The Curse of Conventional Wisdom

Conventional wisdom, understandings about life and the world developed by past generations, has always been with us.  Hundreds of years ago Galileo experienced the downside of conventional wisdom when he had the temerity to suggest the earth was round and ended up imprisoned.

Our education is rooted in teaching conventional wisdom.  We go to school (or church) to memorize facts and ideas that our elders deem important.  Ideally it is a starting point for understanding life.  But our increasing sophistication and rapid growth of technology makes one suspect conventional wisdom is becoming ever more of a drag on society.  

Biologically our brains seem to be hardwired to suck in information through our teens but our brain begins to become less flexible as we become an adult.  In prior ages formal education ended very young for most people, so they were out in the world being forced to problem solve to survive very early in life.

Today conventional wisdom says if you want to do well in life you need at least a college education, which means continuing to memorize conventional wisdom into early adulthood, where we begin to approach the point where our brain is already losing some of its ability to be flexible in our thinking.

Education can help one learn to cultivate flexibility, but often to do that requires rejecting conventional wisdom the instructor is attempting to impart.  That often means you end up getting a lower grade than those who just figure out what the instructor wants to hear and regurgitate it.

Bill Gates, Steve Jobs and Mark Zuckerberg didn't care about building a resume so they could get get a good job, they were interested in solving problems.  So they dropped out of college to avoid having to regurgitate conventional wisdom and started solving problems.  That approach can work in a career founded on advancing technology because you can physically demonstrate your understanding by building a better machine.  But it doesn't work so well in social sciences, economics or politics as they are rooted in more abstract ideas.

So social sciences, economics and politics end up being dominated by the folks who did the best job of absorbing conventional wisdom.  They got great grades, great first jobs and go from there.  But they are often limited in their problem solving ability by mistakes in the conventional wisdom their thinking is rooted in.  They have a hard time figuring out how to deal with data that contradicts conventional wisdom and find it emotionally difficult to contradict the conventional wisdom they spent years learning.

Politics of today presents perhaps a perfect example.  Economic data covering the last 100 years shows a vast gap in the economic health of the country between the half century when the US imposed income taxes at rates of over 50% on the wealthiest taxpayers and the half century when the highest tax rate paid by the wealthy was under 40%.   In the high tax years growth averaged nearly 3% per year, while the National debt was stable.  In the low tax years debt exceeded growth. 

Conventional wisdom says high income taxes limit growth.  As a result neither political party seems capable of accepting that fact the data contradicts conventional wisdom.

Accepting the truth the data suggests may fall to generations to come who are exposed to the data before their thinking loses flexibility.  We don't seem currently  capable of dealing with it.

The Deep State

Republicans, and particularly President Trump, have spoken frequently over the last few years about this mysterious, malignant Deep State that is undermining our countries greatness.

It was kind of mysterious since they never really explained what, or who, the Deep State was, much less offered any proof that it actually existed.  It was a great sound bite though.

President Trump has provided clarification. The Deep State he speaks of is in fact the institutions and laws that create the checks and balances our political system is built on.  Those checks, balances and processes do not allow him to use tax payer money as a carrot to entice other countries to investigate his political rivals.  They hinder his efforts to team up with like minded folks like Vladimir Putin, Mohammad bin Salman of Saudi Arabia or Turkey's Recep Erdogan to forward his personal power and influence.  They make it difficult to funnel all Federal employee overnight stays into his properties.  They expose the folly of his impulsive decision making in matters of grave importance to the country, and his tendency to mistake developing personal relationships with world leaders with representing the interests of this country.

Voters need to start challenging any politician that starts talking about the "Deep State" to be specific and offer some evidence.

Attorney General Barr - A 21st Century Royalist

During the Revolutionary war the residents of what became the United States were divided into two camps.  The Revolutionaries who prosecuted the war and the Royalists who supported the King.

Even after the Revolutionaries won the war there was still an undercurrent of support among the folks that were well situated in life for the concept of a King, and many urged George Washington to become King.  The Royalist view is fundamentally if you can scramble your way to the top, or hang out with someone who has, you are untouchable.

Washington rejected the the notion the King of England, who was above the law, would be replaced by a King of the United States who was above the law.  One of our Constitutional Conventions most fundamental goals was to establish the no one in government is above the law.

Attorney General Barr seems to have failed to grasp this basic purpose of the revolutionary war and the subsequent adoption of the Constitution.  He regularly dismisses the investigations in President Trump's behavior, even though the pile of evidence continues to build that the President ignores the law, seeks to circumvent the law or simply outright lies about his behavior to hide illegal activities.  The Attorney General bases his notions on vague ambiguities in the Constitution that he believes prevent the President from being subject to the laws the rest of the Citizens of the United States are bound by.  He ignores one of the primary principles our nation is build on.

Mr. Trump is willful and runs on instinct, so he is not a good judge of character and as a result his administration has been marked by chaos and constant turnover in critical government positions.  The chaos has infected our foreign policy, and our economy

But in terms of protecting President Trump for the consequences of acting illegally the President hit a home run in appointing Attorney General Barr, a modern day Royalist who thinks King Trump is above the law.

Bernie, Elizabeth and Joe

From 1933 to 1980 the wealth of this country grew twice as fast as it has grown from 1981 to today.

From 1933 to 1980 we averaged 2.7% growth per year and our National debt ended where it started at 30% of GDP.   Since 1981 total GDP growth is 105%.  But the National debt has grown from 30% to 105% of GDP, a 75% increase.  Subtract the 75% debt growth from the 105% output growth and our actual wealth as a country only increased about 1.4% of GDP per year. 

The difference between 47 years of growing wealthier by 2.7% per year and 37 years where we have grown wealthier by 1.4%?   Trickle down economics.

From 1933 to 1980 the highest income tax rate averaged around 80%.  Since 1981 the highest tax rate has averaged under 40%.  The robust debt free growth from 1933 to 1980 flies in the face of the notion taxing the rich hurts the economy.  In fact it appears high tax rates changed rich folks behavior - they kept more money in productive activity instead of pulling it out to stash in safe wealth storage.  The result was from 1933 to 1980 the rich got richer even as the middle class experienced a growth in income that today contrasts with the stagnant incomes of their children.

If we want to turn our economy around and enjoy real growth rather than just piling up debt this coming election should be about major structural change to our tax laws.  Who can best accomplish that goal?

Probably no Republican. Tax cuts for the rich have always come from Republicans and have been the primary Republican accomplishment over the last 37 years.

So that leaves the Democrats.  

So far, though, the Democratic candidates seem stuck in 20th century Capitalism v. Socialism thinking.  Thinking the solution to stagnant middle class incomes is in using the law to extract money from wealthy folk without giving any thought to economic efficiency or the impact on productivity and growth.  21st century thinking should be bringing more carrots into the tax code instead of relying on regulatory sticks.  Incentivizing productive activity and discouraging speculation and exploitation.  But no Democratic candidate seems to care about what happened from 1933 to 1980.

Joe doesn't even seem interested in major structural change.  He seems like he just wants to captain the ship, making slight changes in course.   Amy also seems to be in the Joe mold.  Don't rock the boat.

Bernie promotes structural change, but his touchstone seems to be a modified form of Socialism, heavily reliant on the 20th century regulatory sticks oblivious to market forces.  He does not seem flexible enough to start thinking about carrots.

Elizabeth also seems stuck in the 20 century, but does seem to be a more flexible problem solver.  However since she has taken regulatory stick based positions (wealth tax for example) during the campaign she may be reluctant to give her detractors ammunition by changing her mind.

Pete?  Kamala?  It's not clear either of them have any economic plan, nor is it clear they perceive any need for structural change.

I think voters are going to have to figure this out first and start asking why we can't have the consistent 2.7% debt free growth that spread wealth all though the economy that characterized US life between 1933 to 1980.

For data spreadsheets about the data cited above link to

 http://www.theidp.org/data-compilations.html

For a broader discussion of historical economic performance see the volume "Curious Correlations:  Party Politics and Economics" available at Amazon books.

https://www.amazon.com/s?k=Curious+Correlations%3A+Party+Politics+and+Economics&i=stripbooks&ref=nb_sb_noss

Fox News Has Become Obsessed With California

Almost every day these days my news feed pops up with stories from Fox News how bad things are in California.

Part of the Fox News business model for decades has been to promote a brand of conservatism that focuses on keeping taxes on wealthy folk as low as possible - maximizing the power and influence of the folks that own Fox News.  Even though low taxes on the wealthy are not beneficial to working folks Fox News has been very adept at cultivating voting support for their political goals with a divide and conquer strategy.  

They exploit the natural human tendency to note physical or cultural differences by vilifying politically weak minorities then convincing folk they need to vote conservative to keep those bad people from ruining everything.

Now that strategy is threatening to blow up in their face.  We have a President whose knowledge of public policy seems to have been shaped by Fox News, who is almost joined at the hip with Fox News.  A President who, in three years, has effectively abandoned Asia to despots, undermined the world economy with his ill conceived and poorly executed tariffs, destroyed arms control agreements without offering an alternative, exploded our national debt and demonstrated a constant lack of any heart or compassion.  A President on his way to becoming the first President in history to repeatedly collude with foreign governments to help his business and personal political agenda.

On top of the Trump problem Fox News has lost gay rights as an issue as gays have moved mainstream, Pro-lifers are creating their own party with socialist leanings and vilification of immigrants is effective on fewer and fewer voters as noisy immigrant bashing is causing many to realize immigrants are not bad people and maybe deserve a little compassion.

So evidently Fox News new plan to is in part vilify California.  It is California politicians that are leading the impeachment probe of our truthfulness-challenged President.  Republicans controlled California in the 1980's and 1990's but folks got so sick of them they are virtually an endangered species in modern California.  Of course a State of 40 million people has some problems (many of which are leftovers from the days Republicans ran the state)., but the reality is California has a budget surplus, is the wealthy, happy and provides decent health care to a bigger percentage of folks that any Red State.  The success of Democratic California is a thumb in the eye of the conservative ideology Fox News peddles.  

So they seem to be seizing the opportunity to try to undermine the impeachment effort by convincing red state groupies that California is not to be trusted.  Unfortunately for them, Donald Trump has left so much evidence scattered in the chaos that follows him through life it is becoming clear to all but the most blindly partisan groupies that he is undermining the traditions and government of checks and balances that have sustained our democracy for 2.4 centuries. 

I thought, as I was living through the Nixon years, I was witnessing something the likes of which would not repeat in my lifetime.  But now it appears even Watergate is being Trumped. 

How Can We Prevent California Wildfires?

The conditions that cause enormously destructive wind/fire storms -  lack of rain and dry winds - occur virtually every year, and may be getting worse.  We can't stop wildfires from occurring but we can fix the problems that turn a wild fire into a firestorm.   

PG&E is where a lot of fingers are pointing.  There is no question PG&E, like all corporations, and many people, finds it hard to spend money on long term public safety in the face of short term desires to maximize profits and executive bonuses.  PG&E is justifiably in bankruptcy for their negligent practices and are not be be excused.

But we shouldn't lose sight of all the other factors that play as big a part, or perhaps a bigger part in these disasters.

The fires generate massive fires storms because big parts of the State are undeveloped land.  Over the decades they develop huge "fuel loads" - overgrown forests and underbrush that are ideal incubators for a fire storm.

Who owns all this land?  Why don't we require landowners to reduce the fuel load regularly?  It could cost a lot less to create a mechanism to enforce fuel load reduction than it does to fight and then clean up the mess after one of these huge fires.

Probably a lot of the land is owned by investors who are essentially parking wealth in an asset that is indestructible and costs them little.  Their will be objections about intrusive government and personal freedom.  But I submit this is an area where the tension between individual rights and community safety should tilt heavily towards community protection.  

By letting these landowners ignore fuel overloads on their land we are allowing them to impose enormous costs in fire fighting, loss of life and property destruction on other people and government while they wait to reap a profit from selling their land.  

Reducing fuel overload doesn't have to be a huge expense, some local governments have taken to hiring goat herds to graze off the underbrush.

What is foreseeable can be mitigated  We need to be willing to spend some money on fuel load reduction and enforcement if we want to reduce the size and destructive power to these fall firestorms.

Corporations Are Not People*

The 2010 Supreme Court decision that found corporations have the same free speech rights as individuals is built on a foundation of logic divorced from reality.  

Corporations in the United States are created under State law.  Without State legislation creating rules for them to exist and regulating their conduct they do not exist. Modern Corporations effectively did not exist when the Constitution was written and were not mentioned in the Constitution.(footnote 1).   Yet somehow Conservative Supreme Courts miraculously divined that the founding fathers intended the first amendment to give Corporations the same free speech rights people enjoy.  

As a result corporations have an almost unfettered right to seek to influence government policy and can do so behind a dizzying array of shell corporations hiding who is really behind the message.  We now have campaigns that never end and spend more money on political advertising than our forefathers could have imagined in their wildest fantasies.  Income inequality and our National Debt have exploded.

To protect this gift from the Supreme Court Corporations have funded organizations whose entire purpose is to protect the ability of Corporations to use the massive money they generate to influence elections.  

There are also organizations seeking to amend the constitution to clarify that corporations are not people.  Here is a link to one. https://www.americanpromise.net/5-reasons-we-need-an-amendment-to-say-corporations-arent-people/?   But a Constitutional amendment is difficult because Corporations are willing to spend so much money to undermine those efforts.  So the people who reject the notion corporations have the same constitutional rights as people have been sadly ineffective.  

The supporters of a Constitutional amendment seem unaware, or unwilling to use the leverage they have to push Corporate interests to the table to develop a more acceptable view of Corporate rights.

Since Corporations are created under State law, states have a lot of leverage not available to Congress.  If enough big urban States linked limited liability to consent to regulation of political spending for all corporations formed or operating within their state no big corporation would give up those markets to protect their right to spend bundles of money influencing national elections.

Just saying - if we want to make progress on overturning this crazy decision we can't let Corporations define the playing field.

Footnote 1 - https://www.repository.law.indiana.edu/cgi/viewcontent.cgi?article=2255&context=facpub

*  The title for this blog is borrowed from a book by the same title that is a great source for in depth discussion of the topic - "Corporations Are Not People" by Jeffrey D. Clements.