A Trump Vision? Back to 1925?

After the American Century

If one looks at Mr. Trump's pronouncements and puts them together, the overall goal seems to be a return to the America of 1925, with only a few pieces of the New Deal remaining domestically. In foreign affairs, the US would not rely much on NATO or other alliances, but rather would make bilateral arrangements with other nations when it seemed of benefit.

In the United States of 1925, abortion was illegal, race relations were hierarchical (with whites dominant, of course), and the welfare state was quite modest. The Federal government had an adversarial relationship to most cities, because Prohibition was laxly enforced there, and the strongest supporters of the Republican presidents of that era came from rural and small town America. Trump has already developed an adversarial role with many cities, over illegal immigration.

During the 1920s immigration was severely restricted, and with a strong preference given to northern Europeans, and very small quotas to non-whites. Immigration was easier from Mexico and Canada then, but Trump is intent on closing these loopholes, and putting the US behind an exclusionary wall.

In the 1920s there were also large tariffs on imports, and Americans produced most of what they consumed.

It would seem that the Trump Administration wants the United States to return to this era, perhaps without the jazz music of the "Roaring Twenties," but with the soaring stock market. Last week, for the first time, ever, the Dow Jones Industrial Average rose about 20,000.

The rest of the world has changed just  a bit since 1925, however, and it might be hard to re-create that era.

America First? Trump's slogan has a sorry history.

After the American Century

In his inaugural speech, Donald Trump made a point of saying that his administration would put America first.  This is in striking contrast to many previous presidents. John Kennedy said the US would "bear any burden, pay any price" to defend freedom and democracy in the world. Trump said:

"From this moment on, it's going to be America First. Every decision on trade, on taxes, on immigration, on foreign affairs, will be made to benefit American workers and American families. We must protect our borders from the ravages of other countries making our products, stealing our companies, and destroying our jobs. Protection will lead to great prosperity and strength."

The America First Movement was prominent in the early years of World War II. It advocated that the US remain neutral in the conflict, and had many supporters until Pearl Harbor. The slogan "America First" was used at the 2016 Republican Convention, and at the time National Public Radio and other journalists noted the unfortunate history of this slogan.

Nevertheless, Trump repeated this phrase emphatically in his speech. It suggests a return to isolationism and mere self-interest in foreign affairs. There is nothing idealistic in such a phrase. Nor is this the first time he has said it. Back in March, during the Republican primaries, he also said he advocated "American First," and he did so again in what was billed as a major foreign policy address in April, covered by CNN. The phrase has often been associated with a lack of sympathy for or understanding of the plight of Jewish people and other minorities in Hitler's Germany. 

At best, it is unfortunate that Trump persists in using this expression. Republicans have often used coded language to appeal to special interest groups. Reagan did this in his time as president, encouraging religious conservatives through veiled references to the Bible, and now it appears that Trump is doing the same thing. The extreme right wing certainly knows about the "America First" movement.  Trump was slow to distance himself from extreme right wing groups, and he has made a right-wing ideologue, Steve Bannon, his close advisor in the White House. 

The mainstream media seem intent on normalizing Trump. Today they are emphasizing the peaceful change in power, and trying to suggest that the change is just part of the ebb and flow of American democracy. But the slogan "America First" hints at something else, something less savory. It suggests a fundamental reorientation toward self-centered isolationism. This would be consistent with Trump's repeated statement that he thinks NATO is obsolete, his refusal to accept the reality of global warming, and his attacks on free trade. 

It is only day one, but there are many reasons to worry. Keep watch.

Political Confusion and Tension, but No Voter Mandate in Sight for either Republicans or Democrats

After the American Century

Today's politicians seem to live in a hall of mirrors, because they are surrounded by like-minded people. Clinton and Trump both appear to have had that problem, though it was manifested in different ways. They each thought they understood the public mood, and each looked in the mirror and thought they were more than they were. Hillary now knows this, but Trump does not, or rather, not yet.

Admittedly, the political scene is complicated, and it is hard to sort the trends out into a meaningful pattern. In the US the country as a whole seems to be moving to the right, yet Hillary Clinton had more than 2 million more votes than Donald Trump. The gun lobby prevents any meaningful control over firearms, but at the same time more than half the public wants some form of gun control. Same sex marriage has become legal, but opposition to it remains strong. Whatever trend one points to, there seems to be a powerful trend in a different direction.

The result appears to be that every citizen holds one or two positions that the government opposes, and all too many people have no understanding or sympathy for those who do not share their position. Compromise or the attitude that one should "live and let live" both seem rare. 

President Obama worked against this atmosphere of division and tension, without much success. Donald Trump seems intent on fostering more division, upsetting the public even more than they already are. He has appointed someone who denies climate change to head the Environmental Protection Agency.  He has appointed a person who wants to abandon public education for the voucher system in charge of education. He has chosen an Exxon oil executive to oversee foreign policy, and he will deal with major oil producing countries where Exxon has interests, including Russia and the Middle East. Trump has repeatedly praised Vladimir Putin, even as it has become quite clear that Russia has mounted widespread cyber attacks on the US and its allies. 

The only consistency here is that Mr. Trump avoids moderation. His rhetoric and actions repeatedly go to extremes. He sees himself as an enormous figure in that distorting mirror. But the American public is deeply divided by him. I do not recall large rallies being staged against any other president on Inauguration Day. Usually the event is a celebration of the peaceful transition of power, where the new President lays out a broad program and seeks to win the confidence of a broader public than those who elected him.

Such a speech, such an appeal, is especially needed in 2017, after a nasty political campaign that discouraged voter turnout and led to the election of a candidate who did not win a majority of the votes cast. But Trump seems to think he has a mandate. He does not. He received 46.1% of the votes cast, to Hillary's 48.2%. Only 129 million people voted, and the turnout was the lowest in 20 years. To put this in perspective, here were the real results of the election

No one   42%  (i.e. did not vote)

Clinton   30

Trump    28

In other words, Trump came in third, and Clinton only did slightly better. The voters did not much like either candidate. Rather than trade accusations about leaked emails, it is time for both political parties to admit that the public did not like these candidates. There is no mandate for Trump, and if Hillary had won, there would not be one for her, either. Acting as if one has a mandate did not work out well for George Bush, nor is it likely to be a success for Donald Trump. The distorting mirror can only seem real for a while.

Can Tillerson still be Secretary of State after Trading with the Enemy?

After the American Century

The Newsletter 538 noted the following about an article that appeared in USA Today.

"Between 2003 and 2005, the oil and gas company Infineum reported $53.2 million in sales to Iran. During that time, Exxon Mobil had a 50 percent stake in Infineum. Also during that time, the U.S. had sanctions on Iran as a state sponsor of terrorism. Rex Tillerson, a top Exxon executive at the time of the deal and later its CEO, is now President-elect Donald Trump’s nominee to run the State Department."

So the nominee for Secretary of State broke the US sanction on Iran during George Bush's presidency. (Exxon Mobile also did business with Sudan through the same proxy company, but it was a much smaller transaction.) Iran was then well-known to sponsor terrorist and dissident groups in various parts of the Middle East, hence the sanctions, so there it is not possible for Tillerson to claim he didn't know. 

After this revelation, here are the problems with making Rex Tillerson Secretary of State:

1. He has broken the law in order to make a profit. The claim made in defense is that Infineum is based in Europe, and that no Americans were employed in making these transactions. To avoid violating US law, under this Secretary of State it would seem, it is just fine so long as you do it through a proxy. 
2. He has taken sides in the Middle East, trading with Iran during the time of sanctions.
3. He will not be trusted by an important American ally, Israel, which fears the Iranian atomic program.
4. He will not be trusted by Saudi Arabia, a second important ally, who is constantly in conflict with Iran over a great many issues.
5. He will be regarded with suspicion by a third ally, Turkey.
6. The worst suspicions of US critics, that its foreign policy is concerned not with principles but profits, specfically oil profits, will be confirmed.

That is rather a large amount of baggage to be carrying into confirmation hearings. Can his fellow Republicans stomach all that?

It seems the Republicans cannot stay away from making deals with the Iranians. That was their problem during the Reagan years, too. The original Irangate was also about trading with the enemy.  Is that the credential needed to be Trump's Secretary of State?

5 murders annually go unsolved in Denmark, compared to 25 in Minnesota

After the American Century

One interesting way to compare nations is in terms of their rates of criminality and to what degree these crimes are solved. The US and Denmark are a study in contrasts when it comes to the homicide rate. In Denmark, between 2007 and 2015, there was an average of 49 murders each year, and 90% of these were solved. 51% of the killers were either partners or family members. 26% were killed by someone they knew slightly, and 11% by a friend. Only 8% died at the hands of a person unknown.

To put these statistics in perspective, consider an American state of similar size. Denmark has a population of 5.7 million, slightly more than the 5.5. million in Minnesota, which was settled in part by Scandinavians in the late nineteenth and early twentieth centuries.  The Minnesota annual murder rate during the same time period was twice as high, just over 100. Looking at 2011, a good year with less than 90 homicides, 66% of the victims knew the murderer, while in just 6 cases the killer was a stranger. These percentages are similar to Denmark. However, in one quarter of the Minnesota cases the relationship of killer and victim remains unknown. Minnesota has twice as many murders as Denmark, and about a quarter of the murderers are not caught.   Put another way, 5 murders annually go unsolved in Denmark, compared to 25 in Minnesota.

What might one conclude from this comparison? Denmark may well have half the number of murders in part because the chance of being caught is significantly higher. But the matter is more complicated than that, because Denmark also has strict gun laws. One cannot carry a pistol, and all rifles must be registered with the authorities. There are far fewer guns ready to hand when a couple or a family gets into a nasty argument. The murder rate in Minnesota might well drop a bit if guns were not so easy to come by, and it probably would rise if Danish families had as many guns.  For in both places most of the murders are committed by close friends or family. 

But this only suggests a possible explanation for the higher murder rate, not for the considerably worse police results. Again, this is a complex matter, but it seems that detectives benefit greatly from information provided by the general public. The more crime there is in a community, the more likely witnesses may feel intimidated and remain silent. Such intimidation surely occurs in both Denmark and Minnesota, but where is it likely to be more common? A place where 25 murderers are not caught every year, or one where only 5 escape detection?

Of course, Minnesota is not representative of the entire United States. According to Federal records, it is among the five states with the lowest homicide rate, along with New Hampshire, North Dakota, Vermont and Massachusetts. Climate is surely not the explanation for why these five are all in the North, but it is interesting to note that the states with the highest murder rate are in the South. Louisiana and Mississippi have ten murders for every one in Minnesota. Indeed, all by itself Louisiana had more than 500 murders in 2014, more than the combined total for the states with the fewest homicides.

Statistics from

Minnesota

http://www.disastercenter.com/crime/mncrime.htm

https://dps.mn.gov/divisions/bca/bca-divisions/mnjis/Documents/2011%20State%20Crime%20Book.pdf

Denmark

https://www.dst.dk/en/Statistik/emner/befolkning-og-befolkningsfremskrivning

http://www.dkr.dk/drab

"Dimensioning" a Danish word for cutbacks at universities

After the American Century

Austerity has taken a new form in Denmark, where the Socialist government has betrayed its campaign platform. When running for election, it promised to support education, because Denmark's future lay in having a highly educated population. The worst thing in the future, they said, would be to be a worker without skills. But after four years in power, the government has failed to create jobs. Fewer people are working today than when they came into power.

To "explain" this failure the government has blamed the universities for training too many people! Never mind that in 2008, when today's new graduates began their studies, economists assured the government that soon there would not be enough workers to fill the jobs. Never mind that unemployment today is considerably lower than it was when the last socialist government was in office during most of the 1990s. The whole problem, obviously!, is that the universities trained people in the Humanities, rather than in Engineering and Science and Law. 

Solution! Cut 3,500 places out of admissions to the Humanities, every year. Some of these people might choose to study law or economics. Perhaps a few will have aptitude for physics or chemistry or engineering. Very few of them will have the grades or the prerequisites to enter medical school. In all, perhaps 500, certainly no more than 1000, will take some non-humanities course of study, if they can get in, of course. Many of these students will drop out, however. After this policy has been in place for ten years,  at best 5,000 people will have degrees in fields they did not want to study, while there may well be 30,000 young people with no advanced education!  To put this in perspective, in 2014 about 70,000 people receive unemployment benefits in Denmark.  Under this government plan, as many as 30,000 people may go directly to the unemployment line right after gymnasium. [Update: in 2017 alone, more than 20,000 people were denied admission to higher education, and the cutbacks continue.]

Look past the rhetorical nonsense, and this plan is simply a foolish cutback. Danish education is entirely tax supported, but the Danish unemployed get 2 full years of support. So the government's idea is that they would rather pay 30,000 people to be unemployed than spend roughly the same amount to give them an education. 

And even if this really were a savings program, Denmark is not exactly a poor nation. In 2014 it will have one of the smallest deficits and one of the lowest unemployment rates of any EU country.   

The Failed Economics of Austerity in Europe, and its consequences in Denmark.

After the American Century

The way governments responded to the financial crisis of 2008 differed. In Europe, they pursued austerity. They held down deficit spending and cut government jobs. In the US this response was common at the state level, but the Federal Government pursued a different policy. It loaned money to the faltering automobile industry, which has now recovered. It sped up spending on infrastructure, and was not afraid to stimulate the economy. 

Now we can see the results. The US economy has recovered considerably, with unemployment falling almost continuously during the last five years. The economy has grown every year since 2009 when Obama took office.

Contrast almost any country in Europe, where economies are barely holding even or shrinking. The headlines years ago focused on Greece, Italy, Spain, Portugal and Ireland.  But now the austerity policy has begun to hurt the larger, stronger economies. Germany is struggling to keep growing. France is in recession. This is now much in the news.

But Denmark is also having economic problems. Its economy has essentially stopped growing, and even shrank during some recent quarters. According to the World Bank, the Danish economy shrank in 2009 by -5.7 %. Five years later it has not gotten back to where it was before the crisis. With growth of -0.4% in 2012 and + 0.4% in 2013, the Danish economy is flat. This failure of economic policy ought to be the focus of attention. 

But the ruling Danish politicians have mounted a massive campaign of distraction. They have managed to convince many journalists and much of the public that unemployment is high and that this is the fault of the universities. Both statements are false. The Danish unemployment rate is historically lower than for most of the last twenty-five years (see chart below.) 

The idea that the universities are somehow responsible for this non-existent unemployment problem is nonsense. The real problem is that the economy as a whole is stagnant and that few new jobs are being created. Moreover, the age of retirement is rising, so that replacement of the old by the young has slowed down. But no politician wants to admit that the economy is stalled. 

Instead, the "solution," the Ministry of Research claims, is to eliminate thousands of admissions to universities, especially in the humanities. But this is all nonsense. The number of unemployed in Denmark was much higher between 1990 and 2005 than between 2010 and the present.

Historically speaking, the number of unemployed is low, if one's point of comparison is any time except 2006-2008. The real problem is that the percentage of people working is falling, both because the economy is weak and because the population is aging.  Starting in 2009, the percentage of the total population that is working has fallen from 75% to 70%. That is a big drop, and that drop has little or nothing to do with the universities.

More generally, the European-wide crisis that began in 2008 was not caused by universities. Regardless of what students majored in, there just are not as many jobs available as there were in 2009. Eliminating thousands of university admissions in the humanities will not create any jobs, but it will create a cohort of uneducated, unemployed people. If 3,000 fewer people enter the universities every year, after a decade there will be 30,000 more Danes who never attended university. As a result, they will earn less, pay less in taxes, and be more often among the unemployed.

Why is the Danish press unable to see through this government PR campaign? The government's analysis of the problem is wrong, and the "solution" to the problem is wrong. Austerity will make matters worse, creating a stagnant pool of unemployable people.  

The total number of Danish jobs has declined, because the government has pursued an austerity policy. It should have listened to Nobel-winning economist Paul Krugman. He has written about this often, for example in 2012, when he said, "in Europe, as in America, far too many Very Serious People have been taken in by the cult of austerity, by the belief that budget deficits, not mass unemployment, are the clear and present danger, and that deficit reduction will somehow solve a problem brought on by private sector excess." He noted that "research by the International Monetary Fund suggests that spending cuts in deeply depressed economies may actually reduce investor confidence because they accelerate the pace of economic decline."

President Obama's administration listened to such advice, though I should note that Krugman suggested an even higher level of pump-priming than Obama practiced. As a result, the US economy has turned around. In contrast, the Danish politicians obediently marched in lockstep with the Germans, believing against common sense, as well as against the economic analysis of Krugman and others, that if all the European countries reduced spending  their economy would magically improve. 

The Danish government is incompetent in economics, but it is good at creating a distraction, and it has managed to blame the universities for its own mistakes.  As Professor Krugman remarked, with regard to widespread failure of austerity policies to produce the results they had predicted, this is  "a case in which rival theories made different predictions, the predictions of one theory proved completely wrong while those of the other were totally vindicated — but in which adherents of the failed theory, for political and ideological reasons, refuse to accept the facts."

When prophecy fails, a famous psychological study found, its adherents circle the wagons more tightly and re-embrace their mistaken ideas, convinced that someone or something else is responsible for the failure. Today, as Krugman notes, "the prophets of fiscal disaster, no matter how respectable they may seem, are at this point effectively members of a doomsday cult. They are emotionally and professionally committed to the belief that fiscal crisis lurks just around the corner."

The Danish government and its economic advisers are in this situation, and therefore they need to blame someone else for the failure of austerity. And so they blame the universities. The failed logic is that, if only the universities had trained 3,000 more scientists and engineers every year since 2008 rather than humanities students, then these 15,000 people would now be working. But the statistics clearly show that workforce participation has fallen 5% and that there are fewer jobs now than there were five years ago. Even so, the unemployment rate is lower than it has been for most of the  25 years since 1990, because there are more old people and fewer young people. 

Reducing the number getting a university education will not change these facts, but the Danish media seem unable to read statistics, to make elementary calculations, or to read alternative views. Instead of seeing whether there is any logic or statistical basis for the new government policy of austerity for the universities, the Danes have engaged in a heartfelt discussion of the value of the humanities and their place in the development of civilization. An interesting discussion, but it just adds to the confusion artfully created by the government, and it gets in the way of understanding the real situation, which is that the government's German-inspired economic policy has been a fiasco.