Category: GOVERNMENT

UNIONIZATION

Nolan clearly illustrates how important political power is in balancing corporate owner/managers’ disproportionate incomes and privileges with labor.

Books of Interest
 Website: chetyarbrough.blog

“The Hammer” (Power, Inequality, and the Struggle for the Soul of Labor)

By: Hamilton Nolan

Narrated by: Franklin Pierson

Hamilton Nolan (Author and free-lance Journalist)

“The Hammer” is a paean to unionization. Unions lost much of their political power in the early 1970s. Political power of labor was diminished by State governments, poor labor union management, and a diminishing number of labor union members. Nolan’s argument is workers have to reestablish political power to change their unfair and inequitable relationship with business.

The widening gap between rich and poor is traced to the era of President Reagan when the first deep cuts in corporate taxes occur.

Reagan fought unionization by firing air traffic controllers that sought better wages. Reagan’s supporters believed government social programs were out of control and their cost diminished the power of free enterprise. Much of the American public either agreed or were apathetic. However, as the gap between rich and poor accelerated, Americans began to complain about inequality. With extraordinary income increases for business owners and CEOs, and repressed wages for workers, the need for unionized political power became self-evident. Nolan introduces his book about unionization with a brief biography of Sara Nelson.

Sara Nelson (AFA president of the Association of Flight Attendants.)

Nolan writes about Sara Nelson who became a union member when she worked for United Airlines as a stewardess. Nelson was born and lived in Corvallis, Oregon. She applies for a job with United Airlines in St. Louis. She gets the job but her first paycheck is late. She couldn’t pay her rent. A check is given to her by a union employee to tide her over until her first check is delivered. From that day forward, according to Nolan, Nelson became a supporter of unions. Eventually Nelson becomes the president of the Association of Flight Attendants (AFA).

Liz Shuler (President of the AFL-CIO since 8/5/21.)

Ironically, the first woman President of the AFL-CIO is also from Oregon. Liz Shuler received a bachelor’s degree in journalism from U of O in Eugene, Oregon. She became a union activist after college and worked to organize clerical workers at Portland General Electric. She is elected as the President of the AFL-CIO in 2021 after serving as the first woman Secretary-Treasurer of the organization.

Nolan’s book addresses State conflicts with unionizers and family-income for low-income workers. The first states he addresses are South Carolina and California. Nolan notes South Carolina has become a haven for businesses wishing to avoid unions. South Carolina’ State laws discourage unionization which appeals to businesses wishing to relocate. Nolan notes South Carolina attracts businesses looking to improve profits by reducing labor costs. The consequence of business’s lower labor cost is to reduce South Carolina workers’ standard of living. South Carolina’s workers are among the lowest (19th out of 50 States) paid workers in the U.S. Nolan implies South Carolina’s income inequality is a consequence of the State’s policy of discouraging unionization.

California has the fourth largest income inequality in the U.S.

Nolan notes the cascading negative of unfair compensation for domestic labor. Though California now allows childcare servers to be unionized, their unionization efforts are discouraged by government regulation, as well as the fragmentation of its poorly compensated workers. The consequence of State government regulation keeps wages low and discourages entrepreneurs from starting childcare’ businesses. A compounding negative is created when users of childcare’ service, women in particular, are unable to work in regular work-day jobs. Workers are compelled to stay home to take care of their children, reducing family income and further impoverishing low-income childcare’ workers. It becomes a vicious cycle, hurting entrepreneurs trying to start a childcare service, employees wishing to increase family income, and employers needing more workers.

Nolan expands his argument by noting how service industries in Las Vegas, the State of Florida, New Orleans, and Mississippi are benefited by unionization.

Vacation and gambling meccas like Las Vegas, Florida, New Orleans and Mississippi need service industry employees. These vacation and gambling meccas depend on service quality for visiting tourists. Lack of representation for service employees diminishes employee’ standards of living which indirectly damages the reputation of the entertainment and vacation industry.

In Las Vegas, where Nolan lived for twenty years, the service industry is protected by the Culinary Union.

Nolan notes how strong the Culinary Union has become in Las Vegas and disparages casino owners like the Fertitta’s who have fought unionization. Numerous examples are given to show how union actions have improved the lives of Casino workers, many of which are immigrants from other countries.

Nolan’s argument for the value of unionization is compelling but his encomium for the union movement ignores America’s immigration crises.

The vast need for immigration reform is not being forcefully addressed by unions. Compensation inequity is a noble fight carried out by unionization, but it needs to broaden its role in immigration. Unions need to use their power and influence to change immigration policies to equitably treat a labor force that is sorely needed in America. Unions need to help educate and house legal immigrants, so they do not become a part of America’s growing homelessness. Additionally, unions could use their recruiting expertise to get Americans off the street by providing job training services and gainful employment.

Public perception of unions could be monumentally improved with a program to recruit and indoctrinate the homeless with training for jobs in the 21st century.

There is so much that unions could do to far exceed the minimalist goal noted in Liz Shuler’s plan to add a million union members over the next 10 years. Nolan pitches for Sara Nelson as a more dynamic leader for the union movement. Maybe Nelson would be better than Shuler, but growth, value, and public perception of union members could be monumentally improved with a program to recruit and indoctrinate the homeless with training and jobs for the 21st century.

Whomever the leaders of unionization may be in the future, Nolan clearly illustrates how important political power is in balancing corporate owner/managers’ disproportionate incomes and privileges with labor.

OCCUPATION

“Apeirogon” is a little too repetitive for this reviewer, but it is cleverly written and shows why political and military occupation is a fool’s leadership style.

Books of Interest
 Website: chetyarbrough.blog

“Apeirogon” (A Novel)

By: Colum McCann

Narrated by: Colum McCann

Colum McCann (Author, Irish writer living in New York.)

At first the idea of an Irish author writing a book about Israel seems incongruous. After the first few paragraphs, one realizes Colum McCann grasps a truth about religious conflict that is far better than most because of Ireland’s “Troubles” between the 1960s and 1990s.

“Apeirogon” is timely novel in regard to Israel’s response to the October 7 Hamas attack in Gaza. A little history helps one understand the complexity and terrible consequence of the slaughter of innocents.

An estimated 30,228 people have been killed in Gaza, 12,000 of which are thought to be Hamas combatants.

Gaza dates back to Egyptian times, populated by Canaanites who share an ancestral connection to Israelites. Gaza later became part of the Assyrian Empire in 730 BC. Assyrians intermixed with Canaanites, Israelites, Philistines and undoubtedly Palestinians. History shows historical connection between ancient Assyrians and Palestinians just as there were with Israelites. However, Israelites were forcibly relocated to Assyria from the Kingdom of Israel. Because the Israelites were descendants of the Canaanites, they predated Palestinian settlement in Gaza. Ethnic precedent and the want of land area is a part of what complicates the idea of a separate Palestinian state. Where is a homeland for a Palestinian state going to come from?

McCann chose a perfect title for his novel. An apeirogon is a geometric shape that has an infinite number of sides; just like the many sides of Israeli/Palestinian arguments for a homeland. Column McCann cleverly explores these arguments in his novel. He creates a series of Israeli/Palestinian incidents that show how each ethnic culture believes and acts in their perceived self-interests. Every chapter is titled as a series of numbers that begin with the number 1, jumps from 500 to the number 1001; then jumps back to 500 and descends to number 1 to end his story. Revelation comes in 1001. Occupation is an evil that cannot stand.

America’s civil war carries some parallels to what is happening in Israel and Gaza.

What is revelatory about McCann’s novel is its similarities to America’s civil war that ended the lives of too many Americans. Today’s conflict in Gaza is instigated by Hamas just as the Civil War was instigated by southern slave holders. America eventually forgave southern slave holders, but Black Americans continue to suffer from institutional racism. Can a one state solution as demanded by Israel’s conservatives serve Palestinians any better than white America has served Black Americans? America’s civil war ended in 1865-1866, some 158 years later, Black Americans are still discriminated against. Can Palestinians wait more than 158 years to have equal rights in an Israeli nation?

McCann’s novel repeats, too many times, the unfairness of Israel’s occupation of Gaza. Hamas has its rebellious leaders like America had John Brown who killed one Marine, wounded another, and killed six civilians. Neither Brown nor the Hamas leaders can justify their murders though both argue with righteous conviction. The United States could have split between abolitionist and non-abolitionist states, or they could move toward reconciliation. Obviously, the U.S. government prevailed with reconciliation. It seems imperative for Israeli and Palestinian leaders to take the same road as Abraham Lincoln. Hamas is a splinter group like that led by America’s John Brown. Their objective is as horribly misguided as Brown’s. Hamas’s hostage taking and murder of Jewish settlers is as reprehensible as Brown’s murders of a Marine and six civilians.

ISRAEL’S OCCUPATION OF PALESTINE

As difficult as it may be, a two-state solution seems unlikely. What American history suggests is as difficult as America has found reconciliation to be for white America’s murder and unjust treatment of Black Americans. That reconciliation remains a work in progress. However, only union offers a way toward peace. America is not there yet but it is making progress.

Two political factions, bound by both religion and ethnicity, must learn to live with each other for peace to be achieved.

There is no other land for Palestinians. Israel may have the older of the two cultures, and both Israelites and Palestinians have a much longer history of religious and ethnic difference than America. America is founded on religious freedom and equality, though not perfect in either principle. In contrast, religion is a primary determinant in Palestinian and Israeli cultures while equality seems a less prominent concern. Peace will not come without hardship, but a beginning is dependent on Israel’s abandonment of occupation. It will be one country’s leaders’ imperative to provide equal opportunity for all its citizens. The struggle will be long as is shown by America’s history but what realistic alternative is there for the Israeli and Palestinian people? What neighboring country is likely to give up their land to create a two state solution?

“Apeirogon” is a little too repetitive for this reviewer, but it is cleverly written and shows why political and military occupation is a fool’s leadership style. Israel, like white America, needs to do better in reconciling ethnic differences.

CAPITALIST’ LESSONS

Capitalism is not a partisan issue but a social imperative for both Republicans and Democrats to work together to benefit all Americans.

Books of Interest
 Website: chetyarbrough.blog

“Capitalism in America” (A History)

By: Alan Greenspan, Adrian Wooldridge

Narrated by: Ray Porter

As one would expect, “Capitalism in America” begins with the British economist, Adam Smith, who defined capitalism in 1776 with “An inquiry into the Nature and Causes of the Wealth of Nations”.

Alan Greenspan (on the left) is an American economist who was chairman of the Federal Reserve from 1987-2006. Adrin Wooldridge (on the right) is a British economist and journalist who wrote for “The Economist”. Wooldridge has a doctorate in philosophy and has co-written several books with Richard Micklethwait, the editor-and-chief of Bloomberg News. One might argue Greenspan has a conservative bias but Wooldridge’s experience as a British journalist gives one a sense of balance in this informative and well-written history of American capitalism.

Smith’s concept of capitalism advocated leaving economic decisions to market forces, tempered by individual economic decision makers. What Greenspan and Wooldridge infer is that decision-makers’ discretion and interference are what roils capitalism’s history.

“Capitalism in America” reveals tumultuous times for the American economy but with positive forward momentum. The public in all countries have experienced hard times from market forces. Some countries, like Israel, India, and the U.K. have experimented with socialism as an alternative to capitalism. Communist countries like Russia and China flirt with capitalism and one may argue–benefited from its market results. The author’s history shows capitalism as the primary reason for America’s economic growth and success. However, that’s getting ahead of their story.

The authors begin at beginning with the story of Jefferson’s desire to emphasize agriculture as the primary driver of economic growth in America. In contrast, Alexander Hamilton believes the industrial revolution demands a broader view of economic policy. The key to tapping into the industrial revolution required capital which Hamilton clearly recognizes. Hamilton recommends the creation of a national bank. Hamilton is inspired by Great Britain’s Bank of England. It offered private capital and paper credit to businesses and entrepreneurs.

Hamilton, as Secretary of the Treasury, presented a “Report on a National Bank” to President Washinton and the House of representatives in 1790. This report notes that Congress, with its authority to collect taxes, could fund the bank and lend money to the government to pay foreign creditors, public services, and private businesses to grow the economy. Jefferson opposed the idea, but Hamilton’s broad interpretation of the Constitution allowed his idea of a national bank to be created. In 1791 the First Bank of the United States is established in Philadelphia and remained chartered for 20 years. This became a giant step for America’s economic growth.

Several future Presidents opposed an American national bank. Of course, Jefferson was one because of his belief in an agrarian future for America. Jefferson’s friend and future President, Madison (the 4th President of the U.S.) opposed the idea of a national bank, and Andrew Jackson (the 7th President of the U.S.) used his power as President to oppose the “Second Bank of the United States” in 1833.

The authors note the successful industrialists of the 19th century capitalized on Hamiltonian creation of an American banking system. They became known as the robber barons of America. Rockefeller, Vanderbilt, Carnegie, and J.P. Morgan used capital to produce oil, expand rail transportation, make steel, and provide bank capital to grow the economy.

And then, WWI drew America into events that roil the course of its economic history.

An American economic boom occurs in the first two years of the war with America choosing neutrality. Exports surged from $2.4 billion to $6.2 billion in 1917. Everything from cotton, to wheat, to automobiles, to food, to machines were exported during those years. After joining the war, 3 million Americans were mobilized. When the war was over, the world and the American economy faltered. Recession (1918-1921) hit the world after the war, though America showed it had become a major world power.

As America recovered from WWI, their prowess as a producer of goods and services led to the roaring 20s and a runaway stock market that eventually crashed at the beginning of the Great Depression (1929-1939).

The authors note President Roosevelt is a great salesman who provides relief to many Americans with government employment programs during the depression. However, the authors note Roosevelt’s inept management delays America’s recovery by instituting price controls that distort market forces. Overt price control is a recurring mistake of national economies. The authors are not saying that price control is a singular cause of America’s continuing economic crisis, but it makes market recovery more difficult and longer to achieve.

The authors explain reparations for WWI’s winners helped set the table for WWII.

Germany’s inability to pay reparations, the growth of Antisemitism, and German inflation led to the rise of Hitler. Though not addressed by the authors, Japan felt threatened by American, Chinese, and Russian influence in Asia that led to Pearl Harbor and America’s entry into WWII.

The point is made that America’s depression before the war is not cured by Roosevelt’s economic intervention. The advent of war mobilized American industry.

The authors suggest market interference delayed recovery from the Great Depression. On the other hand, Roosevelt gave hope to the country with his speeches and employment programs. Citizens underlying faith in America’s ability to overcome hardship, and their response to Pearl Harbor reinvigorated the economy. Industries were retooled to meet the demands of war.

The authors argue mistakes in America’s capitalist history have been made by both Democratic and Republican Presidents who interfered with naturally occurring market forces. From Roosevelt to Nixon to Reagan to Obama to Trump, Presidents who institute price controls and/or tariffs interfere with free trade. America’s capitalist economy suffers from those actions. This is not to argue all legislation and federal action on the economy constitutes capitalist interference. Fundamental human rights that ensure freedom to vote, speak one’s mind, practice one’s own religion, work in industries one chooses, while seeking peaceful resolution of differences, are interferences that sustain capitalism.

Freedom to compete is the hallmark of capitalism.

When natural market forces are interfered with by business leaders and public legislators, capitalism suffers. An inference one may draw from the authors is that legislated programs that aid Americans who are unable or unwilling to participate in the capitalist economy are an interference with capitalism. That raises legislated issues of emigration, social security, health insurance, education, defense, transportation, veteran’s benefits, housing, environmental protection, occupational safety, and other public benefit programs. This is where there is continuing disagreement among Americans. These are not party issues because both Republican and Democratic leaders have both positive and negative arguments for and against these policies.

There is the law of unintended consequences that plague government policies. Some argue Reagan reinvigorated the American capitalist economy by reducing taxes, cutting government programs, reducing government employment, and busting union strikes. He did those things and government debt skyrocketed to a level greater than ever in the history of America. The gap between rich and poor was set on a path that beggared the poor and enriched business managers without comparable enrichment of labor. Like Roosevelt, Reagan sold ideas that had unintended consequences that were not in the long-term interest of Americans.

How can one measure the success of capitalism versus other economic systems? The author’s history of capitalism offers no answer but reveals what has benefitted and damaged American society since 1776. They illustrate failure of capitalism is in the hands of American leaders. Capitalism’s improvement is not a partisan issue but a social imperative for both Republicans and Democrats to work together to benefit all Americans.

CAPITALISM’S DEATH?

Democratic capitalism is the most likely form of government to assuage our worry and find a rational solution for our right to privacy.

Books of Interest
 Website: chetyarbrough.blog

“TECHNO-FEUDALISM” (What Killed Capitalism)

By: Yanis Varoufakis

Narrated by: Yanis Varoufakis

Yanis Varoufakis (Author, Greek economist and politician, Minister of Finance of Greece for 7 months in 2015, launched Diem25, the “Democracy in Europe Movement 2025” in February 2016.)

Yanis Varoufakis’s “Techno-Feudalism” argues the advance of technology is killing capitalism. Varoufakis’s argument is that democratic capitalism is either dying or dead. He suggests a survival plan in the last chapter of his book. This misguided book reminds one of Mark Twain’s response to news of his illness, i.e., “The reports of my death are greatly exaggerated”.

Varoufakis argues the advance of technology and its intrusion into private lives of citizens will destroy freedom of the individual and result in a government ruled by authoritarian, undemocratic, feudal oligarchs.

Varoufakis infers technology is the cause of the rise of new robber barons that have struck it rich in the internet era. He largely disparages the great wealth accumulation by the founders of Amazon, Google, Microsoft, Apple, and other tech leaders in the 21st century. His argument is based on belief that these new robber barons became rich without the hard work of laborers like those during the industrial revolution. The error in his argument is that labor is adjusting from work with one’s hands to work with one’s mind.

Freedom is the keystone of democracy.

Freedom and democracy have been limited and abused over the centuries but have ultimately led to the wealthiest countries in the world. When freedom is overregulated by democratic leadership, economic progress is diminished. Democracy has historically mitigated mistakes of overregulation with human nature’s desire for freedom. There is no reason to believe human nature will change.

In one sense, Varoufakis’s argument is correct. There is a greater risk of loss of freedom with the advance of technology, i.e., particularly with the rise of artificial intelligence. The evidence of that risk is seen in China and North Korea’s surveillance capabilities today.

Authoritarian leadership has always been a risk to society.

As inferred by Varoufakis, authoritarian risk is greater in the 21st century because of surveillance technology and the predictive power of artificial intelligence. Surveillance does not change the nature of humankind. Democratic government only becomes more important. The juggernaut of technology will not be stopped, and our lives will be more intimately understood by strangers than ever before. That truth only means democracy, freedom of choice, and equal opportunity are made more consciously recognized as important.

The fact that the 21st century has new robber barons, business leaders with great wealth and power, is nothing new.

All forms of government have winners and losers. What democracy does is level the playing field. It is a raucous governing system that leaves some out of success, but it beats any known alternative for broader human opportunity. Democracy will always be a work in progress. America needs better health care for all citizens. America needs improvement in equal rights and opportunity for all citizens. No Americans should be homeless or hungry. Few countries, if any, have adequate health care, equal rights, and opportunities for all its citizens. Most realize, America must do better.

The resurgence of labor unions in America is a good sign for American peace and prosperity.

Varoufakis suggests democracy can be saved by bringing it down to an individual level within companies that generate wealth for the country. In one sense, he is right but his idea of giving one vote to every employee in determining wages, and the direction of a company are a step too far. Labor is a critical part of yesterday’s, today’s, and tomorrow’s economic prosperity. Owners and managers of companies need to include union representation in their corporate decisions. Neither labor nor management have all the answers, but all have money, commitment, and labor in the game. Each should have their say. That is a part of Democracy’s success in the world.

The intimate knowledge of personal behavior is a valid concern in the modern world. In the hands of authoritarians, the risks of surveillance technology are multiplied. In democracy, risks are not eliminated but can be judiciously regulated. Democracy has the best chance of determining how a surveillance economy needs to be handled. Democracy will continue to make mistakes, but historically, its successes outweigh its failures.

Citizens should worry about what others know about their personal lives, but the advance of technology will not be stopped. Democratic capitalism is the most likely form of government to assuage our worry and find a rational solution for our right to privacy. Varoufakis’s “Techno-Feudalism” is more wrong than right, but he makes one think about our future.

AMERICAN PRESIDENTS

“Confront and Conceal” is a depressing examination of the American Presidency.

Books of Interest
 Website: chetyarbrough.blog

“Confront and Conceal“

By: David Sanger

David Sanger (Author, American journalist for the New York Times, Harvard graduate. Co-winner of 3 Pulitzer Prizes.)

David Sanger offers a journalist eye view of the first four years of the Obama Administration in “Confront and Conceal”. The most impactful impression a reader gets of a U.S. presidential office is that it is a difficult and complex job. Sanger’s observations imply the best a voter can hope for in electing a President is that he/she is a good student of the politics of life and government. Sanger shows Obama has the skill of both while the President who follows only understands the first and cares nothing about the second. This is not to suggest Sanger shows Obama as a perfect President but that his skill in governing far exceeds his successor.

Obama eschewed American intervention in foreign governments but inherited American presence in Iraq and Afghanistan.

At the same time, the American economy was in free fall. A mortgage crisis was born from the greed of human nature. The cure for the mortgage crisis is initiated by the Bush administration. However, like many Presidents before, American foreign government intervention plagues Obama throughout his tenure.

The horrible consequence and resolution of the mortgage crises fell largely on the poor in America.

The rich generally escaped its devastating impact because they had the resources to cash out debts carrying rising interest rates. An estimated 861,664 families lost their homes to foreclosure. The lending institution’ managers who approved loans to the poor on false pretenses were largely forgiven for their greed. Obama’s administration succeeded in stabilizing the American economy, but the fairness of the process is grossly inequitable.

With the exception of the first Bush’s invasion of Iraq, American military intervention in foreign governments has been a failure in every circumstance since WWII.

One might argue this is less true in the case of Korea but the continued belligerence of North Korea and foreign relations conflicts with China and Russia are a direct result of past American military interventions. Obama attempts to improve relations with China but is unsuccessful. Sanger shows that lack of success is because of suspicion of America’s past history and because of a belief that Obama is simply trying to isolate China’s influence in the world. Russia’s invasion of Ukraine speaks for itself. It will ultimately fail but at the consequence of many lost Russian and Ukrainian lives.

“Confront and Conceal” is no pean to the Obama administration. It is a revealing examination of a well-educated and prudent President who wishes to do what is best for America but is trapped by history and human nature.

Obama, like all 21st century Presidents, has the power to kill individual human beings by remote control and direct covert actions that can and do have unintended consequences. Obama is the first President to wheel the power of drone death to eliminate enemy combatants. Even though Obama martials western powers to participate in the overthrow of the Libyan government, Quaddaffi is not given a trial but murdered by rebel Libyan forces. Libya remains a failed government in search of stability. The idea of an incompetent and revengeful elected President of the United States with the power of drone murder is frightening.

“Confront and Conceal” is a depressing examination of the American Presidency because it shows a decent and intelligent President is only slightly better than an incompetent, dishonest, and poorly educated human being like Donald Trump. President Obama’s biggest contribution to America is in providing better health care for the poor but even that is being challenged by his successors.

WHO’S LAUGHING

Appelbaum infers no American President has found the magic formula for balancing the needs of its citizens with the concept of Adam Smith’s free enterprise.

Books of Interest
 Website: chetyarbrough.blog

“The Economists’ Hour: False Prophets, Free Markets, and the Fracture of Society“

By: Binyamin Appelbaum

Narrated by: Dan Bittner

Binyamin Appelbaum (Author, winner of a George Polk Award and a finalist for the 2008 Pulitzer Prize, lead writer on economics and business for The New York Times Editorial Board)

Binyamin Appelbaum has written an interesting summary of a difficult but immensely important subject. Economic policy and theory are boring, but they touch every aspect of life. Appelbaum shows economic policy magnifies or diminishes the welfare of every American, let alone every economy in the world.

Adam Smith’s foundational theory of economics.

Though only briefly mentioned by Appelbaum, American economic policy begins with Adam Smith (1723-1790), the Scottish philosopher who wrote “The Wealth of Nations”. Smith advocated free trade and argued against parochial maximization of exports and imports that is manipulated by strict governmental regulation meant only to accumulate gold and silver.

JOHN MAYNARD KEYNES (1883-1946, CONSIDERED FOR NOBEL 3 TIMES FOR DIPLOMACY BUT NEVER AWARDED.)
MILTON FRIEDMAN (1912-2006, 1976 NOBEL PRIZE FOR ECOOMIC SCIENCES.)

Appelbaum illustrates how American policy violated the entrepreneurial freedom that Adam Smith advocated. In contrast to Smith, John Maynard Keynes (1883-1946) advocates government intervention whenever there is an economic downturn. Equally interventionist is Milton Freidman’s (1912-2006) belief that government should increase or decrease the money supply for national economic stability. The point seems to be that every economist thinks they have a magic bullet that will cure the ills of a faltering economy.

To be fair, Friedman did believe in free enterprise in regard to nation-state currencies. He argued for a floating currency rate that ultimately led to President Nixon’s abandonment of the gold standard. However, the nature of human beings led to speculation and manipulation of nation-state’ currencies that exacerbated trade tariffs and defeated the policy’s free-enterprise objective.

FRANKLIN ROOSEVELT (32ND PRESIDENT OF THE UNITED STATES, INTHE DEPRESSION, BANKS FAILED, UNEMPLOYMENT AND POVERTY SKYROCKEDTED.
GEORGE W. BUSH (43RD PRESIDENT OF THE U.S. 3 MILLION JOBS LOST IN THE 2001 RECESSION)

One concludes from “The Economists’ Hour…”, there is no magic solution for an economy in crises. Neither Franklin Roosevelt, George W. Bush, Barack Obama, or any American President cured what ails an American economy that succumbs to economic crises. Adam Smith would argue an economic crisis is caused by a governments’ interference with free enterprise.

Applebaum explains how every 20th and 21st century President of the United States placed their faith in economists’ economic assessments of their day. All Presidents have found intervention by the government has unintended consequences.

President Nixon adopted Freidman’s monetary policy by imposing a freeze on prices and wages that squeezed the life out of the business economy and beggared the wage-earning public with job loss.

A decade of stagflation (high inflation and slow growth) followed Nixon’s administration. Stagflation is attacked by the Reagan administration with mixed results. A myth from economists like Arthur Laffer grew in 1974. Laffer believes taxation is either too high or too low for any benefit to society. Laffer argued zero tax and maximum taxation are equally harmful and produce economic stagnation and/or collapse.

ARTHUR LAFFER (American economist and author, served on President Reagan’s Economic Policy Advisory Board 1981-1989, Here illustrating the “Laffer Curve”.)

Laffer argued every government that reduces tax revenue decreases the stimulative effect of government spending. On the other hand, he suggested every tax cut increases income for taxpayers that will stimulate business and increase employment while encouraging higher production. He laughably created the “Laffer curve” to imply there is an optimum balance of tax reduction that would stimulate economic growth with proportionate increases in government revenue to provide for better government services. That balance has never been found. President Ronald Reagan experimented with Laffer’s idea, but it fails from unintended consequences. The principal consequence is to increase the gap between rich and poor.

BENEFIT OF TAX REDUCTION

Reagan accelerated a movement for government tax reduction that ultimately reduced income taxes from 70% to 28%. The result of government tax reduction during the Reagan years increased the U.S. budget deficit from $78.9 billion to $1.412 trillion. The benefit of that tax reduction went to the wealthy while school lunches were cut, subsidized housing declined by 8%, and poor families lost $64 a month in welfare payments. In 2023, the budget deficit stood at $1.70 trillion, an imbalance that shows why the “Laffer curve” is sardonically laughable.

President Reagan’s administration (1981-1989) was influenced by Laffer’s curve.

The joke is “There is no perfect balance on the curve because of the nature of human beings.”

Roosevelt, George W. Bush, and Obama choose to follow Keynesian policy. Roosevelt bloated government employment. All three increased the government deficit.

Some suggest the idea of
“Cost benefit analysis” (CBA) is recommended to the federal government by two law professors, Michael Livermore and Richard Revesz during the George H. Bush administration but Reagan initiated it with an Executive Order in 1981.

Appelbaum notes that “cost benefit analysis” for government is first used during the administration of Ronald Reagan. However, Bill Clinton reifies its use with an Executive Order in 1993 that required covered agencies to do a CBA on “economically significant” government regulations. Ironically, Clinton was the first President in the post 19th century to balance the budget. Andrew Jackson manages to do it in his term between 1829 and 1837.

An irony of using “cost benefit analysis” is that it required a determination of of a human life’s value. Presidents Nixon, Ford, Carter, and future Presidents use value per statistical life during their administrations. High-income earners were worth $10 million to $15 million, middle-income earners $1 million to $2 million, and low-income earners $100,00 to $200,000. Of course, these values were always litigable. The point is that CBA became a tool for government to regulate the costs of government policies, ranging from military expense to the health, safety, and welfare of American citizens.

The remainder of Appelbaum’s book reflects on the experience of America, Chile, and Taiwan in the 20th century. The implication of his review of economic policy is that those countries that align with the free enterprise beliefs of Adam Smith have made mistakes. However, America’s, Chile’s, and Taiwan’s economic policies seem to have had more economic success when following Smith’s beliefs.

No American President has found the magic formula for balancing the needs of its citizens with the concept of Adam Smith’s free enterprise.

Along with CBA, Appelbaum notes the ongoing controversy is about regulation by government when it tries to balance American health, education, and welfare with Adam Smith’s concept of free enterprise. Appelbaum infers no American President has found the magic formula for balancing the needs of its citizens with the concept of Adam Smith’s free enterprise.

RICH AND POOR

Contrary to Leonhardt’s optimism, whether the American power structure continues to shift toward a more equitable treatment of the poor remains to be seen.

Blog: awalkingdelight

Books of Interest
 Website: chetyarbrough.blog

“Ours Was the Shining Future”

By: David Leonhardt

Narrated by: Dan John Miller

David Leonhardt (Author, journalist and columnist, writes “The Morning” newsletter for the “New York Times”, received a BS from Yale in applied mathematics in 1994.)

David Leonhardt writes an encomium to Democratic Capitalism in “Ours Was the Shining Future”. Some of what Leonhardt writes will make conservative Americans gag while liberals will tend to praise his view of American history. The hot button issues of 21st century America are immigration and the rising gap between rich and poor.

“Dallas, Texas, United States – May 1, 2010 a large group of demonstrators carry banners and wave flags during a pro-immigration march on May Day.”

Leonhardt’s selected historical facts argue that immigration has a cost to America that is mitigated by its contribution to the economy by second and later generation immigrants. He resurrects John F. Kennedy’s oft quoted phase about America as “A Nation of Immigrants”. Leonhardt argues the rising gap between rich and poor accelerated with the election of Ronald Reagan and subsequent tax and spend decisions made by later government administrations.

The difficulty one may have with Leonhardt’s reporting is that historical facts do not speak for themselves.

It is the power of Leonhardt’s persuasion rather than the facts of history (and one’s own prejudices) that make a credible argument for

(1) the benefit of unionization in America,

(2) the benefit of intervention by the Franklin Roosevelt administration during the depression,

(3) the aggressive tax reduction for high income earners with government overspending (beginning with Ronald Reagan) that negatively affected the American economy and disproportionately increased the gap between the rich and poor, and

(4) the monumental economic benefits from second generation immigrants like Sundar Pichai (CEO of Google), Indra Nooyi (former CEO of PepsiCo), Elaine Chao (the U.S. Secretary of Transportation under Trump), and Lin-Manuel Miranda (the creator of the Broadway musicals “Hamilton” and “In the Heights”), and others.

Leonhardt recounts the history of the union movement in America that evolved into a political power that improved the income and lives of the working poor.

He touches on the corruption of the union movement but on balance suggests more good than bad came from its representation of labor. Leonhardt argues the decline of unionization and tax policy changes in the late 20th century increased the gap between rich and poor.

Leonhardt argues immigration needs reform and infers it should begin with acceptance of an estimated 340,000 children (dreamers) born in the U.S. to unauthorized immigrants.

He suggests new immigration should be limited to immediate relatives of legal immigrants that presently live in the U.S. He reiterates the value of second-generation immigrants while acknowledging the burden borne by the economy with first generation immigrants. New immigrants generally have a language deficiency, greater education needs, and a willingness to work at jobs for lower pay than non-immigrant workers who also need jobs.

Leonhardt suggests the gap between rich and poor is a function of an unequal distribution of political power.

Leonhard believes improvement is coming from a resurgent union movement and an evolving recognition by both conservatives and liberals of the consequence of inequitable tax treatment that favors the rich.

There is some evidence to support Leonhardt’s belief in a power shift with the recent union actions in automobile, teacher. and nursing services strikes that increased their income. Minimum wages have risen in 22 states that have affected an estimated 10 million workers. The highest are in California ($16), Massachusetts ($15.75), and Washington ($15.50).

However, one is inclined to be skeptical about income gap reduction with Trump’s Presidency that further reduced taxes on the rich and Biden’s reluctance to act on tax inequality.

Leonhardt receives a Pulitzer Prize for Commentary, the Gerald Loeb Award for excellence in reporting on business, finance, and the economy, a New York Time Book Review Editors’ Choice award, and The Atlantic’s Ten Best Books of the Year for the most notable and influential book of the year. These are nice academic rewards but whether Leonhardt’s arguments are anything more than a finger in a dike, near a breaking point, is yet to be revealed.

Contrary to Leonhardt’s optimism, whether the American power structure continues to shift toward a more equitable treatment of the poor remains to be seen. The continued popularity of Trump among conservatives is disheartening and suggests otherwise.

STONE THROWER

In the 21st century, actions and policies of one nation are not local. Like a ripple in water, the world can be changed by one stone thrower.

Blog: awalkingdelight
 Website: chetyarbrough.blog

Crashed: How a Decade of Financial Crises Changed the World

By: Adam Tooze

Narrated by: Simon Vance, Adam Tooze

Adam Tooze (British Author, Historian, professor at Columbia University, Director of the European Institute.)

“Crashed” is a book about the 2008 financial crash. Though it is old news, Adam Tooze offers historical perspective and a cautionary tale about America, the E.U., China, India, Russia, Spain, and other nations of the world. Interconnectedness is greater now than any time in history. The surprising realization in Tooze’s analysis of the financial crash is that America caught a fiscal infection like Covid19, and it spread across the world.

To increase return on investment in 2008, American security firms created and sold a financial product with a blend of good and poorly secured mortgages.

These securities were purchased and re-sold among big banks, wealthy investors, and investment houses. The lax oversight of the quality of the combined mortgages led to a cascade of bank and investment house failures that nearly collapsed the world financial system.

Though the western world was more directly affected by purchases of these mortgage packages, countries like China, Russia, South Korea, Ireland, Spain, and Greece were severely, if not equally, impacted.

Nations’ financial crises were not solely because of purchases of these mortgage packages but because of world economic interconnectedness. Nations of the world, as users of energy and product purchases, quit buying. At the same time, Tooze notes the American dollar was hoarded by some countries for protection from devaluation of local currencies. With America’s financial crises, the dollar became a source of devaluation rather than protection.

China escaped most of the 2008 financial crises because of its committed investment in national growth.

China chose to invest in domestic infrastructure projects like dams, high speed rail, and bridges. China chose to increase product production (at lower labor costs) for the worldwide market. In contrast, Russia reinforced kleptocracy, before, during, and after the 2008 crisis, by rewarding Russian oligarchs who became a wealthy and powerful cadre of supporters of the government. With favored treatment of the oligarchs, Vladimir Putin recognized he had the power to act as he wished whether it was in the best interest of Russian citizens or not. (This is similar to the repressive reign of Kim Jon-un who spreads the wealth of his nation on a relatively small cadre of North Korean protectors while many citizens live in poverty.)

Ben Bernanke (American economist, 14th chairman of the Federal Reserve.)

In America, Tooze deconstructed the complicated negotiation process between banking industry independence and federal government oversite by the Obama administration. The range of disagreement is from nationalization of the banking industry to a direct bailout of overextended banks. Though the government bluntly accused banking executives of overpaying themselves for the mistakes they made, Obama and Geitner recognized the importance of industry independence in making complicated decisions to get America out of its financial ditch. The decision is made to bailout the banks. The American government loaned enough money to banks and select companies to maintain American lenders’ and industries’ liquidity.

Timothy Geithner (Former central banker, 75th U.S Secretary of the Treasury under President Obama.)

The controversial decision made by the government to support banking and industry liquidity resulted in many American citizens loss of their homes; not to mention their jobs, because of business and industry cutbacks. The tranches of money to support lenders and businesses did nothing to help the poor who purchased houses on variable rate mortgages to qualify for a loan. Mortgage lenders received large bonuses for increased business but were never penalized for the harm they did to the public. When rates on their loans escalated, lower income buyers could no longer pay their mortgages. The choices of Obama’s administration reinforced the perception that those with enough money to cope with the economic downturn were favored over the poor because they had enough income to either pay the escalated mortgage payments or refinance their mortgages.

The financial rescue of Greece follows a similar path between 2008 and 2018. Greece is eventually bailed out but the citizens most hurt by the restructured financing are the poor.

In order to stabilize the economy, 320 billion euros were lent to Greece by the European Union and the IMF. As of 2019, only 41.6 billion had been paid back to reduce that debt. The E.U. and IMF imposed austerity measures that principally hurt the poor by reducing retirement pensions and employment opportunities. Greece fell into a recession that lasted until 2017. The poor became poorer because of pension reductions and loss of jobs. (Full repayment of the 320-billion-dollar loan is not expected until 2060.)

Tooze tells a similar story about Spain. The 2008 crises caused a 3.6% reduction in GDP in 2009. Spain’s response was similar to Greece’s in that the poor were more likely to have been hurt than the rich because of implemented austerity measures that reduced public spending, and job creation that impoverished a wide swarth of society.

The final chapters of Tooze’s history severely criticizes the rise of Trump and his extremist rhetoric about helping the working poor when in fact he is only interested in himself, his power, and his wealth. Tooze implies Trump uses American belief in free speech, and the power of public office to distort the truth of immigration, poverty, and equality to mislead the public. Historically, this is not a new American phenomenon but in this technological age, the damage political leaders can inflict on the public is multiplied.

In explaining the impact of the 2008 financial crises, Tooze shows how one nation’s actions and policies can roil the world. In the 21st century, actions and policies of one nation are not local. Like a ripple in water, the world can be changed by one stone thrower.

PRICE OF FREEDOM

Mandela’s biography and today’s conflict between Hamas and Israel makes one ask oneself–Is a tenuous and ephemeral peace worth the death of innocents?

Audio-book Review
By Chet Yarbrough

Blog: awalkingdelight
 Website: chetyarbrough.blog

Long Walk to Freedom

By: Nelson Mandela

Narrated by: Michael Boatman

Nelson Mandela, (1918-2013, Died at age 95, South African anti-apartheid activist and politician, President of South Africa 1994-1999)

Nelson Mandela’s autobiography details the life of a remarkable and important leader of South Africa’s revolt against apartheid. Mandela began as a pacifist resister of white repression. However, his autobiography shows a change in belief from passive resistance to violence. (Mandela’s evolution from pacifist to belief in violence for social change is a reminder of the evolution of Malcolm X , the rise of the Black Panthers in America, and the Hamas and Israeli conflict in Palestine and Israel.)

Factions of the world today, like Mandela’s thought and action in the mid-20th century, believe in the utility of violence and terror for social change. The state of Israel, the territory of Gaza, and many countries of the world, like India, Lebanon, Iran, Hong Kong, Sudan, Libya, America, and others have political factions that believe they can change their societies with violence and terror. The conundrum of violence and terror is whether they proffer social gain or loss. The truth of gain or loss from violence and terror is being tested by the Hamas faction of Palestine and the conservative followers of Netanyahu in Israel.

The likelihood of a young African boy raised in a small village becoming President of South Africa beggars the imagination.

Mandela’s autobiography explains how it happened. There are 11 officially recognized tribes in South Africa. Mandela was born into the Thembu royal family, a subgroup of the Xhosa people. He explains his father, though not literate or formally educated, is a leader in his village. Mandela notes that his father had four wives and travelled between villages to spend time with each wife. When his father was away, his birth mother took care of him, but his father, as well as his mother, seem to have had great influence on his life. Mandela tells of walks with his father and the conversations his father has with other village members that mold Mandela’s beliefs and ambition in life.

Mandela notes his mother guides him to an important change in his life. When his father dies, his mother moves to a bigger village where he comes under the care of a regent of the Thembu tribe.

Mandela is effectively adopted into the royal Thembu family and moves into their palace. His ambition seems stimulated by that association and inspires him to become a formally educated South African.

Mandela receives a BA degree from Fort Hare in Alice, South Africa in 1943. He studied law at the University of Witwatersrand in Johannesburg. At that time, Mandela did not receive a law degree but was able to practice law because of a two-year diploma in law as an add-on to his BA. (When imprisoned, he studies, passes his University of South Africa’ law classes, and receives an LLB in 1989.) Mandela chooses to use his two-year diploma in law to become an advocate for Black liberation in South Africa. After graduation and his beginning practice of law, he is counseled by some to abandon politics to avoid arrest and intimidation by the government. However, Mandela chooses to join the African National Congress (ANC) in 1943. He becomes the co-founder of the youth league of ANC in 1944.

FORT HARE COLLEGE
UNIVERSITY OF WITWATERSRAND

In his early ANC years, Mandela emphasized passive resistance like that practiced by Mahatma Gandhi in India. ANC had been formed in 1912 as a South African native congress but grew to become a multi-racial organization including all races and ethnic groups in South Africa. Mandela notes that the communist party was interested in being part of ANC’s role in liberating South Africans from apartheid. Mandela expresses reservation about the CPSA (the Communist Party of South Africa) but acknowledges its help in raising funds for an ANC army that was to be organized by Mandela as a militant resistance force to overcome apartheid. CPSA influence and ANC association became a part of the movement.

As a politician, Mandela had no experience in armed resistance. It is interesting that he is chosen to form the first ANC terrorist cell.

Mandela grows to believe political recognition requires violent resistance but also a personal ability to persuade others to join the ANC’ movement either financially or physically. Mandela is trained in Ethiopia by Col Fekadu Wakene on how to plant explosives and manage a volunteer army.

Col Fekadu Wakene taught South African political activist Nelson Mandela the tricks of guerrilla warfare – including how to plant explosives before slipping quietly away into the night. (BBC Africa by Penny Dale)

Ironically, Mandela is arrested in 1961 after only one action by his gathered volunteer army in December 1961. Whether the action is at the order of Mandela is not revealed but the resistance blows up an electricity sub-station. Mandela is arrested and serves 27+ years in prison for organizing the volunteer army which became known as Umkhonto we Sizwe (Spear of the Nation). Three years of trial led to a guilty verdict.

Mandela was arrested and charged with high treason along with his collaborators. The Rivonia Trial turned Mandela into a symbol of the struggle against apartheid.

The last chapters of Mandela’s autobiography is about his incarceration on Robben Island and Pollsmoor Prison and the conditions of his imprisonment. While in prison, Mandela continues his education to become a licensed attorney.

In the first two years at Robben Island, Mandela and his co-conspirators are restricted to their cells. Methodist religious services were eventually allowed but sermonizing about reconciliation offended Mandela and his fellow prisoners. Though much of what some ministers preached were offensive to the imprisoned, Mandela approves of one minister who looks at his religion through the lens of science as well as faith.

ROBBEN ISLAND
POLLSMOOR PRISON

Mandela and his co-conspirators remain at Robben Island for 18 years before being transferred to Pollsmoor Prison in Cape Town. This is a significant improvement in their incarceration because of cell accommodations and food quality. However, his co-conspirators are separated from Mandela. Mandela is released in 1990, over 29 years after arrest.

Mandela explains a door is opened to the government of South Africa by Kobie Coetsee (1931-2000, died at age 69), the South African minister of justice and prisons.

In 1985, Botha was President of South Africa. Botha offered release to Mandela if he would unconditionally renounce violence against the government. Mandela refused and Botha denied Mandela’s release.

When F. W. de-Klerk became President of South Africa, after being Minister of National Education, a possibility for Mandela’s release was reopened.

Later, Mandela negotiated with de-Klerk to have his co-conspirators released from Robben Island and Pollsmoor. Further, Mandela negotiated with de-Klerk to have South Africa’s apartheid policies eliminated. President de-Klerk agreed, and Mandela was released in 1990. Both de-Klerk and Mandela receive the Nobel Peace prize for their negotiated peace agreement.

The last three-hour section of Mandela’s autobiography is about freedom and Mandela’s election as President of South Africa. The price of peace is high because violence seems a requirement for good-faith negotiation between opposing parties. Mandela’s biography and today’s conflict between Hamas and Israel makes one ask oneself–Is a tenuous and ephemeral peace worth the death of innocents?

(There is a brief interview with the author who aided Mandela in completion of his autobiography. It took two years of interviews and research to complete Mandela’s story.)

PRIVATE INFORMATION

The flaws of society are only magnified by the surreptitious use of private information. McCarten shows human self-interest is unlikely to change in a surveillance driven society. As long as human self-interest revolves around money, power, and prestige, private information should be protected.

Audio-book Review
 By Chet Yarbrough

Blog: awalkingdelight
 Website: chetyarbrough.blog

Going Zero: A Novel

By: Anthony McCarten

Narrated by: Marin Ireland

Anthony McCarten (Author, New Zealand writer and filmmaker.)

Anthony McCarten creates a fictional story that fits today’s truth about a brave new world revealed by Aldous Huxley in 1932 and reinforced by George Orwell in 1949. https://chetyarbrough.blog/2019/09/08/2-2-makes-5/ The striking revelation and threat in “Going Zero” is that our human desire for recognition drives society to accept the intrusion of government and big business into our lives. The popularity of the former company Twitter, today’s Reddit, internet users, and ubiquitous mobile phone’ users show how addictive recognition has become to the young and old. That need for recognition conflicts with the right to privacy. McCarten shows how important and harmful right to privacy’s loss can become.

McCarten offers a clever story that reveals the danger of unrestricted access to citizen’ information. A highly profitable private tech company offers $3,000,000 to any one of ten pre-selected contestants that can be undetected by a software company’s private surveillance program. A private tech company gains the cooperation of the federal government to use their data base and surveillance technology to help find these ten contestants within a 30-day period. The tech company’s software can mine government’ data and use government’ surveillance equipment to track private citizens. The program is called “Going Zero”. The purported reason for cooperation of the government is to protect citizens from society’s bad actors. The tech company’s interest is in getting a muti-billion-dollar contract for their proprietary software.

Added to McCarten’s fine story is the mystery of a disappeared but unacknowledged agent of the C.I.A. The one person that successfully beats the “Going Zero” contest is the agent’s wife. She only enters the contest to expose the government’s information about her husband.

Both government and business believe they use personal information to serve the public. Government and big business subtlety influence society to believe private information is public information. Government argues knowledge of private information protects society. Big business argues collection and use of private information offers material, social, and/or psychological rewards to the public.

Capitalism is not the problem in America.  It is the failure of the S.E.C., the FBI, C.I.A., the President, and congressional legislators to do their job. 

A contrary argument is that government and big business would be able to program society by using private information to reward citizens like Palov’s dogs. The questions one may ask oneself: Can bad actors really be identified before they rob, steal, rape, and murder? What are the ramifications of a business that uses private information to tap into subliminal desires of the public? “Going Zero” offers an example of how private information collected by government and big business are a threat to society.

Anthony McCarten’s story shows how important it is to protect personal privacy.

The flaws of society are only magnified by the surreptitious use of private information. McCarten shows human self-interest is unlikely to change in a surveillance driven society. As long as human self-interest revolves around money, power, and prestige, private information should be protected. If there is a counter argument, I would like to hear it.