It's Time for Honesty About Rural America

As the beginnings of the 2020 presidential campaign heat up, much focus will be directed towards attracting the votes of rural voters and those in "rust belt" states.   As a piece in the New York Times points out, many politicians will make pie in the sky promises and seek to avoid speaking honestly about rural  and delivering a truthful message that rural voters do not want to hear:  No one knows how to fix the downward decline of rural areas that have seen farming consolidate into large corporate ventures as family farms fall in number and industries such as coal shrink due to changing global economic forces.  In Southwest Virginia, the Northam administration is trying to expand broadband Internet access to aid competitiveness, but rural areas simply are not attractive to many industries and businesses no matter what the Internet access may be.  Improving Interstate 81 would help transportation wise for through traffic, but likely do little to grow shrinking towns and businesses.  For many rural residents, sadly, the true solution may be to leave for more urban areas.  Here are highlights from the Times piece:

Democratic presidential hopefuls are crisscrossing Iowa, trying to assure farmers that they share their concerns. Commentators are publishing opinion pieces about how Democrats can win back rural voters. Think tanks are issuing manifestoes about reviving heartland economies.

There’s nothing wrong with discussing these issues. Rural lives matter — we’re all Americans, and deserve to share in the nation’s wealth. Rural votes matter even more; like it or not, our political system gives hugely disproportionate weight to less populous states, which are also generally states with relatively rural populations.

But it’s also important to get real. There are powerful forces behind the relative and in some cases absolute economic decline of rural America — and the truth is that nobody knows how to reverse those forces.

Many of the problems facing America have easy technical solutions; all we lack is the political will. . . . . But reviving declining regions is really hard. Many countries have tried, but it’s difficult to find any convincing success stories.

What’s the matter with rural America? Major urban centers have always been magnets for economic growth. They offer large markets, ready availability of specialized suppliers, large pools of workers with specialized skills, and the invisible exchange of information that comes from face-to-face contact. As the Victorian economist Alfred Marshall put it, “The mysteries of the trade become no mysteries; but are as it were in the air.”

But the gravitational pull of big cities used to be counteracted by the need to locate farming where the good land was. . . . Nor was farming the only activity giving people a reason to live far from major metropolitan areas. There were, for example, almost half a million coal miners.

[H]owever, while America’s population has doubled, the number of farmers has fallen by two-thirds. There are only around 50,000 coal miners. The incentives for business to locate far from the metropolitan action have greatly diminished. And the people still living in rural areas increasingly feel left behind.

Some of the consequences have been tragic. Not that long ago we used to think of social collapse as an inner-city problem.  Nowadays phenomena like the prevalence of jobless men in their prime working years, or worse yet, the surge in “deaths of despair” by drugs, alcohol or suicide are concentrated in declining rural areas.

And politically, rural America is increasingly a world apart. For example, overall U.S. public opinion is increasingly positive toward immigrants. But rural Americans — many of whom rarely encounter immigrants in their daily lives — have a vastly more negative view.

So what can be done to help rural America? We can and should make sure that all Americans have good health care, access to good education, and so on wherever they live. We can try to promote economic development in lagging regions with public investment, employment subsidies and, possibly, job guarantees.

But as I said, experience abroad isn’t encouraging. West Germany invested $1.7 trillion in an attempt to revive the former East Germany — more than $100,000 per capita — yet the region is still lagging, with many young people leaving.

I’m sure that some rural readers will be angered by everything I’ve just said, seeing it as typical big-city condescension. But that’s neither my intention nor the point. I’m simply trying to get real. We can’t help rural America without understanding that the role it used to play in our nation is being undermined by powerful economic forces that nobody knows how to stop.

Rural voters will not like this message, but that doesn't mean it is not accurate.

Economic Change Rattles America and Europe

One constant throughout history is that change over time is guaranteed and that changes in technology and industry are constant, often at the expense of many classes of people who find their economic world turned upside down as industries and economic ways of life they thought unchangeable begin to die and wither away.  The resulting angst and financial distress are causing convulsions across the developed world, especially in rural areas that have not embraced and/or been able to change see their social and economic reality crumble.  The first glimpse of the danger posed by the phenomenon was the British Brexit vote that was sold to many on the deliberate lie that the exit from the European Union would allow the recapture of a glorious past.  The reality is that Brexit will constitute a form of economic suicide for many Britons, especially those in rural areas.  Next we saw the convulsion in the United States that put the thoroughly corrupt and unfit Donald Trump in the White House.  Now, we are seeing convulsions in France where those left out of the new economic model are violently protesting.  I totally understand the fear and anxiety of those reacting to change, but trying to resist the inevitable is not the answer and, indeed, threatens long term economic and political stability - and sets the stage for dangerous demagogues - as a column in the New York Times notes.  Here are excerpts:

Ever since World War II, the liberal global order that has spread more freedom and prosperity around the world than at any other time in history has been held up by two pillars: the United States of America and the United Nations of Europe, now known as the European Union.

Both of these centers of free markets, free people and free ideas are being shaken today by rural and beyond-the-suburbs insurgencies of largely white working-poor and anxious middle classes, which have not generally benefited from the surges in globalization, immigration and technology that have lifted superstar cities like London, Paris and San Francisco and their multicultural populations.

Having just seen the shocking sight of Parisian stores boarded up right before Christmas to protect against rioting along the Champs-Élysées by some of France’s yellow-vested protesters; after being told in Rome a few days earlier that Italy, a founding member of the E.U., could conceivably shuck off both the E.U. and the euro one day under its new bizarre far-left/far-right governing coalition; after watching Britain become paralyzed over how to commit economic suicide by leaving the E.U.; and after watching President Trump actually cheer for the breakup of the E.U. rather than for its good health, it is obvious to me that we’re at a critical hinge of history.

The core challenge for both the U.S. and the E.U. is the same: These rapid accelerations in technology and globalization have brought many more immigrants into many more remote corners of their societies — public housing in Paris today is dominated by immigrants — at the same time as many long-frozen social mores have changed — like acceptance of gay marriage and transgender rights — and as average work no longer returns an average wage that can sustain an average middle-class lifestyle.

The middle classes that powered the growth of the U.S. and the E.U. in the 20th century were built on something called a “high-wage, middle-skilled job.” But robotics and artificial intelligence and outsourcing and Chinese imports have wiped out a lot of middle-skilled routine white-collar and blue-collar work.

Now there are high-wage, high-skilled jobs and low-wage, low-skilled jobs. But high-wage, middle-skilled jobs are vanishing, leaving a considerable cohort of people with stagnant incomes and burning resentments at the globalized city slickers who they think look down at them and have mastered the nonroutine skills required for a high-wage job today.

When you simultaneously challenge all these things that anchor people — their sense of home, their job security, their prospects for growth and the social norms that, for better or worse, defined their lives — and then amp it all up with social networks, you can get a really ferocious blowback, as France’s president, Emmanuel Macron, saw across his country.

It is going to take extraordinary leadership for the U.S., Britain and the E.U. to come up with a strategy for these grievances.

It has to balance the need for economic growth and redistribution, the need to take care of those who have been left behind without burdening future generations, the need for free-flowing borders to attract new talent and ideas, and the need to prevent people from feeling like strangers in their own homes.

But that leadership is not present. I get why a slim majority of U.K. citizens voted for Brexit — as it was sold to them. They were told they could curb all the stuff they didn’t like — such as a flood of 2.2 million foreign E.U. workers — and still keep all the stuff they liked — mainly Britain’s free access to the E.U. market — and give up nothing. But it was all a lie.

And to now watch the Conservative Party hacks who pushed that lie, led by Boris Johnson, continue to demand that their prime minister deliver this fantasy Brexit in the face of the reality that it’s impossible — and in the face of how bad even the second-best option will be — is to watch a once-sane country write a suicide note in a moment of irrationality and then argue endlessly over how to carry it out — death by hanging, poison or a gunshot to the head. They’ve got to reconsider. Disconnecting in a connected world is nuts.

Macron, by contrast, dared to do the right things to unlock growth in France, at the right time, “but he did not understand the difference between being right and doing it right,” a French economist, Ludovic Subran, told me. And he did not understand how his policies differently affected “the beer drinkers and the wine drinkers.”

Macron pushed through four vital structural fixes that fostered growth: pro-investment tax reforms, reduced pensions for the bloated railway union, relaxed labor rules to make it easier to fire and hire workers, and big new public investments in skills and education for the most disadvantaged.

To save his presidency, a shellshocked Macron busted his budget and canceled the fuel tax hike, raised the minimum wage by 100 euros ($114) a month and scrapped a planned tax on pensions under 2,000 euro ($2,272) per month. But because the Yellow Vests have no leader, no one knows what happens next.

“France today has a leader with no followers and an opposition with no leader,” said U.S. foreign policy expert Michael Mandelbaum.

And the reason that matters is France and Germany were always the two adults whose partnership and adherence to the E.U. budgets and standards were the cement that held the whole E.U. pillar together.

I think the countries that will thrive in this era are the ones that have the most nimble cities, with the most nimble local leaders, who build adaptive coalitions of businesses, educators and social entrepreneurs, who can compete locally, regionally, nationally and globally.

In this world, highly centralized countries will fare much worse than decentralized ones. That’s the real shift France has to make, and, if it can’t, watch out for falling pillars. France matters.

Dominique Moïsi, one of France’s top foreign policy analysts, put it to me like this: At a time when America, which was always the European Union’s life insurance policy against predatory threats from the East and was the world champion of democracy, begins to withdraw from the world; when Russia returns with a vengeance to global politics; when Germany turns inward and Italy rebels against E.U. spending limits and moves closer to autocratic Russia; when so many roads now lead to Beijing; and when the U.K. is hellbent on suicide, “suddenly what happens in France goes beyond France. We are the last barrier protecting the European idea. If Macron fails, it can bring the end of Europe.”

Frighteningly, lurking among those feeling dispossessed is the same sort of nationalism and xenophobia that gave rise to WWI and WWII.  All that is lacking for now is a dangerous demagogue ready to light the fuse. 

Remembering How the Nazis Gained Power in Germany

As we see civic discourse coarsened daily by the occupant of the White House, immigrant children being held in cages, daily attacks on the free press, and the constant scapegoating and demonizing of minorities, it is critical that we remember how the Nazi regime came to power in Germany  in the 1930's. A book review of a new book, "The Death of Democracy, Hitler’s Rise to Power and the Downfall of the Weimar Republic," offers a sobering look at what happened in Germany in the late 1920's and early 1930's, as Germans tried to deal with devastating defeat in WWI and the Great Depression and economic globalization more generally.  Indeed, WWI itself was largely triggered by German and British competition in the global markets.  While the book does not seek to draw parallels between Hitler and the Trump/Pence regime, there are very disturbing parallels.  One is that the Nazis claimed a mandate when they won 37% of the German vote.  In 2016, Trump won only 28% of the American vote, yet he and his Christofascist and white supremacist base boast a mandate and that they represent "real Americans."  As Germany slide toward dictatorship, too many Germans sat on the sidelines, were too disinterested to act, or did not want to confront Nazi supporters when there was still an opportunity to avert disaster.  Here excerpts from the book review:

We ask about the rise of the Nazis from what we think is a great distance. We take for granted that the Germans of the 1930s were quite different from ourselves, and that our consideration of their errors will only confirm our superiority. The opposite is the case. 

Although Benjamin Carter Hett makes no comparisons between Germany then and the United States now in “The Death of Democracy,” his extremely fine study of the end of constitutional rule in Germany, he dissolves those comforting assumptions.

He presents Hitler’s rise as an element of the collapse of a republic confronting dilemmas of globalization with imperfect instruments and flawed leaders. With careful prose and fine scholarship, with fine thumbnail sketches of individuals and concise discussions of institutions and economics, he brings these events close to us.

The Nazis, in Hett’s account, were above all “a nationalist protest movement against globalization.” Even before the Great Depression brought huge unemployment to Germany, the caprice of the global economy offered an opportunity to politicians who had simple answers. In their 1920 program, the Nazis proclaimed that “members of foreign nations (noncitizens) are to be expelled from Germany.” Next would come autarky: Germans would conquer the territory they needed to be self-sufficient, and then create their own economy in isolation from that of the rest of the world. As Goebbels put it, “We want to build a wall, a protective wall.”

Hett . . . . describes a moral crisis that preceded a moral catastrophe. If Jews were held responsible for what happened in Germany, then Germans were victims and their actions always defensive. Political irresponsibility flowed from the unfortunate example of President Paul von Hindenburg. . . . . Hindenburg could not face the reality of defeat on the Western Front in 1918, and so spread the lie that the German Army had been “stabbed in the back” by Jews and Socialists. This moral weakness of one man radiated outward. . . . Without Hindenburg’s founding fiction and odd posturing, it is unlikely that Hitler would have come to power. [T]he Nazis were the great artists of victimhood fiction. Hitler, who had served with German Jews in the war, spread the idea that Jews had been the enemy within, proposing that the German Army would have won had some of them been gassed to death. Goebbels had Nazi storm troopers attack leftists precisely so that he could claim that the Nazis were victims of Communist violence. Hitler believed in telling lies so big that their very scale left some residue of credibility. The Nazi program foresaw that newspapers would serve the “general good” rather than reporting, and promised “legal warfare” against opponents who spread information they did not like. They opposed what they called “the system” by rejecting its basis in the factual world. Germans were not rational individuals with interests, the reasoning went, but members of a tribe that wanted to follow a leader (Führer). [T]he electoral rise of the Nazis in the late 1920s and early 1930s had less to do with his particular ideas and more to do with an opening on the political spectrum. The Nazis filled a void between the Catholic electorate of the Center Party and a working class that voted Socialist or Communist. Their core constituents, Hett indicates, were Protestants from the countryside or small towns who felt themselves to be the victims of globalization. In Germany in the 1930s, as elsewhere, elections continued even as their meaning changed. The fact that the Nazis used violence to intimidate others meant that elections were not free in the normal sense. And the system was rigged in their favor by men in power who had no use for democracy or for democrats. . . . . They tended to confuse their particular interests in lower wages and higher military spending with those of the German nation as a whole. Constitutions break when ill-motivated leaders deliberately expose their vulnerabilities. Certainly this was the case in Germany in 1930. President Hindenburg was technically within his rights to dissolve the Reichstag, name a new chancellor and rule by decree. By turning what was meant to be an exceptional situation into the rule, however, he transformed the German government into a feuding clique disconnected from society. . . . The Nazis took advantage of an opportunity created by people who could destroy a republic while lacking the imagination to see what comes next.

When elections were called in 1932, the purpose was not to confirm democracy but to bring down the republic. Hindenburg and his advisers saw the Nazis as a group capable of creating a majority for the right. The elections were a “solution” to a fake crisis that had been, as Hett puts it, “manufactured by a political right wing that wanted to exclude more than half the population from political representation and refused even the mildest compromise.”

The Nazis won 37 percent of the vote, and Hitler became chancellor in January 1933. A few weeks later, he used the pretext of the arson of the Reichstag to pass an enabling act that in effect replaced the constitution.

Hindenburg died in 1934 believing that he had saved Germany and his own reputation. In fact, he had created the conditions for the great horror of modern times. Hett’s book is implicitly addressed to conservatives. Rather than asking how the left could have acted to stop Hitler, he closes his book by considering the German conservatives who aided Hitler’s rise.  . . .  The conclusions for conservatives of today emerge clearly: Do not break the rules that hold a republic together, because one day you will need order. And do not destroy the opponents who respect those rules, because one day you will miss them.

Sadly, Americans know very little history and most are too lazy to educate and enlighten themselves.  Mistakes from the past can and do repeat themselves.  To avoid them, we need to know what the mistakes were and what should have been done to avoid them so that they are not repeated under similar toxic and dangerous politicians.

Are Wrongheaded U.S. Policies Ceding the Future to China?

HMS Hood steaming to meet Bismark - a  heroic but sad symbol of
a failure to recognize the forces of technological and economic change

A piece in the New York Times has a piece that suggests that Donald Trump, a/k/a Der Trumpenführer, may be about to ignite a trade war with China.  The move stems from apparent growing concerns in the United States over a Chinese government-led effort to make the country a global leader in microchips, electric cars and other crucial technologies of the future. Unlike the orthodoxy of the GOP which wants to crush government regulations - including worker and public safety regulations - in China the ideology is to have government work with industry and foster the best possible economic future if for no other reason than the fact that economic success helps the Chinese leadership stay in power.  Thomas Friedman argues that Trump and his isolationist regime where ignorance is embraced and inconvenient facts are ignored or labeled "fake" are taking the wrong course and that the main beneficiary will be China going forward.  In many ways, as explained below, America finds itself where Great Britain was at the end of WWI.  Will American leadership make the same mistakes? Here are column highlights: 

I have a simple view of governing today: We are in the middle of not one but three climate changes at once to which government must help citizens respond — and Donald Trump doesn’t have a clue and China does. 

In the past you could fix any climate/environmental problem later or now. But today later is officially over. Later will be too late. At some point, the deforestation of the Amazon is not reversible.

We are the middle of a change in the “climate” of globalization. We are going from an interconnected world to an interdependent one, and in such a world your friends can hurt you faster than your enemies: Think what happens if Mexico’s economy fails. And your rivals’ falling becomes more dangerous than your rivals’ rising: We will be hurt a lot more by China’s economy tanking than its putting tanks on islands in the South China Sea.

And lastly we’re in the middle of a change in the “climate” of technology. We’re moving into a world where machines and software can analyze (see patterns that were always hidden before); optimize (tell a plane which altitude to fly each mile to get the best fuel efficiency); prophesize (tell you when your elevator will break and fix it before it does); customize (tailor any product or service for you alone) and digitize and automate just about any job. This is transforming every industry.

Governing today is all about how you prepare your society to get the most out of these three climate changes and cushion the worst. Sadly, that’s not our society’s priority right now. In the age of Trump we are treating governing as entertainment. Some conservatives argue that’s fine. The less D.C. does, the better. Let the market rule. I disagree. What actually made America great was a government that prepared the right soil in education, regulation, immigration, research and infrastructure, and a dynamic private sector that grew all kinds of flowers in that soil.

Which brings me to China. China takes governing seriously — in a cruel way and in an impressive way. Its leaders wake up every morning and ask themselves two questions. First, how do we stay in power?

China’s leaders are just as focused on asking a second question: What world are we living in? Which leads to: What are the biggest forces shaping this world? And what kind of national strategy do we need so our people can get the most out of these forces and cushion the worst?

They know we’re in the midst of these three climate changes and have formulated a strategy — “Made in China 2025” — to thrive within it. It’s a plan for building the infrastructure, investments, education and regulations that will enable Chinese companies to lead in supercomputing, new materials, computer-controlled machine tools, industrial robotics, space and aviation equipment — including drones — clean cars, clean energy, biomedicine and next-gen medical devices.

By contrast, Trump hasn’t even named a science adviser. He pulled out of the Paris climate accord without any input from scientists, and he proposed a budget for fiscal 2018 that eliminated the Department of Energy’s innovation lab (the “Advanced Research Projects Agency — Energy”) and slashed funding for all of our key national science and medical labs, which provide the basic research for the very next-gen technologies in which China is now massively investing. He’s spending the money instead on a wall against Mexico. Is there anything more stupid?

And then you watch the health care debate. And then you realize that in addition to the executive branch, one of our two parties has gone nuts. For seven years the G.O.P. made replacing Obamacare, which needs improving, its top goal . . . . it was clear that it had done no homework on a better plan or built any intraparty consensus for it. It was all a fraud.

And then you look at all the knife fights between rival Trump aides and you realize that none of these fights were over how to thrive in a world challenged by these three climate changes. They were all about who could get closest to and flatter our Dear Leader most. But our Dear Leader — as we saw in the health care debate — has done no homework on the future, either. He’s been too busy promising to restore the past.

This is so dangerous. When the pace of change accelerates in climate, technology and globalization all at once, small errors in leadership navigation can have huge consequences. It’s like a 747 pilot who enters the wrong navigational coordinates. You can find yourself so far off course that the pain of getting back will be staggering.

We have such a pilot. It is time for the adult Republicans and Democrats in Congress to come together and take the helm.

Back to Great Britain.  On the eve of WWI, Britain was the most powerful nation on earth with a military, especially its navy, second to none.  It had lead the way in industrialization in the 19th century and had reaped huge economic benefit.  But things were changing.  Germany was rapidly gaining on Britain industrially and economically and science and the technology of the day was changing rapidly.  By the end of WWI, Britain's industrial base had become antiquated and leading industrial strength was moving towards the United States and even Japan.  Britain's leadership turned inward, failed to see the crucial need to modernize with the government leading the way.  By the eve of WWII, while still powerful, Britain had been eclipsed by America, Germany and Japan, the latter two of which had governments that pushed and controlled the modernization of their industrial bases, albeit for militaristic and imperial purposes. Will Trump and the GOP take America on a course akin to Britain's mistaken path?  Right now, I fear the answer is yes.  If this happens, Americans need to get used to the idea of America no longer being the world's leading power and economy.   

Brexit and Britain’s - and America's - Delusions of Empire

The parallel's between those in Britain who voted for Breixt and white Americans who voted for Donald Trump, a/k/a Der Trumpenführer, are remarkable.  In both instances, the two groups long for a perceived glorious past and a seek to reject modern economic reality and the fact that globalization and emerging economies make the days of "good old days" of yesteryear impossible to a bring back.  For the British, it's a longing of Imperial Britain on the eve of World War I when things may have been good for many whites in Britain proper, but not so wonderful for many of the subject peoples.  For Trump voters, it's the days immediately post World War II when America dominated the world, segregation at home maintained white privilege and minorities "knew their place" and gays, for their part remained largely invisible.  One irony is that America, with its crumbling infrastructure and disproportionate military spending is making the same mistake made by Britain post WWI when it failed to modernize its infrastructure and industries to remain competitive.  With China, India and other economies rising, going back to the late 1940's and 1950's simply isn't going to happen no matter what false promises Trump made to the gullible and .those motivated by bigotry.  A piece in the Washington Post looks at British delusions and indirectly makes the case for a wake up call by Trump supporters in the USA.  Here are excerpts:

[I]t’s Brexit supporters who may be in line for a real shock. Even beyond the coming “traumatic” loss of access to the E.U.’s market — as the Economist put it — the promise of a politically resurgent Britain is likely to fall flat.

Much of the rhetoric of the pro-Brexit crowd centers around the reclamation of British “sovereignty” from technocrats in Brussels. But Brexit proponents have also projected a nostalgic vision of Britain once more asserting itself as a dominant player on the world stage. May trumpeted the dawn of a new “Global Britain” earlier this year: a nation shorn of its continental commitments and capable of finding a new accommodation with other parts of the world — especially those it once colonized.

Brits are hardly alone in harboring delusions of empire — consider, for example, the colonial nostalgia of France’s far-right nationalists or the Ottomania of Turkey’s ruling party. But the fantasy of Britain’s past collides almost farcically against Britain’s present.

Never mind that Britain’s empire was a precursor to the forces of globalization and migration that the Brexiteers so profoundly resent.

Never mind that Brexit will “be a considerable blow to Commonwealth nations that export to Britain,” as the Financial Times reported: “Thirty-two Commonwealth countries, mainly in Africa and the Caribbean, are covered by free-trade agreements with the E.U. These states therefore enjoy duty-free and quota-free access to the E.U. for nearly all their goods. . . . Once the UK is out of the E.U., these countries will end up paying $800m a year in additional duties to access the UK market, according to an analysis by the Commonwealth Secretariat.”

The reality is that many Commonwealth nations simply don’t need Britain. Australian exports to its former colonial ruler amounted to just 1.4 percent of its total outgoing trade. Canada, which shares a huge land border with the United States, will always look south, not east. India, once the jewel in Britain’s imperial crown, has an economy already roughly the same size as Britain’s; Indian moguls now own some of Britain’s most iconic companies.

“In anglophone Africa, the game is already up,” British historian David Olusoga noted in the Guardian. “The motorbikes on the freeways of Accra and Lagos are Chinese, assembled by local mechanics from kits shipped direct from Shandong. 

“Brexit is rooted in imperial nostalgia and myths of British exceptionalism, coming up as they have — especially since 2008 — against the reality that Britain is no longer a major world power,” British academic Tom Whyman wrote in a withering column. “Those most under the spell of imperial nostalgia have now become the sorcerers themselves, having somehow managed to conjure up a mandate to transform Britain in their image.”

The myth of British exceptionalism.  Sound familiar?  America suffers from a similar delusion and myth making.  Clinging to myths and what allows one to avoid thinking  is not the answer to achieving prosperity and a just society. Brexit supporters and Trump supporters are both in for a rude shock and the economic pain will be self-inflicted. 

Trump Supporter Could Learn From Britain's Self-Inflicted Wounds

Many British voters who supported the Breixt vote to have the United Kingdom exit the European Union acted from with motivations akin to those of Trump voters: racism, anti-immigrant animus, religious based hatred, the embrace of ignorance, and fear of modernity and globalization.  Now, many of these voters are having second thoughts about their vote and may yet rue the consequences of their vote.  Not only is Scotland pushing to now have a vote to leave the UK so that it can remain in the European Union as an independent nation, but today German Chancellor, Angela Merkel signaled that the trade consequences of the Brexit vote could wreak havoc on the United Kingdom's international trade.  Falling for appeals to racism, religious based animus, and a false sense of superiority can bring about severe financial consequences as I believe many Trump voters will ultimately learn.  The Independent looks at today's action by Merkel which will without a doubt likely harm Britain's economy and, in my view, deservedly so.  Here are highlights:

Angela Merkel has dealt an instant blow to Theresa May's plan for Brexit by rejecting the PM's plan for trade talks to take place at the same time as Article 50 secession negotiations.

Britain will be put into the slow lane for discussions about any future trade deal with the EU following an intervention by the German Chancellor, who intervened just hours after the UK invoked Article 50.

Ms May had called for talks on a future comprehensive trade deal between the EU and UK to take place at the same time as the so-called 'Article 50' talks on how Britain will exit the bloc.

Ms Merkel today however said that talks on British divorce terms would take place first, after which talks on a future relationship would "hopefully soon" take place. The intervention could potentially make the Brexit process significantly more arduous for the UK.

The German Chancellor told reporters in Berlin: "The negotiations must first clarify how we will disentangle our interlinked relationship... and only when this question is dealt with, can we, hopefully soon after, begin talking about our future relationship."

Ms Merkel's unpicking of Ms May's plan also comes as European Parliament chief negotiator Guy Verhofstadt explicitly ruled out giving the UK a better trade deal in exchange for better security or defence arrangements. The Prime Minister had also repeatedly and explicitly linked "economic and security cooperation" in her Article 50 letter.

If the German leader gets her way Britain might not see a final comprehensive trade with with the EU for years, and almost certainly not before the next general election in 2020. The UK would also likely have to rely on a transitional arrangement with the bloc after it leaves but before a separate trade deal can be negotiated. 

The German Chancellor pledged that she would do all she could to make sure the talks were “fair and constructive” and said she hoped British negotiators would do the same.

Britain now has two years to negotiate a divorce deal with the European Union, which will cover issues such as whether Britain owes the bloc any money.

If Trump voters in West Virginia and Kentucky can pry themselves away from Fox News, they might like to read up on what the British counterparts have likely doe to themselves.

Trump's Dangerous Economic Nationalsm

For Donald Trump and his most loyal followers, real objective facts do not matter.  Rather, for Trump, when not satiating his own ego, "facts" are whatever he needs to support his demagoguery. For his followers, "facts" are whatever allows them to blame others for their bad decisions - e.g., dropping out of high school or not pursing a college degree - and misfortunes.  The problem is, however, that objective reality and true facts  do not change to fit the needs of a demagogue or those who live detached from reality.  Nowhere is this more true than in economic and foreign trade policies.  Trump readily blames foreign trade and/or trade agreements for the decline of American jobs, but the true cause overall is something far different: automation and technological advances.  Plants that once needed thousand of workers can now operate - often at higher outputs - with a fraction of the number of workers. A column by an economist in the Washington Post looks at the dangerous falsehoods in Trump's economic nationalism.  Here are excerpts:

For starters, it vastly exaggerates the role of trade in destroying U.S. jobs. Of course, many American factories have shut, and their production has moved abroad (Mexico, China) or been replaced by the imports from foreign competitors. But these losses don’t explain the steep declines in manufacturing jobs, which dropped a third since 1990 (from almost 18 million to 12 million in 2015), even though factory output — of planes, earth-moving equipment, pharmaceuticals, computer chips — nearly doubled over the same years. Automation is the main cause. 

The often-overlooked truth is that the U.S. economy, despite much rhetoric to the contrary, is less globalized than virtually all other advanced countries. We produce most of what we consume. True, we imported nearly $2.8 trillion of goods and services last year, but we also exported almost $2.3 trillion. As a share of the $18 trillion economy, the deficit was less than 3 percent and about half its 2006 level. 

The danger of economic nationalism is that it deludes us into thinking that our problems mainly originate abroad and can be fixed by “tougher” trade policies. Not so. It’s worth recalling that the two largest economic setbacks since World War II were both domestic in origin: the high inflation of the late ‘70s, peaking at more than 13 percent (caused by easy money); and the 2008-2009 financial crisis (caused by reckless financial speculation). 

Although the United States should pursue its economic interests, it’s doubtful that trade concessions will cure chronic trade deficits. These mainly reflect the dollar’s role as the major international money for trade and international investment. Demand for dollars by foreigners raises the currency’s value, putting U.S. producers at a competitive disadvantage in global markets. This is unfair to American factories and farms, but the alternative — ruining the dollar through high inflation or exchange controls — would be worse.

Trade remains foreign policy. It’s true that today’s circumstances are very different from those after World War II. But the basic reality endures: Who we trade with and how are expressions of national purpose and power. Trump is wrong to reject the Trans-Pacific Partnership, which would encourage trade between the United States and other Pacific-rim countries, creating an alternative to a China-dominated system. 

Trump’s economic nationalism . . . . Down that path lie protectionism, isolationism, more trade conflicts and threatened economic growth. It would redefine America’s relationship with the world. 

The High Cost of the GOP's Populism

With the blame game having started in the wake of Donald Trump's fall in the polls, many Republicans are blaming each other for the problems faced by their party .  Hard core Trump supporters blame the "never Trump" Republicans and/or the "Republican elites" for Trump's decline.There is little effort among the majority of Republicans to admit that  (i) their party selected a horrific candidate and (ii) past GOP policies, including fanning the flames of racism, have helped create the anger that is the main force behind Trump's support. Conservative columnist Michael Gerson puts the blame across the board and particularly goes after the ultra conservatives in Congress.  Here are column highlights: 

With defeat now the likely outcome for the Republican presidential nominee, the blame shifting has begun early and in earnest.

Isn’t it more likely that Republicans are losing because their candidate has committed enough gaffes to torpedo 10 campaigns? Because he has premised his appeal on prejudice? Because he displays no appreciation of constitutional values and offers himself as a strongman? Because he has no knowledge of, or interest in, public policy? Because he is an erratic narcissist with a compulsive need to crush and humiliate his critics? Holding Never Trump forces responsible for all this is akin to blaming the spectators in Lakehurst, N.J., for the Hindenburg disaster. The pointing and gawking did not cause the flames.

A more sophisticated form of blame by other conservatives goes like this: Yes, Trump is a poor vehicle for the blue-collar, populist revolt, but that uprising was invited by the arrogance and indifference of globalized elites, including Republican elites. Chief executives, politicians and Wall Street types live in a bubble of affluence, caring little for American interests and lacking sympathy for their fellow citizens who are sinking into despair, addiction and the floodwaters of Louisiana.

For the record, I am in favor of the Davos set becoming more sensitive to the struggles of their countrymen. But all these fat cats at Coca-Cola, Monsanto, Pfizer and Microsoft deserve at least a bleat in response. They are leading participants in an economic system — with its global supply chains, freely moving capital and rapid innovation — that, during the past 20 years, has taken about a billion people out of extreme poverty around the world. This is arguably the greatest humanitarian achievement in history.

The United States has benefited from being the most engaged and adaptable economy in this global system — selling goods in other countries and buying goods (cars, smartphones, clothing) that have dramatically improved the daily lives of nearly every American. But rapid economic change has also laid waste to whole industries and the communities sustained by them, resulting in toxic stress and terrible suffering. Since the 1940s, American manufacturing output (as a percentage of gross domestic product) has been remarkably stable. But manufacturing employment has fallen by about two-thirds (as a percentage of the U.S. workforce). This is not so much the result of CEOs making a quick buck on outsourcing as a reflection of automation and global competitive pressures.

Our political system has been negligent in helping millions of Americans adapt during a period of rapid economic change. But those on the left and right who promise to reverse the process of globalization are economic charlatans. Their main policy response — tariffs and other forms of protectionism — is a proven path to trade wars and global recession, which hurt the vulnerable most. 

Conservative economics offers three positive alternatives: Provide a growth-oriented economic environment (including opportunities to sell overseas). Give workers the education and skills to succeed in a modern economy. And subsidize the wages of lower-skilled jobs to provide a decent living. 

Who are the obstacles in pursuing such policies? On the latter two, they are not globalized elites; they are more likely to be conservative ideologues. Thirty American CEOs at Davos would come up with several ideas to improve, say, educational standards. Thirty members of the House Freedom Caucus would oppose all of them on principle. In fact, conservative populists are now working along with education unions to undermine rigorous education standards, apparently on the theory that educational failure is acceptable so long as local officials do the failing. 

The response to these economic arguments from populists is usually ad hominem: Of course an elitist would say something like that. Which is particularly annoying coming from conservative elites, who are embracing the cheapest form of populism, involving no intellectual energy, no policy innovation and no actual help for those in need. The poor deserve better tribunes.

Gerson has a point.  Driving home yesterday I heard a portion of a Trump "speech" and it was all generalities aimed at exciting his followers with no on single specific policy proposal.  Just a blame game and selling himself as a strongman/dictator who would make things "change."

Trumpism is a Politics of Loss and Revenge

A piece in Talking Points Memo looks again at the issue of whether Trump's rise is driven by economic decline and marginalization due to globalization, etc., or racism.  As the piece concludes, racism and perceived loss of white privilege is the real driving force.  The irony, however, is that it is those with the least exposure to immigrants and those they deem "other" who are most loyal to Trump's toxic scapegoating of basically anyone who is non-white.   Here are some column highlights:

I wanted to return to what is certainly the stupidest and yet also one of the most important debates of the 2016 cycle: Trumpers, angry racists or economically stressed victims of globalization? By calling it the stupidest debate I don't mean to insult anyone. I've participated in it to some degree and I generally place myself on one side of it. But like any debate which seeks to make a fixed ideological orthodoxy over whether the chicken preceded the egg or vice versa, it can't help but degenerate into something semantic, embattled and ultimately stupid. In any case, it is still a critical question since Trumpism is a hugely significant development in contemporary US politics. So we need to understand what it is, where it comes from and where it's going.

I want to start with this massive study of Gallup data by Gallup's Jonathan Rothwell which attempted and went a long way toward furthering our understand of Trumpism. For many the big takeaway was that the study had debunked the 'economic anxiety' theory because after controlling for race, education and other factors, it wasn't the most economically marginal who supported Trump. Indeed, greater affluence among non-college whites was positively correlated with supporting Trump. Ergo, no more economic anxiety explanation.

I tend to come down on seeing Trumpism more through a racial prism. But seeing the above evidence as ruling out 'economic anxiety' is a naive way of thinking about how societies and social groups work.

In any case, I don't want to go too far down the rabbit hole of seeing Trumpers as modern day revolutionaries. My point is that this kind of crude reductionism, on either side of the debate, proves very little. We don't simply respond to our own personal experiences but the collective experience of communities we identify with.

Two data points from the study seem much more telling to me. First, Trump support is highly correlated with areas experiencing rising mortality rates for whites - a massively important societal development, in addition to a tragedy for the many people affected. When that revelation was hot at the end of last year, some of the follow up debunking showed that a closer analysis of the data showed that the highest mortality spikes were among middle-aged white women. Critics said, well the angry Trumpers are mostly men, not women. So this argument falls apart. Once again, these correlations aren't that simple or linear.

The second, relatively little discussed, finding is that the people who are responding most to the anti-immigrant, anti-refugee politics are those most isolated from both groups. In other words, the people responding most to anti-immigration politics and xenophobia are ones living in fairly racially homogenous and white communities.

I don't want to attempt some grand overarching theory of Trumpism. But, broad brush, I continue to believe that it is best understood as a reaction to the erosion of white privilege, supremacy and centrality in American life. 

That brings us to the second key point: Trumpism is about loss. And that loss is real. It's not just about being haters or uneducated or stupid. The fact that what's being lost is in most respects something that wasn't legitimate to have in the first place - status, centrality and racial privilege - should not blind us to the fact that the loss is real and that it will have political consequences. As I mentioned when I wrote up that mortality study last December, I think this demographic and actuarial marker - an almost unprecedented reversal of a particular group's mortality statistics - is hugely significant to understanding our contemporary politics. It almost unquestionably points to some acute socio-cultural stress. It's just a matter of discovering what it is.

I looked this up when I started looking at the polls showing Hillary Clinton competitive or even in some polls ahead of Donald Trump in Georgia. There's a powerful story here. If you were a 25 year old white man in Georgia in 1980, you lived in a state that was almost literally black and white. And whites were the overwhelming majority of the population. A mere thirty six years later the picture is dramatically different. According to the 2015 US Census estimate, non-Hispanic whites make up only 53.9% of the population. The African-American population makes a up slightly larger percentage of the population - I assume descendants of the early 20th Great Migration returning to the state. The same year Hispanics made up 9.4% of the population, Asian-Americans made up 4% and the remainder is made up of citizens who identified as being of multiple races or 'other'. If you identify politically and culturally with your whiteness this is a profound and profoundly unsettling change.

If you look at the Georgia Republican primary this year, Trump won the overwhelming number of counties. But if you look at the percentages, he did best in counties with the lowest median incomes and those with relatively low percentages of white voters. (Of course, the GOP electorates were overwhelmingly white basically everywhere.)

One of the best and most frequently cited arguments against those who see Trumpism as driven by economic insecurity and globalization is: if that's the case, why does he get basically no support outside of the white community since non-whites are at least as economically stressed as whites and in most cases far more so? The best rebuttal is that if you're pushing a politics about globalization and declining economic opportunity which scapegoats non-whites as the source of the problem, of course you're not going to get a lot of traction with the people your scapegoating.

All true enough. But if you look at the language of Trumpism we see repeated references to getting stuff back, reclamation, anger. This is a politics of loss and grievance. The appeal of an extreme dominance politics is particularly to those who feel they've lost power and who feel increasingly marginal to the direction of the country as a whole. There's a strong theme of Trumpite rhetoric that is about revenge. Put that all together and I think the driving factor is the erosion of white dominance in American life. African-Americans, Hispanics and other rising racial and ethnic minority groups may have grievances or demands for greater inclusion, dignity and respect in American life. But pretty much by definition they're not looking to reclaim something that was taken from them or something they've lost. It is inherently future oriented in a way that this burgeoning white nationalism is not.

It makes perfect sense that this sense of loss and griavance would be felt most acutely by those lowest on the economic and education scale. But go back to what I said about Trump getting his biggest support with people with least contact with the country's new immigrant. If you're more affluent, consider yourself among those succeeding in contemporary America or live in one of the areas that is already defined by the more racially and ethnically diverse America that will define the 21st century, I think you're less likely to politically identify with your whiteness and the loss one inevitably experiences if that is a primary identification. It's hardly like economically vital and diverse major metropolitan areas are filled non stop post-racial Kumbayas. But if that's the world you live in, I suspect you tend to see Trumpism as if not offensive than simply an anachronism. This is almost certainly why Trumpism has virtually no purchase among the young. The numbers are actually quite astounding. A recent McClatchy poll showed Trump running 4th - behind Gary Johnson a nd Jill Stein - among voter 18 to 29 years of age. Jill Stein was at 16% and Trump was at 9%.

Of course, under 30 voters are considerably more diverse, less white, than the electorate as a whole. But they're not that diverse. Even among young white men, Trumpism seems to have very little traction. Trumpism is a politics of loss, nostalgia and grievance for a past these young voters have no experience of. It's driven by attitudes they find offensive or alien.

Trump Fuels Resistance of Whites in Decline

With Donald Trump's strongest support coming from working class white males with a high school education or less, it quickly becomes obvious that Trump is preying on these citizens who have lost out to the forces of globalization and the growing requirement of a college degree for meaningful long term employment.  Hence Trump's targeting of immigrants, minorities and non-Christians who are easy targets of the angst and hatred that are the core of Trump's base.   Make no mistake, by "Make America Great Again," Trump means the reinstatement of unchallenged white privilege.   A lengthy piece in the New York Times looks at Trump's pandering to these voters and the manner in which he has mainstreamed hate and bigotry and won the cheers of white supremacist organizations.  Here are article highlights which I find very disturbing.  Here are article excerpts:

In countless collisions of color and creed, Donald J. Trump’s name evokes an easily understood message of racial hostility. Defying modern conventions of political civility and language, Mr. Trump has breached the boundaries that have long constrained Americans’ public discussion of race.

Mr. Trump has attacked Mexicans as criminals. He has called for a ban on Muslim immigrants. He has wondered aloud why the United States is not “letting people in from Europe.”

His rallies vibrate with grievances that might otherwise be expressed in private: about “political correctness,” about the ranch house down the street overcrowded with day laborers, and about who is really to blame for the death of a black teenager in Ferguson, Mo. In a country where the wealthiest and most influential citizens are still mostly white, Mr. Trump is voicing the bewilderment and anger of whites who do not feel at all powerful or privileged.

But in doing so, Mr. Trump has also opened the door to assertions of white identity and resentment in a way not seen so broadly in American culture in over half a century, according to those who track patterns of racial tension and antagonism in American life.

On the internet, Mr. Trump is invoked by anonymous followers brandishing stark expressions of hate and anti-Semitism, surprisingly amplified this month when Mr. Trump tweeted a graphic depicting Hillary Clinton’s face with piles of cash and a six-pointed star that many viewed as a Star of David.

“I think what we really find troubling is the mainstreaming of these really offensive ideas,” said Jonathan Greenblatt, the national director of the Anti-Defamation League, which tracks hate groups. “It’s allowed some of the worst ideas into the public conversation in ways we haven’t seen anything like in recent memory.”

The resentment among whites feels both old and distinctly of this moment. It is shaped by the reality of demographic change, by a decade and a half of war in the Middle East, and by unease with the newly confident and confrontational activism of young blacks furious over police violence. It is mingled with patriotism, pride, fear and a sense that an America without them at its center is not really America anymore.

In making the explicit assertion of white identity and grievance more widespread, Mr. Trump has galvanized the otherwise marginal world of avowed white nationalists and self-described “race realists.” They hail him as a fellow traveler who has driven millions of white Americans toward an intuitive embrace of their ideals: that race should matter as much to white people as it does to everyone else. He has freed Americans, those activists say, to say what they really believe.

Demographers began to speak of a not-too-distant future when non-Hispanic whites would be a minority of the American population. In states like Texas and California, and in hundreds of cities and counties around the country, that future has arrived.  It is the changes that are taking place that have created the national constituency for Donald Trump,” Mr. Buchanan said.

For many Americans, President Obama’s election, made possible in part by the rising strength of nonwhite voters, signaled a transcendent moment in the country’s knotty racial history. But for some whites, the election of the country’s first black president was also a powerful symbol of their declining pre-eminence in American society.

Few politicians were better prepared than Mr. Trump to harness these shifts. While open racism against blacks remains among the most powerful taboos in American politics, Americans feel more free expressing worries about illegal immigrants and dislike of Islam, survey research shows. In Mr. Trump’s hands, the two ideas merged: During Mr. Obama’s presidency, he has become America’s most prominent “birther,” loudly questioning Mr. Obama’s American citizenship and suggesting he could be Muslim.

In June 2015, two weeks after Mr. Trump entered the presidential race, he received an endorsement that would end most campaigns: The Daily Stormer embraced his candidacy.

Founded in 2013 by a 32-year-old neo-Nazi named Andrew Anglin, The Daily Stormer is among the most prominent online gathering places for white nationalists and anti-Semites, with sections devoted to “The Jewish Problem” and “Race War.” Mr. Anglin explained that although he had some disagreements with him, Mr. Trump was the only candidate willing to speak the truth about Mexicans. . . . across this spectrum, in Mr. Trump’s descriptions of immigrants as vectors of disease, violent crime and social decay, they heard their own dialect.

Mr. Taylor, who has written that blacks “left entirely to their own devices” are incapable of civilization, and whose magazine, American Renaissance, once published an essay arguing that blacks were genetically more prone to crime, wrote on his blog that Mr. Trump had handled the attacks on him “in the nicest way.”

[O]n the flatlands of social media, the border between Mr. Trump and white supremacists easily blurs. He has retweeted supportive messages from racist or nationalist Twitter accounts to his nine million followers. Last fall, he retweeted a graphic with fictitious crime statistics claiming that 81 percent of white homicide victims in 2015 were killed by blacks. (No such statistic was available for 2015 at the time; the actual figure for 2014 was 15 percent, according to the F.B.I.)

In January and February he retweeted messages from a user with the handle @WhiteGenocideTM, whose profile picture is of George Lincoln Rockwell, the founder of the American Nazi Party. A couple of days later, in quick succession, he retweeted two more accounts featuring white nationalist or Nazi themes.

In fact, Mr. Trump’s Twitter presence is tightly interwoven with hordes of mostly anonymous accounts trafficking in racist and anti-Semitic attacks. 

All of which makes me re-post this image in challenge to Trump supporters: