Maureen Dowd brings it all back

Once in a while, without a hand from outside "fact-checkers" or partisan "attack machines," the best journalists in the mainstream media light up the sky and show us what is at stake.

With one column, and its ghastly aftermath, Maureen Dowd reintroduces us to the people Mitt Romney would bring back to the White House—the warrior intellectuals of the Bush years. Her New York Times column Neocons Slither Back, and the next morning’s Politico summary of their outraged responses, should be read together.

Alone, Dowd’s column is merely a workmanlike reminder that Mitt Romney and Paul Ryan rely on the same neocons George Bush used to intellectualize about shaping events around the world with US armed forces. It contained two rather unoriginal insults: suggesting that Paul Ryan relies on the words of his campaign manager, Dan Senor, a right-wing flack with a world view, and repeating Paul Wolfowitz’s concern that Obama should not be allowed to “slither” back into office without a clear position on Libya.

By next morning, five neocons were already on record accusing the outrageous Maureen Dowd of being a creepy, hate-mongering, and lazy peddler of anti-Semitic imagery. Apparently "slither" has Jewish copyright. It can be used by Jewish American hawks when questioning the "moral clarity" of a Kenyan-friendly president, but can’t even be repeated by an insolent Catholic feminist in the New York Times.

The accusation that Dowd was reviving a vile ancient stereotype about doltish gentile politicians being manipulated by “clever and snake-like Jews” is laughably self- aggrandizing, ineffectual, and uncivil. It tells us, however, that the neocons have lost none of their edge, that their menace is as fresh as a fall north wind.

Maureen Dowd is too smart to think and too good a writer to imply that Dick Cheney, Donald Rumsfeld, and George Bush were stupid, innocent puppets of the neocons. She was simply reminding us that the staff a president assembles reflects on the character of the president, and doesn’t diminish his power.

This incident, however, does say quite a lot about the caliber of the public intellectuals Romney and Ryan are presently indulging. They misjudged the Middle East over the last decade and misjudge their detractors at home today.

Accusing someone of being anti-Semitic is going nuclear. It’s the polemist’s application of “shock and awe.” It’s designed to cower weaklings. Dowd, however, is still at it.

Left and right should back the Euro

Escapists chase very different utopias and still end up in hell.

Extreme left and extreme right voices in Europe imagine relief by imagining that the European market—and its cornerstone, the Euro—was misconceived. It’s seen as a straight jacket by the so-called Keynesian left and as a helicopter parent by neo-conservatives.

Nationalist contempt for big federations is logical. Chauvinists exist in provinces, states, and national capitals on both sides of the Atlantic. What they want and what they’ve championed over the last century, fortunately, are understood as well.

In the clutch, the left can be counted on to oppose what the nationalists want. The left believes in the welfare state and activist government but is not naïve about borders or trade barriers per se. Nationalism, they know, invariably rewards privilege and is paid for by the less powerful.  

The muffled amusement of neo-conservatives toward the perilous state of the Euro-zone, however, is logically indefensible. Their renewal of the case for market liberalism has been vital in breaking down economic barriers globally and has supplied much of the policy agenda of the European Union and its moderate left and conservative member states.

All too readily, however, they fall back on a uniquely Anglo skepticism toward federations. They too readily see federal systems as incompetent rather than irreplaceable guardians of open markets. Andrew Coyne of the National Post is uncompromising about the flawed Euro-zone:

“There is little doubt that, as currently constituted, it has proved a disaster, making half of Europe uncompetitive and forcing the other half to bail it out. It was an attempt, as we can now see, to stretch a single currency over countries with very different economies and, more important, very different political cultures. That would have been a problem even if the common monetary authority had been backed by a common fiscal authority, as elementary theory would suggest it should have been. But with every country off borrowing as much as it liked, in defiance of their obligations under the Maastricht treaty, the project was ripe for catastrophe long before the crisis exposed its weakness.

Click on: http://fullcomment.nationalpost.com/2012/05/07/andrew-coyne-frances-vote-against-austerity-is-like-a-vote-to-outlaw-bad-weather/

Setting aside nearly 240 years in the US and 142 years in Canada of regularly falling short of “elementary theory,” our North American federations have operated rather well with two rather over-reaching currencies and often reckless state and national governments.

Texans haven’t asked specifically to bail out Californians or vice a versa. Rednecks in Alberta haven’t been asked to subsidize French Canadians or Tory snobs in Halifax. However, all of them have been electing national governments that cushion hardship in other communities, and ameliorate economic shocks and foolish mistakes half a continent away.

The proposition that the Europe Union is just too divided economically and culturally isn’t reasonable, either. Americans are at least as divided as Europeans on hot button issues. Until this week, in fact, polarization and gridlock were seen as unique and fascinating American vices.

Furthermore, as a basic measure of economic disparity—income inequality—these two great federations are almost the same. After reviewing personal income and national data, Jim Manzi points out in the National Review:

“It turns out that America and Europe as a whole have extremely similar levels of economic inequality—Europe’s is just chunked by country.”

Click on: www.nationalreview.com/corner/290260/america-really-more-unequal-europe-jim-manzi#

Europe should ultimately be able to make its common currency work. If it needs more time to regain its confidence, however, its neo-cons should at least make the case that the alternatives—the economic nationalisms of the past—were truly disastrous.

Just imagine: A US election-year deal with Iran

In 1980, Democrat Jimmy Carter was humiliated by an extremist Iranian government and, consequently, thrown out of the presidency by a righteous Republican. Imagine the impact on US politics if Democrat Barack Obama, with his European allies, now reaches an agreement with Iran that allows for the peaceful development of nuclear power in Iran, comprehensive inspection, and the lifting of Western economic sanctions. 

Richard Nixon could go to China; after all, it was a Democrat who “lost” China in the first place. But can Obama make peace with Iran? Must America, after 32 years, continue to wait for a new generation of Republican neo-cons to finish the job?

Robert Wright, Pulitzer prize–winning senior editor at The Atlantic notes that the conservative Washington Times is already insisting that Obama stand down and let things continue to fester. In “The Iran Hawks’ Latest Misleading Meme,” Wright predicts:  

“In this mission the Times will be joined by many allies on the right. So prepare yourself for warnings about how Iran is getting "the upper hand," as the Times put it, in the negotiations. If a deal starts to look likely, we may hear that Iran is "thumbing its nose" at us or that America is "capitulating" or "abjectly submitting" to Iranian demands. And let's not forget those hardy perennials, "Munich" and "appeasement."

Click on: www.theatlantic.com/international/archive/2012/04/the-iran-hawks-latest-misleading-meme/256048/

There’re few blessings ever for the peacemaker.

A credible deal, however, would carry one crass consolation for the president: Newt Gingrich and Mitt Romney wouldn’t call it honorable, but they’d have little left to say about souring oil prices.

A conservative re-opens the idea of continental integration

The Canada-US border—one of the world’s most un-economic political inventions—has been effectively untouched by the extensive efforts of conservatives to restore the vitality and influence of markets in North America. They are governing in Ottawa today and have dominated US economic policy since Jimmy Carter. In both capitals, however, vainglorious nationalists keep the border safe.

Right wingers in both countries stand for secure borders and emotional nationalism. In the US, they beat their chests for American exceptionalism. Canadian conservatives keep their distance from American conservatives by talking about making Canada a superpower as well.

The border status quo persists; a minor deal between Harper and Obama is accepted as “good progress” by business and conservative voices in both countries. The old patriot game carries on: US politicians look out for Mexican “illegals” and Canadian politicians, including Harper, threatening to exercise their options in Asia.

One well-read Canadian conservative, finally, is sounding restive. Brian Lee Crowley, managing director of the Macdonald-Laurier Institute, an Ottawa-based think-tank, pointed out recently that the Canada-US relationship isn’t just about trade but also about running a “single integrated economy.”

“. . . NAFTA is not (despite its name) chiefly about trading finished goods between separate national economies. It is about managing a highly integrated continental economy in which Canadians and Americans work together to make things. NAFTA should really be called the North American Integrated Production Agreement (NAIPA).

“Canadians and Americans do not trade with each other as the French and the Japanese do. We make things together and then sell them to each other and the rest of the world. That is why, for example, about two-fifths of the vast “trade” between our two countries takes place within individual companies. They move goods from one plant to another at different stages of production, and those plants are spread about in both Canada and the United States.”

Click on: http://opinion.financialpost.com/2011/12/13/it-isnt-about-trade/

Then, he goes on to identify the fundamental tension between us:

“Politicians respond only to national voters, and so live in a closed political system. Alas, that closed polity is superimposed on an open economy. Government policies that result cannot truly encompass the interests of North Americans, but only of Americans and Canadians separately. Hence we get border thickening in the post-9/11 world and post-recession protectionism in the United States. Canadians’ vulnerability is that we live in another country, but not another economy.

“National policy mismatches inevitably show up at the border. An inefficient border is an annoyance in a trading bloc. But in a production bloc, it is disastrous.”

While the Beyond the Border agreement between Obama and Harper points in the right direction, Crawley concludes that we can do better:

“In thinking about what comes “after NAFTA” we must be capable of the effort of imagination to create institutions that can overcome the political divisions that scar our economic efforts while preserving our national sovereignty.”  

Crawley could have gone much further. We should be better integrating business and professional services, human resources, and investment capital, as well as the production of goods. Further, there are several big time-tested institutions already available to better integrate our economies: a common currency, a common labor market, a common security pact that would eliminate the border all together, for instance. Courage, not imagination, is our problem.

However, Crawley has ended this year—for this blogger—on a promising note.

He has re-introduced the explosive word “integration” to Canadians and has acknowledged that the politics of two national democracies—not just two bureaucracies—divide us. This is an important, potentially disruptive step for the manager of a Canadian think-tank.

The left’s take on the era of pro-market downsizing

Along with multimillion-dollar bonuses, intellectuals too are undermining the case for liberalizing markets and limiting government that was so influential over the last thirty years. Left intellectuals have much further to go before they can restore the idea that government should be the lead change agent. They are, however, doing quite well in asserting the idea that democracy and the people were ripped off. 

It’s appropriate that this counter-reformation is well-represented in Britain. Pro-market reforms started in Britain at about the same time they were launched in the US. But in Britain, they went much further. Last November, the Times Literary Supplement reviewed a book that may become the prevailing diagnosis of what was tried by the right and must be undone by the left. Alasdair Roberts’ new book, The Logic of Discipline: Global Capitalism and the Architecture of Government, argues eloquently that the reforms undertaken during the “era of liberalization” were designed to insulate key state functions from the “caprice and short-sightedness of the democratic process.” The reviewer, Jonathan Pearson, sums up Roberts’ thesis:

“In short, in order to protect the fledgling globalized economy, undisciplined voters and politicians were to be sidelined in favour of disciplined technocrats. The “logic of discipline,” as Roberts calls it, inspired the creation of an array of defences against the “vagaries” of democracy. Discipline found its institutional expression in the creation of independent central banks, independent regulatory agencies, the transfer of authority from governments to private industry and the emergence of fiscal rules designed to ‘restrain the sovereignty of democratic institutions.’”

As a participant in design of an independent regulatory and commercial structure for Ontario’s gigantic public electricity system, my heart races when I read again about the importance of discipline. However, the above thesis is wrong on three points. It doesn’t say for whom discipline was intended to benefit, how discipline was to be realized, and it makes democracy the adversary.

Investment bankers made a lot of money out of privatizations. But the idea of devolving numerous government businesses to the private sector would not have gone very far, anywhere, without aggressive support within both partisan and nonpartisan circles in government. Concern for discipline was paramount — but the culprit was hardly democracy. According to the review, “the world of discipline is staunchly amoral; here objectivity and efficiency always trump fickle notions of ‘right and wrong.’” Try selling that idea to a minister of any strip.

The discipline reformers we were looking for was to be found in competitive markets, and the beneficiaries were intended to be the people. Alfred Kahn, the American air industry deregulator, put it succinctly: “Whenever competition is feasible it is, for all its imperfections, superior to regulation as a means of serving the public interest.”

Public concerns—for instance, worker safety, fair dealing in the marketplace, the social safety net, and the environment—were never targets for privatization or deregulation. No matter what transcendent virtues entrenched interests used to clothe themselves, the reform aims were clear: if it can be made, bought, and sold in markets, then it is best that it operates in markets and not remain the ongoing business of public monopolies.

Yes, discipline—rigorous external threats and interests—is vital. Institutions that don’t have to account to others lose their way, don’t adapt, and waste resources. It is still theoretically conceivable that the old socialist ideal that community decision-making can serve both justice and economic efficiency. However, we know from experience that massive public monopolies operating in big democracies cannot be as effectively disciplined within the modern state as they can in competitive markets.

Alfred E Kahn: a visionary market advocate and not a conservative

Last December, at his home in Ithaca, New York, Alfred E Kahn died at 93. He was one of the most important economic policy reformers since the New Deal democrats went to Washington in the 1930s. Since his passing, his accomplishments have been widely noted, especially his leadership in deregulating American Airlines. The New York Times published one such positive summary.

“Mr. Kahn, a leading regulatory scholar who wielded his influence in both government and academia, helped spur a broad movement beginning in the mid-1970s toward freer markets in rail and automotive transportation, telecommunications, utilities and the securities markets. Before deregulation, the airlines were tightly controlled by the Civil Aeronautics Board, which approved routes and set fares that guaranteed airlines a 12 percent return on flights that were 55 percent full.

The changes Mr. Kahn orchestrated resulted in increased competition, lower fares and the rise of low-cost carriers like JetBlue and Southwest. But they also created severe financial problems for the industry, leading to bankruptcies and mergers.

‘I have to concede that the competition that deregulation brought certainly was terribly, terribly hard on the airlines and their unions, who had heretofore enjoyed the benefits of protection from competition under regulation,’ Mr. Kahn said decades later.”

Click on: http://www.nytimes.com/2010/12/29/business/29kahn.html?_r=1&ref=alfredekahn

His public career and public accomplishments cast an ironic light on contemporary American politics and the divisive clichés of our time.

The so-called “Reagan revolution,” the “neo-con” think tanks, and the “Washington consensus” that championed market-based economic reforms over most of the last three decades actually followed Alfred Kahn’s leadership. They didn’t add much intellectually; they tried to flesh out his vision. And, all the while, he was a liberal.

Alfred Kahn and President Carter weren’t bullied into radical regulatory reform by Republican intellectuals or vested interests. They didn’t have to “triangulate” with backlash conservatives.

Khan’s critique of the aging New Deal vision of government was more positive than President Clinton’s later concession that, yes, government can get too big. If Kahn was in Washington today, he would likely be called an economist with bipartisan tendencies. However, he was far more ambitious than that. He was motivated by a set of liberal market values that don’t merely stand between the extremes of left and right.

The liberal vision that once largely thrived at the center of US politics —that wherever possible governments should protect and nurture competition and rely on consumer choice to drive efficiency and innovation—was shouldered out by the catastrophes of the 1930s and the Cold War. However, by the 1970s, the federal government’s take-charge response to economic developments had become too reflexive and too often a generator of privilege rather than national progress. A liberal response to the unnecessary excesses of the interventionist state (that liberals had built) was awkward but inevitable.

The restoration of traditional liberalism (or what’s now called neo-liberalism) by reform Democrats, of course, was quickly interrupted by the election of Ronald Reagan in 1980. Nevertheless, Reagan didn’t change course. He made it look easier.

The free market bias of Alfred Kahn and the neo-liberals is intact; its agenda in energy, transportation, agriculture, trade, and education is unfinished and still controversial.

Those who insist on seeing history as one story after another like to identify “eras” with one dominant idea. From 1980 to the financial collapse of 2008, the free market ideologues were said to be in charge. And now they’re out. Well, nothing original started or was settled with Reagan—and it’s very unlikely that Alfred Kahn would say that for the last three decades markets consistently beat entrenched interests and those who still think only government can be trusted to deliver.

Instead of demonizing deregulation as a right-wing conspiracy, Democrats and Liberals elsewhere would be more useful and credible if they took up its essential liberal rationale.