The Hangover

By Kevin D. Williamson

Sunday, January 02, 2022

 

Happy New Year. About last night . . .

 

We have, in a way, been here before. The Covid-19 epidemic and the federal response follow a familiar pattern: A crisis emerges, extraordinary action is taken, that extraordinary action acquires interest groups who wish to see it become ordinary action, economic troubles inevitably follow, and sorting it all out gets pretty hairy pretty quickly.

 

Sometimes, this doesn’t go too badly. Consider the end of World War I, when many progressives desired to keep Woodrow Wilson’s “war socialism” as a permanent practice, giving the federal government broad managerial powers over both the economy and civil society. Washington had got itself a taste of real autocratic power, and wanted more. (Jonah Goldberg describes this seduction very intelligently in Liberal Fascism.) But Americans had had enough of it, and Warren G. Harding put a stop to it with his “Return to Normalcy.” But it wasn’t easy: The U.S. inflation rate had been above 17 percent during the war, and it was still above 15 percent in 1920. But as the United States transitioned from a war economy to a peace economy, there ensued a great deflationary recession, with the high wartime inflation being followed by steep deflation — of nearly 11 percent — in 1921. Discharged soldiers went looking for work in a flooded market, with wages stagnating or declining. The medicine was bitter — in 1921, defense spending was cut by a third and overall federal spending was reduced by 7 percent — but it largely worked, and the rest of the 1920s turned out to be famously prosperous.

 

The end of World War II came with some economic trouble, too: Dwight Eisenhower was as much of a return-to-normalcy guy as the country could have hoped for — he personified normalcy — but these transitions are never without agony, and the 1958 recession was a serious one.

 

Lyndon Johnson flooded the economy with money thanks to his two wars — the more expensive one in Vietnam and the less expensive (at the time) one against poverty — which helped to cause the painful inflation that persisted throughout the 1970s and into the first years of Ronald Reagan’s presidency. Reagan had the good sense and patriotism to take a political hit and stick with Paul Volcker’s painful anti-inflation program, and it drove his approval numbers lower than a snake’s belly in a wagon rut. If not for Reagan’s great political skill — and the roaring recovery — pursuing an intelligent anti-inflation policy might have ended his presidency.

 

Emergency. Emergency spending. Inflation. Recession. Recovery. The pattern is not difficult to discern.

 

Because our current tribal rage causes us to see everything in the dumbest possible binary terms, it is sometimes difficult to make the case that Covid-19 was a genuine crisis, that it required an extraordinary response, and that, at the same time, the crisis has been exaggerated, the response has overreached and over-persisted, and that an unpleasant process, something like the economic version of drug withdrawal, is now necessary.

 

The political problem is partly self-correcting. The Covid-19 spending measures were popular because spending is popular categorically. The people who were receiving supplemented and extended unemployment benefits were in themselves a highly motivated constituency working to secure their own benefits. But now that all that spending is supercharging inflation, the wage gains of the past few years are being reversed or entirely erased for many workers, especially those in lower-wage jobs. By some recent measures, real wages — meaning wages adjusted for inflation — are down year-over-year for lower-wage workers. Current policies are, in a measurable way, hurting the people they are meant to help.

 

This punishes everybody: U.S. productivity has just suffered its biggest decline since 1960.

 

There is no easy fix. The usual way to put a brake on inflation is to raise interest rates. That is a hard thing to do for the U.S. government, which is the most indebted organization in world history and already spends a substantial share of each year’s tax revenue on interest payments for prior years’ spending. Both the government and the broader economy have become very accustomed to ultra-low interest rates — free money, in effect — and both will have a tough time adapting to a different credit environment.

 

Prosperity will emerge — if we let it. But first, we have to do the hard part: reforming our public finances with an eye toward long-term stability and following a more sensible long-term monetary policy, thereby creating the conditions of stability and predictability in which sensible and profitable long-term investment is possible.

 

The hangover is coming. That’s the bad news. The good news is that hangovers end.

Things Could Be Worse: Some Thoughts for the New Year

By Kevin D. Williamson

Friday, December 31, 2021

 

This year, I will celebrate New Year’s Eve by keeping an earlier New Year’s resolution and going to bed at 9 p.m. I recommend it.

 

New Year’s Eve is the worst, anyway — even worse than Valentine’s Day when it comes to people desperately pretending to be having a good time. Spare yourself. I’m not saying you have to be a fuddy-duddy on the level I am (if you ever need a quick explainer on how to read lute tablature, I can help) — in fact, I’m not saying you have to do anything — but most of you will be happier if you skip the $1,000 table at the Hilton in Chicago, even if it does come with Red Bull as well as champagne. You can get a pretty good bottle of champagne for $100, have a glass at 8 p.m., and then — here is the important part — go to bed.

 

There are personal benefits to this, of course, but also a related political aspect. I don’t know about you, but most of the worst decisions of my life have been made after 9 p.m. Even if you are living that Eisenhower-era life and starting in with Canadian Club whiskey sours at 5:00, you probably aren’t going to get into too much trouble before 9:00. And as it goes for the citizen, so goes it for the nation. You know who liked to stay up all night dreaming of terrible policy ideas? Barack Obama. And, before him, Bill Clinton was famous for treating the presidency as though he were a college kid cramming for an exam, with all-night sessions powered by fast food and soda. Lyndon Johnson was a night owl.

 

George W. Bush? In bed by 9 p.m. John Quincy Adams? Early to bed, early to rise. Herbert Hoover, too. Calvin Coolidge, a model of conservatism, liked a nap:

 

Calvin Coolidge’s penchant for hourlong naps after lunch earned him amused scorn from contemporaries. But when he missed his nap, he fell asleep at afternoon meetings. He even napped on vacation. Tourists stared in amazement as the president, blissfully unaware, swayed in a hammock on his front porch in Vermont.

 

This, for many Republicans, wasn’t a problem: The Republican Party of the 1920s was averse to an activist federal government, so the fact that Coolidge wasn’t seen as a hard-charging, incessantly busy president was fine.

 

Biographer Amity Shlaes wrote that “Coolidge made a virtue of inaction” while simultaneously exhibiting “a ferocious discipline in work.”

 

Repeat: “This, for many Republicans, wasn’t a problem.” Those Republicans were the good kind.

 

Yes, sometimes Abraham Lincoln stayed up late. You would have had trouble sleeping, too, if you were in his place. But he was a 9-p.m.-er at heart, I think, who served the customary wine at official dinners but himself preferred plain water, because alcohol left him feeling “flabby and undone.” Having no taste for fanaticism, he was not a teetotaler but rather a man of restraint in these matters, like Saint Thomas More and the Count of Monte Cristo. Less fanaticism, more restraint, and more moderation — not the worst idea I have heard in 2021.

 

(Of course, Lincoln the businessman would have been happy to sell you a bottle of whiskey — he didn’t become a Republican by accident.)

 

Big, ambitious, utopian ideas take shape in the wee hours, as do their very near relations, the harebrained schemes. Karl Marx was a night owl. Adolf Hitler, too. Do you want to know what a great idea that comes to you at two o’clock in the morning looks like? This:

Early to bed, early to rise ought to be understood as part of what George Will calls the “conservative sensibility.” A sensibility is not an ideology or a system. It isn’t even, strictly speaking, an idea. It is something in that little corner of the soul that speaks to you in the voice of Dwight Eisenhower, saying: “Get a job. Save some money. Pull your pants up. Look after your family. Don’t get carried away. Be grateful for what you have. Things could be worse — see to it that you do not go out of your way to make them so.”

 

There was a time when Republicans would say, “If everybody else was jumping off a bridge, would you follow?” Now, if everybody is jumping off a bridge, Republicans say: “The people have spoken!” And over the edge they go.

 

The Republican Party in particular may be a lost cause, but I do have some hope that the American people at large still may be able to recover some of that conservative sensibility. My read on the populist madness of recent years is that Americans have come to feel that many of the important things in life are beyond their control, and they are desperately trying to reassert that control. I do sympathize, but, with age and experience, I also have come to understand that many of the most important things in this world never were within my control in the first place, and the words of the hymn “I Can’t Even Walk” mean more to me than they used to. But there are some things that are in my control, and I mean to exercise that control where I can.

 

As William F. Buckley once put it: “I will not willingly cede more power to anyone, not to the state, not to General Motors, not to the CIO. I will hoard my power like a miser, resisting every effort to drain it away from me. I will then use my power, as I see fit. I mean to live my life an obedient man, but obedient to God, subservient to the wisdom of my ancestors; never to the authority of political truths arrived at yesterday at the voting booth.”

 

Keeping an early bedtime is a small personal assertion, maybe even a trivial one. But, as it turns out, keeping Winston Churchill’s daily personal routine doesn’t make you Winston Churchill. And so I currently am very much inclined toward conserving — time, attention, energy, resources, anger — having spent too many years in an ongoing New Year’s Eve celebration, convinced (or almost convinced) that I was having a good time. So I will do what I can do, and take such modest improvements as are available where I find them. I have never understood those strange people who insist they have “no regrets” and have always assumed that they either are too stupid to understand what it is they should regret or that they simply have never really had anything to lose. Lost time is a thing worth regretting, and nations have their poison years just as individuals do. If we are to commit ourselves to a New Year’s resolution, perhaps it should be to work to have no more of those lost years, to do what we can where we can while we can.

C.A.A. Returns

 The C.A.A. has returned from vacation. Regular updates resume today. 

The System Worked

By Kevin D. Williamson

Tuesday, December 21, 2021

 

The Left loves “the masses” — at least, in theory. As a matter of historical fact, leftist regimes around the world spent most of the 20th century putting “the masses” into camps or intentionally starving them to death or, from time to time, eating them (“The incidents reported from Guangxi were apparently the most extensive episodes of cannibalism in the world in the last century or more”) to make a political point, and they have not done a hell of a lot better in the 21st century.

 

(“Te Occidere Possunt Sed Te Edere Non Possunt Nefas Est.” Nobody told the Red Guards.)

 

But there are no “masses.”

 

Not in the United States, anyway. The American people are not an undifferentiated blob of interchangeable individuals or interchangeable communities. Time, mass media, and mobility have ensured that the states are not as different today as they were when the Constitution was drafted, but life in rural West Virginia really is quite different from life on the Upper West Side or life in Echo Park or life in Bountiful, Utah. I am not sure that there are “masses” in Mexico, India, or China, either, however much politicians of a certain demagogic sort may like to appeal to the masses and their grievances.

 

There is genuine diversity in American life, and the splendid array of American communities and their particular interests matter, irrespective of whether 50 percent plus 1 of the total American voting population says otherwise. Everybody understands this when it is his own interest on the line, and everybody pretends not to understand this when it is some rivalrous interest in question. “Black Lives Matter” is a meaningful statement because black Americans have particular interests, particular experiences, and particular histories all their own; whatever the misdeeds of the organization calling itself Black Lives Matter, the sentiment itself is no more exclusionary than the idea that we should maintain such organizations as the League of Women Voters, the Texas Asian Republican Club, the Fellowship of Christian Athletes, or Jews for the Preservation of Firearms Ownership.

 

Our law recognizes these particularities in many different ways, some prudent and some less so. We have civil-rights laws that were intended mainly to help African Americans secure their basic rights and interests in practical ways that probably would have been impossible without federal intervention; we maintain a contingency plan for conscripting men into military service but not women; farmers receive tax exemptions not available to other businesses; churches receive exemptions from certain employment laws; we offer many different kinds of benefits and subsidies to small businesses that are denied to large ones. We have both urban-development and rural-development programs in government because these communities do not have identical interests or identical needs.

 

Protection for this diversity is written into our Constitution, and it informs the fundamental shape and organization of the federal government. No majority, no matter how large, gets to tell you what to teach in your church or what to publish in your newspaper. No majority gets to use the law to single you out because you are black or an immigrant. Our system is by no means perfect: Well-intentioned civil-rights practices are why we now have men competing in women’s college sports, for example, and equally well-intentioned accommodations such as bilingual-education mandates have blunted valuable spurs to immigrant assimilation. (Diversity is not the only value.) Passing civil-rights laws has not as a practical matter solved the problems those laws were meant to address. God knows we have problems. But the American approach has proved extraordinarily resilient, strong and flexible at the same time.

 

The United States and Switzerland — the world’s oldest democracy and the world’s second-oldest democracy, respectively — have very different governments and very different political cultures, but they have one important thing in common: federalism. Switzerland’s “double majority” system requires that big social changes move forward only when there is substantial consensus, as indicated by winning the votes of a majority of the people as a whole and a majority of the votes in a majority of the cantons. The U.S. Electoral College works on the same principle: To be elected president, a candidate needs to win not simply a majority of the entire voting population but a majority of the votes in a certain number of states, weighted by population. This means not only that a handful of big states cannot simply sweep aside the votes of the smaller states but also that a candidate who does not appeal to a sufficient diversity of constituencies in the various states will not win in some circumstances even when he secures a majority of the total vote. American federalism and Swiss federalism even produce many of the same complaints, e.g., that the system amplifies the power of people in less densely populated rural areas, who tend to be conservative, at the expense of people in the big cities, who tend to be more progressive.

 

(Similar procedures and institutions exist on a more limited scale in a few other countries, such as Germany and Australia.)

 

Which brings us to Joe Manchin and the grievously misnamed Build Back Better bill.

 

As my friend Charles C. W. Cooke points out, Senator Bernie Sanders’s constant whining that “one senator” or two should not be able to put a halt to the president’s legislative agenda is pure illiteracy, beginning with the fact that it is not one senator blocking Build Back Better — it is 51 senators, at least. Cooke writes:

 

In a 50/50 Senate, the “problem” that “one senator is able to hold up what the president wants!” can only be “fixed” by (a) passing bills with a minority of senators, (b) allowing only majority party to vote, (c) forcing senators to vote with their party — all of which are crazy.

 

As I am sure Charlie and I will have a chance to discuss on our Mad Dogs & Englishmen podcast, what Senator Sanders is up to here is not really constitutional analysis — it is base demagoguery. (And a bit of “mood affiliation,” which I will get to in a minute.) But Senator Sanders does have a point, albeit a point he does not quite understand: The Senate is, in an important way, not only undemocratic but antidemocratic. That is how it is meant to be — and we would be better off, both as a country and as a people trying to practice an intelligent form of liberal democracy, if the Senate were even more undemocratic and antidemocratic than it is.

 

Build Back Better would be a bad piece of legislation in the best of times. But these are not the best of times: We are a country that is facing a genuine inflation crisis — not of Argentine or Zimbabwean proportions, at least not yet, but a crisis nonetheless — and a country that is dancing on the precipice of a sovereign-debt crisis, as well. This isn’t Chicken Little stuff, and I don’t want you to think that the country is going to look like The Walking Dead the day after tomorrow. But here are the facts: Inflation is at a 40-year high, and interest payments on the debt already take up 15 percent of all federal tax revenues. Interest rates are very low by historic standards, and the main way you work to control inflation is by raising them. And, ultimately, interest rates are not under government control — they are under the control of investors in the debt market, who decide what rates they will lend at and what rates they won’t. Interest rates could easily be three to four times what they are today in a few years, meaning that interest payments could consume somewhere between half and two-thirds of all federal tax revenue, necessitating a radical and immediate restructuring of the federal government and its finances — that is the risk we are faced with.

 

A gigantic spending binge such as Build Back Better would tend to make both inflation and the debt situation worse. It would raise inflation by flooding the economy with more money (mostly put indirectly into the pockets of well-connected political constituencies), and it would worsen the debt because much of that money would be borrowed. The rosy projection is that BBB would add hundreds of billions of dollars to the debt, and the more realistic projections have it in the trillions.

 

Senator Manchin has been inundated with claims, many of them suspect, that BBB is overwhelmingly popular with the American people. It may be. But even if it were, it would still be a terrible piece of legislation — and, sometimes, political leaders are called upon to lead rather than act as their voters’ factota. And however BBB stands with the public in general, it is not especially popular with the people of West Virginia, and it is to them — not “the masses” — that Senator Manchin is ultimately accountable.

 

One way of thinking about the apparent failure of BBB is that it could not pass the double-majority test. The proposal had substantial general support but also inspired many pockets of urgent and persistent opposition from communities who were not willing to have this imposed on them by a group of senators who are, as Charlie notes, a minority, even if they are a majority of the majority party. There simply is not the wide and deep consensus that should be present when advancing wide-ranging legislation of this kind. The president, of course, has very little role in the crafting of legislation and no vote in Congress — but he does have the ability, and at times the obligation, to work toward building the consensus necessary for major reforms and important pieces of legislation. President Biden can criticize Fox News and talk radio and implacable Republicans, and he wouldn’t be wrong about any of that, but he would be admitting that he simply isn’t an effective enough leader to show himself more than the equal of Tucker Carlson or Madison Cawthorn. I am all for a smaller presidency, but a smaller president should have smaller ambitions — he should make some effort to accommodate the reality of his situation.

 

President Biden and other Democrats are always looking wistfully for the second coming of Franklin Roosevelt. But what Democrats really need is someone more along the lines of Lyndon Johnson, who was gross and venal but who had a real gift for plumbing the outer limits of what was politically possible and then getting Congress to meet him there. (That he sometimes did this in the service of unwise legislation does not in any way diminish the gift.) And President Johnson did bigger things than BBB. Much bigger.

 

If your whole political agenda goes off the rails because you cannot bring around one mulish senator from your own party, then perhaps you need to rethink your political agenda. You might even think about how you might win the support of six or seven senators from the other party. Don’t tell me they can’t be had — Ted Cruz came around to champion the cause of a guy who called his wife ugly and suggested that his father had been involved in assassinating President Kennedy. Lindsey Graham is . . . Lindsey Graham. These aren’t exactly Doric columns of unmovable moral commitment we’re talking about here.

 

These are politicians, and the game is politics. If you can’t politics your way into getting something done in this Senate, that’s on you, Democrats — not the Constitution.

 

Words about Words

Ten years ago, the economist and polymath Tyler Cowen described the “fallacy of mood affiliation.” Mood affiliation distorts our reasoning by subordinating facts and logic to moods, sometimes vague, that impose a kind of psychological meta-narrative on our understanding of events. An example from Cowen: “People who see a lot of net environmental progress (air and water are cleaner, for instance) and thus dismiss or downgrade well-grounded accounts of particular environmental problems. There’s simply an urgent feeling that any ‘pessimistic’ view needs to be countered.” Another, more familiar example: “People who see raising or lowering the relative status of Republicans (or some other group) as the main purpose of analysis, and thus who judge the dispassionate analysis of others, or for that matter the partisan analysis of others, by this standard. There’s simply an urgent feeling that any positive or optimistic or deserving view of the Republicans needs to be countered.” Etc. “In the blogosphere,” Cowen writes, “the fallacy of mood affiliation is common.”

 

What has changed since Cowen first wrote this is that writers for major publications and, increasingly, political figures now simply lead with the mood. I think this is an example of the prose style, and the cognitive style, of social media infiltrating print journalism, political rhetoric, and the rest of discursive life.

 

An example: Charles M. Blow writes in the New York Times: “I’m Furious at the Unvaccinated.” That’s the headline. In the column, Blow recounts his failed effort to nag a friend of his into getting vaccinated. “I am disappointed, and I am angry, not just with my friend but with all the people who are choosing not to get vaccinated.”

 

What I take from this is that Charles Blow and the people who write his headlines believe that Charles Blow is a very big deal, indeed, such that his internal emotional situation is the stuff of New York Times headlines. “Journalist Is Angry and Disappointed.” Well. I suppose there are insurance agents and farmers and elderly men in rocking chairs who are angry and disappointed about all sorts of things. But nobody would think that makes for headlines.

 

Is there really no more to the horrible Omicron news than how Charles Blow feels about it? I think there is. But journalists increasingly act like they are running for office, asking their constituents to resonate with their moods and prejudices. It is a ritual of hating together. Hence the headline.

The Snoot Party Goes to War

By Kevin D. Williamson

Sunday, December 26, 2021

 

The Democrats love the poor. The Democrats hate the poor.

 

And the poor in West Virginia? They’re at the bottom of the bucket, as Democrats see things.

 

Senator Joe Manchin, the moderate Democrat from West Virginia who is one of the last of that breed, has derailed Joe Biden’s beloved Build Back Better bill, a slop-bucket of progressive wish-fulfillment that would add trillions in new spending to our already-bloated federal budget and pile much more debt upon our already-considerable national heap. Senator Manchin thought it was a bad package, though he supported some of what was in it, and West Virginians thought it was a bad package, though they supported some of what was in it, and so Senator Manchin announced — on Fox News, in an extra “f**k you” to Chuck Schumer et al. — that he would oppose the bill. Because Democrats and Republicans both have rejected the notion of consensus-building and bipartisanship, every Senate Republican opposes the scheme, which means that the Democrats need every Democratic vote to pass the bill in the evenly split Senate.

 

Senator Manchin’s willingness to break with his party makes him, for the moment, the most powerful man in Washington after the maître d’ at le Diplomate. (Somewhere in the Senate, there must be at least one Republican who is smart enough to realize that he could be the most powerful man in Washington, after the maître d’ at le Diplomate, if he were willing to do the same.) It also makes him the man Democrats hate most — at the moment, anyway; Democratic hatred is an urgent and plastic thing.

 

But like the unhappy worker who cannot face off against his overbearing boss and so instead goes home to yell at his wife and kick the dog (as Sigmund Freud once had it), progressives from Hollywood to Washington to whatever abandoned gopher hole Robert Reich calls home have decided to lay into the people of West Virginia. As Isaac Schorr already has reported here, the noted political philosopher Bette Midler and her friends at Occupy Democrats denounced West Virginians as illiterates (the Mountain State has a higher literacy rate than New York, California, or New Jersey), Ilhan Omar suggested that Senator Manchin’s vote is the result of corruption — a serious charge for which she should be made to answer — and Reich offered this indictment: “Let me remind you that a full quarter of West Virginians 65 and older have no natural teeth.” Toothless hillbillies — who doesn’t love a classic? In fact, the share of West Virginians over 65 without any remaining teeth is not far off from the national average; the state’s slightly elevated rate of geriatric toothlessness is almost certainly due to the fact that it has a large population of people over 75 (who have a very high rate of total tooth loss), being the nation’s third-most-elderly state. But facts don’t matter much when you’ve worked up a good head of hate-steam.

 

I know as well as anybody that poor, rural, white America has its problems. But I do not believe for one hot second that Ilhan Omar or Robert Reich knows one damned thing about them, or cares to learn. Why would they? Senator Manchin is about as far to the political left as today’s West Virginia is going to go. Owsley County, Ky., home of the poorest white people in America, is overwhelmingly Republican, and Donald Trump got eight times as many votes as Joe Biden did there in 2020 — Trump did slightly better in San Francisco than Biden did in Owsley County. There’s a little factoid to meditate upon.

 

The most important domestic political development of the 21st century so far is the class-reversal of the Republican and Democratic parties, a trend that began in the 1990s with Bill Clinton and now has reached a state of genuine polarization. Democrats, once the party of poor farmers and working-class “white ethnics,” as we used to call them, have become the party of affluent, educated, metropolitan and suburban professionals — the people who once were critical to the Republican coalition. One notable barometer, the five counties of Southeastern Pennsylvania, for years exemplified a national pattern: Philadelphia was overwhelmingly Democratic, and the four suburban counties around it were overwhelmingly Republican; now, you don’t hit Republican territory until Lancaster County, which is both Amish country and heroin country, with almost 150 overdose deaths in 2020.

 

As far as today’s Democrats are concerned, voting Republican is just one more pathology that afflicts the toothless hillbillies of their imagination. They are perplexed — or at least pretend to be perplexed — by the fact that there are poor and struggling Americans who do not instinctively turn to welfare-statism as the answer to their problems, who are uneager to sacrifice either their values or their liberties in exchange for a government check. Democrats have responded to this by elevating the needs of the relatively well-off to the top of their agenda, which is why they spend so much time talking about the terrible burden of student loans for young lawyers and underemployed Haverford graduates. You won’t hear them offer anything like a serious solution to the public-education crisis in Los Angeles or Milwaukee — those well-paid teachers are a core part of the Democratic base, and semi-literate high-school dropouts do not vote in large numbers.

 

It is likely that Senator Manchin either will become a Republican or will be replaced by one, eventually. At only 74 years of age, he is a spring chicken by the standards of current Democratic leadership: President Biden is 79, Nancy Pelosi is 81 (her hair is 46), and Dianne Feinstein is within spittin’ distance of 90. But he isn’t going to be in the Senate forever. Because the Senate gives equal representation to the less-populous rural states and the densely populated urban states, it is always going to be a problem for Democrats. Strangely, Democrats seem, at the moment, intent on making it a bigger problem for themselves. Further shrinking the universe of possible electoral coalitions may pass for smart in the great echoing expanse of insipidity between Bette Midler’s droopy old ears, but it is a losing strategy.

 

Somewhere, Mitch McConnell is cracking a bloodcurdling smile.

Stick It to Vlad

By Kevin D. Williamson

Tuesday, December 28, 2021

 

Just as the family budget is not really a very good model of the national economy, schoolyard rules are not normally the best guide for international relations. That being said, sometimes the best thing for a bully is giving him a bloody nose.

 

With China having comprehensively eclipsed Russia as the baddest bad actor among nation-states on the world stage, Vladimir Putin is begging for attention from the West. Perhaps it is time to give him some.

 

Putin, already having invaded and annexed part of Ukraine in 2014, has threatened further war on Ukraine and attempted to intimidate the country and its Western allies with a massive troop buildup throughout December. Now, he demands that the United States and its allies promise that there will be no expansion of the North Atlantic Treaty Organization (NATO), ever, as the price of peace with Russia.

 

NATO has been slow-walking Ukraine’s membership since the 1990s. But the country is, at least formally, on track to become a full NATO member. In 2008, NATO and Ukraine agreed to an accession plan, with NATO secretary general Jens Stoltenberg specifically affirming that Russia would not be permitted to veto Ukraine’s membership. As recently as June of this year, NATO reiterated its commitment to Ukraine. And now Putin demands that which NATO has specifically denied him: veto power over NATO membership decisions.

 

Because we are so accustomed to outrages from Russia, we do not seem to really appreciate how outrageous this is. Ukraine is a sovereign nation that can decide for itself which international organizations to join; NATO is an organization of sovereign states, including the United States, that can decide for itself what its policies will be and to whom it will offer membership. Russia is a third-rate gangster state whose idiotic policies have immiserated its people. In spite of its petroleum wealth, Russia’s GDP/capita is half of Lithuania’s, Latvia’s, or Slovakia’s, a third less than Poland’s, and below that of China, Panama, or Costa Rica. Its record of barbarism and inhumanity at home is well-attested, and its penchant for violating the sovereignty not only of its near neighbors but also that of countries such as the United Kingdom (where it has carried out assassinations) and the United States (where it has attempted to monkey with elections) marks it as a particularly egregious malefactor.

 

The Biden administration talks a good game about strengthening the trans-Atlantic alliance, but it has, in fact, done at least as much to aggregate U.S.-European alienation as the Trump administration did, confusing — and endangering — our allies with its headlong and unilateral evacuation from Afghanistan and insulting them with its clumsy and undiplomatic rollout of AUKUS. It is, for this and other reasons, in a poor position to do what it needs to do, which is to convene an extraordinary NATO summit and begin the process of formally admitting Ukraine to the alliance.

 

And maybe someone over in Antony Blinken’s shop could remind the boss that Poland is a full NATO member, one that currently is being subjected to a destabilization campaign by Belarus, where the regime of Putin dependent Alexander Lukashenko is recruiting refugees and immigrants from the Middle East and Africa to come to his country and then marching them illegally into Poland. This is if not quite an act of war in the conventional sense then an act of Mark Leonard’s “unpeace,” weaponizing refugees and immigrants in a campaign of soft social warfare. This ought to be understood — and responded to — as an act of military aggression against a NATO member.

 

The Europeans understand that they need to develop a more robust and unified foreign policy and a more credible self-defense capability. But they currently view the United States as an erratic and unreliable partner — at best. Repairing and reinvigorating that relationship is the work of years and decades, not something that can be accomplished at a single summit or with a few conciliatory speeches.

 

A cursory telephone call to Olaf Scholz, the new German chancellor, is not going to get it done. The Biden administration needs to get serious — and get serious now — about rebuilding the Atlantic alliance, with an eye not only toward Russian shenanigans in the here and now but also toward the imminent confrontation with China. That is, unless we are to conclude that all that happy talk about diplomacy and responsible internationalism was just a campaign talking point.

The Long Run Is Here

By Kevin D. Williamson

Sunday, December 19, 2021

 

John Maynard Keynes, progressives’ favorite economist, famously observed: “In the long run, we are all dead.” Lord Keynes had the good sense to die in 1946, when the credibility of his policy thinking was at its height. The rest of us are left to meditate on a proverb dear to Milton Friedman, conservatives’ favorite economist: “There is no such thing as a free lunch.”

 

The future is now, and it is not entirely satisfactory. The long run kind of stinks.

 

Here is a guide for predicting the future: The future is going to look a lot like the present, and the few things that are radically different are going to be the things you were least expecting. Ridley Scott’s Blade Runner was made in 1982 and set in 2019. In that version of 2019, we had flying cars and space colonies and blond robot super-soldiers, but there were no smartphones, the computers all looked like one of those Mattel handheld-football games we all had back in the late 1970s, there were telephone booths, and everybody still smoked and kind of looked like they were characters from a Mickey Spillane novel. In real-world 2019, mostly only poor people and old people smoked, there were no phone booths, our self-driving cars were still kind of buggy, and social media — basically a telegram but faster and not private, which is somehow a world-changing technological innovation — had become the opiate of the masses, except for those masses whose opiate was still opiates.

 

Some things about our semi-dystopian present were predictable. The faster and farther people travel, the faster and farther the diseases we carry will travel. (The same is true for trees, which are not really supposed to travel much at all.) If a government continues to pile up debt at a rate that far outpaces the growth of the national economy, it is going to have a debt crisis. If you cripple law enforcement, you’re going to get more crime. If you devalue work and subsidize unemployment, it will be harder to get people to work, especially in low-status jobs.

 

There is no such thing as a free lunch. Somebody always pays.

 

One of the ideas most closely associated with Milton Friedman is the “quantity theory of money.” If that sounds like econo-gobbledygook, don’t worry. All the “quantity theory of money” really means is that the familiar law of supply and demand that applies to other goods and services also applies to money. (Of course there are complicating factors, if you really want to dig into them.) If the law of supply and demand applies to money itself, then you can make some reasonable predictions: If you increase the supply of money disproportionately to the growth of the economy, then the price of money — meaning the value of a dollar, in our case — goes down. If you decrease the supply of money substantially (for instance, by raising interest rates and thereby reducing the amount of credit available), the price of money goes up. You’d think everybody would like that, but, of course, there are winners and losers in every economic tradeoff: If the value of the dollar goes up, that makes U.S. exports less competitive in world markets, and it also reduces the dollar value of assets such as houses and investment instruments.

 

When house prices or Apple shares are going up, then the price of houses or Apple shares is increasing in terms of dollars. Another way of looking at that is that the price of a dollar is declining in terms of houses or Apple shares. That is one of the reasons why inflation hawks keep track of gold prices — not because they are looking to buy jewelry, but because of what the price of gold tells us about the value of a dollar. We have some historical experience with this, from modern-day Zimbabwe and Argentina to revolutionary-era France to 14th-century Africa, when King Musa I of Mali, probably the richest man in the world at the time, spent so lavishly and gave away so much gold on the way to Mecca that he caused a collapse in the price of gold (the nearly universal currency of the time) that lasted for more than a decade.

 

Increasing the supply of money — and, thereby, reducing the value of money — is what is meant by “inflation”: You inflate the money supply. That may result in a general rise in prices, which we currently are seeing, but it may also result in price increases that are concentrated in a few sectors. In the years before the Covid-19 crisis, we saw a fair amount of that latter phenomenon, sometimes known as “asset inflation.” Starting with the turn-of-the-century recession and 9/11, we have had a pretty loosey-goosey monetary policy, which got loosier-goosier during the 2008–09 financial crisis. For decades now, we have responded to every scraped knee in the economy with freehanded spending of cheap money. And for the most part, Americans — the ones who matter, anyway — loved it. They loved it because they owned a lot of assets, and so asset inflation drove up the values of their houses and their stock portfolios. The value of the stuff they owned rose more quickly than the price of the stuff they bought, so they were, in real terms, richer. The people who are mystified by the lack of “affordable housing” in much of the United States do not seem to understand that driving up the price of houses has been a bipartisan policy program for decades.

 

The Covid-related economic convulsions — the deep, sharp recession of the shutdown era and the lingering effects of supply-chain disruptions, which probably will last years — changed the game. After years of benign consumer-price inflation and rising asset prices, we started to see the kind of inflation that ends political careers: higher gas prices, higher food prices, higher utility prices. But that cheap-money part was always going to end and end badly, Covid or no Covid: Housing prices can’t rise faster than wages forever — eventually, those richer older people who have been enjoying the boom will be outnumbered by younger, poorer people who can’t afford a decent house. For years, we used cheap credit to camouflage the high prices of houses, cars, and education — Never mind the total tab, just tell me the monthly bill! — another one of those great ideas that works until it doesn’t.

 

Joe Biden and congressional Democrats are doing their best to make inflation worse by spending vast sums of money to reward key political supporters and to try to buy themselves some love before the midterms, currently looking like they will be a slaughter for their party. (The Republican polling advantage today is stronger than it has been in 40 years — Democrats should think about how much people must hate them to vote for the party of Marjorie Taylor Greene and Ivermectin junkies.) But the way you end inflation — the thing you end up doing once all the painless options have been tried and failed — is raising interest rates. You might remember that back in 2008, we raised interest rates a smidgen, which caused ridiculously inflated housing prices to come a little closer back to Earth — and sparked a worldwide economic emergency. Raising interest rates is going to play havoc on the cheap-credit model of selling houses, cars, and college educations, along with much else. And it could be very hard for the biggest debtor of all: the U.S. government, which already spends more than half a trillion dollars a year just on interest payments. We spent $522,767,299,265.34 on interest payments in 2020, with interest rates that were low by historical standards. If interest rates start to move back toward their historic average, that number could easily double or treble — or much worse.

 

This is the predictable stuff. Nobody saw Covid-19 coming (though I suppose there is a reason we’ve had all those zombie movies and zombie television series for so many years — a kind of folk intuition, perhaps), but, this stuff, we see it coming. You can dick around with different economic models and debate sticky prices and the velocity of money and all that stuff, but that’s just Wile E. Coyote out there in the Arizona desert insisting that the anvil that’s about to fall on his head weighs only 100 pounds instead of 200 pounds. Alexandria Ocasio-Cortez and Bernie Sanders may insist that there is no anvil, but sensible people can foresee that the big heavy 50c-Rockwell anvil-shaped hunk of steel with “Acme Anvil Corp.” engraved on the side and hurtling toward our delicate little American skulls is probably — wild guess! — an anvil.

 

The long run is here.