Wednesday, May 27, 2015

Unhinged from Reality, Part I: Democrats, Socialism, and the Corporate State

For the past 14 years, I have worked in a place dominated by Democrats, and the most liberal ones at that. In the view of many of may colleagues, there is nothing that government cannot do as long as the political will exists to get it done.

Raise the minimum wage to $15 an hour and create instant prosperity? Done. Expand medical coverage to everyone, increase the regulatory state, have all forms of energy from electricity to fuel be "zero-emissions," and end all poverty by government fiat? Done! All it takes is courage on behalf of legislators to stand up to a few rich people, and the clean, prosperous, and free society is ours for the taking.

Frostburg State University, where I teach, is part of the University System of Maryland, and Maryland is one of the nation's most "blue" states, politically speaking. Let me correct myself. Three counties, Montgomery, Howard, and Prince Georges, and the City of Baltimore provide nearly all of the legislators that give the Democrats a huge majority in the state legislature. The other counties are flyover country, as far as the state government is concerned.

In many ways, Maryland today is like the Deep South between the end of Reconstruction and 1980 when the only competitive elections were Democratic primaries. Yes, the voters recently elected a Republican governor, but in 2018, I have no doubt that he will lose to an upcoming Democrat just as Republican Bob Ehrlich lost to Martin O'Malley in 2006 after serving one term. Democrats represent the political equilibrium in Maryland, and that is not going to change, given the demographics, both ethnically and occupationally, in this state.

Maryland, or, to be more specific, political attitudes and beliefs of Democrats here, are the future of the Democratic Party, so it is instructive to know what they see as the Good Society to know where the rest of us are headed. Like Republicans (with whom I will deal in a future post), Democrats where I work have become unhinged from economic and social reality to a point where what they believe about the economy is fantasy, but they believe that all it takes is an iron will on behalf of their party to make that fantasy reality.

What Democrats Believe, Economically Speaking

Thirty years ago, when I lived and worked in Chattanooga, Tennessee, I had a colleague who was the epitome of the Democratic Party activist. The Party was his religion, the Democratic nominee for the White House his god, and all Truth and Goodness sprang from the Party Platform. The only reason that Democrats did not own the White House, he claimed, was because of the Vietnam War, and had the Democrat's Democrat, Lyndon Johnson, not escalated the fighting there, he reasoned, LBJ's Great Society programs would have so transformed this country that all poverty would have disappeared and the United States would have one-party rule forever. If only.

He never could articulate as to why some government wealth transfer programs would have created such wondrous results; they just would. His occupation was being a city planner, and he had a planner's worldview in which planners like himself had the duty to impose their will on others because only they knew what would constitute the truly Good Society.

The first thing, he claimed, was total government control over the economy. After all, he claimed, since government had control of money, that was proof that government created all that was good in an economy and that without the guidance of government planners, the entire economy would collapse into chaos and ruin.

At the time, the Cold War still existed and so naturally the subject of the Soviet Union and its planned economy came up. When asked why the U.S.S.R. had what people recognized as a dysfunctional economy that was plagued by shortages, shoddy goods, and long lines for basic staples, he replied: "The Soviet Union has not been a country as long as the United States." That was it. Because the U.S.S.R. had existed as an official political entity for (at the time) 68 years and the USA was 209 years old, that situation alone explained why the Soviet economy performed so poorly. Thus, he reasoned, the longer the U.S.S.R. remained a political entity, the more the economy would improve. There was no causality, no logical movement from A to B, just a statement of what he believed to be fact.

At the time, I thought him to be on the fringes, since his beliefs lacked basic economic logic, but as I observe the campaigns of Martin O'Malley, Hillary Clinton, and Bernie Sanders, I have come to believe that my friend's radical views 30 years are now in the Democratic Party mainstream. How can it be that a political party could become that unhinged from economic reality?

Despite the supposed differences between the Democratic candidates, they pretty much believe the same thing: the federal government can order a state of prosperity by raising taxes to confiscatory levels, implementing a $15 an hour minimum wage, expanding vast subsidies for "renewable" energy, expanding the Social Security and food stamp programs, shutting down whole industries, and provide "free" medical care to everyone. Out of that will rise the Golden Society just as Aaron tried to convince Moses that the Golden Calf in the book of Exodus simply rose from the flames when Aaron threw a bunch of gold jewelry into it.

Robert Reich, who is not running for president but who provides the so-called intellectual ammunition for the Democratic candidates, has publicly said that government must force up wages and expand spending. In so doing, he reasons, it will create what he calls a "virtuous circle" in which people at the lower rungs of the economy increase their spending, and that increased spending will result in more production of goods and services and, thus, bring about an upward spiral to an economic nirvana.

One reason for this move into economic fantasy is the grassroots leadership of the Democratic Party. While labor unions always have gravitated toward Democrats, in the past unions representing workers in private businesses knew that if they totally destroyed the Golden Goose, that there would be nothing left for them.

Today's Democratic leadership, however, comes from government employee unions and they are not bound by the same economic realities that governed the United Auto Workers or the steelworkers. In 1980, there was consternation when it was revealed that more than half of the delegates to the Democratic National Convention were government employees. When the 2016 DNC rolls around, no one even will care that the vast majority of delegates will be members of government employee unions who will demand that government use deadly force, if necessary, to protect their pensions, and give them pay raises. Paul Krugman will say this is good because the government employees will be "spending money," which means they can claim that by confiscating money from anyone not lucky enough to be a member of a government employee union, they actually are creating prosperity for all.

Democrats will argue that what is needed is more political will. Political will to raise the marginal tax rates to at least 70 percent. Political will to force closure of electric power plants that burn coal, oil, and natural gas. Political will to run oil companies out of business. Political will to bring about "renewable energy" that will result in clean air, clean water, and spiritual growth. Political will to force both Roman Catholic and Protestant churches to change their ancient theology about sexuality or face government sanctions and even forced closure, if that is what is needed.

In short, Democrats argue that what society needs more than anything else is political coercion and expanded confiscation of private property and the will to force people to accept all of the tenets of the Sexual Revolution. People won't give up their guns and their religious beliefs easily, nor will they be willing to gladly accept the real economic deprivation that would come about as the result of the policies Democrats are demanding. That is where an iron political will comes in, and an iron will requires the use of force, deadly force, if necessary, especially if churches refuse to accept the Holy Doctrines of the Sexual Revolution.

As Radley Balko has written, every government law that is to be enforced carries the threat of violence, and it is clear that government at every level has no qualms about being violent. Even Salon Magazine, which is little more than a Democratic Party media tool (as Fox News is to Republicans), admits that government violence is not a partisan issue.

The Implementation of the Corporate State

For all of their rhetoric, however, even Democrats know that they cannot implement the kind of economy that characterizes Cuba, North Korea, or the former U.S.S.R. and make the voters happy. It is one thing for Bernie Sanders essentially to call for an end to the oil industry. (His claim is that he just wants to end corporate welfare for private energy companies -- a laudable goal -- but it is clear that he wants to go much further. Likewise, he wants to create and expand the corporate welfare for companies pursuing so-called renewable energy and put their competitors out of business.) It is quite another for whole industries that provide vital goods and services simply to disappear with nothing to replace them.

Likewise, Democrats can rail against Big Pharma, but someone has to produce the medicine AND the campaign contributions. That is where the Corporate State comes in, and Democrats have embraced Crony Capitalism all the while condemning it in their rhetoric.

No one does that better than Hillary Clinton and she and her ex-president husband have lots of experience getting rich via the Corporate State. While Hillary is running as a populist who wants to end corporate abuses and shut down businesses she doesn't like, her income sources are dominated by corporate money via her speeches and contributions to the Clinton Foundation, which essentially is a slush fund for the Clinton family. (Yes, yes, I know. The Clinton Foundation will eradicate AIDS in the Third World, so contributions to the foundation are worthy and humanitarian. They have nothing to do with seeking political favors and enriching the Clintons.)

Now, the Occupy Democrats and others on the Bernie Sanders Left supposedly don't like Crony Capitalism and claim they want to eradicate it. However, they also know that the Clintons really bug Republicans, and if there is one thing that Occupy Democrats and their allies hate, it is Republicans. In fact, they hate Republicans much more than they hate Crony Capitalism and the Corporate State.

Furthermore, they reason that if they can get corporations on their side (and simultaneously get lots of corporate money for their own political initiatives, then they would rather live with the furtherance of the Corporate State than see a Republican in the White House). They even can convince themselves that they are doing nothing more than providing much-needed regulation of corporations, which would be running amok and creating chaos if it were not for the far-sighted actions of the Democratic Party.

Such viewpoints truly are unhinged from any reality. The Democrats' brand of corporate welfare will cause production to shrink, not expand. Furthermore, every initiative that I have seen from the Democratic candidates for president will increase costs of production of goods and services, and when those kinds of costs increase systematically over a large scale, the overburdened economy slowly implodes.

True, Sanders, O'Malley, and Clinton will claim that forcing up production costs will expand the economy because such actions will increase the amount of money being spent on production. In reality, higher production costs will mean less will be produced, which translates into a lowering of real standards of living.

Notice that not one Democrat is going to run on a platform of reducing the standard of living for everyone. They might argue that their tax-the-rich schemes might lower living standards for the so-called One Percent, but that overall everyone else will experience a cornucopia of wealth.

I'm sorry, but the One Percent cannot buy prosperity for the rest of us. They CAN buy prosperity for the likes of Hillary and Bill Clinton, Martin O'Malley, and even Bernie Sanders, who I guarantee will quietly float his own versions of corporate welfare all the while denouncing it in his political rhetoric.

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