David Warsh: Mitch Daniels's dire fiscal fears -- and his hypocrisy
‘Anxiety,’’ 1894, by Edvard Munch
SOMERVILLE, Mass.
The Republican Party is in disarray. Its House minority leader, California Rep. Kevin McCarthy, last week allied himself with disgraced former President Trump. Sen. Rob Portman (R.-Ohio), 65, director of the U.S. Office of Management and Budget (OMB) in 2006-2007, under President George W. Bush, announced that he would retire in 2022, after two terms. By current GOP standards, he’s considered a moderate.
But it was another G.W. Bush administration budget director who caught my eye, with an op-ed in The Washington Post last week. Mitch Daniels, who served George W. Bush as OMB director in 2001-2003, declared lost the battle to preserve the integrity of the welfare state that America fashioned in the 20th Century. That struck me as genuinely alarming.
In 2012, Daniels was a presidential hopeful, much in the mold of Mitt Romney, John McCain, George W. Bush, Bob Dole and George H.W. Bush. After leaving Washington, he had served two terms as governor of Indiana, in 2005-2013, where he was succeeded by Mike Pence. After deciding not to run, Daniels elected to become president of Purdue University, in West Lafayette, Ind.
“It’s no longer possible to say that, by starting now, we can avert massive, and massively unfair, changes in the promises we have made, or that current beneficiaries have nothing to worry about,” Daniels wrote. “That line was crossed even before the emergency budget blowout of 2020 added trillions to the debt tab we will dump on younger generations….
“No computer models are needed to see that there is zero chance of delivering on the promises already in place, let alone the fresh, astonishing proposals in Washington to make these commitments even larger,” he continued. The promises he has in mind are the Social Security System and Medicare, “so-called entitlement programs.”
Daniels is at least half right: There will be changes in promises that have been made, and they will be unfair. But the battle to preserve their outlines is still not fully joined. The preservation of the United States’ unwritten fiscal constitution is the single greatest crisis facing America in the 40 years ahead.
Worried about climate change? Deep forces are at work around the world, technological and political, which should gradually reduce carbon emissions to less dangerous levels. (That doesn’t mean we should stop pressing the matter.) General Motors’ announced intention to phase out gasoline- and diesel-powered vehicles by 2035 is one scrap of evidence. Exxon Mobil’s plan to reshape its beleaguered board in response to shareholder pressure is another.
Inclusion? President Biden’s plan to put some 1.3 million so-called Dreamers on a fast track to citizenship will be the first test of the strength of support for his ideas. The measure will face resistance in Congress. Gallup polls consistently show more that 75 percent of Americans favor immigration, as long as it is orderly. Return to the closed-border policies espoused by Trump seems highly unlikely.
Foreign relations? China and Russia have demonstrated that autocratic rule has its advantages, but aspirations to democracy have ways of making themselves known. War among global super powers seems even less likely than in the past. The U.S. has a proven role – as an exemplar of democracy, if it can keep it. The fear that a Trump-like demagogue could again be elected in America will, unfortunately, persist for decades,
Civil war? Unlikely, despite the crazies in Arizona, Texas, California, Oregon and Washington. But the possibility cannot be discounted altogether if the United States is unable to resolve its fiscal problems. A reminder of the difficulty of the problem was the breathtaking manner in which Daniels in his op-ed piece excused his one-time boss, George W. Bush, from a share of blame for the developing crisis.
“From very different directions, either of the past two presidents could have led the nation to a safer place, but neither had any interest in doing so,” he wrote. “Instead, both perpetuated the ‘noble lies – ‘You’re just getting your own money back,’ ‘We owe it to ourselves,’ etc. – by which the public has been misled through the years.”
What about ‘tax cuts that pay for themselves?’ Remember President 4-Percent-Growth, who successfully lobbied Congress to cut taxes even as he invaded Iraq? Remember Treasury Secretary Paul O’Neill who was fired by his boss for objecting?
Bush regained political sobriety in his second term, after trying and failing to privatize Social Security, when he appointed Ben Bernanke chairman of the Federal Reserve Board and, in 2008, backed him to the hilt in the financial crisis. Still: that a man so insulated from politics as the president of a major university should gloss effortlessly over the failings of the administration he served while decrying the failings of its successors indicates the magnitude of the problem.
I don’t think that any further evidence is necessary for today to say that macroeconomic arguments are likely to be the most important stories of the next forty years in America. But then I would think that. I am an economics journalist.
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A group of 10 Republican senators has asked President Biden to work with them on a bipartisan coronavirus-relief effort , as Democrats prepared to move forward on without GOP support, Kristina Peterson reported Sunday in The Wall Street Journal.
In a letter, the Republican senators asked to meet with Mr. Biden to present details of their proposal, whose overall cost they didn’t state, and said they were coming forward in response to his appeal for bipartisanship.
A journey of a thousand miles begins, or fails to begin, with a single step.
David Warsh, a veteran columnist and an economic historian, is proprietor of Somerville-based conomicprincipals.com, where this column first appeared.
Trying to put us back in charge
My old friend Philip K. Howard sent this along. It’s well worth reading, and joining Common Good. http://www.commongood.org/
-- Robert Whitcomb
Common Good has launched a national bipartisan campaign – called “Who’s in Charge Around Here?” – to build support for basic overhaul of the federal government.
The campaign, which has been endorsed by leaders from both political parties, will show how to remake government into simple frameworks that let people to take charge again. Rules should lay out goals and general principles – like the 15-page Constitution – and not suffocate responsibility with thousand-page instruction manuals.
The campaign is co-chaired by former U.S. Sen. Bill Bradley (D.-N.J.) and Common Good Chair Philip K. Howard. Among those who have already endorsed the campaign are former Governors Mitch Daniels (R.-Ind.) and Tom Kean (R-N.J.), and former U.S. Sen. Alan Simpson (R.-Wyo.) who co-chaired the Simpson-Bowles Commission on government reform.
Americans are frustrated. They can’t take responsibility. Bureaucracy is everywhere. The president can’t fix decrepit roads and bridges. A teacher can’t deal with a student disrupting everyone else’s learning. Physicians and nurses take care of paperwork instead of patients. A manager can’t give an honest job reference. Parents get in trouble for letting their children explore the neighborhood. Washington does almost everything badly. Take any frustration, and ask: Who’s in charge around here? That’s a problem.
Modern government is a giant hairball of regulations, forms and procedures that prevent anyone from taking charge and acting sensibly. No one designed this legal tangle. It just grew, and grew, and grew, until common sense became illegal. That’s the main reason that government is paralyzed. That’s why it takes a team of lawyers to get a simple permit. Every year, the red tape gets denser.
Our campaign will use video and social media to drive a national conversation to return to Americans the freedom to let ingenuity and innovation thrive in their daily lives. The campaign’s first three-minute video, narrated by Stockard Channing, uses white-board animations to explain how government should work. Titled “Put Humans in Charge,” the video is available here.
Americans know that common sense has taken a backseat to stupidity, but political debate has not drawn a clear link to suffocating legal structures. The campaign features “The Stupid List” showing how obsolete and over-prescriptive bureaucracy undermines infrastructure and the environment, schools, health care, jobs and the economy. The Stupid List is available here.
“Whether you are Democrat or Republican, you are a citizen first,” said Co-Chair Bill Bradley. “A functioning government serves a citizen’s interests. We need sensible reform that encompasses compassion and responsibility. Common Good demonstrates such an outcome is not impossible.”
“Voter frustration with broken government will only grow until Washington reboots to reset priorities and cut needless bureaucracy,” said Co-Chair Philip K. Howard. “It’s time to mobilize for a dramatic overhaul – replacing mindless compliance with common sense. That’s the only way to liberate American initiative and make government responsive to modern needs. America’s global competitiveness depends upon it.”
The campaign’s Website is Take-Charge.org. The campaign is active on Facebook, Twitter and Instagram. For further information, contact Emma McKinstry at emckinstry@highimpactpartnering.com.
Common Good (www.commongood.org) is a nonpartisan reform coalition whose members believe that individual responsibility, not rote bureaucracy, must be the organizing principle of government.
The founder and chairman of Common Good is Philip K. Howard, a lawyer and author of The Rule of Nobody (W. W. Norton) and The Death of Common Sense (Random House), among other books.
Will they still love him anyway?
Barker at the 1941 Vermont State Fair.
--- Photo by Jack Delano
Fox News, the broadcast wing of the Republican Party, last night applied its fact-checking skills to Donald Trump’s often absurd, contradictory, chaotic and fact-free “policy’’ prescriptions, while mostly giving Ted Cruz and the man whom Mr. Trump calls “Little Marco’’ Rubio a pass. The GOP establishment is terrified that the real estate developer/operator and “reality TV’’ star will win the nomination and drag the party into an historic defeat in the fall. Yes, he would.
Of course, Messrs. Cruz and Rubio’s allegiance to the truth has also sometimes been erratic, and they too are not averse to demagoguery, but Donald Trump is in another league. His career has been one con after another.
See: www.trumpthemovie.com
A question is whether Mr. Trump’s followers and potential followers see the way the debate was run -- to bring him down -- as unfair pilling on, leading Trumpists to double-down on their support of the carnival barker.
Unfortunately for their credibility, and even morality, all three non-Trump candidates on the stage said that they'd support the New Yorker if he wins the nomination. How could they in good conscience endorse someone Ted Cruz and Marco Rubio (John Kasich was milder) called dangerous, corrupt and otherwise immoral? They have been gentler even to Hillary Clinton.
Meanwhile, the amiable John Kasich took credit last night, as do other national politicians active in the ‘90s, for the prosperity and federal budget surpluses of the late ‘90s.
In fact, those happy things resulted from the money freed up by “peace dividend’’ from the end of the Cold War, an income-tax increase accepted bravely by President George H.W. Bush and the explosion in computer/Internet business, especially after Tim Berners-Lee invented the World Wide Web, in 1989. The last brought in tons of tax revenue and gave new high-paying jobs to many people, albeit mostly the well-educated.
Mr. Kasich had nothing to do with any of that. But he seems to be a nice man and a competent governor of Ohio, though I would have preferred to see the brilliant and innovative former governor of Indiana, and now president of Purdue University, Mitch Daniels on the stage instead.
-- Robert Whitcomb
Voters hiding from the world
The insularity of that minority (i.e., “the base’’) of the electorate that tends to dominate presidential campaigns’ first innings explains much of the current nasty race, especially on the Republican side.
These people seek to protect themselves from the anxiety of hearing a viewpoint they might not like by holing up in echo chambers in which the same fact-thin opinions are repeatedly shouted day after day. The epicenter is the oratorical masturbation known as political talk radio.
You’d think that listeners would get bored and occasionally want to hear something different, but that would make them uncomfortable. Talk radio does not encourage curiosity or research. The point is to soothe listeners by reinforcing their well-entrenched prejudices and satisfy their desirefor simple solutions to their problems – and clear villains.
The majority of talk-radio fans are middle- and lower-middle class white people aggrieved by their downward socio-economic mobility and upset about changing social mores as seen, for example, in gay marriage, and the changing ethnic and religious mix of America. That’s understandable.
But their refusal to listen to all sides in order to become better informed citizens also suggests a disinclination to make the changes, be it training for new work skills or bringing disorderly personal lives under control, necessary to address these tougher times for many Americans. Too many of them are both angry and passive.
That makes them prey to such demagogues as Donald Trump and Ted Cruz. Mr. Trump may be an especially fitting candidate for our times: People who avoid reading and obtain most of their “news’’ from TV and talk radio like him the most.
No wonder (relatively) scandal-free people of great executive and policymaking accomplishment who would have been very plausible presidential candidates in the past – say former New York Republican Gov. George Pataki and former Democratic Sen. Jim Webb -- don’t have a prayer. And such competent chief executives as Ohio Gov. John Kasich, former Florida Gov. Jeb Bush and former Maryland Gov. Martin O’Malley haven’t gotten much traction either.
And it’s hard to see Hillary Clinton, despite her long CV, intelligence, ambition and persistence, as a person of great executive and policymaking success. Bernie Sanders, for his part, is an eccentric fringe high-tax candidate in a nation whose citizens hate taxes. His only executive experience has been as mayor of Burlington, Vt.: pop: 42,000.
(A possible spanner in the works of a Hillary Clinton marchto theDemocratic nomination: indictment stemming from her “top-secret’’ home-server e-mails.)
You’d think that voters would want the nation’s chief executive to be or have been a successful elected executive of a government body. And no, running a business is not the same as running a government body.
Globalization and technology, both of which will continue to eat away at the American middle class, require a panorama of responses, including reducing our plutocracy’s ever-increasing power, more job training and rebuilding the nation’s decayed physical infrastructure to create jobs and make the nation more internationally competitive.
Cheapening labor and technology-based automation, which so far have mostly destroyed the jobs of blue-color workers, are now eating away even at what had been well-paying upper-middle-class jobs. Andsenior business execs show little desire to share more of their gargantuan compensation with underlings.
The candidates generally avoid presenting and emphasizing programmatic details because details don’t do well on TV and talk radio. And so many journalists have been laid off that the surviving ones almost entirely focus on the easiest and more marketable stuff in the campaigns - - the daily insults, faux pas and hour-by-hour opinion polls -– the horse race.
Apparently that’s fine with the people who hide in the silos of talk radio.
Once the candidates of the two major parties are chosen, perhaps more substance will appear as the candidates reach for support from moderate and independent voters. We can hope they’ll then explain with considerabledetail and precision what they’d do and, as important, how they’d do it.
Meanwhile, most of the electorate, the large majority of whom only bother to vote in November, can look into the mirror to see who is most to blame for our predicament.
Robert Whitcomb (rwhitcomb51@gmail) oversees newenglanddiary.com, is a partner at Cambridge Management Group (cmg625.com), a former Providence Journal editorial-page editor and a former International Herald Tribune finance editor,