Welcome friends!
I wish you all a healthy and happy Thanksgiving! I know if you’re a liberal like me you may be struggling with the holidays this year given our particularly ominous political and economic situation; however, to quote my favorite fictional gay headmaster Professor Dumbledore, “Happiness can be found in the darkest of times, if one only remembers to turn on the light.” With that sage advice in mind I determined to find among the huge risks and setbacks we now face with respect to the environment, our national security, the economy, the national debt, human rights, education, free speech, democracy, and so many other aspects of life something positive to say about the movement that brought us the clown president. And you know after a few glasses of some perfectly acceptable wine I think I might have found something. We may be nearing the time when people other than us liberals will be willing to talk openly and honestly about distributional issues. Why do I think that? Because by all accounts distributional issues may have played a large role in this last election. Indeed, I was reading an article in the New York Times that mentioned twenty-six of the thirty lowest income states voted clown. Talk about your trends. Of course I’m sure income is probably correlated with some other potentially relevant characteristics like education but anyway there’s at least some prima facie evidence distributional matters may have played a role. Some people may have finally figured out they’re missing out and may have finally decided to do something about it. It’s unfortunate what they’ve decided to do about it is so opaque, unlikely to succeed, and bundled with so much conservative garbage but at least perhaps we can now acknowledge the distributional elephant in the room.
Yes, I find it more than a little ironic the American working class has apparently chosen finally to start looking after its interests by going with President-elect Clown and the other conservative one percenters given the traditional conservative line, the line that led many people to accept without question the desirability of free trade and the free movement of labor and so on in the first place, is that we needn’t worry about distributional issues because everything is handled adequately by the free market and any interference with that miraculous clockwork mechanism will doom us all to penury. As I’ve always been careful to point out the free market is indeed good for many things in many circumstances. However, as liberals and critics of neoclassical economic orthodoxy have argued for years free markets don’t necessarily always work as planned depending on the characteristics of the particular markets under consideration and equally or more significantly they don’t necessarily do a good job addressing distributional issues. That is to say, they don’t necessarily deliver money and jobs to people we may think need money and jobs such as for example our compatriots in lower income states who ended up voting clown. So I think we can all agree it’s good we’ve moved beyond the sort of simple minded conservatism we’ve been accustomed to these past several decades. Seems other people may have decided distributional issues matter after all. The free market is not the answer to everything that ails us.
Unfortunately the policies this new generation of conservatives apparently intend or profess to intend to use to address these distributional issues raise quite a few issues of their own. For example, one solution they’ve been throwing around is trade restrictions. Now in case economics and history are not your strong points I should point out that although trade restrictions are sometimes helpful for some firms and some workers in the short run from a distributional perspective they typically don’t work very well in the long run because other countries tend to enact their own trade restrictions in retaliation and the next thing you know we’re all making a whole lot less of whatever it was for a lot higher price than we were formerly. It’s one way of addressing distributional issues relating to firms and workers in some industries otherwise at risk of losing out to international competition but it comes with some pretty significant risks as well. I’d be a lot more satisfied to give it a try if we had all sat down and discussed it rationally and sensibly and decided it was the best way to address this issue but it’s hard to avoid the suspicion conservatives have hit on this approach not out of reasoned consideration but because they want to address distributional issues in a way that doesn’t make government influence in resolving the issues too obvious because in the eyes of traditional conservatives that would amount to socialism. If government acts behinds the scenes (relatively speaking) to rig markets to give more acceptable results I suspect conservatives feel they can better maintain the pretense government is always bad and unnecessary and markets always good and efficient and so on. Given the conservative elite’s flair for simple minded rhetoric and the conservative base’s flair for going along with whatever the economic elite feels inclined to feed them it will be incumbent upon us liberals to clarify what’s going on here. We had a free market in the form of international free trade and some people basically tanked so we’re now rigging the market to make it turn out better for them in the short run. It’s basically a form of redistribution because although some of us may be better off at least in the short run the rest of us will be paying the cost in terms of higher product prices. Now if we can finally drop the need to accommodate traditional conservative market worshipping let’s think if there are other more sensible ways to get that same distributional result that don’t involve some of the costs and risks of trade restrictions.
The story relating to the free movement of labor is similar. Again this is something that has long been lauded by traditional conservatives. According to traditional conservative free market ideology if we bring the workers of the world into one vast free market for labor we’ll all be better off. Worrying about the economic well-being of one’s fellow workers in one’s own particular country is a form of socialism. It’s the same theory that underlies the traditional conservative antipathy to unions. Unions are bad because they interfere with the free market for labor. But it seems the new breed of conservative is willing to acknowledge a free market for labor in the international context can have unfortunate distributive effects on workers in formerly high income nations. Hard to imagine such workers having much bargaining power if they’re competing with an army of unemployed poor people from other countries. (Or if one is a conservative and has trouble perceiving the role of bargaining power in resolving distributional issues let’s just say it’s hard to image many workers landing good jobs at reasonable wages under those conditions.) This is presumably where all this wall business fits in. Again, I get the idea but I’m not sure demonizing and deporting undocumented immigrants and building a wall are really the best policies to address it. And again I’m not sure this solution is the result of a rational discussion or just what happens when one tries to solve a problem without really talking about it directly. You know what I mean. We’re not talking about restricting the free movement of labor or the value of free markets in general. We’re just talking about ejecting some bad hombres. Anything else is just a side effect. Wink wink.
The other approach I’ve been hearing about involves rebuilding some of our national infrastructure, which is actually something we badly need and that could also help out on the distributional front by putting some people to work doing something useful who might be unemployed or underemployed if we leave the market to its own devices. This is a long standing liberal priority that brings to mind nothing so much as the successful policies of the New Deal in the 1930s that did so much to ameliorate the impact of the Great Depression. But again even here I seem to detect some peculiarities. Instead of doing something simple and sensible such as using tax revenues to pay people to rebuild infrastructure we’re apparently talking about some complicated program designed to change the incentives for other people to do it or something like that. Again I wouldn’t be as concerned if I thought we had sat down and discussed it and decided this approach works best but I can’t help but wonder if the reason they’ve hit on this approach has more to do with ideological blinders and image than with economics. How we can use government to fix a problem but maintain the fiction we don’t need government and market forces are doing it all? Have government do something behind the scenes to change market incentives and then laud private business for responding to those incentives. Is that honestly the best and cheapest way to get this done or are we basically footing the bill for conservatives to preserve their ideology?
Finally it’s unfortunate the new breed of conservative has managed to combine important elements of the liberal agenda like addressing some of the distributional issues associated with free markets and paying attention to public goods including rebuilding infrastructure with traditional conservative concerns like disregard for the environment; oppression of minorities be they racial, religious, or sexual; union busting; bellicose militarism; and the endorsement of policies designed to enhance the wealth and power of the economic elite (for example weakening the progressive income tax, reducing the social safety net, eliminating the estate tax, etc.) Equally unfortunate is that the man they’ve chosen to implement these ideas is so unattractive and disreputable along so many dimensions and being one of the one-percenters who has prospered under our current arrangements has such strong incentives to not rock the boat or at least to be very careful how he rocks it. Even if one accepts the possibility the clown administration may actually attempt to address some of these long-standing liberal concerns in its own twisted way it seems quite possible to me what it gives with one hand it may take back with the other. Hard to see how it will all play out in the end. Will the situation of struggling American workers actually improve or will the only people whose situation improves in the long run turn out to be President-elect Trump and certain other members of the ruling class? Were workers played for chumps by rich people eager to gain political power to purse their conservative social agenda and further their own economic interests or do some member of the economic elite honestly have the best interests of struggling American workers in mind? I suppose only time will tell. But at least some issues are on the table now that formerly were not. That must be a sort of progress don’t you think? We can all be thankful for that.
References
A Jolt of Blue-Collar Hope. David Leonhardt. The New York Times. November 22, 2016. http://www.nytimes.com/2016/11/22/opinion/a-jolt-of-blue-collar-hope.html?action=click&pgtype=Homepage&clickSource=story-heading&module=opinion-c-col-left-region®ion=opinion-c-col-left-region&WT.nav=opinion-c-col-left-region.
