Bill
Ryan Lizza in the New Yorker has an excellent piece on the decline of party insider influence and its effect on the nominee selection process. He makes the point far better than I have that the loss of central control has the net effect of producing nominees that cater to extremes within the party bases rather than to broad ideological coalitions.
As we both understand by now, I indeed have less faith in you in some sort of organic (market like as you like to say) sorting out of the country's direction by the electorate. You may be disgusted by Obama and the accomplishments of the 111 congress, but you don't seem particularly happy with its successor, not to mention the presidents likely opponents
I don't have a prediction on the 2012 election either, but I do believe it will have consequences, and some of those potential consequences strike me as disastrous in ways in which I'll wager we are likely to agree upon.
BTW, is there any reason to believe that the any of the current Republican alternatives will be more fiscally responsible than the current occupant of the White House?
Eli
Friday, March 2, 2012
The Extremism Canard
Eli,
I know your prediction on the death of the Republican Party was based on a big assumption, that it wouldn't change. But that's true of both parties. True of any competitive enterprise as well. Which is why I think this huffing and puffing by the Left over the purported shift to the right by the Republican Party is all rather amusing.
Has the GOP shifted rightwards? Maybe. I'm not a registered Republican, never have been, but let's use me as a proxy. Have I shifted right since January of 2009? Absolutely. The obscene increase in Government spending, the shocking increase in debt, the (in my opinion) blatant dis-regard of the markets and contracts and the bullying way Obamacare was passed resulted in me moving from what would be described as a moderate Republican to a Tea Party adherent. Notice what happened. I moved first. I didn't follow the Party. I moved and clearly I'm not alone.
So what has been the GOP's reaction to this movement by their constituent's move to the right? It moved to the right. It had to if, as you point out, it wanted to survive. This is why I find the criticism of the Tea Party and the rightward movement of the GOP as amusing. In essence, the Democrats are saying, not to the Republicans, but to the electorate, "You are stupid robots controlled by evil Fox News and the Koch Brothers." To me, they (and you) are mis-understanding, at the most basic level, why the GOP is where it is. The GOP is reflecting the wishes of Americans and the Democrats are insulting the electorate. FYI, insulting me is not the best way of persuading me.
I won't predict what happens in 2012. Maybe the Tea Party reaction will cause a counter reaction, which will cause another reaction, the dialectic process that brings us to the middle. You seem to worry about partisanship and paralysis. I don't. All that's happening is the country is trying to figure out its path forward. In many ways, it's like the market. Lots of individual decisions arrives at a consensus (or equilibrium in economics jargon) that splinters, then reforms via constant iteration to another consensus, and so on.
Bill
Does The Decline Of Political Parties Contribute To The Current Paralysis
Bill
Nice to know I'm in such august company. To be fair, I gave myself more than a little wiggle room when I stated that the Republican Party was doomed in its present form. It is the enduring ability of both parties to transform themselves that has produced their longevity. Just think of where all those yellow dog Democrats have gone. It's hard to imagine though, that a party comprised of mostly male, middle aged and older, hyper religious anti immigrant whites will compete very well in a nation that is destined to become minority majority in a very short time.
The vital story of this Republican primary season is the loss of the ability of the party itself to control the agenda as it has done so effectively in the past. Jay Cost, a staff writer at the Weekly Standard, and former blogger at Real Clear Politics, has written extensively about the decline of the power of party elites on both sides to mold the agenda. That loss is what leads to the fractious competition of the current primary season and the ridiculous pandering of candidates who know better (think Romney) to every extreme notion that's out there. The Dems experienced the same fragmentation in the late 60s that reached its apex with the McGovern debacle in 1972. It may be undemocratic of me to say so, but it's easy to argue that such a decline in centralized party power erodes the possibility for compromise in a nation already deeply divided over how to solve its problems.
Eli
.
Nice to know I'm in such august company. To be fair, I gave myself more than a little wiggle room when I stated that the Republican Party was doomed in its present form. It is the enduring ability of both parties to transform themselves that has produced their longevity. Just think of where all those yellow dog Democrats have gone. It's hard to imagine though, that a party comprised of mostly male, middle aged and older, hyper religious anti immigrant whites will compete very well in a nation that is destined to become minority majority in a very short time.
The vital story of this Republican primary season is the loss of the ability of the party itself to control the agenda as it has done so effectively in the past. Jay Cost, a staff writer at the Weekly Standard, and former blogger at Real Clear Politics, has written extensively about the decline of the power of party elites on both sides to mold the agenda. That loss is what leads to the fractious competition of the current primary season and the ridiculous pandering of candidates who know better (think Romney) to every extreme notion that's out there. The Dems experienced the same fragmentation in the late 60s that reached its apex with the McGovern debacle in 1972. It may be undemocratic of me to say so, but it's easy to argue that such a decline in centralized party power erodes the possibility for compromise in a nation already deeply divided over how to solve its problems.
Eli
.
Obama Did Not Save the Auto Industry. He put GM Under and Sold Chrysler to the Italians.
Eli,
Obama did not save the auto industry. He put GM and Chrysler into bankruptcy and then sold Chrysler to an Italian company, Fiat.
Since the mid 70's US auto sales have been between 10 and 20 million units per year. In the recession years of 1980 and 2009 sales fell to 10 million units. While the 2009 downturn was severe, it wasn't Obama's favorite word: Unprecedented.
What did change between 1980 and 2009, for GM, was its US market share. Here's the way I look at it. Every day consumers decide which car they want to buy. And for the past 50 years consumers have said, "something other than GM." That's 10 to 20 million purchase decisions every year times, let's call it $30,000 per car, or $30 to $60 billion per year. The decision to interfere in those individual purchase decision is what I like least about bail outs. In essence the government substitutes its judgement for the individual.
At the cyclical peak in 2007, GM and Chrysler comprised 36% of the US auto market. Obama didn't even save half of the auto industry. Arguably he saved the most inefficient producer(s). Bailing out GM and Chrysler is like supporting Blackberry because it used to have high market share, but now consumers prefer Apple and Android. It's like saving the Black and White TV market when everyone wants color. It's like saving the bank teller industry when consumers prefer ATMs.
According to the Bureau of Labor Statistics, the US auto industry employs about 670,000 in auto, auto body and trailer and auto parts manufacturing. The numbers include white collar workers who work at manufacturing concerns. Most of the workers are in auto parts.
How many does GM employ? At the end of 2011, about 77,000 in the US, of which, 29,000 were salaried and 48,000 were hourly. In 2006 GM had about 152,000 North American employees. The comparison is not fair since the 2006 amount is total North American headcount, which includes Canada and Mexico, and also includes some units not counted in 2011. But the trend is the same. Even after the bailout, headcount is lower, much lower.
GM and Chrysler are not the auto industry. Not even close.
Here's what Rick Wagoner said about GM going into bankruptcy (From "Overhaul," by Steve Rattner, Obama's auto czar). "Bankruptcy would sink the business by scaring off customers." GM's market share had declined from 50% to 20% without the threat of bankruptcy. I'd remind Wagoner something else was scaring off customers long before the recession hit. Secondly, GM is 20% of the industry, not the industry, and what would customers have done? Buy something else. What would competing auto makers have done? Hire more workers to handle the increased demand.
What did Obama do? He put GM in bankruptcy. He put Chrysler into bankruptcy. He sold Chrysler to the Italians. He fired workers. Since the end result is possibly the same thing as would have happened if Obama had ignored the whole issue, why am I unhappy with the intervention?
It put taxpayer money at risk, and the Government should not play venture or vulture capitalist. This is a centuries-old argument, but the long experience teaches us the Government is a poor capitalist. Second, it explicitly says to consumers, "Your choice has been wrong, and will we decide what is best for you." For 50 years consumers have been telling GM, we prefer something else. Obama's response: Too bad. Eat your peas. Third, it made the car companies political entities. Obama decries Citizen's United, but somehow thinks the direct intervention into private business that will be a source of political patronage and votes is a good thing? Fourth, it is unfair to the 400,000+ non GM and Chrysler auto workers. Last, it makes it more likely others will ask for government support. Which is bad for consumers. 10 to 20 million purchase decisions are distorted to benefit less than 100,000. How is that fair? How is that playing by the same rules?
Bill
Obama did not save the auto industry. He put GM and Chrysler into bankruptcy and then sold Chrysler to an Italian company, Fiat.
Since the mid 70's US auto sales have been between 10 and 20 million units per year. In the recession years of 1980 and 2009 sales fell to 10 million units. While the 2009 downturn was severe, it wasn't Obama's favorite word: Unprecedented.
Source: Wolfram Alpha
What did change between 1980 and 2009, for GM, was its US market share. Here's the way I look at it. Every day consumers decide which car they want to buy. And for the past 50 years consumers have said, "something other than GM." That's 10 to 20 million purchase decisions every year times, let's call it $30,000 per car, or $30 to $60 billion per year. The decision to interfere in those individual purchase decision is what I like least about bail outs. In essence the government substitutes its judgement for the individual.
Source: Ward's Auto Data
GM has about 20% market share, where's the rest? Ford is 16%, Toyota 13%, Chrysler 11%, Honda 9%, then a whole bunch of others. But GM, Ford and Chrysler are American you may say, so they deserve special treatment. Maybe. Chrysler used to be owned by the Germans, remember Daimler Chrysler, and is now owned by Fiat. The Japanese and German auto companies have manufacturing plants in the US, so in that sense they are as American as GM and Ford and Chrysler.
Source: Ward's Auto Data
At the cyclical peak in 2007, GM and Chrysler comprised 36% of the US auto market. Obama didn't even save half of the auto industry. Arguably he saved the most inefficient producer(s). Bailing out GM and Chrysler is like supporting Blackberry because it used to have high market share, but now consumers prefer Apple and Android. It's like saving the Black and White TV market when everyone wants color. It's like saving the bank teller industry when consumers prefer ATMs.
According to the Bureau of Labor Statistics, the US auto industry employs about 670,000 in auto, auto body and trailer and auto parts manufacturing. The numbers include white collar workers who work at manufacturing concerns. Most of the workers are in auto parts.
Source: BLS
How many does GM employ? At the end of 2011, about 77,000 in the US, of which, 29,000 were salaried and 48,000 were hourly. In 2006 GM had about 152,000 North American employees. The comparison is not fair since the 2006 amount is total North American headcount, which includes Canada and Mexico, and also includes some units not counted in 2011. But the trend is the same. Even after the bailout, headcount is lower, much lower.
GM and Chrysler are not the auto industry. Not even close.
Here's what Rick Wagoner said about GM going into bankruptcy (From "Overhaul," by Steve Rattner, Obama's auto czar). "Bankruptcy would sink the business by scaring off customers." GM's market share had declined from 50% to 20% without the threat of bankruptcy. I'd remind Wagoner something else was scaring off customers long before the recession hit. Secondly, GM is 20% of the industry, not the industry, and what would customers have done? Buy something else. What would competing auto makers have done? Hire more workers to handle the increased demand.
What did Obama do? He put GM in bankruptcy. He put Chrysler into bankruptcy. He sold Chrysler to the Italians. He fired workers. Since the end result is possibly the same thing as would have happened if Obama had ignored the whole issue, why am I unhappy with the intervention?
It put taxpayer money at risk, and the Government should not play venture or vulture capitalist. This is a centuries-old argument, but the long experience teaches us the Government is a poor capitalist. Second, it explicitly says to consumers, "Your choice has been wrong, and will we decide what is best for you." For 50 years consumers have been telling GM, we prefer something else. Obama's response: Too bad. Eat your peas. Third, it made the car companies political entities. Obama decries Citizen's United, but somehow thinks the direct intervention into private business that will be a source of political patronage and votes is a good thing? Fourth, it is unfair to the 400,000+ non GM and Chrysler auto workers. Last, it makes it more likely others will ask for government support. Which is bad for consumers. 10 to 20 million purchase decisions are distorted to benefit less than 100,000. How is that fair? How is that playing by the same rules?
Bill
Thursday, March 1, 2012
Save Western Union!
Eli,
What if some Congressman started a crusade to save Western Union? What would you think? What would most people think? I'm guessing the common reaction would be, Why? Why save a service when there are alternatives that are so much faster, cheaper and more convenient?
What if some Congressman started a crusade to save Western Union? What would you think? What would most people think? I'm guessing the common reaction would be, Why? Why save a service when there are alternatives that are so much faster, cheaper and more convenient?
And it seems to me, we are in the same position with the US Postal Service. The New York Times has an editorial on the Postal Service's woes, that makes an excellent point then goes off the rails pretty quickly.
It seems to me the ontology of the Post Office recapitulates the phylogeny of the Federal Government. A perceived (not necessarily actual) market failure results in a government solution, which crowds out market-based solutions, becames a bloated, sclertoic, enterprise unresponsive to consumers and ultimately falls victim to cheaper, faster, more convenient offerings. But the inertia of the organization and the desire by politicians to hold onto power and patronage prevent progressive change (with all that alliteration I feel like Spiro Agnew!) to the organization, ultimately resulting in a funding crisis.
We have witnessed the future of Obamacare. It is called the USPS.
Bill
Famous Predictions
Eli
Before you begin any funeral services for the GOP or the Democrats
"Dewey Defeats Truman." Chicago Tribune, November 3, 1948
"We will bury you." Nikita Kruschcev to the West, November 8, 1956
"What would I do? I'd shut it down and give the money back to the shareholders." Michael Dell, October 5, 1997 on asked what he suggested should be done with Apple Computer.
"Barack Obama is not going to beat Hillary Clinton." William Kristol, December 17, 2006
"Is the Republican Party Dead?" The Guardian, November 6, 2008
"I'm here to tell you that on November the 3rd, the Democrats will retain a majority of the House, a majority of the Senate." VP Joe Biden, October 4, 2010
"This is not a helpful sign, and yet more evidence that the Republican Party as it is currently constituted is headed for the ash heap of history." Eli Butcher, March 1, 2011
Bill
The Sad News Of The Week
Bill
Sorry you'll miss Davey Jones. The sadder news for me is Olympia Snow's decision to retire from the Senate. This is not a helpful sign, and yet more evidence that the Republican Party as it is currently constituted is headed for the ash heap of history
Eli
Sorry you'll miss Davey Jones. The sadder news for me is Olympia Snow's decision to retire from the Senate. This is not a helpful sign, and yet more evidence that the Republican Party as it is currently constituted is headed for the ash heap of history
Eli
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