Monday, September 27, 2010

Stir the Pot

That's the point of social democracy: It's not just that working people get an extra chicken in the pot; more important, they get the right to stir the pot.

-- Thomas Geoghegan

In this week's Sift:

  • The Sift Bookshelf: Were You Born on the Wrong Continent? We Americans don't know much about how things work in Europe. We should. In an economy a lot like ours, ordinary people are better off. They have more free time, more access to high-quality public goods, and less to worry about.
  • Short Notes. Thomas Friedman explains why the Iraq War was "unquestionably worth doing". Katy Perry's video is banned on Sesame Street. If money is speech, three billionaires are speaking really loud. Democrats don't have to run wimpy campaigns. Jon Stewart examines the Republican "Pledge to America". And more.

The Sift Bookshelf: Were You Born on the Wrong Continent? by Thomas Geoghegan

Recent Sifts have focused a little too much on the downside: what's wrong, why it's wrong, and why it's so hard to do anything about it. How conservative propaganda works and why evidence doesn't seem to dent it. How the economy has been stagnating for everybody but the rich, and why a supposedly democratic system has been pushing that outcome.

Well, this week's book talks about how things can work better: the sick can get care, the old can retire in comfort, education can be free, cities can be safe and beautiful, and society can start re-orienting itself in a greener direction. And best of all, this isn't a happening in a visionary Utopia, it's happening in a continent: Europe.

The non-collapse of the European welfare state. Here in the U.S., we've been hearing for decades that the European system doesn't work and is headed for disaster. Back in the 70s, I saw a 60 Minutes piece about the crazy welfare state of the Netherlands, where all kinds of silly things were subsidized, taxes were spiraling upward, and soon no one would bother working because they could do just fine sitting around and collecting welfare.

You know how the Netherlands is doing, nearly 40 years after that dire assessment? Better than we are. Wikipedia lists 2009 per capita GDP according to three different sources: the IMF, the World Bank, and the CIA. The Dutch beat us in all three. Unemployment in the Netherlands is 4.8%, about half of our rate. And the unemployed Dutch are much better off than unemployed Americans, because … well, because the Netherlands is still a crazy welfare state.

Maybe over the years you've seen the same Europe-is-collapsing story about Sweden or Norway. They're doing fine too. Norway has 3.5% unemployment, Sweden 8.5%. Sweden's per capita GDP is a little less than ours, but Norway's is a lot more. (North Sea oil has something to do with that.)

America's conservative propagandists have realized that they can say anything they want about Europe, because most Americans will never go there. Most of the ones that do go will get their pictures taken in front of the Eiffel Tower or have a genuine Oktoberfest beer in Munich, but they won't learn the local languages, read the newspapers, talk to the natives, or learn much of anything about how the countries actually work.

So during the debate over the Obama health-care plan, we heard the most amazing things about socialized medicine in Europe: long waits for care, no access to the latest treatments, letting the old die to save money, and so on. Pretty much none of that is true, but who cares? You can say anything about Europe. (A fairer comparison of the U.S. and French health systems appeared in -- of all places -- Business Week. See this summary table. BW covered the waiting-time issue here.)

Germany and France. Advocates of American-style capitalism brush off the comparisons to small countries. Put together, Norway, Sweden, and the Netherlands have a population somewhere between Texas and California -- a little over 30 million. But Germany and France put together have about 150 million people, about half the size of the U.S.  Compare us to them, people say, and you'll see the American advantage.

Well, sort of. The U.S. is 11th on the CIA's per-capita-GDP list ($46,400), while France is 16th ($41,600) and Germany 18th ($40,700). The difference is even greater when the CIA figures in the over-valuation of the euro and other local factors to come up with something called "purchasing power parity" GDP. Since dollars are the measuring unit, the U.S. stays the same ($46,400), while France ($32,800) and Germany ($34,100) drop.

That extra $12-14K per person makes Americans better off than Germans or the French, right?

Not exactly. First you have to adjust for inequality -- our concentration of very rich people pulls up the averages without making life any better for the ordinary person. It's tricky to find the exact statistic you'd want, but this source does a reasonable job of estimating the median rather than the average. Now the US is at $37,100, Germany at $31,300, and France at $29,500.

So that extra $6-8K per person makes Americans better off than Germans or the French. Right?

Were you born on the wrong continent? That's where Thomas Geoghegan takes up the argument. He's a labor-union lawyer from Chicago who goes to France, spends some serious time in Germany, and then explains why life is better over there for ordinary people.

Before I get into his book, two caveats: First, Geoghegan writes in a chatty that-reminds-me-of-a-story style that you will either love or hate. So this is not a book you can hand to your conservative cousins, because they'll throw it down in disgust by about page ten. Second, I think Geoghegan's numbers are spun slightly -- not false, but not always measuring the right thing. (The difference isn't extreme -- about par for the course in books with a point of view.) So I've gone looking for my own numbers rather than just repeating his.

Geoghegan makes a few arguments to knock the numbers down, and then goes into intangibles. Let's start with the numbers.

First, the main reason the Europeans make less money than Americans is that they work fewer hours. They get more vacation, more holidays, and work less overtime. In 2004, the average American worker put in 1777 hours per year, while the French average was 1346 and the German 1362. So to get your household's extra $6-8K per person, the workers in your household each put in an extra 400 hours. (Picture a family with two working parents and two kids: 800 extra working hours produce about $28K more money.)

Geoghegan argues that even 400 hours is an underestimate, because Americans are pressured to put in off-the-clock hours, while Europeans tend to knock off early. Also, Americans are more likely to live in suburbs or edge cities from which they spend a long time commuting. Those don't count as working hours in the stats, but they're not free time either.

Public goods. Purchasing-power statistics underestimate the European lifestyle, because Europeans have access to high-quality public goods that are expensive for Americans to duplicate privately. (That's the dark side of President Bush's vision of an "ownership society".)

In America we are short-changed on public goods, though there are still enough around to make the point: I live in an apartment, so I have no yard and much less space for books than I would like. But two blocks in one direction is Mine Falls Park, where I once shot a blurry photo of a wild mink. Two blocks in the other direction is a very nice public library. Imagine how rich I would have to be to provide that level of luxury for myself, by owning things, rather than by living in a city that owns them for me.

Ordinary Europeans may be poorer than we are as individuals, but they are collectively richer. They have smaller cars and pay more for gas, but they also have better, cheaper, safer public transportation. They don't have huge suburban houses, but they don't need them, because their cities are safe and provide good public schools. They enjoy public art that they could never afford to buy or display in their homes. They're less likely to have elaborate playscapes in their yards, but the public parks are clean and safe and beautiful.

You can measure the cost of such things in terms of taxes, but how do you measure their value?

Risk and competition. Europeans have less need to pile up money than we do, because they are exposed to less risk. If they get sick, they'll get health care. Their kids' education is paid for, even college. When they retire, they get a pension. If their aging parents have to go to a nursing home, the state takes care of it.

So a German with nothing in the bank is in much better shape than an American with nothing in the bank. In spite of that, the Germans save more than we do and take on less debt.

Plus, there's a more subtle effect. European society is set up for most people to succeed, so there is less competitive pressure to make sure you (or your child) gets to the top. That is another reason Americans need money.

For example, state universities in the U.S. may not be free, but some are considerably cheaper than private schools. Annual in-state tuition at the University of Arkansas, for example, is only $6768 -- one of the cheapest I could find and far less than the $36,640 at Princeton. But in an economy where only a few people really succeed and the unsuccessful face so many risks on their own, is U of A good enough? Don't you have to send your kid to Princeton if you can?

Producer spending vs. consumer spending. One very insightful concept in Geoghegan's book is the difference between producer and consumer spending. An awful lot of the extra money we get for working extra hours is spent on things we need only because we work so much. It looks like consumption in the stats, but it really is a cost of production.

In the stats, a Parisian couple enjoying a leisurely night out at the bistro looks just like an American mom picking up some KFC on the way home because she had to work late and there's no time to cook. 

As we work longer hours, we really do need to eat out, bring in housecleaners, and in general contract out our lives. As I say, these are not so much "consumer" but "producer" wants. We need computers so that we can work at home, i.e., on weekends, late at night, etc. … We are not so much "consuming" as we are "investing" in ourselves as human capital.

How do they do it? If you listen to American conservatives, European socialism is all about "redistribution" -- taking money from productive people and giving it to unproductive people. And there is a kernel of truth there: European governments do make more transfer payments -- unemployment compensation, welfare, etc. -- than our government does.

But that's not the heart of the difference. In Europe, the working classes have more power to shape the system, so equality is built into the way things work, not just pasted on after-the-fact by transfer payments. The poster child here is Germany. By law, German corporations practice co-determination (mitbestimmung). Half the people on a corporate board are elected by the workers. Shareholders have a tie-breaking vote, but on any issue where the workers' representatives are united and the shareholders aren't, the workers' interest prevails.

That explains why the Germans haven't shipped all their manufacturing jobs to China.

Germans also practice regional industry-wide collective bargaining: All competing companies are committed to pay the same wages for similar job classifications, so none can get an advantage by squeezing its workers harder.

This is an important point to understand about cost-cutting in American corporations. Often it has nothing to do with efficiency or innovation. A company can cut costs just by paying people less, or by insisting that they do more for the same money. That kind of cost-cutting just re-slices the pie without doing anything to make it larger.

When one American company manages to squeeze its workers harder, its competitors are driven to follow suit in a race to the bottom. For example, when WalMart supermarkets came to California, the other groceries chains demanded cutbacks. Business Week reported: 

The industry's goal is to bring its health-care costs more in line with those of nonunion Wal-Mart Stores (WMT). The retail giant's medical plan covers fewer than half its workers, and its sales clerks earn less, on average, than the federal poverty level.

When the dust settled, the real economy hadn't changed -- the same workers did the same jobs, for the most part -- but they just made less money. That couldn't have happened in Germany, because WalMart would have been covered by the same collective bargaining agreement as the other groceries.

The work rules in German businesses are interpreted by works councils, who are also elected by the workers. Geoghegan explains: 

That means you help manage the place. On layoffs and other issues, the employer has to reach an agreement with the works council. So you help decide when to open and close the store. You help decide what shift someone gets. You help decide if someone gets fired. (No, I'm not kidding.) … That's the point of social democracy: it's not just that working people get an extra chicken in the pot; more important, they get the right to stir the pot.

At any moment, about half a million German workers are serving on works councils. Millions more have served at one time or another. That experience, Geoghegan claims, makes them politically aware and motivates them to stay informed. Geoghegan believes that's the reason German newspapers are fat and widely read: 

78 percent of Germans read a newspaper every day for an average of twenty-eight minutes.

Competitiveness. Hearing all that, an American pictures bloated organizations that can't compete globally and will soon be run out of business -- if not by us, by the Chinese. But that's not happening. According to the CIA, Germany exports more than the United States and only slightly less than China. Per capita, Germany exports almost four times as much as we do.

German industry survived, Geoghegan claims, precisely because its corporate structure forced it to compete on quality rather than wages. 

in the U.S. and the U.K., we got out of manufacturing because the labor costs were too low. We took the path of least resistance, competing on the basis of labor costs. Then, when that didn't work, it was so much easier to shut down.

So low-wage South Carolina stole the textile industry from high-wage Massachusetts -- for a few years, until the jobs moved on to Mexico or India or China.

Why don't we all know this already? I didn't, and I like to think I'm pretty well informed. I had no idea just how socialist Germany is. Most Americans have no idea how well health care works in France, that Denmark is energy independent, or that Sweden handled their banking collapse much more smoothly than we did.

The coverage we get of Europe, and especially of European socialism, is almost entirely negative. The Greek crisis is attributed to socialism, but not the German recovery.

Think about how often you hear that American workers need to tighten their belts, because we have to compete with the Chinese. To be more competitive, we need even deeper cuts in rich people's taxes and government benefits for the rest of us. We have to accept even more individual risk, work even longer hours, and be less particular about the environment and food safety and whether we're killing our miners.

Europe proves that it ain't necessarily so. But in a country where Disney, News Corporation, Time-Warner, General Electric and Comcast control just about everything you see or hear, why should anybody tell you?

Well, why should anybody (other than the Daily Show) tell you? Last April, Wyatt Cynac went to Sweden to expose the socialist nightmare. Part I. Part II.

Short Notes

Assuming that the Iraq War is over now, Thomas Friedman tells Charlie Rose that it was "unquestionably worth doing". What does Friedman think we got for our trillions of dollars and thousands of lives? We got to send a message to Middle Eastern Muslims: "Suck on this."

I'm increasingly amazed that Friedman is treated as if he were an insightful thinker, or even a sane one.

Racy movies used to advertise that they'd been "banned in Boston". Well, this Katy Perry video is too hot for Sesame Street, for what that's worth. At least she didn't wear this.

After their 2006 and 2008 disasters, the Republicans went into a period of soul-searching, promising to come back with new ideas. Now the fruit of their labors: their Pledge to America.

Jon Stewart brilliantly cuts between the new pledge and old footage of Republicans saying the exact same words in previous years. He sums up with the image of an abusive ex-boyfriend who wants a second chance:

"Baby, I know you left me. But if we get back together I pledge to you, I promise you I will still try to f**k your sister every chance I get. It's who I am, baby."

The media does this all the time with polls: Obama's agenda is assumed to be liberal, and then if a poll says people disagree with it, pundits assume that the people want something more conservative.

Well, maybe not. According to a new poll by Associated Press, the number of people who wish the health reform bill did more is double the number who wish it did less.

I always suspected that those groups behind conservative attack ads were funded by a few rich people, but I didn't realize how extreme things had gotten.

Friday, Rachel Maddow explained how Karl Rove's American Crossroads group, which is planning to spend $52 million to elect Republicans this year, got 91% of its August contributions from three billionaires. We're not just talking about a small fraction of the public. We're talking about three people.

You want to see how a Democrat can hit a Republican hard? Check out these ads by Alan Grayson and Barbara Boxer.

Digby shoots down Ben Stein's whining about his taxes.

The Weekly Sift appears every Monday afternoon. If you would like to receive it by email, write to WeeklySift at Help me figure out what to do with the Sift's Facebook page.

Monday, September 20, 2010

Made For You and Me

There was a big high wall there that tried to stop me.
Sign was painted, it said "Private Property."
But on the other side, it didn't say nothing.
That side was made for you and me.

-- Woody Guthrie, "This Land is Your Land" (1940)

In this week's Sift:

The Sift Bookshelf: Winner-Take-All Politics

Very suddenly over the last month, the liberal side of the blogosphere has started buzzing about the concentration of wealth and income, and how the United States has become much more stratified over the last few decades.

Of course this is nothing new: You've been seeing articles about the disappearing middle class for many years. (The Barlett and Steele best-seller America: What Went Wrong? was on the story in 1992, and the libertarian magazine Reason felt it necessary to deny the trend in 2007.) Lots of us have been talking about this for a long time, but recently we've all been talking about it at the same time. Why?

I think it's due to two new popularizations: the book Winner-Take-All Politics: How Washington Made the Rich Richer -- and Turned Its Back on the Middle Classby Jacob Hacker and Paul Pierson which came out September 14, and Timothy Noah's 10-part series The Great Divergence on Slate, published September 3-14. Both draw from research published over the last five years by two French economists: Emmanuel Saez and Thomas Piketty.

Winner-Take-All-Politics is a marvelous connect-the-dots book. It makes not just one point, but a series of points that fit together like train-cars.

Inequality is really happening, but not how you think. This is the part that relies on Saez and Piketty, who looked at U.S. tax data to paint a finer-grained portrait of inequality than we used to get from census data. The old statistics typically cut the country up into five 20% chunks (quintiles) or ten 10% chunks (deciles). If you do that, you can see the top quintile or decile pulling away from the rest, but it doesn't look too bad.

Saez and Piketty showed that something much more strange and scary is going on: The real action isn't in the center of the economy, it's on the extreme where the very rich live. What the rest of us are experiencing is just the trailing edge of a wave that starts there.

Within the top decile, the top 1% is pulling away even faster from the other 9%. Within the top 1%, the top .1% is pulling away faster yet, and so on. If the United States were 1000 people, the richest guy would have made 2% of the money in 1973. By 2008 his share was up to 8%. (Factoring in capital gains, it goes from 2.7% to 12.3%. In a village of 1000 people, one guy makes nearly 1/8 of the money.)

And that screws up a lot of the benign explanations. Yes, globalization and immigration force our unskilled workers to compete with the unskilled workers of the world. Yes, automation is replacing factory workers with machines. Yes, women and minorities are competing in labor markets that used to belong to white men. Yes, the educated fare better in the modern world than the uneducated. But that can't explain why the effect is most pronounced at the wealthy extreme, why we increasingly have a winner-take-all economy. None of those factors apply to the moderately rich, or explain why they can't keep up with the super-rich.

It's the government, stupid. We usually picture the economy as a natural phenomenon, and see government coming in after-the-fact to "redistribute" income. The recent decades' changes in government "redistribution" -- mainly tax and benefit cuts -- clearly benefit the rich, but aren't enough to account for the changes, so we think government is off the hook and look for larger forces like globalization.

In fact, government shapes the "free" market at every level: what can be owned or sold (your patented idea is a marketable asset, your liver isn't), who has a seat at the negotiating table (unions are represented on corporate boards in Germany, and boards have much more control over CEOs), who absorbs risk (that's what the bailouts represent: private interests transferring their risks to the public), what costs are externalized (pollution), and so on.

In the United States (and not nearly so much in Europe) government policy since about 1978 has consistently shaped the economy towards a winner-take-all structure. As a result, the U.S. used to be more egalitarian than Europe, and now is much less so. And that's not because Europe exists in a different global economy.

What about democracy? Hacker and Pierson take seriously the paradox of an elected government systematically favoring the few over the many, even when Democrats have been in power. How is that possible?

The short answer is that when a complex bureaucracy governs a complex economy, organization matters more than numbers. The rich and their corporations have gotten much more organized in the last generation, while organizations that focused workers' power (i.e., unions) have declined. Both of these patterns are embedded in vicious cycles: the government can make it harder or easier for various interest groups to organize.

The organized few beating the disorganized many explains how polls can say that 60% favor a public option in health care, but the public option doesn't even come up for a vote in the Senate. A clear majority favors letting the Bush tax cuts expire for the wealthy, and it makes no sense to extend them, but even some Democrats are ready to.

Even when good laws get passed, enforcement depends on a million little things happening correctly, and the organized power of wealth is there to see that they don't happen. Loopholes get written into regulation. Regulators get appointed who don't want to enforce the law. Penalties get set at levels so low that violators just consider them a normal cost of doing business, and so on.

Organization also shapes the outcome by misdirection: Exxon never gets confused about where its interests lie in the global warming debate, but ordinary people do.

Hacker/Pierson trace this trend to the Carter administration, when huge post-Watergate Democratic majorities were unable to make any progress on a liberal agenda. The initial conditions that get the vicious cycle started are: a decline in union membership, television increases the role of money in campaigns, and the wealthy started pooling their money to create a wide-ranging infrastructure. (In the old days, GM would lobby against car safety regulations and Standard Oil would try to hang onto special tax treatment for oil wells, but neither would do much to influence a Supreme Court nomination. Now, corporate and billionaire money supports a broad conservative movement through institutions like the Heritage Foundation or the Club for Growth.)

America in a parallel universe. I don't really have the space to do the Hacker/Pierson case justice, so instead I'll illustrate in my own way how relatively subtle changes in the economic/political cycle can have huge impacts over time. Let's look at how early America could have developed differently.

America was founded not just on freedom and democracy, but also on high wages. In colonial times, the nearby western frontier worked like a minimum-wage law. If you paid people too badly, they'd go clear their own land instead of working for you.

As the frontier moved further west, the causality started working in the other direction, creating a virtuous cycle: High wages in the East allowed workers to raise the capital they needed to go west and homestead -- enough for a horse, a wagon, some tools, and the wherewithal to keep a family going until a crop came in. In Democracy in America (1835) de Touqueville described it like this:

The European emigrant always lands, therefore, in a country which is but half full, and where hands are in request; he becomes a workman in easy circumstances, his son goes to seek his fortune in unpeopled regions, and he becomes  a rich landowner. The former amasses the capital which the latter invests.

So the West was like college. You came to America and saved so that you could send your children there.

Whatever actually happened always looks inevitable. But it didn't have to work that way. If the rich in the East could have beaten down wages for just a decade or two, they could have stopped this egalitarian cycle. Then the poor would be trapped working for them for subsistence wages, and never raise the capital to go west.

Picture how it plays out from there: As the western expansion fizzles, the wealthy make the case to Congress that the policy of selling public land cheaply in small parcels (going back to the Land Ordinance of 1785) has failed. The way to settle the continent, they claim, is in vast Spanish-style haciendas.

But America's frontier isn't the open country of Mexico. So how can the rich clear the forests of Ohio and turn them into tillable land? The same way they drained the swamps of Georgia and South Carolina and established plantations there: with slaves. The case might sound a lot like the one made by Charles Cotesworth Pinckney in 1787: "the nature of our climate, and the flat, swampy situation of our country, obliges us to cultivate our lands with negroes ... without them South Carolina would soon be a desert waste." ["desert" meant "deserted" in those days, not dry.]

So the first new states get settled like this: A plantation-owning family from Virginia purchases a 10,000-acre plot from the government and sends out a younger son with a slave workforce to clear it. Any law that might stop him is standing in the way of the nation's progress, and needs to be repealed.

And this, of course, keeps the low-wage cycle going. If you want a job on the frontier, you'll have to do it cheaper than a slave. Even in Ohio, a worker can't raise the capital to move on and settle Illinois or Wisconsin. So the rich will have to manage that expansion too.

When coal is discovered in Pennsylvania and West Virginia, that also becomes a job that white (i.e. free) men won't do -- at least they won't do it for wages that compete with slaves. That becomes common sense, just like our idea today that only Mexicans will pick lettuce.

And America becomes a very different place.

You see, an egalitarian society is a fragile thing. If power and wealth ever get too concentrated -- even accidentally, even just for a little while -- then the powerful can capture enough of the government, media, and intelligensia to make their vision of the future seem like common sense. Even if you theoretically have the votes to defeat them, you can't, because any alternative vision seems too utopian to fight for.

If you want to see how the far Right responds to these ideas, look here. The vanishing middle class is Socialism's fault. The fact that it's not happening nearly as badly in countries that are more socialist than we are just doesn't come up.

Anti-Crazy is not a Winning Political Platform

Now the primaries are complete: Christine O'Donnell of Delaware has joined Marco Rubio in Florida, Rand Paul in Kentucky, Sharron Angle in Nevada, Ken Buck in Colorado, Mike Lee in Utah, and Joe Miller in Alaska in a bloc of seven Republican/Tea Party Senate candidates.

Of that group, O'Donnell is both the newest and the most unlikely: Not only does she have no government experience, she barely has a resume at all. She founded the Savior's Alliance for Lifting the Truth (SALT, as in "salt of the Earth"), a group that encouraged young people to live lives of Christian purity, particularly in regard to sex. (By now probably everyone has seen her denunciation of masturbation on MTV.) And she worked for the Intercollegiate Studies Institute (a conservative non-profit focused on college students) until that job ended in a gender discrimination lawsuit in 2005. Since then she has been running for the Senate and supporting herself by doing "odd jobs" -- or maybe by illegally spending campaign funds for living expenses.

Democrats have treated O'Donnell's victory over popular Congressman Mike Castle like an early Christmas present. Castle was a shoo-in to move Joe Biden's old seat into the Republican column, but O'Donnell trails Democrat Chris Coons by double digits. Castle is refusing to endorse O'Donnell -- maybe her campaign's suggestion that he's gay ticked him off -- so the prospects for Republican unity are dim.

Still, I'm worried that the campaign against O'Donnell is off to a bad start. Despite their pro-rich, anti-working-class agenda, conservatives appeal to the working class by casting liberals as over-educated elitists who look down on people like you. So carelessly heaping scorn on O'Donnell just makes her the someone-like-you that liberals look down on.

In particular, problems in a candidate's past only work if they are substantiated in the present. Here's what I said about Obama/McCain in June, 2008:

Experience works as an issue only until the public can see the candidates side-by-side. At that point, the experience difference has to be visible in their performance -- McCain needs to look like he knows what he's talking about while Obama doesn't. If the experience advantage is invisible -- and I think it will be -- the issue goes away.

Well, crazy works the same way. If O'Donnell on the campaign trail looks no more threatening than a young Sally Field, it won't matter how many nutty things she's said in the past. But if Democrats can make an issue of the nutty things she's advocating now, then her past becomes significant again.

With that in mind, I think Rachel Maddow was on the right track Thursday when she called attention to the truly radical anti-abortion positions of the Tea Party candidates:

There are now at least five Republican Senate nominees -- five -- who not only think that the government should outlaw abortion nationwide, they think there should be no exceptions made for anybody who's the victim of incest or is the victim of rape. … What these Republican candidates are talking about is not only the federal government monitoring every pregnancy in the country to make sure that it ends the way the government prefers, which is a live birth, but they're also saying that the government should force rape victims -- the government should force rape victims, under pain of criminal prosecution -- to give birth to their rapist's baby.

In the world Sharon Angle, Cristine O'Donnell, Joe Miller, Ken Buck, and Rand Paul want to create, rape is a viable evolutionary strategy for men. We can put a rapist's body in jail, but his genes will live on.

Similarly off-the-wall Republican positions are that to return all unspent stimulus money. In other words: All those half-done road repairs should be left the way they are. Rand Paul's view that private business should be allowed to practice racial discrimination -- that's something he believes now, not some foolish idea from his benighted youth. And in the Senate, he'd have a vote on nominees for the Supreme Court.

And finally, the attack on health-care reform needs to be met head-on. Fifty million people now lack health insurance, and many of the rest of us are one lay-off away from joining them. The law that Democrats passed will cut that number in half, and give Americans security where Republicans offer them only risk. Repealing health-care reform with no plan for covering those 50 million is a truly wacky idea, and it needs to be called out as such.

If you follow the Rachel Maddow link, you'll see one thing that I think she gets wrong. She quotes Sharon Angle responding to the no-exception-for-rape abortion question :

I'm a Christian, and I believe that god has a plan and a purpose for each one of our lives, and that he can intercede in all kinds of situations. We need to have a little faith in many things.

Rachel comments: "I don't know what you're supposed to have faith in" and makes a couple of guesses that miss the point. But anybody who speaks Fundamentalist knows immediately what Angle meant: You wouldn't have gotten pregnant if God didn't have a plan for your rapist's baby.

Let's be sure to call her crazy for the right reasons, and not because we don't understand what she's saying.

Restore Sanity With Jon Stewart

Jon Stewart is rallying in Washington to restore sanity. It's on: Saturday, October 30 on the National Mall in Washington, D.C, sane people will get together to "take it down a notch for America".

Not to be outdone, Stephen Colbert is having a counter-rally to Keep Fear Alive.

This is not a joke. Or rather, it is a joke, but it's also really happening. Here's hoping the Jon/Stephen combo can significantly outdraw Glenn Beck. Think about going. It will be fun.

Short Notes

Image of the Week: Fractal Wrongness.

Check out the Echo Park Time Travel Mart in Los Angeles. ("Whenever you are, we're already then.") If the slushy machine isn't working come back yesterday. But don't even think about buying fire if you're pre-Neolithic. ("No upright posture, no mastery of tools -- no fire.")

Paul Krugman's take on the folks who want the rich to keep their Bush tax cuts:

when the tax fight is over, one way or another, you can be sure that the people currently defending the incomes of the elite will go back to demanding cuts in Social Security and aid to the unemployed. America must make hard choices, they’ll say; we all have to be willing to make sacrifices. But when they say “we,” they mean “you.” Sacrifice is for the little people.

Jay Rosen's lecture to French journalism students is well worth reading. Your authority as a journalist, he tells them, "begins when you do the work" of going someplace, talking to somebody, or reading something that your readers haven't gone/talked to/read. "If an amateur or a blogger does the work, the same authority is earned."

The Weekly Sift appears every Monday afternoon. If you would like to receive it by email, write to WeeklySift at

Another way to keep up with the Sift is on Facebook. (I'm still figuring out what to do with the page.)

Monday, September 13, 2010


It is easy to find a man in almost any line of employment who is twice as efficient as another employee, but it is very rare to find one who is ten times as efficient. It is common, however, to see one man possessing not ten times but a thousand times the wealth of his neighbor.

-- Willford I. King The Wealth and Income of the People of the United States (1915)

In this week's Sift:

  • Propaganda Lessons From the Religious Right. It's no longer enough just to correct the specific misinformation that comes from the Right. We need to figure out how their propaganda works.
  • Distribution of Wealth. Concentrated wealth at the top isn't just bad for the people at the bottom. It's bad for the economy in general.
  • Short Notes. Why Koran-burning is news now. What teaching in Florida is really like. Haley Barbour's fictional history of southern Republicans. What the WaPo can learn from Digby. And the Dutch example for dealing with teen sex.

The Weekly Sift is now on Facebook. I haven't done much with the page yet, but keep watching. If you have advice, write on the wall.

Propaganda Lessons From the Religious Right

The most frustrating thing about this election campaign is how much of it is based on nonsense and fantasy. If we were just losing a reasonable debate about, say, the role of government, I think we'd all know what to do: go back to the drawing board and come up with better policies and better ways of explaining them.

But what if we lose because sizable numbers of people believe that President Obama is a Muslim who hates white people? Or that the new health-care law institutes death panels? Or that the Democrats are part of some sinister plot to recruit children into homosexuality or impose sharia law?

What drawing board do we go back to then?

So often we seem to be in a battle with something we can't see. The other side makes a claim that is provably false -- like that Obama has raised taxes or quadrupled the deficit -- and rather than ask for examples or evidence, large numbers of people just nod their heads. We can't get important issues like global warming or the increasing concentration of wealth on the national agenda, while the other side can conjure issues like the ground zero mosque or Obama's czars out of thin air.

How does that work?

In a word, the problem is propaganda: The Right has the Left way outclassed in terms of propaganda. And because most of us have no idea how propaganda works, we feel like we're battling with ghosts.

For a long time the Sift has been pruning the branches of propaganda: I do a Disinformation Watch article every now and then, and most weeks some outrageous lie gets debunked in the Short Notes. But that's like digging up individual dandelions. The other side can produce a hundred new lies in the time it takes to debunk one.

This week I want to look at the larger structure of propaganda: Why does it work? Why are so many people so ready to believe these things?

Beyond Lying. The fundamental misconception most liberals have about propaganda is that it's just lying: Say something false, repeat it often enough, and people will start to believe it. Superficially, "death panels" worked that way. Overnight the phrase was everywhere, repeated by so many people that it seemed like there must be something to it, even it had been exaggerated.

But if propaganda was just lying, then truth-telling would undo it. All we'd have to do would be to get more people telling our truth than their lie, and we'd win.

How often have you seen that work?

Beyond Framing. A frame is a metaphoric template that organizes the individual facts about an issue. What makes them so effective is that most of the action is unconscious: You can invoke a frame by using some of its words and images, without ever justifying that it's the right way to think about the issue. When neo-cons talked about "appeasing" Saddam, that one word invoked the whole Hitler/Munich frame, in which the enemy is implacable and war is inevitable. And because those ideas stayed in the background, they didn't have to support them with evidence.

The problem is that counter-framing also doesn't work very often -- for reasons that liberal framing godfather George Lakoff understands but has trouble communicating. It's in his books, but it seldom comes across.

What most liberals miss about framing is that effective framing doesn't happen in mid-debate. Effective framing is laid down in layers, over decades or even centuries. (Ironically, this is why the word framing frames its subject badly. Framing suggests a one-time event where you decide what's in the picture and what's out.)

The only way I can think to explain this is through the example of a small-but-specific issue: The current religious-right argument that anti-bullying campaigns in the schools are part of some sinister gay agenda that takes away the rights of Christian parents. And I want to describe some of the layers of frames that make their argument so undeservedly convincing and so hard to argue against.

It Starts With the Devil. Like a lot of traditional faiths, the Christian Right's theology includes a Devil. This isn't the place to argue about the existence of a Prince of Darkness, but I want to point out what you can do once you have a Devil in your theology.

The Devil is the ultimate sinister conspirator, motivated by pure evil. Once you have a Devil, it follows without evidence that there is a conspiracy against anything true and good and right. How could there not be? The Devil is against it, and unless he has suddenly lost his innate cleverness and his characteristic ability to lie and tempt and cajole, he will have followers.

So if you are arguing in front of a Devil-postulating audience, you don't have prove that there is a conspiracy against the Good -- of course there is -- you only have to identify that conspiracy. The Manichean frame (God/Devil, Good/Evil) is sitting there, waiting for you to connect yourself with Light and your opponent with Darkness.

Once you've done that, the hardest part of establishing a conspiracy theory -- giving it a motive -- is accomplished. So when President Bush said of terrorists

They are a movement defined by their hatreds. They hate progress, and freedom, and choice, and culture, and music, and laughter, and women, and Christians, and Jews, and all Muslims who reject their distorted doctrines.

large numbers of people just nodded their heads in recognition. They didn't ask for evidence that such people exist or wonder why anyone would sign up with them. The Devil has minions. How could he not?

Layer II: Reverse discrimination. The second layer isn't quite so universal as the Devil, but it has been used for decades in so many circumstances that it also can be invoked largely without evidence: Maybe the weak were persecuted generations ago, but in our era the tables have been turned, and it is actually the strong that are persecuted.

Now, it is claimed, the law favors blacks over whites, non-Christians over Christiansthe poor over the rich, gays over straights, foreigners over English-speakers, illegal immigrants over citizens, and on and on and on.

In general, minority rights are controversial in a democracy, and special action is required to make things equal. But no matter how bad things are for the minority in reality, the special action can always be cast as some kind of privilege. (The Little Rock Nine were escorted by the 101st Airborne Division. But I had to fend for myself when I went to high school.)

Almost invariably, the examples of reverse discrimination fall apart when looked at closely. (The Christian church near Ground Zero that hasn't been rebuilt yet was part of a deal involving millions in public money. It's not an example of Christians being treated worse than Muslims.) Majorities are powerful in America, and they can get their cases favorably resolved.

This layer serves two purposes. First, it corrupts the language of equality, devaluing it in the same way that counterfeit money devalues real money. "You're discriminated against? No, look at me, I'm discriminated against."

But in the longer term, the second purpose is even more significant: By constant repetition, the notion that the majority is persecuted becomes axiomatic -- at least in the eyes of the majority. If a minority is claiming rights and wanting government intervention, it must be trying to claim an advantage. There's no need to specify that advantage too exactly, or to substantiate examples of majority persecution.

You can see Layers I and II working together in the claim that same-sex-marriage advocates want to destroy traditional marriage. ("this is the ultimate goal of activists," writes James Dobson, "and they will not stop until they achieve it.") It's an unmotivated conspiracy of the minority to oppress the majority. What would same-sex couples gain by destroying traditional marriage? How are opposite-sex couples harmed when same-sex couples marry? Among the faithful these questions are answered by the unconscious assumptions in the frame; more specific answers are unnecessary.

Tactics. There are other layers that have taken decades to lay down -- the poor are lazy, traditional sexual morality is related to non-sexual moral issues like honesty and integrity -- but lets just stick with those two and see how they influence tactics. The main thing to remember is: When you work within a long-established frame, you don't have to prove anything, you just have to fill in the blanks.

Think about Glenn Beck's chalkboard talks. If you make yourself watch one, I predict you'll come out saying, "What was that all about?" They're all names and labels: So-and-so is a Marxist and is connected to this other guy who has some kind of relationship with Obama. It doesn't sound like an assemblage of evidence, because it isn't. He's just helping his audience identify an enemy that abstract principles tell them must exist.

And only now do the lies come in: to vilify somebody like Van Jones. And pointing out that the lies are lies gains very little: The point is the pattern of accusations, and if this one or that one isn't true, well, what of it?

The lies exist inside a web of mischaracterization. No enemies are quoted in complete sentences or allowed to speak in their own words at length and in context. Everything is summarized and labelled.

Applied Tactics. The easiest way to see how tactics work is to look at some small issue you haven't thought much about before. For me this week, that was the Religious Right's attempt to smear a campaign against bullying in schools. (It's part of the "gay agenda" to "sneak homosexuality lessons into classrooms".)

It's a comparatively young smear, so you can read a nearly complete collection of documents in a short time. Start with an article called Parents beware of deceptive "anti-bullying" initiatives. (You can pull the glossier print version off the main menu.)

If you come to the article wondering what is happening that you as a parent should worry about, you will be confused. LIke the Beck chalktalk, most of it goes right past the uninitiated, leaving a "What was that about?" feeling.

Instead you'll learn that local anti-bullying organizations have "ties" to gay-friendly organizations. (Given how often bullying involves insults like "queer" or "faggot", it would be strange if they didn't.) They're also "tied" to "President Obama's controversial 'Safe Schools czar' Kevin Jennings". (Czars are bad, even when they're doing exactly what their job titles indicate.)

You'll also learn about things that might happen or even could be happening right now: gay activists "infiltrating classrooms" which would be "transformed into indoctrination centers" with "mandatory homosexuality lessons". But you're well into the second page before you run into anything that actually did happen:

the Illinois Safe Schools Alliance [was] heavily involved in crafting state legislation that makes “sexual orientation” and “gender-related identity” protected categories in schools.

No clue what that would actually mean in terms of stuff happening in the schools, but it plugs into the "special rights" frame. The minority is oppressing the majority again! When good Christian kids scream "queer!" in some other kid's face, they will be in trouble instead of the homo.

A variety of books and videos are identified as things to watch out for. They are pejoratively summarized in a few words, never linked to, and never quoted in complete sentences. The only way you can check these summaries is if they mention a title you can google and look up on your own.

(I managed to look up and read Just The Facts About Sexual Orientation and Youth, a pamphlet intended for teachers and school administrators. The religious-right counter-pamphlet Just the Real Facts Please, is then easily seen to be a collection of non-sequiturs that use out-of-context quotes as excuses to go off on tangents. But how many people are going to go to that much trouble? Most will just know that there is a good pamphlet refuting the bad pamphlet.)

What to do? Imagine being a liberal parent and having a religious-right parent give you Parents Beware as part of a we-have-to-do-something talk. What can you say? You can't argue with a case that hasn't been made, with "ties" and sinister fantasies that don't involve any checkable facts. It is impossible to prove that some organization you just heard of isn't in league with the Devil.

This problem shows up again and again. Take the so-called Ground Zero Mosque: What exactly its opponents are afraid of and what exactly they want to do about it has remained fluid. Arguing about it has been like wrestling with a jello monster.

Tactically, when you have these kinds of discussions one-on-one, I recommend a judo strategy: Draw the other side out before you object. You can't argue with unconscious assumptions, so make them state a problem and propose a solution. If they can't, ridicule them for that -- don't take the bait and go down some tangent.

Long-term, we need to recognize that we can't re-frame issues in mid-debate just by making up new slogans and new metaphors from scratch. The other side is using multiple layers of frames, the deepest of which have been laid down centuries ago. We need to get in touch with our own deep layers (which go back to the Enlightenment, the Sermon on the Mount, and timeless notions of fairness) and work to nurture and promote those ideas in everything we do. When we do that, we can speak with a power and authenticity that is very different from "spin".

Wednesday in DailyKos I addressed a different level of propaganda: How right-wing money creates bogus think tanks whose bogus experts get quoted even in supposedly liberal venues like the New York Times.

Distribution of Wealth

Just about the only time I hear the phrase distribution of wealth these days is when somebody like Glenn Beck talks about redistribution of wealth -- that's when the evil Marxists come, take away the money you earned by your hard work and brilliance, and give it to the lazy stupid people.

This week, though, Slate's Timothy Noah started a series called The Great Divergence, about why the portion of our national income that goes to the rich has grown so much over the last 30 years. (Inequality peaked just before the Great Crash in 1929, fell from the 30s through the 70s, and recently has returned to 1929 levels.)

I had planned to cover that series in this week's Sift, but it isn't finished yet. So next week I'll discuss Noah's points (and possibly the new book Winner-Take-All Politics which takes on related issues).

This week I just want to make one point: It's no coincidence that high concentrations of wealth and bad economies go together. When you shift money from the poor and middle class to the rich, demand drops. That can turn into a deflationary cycle if business adjusts to lower demand by cutting jobs, which then lowers demand further.

What was the real difference between the Happy-Days economy of the 50s and the Grapes-of-Wrath economy of the 30s? We had the same natural resources, similar technology, similar culture. But in between, the war gave our government a reason to tax the rich and spend an enormous amount of money. That shifted the distribution of wealth, moving the economy to a high-demand, high-production mode rather than a low-demand, low-production mode.

Since the Reagan administration, we've been doing the reverse.

Short Notes

The best coverage of the Koran-burning minister came from Rachel Maddow:

For the most part, [this story] has been talked about in terms of religious freedom and First Amendment rights.  That‘s the way that the national, responsible mainstream media dealt with this story. But that‘s actually the wrong frame for this story. He is a kook doing as kooks do.

Religious nutjobs have burned Korans in public before and no one cared. But they're newsworthy now because supposedly serious political figures like Newt Gingrich are mining the same vein of war-with-Islam craziness.

A major piece of the conservative government-is-evil rhetoric is to demonize everybody who gets a paycheck from the taxpayers: They're all lazy parasites (unless they die, like the 9-11 firefighters).

From the Facebook wall of my sister the teacher, an essay by a Florida teacher explaining how things really are:.

I am required to teach Social Studies and Writing without any curriculum/materials provided, so I purchase them myself. I am required to conduct Science lab without Science materials, so I buy those, too. The budgeting process has determined that copies of classroom materials are too costly, so I resort to paying for my copies at Staples, refusing to compromise my students’ education because high-ranking officials are making inappropriate cuts. It is February, and my entire class is out of glue sticks. Since I have already spent the $74 allotted to me for warehouse supplies, if I don’t buy more, we will not have glue for the remainder of the year.

No doubt she's living like a princess on her $28K a year.

Here's what I wonder: Each kind of government worker -- teachers, police, fire, and so on -- knows that the conservative rhetoric about them is false. Do they realize that it's false about the other government workers too? Or do they believe that the folks at the DMV are living it up?

Haley Barbour is rewriting the history of civil rights in the South to put himself and the Republican Party on the right side. The truth: When the Democrats embraced civil rights, white racists switched parties and became Republicans. And they were welcomed with open arms.

Digby points out one way in which bloggers are more thorough than Washington Post reporters: Before we quote a congressman, we'll google him to make sure he's real.

You know whose statistics on teen pregnancy and STDs we should envy? The permissive Dutch.

The Weekly Sift appears every Monday afternoon. If you would like to receive it by email, write to WeeklySift at


Monday, September 6, 2010

Hard Work

When a man tells you that he got rich through hard work, ask him: "Whose?"

-- Don Marquis

In this week's Sift:

  • Jobs. It's easier to understand which policies won't create jobs than which ones will.
  • Corporatism and Net Neutrality. The debate sounds technical, but it's really about creating choke-points and collecting tolls.
  • Short Notes. Can liberals draw a crowd in D.C.? Why does the media provide a free platform for corporate shills? Strippers protest an Ohio church. Two-year-olds on anti-psychotics. God is funding Joe Miller's Senate campaign. David Brooks says something uncommonly insightful about Glenn Beck's followers. Bad Christmas presents. And more.


What better topic for Labor Day than jobs? Everyone seems to agree that there aren't enough jobs. But they disagree about whether and how the government can do anything about it.

Where are we? I love a good graphic, and this one explains where we are in the current recession compared to all the previous ones since World War II.


We're in an unusually long and deep drop. (The graphs show the percentage of jobs lost, which eliminates the effect of increased population.) In length it's looking about the same as the previous recession (2001), when it took about four years to get all the jobs back. In depth, it's the worst since the Depression.

We seem to be 6-8 months past the bottom, though the upward slope isn't very steep yet. Temporary hiring for the census created an illusion (that things were getting better faster a few months ago and that they're getting worse now) which is smoothed out in the dotted line.

Why? Popped bubbles lead to recessions that are fundamentally different from ordinary recessions, and recovery takes longer. Bubble-popping recessions include this one, the 2001 recession (the internet bubble), the Japanese "lost decade" of the 1990s (stock and real estate), and the Great Depression.

An ordinary recession is a normal part of the business cycle, caused by a temporary excess of production and inventory in an economy that is basically healthy. Businesses get over-optimistic during an expansion, so they build too many factories, open too many stores, and hire too many people. Eventually, some minor or accidental glitch causes consumers to slow down their spending. Then retailers cancel orders, factories lay off workers, and everything snowballs for a while, as each cutback causes more people to realize they're over-extended. Eventually, though, the overstocked inventory gets sold, factories get orders again, and everything straightens out.

That's what happens in the real economy. In the money economy, the ordinary recession produces a liquidity crisis -- people have assets of long-term value, but they need (or think they need) cash. So they try to sell things, driving prices down, and causing other people to want to sell things in a panic. Eventually wiser heads realize assets are cheap and start buying. Then the markets snap back like a rubber band.

An asset bubble, on the other hand, is based on fantasy and fraud rather than excess optimism. (The Dutch Tulip Mania of 1637 is the classic example.) In an asset bubble, large numbers of people imagine that they're rich -- and borrow and spend accordingly -- because speculators have bid asset prices up higher than any rationally foreseeable economic growth can justify. When the bubble pops, formerly "rich" people can't pay their bills, then the people they owe can't pay their bills, and so on.

In the financial economy, the asset bubble produces a solvency crisis. In a liquidity crisis, your creditors will get their money if they just wait until you can bring your long-term assets to bear. In a solvency crisis, you are actually broke; your debts exceed any rational valuation of your assets. The question in a liquidity crisis is "Who's willing to wait to get their money?" In a solvency crisis it's "Who's going to take the loss?"

The government can solve a liquidity crisis just by extending credit. (That's why the Federal Reserve was invented.) But extending credit during a solvency crisis just delays the day of reckoning. The books don't balance, and somebody has to take the loss.

Kinds of unemployment. One of the big debates now is about whether our unemployment is cyclical or structural. That sounds technical, but it's actually a pretty simple idea: Cyclical unemployment is the carpenter who will get back to work when the economy picks up and people start building houses again. Structural unemployment is the mechanic who sees gobs of want ads for nurses -- there are jobs, but not for him.

Cyclical unemployment is fairly easy to solve: The government runs a big deficit, lowers interest rates, and just generally pumps money into the economy. Imagine what would happen if somebody started shoveling five-dollar bills out of a helicopter: Pretty quickly the ice cream shop would have to hire back the scoopers it laid off.

Structural unemployment is trickier, because workers need to retrain. Government can help a little, but only after people get desperate enough to start over.

Paul Krugman has been arguing that our current unemployment is mainly cyclical, and that the problem with the stimulus is that it wasn't big enough. (He argued at the time it was proposed that it wasn't big enough.) Slate's James Ledbetter summarizes arguments that unemployment is increasingly structural. (The Economist is big on this idea and has been for months.)

The cyclical/structural distinction is related to the optimism/fantasy distinction: Bubbles distort the economy, and the jobs that go away when they pop don't necessarily come back. We had an irrational number of real estate agents, mortgage brokers, and home rehabbers in 2007, and a lot of them will have to find something else to do.

Still, it's obvious that unemployment isn't entirely structural, because there aren't any booming sectors screaming for qualified workers. My friends' kids are entering college now, and I don't know what they should study to be sure of getting a job.

What won't work: extending Bush's tax cuts. Few job-creating ideas are as delusional as extending the Bush tax cuts. Obama wants to let them expire for those making $250,000 or more (as he promised in the campaign). Republicans argue that restoring these Clinton-era rates will primarily raise taxes on small businesspeople, who are the primary creators of jobs. Keep their taxes low and they'll create the jobs the economy needs.

Not exactly. According to the WaPo's "5 Myths" column:

If the objective is to help small businesses, continuing the Bush tax cuts on high-income taxpayers isn't the way to go -- it would miss more than 98 percent of small-business owners and would primarily help people who don't make most of their money off those businesses.

Plus, the small-business-creates-jobs myth is only sort of true. A small business that is breaking out -- starting to franchise nationwide, say -- hires a lot of people. On the other hand, your basic family-owned restaurant or proprietor-operated shop might give the part-time help more hours if business picks up, but they rarely launch major expansions. And when they do expand, the trigger is increased consumer demand, not lower taxes.

A local friend verified this by talking to a number of proprietors on our Main Street. (Here in Nashua, Main Street is not a metaphor.) How many new people would they hire if they got a tax cut? Invariably, the answer was none.

What won't work: lower interest rates. Robert Reich takes apart the idea that lower interest rates will create jobs. In an ordinary recovery they will, but not in an asset-bubble recovery.

Usually, low interest rates create jobs in both a supply-side and a demand-side way. On the supply side, a business that wants to expand is more likely to do so if it can get a cheap loan. But, once again, if there's a shortage of demand, businesses aren't going to want to expand. Why build on to your restaurant if you can't fill the tables you have?

On the demand side, lower interest rates encourage people to borrow money to buy stuff. But:

Individuals aren't borrowing because they're still under a huge debt load. And as their homes drop in value and their jobs and wages continue to disappear, they're not in a position to borrow.

Reich sees two main results of lowering interest rates: First, a new wave of corporate acquisitions, which will have the effect of eliminating redundant jobs in the merged companies. And second, investment in new equipment that will replace workers rather than increase production. Net result: fewer jobs, not more.

What about Germany? Germany is often cited as an example of an economy that is recovering without a major government stimulus. Interesting story there: So far, Germany's recovery is better than ours in terms of employment, but worse in terms of GDP.

Two things are different about Germany: First, they didn't have a housing bubble, though their banks did get in trouble from investing in our worthless mortgage-backed securities.

Second, in the US, we let companies fire people and then paid them unemployment. Germany subsidized employment directly. NPR's Marketplace explains:

Workers are building fewer trucks because demand has dropped in half this year. But MAN says it hasn't had to lay off any of its permanent staff. That's because it's signed up for a government program called kurzarbeit, or short work. Workers take a cut in their hours and their pay. But the German government reimburses them for a chunk of their lost wages.
MAN spokesman Dominique Nadelhofer says employees may work as little as half time. But they still make 90 percent of their salary.

It's hard to say what lesson we should draw from that, other than maybe what we should do next time.

Conclusion: More stimulus would help some, but it's not clear how much, and besides, the political mood is very hostile. Democrats will do well to resist deflationary spending cuts. If the graph is right, employment should be back to 2007 levels in another year and a half.

In August, private employment went up by 67,000 jobs, but government employment dropped by 121,000 as temporary census jobs ended and the effects of the stimulus diminished. And this isn't encouraging: "while corporate profits were generally robust in the second quarter, many companies improved their revenues by cost-cutting."

Evidence of conservative framing success: The stimulus is often described (even in places like the NYT) as $800 billion of "federal spending". Actually it was about $500 billion of spending and $300 billion of tax cuts.

Slate explains where Labor Day comes from: After suppressing the Pullman strike, President Cleveland wanted to curry favor with workers. But the obvious May 1 holiday would have commemorated the Haymarket Riot.

Corporatism and Net Neutrality

DailyKos' Thutmose V posted a nice net-neutrality-for-dummies piece Monday.

Net neutrality is a good example of how corporatism works. Internet-providing corporations like Verizon and Comcast know why they care about the issue, and so they're relentless in lobbying for their interests. Most of the public doesn't know why they should care, and the eyes of the non-geek majority quickly glaze over when someone tries to explain.

As Thutmose makes clear, there is a legit reason why some internet traffic (like live video) would benefit if there were a high-priority lane on the internet, while other traffic (like email) wouldn't suffer if it were shunted to a low-priority lane and arrived a second or two later.

Regulations could be written to do this without fundamentally altering the nature of the internet. The Post Office, for example, has multiple classes of mail, but they don't deliver pro-Post-Office magazines faster than anti-Post-Office magazines.

But if the regulations are too loose, the internet corporations will gain vast new powers to prioritize however they like:

Imagine if Ford bought the Interstate Highway system, and announced that any car that was not a Ford would have to pay a high toll to use the highways. The Comcast NBC merger invites a similar situation with the Internet.  Does anyone think that Comcast might be tempted to give NBC priority on their network, and maybe charge anyone else providing [competing] content a high price to get on the net?

Comcast has disturbing history here.

Google was supposed to be a corporation whose interests coincided with consumers, but the Electronic Frontier Foundation isn't happy with the proposal Google worked out with Verizon. Google's interests are protected, but (according to MSNBC):

Skype would not have a chance to compete with any video telephony service Verizon might develop in the near future. And Netflix would be at a disadvantage trying to move high-quality video over Verizon’s fiber-optic pipes if Verizon decides to offer its own service.

Even if the corporations decide to play fair with each other, a fast-lane-slow-lane structure motivates them to keep the slow lane slow. The point here is to create many new choke-points where toll booths can be set up. That -- and not innovation and competition -- is how big corporations make big money.

For a trivial example of how corporate toll booths work, consider unlisted phone numbers. The LA Times' David Lazarus reports that the monthly cost of an unlisted number varies from $1.25 (ATT) to $1.99 (Time Warner Cable) per month -- in exchange for changing a bit in their database and then not publishing your number:

Time Warner and other telecom companies are charging for a service that consists of them basically not doing anything. And because they continue not to do anything month after month, they keep charging you on the grounds that it's a recurring service.

He points out that Time Warner Cable doesn't even publish a phone book -- it just distributes information to whoever has the local phone book contract. So the "service" is purely a toll TWC can charge because it happens to be the gate-keeper.

Kevin Drum elaborates:

phone companies are regulated monopolies. If I want phone service, I have no choice but to contract with a tiny number of suppliers who then have privileged information about me. Should I also pay them protection money for withholding my Social Security number or my date of birth from their phone books?

The job every corporation really wants is Gate Keeper. You do nothing, employ nobody, and collect tolls. Wait, I'm wrong, you do employ some people: lobbyists who help you create new choke-points where new gates can be installed.

Short Notes

I can't make it to D.C. on October 2. Can you?

We used to mourn when the independent bookstores were driven out of business by Barnes and Noble. Now we mourn when the Barnes and Noble closes.

The NYT had a "Room for Debate" feature on the great egg recall and what's wrong with the egg industry. Rather than discuss the issue, though, I want to step back and look at the contributors: a food safety activist, some university professors in relevant fields, and then a guy from the Cato Institute, a libertarian think-tank funded by the Koch brothers.

The Cato guy, predictably, says that "The Panic Will Subside" and so there's no need for new regulations. That's because Cato's mandate is not public health, but fighting government regulation of business. Every Cato article concludes that regulations are unnecessary, and the only mystery is how it will arrive at that conclusion. (This guy says that regulations will necessarily favor big egg producers over small ones. But of course Cato cares no more about small egg producers than it cares about public health. Whoever makes no-government-regulations a sympathetic position is Cato's new best friend.)

Here's my question: Why do we routinely let these guys into the room, even though they have no interest in solving the problem, whatever it is? Every well-rounded debate panel has to include a shill for our corporate overlords, who will argue in bad faith until he arrives at his pre-ordained conclusion. And we accept this without a second thought.

Second City Network gives its explanation for Jan Brewer's mental glitch during her opening statement at the Arizona gubernatorial debate.

An Ohio church protests the local strip club on Saturday nights. Lately the dancers have been returning the favor on Sunday mornings.

The Onion captures the spirit of bigotry perfectly in Man Already Knows Everything He Needs To Know About Muslims.

Disturbing article in Thursday's NYT about the growing number of very young children being prescribed anti-psychotic drugs. Given that my wife is a two-time cancer survivor and my parents swear by their anti-depressants, I'm usually unimpressed by articles about the evils of modern medicine. But this caught my attention:

A Columbia University study recently found a doubling of the rate of prescribing antipsychotic drugs for privately insured 2- to 5-year-olds from 2000 to 2007. Only 40 percent of them had received a proper mental health assessment, violating practice standards from the American Academy of Child and Adolescent Psychiatry.

NYT columnists Gail Collins and David Brooks are mostly just fooling around during this conversation, but then Brooks lets loose the following bit of insight into the 8-28 Beck rally and the Tea Party mindset in general:

Every society has to engird capitalism in a restraining value system, or else it turns nihilistic and out of control. The Germans have a Christian Democratic set of institutions, enforced by law. The Swedes have their egalitarianism. Since the days of Jonathan Edwards, we have developed a quasi-religious spirituality that informally restrains the excesses of the market. God and Mammon are intertwined.
Many people feel that the values side of this arrangement is dissolving. Both the government and Wall Street are leaping into the void, to bad effect. … People like those at last weekend’s rally want the Judeo-Christian ethic back, which sweetened and softened life on the frontier (physical or technological). And so they march. They are only vaguely aware of this value system. It is so entwined into their very nature, they can not step back and define it. But they feel it weakening.
It might be possible for a responsible person to tap into this sense, but none has, so Glenn Beck has.

That's why I find Brooks to be the most frustrating columnist in America today. He'll write nothing but nonsense for months, and then off-handedly say something like that.

Check out Vanity Fair's look at Sarah Palin.

As best I can tell, this is not a joke: Alaskan Senate candidate Joe Miller wants you to help God fund his campaign.

It's never too early to start thinking about what not to get your little girl for Christmas.

The Weekly Sift appears every Monday afternoon. If you would like to receive it by email, write to WeeklySift at