Has U.S. Democracy Been Trumped?

[Winstonm]

Me, too. Trump never gives in, he digs in deeper. Sharpiegate was the clearest example -- any sane person would just admit "oops", but Trump's narcissism just wouldn't allow that. There's no way he would give in to an attempt to oust him, especially if he thinks the Republican Senate will save him.

 

Except if he feels shame (the kryptonite of narcissists) for facing impeachment.

[y66]

From William K. Rashbaum and Benjamin Weiser at NYT:

 

A federal judge on Monday rejected a bold argument from President Trump that sitting presidents are immune from criminal investigations, allowing the Manhattan district attorney’s office to move forward with a subpoena seeking eight years of the president’s personal and corporate tax returns.

 

The ruling issued by Judge Victor Marrero of Manhattan federal court does not mean that the president’s tax returns will be turned over immediately. Mr. Trump’s lawyers quickly appealed the decision, and the appeals court agreed to temporarily block the order.

 

The judge’s decision came a little more than a month after the Manhattan district attorney subpoenaed Mr. Trump’s accounting firm, Mazars USA, for his personal and corporate returns dating to 2011. The demand touched off a legal showdown that raised new constitutional questions and drew in the Justice Department, which supported the president’s request to delay enforcement of the subpoena.

 

Mr. Vance’s office has been investigating whether any New York State laws were broken when Mr. Trump and his company reimbursed the president’s former lawyer and fixer, Michael D. Cohen, for payments he made in the run-up to the 2016 election to the pornographic film actress Stormy Daniels, who had said she had an affair with Mr. Trump.

 

Mr. Trump has denied having an affair with Ms. Daniels.

 

Mr. Trump’s lawyers sued last month to block the subpoena, arguing that the Constitution effectively makes sitting presidents immune from all criminal inquiries until they leave the White House. The lawyers acknowledged that their argument had not been tested in courts, but said the release of the president’s tax returns would cause him “irreparable harm.”

 

In his 75-page ruling, Judge Marrero called the president’s argument “repugnant to the nation’s governmental structure and constitutional values.” Presidents, their families and businesses are not above the law, the judge wrote.

 

A lawyer for the president and a spokesman for the Manhattan district attorney, Cyrus R. Vance Jr., each declined to comment.

 

On Monday, a lawyer for Mr. Trump asked the appeals court to block the subpoena until it hears the whole case, plus an additional week to give the losing side time to ask the United States Supreme Court to hear the arguments.

 

“This case presents momentous questions of first impression regarding the presidency, federalism and the separation of powers,” the lawyer, Patrick Strawbridge, wrote.

 

Mr. Vance’s office had asked Judge Marrero to dismiss Mr. Trump’s suit, saying a grand jury had a right to “pursue its investigation free from interference and litigious delay” and rejecting his claim to blanket immunity. The judge was appointed by President Bill Clinton.

 

Mr. Trump’s lawyers have called the investigation by Mr. Vance, a Democrat, politically motivated. Mr. Vance has accused the president and his team of trying to run out the clock on the investigation.

 

Last week, lawyers with Mr. Trump’s Justice Department jumped into the fray, asking the judge to temporarily block the subpoena while the court takes time to consider the “significant constitutional issues” in the case.

 

The Justice Department, led by Attorney General William P. Barr, did not say whether it agreed with Mr. Trump’s position that presidents cannot be investigated. But, citing the constitutional questions, the department said it wanted to provide its views. A spokeswoman for the department declined to comment on the ruling Monday.

 

The Constitution does not explicitly say whether presidents can be charged with a crime while in office, and the Supreme Court has not answered the question.

 

Federal prosecutors are barred from charging a sitting president with a crime because the Justice Department has decided that presidents have temporary immunity while they are in office.

 

But in the past, that position has not precluded investigating a president. Presidents, including Mr. Trump, have been subjects of federal criminal investigations while in office. Local prosecutors, such as Mr. Vance, are also not bound by the Justice Department’s position.

 

As part of a temporary deal reached last month, Mr. Vance’s office agreed not to enforce the subpoena until two days after Judge Marrero issued a ruling, which would give Mr. Trump a chance to appeal if he lost. But that agreement was to expire at 1 p.m. on Monday.

 

The president and his lawyers have fought vigorously to shield his tax returns, which Mr. Trump said during the 2016 campaign that he would make public but has since refused to disclose.

 

Mr. Trump’s lawyers have sued to block attempts by congressional Democrats and New York lawmakers to gain access to his tax returns and financial records. They also successfully challenged a California law requiring presidential primary candidates to release their tax returns.

 

If Mr. Vance ultimately prevails in obtaining the president’s tax returns, they would not automatically become public. They would be protected by rules governing the secrecy of grand jury investigations unless the documents became evidence in a criminal case.

 

Mr. Trump’s accounting firm, which he sued along with the district attorney’s office to bar the company from turning over his returns, reissued the statement it released nearly three weeks ago when the lawsuit was filed, saying it “will respect the legal process and fully comply with its legal obligations.”

 

Edit via Bloomberg: "Trump immediately appealed and in less than two hours won a delay to give the federal appeals court in Manhattan time for expedited review. The delay postponed what would have been a Monday afternoon deadline for Mazars to begin turning over the records to prosecutors."

[Winstonm]

Amazing. When you add this to the Rick Perry led plan to take over the board of Ukraine's oil company, it begins to look like the grand plan is to create a Russian-style American oligarchy of the right.

 

After his arrest, in Miami, Zarrab hired some of the most expensive lawyers in New York. They tried to secure a comfortable bail arrangement—and failed. They then sought to have the case thrown out entirely, and failed at that, too. For a time, it looked as though the Zarrab case was headed for trial. Then, last month, came several dramatic developments. Zarrab fired most of his lawyers and hired Rudy Giuliani, a confidant of President Trump, and Michael Mukasey, the former U.S. Attorney General. Then Trump fired Bharara, the prosecutor who indicted Zarrab in the first place. With a legal team friendly to the President in place, and a hostile prosecutor out of the way, Zarrab may be hoping for a sweet deal from the prosecution. It has since been revealed that Giuliani and Mukasey travelled to Turkey in February to meet with Erdoğan about the case—another of Zarrab’s lawyers said that they were seeking a “diplomatic solution” to the situation.

 

Are we truly all post-Soviets now? Is corruption our new norm?

[Winstonm]

"When I die, I may not go to heaven" by Tanya Trump

 

When he dies Trump may not go to heaven

abandoning allied Kurds is a sin

So when he dies, just write it off his taxes

as a gift to his pal Erdogan

[Winstonm]

https://www.sacbee.com/opinion/editorial-cartoons/jack-ohman/article235887622.html

[Chas_P]

When he dies Trump may not go to heaven

abandoning allied Kurds is a sin

So when he dies, just write it off his taxes

as a gift to his pal Erdogan

 

I nominate Winston for Poet Laureate of the WC.

[y66]

Does Donald Trump Know What His Sysria Policy Is? from the Editorial Board at NYT:

 

American diplomats thought they had negotiated a solution to a seemingly intractable problem. The United States needed Kurdish-led forces in northern Syria to face off against remnants of the Islamic State. But Turkey, a NATO ally, saw those same Kurds as terrorists, allied with separatists inside Turkey.

 

To prevent a Turkish invasion, the three sides — the United States, Turkey and the Kurds — agreed to five-mile-wide safe zones along the border with Turkey, in Syria. Americans would patrol alongside Turkish forces, and the Kurds would dismantle fortifications in those areas that were designed to defend against a possible Turkish incursion. Turkey would also join American-led air operations against Islamic State militants. The deal would put a strain on the 1,000 or so American troops stationed in the region, but it would protect the Kurds in northern Syria and maintain pressure on the Islamic State.

 

President Trump let all that be destroyed when, succumbing to pressure from President Recep Tayyip Erdogan of Turkey, the White House announced that Mr. Trump would not stand in the way of a Turkish invasion to expel Kurdish forces from the border region. The language of the announcement made it seem as if he was even endorsing the move.

 

Even if the Turks do not invade — and while the president’s tweets on Monday indicated he might be rethinking his green light to the Turks, there were reports that attacks had already begun — the decision may destroy any trust the Kurds, America’s crucial partner in Syria, had left. It could also threaten the fight against ISIS.

 

Mr. Trump appears once again to have acted impulsively, in this case after a phone call with Mr. Erdogan. He blindsided officials at the Pentagon and the State Department and kept Congress and the allies in the dark. Administration national security officials have argued forcefully for maintaining a small troop presence in northeast Syria to continue pursuing the Islamic State and as a counterweight to Turkey and Syria’s Russian and Iranian allies. Mr. Trump’s determination to withdraw those remaining troops led to the resignations of former Defense Secretary Jim Mattis and the special envoy to the coalition fighting ISIS, Brett McGurk, last December.

 

Mr. Trump’s announcement and tweets infuriated conservative allies, including the Senate majority leader, Mitch McConnell, and Senator Lindsey Graham.

 

“The Kurds were instrumental in our successful fight against ISIS in Syria,” tweeted Nikki Haley, Mr. Trump’s first ambassador to the United Nations. “Leaving them to die is a big mistake. #TurkeyIsNotOurFriend.”

 

By midday Monday, the Pentagon was trying to contain the damage by announcing that it and the president had made clear to Turkey “that we do not endorse a Turkish operation in northern Syria.” The statement added that American military forces “will not support or be involved in any such operation.”

 

The president himself expressed second thoughts, which were, in their own way, even more jarring.

 

“As I have stated strongly before,” he tweeted, “and just to reiterate, if Turkey does anything that I, in my great and unmatched wisdom, consider to be off limits, I will totally destroy and obliterate the Economy of Turkey (I’ve done before!).”

 

Just what, in his unmatched wisdom, Mr. Trump meant by “off limits,” or economic destruction, or the rest of the tweet was not clear. Nor is this the first time the Trump administration has sent conflicting messages about American objectives in Syria.

 

Last December, Mr. Trump overruled his top advisers to order the withdrawal of all 2,000 American ground troops from Syria within 30 days. The decision was ultimately reversed, but it was the final straw for Mr. Mattis.

 

Mr. Erdogan has long threatened to send troops into Syria. Since losing an important election in Istanbul in March, he has been under increasing pressure to find ways to shore up his domestic political support. He’d also like to resettle at least one million Syrian refugees now living in Turkey within the safe zone on the Syrian side of the border. Those refugees have become a political liability for him.

 

But if Kurds in Syria have to defend themselves against the Turks, they are likely to shift their forces from the fight against ISIS, including the guarding of about 10,000 ISIS prisoners now in Kurdish detention centers.

 

Making it possible for refugees to return home is a worthy goal, but forced resettlement is rarely successful. Moreover, many refugees in Turkey do not come from northern Syria and are unlikely to mix easily with local populations.

 

Whether Turkey will go forward with a full invasion is unclear. On Mr. Trump’s orders, a couple hundred American troops have been removed from two military outposts. At the same time, the Kurds have stopped dismantling their fortifications and the joint American-Turkish patrols have been ended, officials say. Congress is threatening sanctions on Turkey.

 

It may seem paradoxical, but in caving in to one of the strongmen he so admires, Mr. Trump may have set the United States on a collision course with Turkey. He’s also put himself into conflict with the Pentagon and his own Republican allies. He may walk his own decision back once again, in part or in whole. But what ally could look at the United States now and see a stalwart partner — and what foe could look at it and fear a determined adversary?

Calling Bruce Wayne.

[Winstonm]

Does Donald Trump Know What His Sysria Policy Is? from the Editorial Board at NYT:

 

 

Calling Bruce Wayne.

Some men just want to watch the world burn.

[y66]

From David Leonhardt at NYT:

 

Gen. James Mattis, the former defense secretary, has so far said nothing about President Trump’s reckless decision to abandon the Kurds, longtime allies of the United States, to a threatened military assault by Turkey.

 

Rex Tillerson, the former secretary of state, has also said nothing.

 

And Lt. Gen. H. R. McMaster, the former national security adviser, has said nothing.

 

They’re all making a mistake. With their silence, they are showing greater loyalty to one man — Trump — than to the national interest.

 

Brett McGurk yesterday showed how to speak up, clearly and courageously. McGurk is no liberal firebrand. He clerked for William Rehnquist, the conservative Supreme Court justice, before joining George W. Bush’s administration as a foreign-policy official, and then serving in Barack Obama’s administration and later Trump’s. In late 2018, McGurk resigned on principle, shortly after Mattis did, in protest of Trump’s decision to withdraw American troops from Syria.

 

Here’s what McGurk wrote yesterday: “Donald Trump is not a Commander-in-Chief. He makes impulsive decisions with no knowledge or deliberation. He sends military personnel into harm’s way with no backing. He blusters and then leaves our allies exposed when adversaries call his bluff or he confronts a hard phone call.”

 

And in response to a tweet from Trump he added: “Mr. President: With all due respect, none of this is true. I’d recommend having meetings with your experts and policy team before making historic life-and-death decisions. Making such decisions after a one-off call from a foreign leader is malpractice.”

 

General Mattis; Mr. Tillerson; General McMaster: It’s past time to say what you think.

 

For more …

 

Republican leaders — including frequent defenders of the president like senators Mitch McConnell, Lindsey Graham and Marco Rubio, as well as Nikki Haley, Trump’s former ambassador to the United Nations — harshly criticized Trump’s decision. So did some of his usual media allies, including Fox News and the editorial board of The Wall Street Journal.

 

“A lot of [Republicans] who held back criticism of the president on Ukraine grift are unleashing at him over Syria,” tweeted Tamara Cofman Wittes of the Brookings Institution. “It is very clear that [Republicans] with aspirations to national leadership now see an imperative to show their independence from Trump. And that’s a big change.”

 

Bloomberg Opinion’s Jonathan Bernstein asks whether the Turkish president, Recep Tayyip Erdogan, may have politically damaging information on Trump — like knowledge of another unseemly phone call — or whether Trump’s business investment in Turkey may be affecting his actions. “In normal cases, I’d caution people against getting carried away with such speculation. With Trump, it’s difficult,” Bernstein writes. “When Trump personally and inexplicably reverses U.S. policy immediately after a conversation with a foreign leader, it’s hard not to wonder exactly what motivations are at work.”

Trump has a strange idea of how loyalty works and what it means to be able to count on an ally.

[kenberg]

Reading the news today regardnig Syria, Turkey and, of course, the USA:

From our president speaking of what Turkey might do:

"If Turkey does anything that I, in my great and unmatched wisdom, consider to be off limits, I will totally destroy and obliterate the Economy of Turkey"

See https://www.washingt...1b63_story.html

 

From Pat Roberson, on the same general subject:

""I believe … the president of the United States is in danger of losing the mandate of heaven if he permits this to happen"

Has someone slipped LSD into my coffee? Have I been transported to some other universe? Forget fake news, just tell me this is a bad dream.

[hrothgar]

What I found really weird was the "Mandate of Heaven" comment.

 

I'm used to seeing this expression used wrt to China, but not US...

[johnu]

Has someone slipped LSD into my coffee? Have I been transported to some other universe? Forget fake news, just tell me this is a bad dream.

Not just a bad dream that has lasted almost 3 years but the worst kind of bad hallucination. A nightmare that you can't believe is real but is actually reality.

[johnu]

Speaking of bizarro world

 

Trump Claims Poll Numbers Have Zoomed 17 Points As He Defends Abandonment Of Kurds

 

In a fractured White House news conference Monday, President Donald Trump claimed poll numbers supporting him have jumped 17 percentage points. That’s despite an impeachment inquiry and the uproar over his decision Sunday night to draw down U.S. troops as Kurdish allies face a Turkish incursion into Syria.

A very modest man. He forgot to mention the recent poll where he got 99% of the vote for best president in the history of the world, and the 75% of the vote for greatest man in history (soundly trouncing wannabes like Jesus, Muhammad, George Washington, Abe Lincoln, etc)

 

He boasted that ISIS was defeated, thanks largely to him, particularly because he supplied the U.S. military with ammunition when it had none.

 

“When I took over our military, we didn’t have ammunition,” he explained. “I was told by a top general, maybe the top of them all: ‘Sir, I’m sorry, sir, we don’t have ammunition.’ I said, ‘I will never let another president have that happen to him or her. We didn’t have ammunition.’”

More modesty by god's messenger. In fact, the US military soldiers didn't even have shoes, or fuel for their planes and tanks. It was very sad to see US soldiers in their bare feet trying to push tanks and trucks that had run out of fuel.

 

As for his controversial decision on Syria, Trump appeared resigned Monday to inevitable fighting between Turkey and the Kurds because they’re “natural enemies.” He seemed surprised to note that a historian said Monday that they’ve been fighting for “hundreds of years.”

Who would have known that Turkey has tremendous animosity towards the Kurds? :rolleyes: You would to be a student of history to know something like that, or maybe listen to your foreign affairs experts who spend their lives studying things like that.

[y66]

Speaking of polling, this just in from the Hartford Courant:

 

For the second straight week a Quinnipiac Poll has found that a majority of voters support the impeachment inquiry now underway in the U.S. House of Representatives.

 

The poll found that by a 53-43 margin, voters approve of the inquiry, about the same breakdown as a week ago.

 

Voters are divided however on whether President Trump should be actually impeached and removed from office. The poll found that 49% oppose impeachment and 45% support ousting the president.

 

Nearly 90% of Republicans say the impeachment inquiry is “a witch hunt.” The poll found that 48 percent of voters think that asking a foreign leaders to investigate a political rival is justification for impeaching the president.

 

Among Democrats running for president, Sen. Elizabeth Warren remains virtually tied with former Vice President Joe Biden. Warren had the support of 29% of voters while Biden had support from 26% of voters.

 

“Warren maintains her strength in the Democratic primary, which has been consistently growing since the start of her campaign. This poll confirms her status as a co-frontrunner with Biden,” Malloy said.

 

The poll of 1,483 voters has a margin of error of plus or minus 3.1 percentage points.

One in ten Republicans aren't bonkers? Ha. Who's coffee is spiked with LSD?

[Winstonm]

The White House has sent a letter to Nancy Pelosi that states the administration will not cooperate with an unconstitutional impeachment inquiry. I guess Cipollone doesn't realize that unconstitutional impeachment inquiry is an oxymoron; but then, so is President Trump.

[Winstonm]

Telling it like it is and was, and no, he doesn't absolve Obama, Biden, or Hillary - but none of that justifies Trump.

 

If Holder had prosecuted the elite banksters, Trump would have been defeated in the election. The refusal to prosecute the banksters who gained immense wealth by leading frauds and predation, along with the massive bank bailout, was a critical contributor to the public rage that gave Trump his Electoral College victory.

 

Hillary Clinton’s gratuitous decision to enrich herself through secret speeches to two of the world’s most fraudulent banks – Goldman Sachs and Deutsche Bank – gifted freebies essential to Trump’s election. Clinton advisers repeatedly warned her that the Republicans would use the secret paid speeches as a mace to attack her. She and Bill Clinton were, through tens of millions of dollars in speech fees, already wealthy. She had no financial need to take money from two of the world’s most destructive criminal enterprises. Her greed trumped her ambition, so she ignored her advisers’ warnings and did the secret speeches. Those freebies gifted the election to Trump.

 

From the NYT article cited in the article:

 

Journalists, perhaps seeking to appear balanced, have sometimes described Trump’s claims about Biden as “unsubstantiated” or “unsupported.” That is misleading, because it suggests more muddiness in the factual record than actually exists. Trump isn’t making unproven charges against Biden. He is blatantly lying about him. He and his defenders are spreading a conspiracy theory that is the precise opposite of the truth.

[cherdano]

I don't fault the trolls who post on this thread. Rick Perry made them do it too.

Actually I am starting to get worried about them - can someone check their pulse? Surely by now the marching orders to keep attacking Adam Schiff should have arrived.

 

On the other hand, I admire the principled stance the White House and DOJ is taking. Even though they know bringing more evidence to light could only be exculpatory, and shine a bright light on the greatest president the US has ever had, they are deeply committed to overturning case law that was wrongly decided in the haste of the Watergate hearings. Where would we end up with if Congress could just decide to investigate alleged criminal wrong-doing by the executive branch?

[y66]

Perhaps the tariffs are affecting the supply of troll food and taking a toll on the health of the trolls. They have not been getting a rise out of their favorite lib lately. That can't be good for troll morale.

[y66]

From Edward Luce at FT:

 

Five years before the financial meltdown of 2008, Robert Lucas famously declared that “the central problem of depression-prevention has been solved . . . and has in fact been solved for many decades”.

 

The University of Chicago economist was not alone. Up to the eve of the worst crash in 80 years, America’s economic luminaries, including Alan Greenspan, former chairman of the Federal Reserve, and his successor Ben Bernanke insisted there was no cause for alarm.

 

Having failed to foresee the crisis, many badly misread its aftermath. As early as December 2008, Mervyn King, governor of the Bank of England, anticipated breakaway wage growth. We are still waiting.

 

Greenspan, meanwhile, predicted double-digit inflation. Eleven years into America’s weakest recovery on record, US inflation remains stubbornly below its two per cent target. As recently as last February, Jay Powell, the current Fed chairman, said it was a “bit of a puzzle” why wage growth had not yet taken off.

 

Why do economists continue to get it so wrong? One answer is that not all of them do. David Blanchflower, who was on the Bank of England’s monetary policy committee during the 2008 crash, insists that evidence of an impending crash was hidden in plain view long before it happened. Blanchflower, whose book Not Working: Where Have all the Good Jobs Gone? is a stinging rebuke to his profession, was consistently outvoted eight to one on the MPC, which sets UK interest rates. Unlike his colleagues, who were using models based on a 1970s-style economy, Blanchflower went out and talked to people. He calls this “the economics of walking about”.

 

His peers, meanwhile, were relying on “largely untested theoretical models that amounted to little more than mathematical mind games”. Paul Romer, the former World Bank chief economist, calls this “mathiness” — playing with regression to give a false sense of precision. Others might call it alchemy. Lucas, whose Chicago School housed the high priesthood of mathiness, won a Nobel Prize for his rational expectations theory. It demonstrated that the market was always right.

 

The rise and fall of the Chicago School is chronicled by Binyamin Appelbaum in his admirable book The Economists’ Hour. As he shows, economists were treated as little more than backroom statisticians until the late 1960s. That was when the Chicago School, led by the Nobel-prize winning Milton Friedman, took over.

 

The economists’ age of glamour had arrived, propelling them into the centre of power and on to our television screens. They drew inspiration from Friedrich Hayek, whose book The Road to Serfdom (1944) argued that almost any government role in the economy created a slippery slope to autocracy.

 

The “economists’ hour” contained many overlapping schools. Some, like Friedman, were monetarists, who believed that inflation was solely a function of money supply — control the latter and you tame the former. Others, like Arthur Laffer, were supply-siders, who argue that tax cuts always pay for themselves through higher corporate revenues. All believed that the markets know best. As Greenspan once quipped: “I have never seen a constructive regulation yet”.

 

Appelbaum argues that their heyday ended on October 13 2008, when the chief executives of America’s largest banks were marched into the US Treasury for a crisis meeting. He is surely correct. The mother of all Wall Street bailouts shattered the reputation economics had gained over the previous 40 years. Yet economists’ hubris lingers. Perhaps it is a lagging indicator. Economists might call it “sticky”.

 

One reason that wages have not picked up in Britain and the US is because many economists are still using the old models. Real-term weekly wages for non-supervisory US production workers are 9 per cent below where they were in 1972. In the UK, the hourly wage is 5.7 per cent lower than it was before the great recession.

 

The traditional models — notably, “Nairu”, the non-accelerating inflation rate of unemployment — tell economists that a jobless rate of 3.5 per cent, which is the current US level, is well below the point at which higher wage demands would start to kick in. Just wait one more quarter, they say. The data will arrive.

 

This overlooks the importance of the low labour force participation rate, which captures those who have given up seeking work altogether and who are excluded from the jobless measure. One in 12 prime age American males are ex-offenders, which pretty much shuts them out of the jobs market. Walking about more might help central bankers grasp that the jobless rate no longer captures reality.

 

“Policymakers at the start of 2019 seem to be just as out of touch with what is going on outside the big cities as they were as the great recession was nearing,” writes Blanchflower.

 

Another ancient model, which was last put into practice by Herbert Hoover after the 1929 Wall Street Crash, holds that an economy should be punished for its excesses. Hoover’s fiscal contraction turned the stock market crash into the Great Depression. George Osborne, the UK chancellor after 2010, and the Tea Party of Republican populists, which took control of Congress the same year, revived that old saw. The dampening effects of Osborne’s policy of “expansionary austerity” helped pave the way for the Leave vote in the 2016 Brexit referendum. Washington’s fiscal gridlock helped tee-up Donald Trump’s victory in the US presidential election later that year.

 

Yet the hubris persists. One of Trump’s advisers is Arthur Laffer, whose wife famously goes on long runs “because it’s the only way I can stay married to a lunatic”. Trump’s $1.6tn tax cut was the wrong medicine for an economy suffering from low investment. The tax cut has neither paid for itself, as Laffer predicted, nor lifted the US growth rate. With interest rates so low, it would be the ideal time to modernise America’s infrastructure. As Blanchflower quips, America’s failure to do so is the equivalent of leaving a trillion dollar note on the sidewalk.

 

So where do we go from here? In his seminal book Global Inequality (2016), Branko Milanovic — a New York-based academic originally from Serbia — showed that we are living in the age of global convergence. As his now famous “elephant chart” showed, the world’s low-income economies are rapidly catching up with the west. The main body of the elephant shows income growth for the bulk of the world’s population. The downwardly curving trunk captures the ill-fated western middle classes. Finally the trunk tips sharply upwards to reflect the outsized gains of the west’s one per cent. Almost everyone, including the world’s poorest, are benefiting from global convergence. That includes the globalised elites in China, the US and elsewhere, who have never had it so good.

 

The big exception are the west’s blue-collar workforces, who are likely to feel the squeeze for decades to come. Support for globalisation tends to be high in the east and low in the west. Ninety one per cent of people in Vietnam say they are fans of globalisation, against just 37 per cent in France.

 

In his latest book Capitalism, Alone, Milanovic explains why capitalism no longer has competitors. China’s economy is now 80 per cent private sector-owned, versus 50 per cent in the late 1990s and zero per cent before it began its reforms in 1978.

 

The new global competition, Milanovic argues, is between different types of capitalism. This he divides into two: the west’s “liberal meritocratic capitalism” versus China’s “political capitalism”.

 

Each is beset with its own problems. China’s model is undemocratic and must generate high growth rates to maintain its legitimacy. Meanwhile, in most of the west, meritocracy is failing. For the first time, the top 0.1 per cent in America now own the same amount of wealth as the bottom 90 per cent (at 22 per cent of national wealth and 22.8 per cent respectively). As recently as the 1980s, the bottom 90 per cent accounted for more than a third of America’s wealth.

 

Part of this can be attributed to the fact that today’s working rich also live off their capital investments, which consistently achieve higher returns than the non-financial economy. Most of the owners of capital also work for a living. They are harder to tax than those living solely off economic rents “since their high incomes are viewed as being more deserved”. As a result, the west — and particularly the US — is becoming steadily more oligarchic. We can thank the Chicago School for that.

 

Inequality in China is even worse than in the US — and continues to grow. One explanation for Hong Kong’s current ferment is that the city-state is essentially ruled by its plutocratic elites who are appointed by China. Yet most people cannot afford basic housing. Corruption is also growing in China and other parts of the developing world. The more closely bound the rest of the world is into the global economy, the more corruption opportunities arise.

 

The International Monetary Fund’s errors and omissions on global trade, which tracks anomalies in the numbers, has doubled since 2008 to around $200bn. One of the easiest ways to hide the proceeds of graft is to under-invoice exports and over-invoice imports. By deflating your export earnings and inflating your import bill, you can make your ill-gotten gains disappear. The west’s battery of lawyers and real estate firms, especially in London and New York, handle the rest. They also provide what Milanovic calls “moral laundering” by facilitating generous kleptocratic donations to Ivy League universities and art galleries.

 

The closer one looks, the more it appears that Milanovic’s two types of capitalism are merging. The west’s claims to meritocracy look increasingly hollow, while China’s promise of eternal growth must surely be coming to an end. What we do know is that there is growing equality between nations and growing inequality within them. No system, whether liberal or illiberal, can tolerate plutocracy indefinitely.

 

“As long as capitalists used most of their surplus income to invest rather than to consume, the social contract held,” writes Milanovic. His book leaves little doubt that the social contract no longer holds. Whether you live in Beijing or New York, the time for renegotiation is approaching.

[kenberg]

From Edward Luce at FT:

 

 

 

It's an interesting article. I had not heard of the elephant graph but I have now looked it up.

 

It seems that the history of economic thought goes something like this: Every decade or so a revision occurs, the new guys explain that the old guys were really stupid but fortunately they, the new guys, have now seen the light. We can always hope. History suggests caution.

[Winstonm]

 

It's an interesting article. I had not heard of the elephant graph but I have now looked it up.

 

It seems that the history of economic thought goes something like this: Every decade or so a revision occurs, the new guys explain that the old guys were really stupid but fortunately they, the new guys, have now seen the light. We can always hope. History suggests caution.

 

“We learn from history that we do not learn from history.” - Friedrich Hegel

[kenberg]

 

"We learn from history that we do not learn from history." - Friedrich Hegel

 

 

I like that!

[Zelandakh]

economists were treated as little more than backroom statisticians until the late 1960s

LOL. Can anyone take this sort of rubbish throwaway article seriously?

[johnu]

Trump On Abandoning Kurdish Forces: The Kurds Didn’t Help Us In WWII

 

President Donald Trump defended his controversial decision to yank support for U.S.-allied Kurdish fighters by noting that the Kurds didn’t help the U.S. during World War II and the invasion of Normandy, known as D-day.

 

“Now the Kurds are fighting for their land,” Trump told reporters at the White House on Wednesday.“As somebody wrote in a very powerful article today, they didn’t help us in the Second World War, they didn’t help us with Normandy, as an example,” the president added. “They’re there to help us with their land, and that’s a different thing.”

The Stable History Genius strikes again. It is true that there is no mention of Kurdland taking sides during WWII. :rolleyes: It's almost like they had a Fake country. I hope nobody at the White House jeopardizes their job by point out that the USA is a fake Christian country because it never sent troops to fight in the Crusades. You would think that god's favorite country, the US of A could spare a few tanks, fighter jets, and heavy bombers to help win back the Holy Land.

[Zelandakh]

The Stable History Genius strikes again. It is true that there is no mention of Kurdland taking sides during WWII. :rolleyes: It's almost like they had a Fake country. I hope nobody at the White House jeopardizes their job by point out that the USA is a fake Christian country because it never sent troops to fight in the Crusades. You would think that god's favorite country, the US of A could spare a few tanks, fighter jets, and heavy bombers to help win back the Holy Land.

 

The Kurds did have a state in the 1920s. Given that it was conquered by the British and returned to Iraqi control by the (American dominated) League of Nations, one could understand if they were somewhat distrustful of the Allied side during WWII. To some extent it is therefore perhaps surprising that they were not fighting on the side of the Axis powers.

 

But your scepticism is misplaced here. As your President is the second coming of God with a mandate from Heaven, his unmatched wisdom can surely never be questioned.