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The Audiology of Hope: Dogwhistle Economics

I’m republishing this little gem from January 2008.  It was written by RonKSeattle.  He had another post with profiles of Obama’s economic advisors.  Still trying to track it down.  Anyway, the point is, none of what Obama has done should be a surprise.  He hasn’t changed.  He’s always been like this.  The Obama fanbase just didn’t want to see it.

And now, without further adieu…

*************************************************************************************************************

Something about Obama attracts New D’s, GOP’s, Broderites, Indies, Perotistas, Reagan D’s and Libertarians alike. Is it his big table? His promise to turn the page? His post-racial posture? Is it his cologne?

Or is it Austan Goolsbee?

Who??? Goolsbee. Economic wunderkind, forensics champ, MIT PhD, Yale Bonesman out of Waco via Milton Academy, Obama’s chief / top / senior economic spokesman and senior policy advisor.

Oh, and DLC senior economist.

Huh? Whuzzat? Yes, that DLC.

June 19, 2006
Austan Goolsbee Joins DLC and PPI as Senior Economist
WASHINGTON, D.C. — The Democratic Leadership Council (DLC) and the Progressive Policy Institute (PPI) are pleased to announce that Austan Goolsbee, the Robert P. Gwinn Professor of Economics at the University of Chicago, has agreed to become Senior Economist to both organizations.

You hadn’t heard that, had you? That’s what a dog whistle is for. In distant corners of the political grid, they hear the pied piper’s dog code loud and clear … and they do come a-runnin’.

Read on as we crack the code.

And yes, it’s that U. of Chicago — bastion of neoliberal (free market) political economics, skunkworks behind the Old Right’s counterrevolution against the intellectual decadence of FDR’s New Deal, and Obama’s primary academic stomping ground.

As one conservative Yale alum testifies:

… voters who usually lean Republican should take a second look at Obama … Although some of his centrist economic prescriptions may disenchant liberals who distrust the benefits of globalization, Goolsbee said economic data indicate that free trade leads to higher wages.

George Will digs Goolsbee. What’s not to like … if you’re George F. Will?

The liberal’s liberal economist Paul Krugman? Not so much. Goolsbee is the unnamed advisor Krugman refers to when he tabs Obama’s stimulus plan “disreputable”. [There’s the Rosetta Pebble, BTW, to a code we’ll break later.]

Enough about who Goolsbee is. What does Goolsbee think?

Goolsbee thinks single payer is a bad idea. He thinks Warren Buffett is just lucky. He thinks globalization is no biggie. He thinks subprime lending gimmicks made the market more perfect. And he gives Dubya high marks on trade, taxes, job creation … but an “Incomplete” on Social Security.

Onward to the Big Picture framework questions of progressive policy and politics.

How do we remedy lopsided distribution of wealth and income? To Goolsbee, the main answers are education, education, and educational opportunity.

Obama’s vision, as focused by Goolsbee’s lenses, includes “democratizing capitalism”. I guess that means we’ll all be rich, a few decades after the rich pull everybody else on board into the investor class. (Heard this somewhere before, have you?)

Much as I sympathize with Goolsbee on some points of theory and stylistic emphasis, this is just wrong. No doubt an educated workforce grows the economy pie in toto. No doubt certain members of an educated class find the biggest slices on their plates. But in a positionally-competitive casino economy keyed to disproportionate reward for a limited number of key men (in franchises, networks and lineages), the system won’t divvy up rewards in natural open market-theoretic shares just because everybody moves up the skills ladder.

This doesn’t level the playing field – it just ratchets the game up to a higher level of difficulty. Same social order of advantage and disadvantage, with fatter sheep for the same ravening wolves.

How do we fix public education? With incentive systems, of course. Merit pay for schoolteachers.

On the plus side, Goolsbee does favor public investments in education and infrastructure. (These are the highest-return investments we know how to make, public or private.) Push the money out there, let private actors rearrange it optimally.

How do we regulate global corporate enterprise? Much as we regulate US corporations, i.e., not much. Strained through the academic economist’s revealed preference for market outcomes, regulations are just a rats-nests of departures from the optimality of market outcomes. Outcome-directive levers of policy — mandates, prohibitions and other regulations — are bad. Incentives and public investments are good, as mitigations to market insecurities.

How do we reform health care? With a mandate-free version of Romney – Edwards – Clinton – Schwarzenegger insurance mandates.

Can we tax the rich? [In a global mobile economy, that’s really the question of the age.] Here’s a plus. Goolsbee argues that marginal tax rates on top-share incomes may not be as all-out destructive as Chicago School orthodoxy assumes. Still, the Obama camp is reluctant to venture into progressive taxation much beyond ending the Bush cuts.

Energy policy?

We should use a market-based strategy that gradually reduces harmful emissions in the most economical way. John McCain and Joe Lieberman are continuing to build support for legislation based on this approach,

Long on incentives, short on mandates.

How do we treat Social Security? Well, here’s a puzzle. Barack Obama’s position (as outlined by Goolsbee) is a dead ringer for Hillary Clinton’s position (as scathingly criticized by Barack Obama).

Whence this worldview? A Financial Times profile finds Goolsbee “almost wholly lacking in political experience”. This may account for his adherence to the textbook economist’s faith in smooth curves and theoretical equilibria, and disdain for the disruptive hand of government.

He’d rather have the invisible giants tilt the landscape so that desirable outcomes flow naturally downhill and accumulate in convenient catch-basins.

Contact with real politics — real constituents coming to you with real problems — would have tended to take the gloss off whatever smooth shiny vision he brought to the party … or to steer him toward a comfort zone in the other party, serving the Haves and sighing “can’t be helped” to the plight of the Have-Nots.

Breaking the code: What does all this tell us about Barack Obama’s vision of a low-conflict New Politics, and its strange attraction across the political spectrum? Here, it gets interesting.

Obama sincerely believes he’s on to something. He hasn’t told us what it is yet, or how it would work, or how he knows it would work, but he believes it’s possible in principle to satisfy all sides of today’s major divisions of interest.

Apparently he is convinced that much of the conflict evident in today’s politics is inessential … derivative … superfluous. Where does he get that idea? Perhaps he’s informed by the siren’s call of naive economics and market idealism. If regulations were largely unnecessary, if imbalances were largely self-correcting, if economic growth itself were the path to economic justice … then we could enrich the deserving Have-Nots without all those disagreeable takings from the powerful Haves.

There’s a parallel here to presidential epochs past. Running for office, Reagan really thought he could give everyone a thirty percent tax cut, increase tax revenues, build a 600-ship Navy and a missile shield in space, and fund it by eliminating “ two words: fraud and waste“.

A closer parallel: Running for office, George W. Bush really thought he could give American conservatives their desired freedom from taxes and regulation, but also free them from the pangs of stricken conscience at the misfortune of others.

[Don’t kid yourself. Few conservatives are indifferent to hungry kids or grannies freezing in the streets, even if it’s not their kids or their grannies. They just don’t know how to solve this problem without morphing into the despised — and economically inconvenient — liberals.]

Thus was born “compassionate conservatism“. The advantaged could sleep soundly knowing that their very selfishness paved the road to riches for the disadvantages.

Yeah, it was a crock — but so many wanted to believe, and so few asked the hard questions.

Now, with America beset by the legacies of these shared daydreams, who will ask the hard questions?

And who will respond to the beguiling whistle, and fall in line with the doggie parade?

Wednesday: Running, junk and diapers

 Update:  Holy Hemiola!  Susie says that the heat has buckled part of the Schuylkill Expressway in Philadelphia.  That’s not good.  The last time I had to go to Philly, the traffic was one of the most miserable experiences of my annus horribilis.  Looks like it’s going to be closed during rush hour.  Good thing it wasn’t an I35 bridge style collapse. Still, *I* wouldn’t drive over this section of highway.  Nosiree.  If only we had a stimulus package that could have fixed our aging infrastructure…

Run for the Employable

I got a little behind on my Couch to 5K running plan during the rainy May we had in NJ.  For those of you with iPhones, there’s an app for that. The one I use is called Get Running. It’s easy to use and you can play your own music in the background over the cheery cues of your British running coach. Happily, I am back on track and working on week three, for those of you who want to follow along or join in.  In another week or two, I propose that interested parties get together to run in the cool hours of the morning.  If any employable people want to run with me, let me know in the comments below and I’ll let you know where you can meet me.  I’m still taking suggestions for T-Shirts.  My present concept is black letters on white that says “em-ploy-able” in three lines across the front and your job title across the back.

My run list is shown below.  Today, I added Paul Young’s “Love of the Common People”, a little ditty popular during the Reagan Recession, and for our union friends out there, Billy Bragg sings “There is Power in a Union”.  These two songs are great for the brisk walking/warm up stage.
1.) Amazing Grace- Laura Love (warm up)
2.) Paul Young – Love of the Common Peopple
3.) There is Power in a Union
4.) The Heartbreak Rides- AC Newman
5.) Firework – Katy Perry (one of the best running songs.  What a surprise)
6.) Fireflies – Owl City
7.) Real Wild Child- Iggy Popp
8.) Jessica- Allman Brothers
9.) Raise Your Glass- The Warblers (Glee)
10.) Welcome to the Future – Brad Paisley
11.) Iko Iko – The Belle Stars
12.) My Big 10 Inch Record – Aerosmith
13.) Love Today- Mika
14.) All These Things That I’ve Done- The Killers
15.)Let the River Run- Carly Simon
16.) River of Dreams- Billy Joel
17.) Run – George Strait (cool down)
18.) Volcano- Jimmy Buffet (post run stretch)

Basic guidelines:

See your doctor before starting any exercise program.  Don’t take on more than you are physically able.  Run if you can, if you can’t run, walk, if you can’t walk, roll.  Other activities, like Zumba for the Employable, are totally cool by me.  Just do it together, where’s it’s visible.  Wear whatever shoes you like.  I wear Nikes because they are the only running shoes that don’t give me intense shin pain for two weeks.  Yes, I have tried others.  If Nikes bother YOU, don’t wear them.  Keep your eyes on your own shoes.  Running shoe purity is not welcome here.  Dress comfortably.  Nothing too tight or too loose.  Batten the boobies.  Drink water and make sure to stretch before and after.  Lunges, hamstring curls, calf stretches all highly recommended.  If you forget, your body will remind you a few days later.  So, it’s best to take a few minutes and release the tension in your muscles.  It will feel good.

On the pharma front:

The Supreme Court has ruled against Stanford University in favor of Roche in a disputed patent case.  I haven’t read the whole decision but Derek Lowe at In the Pipeline has been following this for some time now.  This is what happens when you don’t consult a lawyer before signing over your patent rights. It’s a little intimidating to be in a room with suits who slide papers over to you and tell you they can’t do business until you sign. I’m particularly concerned these days because Big Pharma seems determined to turn its employees into independent contractors.  After we budding entrepreneurs figure out how to cure Crohn’s disease or cancer on our own, Pharma and venture capitalists will want in on the deals.  And that’s where the innovator had better be very careful when signing away their rights to the patents.  It could mean years of work for very little return.

In fact, I’m more than a little concerned that there are no professional organizations looking out for independent R&D professionals, now forced to make their fortunes on their own.  The ACS does not seem to be evolving, sadly.  Maybe it’s time to reintroduce the concept of the guild for R&D professionals.  We need protection for our intellectual property as well as a fair return on our investment of time and money.  And for those of us with the requisite 10,000 hours that indicate mastery of our subject matter, it’s time we considered ourselves to be professionals like doctors, writers and plumbers.  Does anyone know anything about Thomas Malone and the new guild concept for e-lancers? My gut feeling is that we dispossessed better move on this quickly.

Moving on…

The black hole that is the administration’s plan for the unemployed seems to centered around Tim Geithner.  His name keeps popping up over and over again.  And not necessarily in a good way. The latest is from Matt Yglesias, he who was able to snag a gig at a prestigious online magazine at the tender age of twenty something.  Still can’t figure out why more lefty women aren’t getting tapped for money paying writing opportunities.  You’d think the world had never heard of George Sands or Currer Bell or George Elliot.  We could be unsexed.  But I digress.  I’m sure there’s a reason why that Y chromosome carries so much gravitas.  Let me know when someone figures it out.

ANYWAY…

Matt Says that Christina Romer and Larry Summers, who were in favor of tackling unemployment, were overridden by Tim Geithner and Peter Orzag who want to bring down the deficit.  Romer was supposedly the expert who should have had the most pull in this situation but Obama sided with Orzag and Geithner.  Summers probably undercut Christina Romer’s position years ago with his stupid remarks about women being incapable of great mathematical and scientific thought.  Thank you, Larry.

It’s very interesting how the finger pointing has increased  lately.  Lots of leaks from the Obama economics team members both credited and un.

Here’s the money quote from Matt Yglesias:

 In general, the Obama administration stands out for having at times a weak grasp of the non-legislative functions of the presidency and doesn’t seem to spend much time worrying about Fed appointments or stimulative things executive agencies can do.

No, $#@*, Sherlock.  That was the number one reason why 18,000,000 of us voted for Clinton.  Obama hadn’t been in the Senate long enough to know where all of the bathrooms were much less run the executive branch.  With Clinton, not only would you have gotten someone who was more of an FDR style Democrat and had been around long enough to see the mechanisms of government working, you would have gotten a mentor thrown in for free!  But we’ve been over this again and again.  The Obama fanbase was simply wrong and ignored all evidence that the other candidate was the one they should have been supporting.

There’s a good reason why we shouldn’t give twerpy, sychophantic twenty something brats their own by-line in journals like The Atlantic.  Their overconfidence is a result of successful asskissing, not any particular genius or political insight. But I don’t want to turn this into a diatribe against Matt.  His record should speak for itself.  He was one of the guys who shoved Obama down our throats until we gagged.  Thanks a lot, Matt.  Want to make my COBRA payment for me and my kid in a couple of months when the money runs out?

Putz.

But wait!  There’s more.  Atrios (not a putz) at Eschaton has another link to a Geithner story.  It turns out that Geithner’s approach to the economy is going to be shaping the president’s campaign for next year.  His approach sounds an awful lot like “protect the holders of those toxic assets at all costs!”.  Isn’t that special??  I can’t wait for 2012.  The last time I took so much time off from work was when my daughter was born 15 years ago.  But it looks like we jobless can look forward to an indefinite period of underemployment and economic uncertainty for years to come, whether a Republican or Obama win in 2012.

If I were to write Obama’s performance review, I would give him a 2 and give him 6 months to turn it around or send him packing.

Many of us got “outstanding” and “exceptional” reviews in the year of our layoff and we still got shown the door.  There’s no excuse for retaining the poor performers in a time of layoffs when there are plenty of people who could perform the job better.

And here’s a little blast from the past for Anthony Weiner.  David Vitter gave a press conference the day he admitted to visiting a DC prostitute.  I can’t recall if he mentioned which brand of disposable diaper he wore but details like that are not important.

Showing your junk to the world is so high school, Anthony.  Nowadays, adolescents attend mandatory assemblies on the perils of sexting.  Just last season on Degrassi, Alli Bandhari sent a sext of her nekkid boobs to her boyfriend and that sucker was all over school before the end of the day.  (Brook records it on the DVR, why do you ask?)  Maybe Nancy Pelosi can add an assembly to her calendar.  But don’t resign over it unless Vitter goes first.  After all, sexting is just immature.  Prostitution is illegal.