Of all the politicians currently seeking the Republican nomination for president, Mitt Romney is the one who I've come think of as the candidate who is most likely to both win the nomination yet proceed to lose against Barack Obama in the general election. His deep pockets, strong organization, and high recognition among voters let him hit the ground running -- he has been the frontrunner for the Republican nomination from day one. Although recent entrant Rick Perry has been leading Romney in the latest few polls, the newest kid on the block often polls well...the Texas governor will need some strong debate performances to maintain this momentum. If he doesn't, I think it's likely the polling will put Mitt right back on top again; after all, that's where he's been in most of the polls conducted over the past couple of years. Indeed, I have no problem imagining Romney beating Perry or Bachmann or Paul; it is his chances against President Obama that I wonder most about.
With the president's approval ratings continuing to weaken and the economy mired in a state of ugly stagnancy, Obama ought to be the type of opponent that Republican candidates would want to face head-to-head in a general election. That they likely don't relish this matchup against the incumbent more has much to do with Obama's Romney-like qualities: he's a smooth speaker, incredibly well-funded, and supported by an extremely strong campaign organization carried over from 2008. Obama and Romney have something else in common, of course: both were executives who became associated with health care reform plans that instituted individual mandates requiring the uninsured to purchase health insurance in order to avoid fines. Obama as president signed 2010's Affordable Care Act into law which remains his major legislative achievement thus far into his first term. In 2006, Romney as governor of Massachusetts signed an Act Providing Access to Affordable, Quality, Accountable Health Care. While Romney publicly opposes the ACA, he has not repudiated the Massachusetts bill, arguing instead that it was the right solution in Massachusetts though it wouldn't necessarily be a good fit for other states. While this point of view may appeal to states' rights supporters, Romney has essentially been forced to defend the concept of the individual mandate which is probably the most disliked aspect of both Obamacare and Romneycare. While the other Republican candidates have the rhetorical room to attack the individual mandate as an affront to personal liberty, Romney is now too linked with the individual mandate to criticize it too deeply. For all his stated dislike for Obamacare, Governor Romney is philosophically defending an important aspect of the legislation whenever he argues the individual mandate was necessary and helpful in Massachusetts. Obama's first term has not brought major change apart from health care reform -- I have no doubt that a President Romney would have sought to extend the Bush tax cuts, reform the financial sector in some way as a response to the mortgage crisis, and find Osama Bin Laden, for instance. Romney's inability to effectively attack Obama on health care seems incredibly damaging to his general election prospects given that the president has not really gotten all that much done in his first term.
This line of thinking is so convincing to me that I have to admit I've wondered from time to time why Mitt Romney is even bothering to run in 2012. Despite his popularity, he seems like exactly the wrong candidate at the wrong time -- he'd seemingly be in a stronger position running in 2016 or 2020 when Obamacare will probably not be such a volatile campaign issue, particularly if he continues to age well. Watching Mitt's early debate performances, however, has given me a different understanding of his campaign strategy and made me realize he may not be such a pushover in a general election after all. As the frontrunner, he has had the luxury of not having to attack his fellow Republicans. Instead, he has squarely focused on the economy -- he is trying to be the type of business, employment, and growth-friendly candidate that Barack Obama cannot be because the economy has been so bad during the Obama presidency. While other Republican candidates have gained much media attention for making controversial statements (Michele Bachmann and Herman Cain in particular), Romney has been better able to control his message which happens to be tailor-made for an underemployed, financially stressed electorate. He wants to appear safe and nonthreatening -- he wants people to be able to "Vote for Romney, vote for jobs!" even if they have some philosophical differences with the Republican Party or even if they think Barack Obama wasn't such a bad president apart from his economic policy or lack thereof (they might even LIKE the ACA!). While Romney may be forced to be much more aggressive in the next few debates due to the Perry surge, his measured campaign so far has clearly been tailored more towards moderates and not to strong conservatives. In a general election, there are several factions in the Republican party who may not turn out to vote for Romney in large numbers -- however, he may actually be able to steal some former Obama voters who are deeply worried about the economy. When you consider that the president has also alienated powerful factions in his own party because of his relatively moderate approach to governing, that Romney-Obama matchup doesn't sound like such a foregone conclusion after all. The Romney campaign, however, will outright require a bad economy to succeed (an odious thing to bank on!) -- if the unemployment and growth pictures brighten, Mitt will have a much harder time differentiating himself from President Obama. Even if circumstances do favor Romney, the former governor will face a difficult balancing act between on one hand trying to assuage the fears of conservatives who dislike his record and on the other hand trying to use that same record to attract disaffected Obama supporters who would not normally vote Republican. Perhaps the most interesting thing about a Romney-Obama race is that it would very much be about picking the lesser of two evils for many voters -- both conservatives and liberals could be sorely tempted to vote for a third party candidate or stay home on Election Day since Romney and Obama both have records of disappointing their bases.
Saturday, September 3, 2011
Sunday, April 24, 2011
A Test for Interventionism in Libya
The most agonizing decision an officeholder could have to make must be whether or not to send one's nation to war. When, after all, is there truly a good time to wage war? Warfare can only possibly yield good results when humanity is considered in the aggregate. For the civilians caught in the crossfire, the fallen troops on both sides, and the grieving families who will never see their loved ones again, even the most virtuous war can be disastrous. The idea, then, that war should be waged only when absolutely necessary -- such as when the nation is directly attacked by another country -- is reasonable. The country whose foreign policy is guided by this fundamental idea will not fight petty wars of aggression. At the same time, however, this country will also not fight for "the greater good" and that can be a hard burden to bear in and of itself.
I tend to see America's hypervigilance and aggressive interventionism during and after the Cold War period as a direct result of our experiences in World War II, a war we were very reluctant to enter and ultimately only did enter after suffering a direct attack. Our reluctance, alas, did not spare hundreds of thousands of military lives. There is still a feeling among many people to this day that we were far too reluctant to act, having given the Axis powers precious time to strengthen their positions and consolidate territorial gains and allowing them to perpetrate massive crimes against humanity. Granted, both the government and the public were working from a position of limited information -- the disgusting details of the Holocaust became common knowledge only after the war, for instance. Having viewed the destruction and death of World War II, it was only natural that policymakers should ask themselves, "What can we do to stop this from happening again?" It may seem bizarre that the desire to prevent future madmen from trying to conquer the world or annihilate their own people could in any way lead to the US supporting such things as coups against elected governments in Iran and Guatemala, but fear and an obsession with protecting one's interests at any cost can lead you down some strange paths. Ultimately, I see the excessive interventionism of the Cold War era as resulting from American determination to not allow the Soviets to gain an upper hand as the Nazis did. We certainly saw bogeymen where they probably didn't really exist at times (and compromised our principles in the name of fighting Communism), but at least we were responding to a real threat. If criticism of interventionism has risen in the post Cold War era, I would say it's largely because the policy no longer resonates with much of the public...there may be individual brutal leaders, but there's no Axis (the "Axis of Evil" was merely a list of rogue states, not a true alliance of inimical powers) , no Soviet Union intent on spreading the revolution, and no one trying to conquer the world. The questions of who we are fighting and what we are fighting for have become much more difficult to answer.
This brings us to Libya, the conflict du jour. As a fan of representative government, I've been frankly excited to watch the revolutions in North Africa from afar. I've never really believed that free speech and democracy are only compatible with certain cultures (one explanation offered for the host of dictatorships and monarchies in the Middle East and North Africa) -- rather, I think the desire to have one's voice heard and influence one's society are fundamental aspects of human nature. It's too soon to tell what sort of government the Tunisians and Egyptians will end up with, but they've reminded the world that even corrupt and despotic governments can be called to account by their people. Alas, Colonel Qadaffi in Libya has reminded the world of a more bitter truth: the ruthless and well-armed have a distinct advantage in war. I fully understand why the UN backed intervention in Libya; when Qadaffi threatened to go "house by house" in Benghazi to crush the rebels, the specter of Nazi Germany is what appeared in my mind's eye. Thus, I tend to see Libya as a test: interventionists say that war can prevent bloodshed, genocide, and, ultimately, more war...Libya is another chance to prove it. The wars in Afghanistan and Iraq overthrew brutal governments, but created tremendous instability and led to huge numbers of civilian casualties. Will Libya be any different?
I certainly see a difference in how the United States is approaching Libya as opposed to Iraq. It has studiously so far avoided taking a leadership role in the conflict past the initial stage in which Libya's anti-air capabilities were destroyed; it has appeared to be as much France's or the UK's war as it has America's. This may not last -- America has more military resources than its allies and the more it commits to the operation the more it will be blamed for when things go wrong. The coalition approach was attempted in Iraq as well, but ultimately the US was the driving force behind the war, so much so that it's extremely difficult to imagine that war being waged without US direction and involvement. For a purely "humanitarian war" (which Iraq of course was not...and in practice any successful war will yield certain strategic advantages for the victors, humanitarian or not), I think it's important that multiple countries agree it is the "right" thing to do, the more global consensus there is the better. It's all too easy to decide a war is just when it is in one's own perceived best interests that it be waged. Perhaps the great reluctance of the allies to put ground forces in Libya is also a result of lessons learned in Iraq -- in addition to avoiding military casualties, this policy also places responsibility on the rebels to win the ground war, a significant challenge but one that might help ease perceptions that Westerners are trying to take over Libya.
There is at least one distressing similarity between the actions in Iraq and Libya as well: the hypocrisy of the intervening powers. The "Bush doctrine" of preventive war sounded to me like a recipe for perpetual warfare -- it allowed for war not only against Afghanistan and Iraq but also Iran, North Korea, Syria, and any number of future threats that would emerge. In truth, I doubt President Bush had any interest in taking on an enemy with the military capabilities of a North Korea. This makes one wonder, then, if it's safe to engage in dialogue with a bigger threat like North Korea, why is there any imperative to do battle with a weaker threat like Iraq? There is perhaps even worse hypocrisy coming from those who advocate humanitarian wars. France's close ties with the former Tunisian regime were exposed in the wake of the Tunisian revolution just as America's ties with Mubarak's Egypt were placed under the microscope when the Egyptian people rose up. When France and the US can have friendly relationships with dictatorial regimes when it is convenient and fight them in other circumstances, it's hard to discern any firm ideological framework for conducting "just wars." Syria and Bahrain are killing protesters as the world watches...they don't seem to fear becoming another Libya. Better to do some good than none at all, surely, but one has to wonder about the hidden reasons behind any intervention when the choice concerning where to intervene appears arbitrary.
The debate as to whether it is right to intervene or not is perhaps not resolvable; people will always believe different things. The key debate may actually become whether or not the United States and other nations can afford to intervene. The US, UK, and France are all seriously indebted nations. The US is facing a political debate regarding raising the debt ceiling so it can continue to borrow. The UK is currently undergoing austerity measures to get its fiscal house in order. France recently raised the retirement age to protect its pension system. All three nations (and, indeed, all nations) limit their domestic spending in order to pay for their militaries, diplomats, and intelligence agencies. It seems doubtful that this course is sustainable indefinitely.
I tend to see America's hypervigilance and aggressive interventionism during and after the Cold War period as a direct result of our experiences in World War II, a war we were very reluctant to enter and ultimately only did enter after suffering a direct attack. Our reluctance, alas, did not spare hundreds of thousands of military lives. There is still a feeling among many people to this day that we were far too reluctant to act, having given the Axis powers precious time to strengthen their positions and consolidate territorial gains and allowing them to perpetrate massive crimes against humanity. Granted, both the government and the public were working from a position of limited information -- the disgusting details of the Holocaust became common knowledge only after the war, for instance. Having viewed the destruction and death of World War II, it was only natural that policymakers should ask themselves, "What can we do to stop this from happening again?" It may seem bizarre that the desire to prevent future madmen from trying to conquer the world or annihilate their own people could in any way lead to the US supporting such things as coups against elected governments in Iran and Guatemala, but fear and an obsession with protecting one's interests at any cost can lead you down some strange paths. Ultimately, I see the excessive interventionism of the Cold War era as resulting from American determination to not allow the Soviets to gain an upper hand as the Nazis did. We certainly saw bogeymen where they probably didn't really exist at times (and compromised our principles in the name of fighting Communism), but at least we were responding to a real threat. If criticism of interventionism has risen in the post Cold War era, I would say it's largely because the policy no longer resonates with much of the public...there may be individual brutal leaders, but there's no Axis (the "Axis of Evil" was merely a list of rogue states, not a true alliance of inimical powers) , no Soviet Union intent on spreading the revolution, and no one trying to conquer the world. The questions of who we are fighting and what we are fighting for have become much more difficult to answer.
This brings us to Libya, the conflict du jour. As a fan of representative government, I've been frankly excited to watch the revolutions in North Africa from afar. I've never really believed that free speech and democracy are only compatible with certain cultures (one explanation offered for the host of dictatorships and monarchies in the Middle East and North Africa) -- rather, I think the desire to have one's voice heard and influence one's society are fundamental aspects of human nature. It's too soon to tell what sort of government the Tunisians and Egyptians will end up with, but they've reminded the world that even corrupt and despotic governments can be called to account by their people. Alas, Colonel Qadaffi in Libya has reminded the world of a more bitter truth: the ruthless and well-armed have a distinct advantage in war. I fully understand why the UN backed intervention in Libya; when Qadaffi threatened to go "house by house" in Benghazi to crush the rebels, the specter of Nazi Germany is what appeared in my mind's eye. Thus, I tend to see Libya as a test: interventionists say that war can prevent bloodshed, genocide, and, ultimately, more war...Libya is another chance to prove it. The wars in Afghanistan and Iraq overthrew brutal governments, but created tremendous instability and led to huge numbers of civilian casualties. Will Libya be any different?
I certainly see a difference in how the United States is approaching Libya as opposed to Iraq. It has studiously so far avoided taking a leadership role in the conflict past the initial stage in which Libya's anti-air capabilities were destroyed; it has appeared to be as much France's or the UK's war as it has America's. This may not last -- America has more military resources than its allies and the more it commits to the operation the more it will be blamed for when things go wrong. The coalition approach was attempted in Iraq as well, but ultimately the US was the driving force behind the war, so much so that it's extremely difficult to imagine that war being waged without US direction and involvement. For a purely "humanitarian war" (which Iraq of course was not...and in practice any successful war will yield certain strategic advantages for the victors, humanitarian or not), I think it's important that multiple countries agree it is the "right" thing to do, the more global consensus there is the better. It's all too easy to decide a war is just when it is in one's own perceived best interests that it be waged. Perhaps the great reluctance of the allies to put ground forces in Libya is also a result of lessons learned in Iraq -- in addition to avoiding military casualties, this policy also places responsibility on the rebels to win the ground war, a significant challenge but one that might help ease perceptions that Westerners are trying to take over Libya.
There is at least one distressing similarity between the actions in Iraq and Libya as well: the hypocrisy of the intervening powers. The "Bush doctrine" of preventive war sounded to me like a recipe for perpetual warfare -- it allowed for war not only against Afghanistan and Iraq but also Iran, North Korea, Syria, and any number of future threats that would emerge. In truth, I doubt President Bush had any interest in taking on an enemy with the military capabilities of a North Korea. This makes one wonder, then, if it's safe to engage in dialogue with a bigger threat like North Korea, why is there any imperative to do battle with a weaker threat like Iraq? There is perhaps even worse hypocrisy coming from those who advocate humanitarian wars. France's close ties with the former Tunisian regime were exposed in the wake of the Tunisian revolution just as America's ties with Mubarak's Egypt were placed under the microscope when the Egyptian people rose up. When France and the US can have friendly relationships with dictatorial regimes when it is convenient and fight them in other circumstances, it's hard to discern any firm ideological framework for conducting "just wars." Syria and Bahrain are killing protesters as the world watches...they don't seem to fear becoming another Libya. Better to do some good than none at all, surely, but one has to wonder about the hidden reasons behind any intervention when the choice concerning where to intervene appears arbitrary.
The debate as to whether it is right to intervene or not is perhaps not resolvable; people will always believe different things. The key debate may actually become whether or not the United States and other nations can afford to intervene. The US, UK, and France are all seriously indebted nations. The US is facing a political debate regarding raising the debt ceiling so it can continue to borrow. The UK is currently undergoing austerity measures to get its fiscal house in order. France recently raised the retirement age to protect its pension system. All three nations (and, indeed, all nations) limit their domestic spending in order to pay for their militaries, diplomats, and intelligence agencies. It seems doubtful that this course is sustainable indefinitely.
Saturday, April 9, 2011
Are Donald Trump and Sarah Palin in the Same Boat?
On the surface, no two 2012 Republican presidential hopefuls could be more dissimilar than Donald Trump and Sarah Palin. Palin is a former governor and mayor, a former candidate for vice president, a political commentator, and the honorary chair of one of the more influential political action committees of the 2010 midterm elections, SarahPAC. Trump, by contrast, has never held a political office in his life and his previous flirtations with politics in the past have been as confusing as they have been frequent: he donates to Democrats and Republicans alike, has changed his own political affiliation several times, and even publicly considered seeking the nomination of the Reform Party for president back in 2000. What this unlikely pair do have in common is their status as celebrities. Both are reality TV stars, authors, and in-demand speakers and talk show guests. Although many presidential candidates long to have the kind of name recognition that Palin and Trump have, celebrity status can be a two-edged sword. People may know who Trump and Palin are, but many don't take them seriously due to previous gaffes and well-publicized escapades...they are without a doubt overexposed and their dirty laundry has been aired all over America. It also goes without saying that the personal brands of Trump and Palin would be enhanced by their choosing to run for president; how can the public figure out if Trump and/or Palin are actually running to win or just trying to sell more books and merchandise or set themselves up to host a talk show?
All in all, I think Sarah Palin has the better chance to establish herself as a serious presidential candidate if she does ultimately opt to run in 2012. She has genuine political accomplishments, and she can probably overcome the poor public perception created by her past gaffes simply by avoiding future ones. Indeed, I think a strong performance by Palin in a debate or speech is to an extent magnified because the public always expects her to create a media firestorm with a poorly chosen phrase or two. Her biggest hurdle will be to explain away her decision to suddenly resign as Alaskan governor, especially when she will likely have to face other former governors in the race who didn't "quit on the job." I have serious doubts about whether Palin has the work ethic or even the desire to pursue the presidency at this point -- she's never been a policy wonk and may have discovered she enjoys politics better from the sidelines after all. Even if she is taken seriously as a candidate, Palin will have difficulty making any one issue all her own given that she hasn't managed to do this in the years she's been in the political spotlight. I don't think she can afford to be as cautious a "maverick" as she was in 2008; she'll need to take an energetic approach and get specific about policies she supports since she is no longer new to voters. Indeed, I'd even advise her to court a little controversy...how about adopting a pro-marijuana legalization stance, for instance? Given her past remarks about marijuana being a "minimal problem," that could mark a logical evolution of her views. It won't please some social conservatives -- not even a "leave it to the states" approach would -- but it would definitely differentiate her from the rest of the pack and probably prove an asset in a general election since many legalization advocates are disappointed Democrats.
Donald Trump has the harder road to hoe. He's been more visible than Palin in the past few months as an "unofficial" candidate for president. Despite his utter lack of political experience, he does bring a few things to the table besides name recognition: he's charismatic and an entertaining speaker, a successful businessman who has managed to look failure in the face multiple times and seemingly emerged stronger from it each time, and he is incredibly bold. He's already shown himself willing and able to touch issues no "serious" candidate wants to touch. What other candidate but Trump is talking about raising tariffs on China? Most politicians and economists would consider such a move disastrous even as they themselves decry Chinese currency manipulation, but I think protectionism has long been more popular among the general public than among the elite. There are plenty of people who, like Trump, think a tougher trade policy with China will both create American jobs and force China to ease its currency controls. If Trump keeps the pressure on China, he'll get votes because of it...I have no doubt about that Alas, Trump's boldness is perhaps not always an asset: Trump has also been daring in questioning whether or not Barack Obama was born in the United States and thus whether or not he is actually eligible to be president. This could potentially attract another crowd of voters without a home to Trump's doorstep, but I have a feeling it will turn off a lot more people than it will attract in the long run. Unless Trump can deliver some solid evidence to support the so-called "birther" allegations, he's just peddling a conspiracy theory and unnecessarily angering a lot of people who might not dislike Obama the man but do dislike Obama the president. I think about it this way: if Obama had had two American citizen parents and had spent his whole life in the United States, would Republicans like Obamacare and the stimulus any better? Would they feel more confident about his approach to fiscal issues such as the debt and taxation? If there really is a genuine issue about Obama's citizenship, it's for the courts to handle...presidential candidates should talk politics and there's plenty of policy issues for Republicans to attack Obama on. Then again, perhaps Trump really does know what he's doing: according to a recent poll of the New Hampshire electorate, Trump is running second only to Mitt Romney for the Republican nomination! Polls like that are exactly what conspiracy theories are made out of (could there be a "Trumper" movement to massage poll results in order to get Trump to actually run so that more newspapers will be sold, more ads will be clicked, and more debates will be watched? I have to admit it would make the race more entertaining to follow).
I definitely wouldn't discount the possibility that neither Palin nor Trump will run for president. Trump has already boosted his personal brand without making anything official, and even if he really does want to get into politics he could forgo a run for president and run for something in New York instead, building his credentials for a future presidential run. In truth, perhaps Palin and Trump have something else in common...perhaps neither of them actually want to be politicians! After all, you can be a star and a media sensation without a single person being willing to vote for you. It'll be interesting to see what they both ultimately decide to do.
All in all, I think Sarah Palin has the better chance to establish herself as a serious presidential candidate if she does ultimately opt to run in 2012. She has genuine political accomplishments, and she can probably overcome the poor public perception created by her past gaffes simply by avoiding future ones. Indeed, I think a strong performance by Palin in a debate or speech is to an extent magnified because the public always expects her to create a media firestorm with a poorly chosen phrase or two. Her biggest hurdle will be to explain away her decision to suddenly resign as Alaskan governor, especially when she will likely have to face other former governors in the race who didn't "quit on the job." I have serious doubts about whether Palin has the work ethic or even the desire to pursue the presidency at this point -- she's never been a policy wonk and may have discovered she enjoys politics better from the sidelines after all. Even if she is taken seriously as a candidate, Palin will have difficulty making any one issue all her own given that she hasn't managed to do this in the years she's been in the political spotlight. I don't think she can afford to be as cautious a "maverick" as she was in 2008; she'll need to take an energetic approach and get specific about policies she supports since she is no longer new to voters. Indeed, I'd even advise her to court a little controversy...how about adopting a pro-marijuana legalization stance, for instance? Given her past remarks about marijuana being a "minimal problem," that could mark a logical evolution of her views. It won't please some social conservatives -- not even a "leave it to the states" approach would -- but it would definitely differentiate her from the rest of the pack and probably prove an asset in a general election since many legalization advocates are disappointed Democrats.
Donald Trump has the harder road to hoe. He's been more visible than Palin in the past few months as an "unofficial" candidate for president. Despite his utter lack of political experience, he does bring a few things to the table besides name recognition: he's charismatic and an entertaining speaker, a successful businessman who has managed to look failure in the face multiple times and seemingly emerged stronger from it each time, and he is incredibly bold. He's already shown himself willing and able to touch issues no "serious" candidate wants to touch. What other candidate but Trump is talking about raising tariffs on China? Most politicians and economists would consider such a move disastrous even as they themselves decry Chinese currency manipulation, but I think protectionism has long been more popular among the general public than among the elite. There are plenty of people who, like Trump, think a tougher trade policy with China will both create American jobs and force China to ease its currency controls. If Trump keeps the pressure on China, he'll get votes because of it...I have no doubt about that Alas, Trump's boldness is perhaps not always an asset: Trump has also been daring in questioning whether or not Barack Obama was born in the United States and thus whether or not he is actually eligible to be president. This could potentially attract another crowd of voters without a home to Trump's doorstep, but I have a feeling it will turn off a lot more people than it will attract in the long run. Unless Trump can deliver some solid evidence to support the so-called "birther" allegations, he's just peddling a conspiracy theory and unnecessarily angering a lot of people who might not dislike Obama the man but do dislike Obama the president. I think about it this way: if Obama had had two American citizen parents and had spent his whole life in the United States, would Republicans like Obamacare and the stimulus any better? Would they feel more confident about his approach to fiscal issues such as the debt and taxation? If there really is a genuine issue about Obama's citizenship, it's for the courts to handle...presidential candidates should talk politics and there's plenty of policy issues for Republicans to attack Obama on. Then again, perhaps Trump really does know what he's doing: according to a recent poll of the New Hampshire electorate, Trump is running second only to Mitt Romney for the Republican nomination! Polls like that are exactly what conspiracy theories are made out of (could there be a "Trumper" movement to massage poll results in order to get Trump to actually run so that more newspapers will be sold, more ads will be clicked, and more debates will be watched? I have to admit it would make the race more entertaining to follow).
I definitely wouldn't discount the possibility that neither Palin nor Trump will run for president. Trump has already boosted his personal brand without making anything official, and even if he really does want to get into politics he could forgo a run for president and run for something in New York instead, building his credentials for a future presidential run. In truth, perhaps Palin and Trump have something else in common...perhaps neither of them actually want to be politicians! After all, you can be a star and a media sensation without a single person being willing to vote for you. It'll be interesting to see what they both ultimately decide to do.
Thursday, October 21, 2010
Sore Losers
One interesting aspect of the 2010 midterm elections is that multiple candidates who have bucked the traditional party system are playing important roles in multiple races. Ordinarily, this would be something I'd be delighted about. I like the idea of candidates running as individuals and not attempting to mush their personal ideas to fit with the prevailing ideology of a particular political party. Even though independent candidates rarely win elections, many voters are registered as independents -- I think that's because a lot of them don't feel entirely represented by either the Republicans or Democrats. A lot of people agree more with one party on certain issues and more with the other on certain other issues. An independent candidate of the Ross Perot mold has the freedom to be as idiosyncratic as the voter because he or she has no party to please. Unfortunately, in 2010 a couple of important senatorial candidates are running contrarian campaigns not so much because they rejected the parties but rather because their parties rejected them.
I'm speaking of course of Charlie Crist who is vying for attention from Florida voters with Marco Rubio and Kendrick Meek as well as Lisa Murkowski who is trying to hold on to her Senate seat in Alaska against Joe Miller and Scott McAdams. The two took different paths to get to where they are today: Charlie Crist is running as an independent while Murkowski is trying to be elected via a write-in campaign as a Republican even though Joe Miller is the official Republican nominee. What the two have in common is that both kept running after seeking their party's nomination and failing to receive it. Crist launched his independent campaign in response to polls that showed Rubio the Republican favorite in the primary. Murkowski was even more audacious in that she competed in the Republican party primary to the bitter end and lost to Joe Miller yet still did not end her candidacy.
I won't argue that Crist and Murkowski don't bring anything unique to the table. Both are considered more moderate than their Republican opponents yet more conservative than their Democratic opponents. Had they chosen to leave their parties right from the get-go and run as independents I'd have completely respected their decision to do so and welcomed their attempts to shake things up in this stultifying two party political world. Under the circumstances, though, they both seem like sore losers and utterly untrustworthy to me. It's one thing to say, as Crist does now, that the Republican Party has left him and others of similar views behind -- it's another to seek the Republican nomination only to suddenly discover your independent roots when it becomes apparent you aren't going to be your party's nominee. Both Crist and Murkowski seemed to respect how their party did things right up to the point where they didn't become nominated candidates; that's exactly why I can't respect them. They thought the Republican Party was great...as long as Republican voters made the "right" choice in the primary. Had Crist polled better and Murkowski won her primary, they would never have bumped heads with their party. To me, both Crist and Murkowski seem absolutely desperate to gain power, and their candidacies seem an almost pure reflection of their personal ambition. I don't support "sore loser" laws which try to legally prevent independent candidacies from primary losers, but at the same time I don't support "sore losers"...I just don't see how you could ever trust a candidate who wants to win that badly.
Nonetheless, Murkowski and Crist are picking up votes according to the polls. Indeed, both are currently running close to their Republican rivals and beating the Democrats in their races. In Alaska, that perhaps reflects the difficult position the Democratic Party currently occupies in that state. In Florida, Crist's success seems to have come partly on the back of the Democratic nominee Kendrick Meek who has lost support from members of his own party. I find it rather puzzling that there are Democrats who would have voted for Meek over Charlie Crist had Crist been the Republican nominee yet are willing to vote for Crist over Meek as long as Rubio in the race as well...but that's the wonder of strategic voting at work. Unfortunately, Murkowski and Crist's great adventures may well inspire more sore loser candidates in the future...and make it even more difficult for real independent candidates to be noticed.
I'm speaking of course of Charlie Crist who is vying for attention from Florida voters with Marco Rubio and Kendrick Meek as well as Lisa Murkowski who is trying to hold on to her Senate seat in Alaska against Joe Miller and Scott McAdams. The two took different paths to get to where they are today: Charlie Crist is running as an independent while Murkowski is trying to be elected via a write-in campaign as a Republican even though Joe Miller is the official Republican nominee. What the two have in common is that both kept running after seeking their party's nomination and failing to receive it. Crist launched his independent campaign in response to polls that showed Rubio the Republican favorite in the primary. Murkowski was even more audacious in that she competed in the Republican party primary to the bitter end and lost to Joe Miller yet still did not end her candidacy.
I won't argue that Crist and Murkowski don't bring anything unique to the table. Both are considered more moderate than their Republican opponents yet more conservative than their Democratic opponents. Had they chosen to leave their parties right from the get-go and run as independents I'd have completely respected their decision to do so and welcomed their attempts to shake things up in this stultifying two party political world. Under the circumstances, though, they both seem like sore losers and utterly untrustworthy to me. It's one thing to say, as Crist does now, that the Republican Party has left him and others of similar views behind -- it's another to seek the Republican nomination only to suddenly discover your independent roots when it becomes apparent you aren't going to be your party's nominee. Both Crist and Murkowski seemed to respect how their party did things right up to the point where they didn't become nominated candidates; that's exactly why I can't respect them. They thought the Republican Party was great...as long as Republican voters made the "right" choice in the primary. Had Crist polled better and Murkowski won her primary, they would never have bumped heads with their party. To me, both Crist and Murkowski seem absolutely desperate to gain power, and their candidacies seem an almost pure reflection of their personal ambition. I don't support "sore loser" laws which try to legally prevent independent candidacies from primary losers, but at the same time I don't support "sore losers"...I just don't see how you could ever trust a candidate who wants to win that badly.
Nonetheless, Murkowski and Crist are picking up votes according to the polls. Indeed, both are currently running close to their Republican rivals and beating the Democrats in their races. In Alaska, that perhaps reflects the difficult position the Democratic Party currently occupies in that state. In Florida, Crist's success seems to have come partly on the back of the Democratic nominee Kendrick Meek who has lost support from members of his own party. I find it rather puzzling that there are Democrats who would have voted for Meek over Charlie Crist had Crist been the Republican nominee yet are willing to vote for Crist over Meek as long as Rubio in the race as well...but that's the wonder of strategic voting at work. Unfortunately, Murkowski and Crist's great adventures may well inspire more sore loser candidates in the future...and make it even more difficult for real independent candidates to be noticed.
Sunday, May 23, 2010
Rand Paul, the Civil Rights Act, and the Trouble With Ideological Candidates
Kentucky Republican and Senate candidate Rand Paul has recently aroused a great deal of controversy for expressing concerns with one aspect of the 1964 Civil Rights Act: namely, the authority it gives to the federal government to forbid businesses from discriminating on the basis of race, color, religion, and national origin. While Paul has stated that he approves of the Act's forbidding of discrimination on the governmental level without reservation, he is uneasy with the idea of businesses being compelled to provide service to all due to his firm belief in the rights of property owners. It all boils down to, "Does a private entity get to decide what to do with its property even if it hurts other people?" To understand the nature of the controversy and Paul's stance on the issue, you might want to watch his interview on the Rachel Maddow Show: part 1 and part 2 are on YouTube.
While the younger Dr. Paul seems to see this issue purely through the prism of property rights, I think there are other factors involved which is why I disagree with him. You have the right to own a gun, but you can't use it in any possible way without infringing on the rights of others. In the same way, I don't think property owners should have the right to use their property as a weapon to hurt others and deny them from purchasing what may be vitally needed goods and services. I don't think it's too much of a sacrifice to ask property owners who choose to do business with the public at large to serve all equally regardless of their demographic, no more than I think it is too much of a sacrifice to ask gun owners not to shoot innocent people who aren't threatening life, limb, or property. I absolutely understand where Rand Paul is coming from -- property rights are not anywhere near as respected as they should be in this country. Still, even property rights should have limits, and the appropriate place for rights to end is when they start to hurt other people severely and unnecessarily. Oddly enough, I actually think the Civil Rights Act of 1964 is actually fairly moderate. It allows private clubs not open to the public to discriminate as they wish, and it allows all entities to discriminate against unmentioned groups all they want to (hence: "No shirt, no shoes, no service").
With that said, I've thought that all the media and blogging hoopla over Rand Paul's comments has been ridiculous, and it's given me some new insight into how the political powers that be seek to maintain the status quo. As wrong as I think Paul's position on the Civil Rights Act is, it's hardly as if he was campaigning to repeal it. Indeed, he has since stated for the record that he would not seek to change it and in fact he has even said that he would have voted for the Act despite its restrictions on business had he been in Congress at the time. He was never a racist demagogue blowing dog whistles to rally racists to his cause which is why he now resembles a dog running away with its tail between its legs as he tries to talk his way out of the firestorm. What Paul's "baggage" is is actually simply political ideology. People often wonder why it is that Republicans who talk about the importance of individual liberty when it comes to gun rights often turn around and support legislating morality or why Democrats are so keen on expanding social services but yet often also support inflationary policies and direct and indirect taxes that make products and services more expensive. The answer is easy enough: the overwhelming majority of politicians do not have an overarching political philosophy that they try to apply to each and every political stance they have. They don't mind being philosophically inconsistent -- it's probably not something most of them even think about. Rand Paul is vulnerable on issues like civil rights because he doesn't pick and choose when his political philosophy is important to him. He strives for consistency even when that leads him into uncomfortable territory. In his discussion with Rachel Maddow, he mentioned how freedom of speech protects the words of even those who hold despicable views. It's not a stretch at all to go on from there to say that property rights should also apply to those who hold despicable views. It's perfectly possible to support freedom of speech and property rights without necessarily supporting how those freedoms are used by cruel and hateful individuals. As such, I can respect Rand's point of view even though I disagree with him. He probably has a rosier view of humanity than I do and believes that racist business owners would get skewered in the market just as he's currently being skewered in the press and online. As much as I distrust government, I nonetheless don't trust people not to treat each other like crap either; to expect otherwise is to ignore the lessons of history.
What Paul's opponents on the Democratic side of things want now is for people to not simply disagree with Paul's position on civil rights but to be afraid of him. They want him to be perceived as a monster rather than simply as misguided. Above all else, they want people whose support of smaller government, lower taxes, and fiscal restraint (topics that Rand Paul made the center of his campaign rather than civil rights) would make them uneasy about voting for Jack Conway or any Democrat given the current political climate to stay home on Election Day. As a political ploy, it just might work -- if it does, I think it'll be an ample illustration of why people who are so passionate about their ideas that they take them to the nth degree seem to flounder when facing off against career politicians and the political establishment time and time again. While this makes it more difficult for extremists (relative to prevailing popular opinion, that is) to win office, it also makes it harder to get anything other than the same old breed of career politicians elected. Those folks aren't all bad, but frankly I'd bet at least a few of them are as perturbed by Rand Paul's advocacy for legislative term limits as they are about anything else the opthamologist has said.
While the younger Dr. Paul seems to see this issue purely through the prism of property rights, I think there are other factors involved which is why I disagree with him. You have the right to own a gun, but you can't use it in any possible way without infringing on the rights of others. In the same way, I don't think property owners should have the right to use their property as a weapon to hurt others and deny them from purchasing what may be vitally needed goods and services. I don't think it's too much of a sacrifice to ask property owners who choose to do business with the public at large to serve all equally regardless of their demographic, no more than I think it is too much of a sacrifice to ask gun owners not to shoot innocent people who aren't threatening life, limb, or property. I absolutely understand where Rand Paul is coming from -- property rights are not anywhere near as respected as they should be in this country. Still, even property rights should have limits, and the appropriate place for rights to end is when they start to hurt other people severely and unnecessarily. Oddly enough, I actually think the Civil Rights Act of 1964 is actually fairly moderate. It allows private clubs not open to the public to discriminate as they wish, and it allows all entities to discriminate against unmentioned groups all they want to (hence: "No shirt, no shoes, no service").
With that said, I've thought that all the media and blogging hoopla over Rand Paul's comments has been ridiculous, and it's given me some new insight into how the political powers that be seek to maintain the status quo. As wrong as I think Paul's position on the Civil Rights Act is, it's hardly as if he was campaigning to repeal it. Indeed, he has since stated for the record that he would not seek to change it and in fact he has even said that he would have voted for the Act despite its restrictions on business had he been in Congress at the time. He was never a racist demagogue blowing dog whistles to rally racists to his cause which is why he now resembles a dog running away with its tail between its legs as he tries to talk his way out of the firestorm. What Paul's "baggage" is is actually simply political ideology. People often wonder why it is that Republicans who talk about the importance of individual liberty when it comes to gun rights often turn around and support legislating morality or why Democrats are so keen on expanding social services but yet often also support inflationary policies and direct and indirect taxes that make products and services more expensive. The answer is easy enough: the overwhelming majority of politicians do not have an overarching political philosophy that they try to apply to each and every political stance they have. They don't mind being philosophically inconsistent -- it's probably not something most of them even think about. Rand Paul is vulnerable on issues like civil rights because he doesn't pick and choose when his political philosophy is important to him. He strives for consistency even when that leads him into uncomfortable territory. In his discussion with Rachel Maddow, he mentioned how freedom of speech protects the words of even those who hold despicable views. It's not a stretch at all to go on from there to say that property rights should also apply to those who hold despicable views. It's perfectly possible to support freedom of speech and property rights without necessarily supporting how those freedoms are used by cruel and hateful individuals. As such, I can respect Rand's point of view even though I disagree with him. He probably has a rosier view of humanity than I do and believes that racist business owners would get skewered in the market just as he's currently being skewered in the press and online. As much as I distrust government, I nonetheless don't trust people not to treat each other like crap either; to expect otherwise is to ignore the lessons of history.
What Paul's opponents on the Democratic side of things want now is for people to not simply disagree with Paul's position on civil rights but to be afraid of him. They want him to be perceived as a monster rather than simply as misguided. Above all else, they want people whose support of smaller government, lower taxes, and fiscal restraint (topics that Rand Paul made the center of his campaign rather than civil rights) would make them uneasy about voting for Jack Conway or any Democrat given the current political climate to stay home on Election Day. As a political ploy, it just might work -- if it does, I think it'll be an ample illustration of why people who are so passionate about their ideas that they take them to the nth degree seem to flounder when facing off against career politicians and the political establishment time and time again. While this makes it more difficult for extremists (relative to prevailing popular opinion, that is) to win office, it also makes it harder to get anything other than the same old breed of career politicians elected. Those folks aren't all bad, but frankly I'd bet at least a few of them are as perturbed by Rand Paul's advocacy for legislative term limits as they are about anything else the opthamologist has said.
Monday, May 17, 2010
Energy Policy and the Worst Case Scenario
We all make decisions about how much risk we are willing to take on as we go about our daily lives. Some of us focus more on probability (the likelihood that something bad will happen to us if we take a certain action) and others of us focus more on the worst case scenario, the most negative consequence that could reasonably occur in response to our action. If you focus purely on probability, an activity like skydiving is not particularly dangerous -- one death per 100,000 jumps is not too bad. On the other hand, skydiving accidents are frequently fatal when they do occur. The worst case scenario is severe.
Fear of the worst case scenario is perhaps the main reason why the United States hasn't embraced nuclear power to a greater degree than it has. The 1979 accident at the Three Mile Island nuclear plant that exposed millions of people to small doses of radiation had a decisive impact on public opinion. What happened at Three Mile Island wasn't the worst case scenario by any means -- no one died as an immediate result of the accident, and the public health implications of the event are still being debated. What it did, however, was remind the public, the government, and the power industry of just how dangerous nuclear power can potentially be. Nowadays the majority of the American people do support nuclear power once again, but 31 years is a long time for any event to hold a prominent place in the collective memory. Another serious nuclear accident could change perceptions in a jiffy, and regulators and the industry certainly haven't forgotten what happened in 1979.
The Gulf of Mexico Oil Spill of 2010, on the other hand, is a worst case scenario we're seeing unfold before our eyes. The initial catastrophe claimed 11 lives of oil workers, a tragedy in and of itself, but the ensuing disaster will have widespread implications for millions of people and animals. That the damage to the marine ecosystem and the Gulf Coast economy will be severe is a given -- how the disaster will affect the hydrologic cycle and weather patterns is more of an open question at this point. This thing is bad enough to fundamentally change how risky offshore oil drilling is perceived to be. The probability of such a spill hasn't really changed that much...remember, there's offshore drilling going on all over the world, from West Africa to the North Sea. Massive explosions and oil spills aren't typical occurrences. One study found that just 2% of the oil in the oceans is a result of offshore drilling. So, for me at least, the issue isn't whether or not offshore drilling is too bad for the environment to be permitted...what I wonder is if the worst case scenario is so severe that it's not even worth the small risk of such massive spills.
One approach is to try to make offshore drilling and nuclear power more safe through more stringent regulations. It seems clear that BP and Transocean did not do all they could do to prepare for a worst case scenario -- just as Three Mile Island changed nuclear governmental policies, so too will the Gulf Oil Spill change governmental policies towards offshore drilling. Still, regulations can only go so far. Accidents WILL happen. Although nuclear plants are probably safer now than they used to be, the cynic in me can't help but wonder if the main reason Three Mile Island hasn't been repeated is because the nuclear power industry was utterly stalled following the accident and has only very recently shown some signs of revival. I can imagine a new regulatory environment having a chilling effect on offshore drilling in the Gulf -- risky behavior is not always banned when it can be disincentivized instead. Is that the right choice in a world where petroleum is still king and likely still will be for some time to come? I'm honestly not sure. We've seen a glimpse of the worst case scenario for offshore drilling and it is extremely ugly, but if the end result of all this is that Americans will just consume more oil drilled offshore from other countries, is that really an environmental triumph or just an economic setback?
Fear of the worst case scenario is perhaps the main reason why the United States hasn't embraced nuclear power to a greater degree than it has. The 1979 accident at the Three Mile Island nuclear plant that exposed millions of people to small doses of radiation had a decisive impact on public opinion. What happened at Three Mile Island wasn't the worst case scenario by any means -- no one died as an immediate result of the accident, and the public health implications of the event are still being debated. What it did, however, was remind the public, the government, and the power industry of just how dangerous nuclear power can potentially be. Nowadays the majority of the American people do support nuclear power once again, but 31 years is a long time for any event to hold a prominent place in the collective memory. Another serious nuclear accident could change perceptions in a jiffy, and regulators and the industry certainly haven't forgotten what happened in 1979.
The Gulf of Mexico Oil Spill of 2010, on the other hand, is a worst case scenario we're seeing unfold before our eyes. The initial catastrophe claimed 11 lives of oil workers, a tragedy in and of itself, but the ensuing disaster will have widespread implications for millions of people and animals. That the damage to the marine ecosystem and the Gulf Coast economy will be severe is a given -- how the disaster will affect the hydrologic cycle and weather patterns is more of an open question at this point. This thing is bad enough to fundamentally change how risky offshore oil drilling is perceived to be. The probability of such a spill hasn't really changed that much...remember, there's offshore drilling going on all over the world, from West Africa to the North Sea. Massive explosions and oil spills aren't typical occurrences. One study found that just 2% of the oil in the oceans is a result of offshore drilling. So, for me at least, the issue isn't whether or not offshore drilling is too bad for the environment to be permitted...what I wonder is if the worst case scenario is so severe that it's not even worth the small risk of such massive spills.
One approach is to try to make offshore drilling and nuclear power more safe through more stringent regulations. It seems clear that BP and Transocean did not do all they could do to prepare for a worst case scenario -- just as Three Mile Island changed nuclear governmental policies, so too will the Gulf Oil Spill change governmental policies towards offshore drilling. Still, regulations can only go so far. Accidents WILL happen. Although nuclear plants are probably safer now than they used to be, the cynic in me can't help but wonder if the main reason Three Mile Island hasn't been repeated is because the nuclear power industry was utterly stalled following the accident and has only very recently shown some signs of revival. I can imagine a new regulatory environment having a chilling effect on offshore drilling in the Gulf -- risky behavior is not always banned when it can be disincentivized instead. Is that the right choice in a world where petroleum is still king and likely still will be for some time to come? I'm honestly not sure. We've seen a glimpse of the worst case scenario for offshore drilling and it is extremely ugly, but if the end result of all this is that Americans will just consume more oil drilled offshore from other countries, is that really an environmental triumph or just an economic setback?
Tuesday, April 13, 2010
A More Democratic Form of Capitalism
Many people see the financial crisis as an example of a failure of capitalism in general. It is capitalism's very nature, they argue, to create boom and bust cycles and cause grossly unequal and unfair distributions of wealth. On the other side of the equation, you have people arguing that capitalism essentially doesn't exist in the modern world -- it's all corporatism as governments bend over backwards to give the biggest and most favored corporations extra advantages over smaller businesses, including bailouts. Both sides of critics would agree that modern economic system is not even close to ideal, as indeed do I. Sometimes, though, I wonder if a mistake is made by focusing too much on business and too little on the individual.
Who is the modern individual? In the United States, he tends to be a worker, a consumer, and a debtor. When he loses his job, he really has no personal safety net -- he has no savings to speak of to tap into and debts that still need to be paid regardless of whether or not he has income. He relies on unemployment payments from government unemployment insurance funds, bankruptcy to relieve his debts, and family and friends to help him stay afloat until he finds a new job. If he doesn't find a new job before his unemployment check runs out, he will likely have to rely on government benefits and charity. Thus, work is the center of his universe -- it may not be so extreme as, "If a man will not work, he shall not eat," but the consequences of being unemployed are dire indeed. Ultimately, the most disturbing aspect of the current recession to me is the notion endorsed by some economists of a "new normal" and permanently higher unemployment. Karl Marx would still understand the world of today: for all our technological advances and all our sophisticated machinery, we're still a world of workers and society is struggling to deal with the possibility of larger numbers of people not working less because they do not want to as because there is less need for their labor due to technology and outsourcing.
I wonder if a change in ideals is in order. Perhaps we need to stop idealizing work so much and instead idealize the concept of owning. We live in a world where even starting a business has become easier -- online businesses often require less startup capital than real world ones, for instance. It is also easier to run a "mini-business" online as you often don't have the same level of maintenance costs (for instance, you might store inventory in your closet instead of a rented warehouse) and may not need to commit as much time (for example, you don't have to wait all day behind a counter or answer the phone to fulfill orders...you just need to check your email or online storefront every so often). It has also never been easier to be a part owner of a publicly traded company by owning stock. Competition amongst discount brokers have driven fees way down which makes a tremendous difference for the investor without much money. The reason, of course, why owning tends to be less glorified is that starting a business or buying stock necessarily entails some risk -- you may, indeed, end up worse off for your investment than better off. Owning also tends to reward the patient, the creative, and the studious which are not qualities everyone has to the same degree. However, work also entails some risk: harsh working conditions claim the lives of workers each year, lead to many injuries, and sometimes cause long-term health catastrophes, for instance. Most importantly, though, work is risky because you may lose your job at any time. I think it is a necessity to have something to fall back on because it is very likely a worker will end up unemployed periodically and, if the "new normal" is to be believed, periods of extended unemployment may be only more common in the future.
Not all investments are equally risky, and it is certainly possible even for the layman to research public companies to see how deeply they are in debt and if they are making money. A few clicks on Google Finance is all it takes! It is unfortunate that "sexy" growth stocks like Apple are often the ones most promoted in the media -- I actually think it's wiser to seek out dividend paying stocks that will pay you an income as long as you own them. Many utility stocks, for instance, routinely yield 4 to 5 percent in dividends alone per year even now, and capital appreciation is also possible. They also often offer direct buy programs which enable you to entirely circumvent brokerage fees. While 401Ks and other retirement plans can offer something of a safety net if you have access to them, I tend to think workers should invest on their own as well -- you definitely will need money for retirement, at least if you live that long, but you will also need money during your periods of work and especially unemployment. Tax deferment is sometimes overrated in my view.
Many would argue that savings, because they are more reliable and often government-insured, make for a better personal safety net. Unfortunately, though, savings are quite poor at providing an income, especially when interest rates are as low as they are now. (Granted, when interest rates are low debtors also have fewer expenses, but since so many debtors have high interest debt these days that impact is less apparent.) For instance, I get a little over one percent return per year on my savings account, and I only get that much because I shop around for banks. I think it's important to have reliable money on hand and you should never put everything into a risky venture, but one percent is probably not going to keep you afloat unless you're very rich indeed. Inevitably, if unemployed, you'll have to dig deep into the principal and your return from your savings would continue to drop so your situation will only grow steadily worse over time. That's not even mentioning the hazard of inflation which can make your savings gradually worth less over time -- it's not entirely irrational to not save and to borrow heavily when you account for government monetary policy.
Having more owners would change the world. More small businesses would mean more competition for mega-corporations. Had there been more small car companies like Tesla Motors, I'm not so sure GM and Chrysler would have gotten that bailout after all. After those irresponsible giants had crashed to the ground, a bevy of new car companies might have emerged to employ the newly unemployed auto workers and engineers. OK, that's not such a great example because starting a car company requires a huge amount of investment...but at least it's topical. Still, widespread competition in every industry is the best prescription for avoiding bailouts. Having more individual stock owners would shift the balance of financial power a little further away from huge financial institutions (who are currently the main owners of stock). Individuals who trade actively or own dividend paying stocks will have an income apart from their work and savings, enabling them to avoid taking on so much debt and giving them something to fall back on when they lose their jobs.
I know there are those who would say that there is simply no way that the average person is cut out to be an owner of a small business or capable of managing a portfolio of stocks. That's something of a self-fulfilling prophecy -- people are petrified of the risks they don't know (while failing to see the risks all around them, like that of accumulating too much debt or relying too much on a job) so when they do take a chance on something new they tend to panic and lose everything. Average people are capable of many things, however, and receive much less credit than they deserve. It seems to be generally accepted that most people can learn to read and write. If they go very far at all into the educational system, they'll also learn something of algebra. Outside of school, most of them will work at various jobs and have children. Owning a business or a stock is a serious pursuit, but it is a lot easier than raising children in my view. So I firmly do believe that a person who is willing to put the time in to learn can be a successful owner or part owner. Buying stocks randomly or starting a business that sells products only you yourself would be interested in is indeed dangerous, but I doubt you would do either thing if you researched a little before you acted.
Who is the modern individual? In the United States, he tends to be a worker, a consumer, and a debtor. When he loses his job, he really has no personal safety net -- he has no savings to speak of to tap into and debts that still need to be paid regardless of whether or not he has income. He relies on unemployment payments from government unemployment insurance funds, bankruptcy to relieve his debts, and family and friends to help him stay afloat until he finds a new job. If he doesn't find a new job before his unemployment check runs out, he will likely have to rely on government benefits and charity. Thus, work is the center of his universe -- it may not be so extreme as, "If a man will not work, he shall not eat," but the consequences of being unemployed are dire indeed. Ultimately, the most disturbing aspect of the current recession to me is the notion endorsed by some economists of a "new normal" and permanently higher unemployment. Karl Marx would still understand the world of today: for all our technological advances and all our sophisticated machinery, we're still a world of workers and society is struggling to deal with the possibility of larger numbers of people not working less because they do not want to as because there is less need for their labor due to technology and outsourcing.
I wonder if a change in ideals is in order. Perhaps we need to stop idealizing work so much and instead idealize the concept of owning. We live in a world where even starting a business has become easier -- online businesses often require less startup capital than real world ones, for instance. It is also easier to run a "mini-business" online as you often don't have the same level of maintenance costs (for instance, you might store inventory in your closet instead of a rented warehouse) and may not need to commit as much time (for example, you don't have to wait all day behind a counter or answer the phone to fulfill orders...you just need to check your email or online storefront every so often). It has also never been easier to be a part owner of a publicly traded company by owning stock. Competition amongst discount brokers have driven fees way down which makes a tremendous difference for the investor without much money. The reason, of course, why owning tends to be less glorified is that starting a business or buying stock necessarily entails some risk -- you may, indeed, end up worse off for your investment than better off. Owning also tends to reward the patient, the creative, and the studious which are not qualities everyone has to the same degree. However, work also entails some risk: harsh working conditions claim the lives of workers each year, lead to many injuries, and sometimes cause long-term health catastrophes, for instance. Most importantly, though, work is risky because you may lose your job at any time. I think it is a necessity to have something to fall back on because it is very likely a worker will end up unemployed periodically and, if the "new normal" is to be believed, periods of extended unemployment may be only more common in the future.
Not all investments are equally risky, and it is certainly possible even for the layman to research public companies to see how deeply they are in debt and if they are making money. A few clicks on Google Finance is all it takes! It is unfortunate that "sexy" growth stocks like Apple are often the ones most promoted in the media -- I actually think it's wiser to seek out dividend paying stocks that will pay you an income as long as you own them. Many utility stocks, for instance, routinely yield 4 to 5 percent in dividends alone per year even now, and capital appreciation is also possible. They also often offer direct buy programs which enable you to entirely circumvent brokerage fees. While 401Ks and other retirement plans can offer something of a safety net if you have access to them, I tend to think workers should invest on their own as well -- you definitely will need money for retirement, at least if you live that long, but you will also need money during your periods of work and especially unemployment. Tax deferment is sometimes overrated in my view.
Many would argue that savings, because they are more reliable and often government-insured, make for a better personal safety net. Unfortunately, though, savings are quite poor at providing an income, especially when interest rates are as low as they are now. (Granted, when interest rates are low debtors also have fewer expenses, but since so many debtors have high interest debt these days that impact is less apparent.) For instance, I get a little over one percent return per year on my savings account, and I only get that much because I shop around for banks. I think it's important to have reliable money on hand and you should never put everything into a risky venture, but one percent is probably not going to keep you afloat unless you're very rich indeed. Inevitably, if unemployed, you'll have to dig deep into the principal and your return from your savings would continue to drop so your situation will only grow steadily worse over time. That's not even mentioning the hazard of inflation which can make your savings gradually worth less over time -- it's not entirely irrational to not save and to borrow heavily when you account for government monetary policy.
Having more owners would change the world. More small businesses would mean more competition for mega-corporations. Had there been more small car companies like Tesla Motors, I'm not so sure GM and Chrysler would have gotten that bailout after all. After those irresponsible giants had crashed to the ground, a bevy of new car companies might have emerged to employ the newly unemployed auto workers and engineers. OK, that's not such a great example because starting a car company requires a huge amount of investment...but at least it's topical. Still, widespread competition in every industry is the best prescription for avoiding bailouts. Having more individual stock owners would shift the balance of financial power a little further away from huge financial institutions (who are currently the main owners of stock). Individuals who trade actively or own dividend paying stocks will have an income apart from their work and savings, enabling them to avoid taking on so much debt and giving them something to fall back on when they lose their jobs.
I know there are those who would say that there is simply no way that the average person is cut out to be an owner of a small business or capable of managing a portfolio of stocks. That's something of a self-fulfilling prophecy -- people are petrified of the risks they don't know (while failing to see the risks all around them, like that of accumulating too much debt or relying too much on a job) so when they do take a chance on something new they tend to panic and lose everything. Average people are capable of many things, however, and receive much less credit than they deserve. It seems to be generally accepted that most people can learn to read and write. If they go very far at all into the educational system, they'll also learn something of algebra. Outside of school, most of them will work at various jobs and have children. Owning a business or a stock is a serious pursuit, but it is a lot easier than raising children in my view. So I firmly do believe that a person who is willing to put the time in to learn can be a successful owner or part owner. Buying stocks randomly or starting a business that sells products only you yourself would be interested in is indeed dangerous, but I doubt you would do either thing if you researched a little before you acted.
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