Too Little, Too Late to Change This

Let's talk about the country the next President inherits. As we close in on November 5th, I have been hearing two competing visions of the only country we have.

One says our economy is strong and getting stronger. Inflation has been tamed, economic and job growth are strong and interest rates are coming down as we enter a new phase of pandemic recovery. Salaries are rising faster than the rate of inflation, crime and unemployment are at a record low.

Problems? Sure. The US-Mexico border is a continuing leaky sieve and prices that rose after the Covid period have, in many cases, not come down. Housing prices are still too high and the supply of homes is anemic. But the trend lines I showed you a couple of weeks ago are all in the right direction.

The other vision I'm hearing is that America is the world's "garbage can." The US economy is a hellscape of hungry, homeless people where jobs are either shipped overseas or taken from you by illegal immigrants. this is the result of a country led by “a radical left, Marxist, communist, fascist.”

I'm still figuring out how you can be all of them, but I'll holler when I do. Oh, and crime is running rampant, even though it's not.

From the first Trump inaugural address...

"Mothers and children trapped in poverty in our inner cities; rusted-out factories scattered like tombstones across the landscape of our nation; an education system, flush with cash, but which leaves our young and beautiful students deprived of knowledge; and the crime and gangs and drugs that have stolen too many lives and robbed our country of so much unrealized potential.

This American carnage stops right here and stops right now."

The folks at Vox did an annotated version of the speech. A sample...

In reality there were more people employed in the United States in January 2017 than at any previous time in American history, and inflation-adjusted wages are higher than they have ever been.

Trump often paints a blighted picture of poverty in “inner cities,” but there are more poor people in American suburbs than in urban centers. 

There are certainly rusted-out factories in America, but the United States has never enjoyed larger manufacturing output than it does today.

The United States spends more per student than nearly all developed countries. 

And these same lines could be from a Trump rally today. So, why do we believe them? Why do people respond?

Well, for a lot of folks, things are tough right now. At the grocery store, the inflation that occurred during and after the pandemic when supply chains imploded, hasn't come down. Since supply is not the issue, one might reasonably ask, why? And more importantly, what can Trump or Harris do about it?

Housing prices are high and the supply of homes is low. What can Trump or Harris do about that? Trump says if we drilled for more oil, over and above the record amounts today, the country would be wealthier and freed up government land could be used for drilling, or building more homes. In West Texas?

Harris is talking about tax breaks for builders and down payment assistance for buyers. That costs money. A lot of money.

Jobs? The Trump answer is simple, tariffs on literally everything we import. That also costs the American consumer money. A lot of money. Note, the consumer pays for tariffs, not China, Mexico or Canada. Hello inflation my old friend, it's good to talk with you again.

Add to the tariffs the proposals to eliminate taxes on tips, auto purchases, and Social Security. That's even more money. Trump blew up the deficit before Covid hit, and this is guaranteed to do it as well.

Harris will indeed add to the deficit as well, according to economists, but only half as much. Sort of like the old Preparation H commercials. As a comedian friend said of the hands coming closer together in the ad, "if that's your problem, half of that isn't really a solution."

So, why does the negative picture of things seem to have more appeal to people? One reason is psychology.

UC Davis psychology professor Alison Ledgerwood studies framing effects, or how people process information based on how it’s presented to them.

Say a candidate proposes a new jobs policy — Jobs Policy A. You don’t know much about it. But one of the first things you hear is that it will save 60 percent of manufacturing jobs. Your friend, meanwhile, is told that 40 percent of jobs will be lost.

It’s the same policy, with the same results, so all else being equal, you and your friend should have a similar outlook on it, right? What research actually finds is that you are more likely to respond favorably, because the information about it has been framed in terms of success. Whereas your friend, who has been thinking of the policy in terms of failure, is not a fan.

Ledgerwood and her colleagues have also found that a negative frame is much more persistent, or “stickier,” than a positive one. If you come at an issue negatively, but are later reminded of the policy's positive aspects, you will still think it's a bust. And if you start out thinking favorably about the policy, but are reminded of its downsides, your positive perception will be swept away and a negative one will take its place.

In other words, When you are told the glass is half empty, you ignore the fact that it's also half full. Trust me, when it comes to Jameson's, that's an important consideration.

And why do many middle and lower class folks feel forgotten? Because they have been. That makes them vulnerable to a convincing pitch from unscrupulous politicians.

We would like to think that we are much more egalitarian and open to upward mobility than, say, Brazil. But Professor James Robinson of the University of Chicago, and co-winner of this year's Nobel Prize for Economics, says this...

Let’s take a look at Brazil. Fifty-five percent of the national income accrues to the richest 10 percent of the population. This is both because the distribution of assets is highly skewed and this is intensified by institutions which make sure that the resulting income distribution remains skewed. The same can be said for other Latin American countries. In the United States, 47 percent of the national income accrues to the richest 10 percent of the population. And while the U.S. has seen a big increase in national income and wealth over the last 30 years, average (median) wages have not changed at all. 

We keep getting fooled by things like supply-side, or "Trickle Down" economics that simply didn't work, or in today's case, "America First." And, while a phrase like income inequality might sound like something from a meeting of the Politburo, it's the same over there. Once you pass the outskirts of Moscow, you might as well be in Namibia.

I did a little PR work for General Motors a few years ago, and was talking with the man who ran the company benefits program for GM. We had long since given up on the Clinton healthcare reform idea, and ObamaCare was not a thing yet. He lamented the cost of healthcare for the company and how it differs geographically. "How is childbirth so much more expensive in Los Angeles than in Tulsa? If we priced cars that way, the public would revolt."

He explained that Toyota doesn't have this problem because of an excellent national healthcare system. It is simply not an issue in employee negotiations.

And our school financing system is simply crazy. If an area, say Saginaw, Michigan, loses a factory and the community resources go with it, the funding for local public schools takes a hit. The kid with the cure for cancer locked in their head may live in Saginaw, but will he or she get the education they truly need? Europe has figured this out, but we simply buy more TV ad time to fight change.

So, it is no wonder that, as I sit here, and given his warts and all, it looks to me like Captain Combover may get another lease on that big place on Pennsylvania Avenue. The folks that are feeling all this are frankly desperate and are willing to give him another try, you know, because of the price of eggs, I guess.

But they are actually hurting and no one seems to care. So they'll try the guy with the gold-plated toilet one more time.

And the opinions of retired four-star generals, former heads of major corporations, Nobel Prize winning economists and foreign policy experts don't really matter because he says they are incompetent, and in the case of General Kelly, degenerate and incompetent. That requires the voter to ponder how revered institutions like the US Marine Corps, US Army and Exxon could be so wrong about the leadership they chose.

But that's the state of the race now. Arab-American voters are so upset with events in Gaza that they are willing to turn foreign policy over to a man who has no qualms about giving a blank check to Bibi. That makes no sense for them, you say? Just like so much today, of course it doesn't. And that includes the small bit of amnesia they seem to have about who started this latest round.

I just assume that the next President will find his Roy Cohn for Justice and Hermann Goering for the Pentagon. After all, he has asked for both.