On TAP: Kuttner + Meyerson

Meyerson

They keep coming, these papers by economists, chock full of equations I can’t decipher and an economists’ jargon I have to translate into English, but all of which conclude what has been obvious for some time: A massive redistribution of wealth from labor to capital has been ongoing for decades.

That’s not to denigrate these surveys; it matters that the clear statistical evidence is backed up by clear statistical analysis. The latest such analysis comes from three professors: Daniel Greenwald at MIT’s Sloan School of Business, Martin Lettau at Berkeley, and Sydney Ludvigson at NYU. The subject of their investigation is, in Piketty patois, how r (the rate of return on investment, in this case, share values) has grown faster than g (the overall growth of the economy) in the United States since 1988. What the Gang of Three concludes is that “from 1952 to 1988, economic growth accounted for 92 percent of the rise in equity values, “but that from 1989 to 2017, economic growth was responsible for just 24 percent of the rise in the value of stocks. What made stocks rise in recent decades was “reallocated rents to shareholders and away from labor compensation,” which accounted for 54 percent of the rise in share values. That is, the share of income going to corporate shareholders increased because the share of income to corporate employees decreased.

As I said, economists have been discreetly sharing this message for some time now. In July 2011, a report JPMorgan Chase distributed to its large investors concluded that 75 percent of the increase in American corporations’ profit margins in this century was due to “reductions in wages and benefits.”  

This isn’t to validate Proudhon’s famous charge that “property is theft.” Then again, it doesn’t invalidate it, either. 

Kuttner

I have long argued that neglect by Democratic presidents of the long slide of America’s working families paved the way for Trumpism. The rules and rewards were increasingly tilted to elites. Legitimate economic grievances were then racialized, by Bannon, Trump and company, and the stench of racism lingers. 

Now democracy itself is at stake. So Democrats must not just win in 2020, but win as economic progressives, with a broad appeal that can bridge rather than inflame divisions of race and identity. The common foe is not other working people of different races—it’s Wall Street heisting all the economy’s gains.

That’s why the line we often hear—I’ll vote for anyone who can beat Trump—doesn’t make sense. A progressive appeal and a progressive candidate are needed, both to beat Trump and to reclaim America. More corporate centrism won’t accomplish either.

I’ve put this case into a short book titled, The Stakes: 2020 and the Survival of American DemocracyIt’s being published on Labor Day.

Surprisingly, it’s an optimistic book. Democracy is battered, but as the 2018 midterms showed, we can still win elections when progressives are mobilized. 

Trump is not quite self-destructing, but he keeps narrowing his appeal to only the haters; and thankfully the haters are nowhere near a majority. And we actually have progressive candidates who connect a radical program to a human narrative, and they are being heard above the noise.

We’re having several book events, to which you are cordially invited, beginning with the D.C. bookstore Politics and Prose at the Wharf, 7:00 p.m. on September 3. It’s a free event with no RSVP needed. Others will be held in New York, Boston, Chicago, Madison, and elsewhere. I’ll keep you posted.

Kuttner

I spent some time last week with Alex Morse, the 30-year-old mayor of Holyoke, Massachusetts, who has just announced his primary challenge to Ways and Means Chair Richie Neal, 70, the most corporate of congressional Democrats. 

Neal’s constituents in western Massachusetts are rather more liberal than he is. Morse has gained national attention for running his own home-grown Green New Deal in the depressed factory town that he has governed since first winning the election at age 22.

This will be one of at least a dozen such challenges in 2020 that stand a decent chance of succeeding. Justice Democrats, the group that recruited AOC, has already announced endorsements of six challengers to incumbent Democratic members of the House.  

Some of this is salutary. But if a hundred insurgents and incumbents are competing to raise money, organizer volunteers, and take down each other, Democrat against Democrat, in the most important election year of our lifetimes, that’s not so good.

One other useful bit of collateral damage is that these races could force the House Democrats’ fundraising arm, the Democratic Congressional Campaign Committee (DCCC) to mend its ways. The DCCC has been notorious for backing corporate Democrats over progressives.

I did a deep dive into all of this. Here’s my full story.

Meyerson

In my Tuesday On Tap, I noted that a number of Walmart employees, in the wake of the mass murder at an El Paso mega-store, had begun expressing concern about the company’s policy of selling guns (Walmart is the nation’s leading gun retailer) and allowing open carry in stores in the states that permit it. 

That discontent is now ballooning. 

In Walmart’s Silicon Valley e-commerce office, 40 white-collar employees walked off the job yesterday to urge their employer to stop selling guns. Actions were also held at e-commerce offices in Portland, Oregon, and Brooklyn, and organizers also initiated a Change.org petition calling on Walmart to cease selling firearms. By Wednesday night, 38,000 people had signed it.

Ever eager to stomp on any workers voicing discontent, Walmart suspended the email and Slack accounts of the two Silicon Valley employees who initiated the action, but then thought better of it and reinstated those accounts. Perhaps Bentonville calculated that it had to deal with its tech workers a bit less brutally than it customarily does with its blue- and pink-collar employees. 

The Walmart rising comes on the heels of mass employee walkouts at Google, Amazon, and other tech giants over such issues as the sale of facial recognition technology to China and the failure to clamp down on sexual harassment. Considered alongside the strike wave of teachers and hotel workers that began last year, we’re clearly entering the Era of Worker Walkouts, most of which pose demands about the employees’ own situations but also about the greater social good. Our dysfunctional labor law makes it nearly impossible for non-union workers to gain a legally recognized collective voice, but that doesn’t seem to be deterring actual American workers, who for all manner of good reasons are plain fed up.

Kuttner

Trump’s latest impulsive moves against China, which reflect no coherent trade strategy other than his own petulance, could well derail the strongest thing he has going into the 2020 election: a relatively strong economy.

The New York Times’ Paul Krugman has calculated that the costs of a trade war with China could equal or exceed the fiscal benefits of the tax cuts and lower interest rates combined. The stock market has been oscillating widely in anticipation of a weakened economy.

Something had to change in U.S. passive acceptance of China’s predatory economic model. But as I’ve previously written, that course would have taken subtle diplomacy and patience, neither of which are Trump’s strong suits. 

Some U.S. manufacturers are now looking past China in their supply chains. That shift will probably benefit other Asian nations such as Vietnam more than it benefits the U.S. 

China, for its part, rapidly becoming the global leader in a broad range of industries and technologies, is already looking beyond the U.S., which under Trump is fast squandering the leverage we have. China's willingness to reduce the value of its currency, daring the U.S. to retaliate, is only the latest evidence that Trump's bravado is backfiring.

At the rate things are going, Trump is squandering one election year advantage after another. What remains is his brew of racism, violence, and hatred. It won’t be enough.

Meyerson

In the wake of the assault-weapon murders at El Paso’s mega Walmart, America’s number-one gun seller and largest private-sector employer has come under justifiable criticism for its gun policies. Roughly half of Walmart’s 4,750 stores sell guns, and the company announced on Monday that that policy would not change. It also announced that it wouldn’t adopt a no-open-carry policy for its stores, which means that anyone in a state that permits the open carry of firearms—like Texas—can sashay through a Walmart brandishing a gun.

Not surprisingly, some Walmart employees have voiced apprehensions about that policy in the aftermath of Monday’s mass murders. “I’m looking around the store, thinking, where can I hide if something happens,” a customer-service employee at a Los Angeles-area Walmart told The Washington Post. “We’re all afraid we’re going to die.”

Getting their employer to prohibit open carry in its stores would be just the sort of proposal Walmart workers could present to their bosses if they had a union. But Walmart’s position on unions was made clear when the butchers in one Texas store endeavored to form a union some years back. The company responded by shuttering its meat department in that store, in every store in Texas, and in every store in the states surrounding Texas. 

The grievances that lead workers to seek a union have never been only economic; sometimes, they’re about their concern for life and limb. Such would likely be the case at Walmart today if our labor law actually allowed workers to organize. A timely reminder that American business’s rabid opposition to worker power not only has given us four decades of wage stagnation but that sometimes, it kills.

Meyerson

The mass murderer of El Paso, shortly before he started shooting, posted that he was seeking to repel “the Hispanic invasion of Texas.” In this, consciously or merely zeitgeist-ly, he was echoing our president, who’d previously spoken of the “invasion” of the United States by Hispanics at the border.

It’s clear (and not surprising) that the murderer and the president lack even a rudimentary knowledge of American and Texan history. Hispanics settled Texas long before the Anglos came. As to the state’s other racial minorities, African Americans initially came to Texas not as invaders but as slaves. And the real Asian American surge began in the wake of the Vietnam War, when a number of the South Vietnamese fleeing communism relocated to the state.

So which ethnic group can fairly be described as the Lone Star State’s invaders? Well—white folks. By the Trumpian criterion of repelling invaders, they’d be first on the list of potential deportees. Prudently honing that list to Texas whites who pose a threat to public safety, we could winnow it down to white Republicans, who resolutely refuse to ban the sale of assault weapons and demonize the ethnic groups who got to Texas first. 

Just sayin’. 

Kuttner

As you sow, so shall you reap. The manifesto posted online in advance of the El Paso Walmart slaughter leaves little doubt that the killer, who lifted language from Trump tweets, was energized by the climate of white supremacist and anti-immigrant hatred stoked by the rantings of the Hater-in-Chief. As were so many other haters.

Trump was way off his game in his effort to say something comforting or remotely plausible about the latest shootings. In his initial a pair of tweets, he tried to connect the shootings to “desperately needed immigration reform,” and once again sought to scapegoat the media, contending that coverage has “contributed greatly to the anger and rage.” And in his scripted speech to the nation this morning, he kept invoking God, calling for “great” legislation, and declaring that we must assure that the murdered “shall not have died in vain.”

While there are plenty of haters out there, they are far from a majority of the electorate. Trump’s responsibility for the wave of mayhem and his response to mass murder offends many Americans otherwise tempted to vote for him. 

There is far too much defeatism on the Democratic side about the likelihood of Trump’s re-election. Most Americans are disgusted by the wave of grotesque hatred that Trump has engendered. The economy is beginning to turn against Trump as well.

This week also saw the beginning of a Republican backlash against climate change denial as well as more House Republicans deciding to call it quits. 

From Charlottesville to Parkland to Pittsburgh to El Paso to Dayton, there are too many innocent souls who did not volunteer to be martyrs to Trump. There is only one way for them not to have died in vain. It is to rid this nation of the pestilence that is Donald Trump.

 

Meyerson

Today’s pop quiz: In the election of 1860, how many popular votes did Abraham Lincoln receive in the Southern states?

Answer: None. The Southern states refused to allow Lincoln’s name, or that of any Republican, to appear on their ballots.

I was reminded of good old Dixie’s commitment to democracy earlier this week, when California Governor Gavin Newsom signed into law a bill that required presidential candidates to release their tax returns as a condition of getting their name placed on the state’s November 2020 ballot. The new law is clearly intended either to force Donald Trump to comply, or to forego having his name put before Golden State voters.

I fear, though, that California Democrats have made an elemental and deeply stupid mistake—forgetting that law of motion stipulating that every action has an equal but opposite reaction. The California statute may just prompt Republican-controlled states to require every presidential nominee to, say, support the ongoing criminalization of undocumented border crossings, or call for the repeal of Roe v. Wade, to get their name on the states’ ballots. If the Democratic nominee’s name were not put before voters in Alabama, it wouldn’t really matter, since Alabama is bound to go for Trump. Then again, California is just as bound to go for the Democrat, no matter who it be.

But what about Republican-controlled swing states like Georgia and Florida—or, for that matter, Arizona and Texas? Should the courts rule that states have the legal right to engage in ballot-bouncing, the Democratic nominee may be bounced to far greater, and more disastrous effect, than Trump. I’m not predicting courts will rule that way, but why take a chance that just might ensure Trump’s re-election and the ensuing end of civilization as we know it. 

Kuttner

Please excuse this rant. Today’s offender is, once again, the best of the mainstream media, The New York Times. Two items, actually.

Exhibit A: Front page, Sunday piece on Kamala Harris. Print Headline: “Pragmatism, not Ideology, Defines Harris.”  

OK, for starters, this is a completely false framing. There is no such thing as a politician without an ideology, though there are plenty of politicians who try to duck or fudge where they stand. 

The Harris piece takes up more than a page in the Times. Near the bottom, writer Alexander Burns, finally notes that “Harris has proposed no major policies to constrain extreme wealth and corporate power”

Bulletin to the Times: That’s not called pragmatism. It’s called corporate Democrat. Which happens to be an ideology.

It gets worse. In Monday’s Times, another front-page lulu of false framing. This one, by Reid J. Epstein and Lisa Lerer, begins with the promising print headline: “A Clash of Democratic Priorities: Change Presidents or Change the Paradigm.”  

The piece includes this hum-dinger of a sentence right in what journalists call the “nut-graf,” the paragraph that signals the reader what the piece is about. I quote: “Is beating Trump enough? Or should Democrats, much like the man they hope to defeat, shake the political system like a snow globe and worry later about how things settle?”

Say what? There is so much wrong with that framing that you could build an entire journalism course around it. 

For starters, Democrats who want to alter the system are not proposing to shake it “like a snow globe.” They are proposing fundamental changes in the rules of the political economy that keep screwing regular people and leading to frustrations that elect people like Trump.

Nor do they propose to “worry later about how things settle.” On the contrary, changing the system’s rules to create specific, concrete and durable change is the whole point. But this idiotic piece would have the reader believe they are shaking things up for the sake of shaking things up, dropping bombs for the sake of dropping bombs.

Nor of course are Democrats like Elizabeth Warren or Bernie Sanders in any respect whatsoever “much like the man they hope to defeat.”

Jesus wept! Does the Times have editors? Are they as clueless as some of their political writers?  

Where do these people get their political educations? And this is the best of the mainstream papers. No wonder our political discourse is so screwed up that Donald Trump can pose as a populist.

[Commercial: Go, Prospect!]

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