The Politics of Voter ID

Yesterday the Texas House began hearings on a bill, already passed in the Senate (SB14), that would require voters to present a valid photo ID at the polls.  This legislation would courageously solve a problem that by all rational accounts does not exist.  Along the way some Democrats have expressed concern that it will effectively suppress voting in communities they depend on for turnout.

In reality this proposal is unlikely to have any meaningful affect at all.  So is it worth all the noise?

I’ll confess right off the top that the first time I showed up to vote, young, bright-faced, ignorant, and eager, I had my drivers’ license out ready to show.  I was surprised and a little alarmed that no one wanted to see it.  As time has passed (so much time…) the ability to conduct any of life’s business without an ID has steadily narrowed.

You can’t buy Sudafed anymore without showing your drivers’ license.  Valid ID has evolved into a de facto qualification to participate in the economy.  Perhaps there really is, as some Democrats have suggested, a block of people out there who find obtaining a valid ID a tremendous challenge.  Maybe, just maybe, determining who will lead the free world is not the first project those folks should tackle.

Results from other states suggest that Voter ID will make only a very marginal difference in voter turnout.  There may be people who do not vote either because they are turned away or are intimidated by the requirement.  Is it worth creating this nuisance to solve a fictional problem?

What’s more, those who actually buy into the fantasy that this kind of fraud is influencing elections are in for a fat surprise.  Those hoards of Mexicans who are fraudulently casting votes (for Democrats, of course) by assuming someone else’s identity are, well, let’s just say ‘elusive.’  And the underprivileged folks who Democrats are kvetching about can meet the ID requirements.  It’s not an impressive hurdle.

The group that combines the highest current turnout with the greatest likelihood of being affected is our grandmothers.  They have evolved into a pretty reliable Republican bloc.  If Voter ID has any partisan impact at all, it could bring some surprises.

The greatest impact of Voter ID might be its devastating emotional cost to the far right.  Voter fraud is one of the  favorite complaints of the tin hat brigades at both political extremes.  It’s unfair to rip that warm, cuddly straw-man from our own weirdoes,  leaving them one-down against their enemies on the opposite fringe (who will still have voting machines to blame).

So why do we need Voter ID?  Because we’ve spent so much energy over the years hyping fraud as a factor in elections.  Most of those on the right who think it’s going to make much difference also think Glenn Beck is the only person who tells them the truth.  That’s why it hasn’t been seriously pursued in the past.  But now that we are solidly in charge there is no easy way to shirk this rhetorical obligation.

You will almost certainly need a valid ID to vote in your next election and not much will change.  The Tea Party will once again send people to the Third Ward to watch over the black folk (to protect their rights).  And once again they’ll find nothing more than the trouble they caused.   I predict somehow we will continue to hear about this problem.

Finding voter fraud up to now has required a lot of creativity and this law does nothing to limit imagination.

The whole effort is a waste of time, but a relatively harmless waste of time.  Given the profile of this new Legislature, we should probably all be grateful they are investing their spare energy on this issue, instead of working on something where they could do some real harm.

My Favorite Republican

We have much still to learn from the lost hero of the modern Republican Party.  He represented the best hope for the post-Cold War GOP.  He gave us an opportunity to build the Party’s center-right posture into a post-racial juggernaut that could have dominated our politics for a generation.  Intelligent, charismatic, and seemingly incapable of cynicism even when it would have served him, he didn’t know how to play to fear.  He didn’t know how to ride a mob.  And he lost, but I refuse to say that he failed because if the Party is ever going to recover any sort of broad credibility, we will do it by recasting ourselves in his mold.

My favorite Republican is Jack Kemp.

Kemp was an urban Republican from the Northeast, a combination of adjectives that in our time sounds like a punch-line.   A former football star and a Congressman from New York, he was the last great Hamiltonian of the modern era.

A brutal optimist, he carried an infectious faith in the power of freedom to foster prosperity.  As the author of Reagan’s 1981 tax cut (the Kemp-Roth Act) he was one of Reagan’s most reliable allies in Congress.  But Kemp was not a prisoner of anyone’s dogma.  He applied serious thought to a class of difficult problems that we don’t normally associate with Republicans.

Kemp actually wanted the position of Secretary of Housing and Urban Development.  Think about that for a second.  Normally a throw-away position in a Republican Administration, he served in that role under Bush Senior and made it a platform.  He relentlessly pressed to shift ownership and decision-making from Washington bureaucrats to the recipients of aid.

He fostered the trend away from failed housing projects toward ownership and voucher-based programs.  He brought new emphasis to education issues and helped craft tax increment financing programs to attract new development to run-down areas.  He brought passion, intelligence, and humanity to conservatives’ policies on race and poverty.

The legacy of his efforts can be seen right here in Chicago where the wasteland that once was Cabrini Green is a now evolving into an attractive mixed income private housing development.  In Houston the long-awaited elimination of the miserable Allen Parkway project was inspired by his model.  Former no-go areas of central cities all over the country have become showplaces in his wake.

At a time when hyper-partisanship was just beginning to rear its head, Kemp was always comfortable in a difficult crowd.  He fostered strong relationships all over the spectrum; his friendship with Henry Cisneros being a prime example.  Though there are areas in which I disagree with Kemp, particularly around tax policy and the merits of supply-side economics, I have to admit I wholly agreed with him on even those issues at the time.  Only the experience of the last decade has changed my mind.

Becoming Bob Dole’s running mate in 1996 was the kiss of death, as it would have been for anyone, but he served because he was asked and went down fighting.  By the late nineties the Pandora’s box of Birchers, Fundamentalists and Neo-Confederates cracked open by Reagan had begun to wreak its toll on the political landscape.  Kemp was despised by the new extremists particularly for his candid posture on race.  By then no Republican politician willing to defiantly embrace a hell-bound Democrat was going to be tolerated in a leadership role.

When in 2002 he began to say some sober, sensible, and entirely heretical things about Iraq and the War on Terror (“What is the evidence that should cause us to fear Iraq more than Pakistan or Iran”), he was summarily ushered to the margins of the conservative movement.  He would continue to speak on the subject, but there was no one left to hear him.  He turned out to be dead right, not that it did him or us any good.

Congressman Jack Kemp died of cancer in 2009. The tensely muted eulogies from the new far-right politainers for one of the chief architects of the Reagan Era told the sad tale of our time.

This excerpt from a particularly snarky 1989 New York Times piece on Kemp is how I prefer to remember the man I so admire:

“You know what’s interesting?” asks Jack Kemp, a nonstop talker who finds a great many things interesting, and who had to be dragged out of two interviews by an aide long accustomed to humoring her boss’ verbosity. ”The idealism is now on the conservative side of the spectrum, and the pessimism is on the left. And for a long time it was the left that was idealistic, and it was the right that was pessimistic. And it drives our friends on the left crazy that you can be both conservative and idealistic and progressive simultaneously.”

Those were good times.  That was the atmosphere and attitude that made me a Republican.  It’s a return to that naive love of America and all it stands for that will restore the GOP first to relevance, and then to greatness once again.

Generation 1099

The standoff in Wisconsin between archaic public employee unions and the Tea Party Movement is creating a lot more heat than light.  As so often happens in our politics, we aren’t talking about what’s really going on.  The TP’ers rail about government spending and the unions blather about corporate power, but both seem blind to the tectonic shift occurring beneath them.  We are seeing the dawn of a new era of greater personal independence, wealth, and also risk.  Say goodbye to Employment as we once knew it.

Welcome to Generation 1099.

Our culture is built around employment.  Healthcare in the US is funded by insurance subsidized by employers.  We tell our children to study hard in school so that they can get a good job when they grow up.  When we meet someone we ask them “what do you do [for a living]?”  Losing a job, regardless of the circumstances, carries an odor.  Even though any one of us (who doesn’t work for the government) knows our job could evaporate at any time, there’s still that smell.

The unstated agreement when our ancestors left behind their Jeffersonian rural lives for the greater wealth and opportunity of a Hamiltonian city (suburb, really) was that employment could provide us with the same dignity as owning our own land.  On our little green patch of suburbia we would keep some vestige of the independence – the sovereignty – that my grandparents knew on their farm.

With a decent education and a steady job, you could be almost as free as our grandparents.  Government had little purpose apart from providing police, schools, and roads (on which to drive to work).  We could pretend that little had changed from the farm.

But employment as we have understood it for a hundred years is fading away.  It is being replaced by what Bush II’s speechwriters called “The Ownership Society.”  With each passing year, fewer and fewer us are formally employed and more of us work for ourselves (almost 1/3 of the workforce already), either as full-blown entrepreneurs or as independent contractors.  It may feel scary, but on the whole, this could become a very, very good thing.

It could lead us to an era of broadly shared wealth beyond most people’s imagination in which a culture dominated by a massive middle and upper-middle class earns money more or less at their own pace, owning their own businesses or working as contractors.  It could make the supposed Golden Age of the ’50’s look like drudgery.

Or not.  It could, if we screw this up, devolve into a sort of hell.  There are two political constituencies poised to make the nightmare scenario come true and, you guessed it, they are squared off against each other in Wisconsin right now.

The Unionocracy wants to stop the future from coming because, frankly, it did pretty well under the old model.  The ownership society will heavily reward differentiation – unique skills or technical knowledge.  Whole new industries will spring up and disappear in short timeframes.  Working in this environment will require not just higher education, but constant education that continues throughout a career.  With the right model this could be good for most union members, but the end of the road for the fat union bureaucracy.

“Labor” in the sweaty old sense of the word isn’t going overseas anymore.  It’s just going away.  It is being automated out to the margins of the economy.  Unions do not want to imagine, much less welcome this future even though they hardly represent any true “labor” anymore.  They are an irrelevant institution fighting a pointless struggle to stop this shift.  They can’t win, but they can make it politically impossible for us to adapt to meet this future successfully.

Inflexible work rules, pointless employment protections, and relentless bureaucratic resistance to adaptation will not stop the future from coming.  They will just prevent us from realizing its benefits.

The extreme fringe of the right is no more excited about this prospect than the AFL-CIO.  This new model will require a much more robust social safety net, one that extends beneath nearly everyone, not just the poor.  Healthcare will have to be completely divorced from employment.   Greater government involvement in education will have to extend from early childhood beyond college, making affordable, meaningful training available throughout life at a reasonable (which means subsidized by all of us) cost.

Instead of the Tea Party fantasy of a government that fades away, this will mean that we’re all much more closely tied to a much more nimble government regardless of class or race.   The Jeffersonian Dream will have to fade.  The alternative?

If the TP’ers have their way, we will still see the end of employment as we know it, but it will be replaced by the “disowned society.”  Without a net, the dislocation caused by this economic shift will swallow the middle class.  The only way to bridge the divide to Generation 1099 without government help will be to have significant reserves already on hand – to be relatively wealthy already.  The costs of education, healthcare, and increasingly frequent gaps in employment will overwhelm all but the rich and the rich will not be immune themselves.

Even the wealthiest will see their capital erode.  You can see the hints of this future in the asset bubbles that are tightening into shorter and shorter cycles as more concentrated wealth sloshes around at the top of the global economy competing for ever declining real returns.  Having more money doesn’t help if there’s nothing for those dollars to buy.  You can only eat so much cake.  Failure to adapt to this shift will make us all poorer and destroy a fantastic opportunity for a brighter future.

Wisconsin Democrats need to come back to the capital and face the future.  Instead of trying to protect 19th century labor unions, let them start thinking of ways to make government more nimble and adaptable.  And let’s see Republicans stop foaming about their dark, sometimes bizarre phobias and start proposing ways to make education relevant in an ownership society.  Let’s look for ways to make healthcare available and affordable without tying it to employment.  Let’s look for ways to eliminate tax penalties on contractors.

There is hard, vital work to do in building a model for government that can help us bridge the divide to Generation 1099.  If we’re going to argue, let’s argue about what matters.  Let’s not let Glenn Beck or the AFSCME – both of them trading on fear – ruin our future.

Breaking Union Power in the Heartland

You can always count Democrats to pick the wrong battle.

The new Republican Governor of union-dominated Wisconsin is using his new Republican majority in the Legislature to deal with crippling structural problems in the government workforce.  Along the way he is confronting the power of the public sector unions.  Among the “radical” proposals in Wisconsin’s SB 11:

- Require public employees to make some contribution to their own pensions.

- Require them to pay a portion of the cost of their own health insurance.

- Allow union members to vote annually on whether to retain a union.

- Tie wage increases to inflation.

- Remove the state’s obligation to negotiate a union contract on any term other than salary.

These proposals would not affect public safety occupations – police and firefighters. Success on this effort in the union heartland is likely to ripple across the country.

Democrats warn that SB11 would break the power of public sector unions.  Hopefully they’re right.  In response unions nationally are organizing massive demonstrations in Madison.  Union allies are laying out what remains of their fading capital, turning this into a potential last-ditch effort to halt their long slide into irrelevance.

The remaining Democrats in the Legislature have fled the state to break a quorum – which we know works out great. This is coming to resemble a union Alamo.  For the good of the country at large we need to make sure there is no San Jacinto for this movement.

One of the most crippling problems for government, particularly state and local governments, is the absurd clout of public employee unions.  Texas doesn’t experience much of this for a variety of historical reasons, but in states that were fully settled and developed by the early 20th century the union legacy is a serious obstacle to adaptation.

These organizations have outsized political influence because of their ability to turn out disciplined, motivated political volunteers financed in large part by public money (it’s part of the Goldwater Conundrum).  If you think corporate lobbyists are a corrosive influence on government spend some time with the unions.

In private industry unions are fading away because they starved their hosts and accomplished little for their members.  Whole industries which were saddled with powerful unions have shriveled up and blown away.  Unable to change at the speed of business because of the bureaucratic nightmare of a collective bargaining agreement, heavily unionized industries are in the final stages of extinction.  Outside of government, union membership has been a great way to eliminate your own job.

A union helps employees in fields where labor is fungible (any arm will do the same lifting) negotiate collectively to gain some basic dignity and humane working conditions.  This protection is vital for data analysts, teachers, clerical workers, nurses and other government employees because…well, help me here.  Their tiny fingers get caught in the machines?  Even FDR recognized the dangers of unionizing public employees.

Unions have done to government what they did to private sector businesses – made them fat, slow, and ineffective.  The civil service is rigid enough on its own.  Add unions and it becomes even worse.  Public jobs can’t be changed or eliminated when necessary.  Employees can’t be incentivized for outstanding performance – so you rarely get that kind of performance.  The power of public employee unions has over time transformed many critical jobs from public service to public subsidy.

This is a particularly important problem because government stands to play such a crucial role in our evolving economy.  That’s right, government stands to play a crucial role.  The problem is most visible in education where the state has an irreplaceable part to play and the unions have consistently crushed innovation to protect their narrow interests.

The political fight unfolding in Wisconsin (and coming soon in Ohio and other states) is not, as Democrats claim, an attack on the middle class.  It’s about making government work for the governed, not for special interests.

By extension, it will determine which states will be ready to grow, adapt, and thrive in the coming century and which ones will stagnate.  Places like Michigan, Illinois, and Wisconsin are making a choice whether to adapt to the 21st century or devolve into a giant post-industrial theme-park where people go to see what the “old days” were like.  Think of Colonial Williamsburg, but with rusted-out factories and empty houses.

How long can Democratic legislators hide out in Illinois?  Well, there’s a lot more entertainment in Chicago than there was in Ardmore.  But these standoffs seldom accomplish anything.  Let’s hope this standoff reaches its likely, successful conclusion soon.

We’re #1!

In a survey released this week in USA Today Americans were asked to name the world’s largest economy.  More than half of them named China.  That answer isn’t just wrong, it’s wrong by a mile.  America’s economy remains more than two and half times the size of China’s and their per-capita wealth has yet to surpass Albania’s.

That answer reflects a quality in our culture even more basic than our adorable ignorance of the rest of the planet.  Without a clear, external challenge we are as sad and lost as an orphan in a Dickens story.

We crave an enemy.

The challenge of our time is administration.  It is complexity.  That’s a gift people in previous generations suffered heavily to grant us.  It’s a better class of problems than any human culture has ever been privileged to face.  And we don’t want it.  We can only stand to think of who to fear.

We must figure out how to responsibly operate a beautiful machine we did not build and are steadily ruining.  We are rebelling against the challenge with pathetic fury.  We are manufacturing conspiracies and straw enemies because it is so much easier for a culture with collective ADD to hate an entertaining villain than to solve a problem.

The hard, grown-up job of administration in a capitalist economy is something we would expect conservatives to be uniquely suited to.  What are we doing?  Fighting to stop Islamic Terrorists from infiltrating CPAC.  Yea, that’s right.  The Muslim Brotherhood has allegedly infiltrated CPAC.  And we want to be taken seriously.

We desperately need some grown-ups in the room.  We need someone to bring some reason and intelligence to our debates over policy.  We probably need this more urgently than we need new birth certificate requirements.

China is not yet a serious world power.  Islam is not a threat to our sovereignty.  The gays, the Mexicans, the secret Kenyans, the Tides Foundation, the Bilderburgers, the Hamburglers – they are entertainment.  They are not a threat. Here and now we are the most prosperous and powerful nation on Earth.

We are the only people on the planet with the power to destroy us.

Don’t Worry About Gas Prices

The current bull market in commodities is affecting more than just oil prices.  And although headlines explain the rise with “global recovery” and now turmoil in Egypt, those guesses are just recycled from the last bubble.  There is nothing in the supply or demand of any of these underlying commodities to explain the price momentum.

Look at the price and supply/demand stats for copper over the past quarter century.  Check similar stats for other commodities at the USGS website here, or prowl through Indexmundi, paying special attention to the overall commodities index for the past twenty years:

Look closely at the sustained boom that starts in 2002, collapses briefly during the crash, then skyrockets again in 2009 when the world was still locked in recession.

Price is always dictated by supply and demand.  So why would prices for aluminum or cocoa spike this way if the supply and demand are relatively flat?  You have to understand what buyers are actually demanding.  Here’s a hint – it isn’t any of these commodities themselves.

This asset inflation is being driven mostly by two factors: extremely low interest rates and deregulation of asset markets.

First, a decade of extremely low federal funds rates made massive amounts of money available cheaply to financial institutions. That was supposed to be invested back into the economy; leant to small business and entrepreneurs and so on.  But new business investment has been weak for a long time.  Instead this cheap money went looking for returns in a different direction driven by the second factor – changes in the rules of the asset markets.

The markets that set price for the foundational elements of modern capitalism were carefully guarded for decades.  Those markets needed speculators in order to function properly, but they needed a limited number of fairly sophisticated ones.  Operating mostly in narrow bands of value, these were some of the most cutthroat markets in the world.  For speculators these were mostly arbitrage markets – no place for the average investor to be squirreling away his retirement savings.

In the last few days of the Clinton Administration we started opening commodities markets to wider speculation with a new law that would set the table for the economic collapse of the ‘aughts.  The first step was a set of provisions sponsored by Texas Republican Phil Gramm in the Commodities Futures Modernization Act.  You could write a book about that law and what it meant, but in short it exempted derivatives from any Federal oversight, elminating a bunch of evil, Communistical rules that had kept big institutional investors from driving up commodity prices.

Soon, even federally insured banks were bringing their (your?) money to Chicago.

Commodities don’t trade like stocks.  When you place an order on the Chicago Mercantile Exchange for 80 railcars of corn to be delivered in September, that order will be fulfilled in September.  If you don’t sell that contract to someone else, you’re going to be feasting on a lot of cornbread this fall.

If you want to make money in the commodities markets and you don’t actually want a railcar full of corn you must rely on a large number of carefully balanced transactions.  Big investors like banks, pension funds, and sovereign wealth funds are not organized to do that.  They look for longer bets – the institutional long.  They bought derivatives based on pools of commodity contracts that allowed them to hold something long-term.  They flooded these markets with new capital, biased toward long positions, that could not be absorbed or invested.

Low conventional interest rates and the erosion of the old rules have driven up the demand for commodities as speculative assets.  It has done nothing to the demand for, say, copper or corn themselves.  But it has created intense new demand for securities based on those commodities’ market performance.

The result has been a very strange combination – inflation and glut.  There was (is) not enough value in those markets to absorb the capital inflows.  The new capital didn’t successfully stimulate growth because it was based on phantom demand – pure market manipulation.  Just before the last crash we ended up with prices through the ceiling and oil tankers idling off the coast because storage capacity was exhausted.  After the collapse the machine has started all over again.

What to do it about it?  For starters, restore some of the sensible rules that once made these markets work.  But that would only deal with part of the problem.  This is tied to a larger set of ills that affect other markets as well.  Our high corporate taxes, repeated personal tax cuts, public debt, weak economic growth, intensifying concentration of wealth, poor infrastructure development, and the growth of unregulated derivatives are all factors. But that’s another story.

For more on derivatives, you can watch the full episode of Frontlines’ The Warning.

And don’t worry too much about your expensive gas.  The price will collapse again soon enough.

That’s what we should be worried about.

U.S. Fundamentalists Worry About Egyptian Fundamentalists

It takes one to know one.

Mike Huckabee, who is campaigning for President in one of the most critical states for any Republican candidate – Israel – warned this week about the threat that fundamentalists will hijack Egypt’s democracy protests.  Huckabee knows these dangers well.  As a leading figure in the fundamentalist movement that has hijacked the Republican Party he understands how easily a well-intentioned drive for liberty can be subverted.

Huckabee’s warnings have been echoed by one of his strongest fundamentalist rivals in the upcoming race for the GOP Presidential nomination.  Rick Santorum warned that we shouldn’t be fooled by the protestors’ statements about non-violence because these people are “for all the things that violent jihadists are for.” Violent or not, according to Santorum they are as dangerous to western civilization as Al Qaida.

What is the group that Huckabee claims “could threaten the world and all who seek peace in it”?  Well, the Muslim Brotherhood, a fundamentalist party which long ago abandoned violence and has held seats in Egypt’s parliament.  They are expected to wield significant influence if Egypt elects a free government.  I agree that a movement that loathes Western secularism and seeks to replace it with a government based on what it sees as the only source of legitimate authority, God’s Law, is indeed a terrible threat to freedom.

The legitimate concern that fundamentalism might poison politics in a democracy is nothing new.  Barry Goldwater warned us about that threat twenty years ago, but he was talking about guys like Huckabee and Santorum.

Nominally speaking about abortion in his 2008 campaign, Huckabee outlined the standards that should guide law:

“I believe it’s a lot easier to change the constitution than it would be to change the word of the living God, and that’s what we need to do is to amend the Constitution so it’s in God’s standards rather than try to change God’s standards.”

Now, this is completely different from the Muslim Brotherhood because of the, uh…well.  You know those people…er…you see.  Oh, those people sometimes wear beards.  There’s that.  So they are completely different from American fundamentalists who are overwhelmingly clean shaven.

The Muslim Brotherhood just wants to protect traditional values, stop Communism, preserve respect for religion in the public sphere, prevent a gay agenda from destroying the family, shelter women from the liberal influences of feminism, and build a democracy that is bound by God’s laws.  These guys line up with the religious wing of the GOP almost plank for plank (except for Israel).  Peel the word “Muslim” off their agenda, carry it to the Texas GOP Convention, and how controversial would it be?

Huckabee and Santorum are right to be worried about the Muslim Brotherhood.  Its members claim to be committed to peaceful participation in the political system.  But if they grow frustrated with their lack of influence in public policy, can we really be sure they won’t resort to 2nd Amendment remedies?

If a heightened risk that fundamentalists might win elections was a disqualifier for democracy, we wouldn’t be allowed to have it either.

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