The brand of all cultural revolutions is untruth about the past and present in order to control the future. Why we have this happening to our country is the only mystery left.
The current revolution is based on a series of lies, misrepresentations, and distortions, whose weight will soon sink it.
Unfortunately few in authority have been more wrong, and yet more self-righteously wrong, than the esteemed Dr. Anthony Fauci. Given his long service as the director of the National Institute of Allergy and Infectious Diseases and his stature during the AIDS crisis, he has rightly been held up by the media as the gold standard of coronavirus information. The media has constructed Fauci as a constant corrective of Trump’s supposed “lies” about the utility of travel bans, analogies with a bad flu year, and logical endorsement of hydroxychloroquine as a “what do you have to lose” possible therapy.
But the omnipresent Fauci himself unfortunately has now lost credibility. The reason is that he has offered authoritative advice about facts, which either were not known or could not have been known at the time of his declarations.
Since January, Fauci has variously advised the nation both that the coronavirus probably was unlikely to cause a major health crisis in the United States and later that it might yet kill 240,000 Americans. In January, he praised China for its transparent handling of the coronavirus epidemic, not much later he conceded that perhaps they’d done a poor job of that. He has cautioned that the virus both poses low risks and, later, high risks, for Americans. Wearing masks, Fauci warned, was both of little utility and yet, later, essential. Hydroxychloroquine, he huffed, had little utility; when studies showed that it did, he still has kept mostly silent.
At various times, he emphasized that social distancing and avoiding optional activities were mandatory, but earlier that blind dating and going on cruise ships were permissible. Fauci weighed in on the inadvisability of restarting businesses prematurely, but he has displayed less certainty about the millions of demonstrators and rioters in the streets for a month violating quarantines. The point is not that he is human like all of us, but that in each of these cases he asserted such contradictions with near-divine certainty—and further confused the public in extremis.
In terms of how the United States “fared,” it is simply untrue that Europe embraced superior social policies in containing the virus. The only somewhat reliable assessments of viral lethality are population numbers and deaths by COVID-19, although the latter is often in dispute.
By such rubrics, the United States, so far, has fared better than most of the major European countries—France, Italy, the United Kingdom, Spain, Sweden, and Belgium—in terms of deaths per million. Germany is the one major exception. But if blame is to be allotted to public officials for the United States having a higher fatality rate than Germany, then the cause is most likely governors of high-death, Eastern Seaboard states—New York, New Jersey, Massachusetts, and Connecticut in particular. They either sent the infected into rest homes, or did not early on ensure that their mass transit systems were sanitized daily as well as practicing social distancing.
New York Governor Andrew Cuomo, more than any other regional or national leader, is culpable for decisions that doomed thousands of elderly patients. He did not just suggest long-term-care facilities receive active COVID-19 patients, but ordered them to take them—knowing at the time that the disease in its lethal manifestations targeted the elderly, infirm, and bedridden.
Then in shameful fashion, after thousands died, Cuomo claimed that either the facilities themselves or Donald Trump were responsible for the deaths. In truth, in the United States, the coronavirus is largely a fatal disease in two senses: the vulnerable in just four states on the Eastern Seaboard that account for about 12 percent of the nation’s population but close to half of its total COVID-19 fatalities, and/or patients in rest homes or those over 65 years old with comorbidities.
Why are there currently spikes in cases among young people in warmer states and those of less population density in late June? No one is certain. But one likely reason is that millions of protestors for nearly a month crammed the nation’s cities, suburbs, and towns, shouting and screaming without masks, violating social distancing, and often without observant hand washing and sanitizing—most often with official exemption or media and political approval.
The period of exposure and incubation is over, and the resulting new cases—for the most part asymptomatic and clustered among the young—are thus no surprise. Still, what is inconvenient is the rise in these cases—given that the Left either had claimed its mass demonstrations would not spread the disease, or, if they would, the resulting contagion was an affordable price to pay for the cry of the heart protests.
Perhaps, but the real cost of four weeks of protesting, rioting, and looting was to undermine the authority of state officials to enforce blatant violations of the quarantine. Obviously, if some can march with impunity in phalanxes of screaming, shoulder-to-shoulder protestors, while others are jailed as individuals trying to restart a business, then the state has lost its credibility with people and they will simply ignore further edicts as they see fit. Now what adjudicates quarantines are the people’s own calibrations of their own safety.
Mismanagement of the virus? There have been four disastrous official policy decisions: sending patients into rest homes; allowing millions en masse for political reasons to violate state mandates on masks and social distancing; retroactively attempting to reissue quarantine standards that their advocates and authors had themselves earlier de facto destroyed; and consistently issuing pandemic alerts solely on the flawed basis of new positive cases, without distinguishing those who were asymptomatic, or who were infected and recovered without ever being tested, or who were asymptomatic and tested positive for antibodies, or who were only briefly ill, recovered, and by no means still a case-patient.
Black Lives Matter, Antifa, and other revolutionary groups hijacked the tragic death of George Floyd. Within hours they created a mythology of rampant white police lethal attacks on innocent black victims. But that trope, too, was without a factual basis.
The wrongful deaths of unarmed African-Americans in custody have been on the decline, is far less than the number of police murdered per year, less than the number of white suspects killed, and proportionally fewer, in terms of percentages of those arrested by police, than other racial groups.
In rare interracial violence, blacks are five times more likely to attack whites than vice versa. There is a tragic war against young, black males—over 7,000 murdered per year—but it is an urban genocide of sort perpetrated in liberal cities, governed by liberal mayors and governors, and overseen by liberal police chiefs. The shooters are overwhelmingly other black males.
Somehow those facts were distorted by the Left into a trope that George Floyd was typical of an epidemic of white-generated lethal racial hatred. One can certainly argue about systematic racism as being a factor in all these asymmetries, but that is not what the rioting and their apologists have done in trafficking in accusations that have no data to support them.
There is no logic to statue toppling, name changing, or culture canceling other than the quest to assert power, humiliate authorities, and create crises where they do not exist in order to manufacture a faux state of emergency—in service of a political agenda. In some sense, whether any statues fall is contingent entirely on the lack of resistance.
We know this because the ignorant rioters and protestors cannot explain why monuments to Ulysses S. Grant, Cervantes, black Civil War veterans, or Abraham Lincoln need to be toppled and destroyed as much as a statue of Robert E. Lee. We are not told why the Woodrow Wilson School at Princeton is canceled out, but not the Wilson Center in Washington, or why a memorial to President Washington is targeted for defacement but not the hit play, “Hamilton,” another founder who at one time owned slaves. And what or who, if any, exactly is to replace our fallen luminaries? Name the most iconic—Martin Luther King Jr., Malcolm X, or Che Guevarra and the current rules of perfection would disqualify them all.
The abettors of the madness—corporations, the Democratic National Committee, universities, and the media—are not so mad. Yale, named for a slave owner, is now mostly a brand name, not a certification of a first-class, disinterested, and classically liberal education.
Take the elite stamp away, and what replaces it might as well be an online degree mill—given that it is no longer so demonstrable that a Yale graduate learned more than in his four years than did a graduate of Cal State Stanislaus.
So university presidents at Princeton, Yale, Stanford, and Columbia, know that by the standards of BLM their brand names must be changed. But to do so is synonymous with multi-billion-dollar losses and the destruction of centuries-old brands. Perhaps that is why they pander to the mob the way a Roman would-be emperor outbid rivals seeking to win over the Praetorian Guard.
The truth is that the COVID-19 epidemic, the lockdown, and the rioting were seen by the Left, the media, and now the Democratic Party as a renewed effort in this election year to do what Robert Mueller, Ukraine, and impeachment had not—abort the presidency of Donald Trump, or make it impossible for him to be reelected.
So Trump was to be reconfigured as a racist responsible for the death of George Floyd. Then he was smeared as a Herbert Hoover who supposedly crashed the economy all on his own. And then he became a Typhoid Mary purveyor of death who sickened and killed tens of thousands of Americans at his rallies in a way millions at left-wing protests did not.
To that end, almost daily, entire fantasies were birthed, floated, crashed, and then were replaced by new hoaxes. The strategy was that while one lie might be refuted, the bigger and more numerous the lies, the more a continuous narrative could be fabricated.
Consequently, the last two weeks, in succession we were told by the media that a noose was left in a NASCAR garage as a racist threat to NASCAR’s only major African-American driver, typical of Trump’s racist America; that Donald Trump, in dejection and self-incrimination, was soon to quit rather than face the humiliation of a landslide defeat in November; that the president knowingly rejected intelligence that the Russians were paying bounties on American soldiers in Afghanistan, as part of his obeisance to Vladimir Putin; and that Trump went to Mount Rushmore to honor racist presidents and dishonor sacred Native American land.
All were not just lies, but respectively unimaginative and banal successors to similarly long ago discredited lies—the Jussie Smollett hoax, the “Trump never wished to be president in the first place” hoax, the Russian “collusion” hoax, and the hoax that Trump’s presence turns once esteemed monuments that prior presidents, most recently Barack Obama, visited into racist dog whistles.
Then there was the monstrous lie that Joe Biden has no cognitive disabilities. That he does was the consensus of one in five polled Democratic voters, of many of his own primary rivals in numerous Democratic debates, of handlers who bragged that his basement quarantine need not end because it resulted in him outpolling Trump, of a scramble to turn the vice-presidential nomination into a veritable presidential bid, and in a litany of gaffes, blank outs, and tragic memory lapses of familiar names, places, and common referents.
Biden finally came out of his bunker to do some tele-fundraising and talk to a few preselected reporters. He almost immediately blasted a reporter as a “lying dog face.” In one of his next appearances, his opening statement started with “I am Joe Biden’s husband, even as the liberal media insisted “Joe” was “Jill.” There is now a Biden-inspired cottage industry of arguing that what Biden is recorded as saying is not what he was saying—on the theory that he so poorly pronounces words that they can become almost anything you wish.
What is cruel is cynically using a cognitively challenged candidate for the purpose of winning an election and then replacing him with a far-left vice president who otherwise likely would never have been elected.
FDR and the Democratic Party did something similar in his successful fourth-term bid in 1944 because of FDR’s anticipated early death in office—but in matters of hiding physical rather than cognitive impairment. Moreover, at least that dishonest gambit was undertaken in order to prevent a socialist takeover of the United States by jettisoning the hard leftist, Vice President Henry Wallace.
In 2020, the effort is not to ensure that a socialist not be appointed president who otherwise would not have been elected, but rather to ensure that she will be.
The brand of all cultural revolutions is untruth about the past and present in order to control the future. Why we have let this happen to our country is the only mystery left.
To know what the Chinese are really up to, read the futuristic novels of Liu Cixin.
“We are in the foothills of a Cold War.” Those were the words of Henry Kissinger when I interviewed him at the Bloomberg New Economy Forum in Beijing last November.
The observation in itself was not wholly startling. It had seemed obvious to me since early last year that a new Cold War — between the U.S. and China — had begun. This insight wasn’t just based on interviews with elder statesmen. Counterintuitive as it may seem, I had picked up the idea from binge-reading Chinese science fiction.
First, the history. What had started out in early 2018 as a trade war over tariffs and intellectual property theft had by the end of the year metamorphosed into a technology war over the global dominance of the Chinese company Huawei Technologies Co. in 5G network telecommunications; an ideological confrontation in response to Beijing’s treatment of the Uighur minority in China’s Xinjiang region and the pro-democracy protesters in Hong Kong; and an escalation of old frictions over Taiwan and the South China Sea.
Nevertheless, for Kissinger, of all people, to acknowledge that we were in the opening phase of Cold War II was remarkable.
Since his first secret visit to Beijing in 1971, Kissinger has been the master-builder of that policy of U.S.-Chinese engagement which, for 45 years, was a leitmotif of U.S. foreign policy. It fundamentally altered the balance of power at the mid-point of the Cold War, to the disadvantage of the Soviet Union. It created the geopolitical conditions for China’s industrial revolution, the biggest and fastest in history. And it led, after China’s accession to the World Trade Organization, to that extraordinary financial symbiosis which Moritz Schularick and I christened “Chimerica” in 2007.
How did relations between Beijing and Washington sour so quickly that even Kissinger now speaks of Cold War?
The conventional answer to that question is that President Donald Trump has swung like a wrecking ball into the “liberal international order” and that Cold War II is only one of the adverse consequences of his “America First” strategy.
Yet that view attaches too much importance to the change in U.S. foreign policy since 2016, and not enough to the change in Chinese foreign policy that came four years earlier, when Xi Jinping became general secretary of the Chinese Communist Party. Future historians will discern that the decline and fall of Chimerica began in the wake of the global financial crisis, as a new Chinese leader drew the conclusion that there was no longer any need to hide the light of China’s ambition under the bushel that Deng Xiaoping had famously recommended.
When Middle America voted for Trump four years ago, it was partly a backlash against the asymmetric payoffs of engagement and its economic corollary, globalization. Not only had the economic benefits of Chimerica gone disproportionately to China, not only had its costs been borne disproportionately by working-class Americans, but now those same Americans saw that their elected leaders in Washington had acted as midwives at the birth of a new strategic superpower — a challenger for global predominance even more formidable, because economically stronger, than the Soviet Union.
It is not only Kissinger who recognizes that the relationship with Beijing has soured. Orville Schell, another long-time believer in engagement, recently conceded that the approach had foundered “because of the CCP’s deep ambivalence about the way engaging in a truly meaningful way might lead to demands for more reform and change and its ultimate demise.”
Conservative critics of engagement, meanwhile, are eager to dance on its grave, urging that the People’s Republic be economically “quarantined,” its role in global supply chains drastically reduced. There is a spring in the step of the more Sinophobic members of the Trump administration, notably Secretary of State Mike Pompeo, deputy National Security Adviser Matt Pottinger and trade adviser Peter Navarro. For the past three and a half years they have been arguing that the single most important thing about Trump’s presidency was that he had changed the course of U.S. policy towards China, a shift from engagement to competition spelled out in the 2017 National Security Strategy. The events of 2020 would seem to have vindicated them.
The Covid-19 pandemic has done more than intensify Cold War II. It has revealed its existence to those who last year doubted it. The Chinese Communist Party caused this disaster — first by covering up how dangerous the new virus SARS-CoV-2 was, then by delaying the measures that might have prevented its worldwide spread.
Yet now China wants to claim the credit for saving the world from the crisis it caused. Liberally exporting cheap and not wholly reliable ventilators, testing kits and face masks, the Chinese government has sought to snatch victory from the jaws of a defeat it inflicted. The deputy director of the Chinese Foreign Ministry’s information department has gone so far as to endorse a conspiracy theory that the coronavirus originated in the U.S. and retweet an article claiming that an American team had brought the virus with them when they participated in the World Military Games in Wuhan last October.
Just as implausible are Chinese claims that the U.S. is somehow behind the recurrent waves of pro-democracy protest in Hong Kong. The current confrontation over the former British colony’s status is unambiguously Made in China. As Pompeo has said, the new National Security LawBeijing imposed on Hong Kong last Tuesday effectively “destroys” the territory’s semi-autonomy and tears up the 1984 Sino-British joint declaration, which guaranteed that Hong Kong would retain its own legal system for 50 years after its handover to People’s Republic in 1997.
In this context, it is not really surprising that American public sentiment towards China has become markedly more hawkish since 2017, especially among older voters. China is one of few subjects these days about which there is a genuine bipartisan consensus. It is a sign of the times that Democratic presidential candidate Joe Biden’s campaign clearly intends to portray their man as more hawkish on China than Trump. (Former National Security Adviser John Bolton’s new memoir is grist to their mill.) On Hong Kong, Nancy Pelosi, the Democratic speaker of the House, is every bit as indignant as Pompeo.
I have argued that this new Cold War is both inevitable and desirable, not least because it has jolted the U.S. out of complacency and into an earnest effort not to be surpassed by China in artificial intelligence, quantum computing and other strategically crucial technologies. Yet there remains, in academia especially, significant resistance to my viewthat we should stop worrying and learn to love Cold War II.
At a forum last week on World Order after Covid-19, organized by the Kissinger Center for Global Affairs at Johns Hopkins University, a clear majority of speakers warned of the perils of a new Cold War.
Eric Schmidt, the former chairman of Google, argued instead for a “rivalry-partnership” model of “coop-etition,” in which the two nations would at once compete and cooperate in the way that Samsung and Apple have done for years.
Harvard’s Graham Allison, the author of the bestselling “Destined for War: Can America and China Escape Thucydides’s Trap?”, agreed, giving as another example the 11th-century “frenmity” between the Song Emperor of China and the Liao kingdom on China’s northern border. The pandemic, Allison argued, has made “incandescent the impossibility of identifying China clearly as either foe or friend. Rivalry-partnership may sound complicated, but life is complicated.”
“The establishment of a productive and predictable US/China relationship,” wrote John Lipsky, formerly of the International Monetary Fund, “is a sine qua non for strengthening the institutions of global governance.” The last Cold War had cast a “shadow of a global holocaust for decades,” observed James Steinberg, a former deputy secretary of state. “What can be done to create a context to limit the rivalry and create space for cooperation?”
Elizabeth Economy, my colleague at the Hoover Institution, had an answer: “The United States and China could … partner to address a global challenge,” namely climate change. Tom Wright of the Brookings Institution took a similar line: “Focusing only on great power competition while ignoring the need for cooperation will not actually give the United States an enduring strategic advantage over China.”
All this sounds eminently reasonable, apart from one thing. The Chinese Communist Party isn’t Samsung, much less the Liao kingdom. Rather — as was true in Cold War I, when (especially after 1968) academics tended to be doves rather than hawks — today’s proponents of “rivalry-partnership” are overlooking the possibility that the Chinese aren’t interested in being frenemies. They know full well this is a Cold War, because they started it.
To be sure, there are also Chinese scholars who lament the passing of engagement. The economist Yu Yongding recently joined Kevin Gallagher of Boston University to argue for reconciliation between Washington and Beijing. Yet that is no longer the official view in Beijing. When I first began talking publicly about Cold War II at conferences last year, I was surprised that no Chinese delegates contradicted me. In September, I asked one of them — the Chinese head of a major international institution — why that was. “Because I agree with you!” he replied with a smile.
As a visiting professor at Tsinghua University in Beijing, I have seen for myself the ideological turning of the tide under Xi. Academics who study taboo subjects such as the Cultural Revolution find themselves subject to investigations or worse. Those who take a more combative stance toward the West get promoted.
Yan Xuetong, dean of the Institute of International Relations at Tsinghua, recently argued that Cold War II, unlike Cold War I, will be a purely technological competition, without proxy wars and nuclear brinkmanship. Yao Yang, dean of the National School of Development at Peking University, was equally candid in an interview with the Beijing Cultural Review, published on April 28.
“To a certain degree we already find ourselves in the situation of a New Cold War,” he said. “There are two basic reasons for this. The first is the need for Western politicians to play the blame game” about the origins of the pandemic. “The next thing,” he added, “is that now Westerners want to make this into a ‘systems’ question, saying that the reason that China could carry out such drastic control measures [in Hubei province] is because China is not a democratic society, and this is where the power and capacity to do this came from.”
This, however, is weak beer compared with the hard stuff regularly served up on Twitter by the pack leader of the “wolf warrior” diplomats, Zhao Lijian. “The Hong Kong Autonomy Act passed by the US Senate is nothing but a piece of scrap paper,” he tweeted on Monday, in response to the congressional retaliation against China’s new Hong Kong security law. By his standards, this was understatement.
The tone of the official Chinese communiqué released after Pompeo’s June 17 meeting in Hawaii with Yang Jiechi, the director of the Communist Party’s Office of Foreign Affairs, was vintage Cold War. On the persecution of the Uighurs, for example, it called on “the US side to respect China’s counter-terrorism and de-radicalization efforts, stop applying double standards on counter-terrorism issues, and stop using Xinjiang-related issues as a pretext to interfere in China’s internal affairs.”
And this old shrillness, so reminiscent of the Mao Zedong era, is not reserved for the U.S. alone. The Chinese government lashes out at any country that has the temerity to criticize it, from Australia — “gum stuck to the bottom of China’s shoe” according to the editor of the Party-controlled Global Times — to India to the U.K.
Those who hope to revive engagement, or at least establish frenmity with Beijing, underestimate the influence of Wang Huning, a member since 2017 of the Standing Committee of the Politburo, the most powerful body in China, and Xi’s most influential adviser. Back in August 1988, Wang spent six months in the U.S. as a visiting scholar, traveling to more than 30 cities and nearly 20 universities. His account of that trip, “America against America,” (published in 1991) is a critique — in places scathing — of American democracy, capitalism and culture (racial division features prominently in the third chapter).
Yet the book that has done the most to educate me about how China views America and the world today is, as I said, not a political text, but a work of science fiction. “The Dark Forest” was Liu Cixin’s 2008 sequel to the hugely successful “Three-Body Problem.” It would be hard to overstate Liu’s influence in contemporary China: He is revered by the Shenzhen and Hangzhou tech companies, and was officially endorsed as one of the faces of 21st-century Chinese creativity by none other than … Wang Huning.
“The Dark Forest,” which continues the story of the invasion of Earth by the ruthless and technologically superior Trisolarans, introduces Liu’s three axioms of “cosmic sociology.”
First, “Survival is the primary need of civilization.” Second, “Civilization continuously grows and expands, but the total matter in the universe remains constant.” Third, “chains of suspicion” and the risk of a “technological explosion” in another civilization mean that in space there can only be the law of the jungle. In the words of the book’s hero, Luo Ji:
The universe is a dark forest. Every civilization is an armed hunter stalking through the trees like a ghost … trying to tread without sound … The hunter has to be careful, because everywhere in the forest are stealthy hunters like him. If he finds other life — another hunter, an angel or a demon, a delicate infant or a tottering old man, a fairy or a demigod — there’s only one thing he can do: open fire and eliminate them. In this forest, hell is other people … any life that exposes its own existence will be swiftly wiped out.
Kissinger is often thought of (in my view, wrongly) as the supreme American exponent of Realpolitik. But this is something much harsher than realism. This is intergalactic Darwinism.
Of course, you may say, it’s just sci-fi. Yes, but “The Dark Forest” gives us an insight into something we think too little about: how Xi’s China thinks. It’s not up to us whether or not we have a Cold War with China, if China has already declared Cold War on us.
Not only are we already in the foothills of that new Cold War; those foothills are also impenetrably covered in a dark forest of China’s devising.
Predicting the speed and strength of the United States' recovery from the current recession is extremely difficult. But what is clear is that policymakers must boost incentives to work in normal times when jobs are plentiful, while strengthening the safety net for when they are not and for those who are unable to work.
STANFORD – Like most of the world, the United States is attempting to overcome both the COVID-19 pandemic and a deep recession caused by the resulting government-ordered shutdown. At annual rates, the US economy shrank by 5% in the first quarter of 2020, and in the second quarter just ending, it could contract by 40% – the steepest decline since the Great Depression.
Moreover, tens of millions of workers have lost their jobs, causing the unemployment rate to soar to a post-Great Depression high of 14.7% in April. And although 70% of those laid off say they expect to be recalled to their jobs, not all will be, because many firms will fold, relocate, or reorganize.
True, the initial reopening of the economy has led to a sharp rebound that is projected to continue in the third quarter. Employment rose by 2.5 million in May, while high-frequency data from credit cards and mobility tracking for May and June show sizable bounce backs from April lows, with activity in a few sectors approaching or even exceeding year-earlier levels.
But the rebound varies by sector and region. Although Big Tech, home-improvement suppliers, and retail sales of alcoholic beverages have flourished, travel and leisure have collapsed and will take much longer to recover. And restaurants with drive-through service have fared much better than those able to serve only indoors.
Most forecasters therefore predict that the early “V-shaped” recovery will slow over the next few quarters, and instead come to resemble the Nike swoosh. But this plausible baseline forecast is subject to greater than normal uncertainty.
For starters, the shutdown of non-essential businesses in response to the pandemic led to a demand-side shock as well. So far, trillions of dollars in business grants and loans, cash payments to households, and unemployment insurance with federal bonus payments (enabling two-thirds of eligible workers to receive benefits that exceed their lost earnings) have provided a cushion to help the economy recover. The US Federal Reserve has pledged to keep its target interest rate until the economy returns to full employment, and it continues to expand the scope of its asset purchases. And a fourth fiscal package expected next month should focus on reopening the economy, including by limiting firms’ legal liability and redirecting bonus payments to encourage employees to return to work.
How quickly the US recovers from its public-health and economic crises will also depend on how well other countries handle them, and vice versa. The World Bank expects 93% of countries to slide into recession in 2020, the highest share ever.
Although the recent spikes in new COVID-19 cases and hospitalizations in the US appear manageable for now, given adequate provision of hospital beds and equipment, a significant worsening could trigger new shutdowns or stall further reopening. That would slow the recovery, resulting in economic despair and related health and social problems for many Americans.
Moreover, America’s twin crises have revealed longer-term problems, starting with the country’s inadequate stockpiles of medical supplies. California, for example, never maintained the supplies then-Governor Arnold Schwarzenegger built up to combat the 2002-03 SARS epidemic, and had to repair hundreds of defective ventilators. And state governments’ antiquated computer systems for processing unemployment claims and dispensing benefits buckled under the pandemic-induced strain.
In addition, the COVID-19 shock has shown that too many individuals and firms lack the financial margin to weather even a few months of lost income or revenue. It has also both highlighted and worsened racial disparities in health, income, and vulnerability to economic and health shocks.
These crises elicited massive, rapid, and unprecedented interventionist responses. But government responses enacted under exigent circumstances must control costs better and restore private incentives in the longer term, because history shows that, once launched, public programs and interventions seldom end.
The economic and health recoveries also heavily depend on the actions of businesses, citizens, and schools, including whether they adhere to recommended precautions such as social distancing, frequent hand washing, and wearing face masks. It remains to be seen whether firms can survive with restrictions on employees and customers, and whether the accelerated digital transformation will be a net plus. The other danger, of course, is a large second wave of the virus that overwhelms hospitals and scares away employees, students, and customers.
One bright spot has been the rapid pace of adaptive innovation. Most US schools quickly continued teaching online following the shutdown, while telemedicine has boomed, helped by the relaxation of government pay restrictions and rules prohibiting inter-state medical consultations. And medical researchers quickly refocused on COVID-19 testing, therapeutics, and vaccines: human trials have started for several promising vaccines, and new tests may be deployed before winter. For the first time, vaccine production capacity will be ramped up simultaneously with testing, so that any safe and effective vaccine that emerges will become available far more quickly.Sign up for our weekly newsletter, PS on Sunday
But the longer-term problems revealed by the pandemic and the recession will not disappear when these crises end. True, before COVID-19 struck, things finally had started looking up for lower-income workers. Minority unemployment was at an all-time low, and wages were rising most rapidly at the bottom of the pay scale. But while strong economic growth will be needed to ensure that these trends resume, there are pockets of people who have been left behind.
To address this requires reinvigorating policies to broaden school choice, bring private jobs and capital to depressed areas, and ensure better job training (including more apprenticeships and job matching), as well as taking a new approach to overlapping means-tested anti-poverty programs. US welfare recipients face extremely high implicit marginal tax rates in terms of the benefits they lose if they work, with many standing to earn less if they worked than if they remained on the several overlapping programs.
It is extremely difficult to predict the speed and strength of the US economic recovery with any certainty. What is clear, however, is that we must boost incentives to work in normal times when jobs are plentiful, while strengthening the safety net for when they are not and for those who are unable to work.
Column: How a microbe will decide the 2020 election
On March 18, at a press conference flanked by high-ranking officials, President Trump described himself as a “wartime president” fighting an “invisible enemy” known as the coronavirus. The president, it seemed, was beginning to reckon with the extent of the economic, epidemiological, social, and psychological damage the pandemic would cause, and to act appropriately. “We must sacrifice together,” Trump said, “because we are all in this together, and we will come through together.”
An anxious populace welcomed the appearance of a strong leader at a time of national emergency. The president’s job approval ratings rose in the following weeks, reaching a high of 47 percent in the Real Clear Politics average on April 1. The gap between Trump and former vice president Joe Biden narrowed to five points.
How long ago that seems. Some 122,000 deaths and tens of millions of lost jobs later, and in the middle of a cultural revolution sparked by the viral video of George Floyd’s death at the hands of Minneapolis police, President Trump finds himself backed into a corner. The rhetoric of a wartime presidency is gone. His coronavirus task force is barely visible. In a symbol of declining levels of support among white voters critical to his reelection, attendance at the Keep America Great rally in Tulsa failed to live up to expectations raised by Trump’s own campaign. The president’s job approval rating has fallen to the low 40s. Biden’s lead has widened to 10 points.
There is no shaking the coronavirus. It is the ever-present backdrop against which our national nervous breakdown is taking place. The good news is that deaths have declined to fewer than 1,000 per day. But that number is still higher than the casualties reported by other liberal democracies in Asia and in Europe, and it may rise in the coming weeks. Sclerotic bureaucracies, poor decision-making, and ill communication at every level of government wasted the opportunity to suppress the virus through relentless testing, contact tracing, and quarantine.
By the time testing ramped up to the point where it could become the centerpiece of a suppression strategy, Americans had grown tired of lockdowns enforced throughout the country without regard to local conditions and to basic freedoms, and weary of a public health establishment whose pronouncements—New York good, Florida bad; protests good, yeshivas bad—seemed driven by partisanship and ideology.
The virus exposed racial, ethnic, and class cleavages that inflamed elite opinion and increased demands for social justice. And the economic devastation left an environment permeated by anxiety and filled with bored and unemployed people, some of whom felt as if they had no stake in the system and no reason not to smash things. The civil unrest of the past month has analogues in earlier pandemics. Local, state, and federal leaders met the disorder with the same woolly-headedness, indecision, posturing, and lack of compassion that they have applied to this one.
Trump has tried to reinvigorate his candidacy by resuming a normal schedule. Recently, in addition to Oklahoma, he has traveled to Arizona and Wisconsin, but at each stop he has run up against the agent of his electoral distress: the plague.
The arena wasn’t full in Tulsa because of a justified fear, on the part of some who otherwise would have attended, of participating in a large gathering in an enclosed space. During his monologue the president remarked, as case numbers rose in 29 states, that he had told his team to “slow the testing down please.” The content of his speech to a youth group inside a Phoenix megachurch had to compete with questions over how widely face masks were distributed among the crowd. As the president traveled to Green Bay for a town hall with Sean Hannity, Texas governor Greg Abbott paused his state’s reopening and halted elective procedures at hospitals in four counties.ADVERTISING
The spread of the virus results in panic, and the panic results in economic losses, social isolation, and polarized media and culture primed for incitement. That is why 80 percent of registered voters say the country is out of control, why 68 percent say the country is on the wrong track.
What the coronavirus has done is rob President Trump of his ability to control events. The president has a knack for putting his human opponents on their toes, for establishing facts on the ground that are difficult to contest. But the coronavirus doesn’t read Tweets, doesn’t watch television, and doesn’t go away if ignored. It has to be defeated, or endured. America prides itself on having a government of, by, and for the people. But here, today, the virus rules.
After months of sheltering in place, Americans are finally returning to their favorite restaurants, stores, and barbershops. As of June 1, all 50 states have started to reopen.
We may not know what life after the coronavirus looks like, but one thing is certain. As life returns to normal, millions of Americans will rely on natural gas to refuel their cars and reopen their businesses.
Fortunately, America’s energy sector was well prepared to survive the coronavirus outbreak. Having weathered the storm, natural gas producers will help get the economy humming in a way that benefits American consumers and the environment alike.
COVID-19 certainly caused problems for America’s energy sector. But even despite these recent setbacks, natural gas has proven quite resilient. U.S. natural gas prices have remained relatively steady over the past few months. And the U.S. Energy Information Administration expects average natural gas consumption to fall by less than 4 percent this year.
This shouldn’t come as a surprise. America’s shale energy boom helped make natural gas the leading source of electricity nationwide. More than 38 percent of the nation’s power came from natural gas in 2019. With demand expected to rebound as early as next year, it seems like natural gas will remain the nation’s go-to energy source for the foreseeable future.
That’s great news for Americans. Ever since the United States became the world’s leading producer of natural gas, households across the country have seen their energy costs plummet. Americans will continue to benefit as the country grows more reliant on natural gas. Low gas prices will add $2,700 to the average household’s disposable income this year, according to an analysis from the research firm IHS. That number is expected to rise to $3,500 per household by 2025.
By moving the country away from coal, the natural gas boom also helps the environment. Last year, America once again led the world in reducing energy-related CO2 emissions. Between 2000 and 2019, the United States achieved a whopping 1 gigaton emissions reduction — more than any other country during that period.
These environmental gains will continue as gas-fired plants displace more of their coal-fired counterparts. The EIA projects that domestic energy-related CO2 emissions will keep falling well into the next decade.
America’s energy renaissance has even helped Europe reduce its emissions. Thanks to record-high natural gas imports, Europe saw a 15 percent increase in power generation from natural gas in 2019 — and a 20 percent decrease in the use of coal. Unsurprisingly, the European Union and the United Kingdom saw a 12 percent decrease in power sector CO2 emissions last year. Globally, CO2 emissions flattened in 2019.
Such a sustained drop in global carbon pollution would have been unthinkable just two decades ago. But thanks to the natural gas renaissance made possible by hydraulic fracturing, reductions like these have become the new normal.
It will take a lot to recover from the economic disruption of COVID-19. But come what may, the country can rely on natural gas to power the economy and clean up the environment.
President Donald Trump has so much on his plate right now, it’s difficult to see how he prioritizes the actions he must take for the country’s good. There’s so much going on in so many different areas it’s hard to recall any president in recent memory having to face so much at any one time at any one time.
All presidents must deal with crises. How they lead is part of the way we judge their fitness for office. And there are a lot of folks who say his leadership lately has been lacking as the nation deals with the novel coronavirus.
That’s remarkably ungenerous. The president mobilized the federal government and private industry to respond in ways not seen in decades. It’s impossible to be certain but is nonetheless highly likely the interventions he led produced faster testing on a broader scale, more ventilators than needed, and helped keep the spread of COVID-19 under control.
We may never know. All the models produced by the so-called public health experts working in the smart institutions were way off, even when early-stage interventions are accounted for. Meanwhile, as the result of actions taken by many of the nation’s governors, mostly in blue states, the U.S. economy tanked, a record number of jobs were lost in a single month, and Congress spent so much money on relief that might not even have been necessary it will take at least a decade of above-average economic growth to recover.
For the immediate future, President Trump would be both politically smart and doing the best thing for the country if he focused on measures to get the economy open and off its back. Businesses need to reopen. Lockdowns, if they are needed again (if a still-at-this-point hypothetical second wave hits), need to be localized, targeted, and well thought out. People need to get back to work, pay down their debt, and start saving again.
Several steps can be taken to help bring about the V-shaped recovery most everyone is hoping for. There are lots of positive indicators in the economy that its possible. Every policy decision from now until at least the end of summer ought to be taken specifically to enhance the possibility that will occur.
Just as the president was right to postpone tax filings and payments from April 15 to July at the height of the crisis, he would be right to have Secretary of the Treasury Steve Mnuchin tell the U.S. Internal Revenue Service to postpone the payment of those taxes until sometime in 2021.
The economy has just started showing signs of life. Taking $1 trillion out of it – which is what it would be if all the federal personal and corporate income taxes, estimated payments for the self-employed, federal excise taxes, the taxes paid by job-creating small businesses, and the outstanding balance due on returns from prior years – would almost assuredly plunge it back into a recession and push the recovery off by months.
The National Bureau of Economic Research says the recession caused by the lockdowns resulting from the coronavirus panic started in February. The NBER – and they’re the ones who get to make the decision – called it steep but short-lived. July 2020 should be a month of recovery because of strong, perhaps stronger than normal, economic activity. But that only happens if people are engaged in productive activity, buying and selling goods and services in the marketplace rather than sending Uncle Sam back a good chunk of the so-called stimulus.
Several prominent economists have endorsed this idea as being curative. Influential political groups including the National Taxpayers Union and Americans for Tax Reform have also signed on. The president and Secretary Mnuchin have it within their power to make this happen. They should order it be done with all dispatch. Certainty is important as businesses plan what to do next, whether to hire or fire, whether to stay open or close, and whether to expand. Knowing that the taxes due would not have to be paid until sometime early next year gives them that much more time to use their available cash to put people back to work. Making America Great and Keeping America Great can only be accomplished if America is working.
Critics say law will exacerbate $54 billion deficit, economic downturn
California Democrats allocated $20 million in a recently passed budget to enforce a controversial labor law that some experts say has hampered the state’s economy and pandemic response.
The budget, which passed the Democrat-controlled state legislature on a party-line vote, provides $20 million to enforce Assembly Bill 5 (AB5), a law that limits employers’ ability to classify workers as independent contractors. The money is divvied up between three state agencies—the Department of Justice, Department of Industrial Relations, and Employment Development Department—to conduct audits, carry out prosecutions, and levy fines and penalties on employers. Republican assemblyman Kevin Kiley said that ramped up enforcement will only hurt businesses struggling in the wake of statewide shutdown orders tied to the coronavirus.
“That’s what the money is for, specifically—to go after small businesses and independent contractors at a time when they’re struggling more than they ever have before,” Kiley told the Washington Free Beacon.
The budget provision comes as the state faces an impending $54 billion fiscal deficit. Democratic governor Gavin Newsom revised his initial $222 billion budget proposal in May, saying that he would fund only the “most essential priorities.” The $20 million allocated to enforce AB5 survived the chopping block in the $143 billion budget passed by the assembly and state senate. Newsom, who did not respond to a request for comment, slashed education funding and said that first responders would be “the first ones to be laid off.”
The budget proposal sparked criticism from House Minority Leader Kevin McCarthy (R., Calif.), who said that the proposal will hurt his constituents. He called the multimillion-dollar allocation for enforcement “disappointing, but not at all surprising.” He criticized state leaders for misplacing their priorities and refusing to adapt to the economic challenges brought on by the pandemic.
“Gig economy workers have felt the ramifications of this legislation for months now, and the coronavirus pandemic has only made securing work that much more difficult,” he told the Free Beacon. “California’s independent contractors deserve a government that can adapt to unanticipated challenges, not one that exacerbates problems by continuing to pursue a half-baked idea.”
Democratic leadership in the state assembly and senate did not respond to requests for comment.
Newsom in April rebuffed calls from state and federal legislators, small business owners, and more than 150 economists to suspend AB5, touting the law as an example of the state’s national leadership. Under AB5, employers must meet strict requirements in order to classify their workers as independent contractors. Its 2019 passage led to widespread layoffs as businesses struggled to afford the increase in legally imposed labor costs. Experts argue that the law has made it nearly impossible for unemployed workers to take on temporary jobs from home, further exacerbating the economic downturn caused by the pandemic. More than 5.4 million Californians have filed for unemployment—more than the population of 28 states.
“You’d think at a time when we shut down small businesses for months, we’d be doing everything we can to help them out,” Kiley said. “It’s a failure to understand the need of the moment, which is to propel economic recovery, to help small businesses get back on their feet, to promote workers.”
Reallocating the $20 million set aside to enforce AB5 would hardly alleviate the state’s budget shortage—the Los Angeles Police Department alone has spent $40 million in overtime pay for officers handling ongoing Black Lives Matter protests. But according to Pacific Research Institute fellow Kerry Jackson, Newsom’s refusal to suspend AB5 has contributed greatly to the fiscal crisis, and stricter enforcement will only exacerbate the problem.
“The pandemic lockdown dried up tax revenues because so many jobs were lost. Some of the lost revenues could have been made up if those who’d been laid off had been able to work as independent contractors,” Jackson told the Free Beacon. “But the law made it illegal for them to work. So no work, no income tax revenues.”
While Monday’s budget is unlikely to be signed by Newsom in its current form, the governor’s own budget proposal also includes $20 million to enforce AB5, meaning the money is unlikely to be cut. Kiley said that Democrats’ unwillingness to budge on the law reflected the power of special interest groups in the state—AB5 was written by the AFL-CIO, the country’s largest federation of labor unions.
“Unfortunately, so far there hasn’t been any movement towards doing away with the $20 million or redirecting it somewhere else,” Kiley said. “It shows how influential these special interests are, that the governor and the legislature will not budge, no matter how strong the arguments are for doing things differently.”
Newsom has until June 30 to sign the budget into law.
A barber who had been cutting hair for more than 50 years never set out to make a stand. He just wanted to pay his bills.
When Winerd “Les” Jenkins first became a barber, Neil Armstrong hadn’t yet set foot on the moon. For over five decades, Jenkins has made a living with his scissors and razor. For the past decade, he’s worked his craft from a storefront in Inwood, West Virginia. At Les’ Place Traditional Barber Shop, you can get a regular men’s haircut for $16 and a shave for $14—but come prepared to pay the old-fashioned way: in cash.
His insistence on “cash only” isn’t the only thing that’s old-school about Jenkins. He lives with his wife of 52 years on a small farm, where the couple raises rescued animals. He believes in paying his bills on time. He doesn’t use the internet, email, or text messaging. And he’s skeptical that his profession can become illegal overnight merely on the governor’s say-so.
This combination of old-fashioned values led to the soft-spoken barber’s arrest this spring. His story shows how governments’ uncoordinated coronavirus response has caught working Americans in its crossfire—and how the apparatus of occupational licensing has functioned as the state’s enforcement mechanism to shut down small business.
When Les Jenkins first heard about the Wuhan coronavirus, his first concern wasn’t for his own livelihood but that of his wife, Sue. She is medically fragile, on oxygen after an illness left her with Chronic obstructive pulmonary disease (COPD) several years ago. “I thought long and hard about whether I should risk taking the virus home to her,” Jenkins told me. “But this is my only real source of income.”
Even before the state of West Virginia began issuing mandates to contain the virus, Jenkins was already putting his own protection measures in place for Sue’s sake. He wore a mask and gloves, sanitized tools and surfaces, and changed clothes upon coming home every evening.
On March 19, West Virginia Gov. Jim Justice ordered all hair salons and barbershops to close. Most salon owners got the message through the media. The West Virginia Board of Barbers and Cosmetologists (WVBBC) published guidelines on its website but didn’t proactively contact its license-holders.
“The West Virginia Board of Barbers never sent me any written instructions, never called, never sent an inspector to tell me to close,” Jenkins said. “The fellow who works with me saw it on the internet and told me about it.”
Jenkins initially complied with the order, using the time off to make renovations to his store. “After about three weeks, money started getting pretty tight,” Jenkins told me. At his local bank, he was turned down for a Paycheck Protection Program loan, due to operating an all-cash business. He called Workforce West Virginia to apply for pandemic-related unemployment assistance. “The unemployment office told me that in order to get assistance, I had to provide evidence that I’d been ordered to close.”
On April 10, to get the documentation needed for unemployment, Jenkins wrote to the WVBBC, requesting a signed letter to confirm the governor’s closure order. He never received a reply.
By the time two more weeks had gone by with no income, Jenkins was in real fear of losing his home, farm, and business. “I’m 72 years old,” he told me. “What else am I going to do if not this? Who’s going to hire me?”
On Wednesday, April 22, Jenkins quietly opened his shop and cut hair for seven customers—all walk-ins, including several police officers. It would be his only day in operation. The next morning a WVBBC inspector came to the door. “I’ve known her for years, and we talked for a little while about her family,” Jenkins said. “Everything was cordial.”
The inspector told Jenkins the WVBBC had received a complaint the prior week from another local hairstylist, contending that Jenkins was open for business during the shutdown. Jenkins denied seeing customers at the time of the complaint—he was in his shop making renovations—but he admitted to being open the previous day.
He told the WVBBC inspector that he would be willing to close his shop if she would provide him with a copy of the governor’s closure order, signed for verification. The inspector returned to her car. “I assumed she was going to get the letter I had asked for,” Jenkins recalls. Instead, she was calling the sheriff. Two deputies promptly arrived.
After some back-and-forth between the sheriff’s deputies, the state inspector, and the barber, things came to an impasse. “Mr. Jenkins stated that so long as [the inspector] provided him with a copy of the governor’s order with her signature, in writing, he would agree to close his shop,” the sheriff’s deputy wrote in his arrest report. Although the inspector did print a copy of the governor’s order, she refused to sign it, saying that “she was instructed not to provide her signature on the documentation.”
After noting that Jenkins didn’t believe an unsigned document was sufficient, the deputy concluded: “Mr. Jenkins then asked if he may lock up his shop before being placed under arrest, and this deputy allowed him to do so.” Jenkins told me that “no one involved raised their voice or said anything detrimental. Everyone was cordial, professional, and polite.” Nothing in the officer’s report contradicts this characterization.
Jenkins spent three hours in a holding cell before being charged with obstructing an officer and released on a $500 recognizance bond. The misdemeanor charge carries a possible sentence of $50-$500 in fines, and up to a year in jail. Jenkins also worries about potential punitive actions from the WVBBC, which could include fines, suspension, or revocation of his license.
Today, Jenkins is working again, making up for lost time after six weeks without an income. He never did succeed in obtaining any government financial assistance. “I don’t know if I would have qualified for unemployment,” he told me. “But they wouldn’t even give me the opportunity to try. One bureaucracy dealing with another doesn’t work.”
It’s unclear why the unemployment office told Jenkins he needed to prove he’d been ordered to close his business. Workforce West Virginia did not respond to a request for comment. However, in interviews, other self-employed West Virginians attested to a disorganized, confused, and delayed response in receiving pandemic-related unemployment assistance. The Workforce West Virginia website currently contains a notice that its “systems are experiencing intermittent disruptions and temporary outages” due to overwhelming demand.
It’s still less clear why the state licensing board was unwilling to issue a signed letter at Jenkins’ request. The WVBBC proved far more interested in catching Jenkins breaking the governor’s order than it was in helping him abide by it. Rather than simply provide a document to help one of its barbers obtain assistance from another state agency, the bureaucrats at the WVBBC preferred to see the 72-year-old business owner leave his shop in the back of a police car.
The WVBBC—which did not respond to multiple requests for comment—is just one of an entrenched network of state occupational licensing boards in West Virginia. Last year, the Cardinal Institute for West Virginia Policy released a study comparing the state to two of its wealthier neighbors, Ohio and Pennsylvania. Not only does West Virginia have the most licensing boards of the three, but it also has generally higher fees and more onerous licensing requirements.
Garrett Ballengee, executive director of the Cardinal Institute, doesn’t believe an entity like the WVBBC even needs to exist. He notes that while approximately 5 percent of occupations required licenses in the 1950s, today that number stands at higher than 25 percent. “It’s a protectionist racket,” he says. “If we’re going to have an entity like this for barbers and hairdressers, it should provide voluntary certification or consultative services. It certainly shouldn’t be an extension of the legal system, which it clearly is.”
Indeed, in many states, occupational licensing boards have been a key enforcement mechanism for governors’ shutdowns of small businesses. For instance, Michigan’s own shutdown-defying barber has already had his license suspended. Fortunately, under the direction of President Trump, the federal government has been working to relax the regulatory burden on businesses and restart the national economy. State governments should follow this lead. The last thing small business owners need is to be worried about heavy-handed bureaucrats looking to set examples.
As for Jenkins, he has now hired an attorney from his own pocket, helped out by a few donations from the community. “I don’t want to go to jail for a year,” he told me. “I don’t want to lose my barber license. They’ve got the power over me; they’ve got lawyers funded by the state. I never set out to make a statement or a stand. I just wanted to pay my bills.”
Congress spent too much money trying to keep the economy afloat during what looks to be the increasingly ill-advised coronavirus lockdown. The effort to flatten the curve to keep hospitals from being overwhelmed quickly transformed into something more that is only now, and mostly in the so-called red states, easing up.
To cushion the blow, the House and Senate passed, and President Donald Trump signed legislation distributing trillions of dollars, many of which had little, if anything, to do with COVID relief. One of the most objectionable, one that distorted the labor market badly, was the provision guaranteeing a “temporary” $600 weekly bonus on top of regular unemployment payments for workers state government decided needed to stay home in the interest of public safety.
For more than a few of them, that bonus lifted their unemployment income above what they’d been making on the job. Stories about the difficulties involved in getting these people to come back to work are already legion and will continue to be so, especially as House Speaker Nancy Pelosi and the Democrats have made the extension of unemployment benefits and bonuses a priority for the next round of relief.
If there’s a more stupid idea out there, it’s hard to find. Paying people to stay home is about as silly as paying farmers not to grow anything—yet that was a hallmark of U.S. agricultural policy starting with the Great Depression and continuing through to the Clinton years, when Newt Gingrich’s Contract with America Congress put a stop to it. At least for a while.
Unfortunately, foolish ideas abound among legislators, even well-meaning ones like former House Ways and Means Committee Chairman Kevin Brady. The Texas Republican, who is now the committee’s ranking member, is proposing a $1,200 back-to-work bonus to get the economy moving again.
His plan, which he’s calling the Reopening America by Supporting Workers and Businesses Act of 2020, would cost less than some of the items on Pelosi’s wish list, but that may be the only thing about it that’s virtuous. Brady says he’s “trying to help Main Street businesses rebuild their workforce by turning unemployment benefits” into an incentive for workers to return to the job.
He says that will accelerate the economic recovery. Call me doubtful. As Nobel Prize–winning economist Milton Friedman and others have consistently argued, the money that comes out of the private economy does not produce as much growth as the money that never leaves it. The Brady plan is a circular exercise, with the government taking money from the earnings of workers and businesses through taxes and then giving it back to them as a “re-employment benefit.
Outside Washington, the argument that the answer to the problems created by subsidizing unemployment lies in a program to subsidize re-employment would be met with silent stares—justifiably so. Letting the bonus expire, as it will do under current law, would be a good fix in the short-term, but politicians need greater guts than many of the current crowd seem to have to oppose the extension of unemployment benefits when so many of them have filed for them since mid-March.
The difference between now and what is usually the case, however, is that in the main jobs are there for the taking. The unemployment we’re currently experiencing results from the COVID lockdown, not a business downturn that occurred for any of the usual reasons. Bolder, braver initiatives are called for.
One that’s one the table, which some in the White House like but the bean counters at Treasury hate, is a partial payroll tax holiday running from March 1 (when the lockdown started to approach peak levels) and the end of the calendar year. All in, including the deductions for Medicare and Medicaid along with what’s taken out for Social Security, that gives business owners a little over 15 percent of wages up to $137,000 out of which they can incentivize workers returning to work on broad terms and still have something left to help cushion them from the economic blow the lockdown caused.
The arguments against this plan are few and come mostly from the usual suspects. Some say it would jeopardize the health of Social Security, but as the so-called “trust fund” is mostly an accounting fiction, most of the money comes from general revenue. Others argue it would add precipitously to the deficit, which may be but not by more than what Brady, Pelosi or anyone else is proposing. Most of the politicians who hate it do so because it means they’re not in the position to ride to the rescue by passing out relief. That’s a silly reason to reject a good idea. Help the country. Do the payroll tax holiday legislation. Then go home.
If we’ve learned anything from the COVID-19 virus, it is that dependence on the Communist country is dangerous. For example, the Chinese authorities stopped a ship in transit filled with paid-for medical supplies at a strategic moment, hoping to hold us hostage. The Communist regime mixes all Chinese businesses with its military objectives using economics, trade and a growing dominance in the high-tech world to make their power and military might in the world greater.
That party has even bragged of its future capacity to attack and defeat the United States during an international pandemic. We must understand therefore that China isn’t merely a trading partner, it is also a dangerous international enemy. In response, we must always maintain a strong military. That is obvious. But what may not be quite so obvious, but every bit as important:
We must maintain our high-tech advantages and not make ourselves dependent upon a hostile power.
The Trump administration has been aware of these risks and has taken steps to stop China’s high-tech adventurism.
The administration recently enacted restrictions on Chinese tech company Huawei, which is infamous for placing backdoors in their chips so that the communist regime has control over any device with Huawei chipsets. This alone should make it clear the U.S. can never allow itself to become dependent upon China for its technology. Imagine American fighter jets, radars and missile defense that would work only if the communist regime in China decided not to switch them off.
This is why it seemed to be good news when the world’s third-largest chip maker, Taiwan Semiconductor Manufacturing Company (TSMC), and the Trump administration recently announced TSMC’s plans to build a large chip manufacturing facility in Arizona, bringing in over 1,600 good-paying high-tech jobs. It also puts a major chip manufacturing facility on U.S. soil.
If we look more deeply into the details though, there is lot that needs to be improved if this deal is to truly advance America’s economic and security interests.
First, the deal would build a factory that when complete will be building yesterday’s chip sets. The factory is currently planned to make 5 nanometer chips. But the next generation 3 nanometer chips are just a few years off. Given that the factory won’t be fully complete until 2030, it should be built to manufacture the highest tech chips — not ones that will be a generation behind by then. The 5 nanometer chips may still be used widely in consumer electronics in the future, but they won’t be the most powerful, efficient and capable chip sets needed for the most demanding applications.
Bottom line: We won’t be getting a facility capable of manufacturing the highest tech chip sets that will be needed in the future. However, TSMC is updating some of its facilities in Asia to build these next generation 3 nanometer chipsets. So we should insist that if we’re going to build a chip factory in the U.S., it must be a top of the line, high-tech factory — not yesterday’s tech.
The planned factory would also have a relatively low monthly output capacity. Other TSMC factories can produce more than five times the monthly capacity of the proposed U.S. factory. If the planned factory is too small to truly act as a counterweight to China’s plans or to make us truly independent of China’s high-tech tentacles, it doesn’t actually do that much to make America stronger or safer. We should insist therefore that the factory capacity be expanded to make it a true counter-balance to China’s aims.
Here is a solution to all of these concerns — the U.S. requires TSMC as a condition of the deal to form a joint venture with an American firm. It could increase the available funding to build a factory capable of manufacturing the latest and greatest and most powerful chipsets. Moreover, it would allow the factory to be built bigger so that its monthly capacity qualifies it as a true, cutting edge “Gigafab” facility. And finally, a joint venture with an American firm would insulate the venture from China’s active efforts to co-opt strategic businesses and thereby make America and others dependent or at risk to China’s designs.
The Trump administration is smart to build positive relationships that strengthen America and reduce our dependence upon China. But the details matter, and the deal with TSMC needs some serious improvement if it is to truly end our dependence on high tech semiconductors that are within China’s orbit. The last 30 years have been disastrous for American manufacturing. China has been the primary beneficiary of those wrong-headed policies, taxes and regulations that drove business overseas. Hopefully, the COVID-19 virus has woken us up to the malignancy of the communist regime and the risks of relying up on it for things that are fundamental to our security.
Recovery in parisan crosshairs; New conspiracy evidence; China fighting back!
As if quarantine and recovery were not enough to worry about, Americans have other headlines competing for our attention. Most tiresome is the conflict between those who want to resume economic activity as much as possible and those who don’t. At issue is the frustration experienced by everybody at the lifestyle we have been forced to adopt because of the threat of the COVID-19 pandemic – everybody staying home while their jobs and earnings dwindle away.
Recovery in partisan crosshairs
A vocal minority has rebelled openly against the closed-door policies of many jurisdictions which have been slow to authorize the back-to-work recommendations of the President. Some are claiming that these restrictive mandates violate the basic rights guaranteed by the Constitution. Others are desperate for an income, still others are just tired of the inactivity. None of this is too surprising given the circumstances.
The surprising part comes when many leading Democrats began advocating the stay-at-home crowd, claiming that the plague is still too widespread to admit the proximity of daily life encounters in businesses and churches. They blame President Trump for sloppy management of the national response, apparently because he has instituted a “go-local” approach economic recovery.
They claim that there should be a “one size fits all” federal policy for the recovery, even though there is a vast disparity between the various local circumstances. This is not really a credible solution to the problem of managing the national opening of doors. But it gets serious when the House of Representatives passes a bill aimed at financially supporting the closed economy in the name of public safety from the virus. How do you deal with ridiculous proposals which are advanced by one of the highest authorities in the land?
New conspiracy evidence
Then, just when we are beginning to deal with that idiocy, we find out that President Obama may have been intimately involved in the attempted overthrow of his successor. The Dems are losing their minds over this one. The current administration has released some very incriminating documentation of testimony kept hidden for as long as two years by Adam Schiff, Jerrold Nadler, and Nancy Pelosi. These documents in effect begin to substantiate the assumptions of the President’s supporters that the attempted coup d’état which led to the impeachment trial of Donald Trump was in fact a treasonous conspiracy to overthrow the legitimately elected President of the United States.
China fights back
This is very serious stuff, but it is hard to concentrate on it when you are facing financial ruin because of a lost job or business. But if you are able to devote sufficient attention to these two political issues, there’s still another one brewing which is equally important but just about, as they say, “a bridge too far”. This is the mounting tension between the USA and China. The war of words is getting more and more aggressive. More importantly, the Chinese are increasing their military threats to American shipping and air surveillance. Unless cooler heads prevail on both sides, this is the kind of rhetoric that can lead to war.
America is already taking on many of the policies which characterized our Cold War with Russia for two generations. But China is a different opponent. It is better positioned to engage in an economic and diplomatic rivalry not only because of the leverage of its huge market, but also because it is much more familiar with the intricacies of the American corporate and technological infrastructure, having worked closely with American firms and government departments and personnel (including Joseph Biden and family) for the past forty years (since the collapse of the Soviet Union).
Those relationships are wide and deep, including not only corporate partnerships but also generations of Chinese students educated in American universities, as well as the capture of America’s technological base, and the purchase of US public debt.
We do not want this cold war to turn into a hot war not only because of the tragic cost to all concerned, but also because it is not at all clear that we would ultimately win such a war. China’s space and long range weapons technologies are arguably superior to our own, especially since, unlike China, we have not been preparing for war over the past two decades and in fact let our military capacity deteriorate to an alarming extent during the Obama years. The Steve Bannon hawks need to think through again their anti-China positions before someone starts shooting. Yesterday’s fall of Hong Kong may be just the provocation to precipitate Western action. Things are getting very tense.
What can you do?
So, that is the menu of top issues facing America. The question is, how do we deal with all these problems? Do we just decide to let the powers that be resolve everything? Do we pick a cause and go all out to support it with demonstrations, social media campaigns, and all the modern communications technologies?
There is an ancient prayer which includes the words,” Lord, give me the strength to accept things I cannot change, the courage to change the things I can, and the wisdom to know the difference.” Good advice in these troubled times.
“This proposal is essentially reverse Robin Hood… Billions of dollars coming out of the pockets of working people and working families and it is transferred to the most fortunate in our country.”
Although those words from career politician Ron Wyden were intended to deride a Republican policy he opposed back in March of 2017, they instead perfectly describe a proposal he himself put forth in March of 2020. Senator Wyden recently sponsored an amendment to save taxpayer-funded subsidies for luxury electric vehicles [EVs] often enjoyed by ultra-rich multimillionaires like himself.
For more than a decade, the working people and working families that Senator Wyden claims to fight for in Washington have collectively been forced to help contribute up to $7,500 for every EV sold in America – that is, until each manufacturer sells 200,000 units. As one of Wyden’s Senate colleagues, Wyoming’s John Barrasso, notes, between 2011 and 2017, EV buyers therefore received a total of $4.7 billion in tax credits. The bipartisan Joint Committee on Taxation, meanwhile, estimates that the credit will cost taxpayers $7.5 billionbetween FY2018 and FY2022 alone in its current form.
Given the tremendous amount of taxpayer assistance the industry has already received, its response to the foregoing phase-out period should be rooted in gratitude rather than greed. But these billions are apparently insufficient for colossal electric car corporations hoping to sustain their taxpayer-funded windfall from Washington for as long as professional politicians like Ron Wyden will permit. Accordingly, in an act of total contempt for his middle-class constituents, Senator Wyden is working to deliver an additional $16 billion to these carmakers’ coffers over the course of the next decade – a product of the industry’s relentless lobbying push to lift the aforementioned limit up to 600,000 units as more and more EV manufacturers prepare to join giants like General Motors and Tesla in outselling their caps.
While a $7,500-per-vehicle tax credit may sound like pocket change to the sixteenth richest lawmaker in the United States Senate – back in 2016, Wyden had an estimated net worth of nearly $10 million – it is a significant sum to the working people who must subsidize the purchases of his prominent pals in the top 1 percent. Yet, this precise group of people is priced out of very luxury cars they help finance as “the median price for electric vehicles is roughly $20,000 more than the median price of gas-powered cars.” Per a recent reportreleased by the nonpartisan Congressional Research Service – which is widely considered to be Congress’s think tank – “EV tax credits are disproportionately claimed by higher-income taxpayers.” More specifically, “most of the tax credits (78%) are claimed by filers with adjusted gross income (AGI) of $100,000 or more, and those filers receive an even higher proportion (83%) of the amount of credits claimed.”
Additional data about the income demographics of those who most frequently claim the credit make clear that EVs are taxpayer-funded toys for wealthy people like Wyden:
– A 2018 Pacific Research Institute study found that “79 percent of electric vehicle plug-in tax credits were claimed by households with adjusted gross incomes of greater than $100,000 per year”;
– The 2017 U.S. Department of Transportation’s National Household Travel Surveyrevealed that “about two-thirds of households with [battery electric or plug-in hybrid electric vehicles] have incomes higher than $100,000”;
– In a 2017 CarMax/CleanTechnica survey, 17 percent of households with EVs – the largest share of any income bracket – earned $200,000 or more the previous year; and
– Energy economists at the University of California, Berkeley concluded that “the top income quintile has received about 90% of all [Qualified Plug-in Electric Drive Motor Vehicle Credits].”
Setting aside the EV subsidy program’s disturbing proneness to fraud and abuse – late last year, a government watchdog concluded that “bogus electric vehicle tax credits” cost taxpayers tens of millions of dollars – it can clearly be called a failed subsidy program because of the disparity between those who are fortunate enough to claim the credit and those who are compelled to contribute to it. As Senator Wyden so aptly put it, “this proposal is essentially reverse Robin Hood” because it redistributes precious resources from working people to the wealthy; from his middle-class constituents to massive EV corporations.
Eliminating, rather than extending or enlarging, the EV tax credit is clearly the proper course as Congress considers its path forward. Let’s pull the plug on this welfare program for the most affluent among us.
Look past the words at the actions
As the saying around Washington goes, “President Donald J. Trump frequently steps on his own message”. Nowhere is that observation more accurate than in the matter of his leadership during the current crisis. His verbal descriptions of the steps he has taken and the reasons for each step sound a lot like bragging – even, at times, a plea for credit. But in few cases do they clearly and accurately convey either the obstacles or the strategy that led to these decisions – both of which have been significant.
Let’s do a brief recap. The COVID-19 pandemic has thrown the country into the worst crisis since Pearl Harbor. The President started our national response virtually alone. As the crisis began to take shape, he enlisted the aid of the public health experts, the national laboratories, the privately-owned laboratories, then the hospitals, the manufacturing industry, and so on, as new requirements arose, one after the other. When called upon, these Americans put aside their personal feelings and opinions about politics and proceeded to perform nearly miraculous feats –as when the Army Corps of Engineers created a hospital in Central Park in three days!
What inspired this sensational cooperation? Trump’s mixture of salesmanship and pressure. The appeals of the President to the patriotism of the participants would not have been sufficient to effect the desired outcomes had the President not presented each group with specific, well-thought-out tasks which fit the capabilities of each party. This is called detailed planning.
The result was that each party was asked to do something they knew how to do and were capable of doing. And, in problem after problem – from medical supplies to hospital beds to pharmaceuticals to supply chains to manufacturing — the results were astonishing.
Then the President organized the governors of the 50 states and the territories into the most important role they have ever played as a group – perhaps in American history! Even the bitterest critics of the President joined the coalition and developed a working relationship with the federal administration and the President and Vice President (a former governor). We witnessed the greatest example of federalism in the history of the Republic – James Madison would have been proud the see it in action.
And there were also side effects of this strategy. First of all, it was the most practical solution to the extremely complex problems of a national recovery which featured thousands of varying local circumstances and conditions. Clearly, the Democrats’ call for a “national” one-fits-all policy would not work.
But that observation reveals another side effect. By sticking to the Constitution, the President’s approach also made those criticisms of the opposition so obviously misguided that even the friendly Press disregarded them.
In all, we saw the most impressive example of presidential leadership perhaps since Franklin Roosevelt in 1933.
The Press, of course, missed this amazing spectacle which was unfolding before their very eyes. For the most part, those eyes were blinded by the same unthinking bias which had caused them to join the Dems’ insane attempt to overthrow that presidency earlier this year.
I have commented in the past that other speakers, such as Vice President Pence, frequently describe the President’s actions more clearly and convincingly than does the President himself. However, the forum does make a difference.
The President is very effective during his famous rallies in describing the mountains he has climbed as president and the results he has achieved. In fact, his ability to attract and entertain thousands of people in his rallies is unparalleled in modern politics. In this realm only entertainers can compete. This ability is so unique that any discussion of Donald J. Trump’s communication skills must begin with his rallies.
Next would be his set speeches which have improved with practice and since he learned to use the teleprompter. Finally, would be his impromptu press briefings on his way to the airport. But his formal press conferences not so much.
In the end, of course, as the Bible says, “By his works you shall know him.”
The United States of America is being tested acutely in the crucible of the COVID-19 emergency. This novel coronavirus outbreak has followed closely at the heels of perhaps the most grievous constitutional crisis in American history. Alternately dubbed “the Russia Collusion” or “the Russia Hoax,” this extremely well organized campaign to delegitimize the 2016 presidential election and its winner Donald J. Trump has been designed to upset the peaceful transfer of executive powers from one administration to the next.
Having started out with a huge bang and having been kept illegally alive for more than three years through the totally baseless Mueller investigation as well as the absurd impeachment proceedings in the House of Representatives, which ended with an embarrassing whimper in the Senate, the attempted coup d’etat by the Democrats against the duly elected President has demonstrated the fragility of the constitutional republic vis-a-vis the nefarious quest of a determined minority for absolute power over the majority.
The only true meaning of the constitutional republic and of its accompanying system of government called democracy is that through the eligible members of the whole society, the majority elects its representatives among those candidates who would govern according to their views, traditions, and morality. Therefore, the objective of democratic elections is to determine the present and future course of a nation, according to the mentality and the ideas of the majority and not to allow a minority to “fundamentally” change, experiment with, or overthrow the practical and spiritual realms of the nation.
On November 8, 2016, the Republican Donald J. Trump beat the Democrat Hillary Rodham Clinton by the electoral margin of 304 to 227. Put it simply, the majority of voters in the majority of states rejected the attempted overthrow of the constitution, its principles, and the Bible-based spiritual order of American society, with the vague notions of duplicitous social justice, fake human rights theories with their multiculturalism and non-existent “white supremacy” lies, economically destructive and baseless global warming hysteria, anti-religious revolution, and the already debunked utopian ideal of Marxism-Leninism-Maoism.
Prior to the 2016 presidential election, in the United States of America, the loser(s) accepted the verdict of the citizenry and organized itself to remain in opposition until the next election in four years. Meanwhile, this opposition labored hard on developing ideas and policies that would meet with the approval of the majority of the electorate. Clearly, constructive opposition has confidence that those ideas and policies are sound enough to win the next presidential election. However, when the opposition does not believe that its ideas and policies are winnable, the only way to gain the coveted political power is to delegitimize, or even to attempt overthrowing the legitimately elected president and his administration. The preferred methods are pseudo-legal, outrightly illegal manipulations with the help of corrupt civil servants, and defamation of character.
The Democrat Party and its representatives have been guilty of all of the above. Moreover, to achieve their illegitimate goals, they have enlisted the unelected and corrupt heads of several intelligence agencies, the equally unelected and corrupt heads of the premier law enforcement agency, the Federal Bureau of Investigation (FBI), as well as the overwhelming majority of the written and electronic media.
In the absence of a constructive opposition, America is devoid of a political middle. What the country has is an extremely radicalized Democrat Party on the proverbial Left, with its presumptive, washed out presidential nominee. On the other side, there is a sitting President fighting for his political future amidst increasingly strong headwinds.
Meanwhile, the victim of this abysmal situation is the United States of America and its citizenry. Judging by the wave of unconstitutional measures under the guise of saving lives at all cost, the Democrat governors and their colleagues in Congress again have been pursuing criminally destructive policies, in order to damage as much as possible President Trump in particular and the Republicans in general. From arbitrary prohibitions to idiotic actions they have been pushing ultrarevolutionary socialist and communist agendas to the detriment of democracy and the rule of law. The most glaring examples have been the violations of the First, Second, Fourth, and Fourteenth Amendments. While selling alcohol and drugs of all kinds as “essential” goods, churches and gun shops have been closed – supposedly for the sake of protecting the health of all Americans. Moreover, the House of Representatives, with its clueless Speaker, has been blackmailing the President and the Senate with her unrealistic economic and financial fantasies, and pursuing vehemently the release of President Trump’s tax returns. To add insult to injury, Representatives Schiff and Nadler have been searching feverishly for new phantoms, which might be grounds to impeach the President again. Finally, former President Barack Obama has shown a new small-minded and vindictive self. Attempting to destroy an American hero just because he hated him, and masterminding a coup d’etat against his successor, are vivid remainders of his true character.
Nobody is perfect. However, President Trump has been fighting against all odds to restore the constitution and the Judeo-Christian ethos of America. On the other side of the aisle, the Democrats have been waging a war against the nation, religion, and family. Their ideas and policies are bad, because they lead to faulty compromises. And bad compromises always end in bottomless vacuums, or hopeless cul-de-sacs. Yet, one could traffic in antithetical ideas but cannot play with contradictory emotions.
Tradition, religious spirituality, respect for the rule of law are the cornerstones of peace and stability in every society. Without those values, no great nation can endure long.