A Timely Reminder

The most recent issue of the Harvard Law and Policy review was devoted to analyses of the “State of the States: Laboratories of Democracy.” The introductory essay, by Joel Rogers, made an important point that is all too often obscured by our focus on national issues, personalities and campaigns: the federal government really doesn’t run the country.

The federal government controls many public functions, some of them uniquely: macroeconomic policy and interstate commerce, the currency and its value, war and foreign policy. But on nearly everything else that government touches, state and local government play a far greater and more active role. Our national government is essentially a big insurance company, debtor, and gigantic military. Takeaway non-discretionary income transfers, debt service, and national defense, and its 2014 spending was only 0.7% of GDP, its total investment and consumption was only $472 billion, its total non-defense civilian employment was only 1.3 million. By comparison, in that same year, state and local governments spent 10.3% of GDP, did $1.9 trillion of investment and consumption, and employed 14.3 million people respectively, fifteen, four, and eleven times as much as the federal government.

Furthermore, he points out that the areas of our common lives that are subject to local control tend to be areas that are pretty important to most citizens.

That includes, inter alia, the quality of their public schools (where state and local governments not only provide ninety percent of funding, but also control what and who is taught, by whom, and how); environment (through state and local government control of energy use, transportation, most water, and waste disposal); neighborhoods (through their control of land use, zoning, housing, parks and other public spaces, police, and emergency response); and our democracy (through their control of voting rights, campaign and election administration, and decennial redis-
tricting). The power of the federal government is distant, and slight, com-
pared to this.

Take a close look at the list of decisions made by state and local government units, and then consider which candidates and/or parties are most likely to perform those tasks competently and in the public interest.

Here in Indiana, at the state level, the Pence administration has a truly deplorable record on education (what some have characterized as a “war” on public schools). It has fought environmental regulations to the point of suing to avoid compliance. And the Indiana legislature has an equally deplorable record, especially when it comes to democracy: not just redistricting, which has allowed legislators to choose their voters, rather than the other way around, but refusing to extend voting hours  or to consider other measures to encourage, rather than discourage, voting.

We need to remember the importance of our “down-ticket” choices when we go to the polls in November. Donald Trump may pose a more existential threat, but that’s no excuse for failing to appreciate the importance of offices closer to home.
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It’s Not Politics: It’s Morality

Jennifer Rubin is a conservative columnist for the Washington Post. Her column on July 31st was a scathing analysis of Donald Trump and the political and moral challenge his candidacy poses to the GOP.

House Speaker Paul D. Ryan (R-Wis.), Senate Majority Leader Mitch McConnell (R-Ky.) and vice-presidential nominee Gov. Mike Pence of Indiana (R) knew what they were getting into when they climbed aboard the Donald Trump bandwagon. They had watched him insult minorities, POWs, the disabled and women. They had seen for themselves how utterly ignorant he was about basic policy concepts. They knew he lied about big and small things (e.g., falsely saying he opposed the Iraq War, reneging on charity pledges until shamed by The Post). They knew he’d stiffed and swindled Trump U students. They never should have backed him; they were abetting a vile individual attaining the country’s most powerful office, for which he was patently unfit. Pence went a step further in agreeing to be his running mate, and now travels around the country cheerleading for Trump.

Rubin recounted the now-ubiquitous details of Trump’s attack on the Kahns–a Muslim Gold Star family–and notes in passing that it would be political karma if, after smearing all Muslims, his attack on these particular Muslims was the “bridge too far” that ultimately brought him down.

Rubin’s column wasn’t written to add to the mounting recognition of the danger Trump poses for America, however. It was a challenge to the Republicans who continue to support and enable him.

What does Pence, father of  Marine 2nd Lt. Michael J. Pence, do? He directs the press wanting comment to Trump. Really, that’s it? One wonders how 2nd Lt. Pence — and all the other Americans risking their lives — feel about that. Pence’s silence and continued presence on the ticket suggest he considers Trump within the bounds of normal political discourse. If Pence had a modicum of dignity or decency, he would tell the American people, “I made a terrible mistake. Mr Trump is so morally bankrupt and of such shabby character that I could not possibly serve with him.” Failing to do so, the same should be said of Pence….

The offices of Ryan and McConnell wouldn’t comment on Trump’s slur against Ghazala Khan or ludicrous claim he’s “sacrificed” just as the Khans have. Their spokesmen would only repeat the bosses’ prior remarks on Trump’s Muslim stances. That’s not the point. They know this but they are abdicating moral leadership because they cannot possibly justify their support of Trump. In their silence, they condone Trump and stand with him.

Rubin is unimpressed with the excuse that other Republican candidates find themselves in a difficult bind, unwilling to incur the hostility of Trump’s supporters by distancing themselves from his repugnant accusations.

Republicans who fell in line behind Trump cannot escape the moral stench he emits. He disrespects parents of a fallen warrior; they do as well with their silence. He attacks other Americans, lies habitually and embodies none of the qualities we expect of elected leaders; they demonstrate moral and political cowardice in refusing to condemn him.

At the end of the day, Rubin–and the many other Republicans who have publicly refused to support the GOP nominee–is making a moral argument. For moral individuals, love of country, concern for civility and fair play, and simple intellectual honesty should take precedence over partisan loyalty.

Paul Krugman recently made the same point.

The real sinners here are Republican leaders — people like Paul Ryan and Mitch McConnell — who are actively supporting a candidate whom they know poses a danger to the nation. It’s not hard to see why they’re doing this. Opposing their party’s nominee, no matter how awful he is, would probably end up being a career killer.

But there are times when you’re supposed to put such considerations aside. The willingness of some people who know better to support Donald Trump is understandable; it’s also despicable.

And these columns were written before Trump suggested that “2nd Amendment people” could “take care” of Hillary.

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Numbers Can Be Deceiving

Well, the Orange One has delivered a “major” speech on the economy. As usual, very little he said is remotely accurate; here’s just one example from a Time Magazine article deconstructing those claims:

Trump’s claim that one-in-five American households “do not have a single member in the labor force” is also therefore not a reflection of employment problems so much as it’s a recognition that 20% of American households are headed by retirees. Your 85-year-old grandfather and his 82-year-old wife aren’t participating in the labor force—and that’s probably a good thing.

Because we Americans have a tenuous grasp of economics, politicians often feel free to play with the numbers. That’s nothing new (although Trump does take misinformation to a whole new level…)

Last May, the website of the Indiana Institute for Working Families had a discussion of unemployment numbers that explained what those numbers do–and do not–reveal about the health of a state’s economy. Since we are in the middle of a campaign season in which Trump and other candidates will continue to take liberties with those numbers, it is worth revisiting that explanation.

The post itself was triggered by a seemingly rosy employment report: more Hoosiers were working, and the workforce was nearing an all-time high. Good news, right?

Well, as the policy analyst explained, “all that glitters is not gold.” Among the reasons for caution is something called the Labor Force Participation Rate.

 it’s also important to look at the Labor Force Participation Ratio (LFPR)—the ratio of the civilian labor force to the total non-institutionalized civilian population 16 years and older—as a useful tool in determining the overall health of the labor market. A low LFPR means there is slack in the labor market, which puts downward pressure on wages, and holds back growth in household incomes.

In layman’s language, the LFPR means that a decline in the unemployment rate can be explained, at least to some extent, by the number of Hoosiers leaving the labor force. That’s because workers are only counted in the unemployment rate if they are actively seeking work. But the workforce dropout rate isn’t the whole story either.

That brings us to the third and final point, which helps to illustrate declining LFPR; while the state is reaching employment levels (total nonfarm employment) not seen since the summer of 2000, the population of adults in Indiana (16+) has grown by more than a half-million during that time period. In other words, Indiana has added jobs, but not nearly enough to keep up with population growth.

Worse yet, the jobs that the state is adding are low-paying jobs. A recent report from the Indy Star – Economic Gaps Growing Among Hoosiers – encapsulates the conundrum that is the state’s insistence on low road growth strategies: “As the state economy grows and state leaders say pro-business policies have created more than 57,000 new jobs last year alone, poverty is on the rise. That’s right. More jobs, yet more poverty.”

It’s always useful to consider what the statistics tell us–and how the real story differs from the snake-oil on offer.
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Do Basic Income Proposals Make Any Sense?

As much of the developed world struggles to address the growth of income inequality, several countries have considered proposals for a guaranteed basic income. There are a number of variations, but the basic idea is that government would eliminate the various forms of social welfare that are currently in place, and would instead send each citizen an annual amount sufficient to cover basic living expenses.

Most of us understand that without economic freedom, guarantees of personal, political and religious freedom aren’t worth much. If your day-to-day existence is consumed with the struggle for survival, the fact that you have freedom of speech is small comfort.

A practical argument for a guaranteed income is efficiency—there would no longer be a need for the massive bureaucratic apparatus currently required to administer social welfare programs, no need to determine eligibility under the different standards for different programs. (Many years ago, conservative economist Milton Friedman proposed something similar: a “negative income tax” that would require payment from those earning above a certain amount, and send remittances to those below that threshold.)

Social science scholars see other benefits. As automation steadily displaces what were once middle-class jobs, receipt of a stipend sufficient to cover basic living expenses would allow people to go back to school, or to train for alternative employment, or work part-time. It would give new mothers—or fathers—the option to take time off to care for newborns; it would similarly facilitate caretaking for gravely ill spouses or parents.

We also might expect that with a lessening of abject poverty, a number of the social ills that accompany privation would improve.

As positive as all that sounds, however, there are reasons why efforts to implement a guaranteed income have fared badly. In Switzerland last year, a basic income proposal on the ballot was overwhelmingly defeated; in 2013 ,the German Parliament debated a similar proposal and rejected it.

The first—and most obvious—negative is cost. Although economists argue about the actual net cost, after savings from eliminating our current expensive patchwork of social programs—any such approach would clearly require tax increases. In the United States, where taxes have become a dirty word even when they are earmarked to support basic services, this fact alone probably presents a politically insurmountable barrier.

Economists and others also question whether receipt of a guaranteed income, no matter how modest, would reduce the incentive to work. There is very little empirical data on that issue; however, there was an interesting experiment in Manitoba, Canada, during the 1970s, called Mincome. It was intended to assess the social impact of a guaranteed annual income, including whether it would cause such disincentives, and if so, to what degree. Apparently, only new mothers and teenagers worked substantially less. Mothers with newborns stopped working because they wanted to stay home longer with their babies, and teenagers worked less because they weren’t under as much pressure to support their families, which resulted in more teenagers graduating. However, participants knew the project was not permanent, and it is impossible to know whether—and how—that knowledge affected the results.

There are a number of other legitimate concerns about so drastic a shift in the way we discharge our obligations to our fellow-citizens.

Given American cultural attitudes that valorize work and demean those who rely on public assistance, it’s safe to say that the United States is unlikely to institute a guaranteed income program (it certainly won’t happen in my lifetime). But even if guaranteed income isn’t the answer, it is worth asking what it should mean to be a member of a political community. What are the reciprocal obligations of the citizen and the state?

What do we owe the nation, and what do we owe each other?

If membership has its privileges, what should those privileges look like?

 

 

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Contrary to Popular Belief

Contrary to Popular Belief is the title of the just-issued book based on Michael Leppert’s blog about Indiana government, for which I was honored to write the Foreward. As he does in his blog, Leppert offers a thoughtful and informed window into state government.

If timing is really everything, the book should hit the big time, because (among other things), there are numerous observations of Indiana’s Governor, who is now a Vice-Presidential candidate on the “Mango Mussolini” ticket. (I stole that description from John Oliver.)

There are insights into Pence’s contract with Real Alternatives, observations about the departure of Lieutenant Governor Ellspermann (arguably the only truly competent member of the administration), about the Governor’s efforts to prevent resettlement of Syrian refugees in Indiana, the “news” bureau disaster dubbed Pravda on the Prairie, the anti-abortion bill funeral requirement that sparked “Periods for Pence,” and of course, RFRA. Among others.

As I wrote in the Forward, Contrary to Popular Belief is an effort by one of Indiana’s most thoughtful, perceptive and informed observers to break through our cynicism, to avoid the constant hype and agitprop coming from entrenched interests, and to engage in what has come to be seen as an almost subversive act –actual communication about the ways in which our state and local governments function. Such communication, unfortunately, has become rare in our polarized age, especially when its focus is at the state level.

There are many valuable observations in the pages of this book, but there are three insights that I think are especially worth emphasizing. First, and perhaps most obvious, is a very personal and candid look at the reality of lobbying—a reality far removed from the popular image of nefarious characters in pin-striped suits working to subvert democracy in order to enrich their corporate masters. Such individuals undoubtedly exist, but they do not represent the legions of policy advocates who see their job as informing the legislative process and ensuring that contending points of view are adequately represented.

The second observation is related to the first: to the extent our democratic system fails to work, it is because all points of view are not equally or even adequately represented—and the reason that is so, the reason democratic institutions do not work as well as they should—is less likely to be the result of individual malfeasance than it is of systemic influences. One of the great virtues of this book is its author’s rejection of the impulse to paint “them” (insert your preferred nemesis here) as the source of all our problems, and his illumination of the ways in which our state and local governments actually work.

It turns out that there are many diligent and well-intentioned political actors on both sides of the aisle who actually want to improve the lives of Indiana citizens. Sometimes they agree on the best way to do so; sometimes they don’t. Making good policy, it turns out, is more complicated than simply electing those you believe to be the “good guys.”

And that brings me to what I personally believe is the most important insight Leppert shares: the fact that “the average person in Indiana now knows far too many trivial tidbits about high profile government types in Washington, D.C. and less and less about their state legislators, mayors and city councilors.” Americans—and Hoosiers—are dangerously ignorant of the governing systems within which they live and work, and the ways in which those institutions structure and affect their own daily lives.

The book is available on Amazon.

 

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