organization. ...

Yes -- strong unions should help workers navigate turbulent economic seas with some hope of stability and safety. This is a moment in which unions making a comeback -- looking at you Amazon and Starbucks workers -- can breathe new energy into our struggling democracy.

Good news from California

Too often, it feels hard to believe that the state of California is doing something right. Wealth disparities between haves and have nots are so vast; the gas our car-dependent culture requires is so expensive; our big cities seem a little squalid these days. So it's heartening to see some good news about the post-pandemic recovery. It seems to be advancing the well-being of some of us who most need it.

PPIC explains in part: 

...Black and Latino unemployment rates are closer to pre-pandemic levels than those of other groups: 6.5% and 5.5% in the first quarter of 2022, respectively. These patterns are driven largely by sectors of work. Though Latino workers are overrepresented in sectors that saw the largest pandemic downturns, like leisure and hospitality, they are also overrepresented in construction and agriculture jobs, which have fared relatively well. Transportation and warehousing is one of the more common industries of work for Black Californians, and the strength of that sector during the pandemic also contributes to the stronger recovery pattern here.

An anachronistic empire of slave labor

My apprehension of World War II is colored by ancestry, though I was not born until shortly after. That is, I grew up knowing that "The War," meaning the war in Europe to defeat fascism and Nazism, was the central and defining experience of my mother's life. Perhaps the 9/11 attacks played a similar role in some current generations' lives -- an historical experience which colors deeply all that comes after.

My mother experienced The War as an extended crisis. Unusually for her class and location -- I think because she encountered emigre Germans, refugees from the Nazis -- she viewed Hitler as a threat not only to her Jewish and German friends, but also to her own way of life. When I read Erik Larson's In the Garden of the Beasts: Love, Terror and an American Family in Hitler's Berlin, I realized that she was almost certainly in the audience for the diplomat William E. Dodd's anti-Nazi speaking tour after he returned from Germany.

What made The War such a long, draining crisis for people like my mother was that her fellow citizens didn't see the threat coming or didn't want to look. Mother was a moderate Republican; she was out of phase with her peers, agitating against German expansionism throughout the 1930's, watching in horror as Hitler absorbed Austria and Czechoslovakia, listening on the radio to the fall of France to Hitler's armies, and to the bombing of London. "America First" politicians were slow to take up what she feared was a uncertain fight to preserve human decency. It was an agonizing time to be her kind of engaged citizen. Was Nazi barbarism about to overrun everything?

The central insight of economic historian Adam Tooze's The Wages of Destruction: The Making and Breaking of the Nazi Economy was that this terror was somewhat misplaced. Hitler's terrible Aryan empire never had a chance against the productive capacity of American arms, shipped first to Britain and later to the Soviet Union. In fact, even a Russia degraded by vicious Stalinist purges and erratic central planning, had the economic capacity to resist and defeat the Germans. The German state was a second rate economic power that Nazis tried to organize to overshoot its actual strength -- and its eventual collapse was all but inevitable.

For all the misery and murder, barbarity and brutality, Nazism was not going to win The War or the future. I found Tooze's book fascinating, but this may be an acquired taste. He proves his case in vast detail and summarizes in broad strokes.

Once Germany had engaged both Britain and the Soviet Union and once the United States threw its weight fully into the scales, the odds against the Third Reich were bound to be overwhelming. In 1941, before the German invasion of the Soviet Union but also before the American economy hit full stride, the combined GDP of Britain, the Soviet Union and the United States exceeded that of Germany by a factor of 4.36 to 1. Similarly, in the 1930s the combined steel output of Britain, the Soviet Union and the United States had been almost exactly four times greater than that of Germany and that at a time when American industry was well short of its productive peak. By 1944 the ratio of steel output, even if we add the output of Belgium, France and Poland to the German side, was 4.5 to 1 against Germany. What Germany faced by 1944 was simply the crushing material superiority that German strategists had always feared.

Tooze demands recognition that, in addition to Nazism's ideological and all-too-successful attempt to exterminate Europe's Jews, German economic planning was also based on starving or murdering the continent's Slavic people's to make room for German imperial expansion. The Nazis were envious of French and British colonial empires and looked for potential slave labor of their own.

The point is not that Germany’s imperialism in Eastern Europe represented a regression into atavistic barbarism. The Nazi programme of genocide was certainly barbaric. But, as we have seen, it was tied to an ambitious project of colonial settlement and violent modernization. The point is not that Nazi racism was atavistic. The point is that it was anachronistic. ... 

[Germany's invasion of Russia] was a belated and perverse outgrowth of a European tradition of colonial conquest and settlement, a tradition that was not yet fully aware of its own obsolescence. ... 

... By the 1940s, the nineteenth-century map of economic and military power, centred on the established states of Western Europe, no longer existed. This was the most basic fallacy underpinning the effort by the Third Reich to create an empire in the East. America’s emergence as an economic superpower on the one hand and the explosive development of the Soviet Union on the other had fundamentally altered the balance of global power. ... 

... Whereas the incarceration of more and more potential workers in murderous concentration camps was clearly irrational from the point of view of the overall war effort, from the point of view of the individual employer the concentration camps were often a godsend. Even in 1944, Himmler was still able to provide new workers. Though these people were quickly worn out, the advantage of the SS was precisely that they were able to offer their industrial clients an apparently limitless flow of new inmates.

Tooze concludes that it is inadequate to concentrate entirely on the Nazi's ideological intent; the economic order they aspired to impose was almost equally murderous.

Obviously, ideology was decisive in the last instance, especially in relation to the Judaeocide. There could be no other reason for killing one group with such awful thoroughness. The assumption of a racial struggle was an unalterable given in the Nazi worldview. On the other hand, it is also clear that, as the war ground on, sustaining the war effort increasingly came to override every other preoccupation of Hitler’s regime.

I found this book broadening. As far as I can tell, Tooze's estimation of the Nazism's essential economic weakness is now generally accepted by historians, a change in emphasis from previous accounts. We see differently as we move farther away in time. My mother wouldn't have accepted Tooze's thesis for a minute -- the danger seemed too immediate.

Is the United States up to the challenge?

In Shutdown: How Covid Shook the World's Economy, economic historian Adam Tooze picks up where Crashed, his wide ranging account of the Great Recession and subsequent financial imbroglios, left off. He acknowledges that this story of the pandemic's impacts is in medias res, possibly premature, and unfinished. But there's a big story here; in this volume Tooze adds to his apparent ongoing enterprise of shifting accounts of our economies out of the realm of abstruse statistics and into understandable narrative history. The book is audacious in its project and very readable.

It would be beyond me to summarize thoroughly,  so I'm not going to try. But I do want to write a little about how Tooze's account confirms and amplifies a disjunction that has seemed to me obvious but not universally incorporated in our understanding of U.S. political and economic life in this century. We live in a country where the places that generate the national wealth often cannot take the reins through the constitutional political system. If we take seriously that big money rules, that's bizarre. Here's a simple numerical description from Shutdown:

Biden won only 509 counties, but they were home to 60 percent of America's population and generated 71 percent of national output. Trump was left with the rest. In the 2547 counties that voted for Trump, blue-collar jobs outnumbered white-collar. In Biden's counties, white-collar jobs clearly predominated. Of the hundred counties in the United States with the highest percentage of college degrees, Biden took 84 to Trump's 16. As recently as 2000, Bush had managed 49. Back in 1984, 80 percent of the most educated counties in America had gone for the Republicans.

That's not what one might expect from a polity in which the logic of so-called "free market"capitalism is trumpeted, usually by both political parties. The pandemic has highlighted this contradiction between generation of wealth and who governs.

The general crisis of neoliberalism in 2020 thus had a specific and traumatic significance for America and for one part of the American political spectrum in particular. The vision of American government crafted by successive Democratic administrations starting with Woodrow Wilson and FDR gave American liberals tools with which to respond to the coronavirus challenge. Even the new generation of American radicals led by Alexandra Ocasio-Cortez could find things to like about the New Deal. 

By contrast, the Republican Party and its nationalist and conservative constituencies suffered in 2020 what can best be described as an existential crisis, with profoundly damaging consequences for the American government, for the American Constitution, and for America's relations with the wider world. 

This culminated in the extraordinary period between November 3, 2020 and January 6, 2021, in which Trump refused to concede defeat, a large part of the Republican Party actively supported an effort to overturn the election, the social crisis and the pandemic were left unattended to, and finally on January 6, the president and other leading figures in his party encouraged a mob invasion of the Capitol. 

As the constitutional storm clouds gathered in 2020, American business aligned massively and squarely against Trump. Nor, as we shall see, were the major voices of corporate America afraid to spell out the business cost for doing so, including shareholder value, the problems of running companies with politically divided workforces, the economic importance of the rule of law, and, astonishingly, the losses in sales to be expected in a civil war. This alignment of money with democracy in the United States in 2020 should be reassuring, up to a point. ..

Tooze reminds us repeatedly that this alignment might not have survived if the choice had been between Trump or Bernie Sanders (he ignores the also-dangerous Elizabeth Warren). He goes on:

As far as corporate America was concerned, 2020 confirmed its unease with the political culture of the GOP, a tension that first became clear in 2008 with the nomination of Sarah Palin as John McCain's running mate. America's corporate leaders were always of two minds about Trump. They like the 2017 tax cuts and his agenda of deregulation. Some maverick billionaires continued their support, but few senior business leaders wanted Trump's reactionary cultural politics. The owner of a small business might set the tone how he or she pleased. The vast majority of them were solidly pro-Trump. Conversely, it was well nigh unthinkable to run a large corporation in the United States in the summer of 2020 while simultaneously denying the seriousness of the pandemic and the cause of racial justice. What corporate America wanted was not civil war and a Darwinian push for herd immunity, but social peace and an effective containment of the epidemic.

CEOs of JPMorgan Chase, Blackrock, and Goldman Sachs threw themselves into pressing a peaceful transition of power when Trump lost the election. The Chamber of Commerce was part of the chorus against Trump's Big Lie. Tooze credits these forces with enabling established institutions to hold against the Trump coup attempt.

The U.S. military refused to have anything to do with the Trumpists... For all the furor over the transition, in the weeks prior to January 6, America's political class had already reached a basic compromise to stave off the actual threat of the moment -- the looming collapse of the country's fragile welfare system. [In December, for each party's own reasons, Congress had approved new stimulus checks.] ... A polity that could agree on practically nothing else did in the end agree on people's need for money. ... It was this that accounted for the jarring juxtaposition on January 6. Even as the mob cavorted in the congressional chambers on live TV, the S&P 500 surged. ... What boosted the markets on January 6 was the knowledge that even if Nancy Pelosi and her colleagues were sheltering for safety under armed guard, one thing was now clear: the fiscal taps were staying open.

I like to think there was more to this moment than Tooze reports, that there were pro-democracy actors outside the capitalist class. Many of the forces in the dangerous transition period were part of a large, democratic (small "d") rabble that had organized itself over the anxious months before the election. I think particularly of Barton Gellman's September 2020 article The Election That Could Break America which raised the alarm among the high-attention reading public, as did Rosa Brook's Transition Integrity Project among journalists and pundits.

But there was also preparatory work among the more activist segments of the Democratic base. I was astonished in the run-up to November 3 to attend mass Zoom meetings of union staff and activists preparing for an attempt by Trump to steal the election. The usually sclerotic AFL-CIO leadership shared a visual description of the steps involved in moving from Election Day to Inauguration -- TV networks "calling" the states based on tallies, state certifications of the results, Electoral College acceptance of state certified results, and confirmation by Congress of the Electoral College outcome on January 6. People don't come born knowing this stuff--it is (was) pretty arcane. Union leaders meant to create a disciplined mass of leaders and members who could understand what was happening and be roused to turn out to defend the process. 

A less centralized and coherent, but no less significant, collection of community-based civil society organizations that had worked to replace Trump with Biden also prepared to oppose a coup attempt. In late January 2021, Alexander Burns reported on their careful preparations:

At each juncture, the activist wing of the Democratic coalition deployed its resources deliberately, channeling its energy toward countering Mr. Trump’s attempts at sabotage. Joseph R. Biden Jr., an avowed centrist who has often boasted of beating his more liberal primary opponents, was a beneficiary of their work. 

... Worried that Mr. Trump might use any unruly demonstrations as pretext for a federal crackdown of the kind seen last summer in Portland, Ore., progressives organized mass gatherings only sparingly and in highly choreographed ways after Nov. 3. In a year of surging political energy across the left and of record-breaking voter turnout, one side has stifled itself to an extraordinary degree during the precarious postelection period... 

Interviews with nearly two dozen leaders involved in the effort, and a review of several hundred pages of planning documents, polling presentations and legal memorandums, revealed an uncommon — and previously unreported — degree of collaboration among progressive groups that often struggle to work so closely together because of competition over political turf, funding and conflicting ideological priorities.

For once, the nonprofit activist sector resolved not to hang separately. If you want to feel better about the ungainly mess that is the broad progressive coalition, read Mr. Burns' article.

Adam Tooze ended his snapshot of the pandemic's effects in April 2021. He sees trouble ahead for the Biden presidency and for the country. Our contradictions have not weathered the pandemic well.

... as 2008 demonstrated and 2020 confirmed, the GOP is no longer a party with a vision of government either in the long or even the short term. It has revealed itself as a vehicle for the undisciplined pursuit of particular interests and the expression of affect rather than considered national policy. 

There are, of course, massive modernizing forces at work in the United States. For better and for worse, they are aligning increasingly unambiguously with the Democratic Party. As they have demonstrated in successive presidential elections, the Democrats are majoritarian ... [but thanks to constitutional systemic distortions] the grip on power of this modernizing coalition is frustratingly weak.... The Biden presidency's first order of business is to attempt to restore coherence ... For all the enthusiasm surrounding the early months of the Biden administration, the haunting question remains: is the United States as a nation-state capable of responding in a coherent and long term fashion to the challenge ...? 

... If our first reaction to 2020 was disbelief, our watchword in facing the future should be: "We ain't seen nothing yet."

What's really behind inflation?

There are plenty of opinions, some conflicting.

This may not be the most judicious take on why food and gas prices are rising, but it is a certainly part of the story. Big businesses are raising prices because they know they can. Pandemic battered consumers find no alternative but to pay up.

Business leaders are admitting that corporations are using the narrative of hyperinflation as an excuse to raise prices on you and increase profits for themselves. ... The largest corporations in America have never made more money. ... Corporations are seizing the opportunity to engage in massive profiteering because they can.

The Republican Party is there for the one class it always coddles: plutocrats.

Christopher Ingraham of  The Why Axis thinks he knows what these high profits should mean:

What it says to me is that firms have plenty of wiggle room to create better conditions for their employees — they can clearly afford the higher pay, more generous benefits and more flexible arrangements that workers are increasingly demanding.

The Washington Post's super smart (really, pay attention to her), plain-speaking business columnist Catherine Rampell believes she knows how to describe the current inflation:

The main reason price growth is up has to do with constrained supply not keeping up with booming demand. That is, the pandemic has resulted in worker shortages, supply-chain disruptions and other bottlenecks in the United States and abroad. These problems are happening at the exact same time that cooped-up consumers are eager to buy even more stuff than they did pre-pandemic.

... Arguably, recent U.S. fiscal policy may have exacerbated this dynamic: Biden and the Democrats enacted stimulus payments and other government transfers earlier this year, which gave consumers more cash to spend. Now consumers are spending that cash.  

...Aside from some vague rhetoric about Democrats’ “big spending” habits, though, those checks are not really what Republican politicians are criticizing Biden for. Perhaps with good reason: The spring stimulus checks were extremely popular, including among Republican voters. ...  So they’re peddling “war on Halloween” hokum instead.

The chair of the Republican National Senatorial Committee (the fundraising arm of GOPer campaigns) Florida Senator Rick Scott announced to the Wall Street Journal: "This is a gold mine for us." 

You can always be sure -- the current Republican Party doesn't care who gets hurt, as long as they hold power.

No more graveyard shifts?

The Great Resignation -- maybe we should call what we're living the Great Labor Discontinuity -- has confused and confounded economists. Having been given some involuntary breaks by the pandemic from the endless of treadmill of meaningless jobs, some people seem to be thinking differently about work. And some are no longer willing to do jobs that destroy  body, mind and spirit.

Erudite Partner asks: An End to Shift Work?

Your doctor can’t solve your shift work issue because, ultimately, it’s not an individual problem. It’s an economic and an ethical one.

There will always be some work that must be performed while most people are sleeping, including healthcare, security, and emergency services, among others. But most shift work gets done not because life depends upon it, but because we’ve been taught to expect our patio furniture on demand. As long as advertising and the grow-or-die logic of capitalism keep stoking the desire for objects we don’t really need, may not even really want, and will sooner or later toss on a garbage pile in this or some other country, truckers and warehouse workers will keep damaging their health.

We are not even at the beginning of seeing what the Discontinuity might imply.

So much comes back to John Maynard Keynes

You know how they say everyone finds God in a foxhole? Well, by the same token, during a serious economic crisis, everyone finds Keynes. New Republic editor Michael Tomasky  

The world discovered that John Maynard Keynes was right when he declared during World War II that “anything we can actually do, we can afford.” Economic historian Adam Tooze

Who was this guy, this John Maynard Keynes, and why is he repeatedly invoked? Zachary D. Carter, a senior reporter at HuffPost, has tackled the question in The Price of Peace: Money, Democracy, and the Life of John Maynard Keynes, a sprawling biography and much more.

Carter's subject worked at the highest levels of British government on the problems (there were plenty!) of finance during both The Great War (1914-1918) and the Second World War (1939-1945). In between, he speculated successfully in stocks, criticized his country's political leaders, and articulated a vision of economics while teaching a coterie of brilliant students at Cambridge. After World War II, he helped create both the British welfare state launched by the Labour government of 1945-1951 and, reluctantly, the Bretton Woods international economic order which cemented the United States as the world's dominant power.

But Carter wants us to understand that my skeletal sketch here is inevitably inadequate.

Today Keynes is remembered as an economist because it was through the field of economics that his ideas exercised their greatest influence. College students are taught that he urged governments to accept budget deficits in a recession and spend money when the private sector cannot. But his economic agenda was aways deployed in service of a broader, more ambitious social project. Keynes was a philosopher of war and peace, the last of the Enlightenment intellectuals who pursued political theory, economics, and ethics as a unified design. He was a man whose chief project was not taxation or government spending but the survival of what he called "civilization" ... 

Keynes was a tangle of paradoxes: a bureaucrat who married a dancer; a gay man whose greatest love was a woman; a loyal servant of the British Empire who railed against imperialism; a pacifist who helped finance two world wars; an internationalist who assembled the intellectual architecture of the modern nation state; an economist who challenged the foundations of economics.

It's interesting to understand that this polymath mostly loathed the United States whose pragmatic, coalitional, bourgeois politics he understood poorly. Yet his influence has perhaps been greatest here and only through U.S. global predominance worked its back to countries he considered far more civilized.

... the history of Keynesianism is an intellectual history of American power, both its promise and its abuse ...

Keynes had a way of asserting home truths that took the economic profession aback. For example, in his most technical work, the General Theory he allows:

Enterprise only pretends itself to be mainly actuated by the statements in its own prospectus. ... Only a little more than an expedition to the South Pole, is it based on an exact calculation of benefits to come. Thus if the animal spirits are dimmed and the spontaneous optimism falters, leaving us to depend on nothing but a mathematical expectation, enterprise will fade and die; -- though fears of loss may have a basis no more reasonable than hope of profit had before.

No, he was not one for believing in the rationality of markets.

Carter highlights the central Keynesian insight from the Depression which has come down to us:

Excessive thrift -- otherwise described as underconsumption -- could cause economic trouble. ... a technical observation that carried radical political implications.

To get people back to work, they had to be able to buy things and thus to incentivize businesses to make salable goods would lead to creating jobs. In a world where such a thought was a novelty, this was genius. In our pandemic world, we've seen the cycle play out as financial stimulus that permits recovery from an induced artificial recession.

Keynes is both applauded and mocked for observing in 1930 that the productive power of modern capitalism should lead to a society in which people only needed to work for 15 hours a week for wages. They would be free to use the rest of their lives for self-education and creativity. Of course, he was wrong; late capitalism siphons more and more of working people's product to the owners, never sharing the goodies (the profits) with most workers. He more or less knew what would get in the way of his vision; we have been convinced we have pseudo-needs that keep us on the treadmill.

Keynes distinguished between human needs essential to survival and semi-needs whose 'satisfaction lifts us above, makes us feel superior to, our fellows. Needs of the second class, those which satisfy the desire for superiority, may indeed be insatiable.'

A lifetime lived within late capitalism makes that statement hard to assess. Do we really need all we're accustomed to want? Hmm...

Carter sadly concludes:

Keynesian economics were formulated as a defense against fascism, so it was appropriate that Keynes [and his intellectual allies] would join the war effort against Nazi Germany and Fascist Italy. But Keynesianism was also developed to prevent war, and it remains one of the great tragic ironies of intellectual history that the very catastrophe Keynes had attempted to avert for nearly two decades would be the event that finally demonstrated the viability of his economic ideas on the world stage.

Keynes makes a fascinating subject for biography. But chewing over the life of this strange and wonderful man is not all Carter has done in this volume. As I often do, I read this book by ear. So when Carter reported on Keynes' death in 1946, I was shocked to realize I still had six more hours of listening ahead. 

Carter follows the bumpy trajectory of Keynes' reputation and intellectual influence among economists and policy makers in the Western world up to the present. This was interesting -- I never previously had known why the right are such enthusiasts for Keynes' Austrian critic Friedrich Hayek nor all the ins-and-outs of Democratic economic eminence John Kenneth Galbraith's drive for political power. All fascinating, some relevant to today -- and more than I want to attempt to get in to here.

The Price of Peace demands a major investment of attention and cogitation. Highly recommended.

What's with Joe Biden?

Rebecca Traister, one of the best journalists around, has done it again -- announced what should have been our conventional wisdom but which had been unsaid. 

In a long, smart article about why the Biden presidency seems so much more novel, more unexpected, and more leftish, than many of us dared hope, she offers this: 

[Felicia] Wong [president and CEO of the Roosevelt Institute] put it more simply. “He’s so old,” she said, “that it turns out he’s actually pre-neoliberal.”

Biden came of age politically among vestiges of the New Deal coalition. He — like some of the other septuagenarians who really have been thanklessly agitating for reform over decades, including 78-year-old [Rep. Rosa] DeLauro, 79-year-old Sanders, and 74-year-old Barbara Lee — has a lived frame of reference for the fact that Democrats are capable of doing things differently. It’s just that since the 1980s, they’ve chosen not to.

This rings profoundly true to me. Politically, I too am of that pre-neoliberal political generation. I think it is the job of government to rein in greed, to control the cupidity, cruelty, and stupidity of an unconstrained market system. 

I always knew that Ronald Reagan was a carnival barker for the wealthy, for the racists, for robber barons who would destroy our inheritance in land and water. I mean, what else is someone who launched his presidential campaign with a states rights speech in Neshoba, MS, the site of some of the Civil Rights-era's most grisly murders of workers trying to register Black voters? What else is a California governor who claimed that trees cause air pollution?

Reagan normalized a lot of crap. Biden's administration is not only trying (fitfully) to clean up after Trump's incompetence and corruption -- his people are also trying to replace the perversion of government function that came in with Reagan. 

Sometimes an old codger has something to offer, so old it feels new again.

Post-pandemic economy comes into view

Just maybe, the last year's "Racial Reckoning" is having the material effect of putting systemic racism front and center of our descriptions of our reality. Consider this from Binyamin Appelbaum, lead writer on economics and business for the New York Times editorial board. 

He's writing about the 23 Republican governors who are cutting off the $300-a-week federal boost to unemployment benefits which was part of the recovery package passed by Congress. This mean spirited crew insists we must starve poor people back into taking low paying jobs, typical Republican policy.

... A lot of people are going to get hurt, and the pain will not be distributed randomly.

States administer unemployment benefits because racist Southern senators in the 1930s and the 1940s prevented the creation of a federal system. Almost a century later, Southern states still operate the stingiest unemployment programs. In recent years, for example, unemployed workers in New Jersey have been roughly five times as likely to qualify for jobless benefits as those in North Carolina. The benefits in New Jersey are larger and last longer, too. 

The legacy of the racism that infected so many of the New Deal’s achievements is particularly bitter for Black workers, who continue to live disproportionately in the states that provide the least aid to those who lose their jobs. During the last recession, only 23.8 percent of unemployed Black workers received benefits, compared to 33.2 percent of white workers, according to a 2012 analysis by the Urban Institute. Those who qualify for benefits also get less money. On average, the 11 former Confederate states replace just 40 percent of lost wages, compared to an average of 46 percent in the rest of the United States. 

The supplemental federal payments have temporarily lifted all boats, raising the average weekly payment in the stingiest state, Mississippi, above the pre-crisis average payment in the most generous state, Hawaii. But in the coming weeks, as blue states continue to accept federal funds while red states stop, the gap will yawn wider than ever. 

Although Americans generally agree that government should not act with racist intent, the unemployment safety net was designed with racist intent. And it continues to work in the way that it was designed, allowing Mississippi to badly serve Americans who live there. ...

This comes from the NY Times lead business writer, not some Occupy critic. Awareness of racial impact has moved to the center -- and the GOP is desperate to cancel it ... as well as to silence  the people who need the $300-a-week ...

• • •

Here's what these bigoted unemployment policies mean for the economy at large, also from the Times.

The chronic problem we face as we put Covid-19 in the rearview mirror is that the U.S. economy before the pandemic was incredibly dependent on an abundance of low-wage, low-hours jobs. It was a combo that yielded low prices for comfortably middle-class and wealthier customers and low labor costs for bosses, but spectacularly low incomes for tens of millions of others. This dynamic was first brought into stark relief by the discourse about “essential workers” during the worst of the pandemic. Now it will be highlighted by the frustrating, unequal outcomes of this Great Reopening.

If, in this summer interim, the remaining federal benefits for those without jobs pressures some employers to increase wages and offer a more full-time hours to their employees, then that is all to the good for them and the sturdiness of our economy. The good news for workers is that wages tend to be “sticky” and hard to reverse. ...

 If Congress won't vote the $15 minimum wage, workers of all races will force it themselves, insofar as they are able.