Daily Clips: January 25th, 2016

The price Americans pay for slow growth: Here’s a very interesting read on economic growth and its impact upon Americans. As Noah Smith claims,

To increase prosperity for the vast majority of Americans, the U.S. doesn’t just need growth — it needs a way to funnel that growth to the masses instead of just to the people at the top. That may prove to be an even trickier task than boosting growth itself.

Someone has been reading Nick Hanauer’s writing on middle-out economics.

Ta-Nehisi Coates opines about Bernie Sanders: Prepare yourself Bern-ers, you’re most likely going to hate this article, even though Coates does a brilliant job of walking you through his critique. The byline hints at such displeasure, stating, “What is doable and what is morally correct are not always the same things.” Let’s examine what Coates is talking about.

Coates’ previously had written an article which criticized Bernie “for dismissing reparations specifically, and for offering up a series of moderate anti-racist solutions, in general.” He received a lot of flack for this, mostly for not focusing on other candidates that are doing even less to help African Americans. So in his most recent piece, Coates immediately tried to outline why he had solely focused on Bernie (even though he already did a good job of that in his first article).

When a candidate points to high unemployment among black youth, as well as high incarceration rates, and then dubs himself a radical, it seems prudent to ask what radical anti-racist policies that candidate actually embraces. Hillary Clinton has no interest in being labeled radical, left-wing, or even liberal.

Coates goes onto question Bernie’s “rising tide lifts all boats” approach to addressing racism in America:

Across Europe, the kind of robust welfare state Sanders supports—higher minimum wage, single-payer health-care, low-cost higher education—has been embraced. Have these policies vanquished racism?

Perhaps the most powerful paragraph comes here, when he addresses Bernie supporters and their qualms:

The need for so many (although not all) of Sanders’s supporters to deflect the question, to speak of Hillary Clinton instead of directly assessing whether Sanders’s position is consistent, intelligent, and moral hints at something terrible and unsaid. The terribleness is this: To destroy white supremacy we must commit ourselves to the promotion of unpopular policy. To commit ourselves solely to the promotion of popular policy means making peace with white supremacy.

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Daily Clips: January 22nd, 2016

The National Review takes on Trump: Fox News couldn’t take down Trump, Jeb! couldn’t land a punch, so where does the Republican establishment turn at a moment of crisis? A dying magazine! There, a range of conservative thinkers published a series of essays ridiculing Trump. Got ya, Donald!

Seriously, though. Is this the best they’ve got? Is this the “Republican conspiracy” David Brooks was calling for earlier this week? If so, the Republicans are in deep, deep trouble.

Speaking of David Brooks…His latest column is just as insane as the last. Read this paragraph:

In the Palestinian territories, for example, young people don’t organize or work with their government to improve their prospects. They wander into Israel, try to stab a soldier or a pregnant woman and get shot or arrested — every single time. They throw away their lives for a pointless and usually botched moment of terrorism.

I have no idea how someone can honestly make such a vulgar generalization about Palestinian youth. It’s paragraphs like that which reminds me why David Brooks is a Republican after all.

Tweet of the day:

Gif of the day: Sorry Tim Eyman.

View post on imgur.com

 

Joe Biden and Will Smith Speak Economic Truth

1. At the annual Davos conference, in which the wealthiest people in the world gather to discuss, you know, rich-people topics, Vice President Biden delivered a speech that plenty of the people in that room needed to hear. As Reuter’s Ben Hirschler reports:

“My call to action here is simple – embrace your obligation to workers as well as your shareholders,” Biden said, criticizing the recent trend by firms to return mountains of cash to investors by buying back stock rather than investing for the future.

Biden could not be any more right, here. If you want to learn about the roughly trillion-dollar dent that stock buybacks leave in the American economy each year, Nick Hanauer wrote about it for The Atlantic last year. Biden then dropped an even-bigger truth bomb on Davos:

“When the middle class does well, the wealthy do very well, and the poor have a ladder up,” he said.

Joe Biden to rich people, basically: "You don't have to be less rich, but  poor people do have to be less poor.

Joe Biden to rich people, basically: “You don’t have to be less rich, but poor people do have to be less poor.”

This is the absolute truth, and the fact that Biden is dropping it on the Davos crowd, which has thrived on the trickle down concept that giving rich people more money will benefit everyone, is admirable. The fact is, tax cuts for the wealthy don’t create wealth, in part because rich people are rich because they’re very, very good at holding onto the money they make. You need the middle class to get a raise, because they will then spend that money on goods and services, thereby stimulating the economy and creating more good-paying jobs, which will continue the cycle in a positive feedback loop. And, yes, plenty of that money will flow upwards to the top one percent, meaning that we’re not asking the very rich to give up their Davos membership cards. The thing about economic inclusion is that it benefits everyone and not just the very rich.

2. When asked today on Good Morning America about his decision to boycott the Oscars because every single major nominee was white, Will Smith correctly identified diversity as “the American superpower.”

Smith and Biden seem to be working from the same inclusionary guidebook this week. Here’s Nick Hanauer on diversity:

The evidence is clear: diversity does not hinder growth—it supercharges it. That has always been America’s competitive advantage: we have the most diverse workforce in the world, and for all our problems, we do a better job of integrating diversity than anyone else. Diversity is America’s most valuable resource; it is what makes us the most innovative nation on Earth.

Let’s be clear: diversity is the morally right thing to do, but it makes economic sense, too. One of the most diverse action movie franchises of all time, the Fast and Furious series, also features the most diverse cast in Hollywood. If you think that’s a coincidence, you’re not thinking seriously about this. People like to see themselves in the movies they watch. As Smith says, his Oscar boycott “is about children that are going to sit down and they’re going to watch [the Oscars] and they’re not going to see themselves represented.” Those kids won’t be included, and they will feel as though Hollywood has excluded them. Without new, diverse generations of actors and directors and screenwriters, Hollywood will continue to make movies by and for an increasingly white population, and eventually the whole system will become irrelevant. In economics and in art, inclusion is key.

3. Joe Biden is about to have a lot of time on his hands; I’d love to see he and Will Smith team up to make an inclusive economics-themed buddy cop movie. But maybe that’s just me.

Daily Clips: January 21st, 2016

What *don’t* we know about gun violence because of the restrictions on federal research?Clare Foran takes a look at this question and the answers (or lack thereof) are extremely depressing.

“It’s actually kind of appalling,” said Sherry Towers, a professor at Arizona State University who has done research on mass shootings. “We’re one of the richest nations in the world, and we aren’t exactly forbidding scientists to look at this, but the federal government is strongly discouraging it.”

When a government is actively discouraging information that could help save American lives, you know there is something terribly corrupt going on. And we know why – because if the government can’t research gun violence then it becomes extremely difficult to pinpoint the precise impact of gun laws.

Many basic questions remain largely unanswered as a result…Do open-carry laws make gun violence worse, or do they cut down on firearm injuries and deaths? Researchers can’t say with certainty. They also don’t know much about the path that guns take in order to fall into the hands of criminals, or how gun laws impact firearm sales on the black market. For that matter, the psychology of gun violence is not well understood. What motivates people to use guns to commit a crime or suicide, and what are the most effective ways to stop mass shootings, gun-related homicide, and suicide? Limited research makes it challenging to reach well-supported conclusions.

Just today, Senator Ed Markey called for the ban on gun violence research to be overturned. Eventually, reason and research will prevail in this bloody topic.

Republicans ignore a poisoned city: The author, a former George W. Bush speechwriter, writes about the poisoning of Flint, Michigan’s water supply and laments how Republicans have given up on the city. He doesn’t think his party has completely ignored the situation because the majority of the population just happens to be black or poor. No, he says they haven’t touched on this subject at all because:

The party is accustomed to talking about policies and ideas to help urban America and then implementing them in safe, Republican-friendly areas like Idaho or Arizona. It’s not easy to go to a place where nobody knows you or likes you.

Cry me a river. See how he turned the blame from the party to the people? It’s the people of Flint’s fault for not “knowing” the Republican party or “liking” them. Give me a break.

Tweet of the day: 

Republicans’ Counterproductive Fixation On A Worst-Case Scenario That Never Happens

minimum wage increase

Bread lines: Not since before the minimum wage was created, and probably unlikely to be seen after it goes up. (Image: Library of Congress)

“Conservatives have argued for years that no matter how well-meaning, efforts to increase the minimum wage end up hurting the most vulnerable, those looking to grasp the first rung on the employment ladder,” writes right-wing blogger Jennifer Rubin in the Washington Post today. And while I, personally, would have just stopped the article right there with a quick note that, of course, those warnings have never actually come to fruition, she, of course, does not.

Rubin goes on to cite the problematic, incorrect, and generally underwhelming conservative, anti-minimum wage economist Mark Perry as a source (at least she’s consistent), and then proceeds to chide Democrats about how “the impact on employment and on the poor, specifically, may be profound” should we keep hammering on about raising wages. Her thesis: That we’re not thinking this through, and that, just as the right has been warning for literally decades, our efforts to increase wages could possibly end in disaster.

And yet, what Rubin never quite manages to get around to is the fact that the]is predicted apocalypse has yet to arrive, and likely never will.

Since its birth, the minimum wage has been drawing concern and outright ire from the right, who have warned of the economic fire and brimstone it will rain down upon us, ensuring that no teen will have a job and that businesses will be forced to shutter more quickly than you can say “trickle-down.”

Truly, the quotes go way back. In case you think I’m exaggerating, here are some:

  • 2006: “If a simple legislative act increasing the minimum wage to $7.75 is all that is needed to improve the lot of the working poor by just a little, then why not raise it to $10 an hour and get them to the poverty level? For that matter, why not raise it to $50 an hour, assuring every working Californian a comfortable living?” — California State Senator Tom McClintock in the Los Angeles Times
  • 1999: “Minimum wage increases that even approach an average livable wage would result in significantly fewer jobs for low-wage workers. A substantial increase in the relative cost of labor will result in a reduction in the amount of labor used.” Thomas Kavet, Deborah Brighton, Douglas Hoffer, and Elaine McCrate in a report delivered to the State Legislature of Vermont
  • 1970: “It is unrealistic to assume that somehow the increase will be squeezed out of profits….In plain fact, the burden of an increased minimum wage will fall heavily on those least able to bear it. The fringe employers, the unskilled worker, the young and the handicapped are those who will be priced out of the job market.” — The Chamber of Commerce
  • 1938: “[The Fair Labor Standards Act] will destroy small industry….[these ideas are] the product of those whose thinking is rooted in an alien philosophy and who are bent upon the destruction of our whole constitutional system and the setting up of a red-labor communistic [sic] despotism upon the ruins of our Christian civilization.” — Representative Edward Cox (D-GA). 1938.

Yes, the scary stories of the right have been spookily whispered in the ears of the working population for decades, allowing plenty of time for these ideas—that a minimum wage that’s actually livable will bankrupt businesses and lead to an explosion of unemployment—to fully marinate and become baked into the the collective understanding of the economy.

The unfortunate thing, though, for the ultra-wealthy who benefit off these ideas (because truly, no one else is) is that they are simply not true, and they don’t hold up.

Take, for example, Washington State—the state with the highest minimum wage in the nation—was recently ranked by Business Insider as having the most robust economy in the country.

“Its Q2 2015 annualized GDP growth rate was a stunning 8.0%, by far the highest among the states and DC. The November 2015 average weekly wage of $1,073 was the second highest in the country, and was 5.6% higher than the weekly wage in November 2014, the third highest wage growth rate,” they explained.

The next highest-ranked was the District of Columbia, which boasts a $9.50 minimum wage. After that was Colorado—also with a minimum wage higher than the Federal level—and then, down at #5 was Nebraska, a state whose “unemployment rate of 2.9% was the second lowest in the country,” and whose minimum wage is also above $7.25.

Does correlation necessarily indicate causality? Of course not. But it’s worth pointing out that economic growth in states with minimum wages above the Federal floor isn’t exactly stagnate. In fact, higher minimum wages actually seem to be spurring job creation and growth.

Which means that the only thing Rubin and I can agree on is her first statement—that Conservatives have been beating this drum for a long, long time.

Daily Clips: January 20th, 2016

Tweet of the day:

Sarah Palin may have lost her mind: Seriously.

2015 was the hottest year in recored history, NASA and NOAA say: That’s not good news. The New York Times reports,

Scientists started predicting a global temperature record months ago, in part because an El Niño weather pattern, one of the largest in a century, is dumping an immense amount of heat from the Pacific Ocean into the atmosphere. But the bulk of the record-setting heat, they say, is a consequence of the long-term planetary warming caused by human emissions of greenhouse gases.

Electric vehicle sales fall short of Obama’s goal: In 2008, Barack Obama set a goal of having “one million plug-in electric vehicles on the roads by 2015,” yet today we only have about 400,000 electrics cars on the road.

Ted Cruz To Working Mother: Don’t Push It On Paid Family Leave

Our Supreme Troublemaker pointing out the obvious.

Our Supreme Troublemaker pointing out the obvious.

Here at Civic Skunk Works, we’ve spent a quite a bit of time pointing out that trickle-down economics has never been anything more than an intimidation tactic masquerading as an economic theory. For decades, politicians (from both parties) and businesses have been employing this tactic in order to scare workers into paralysis. Think about the claims which trickle-down proponents have repeated over and over again:

  • “If you raise the minimum wage, jobs will be lost.”
  • “If you tax the wealthy, jobs will be lost.”
  • “If regulation of the powerful goes up, jobs will be lost.

In short, don’t push it, buddy.

And this Monday, Ted Cruz provided a perfect illustration of this bullying tactic. The Texas senator was asked by a mother of four “what he would do about the current lack of federally mandated paid family leave.” A very good question on a very important subject which affects all working Americans. According to Think Progress, Cruz callously replied:

Giving away free stuff is very easy for politicians to do, but the simplest rule of economics is TANSTAAFL — there ain’t no such thing as a free lunch. Anything a politician gives you, he must first take from you. And so if you have the federal government mandate paid medical leave, what that ends up doing is driving up the cost of labor for low-income workers.

What he’s saying is: don’t ask for too much or you’ll be priced out of a job. And just in case this mother of four missed the veiled threat, he hammers the point home when he adds, “And by the way, if you get fired or laid off, not only do you not get paid family leave but you don’t get a paycheck either.”

Do you see how slimy this strategy is? Do you see how strong-handed this approach is? Do you see how they are striking fear and doubt into the minds of American workers?

And this isn’t anything new. This is how Republicans and businesses have been framing workplace benefits for a very long time. They’ve perpetually tried to scare the American worker by threatening to cut their jobs if they ever asked for too much. (What they define as “too much” has been ever-changing. Forty years ago occupational health and safety fit under such a category, today it’s paid leave, tomorrow it may be vacation time.) In economically anxious times they know this intimidation tactic often works. Why take a chance and try to push for better benefits if your job is already in the balance?

The truth is paid family leave is actually good for businesses, the worker, and society in general. For businesses specifically paid leave improves worker retention, increases worker productivity, and improves employee loyalty and morale. How do we know this? Well, for one, paid family leave insurance programs “are already working well in California, New Jersey, and Rhode Island.” That’s right – paid leave already exists in the three states and none of those state economies has nosedived into economic catastrophe. As Think Progress highlights:

Evidence from the first two states shows that [paid family leave programs] haven’t hurt employers. About 90 percent of California businesses say that it either had a positive impact or none on profitability, employee performance, and productivity, while it helped reduce turnover, saving them an estimated $89 million each year. The majority of New Jersey businesses surveyed also said that it hasn’t hurt their finances and some saw a benefit.

The job-killing dystopia which Ted Cruz foreshadowed to the mother of four is simply a trick. Thankfully, we know why politicians like Cruz are continuing to sell this scam to the American worker: because if he can get workers to believe this scary tale, big businesses and their politicians win.

Daily Clips: January 19th, 2016

Barack Obama was the winner of Sunday’s Democratic debate: Did you tune in to watch Bernie, Hillary, and the other guy debate after Sunday football? Probably not, and that brings a smile to the face of Debbie Wasserman Schultz!

If you by any chance did watch the extremely well-moderated debate, you would have noticed that Barack Obama’s name and legacy were enthusiastically embraced by all candidates on stage – especially Hillary Clinton. As Vox’s Dylan Matthews noted,

[Hillary] also cited Sanders’s past criticisms of the president and flirtation with supporting a primary challenge against him in 2011/2012…Clinton’s message is clear: I am the true defender of Obama’s legacy, I will preserve his gains, while Sanders dismissed them.

This may seem like a strange strategy, especially if you watched the Republican debate earlier in the week. There, Obama was portrayed as nothing short of evil. Yet within Democratic circles, the current president is seen in a very positive light. Consider this:

To put these numbers in perspective, George W. Bush’s approval among Republicans in 2007 sat at 70 percent – 17 points lower than Obama’s standing with Democrats today. For this reason, expect the Democratic nominee to not distance themselves from the president like John McCain did with Bush.

Weekly bashing of David Brooks: As most reader(s) of Daily Clips will know, I have a habit of rebutting columns written by the New York Times columnist David Brooks. Why specifically him? Because he’s a “middle-of-the-road Republican” that asks all the right questions, but then ends up with the wrong answers. He’s so close to being politically sane. Unlike Breitbart or Fox News, Brooks lives an examined life, yet he all too often falls back on faulty assumptions about life and politics.

This week, he’s basically arguing that it would be terrible for the Republican party if either Cruz or Trump wins the nomination. No faulty logic there. He believes “there’s a silent majority of hopeful, practical, programmatic Republicans. You know who you are.”

To cure Republican voters from the anger and contempt of this election cycle Brooks argues that “maybe it’s time a center-right movement actually offered” an agenda that dealt with “working class populism, religious compassion and institutional reform.” Read this as: Rubio is our only hope, Republican establishment.

Which is a pathetic option. Because Rubio, as we saw in the last debate, is willing to go angry Republican Dad to get the nomination. And Brooks isn’t the only one hoping for a Rubio surge. A similar call to action was raised in Michael Gerson’s latest column. The intellectual conservative class has finally understood that their party has lost the plot. But to offer Rubio as the bastion of the center-right? Give me a break.

Tweet of the day: This headline made me smile.