Saturday, January 20, 2018

If the Sky Is Not Falling...

If you have entered the Chicken Little stage of human development and spend your time running around warning people that the sky is falling… you have a vested interest in calamity. If you predict that the sky will fall and the sky doesn’t fall, you look like a fool or a liar or a fraud. If you, a seasoned and somewhat dotty politician, announce that a specific tax reform bill will bring about Armageddon… you have an interest in precipitating the arrival of Armageddon.

At a time when the news on the economy seems very good indeed, and where the worst predictions about the Trump presidency have not come to pass, you can understand why Senate Democrats are trying to change the narrative… by shutting down the government. If their action can help bring about an economic collapse, they will happily rush out to the microphones and blame Trump. They will happily announce that they were right all along.

This morning Bret Stephens, having found sobriety, points out that the Democratic Party strategy of indulging in rhetorical hyperbole while predicting the imminent end of the world is a gamble on catstrophe.

In December this column warned that hysterical opposition to the Republican tax bill was a fool’s game for Democrats that could only help Donald Trump. Yes, there were things to dislike in the legislation, from both a liberal and a conservative perspective.

But it was not the moral and fiscal apocalypse its critics claimed. And its central achievement — a dramatic cut in corporate rates to 21 percent from 35 percent — was an economic no-brainer that many Democrats, including President Obama, had supported (albeit less steeply) just a few years ago.

Apple will not be the only multinational that will soon bring back gigantic profits to take advantage of new low repatriation rates. Microsoft holds $146 billion in overseas earnings, Pfizer $178 billion, General Electric $82 billion, Alphabet $78 billion, and Cisco $71 billion, according to estimates from the Zion Research Group. The total stash is about $3 trillion — by one measure nearly three times what it was just a decade ago.

Assume that just half of that money comes home to the United States. It’s still the equivalent of Canada’s entire gross domestic product. Not too shabby, especially considering all the hyperbolic predictions of economic doom that went with Trump’s election.

Democrats, Stephens continues, did not realize that the Obama economic recovery was anemic. They tried to run on prosperity at a time when the nation was not enjoying prosperity. Normally, they would have assumed that they could manipulate American minds to make them think that the economy was better than it was. Somehow or other, the propaganda machine failed. They seem to believe that they were outwitted by Donald Trump and Vladimir Putin. A strange idea, indeed.

Democrats entered the 2016 election cycle on what they thought was the back of a strong economy. It wasn’t. Barack Obama presided over the weakest expansion in postwar history. The economy grew by 15.5 percent from the second quarter of 2009 to the second quarter of 2016. During the (slightly longer) Reagan boom of 1982-90, it grew by more than 38 percent. The failure to understand this meant a failure to appreciate the depth of American discontent. It helps explain how Hillary Clinton lost her unlosable election to a man whose central claim to office was that he understood business.

If the economy has improved under Trump, the Democrats have been running around saying that it’s all because of Obama. Considering that one major impetus of economic growth has been Trump’s dismantling of the regulatory state that Obama empowered, it’s a difficult case to make:

More recently, Democrats have convinced themselves that Trump is merely the beneficiary of Obama’s economic legacy. But how can the critics who previously assured us that Trump’s election would cause certain calamity now explain that he’s nothing but a lucky bystander to forces beyond his control? Had the economy tumbled over the past year his critics would surely have blamed him. It’s ill grace to deny him all credit when it’s doing so well.

“ill grace”… whatever would have made anyone imagine that the Democratic Party lacks grace or graciousness.

Apparently, Democrats are hoping that they can derail the economy and the stock market by shutting down the government. And yet, they have dug in their heels and hope to damange the economy in order to protect illegal aliens. It seems like a bad wager, especially since illegal immigrants themselves do significant damage to the economy:

Yet one gets a distinct sense that Trump’s relentless critics would rather bury the Apple news or look for the cloud within the silver lining. This is not a good look. If making confident but lousy predictions is one form of political malpractice, wanting things to fail is another.

The same goes for the looming government shutdown, which may have begun by the time you read this column. Democrats are placing a large bet that it’s a political showdown they can win. But what they are mainly doing is wrecking their chances of retaking the House or Senate by appearing to put the interests of DACA’s immigrant “Dreamers” ahead of the rest of America.

And, of course, rooting for the president to fail is also rooting for America to fail. Most Americans still have enough patriotism to revile anyone who seems to be trying to make America fail again:

… normal Americans — that is, those who hold the outcome of the next election in their hands — do not want him to fail. They want statesmanship, not schadenfreude.

Wouldn’t it be smart of all of Trump’s opponents to show they are superior to him in the former? And wouldn’t a good way of doing that be to abjure the latter, even if it sometimes means giving him some credit?

To be fair and balanced, Democrats and progressives do not really care about how the economy fares, this quarter or next quarter. They are playing a longer game. Their arena is not the marketplace of goods and services but the marketplace of ideas. They are fighting to control the American mind and to undermine traditional American culture. They are fighting for diversity. They worship the gods of multiculturalism. 

To their minds, victory consists in the election of a transgender state legislator in Virginia. They have declared war on merit and want people to be judged, not on the content of their character, but on their race, gender, ethnicity and sexual preferences. Then they go to war against any American who uses derogatory language. They will give you the economy if you let them control your mind and your speech.

Think about it. The economy is moving ahead. The stock market is moving ahead smartly. The Democratic Party thinks that the world is about to come to an end because Trump called a few nations shitholes.


trigger warning said...

To: B. Stephens
Subject: Editorial note

re: "appearing to put the interests of DACA’s immigrant “Dreamers” ahead of the rest of America."

Delete "appearing"

Middle America

More to the point, the Left hopes the ship capsizes because they don't like the captain.

Ares Olympus said...
This comment has been removed by the author.
Ares Olympus said...

Stuart: Think about it. The economy is moving ahead. The stock market is moving ahead smartly.

Count me in the "sky is falling" crowd, although it seems clear to me it will fall whomever is president. The only question is how far we'll fall, and how orderly we can make it.

I had a smart friend dismiss economic concerns in summer 2007 saying "all the economic indicators are good", I have some credible doubts that we can borrow our way to prosperity, even if it can look good for few more years, especially if we turn a blind eye to what the financial world is doing to keep their magic alive, and that seems to be what the GOP is most effective at.

The only good I can see in the future is that those with the most to lose, will likely lose the most. However the top 10%, top 1%, and top 0.1% have so much wealth that they can lose quite a lot without feeling much pain. And even if they sell their 5 and 6th houses for a 90% loss, they could afford a 100% loss and are only selling because they're bored with a given city, so perhaps there'll soon be lots of bargain mansions for people who aspire to such things.

Somewhere there is a "real economy", and when this fake "Credit economy" falls apart. Apparently Trump and the Republicans will be the ones to send us over the cliff.

So yes, as long as Bill Clintons' "It's the economy stupid" reigns, perhaps a contemptible bully president and GOP can yet be less hated than their hand-wringing opposition on election day 2018? People love a winner, even if they'll turn on a dime when things change.

Sam L. said...

Ares has imbibed the Democrat Elixer, guaranteed to fix what ails you or none of your money back.

Sam L. said...

How soon will Bret be fired for failing to toe the NYT Party Line? Not only not toeing, but calling in artillery strikes.

trigger warning said...

Sam, be gentle. Ares probably has many frightening childhood memories involving bullies.

Jack Fisher said...

AO, that is incoherent.

Ares Olympus said...

trigger warning said... Ares probably has many frightening childhood memories involving bullies.

I don't remember being afraid of any bullies or never met any really sadistic ones. The individual male ego seems relatively predictable, and herds of them might be even easier. Maybe having a bigger older brother helped me learn defensive skills? Like I discovered after I hit him in the jaw with a lucky swing that intended to miss, I could put myself into a ball a corner with my hands over my head and get hit until he was bored, and I didn't get hurt. I suppose kids can't learn such important lessons in conflict management any more - they have to tattle to parents or call 911.

But I am afraid of bubble economies that can only be repaired by blowing larger bubble economies, based on one-time energy resources and debt promises in the future that can never be kept. It can't end well. I'm sure I would have chosen Jimmy Carter's stagflation economy if I had been old enough, and probably the internet would have been judged too energy intensive and never existed. So I guess I'm grateful to see what other wonders will be invented before it all falls down. It's been a good ride, and I have less far to fall than most.

James said...

It's the old "I'd rather rule in Hell than serve in Heaven".

trigger warning said...

Olympus, only you could credibly valorize pillbugs. Call Marvel. They're fully SJW-converged, and I'm sure Pillbug would make a great character for SafeSpace Comix.

Unknown said...
This comment has been removed by a blog administrator.
Ares Olympus said...

TW, I prefer Tortoise to Pillbug, and the comics did have TMNTs, although I don't recall how often they retreated into their shells for a final defense, or how often their enemies would flip them upside down and spin them around for fun. I guess you're right, not great for heroic stances.

trigger warning said...

Ares, I doubt anyone would ever confuse you with a ninja, no matter the species.

But you should consider the downstream marketing reveniue for, say, Official Pillbug Soccer Balls.