Friday, November 19, 2021

Sociological Bent

So two weeks ago was Bad David Brooks, and last week we had Self-Help David Brooks ("The Awesome Importance of Imagination", which read like a compilation of BrainyQuotes, though it actually wasn't), so naturally today Woke David Brooks is doing a shift ("Joe Biden Is Succeeding"), which among other things praises the Biden agenda to the skies. And then explains why he's qualified to disagree with the economist Lawrence Summers on the subject of whether last spring's American Rescue Plan might overstimulate the economy and lead to inflation

Larry is one of the most intelligent people I’ve ever known and someone I really admire. If I were an economist, I might have agreed with him. But I’m a journalist with a sociological bent. For over a decade I have been covering a country that was economically, socially and morally coming apart. I figured one way to reverse that was to turbocharge the economy and create white-hot labor markets that would lift wages at the bottom. If inflation was a byproduct, so be it. The trade-off is worth it to prevent a national rupture.

and then agrees with him anyway

But Summers was right. The stimulus — along with all the supply chain and labor shortage disruptions that are inevitable when coming out of a pandemic — has boosted inflation. In addition, Americans are exhausted by a pandemic that seems to never end.

This is a really useful example of a pervasive Brooksian error, part of his "bent" I guess, of confusion between the descriptive analysis of a particular situation and the prescriptive recommendation of what you ought to do about it, most typically when the subject is psychology, and he lurches from academic papers to self-help books and back without any consciousness that the two have different purposes and different standards. This is something a lot of people have trouble with, I think, though not quite as nakedly as he does, so it's worth talking about.

In the question of Summers here, what he means is complicated by the difference between the discipline of economics and the "bent" of sociological journalism, and the problems being in two different worlds: for Summers the problem of inflation, which is probably bad, and for Brooks, the problem of "national rupture" economic, social, and moral all at the same time, which is nightmarish, if it does indeed mean something. Brooks actually does agree with Summers's analytical conclusion that the American Rescue would lead to inflation, but does not agree with the prescriptive conclusion that the American Rescue should have been junked, because the plan is good for the rupture issue, which Summers presumably isn't interested in, but on the other hand it's bad for the Democrats, because inflation and Covid fatigue will lose them the 2022 election.

In a way he's wrong on both counts. Summers would have been right about the economic danger to society as a whole if he had been right about the economic analysis, because what he was afraid of was a Japanese-style stagflation from all that Federal Reserve pumping money into the system since 2009 (which Summers helped design), and still is, for some reason—

“What markets are seeming to price in is a return to secular stagnation, or Japanization,” Summers said at a London School of Economics event on Wednesday. 

Summers, now a Harvard University professor, adds that “extremely low interest rates set the stage for leveraging and the perpetuation of zombie enterprises and the perpetuation of financial bubbles. We’re seeing a lot of evidence of speculative risk. Extremely low and negative real interest rates are problematic.” 

—whereas what's been happening over the past several months just isn't like that, in the first place; as Krugman explained today in one of his "Wonking Out" posts, it's not driven by the factors of permanent vicious inflation, but by pent-up real demand for real stuff driven up by supply chain bottlenecks and rising wages driven by the Great Resignation. To which I would add that the quantitative easing is being "tapered" away, the zero interest rates raised, and the supply chain issues resolved, in part thanks to the Biden infrastructure bill signed this week, but the higher wages aren't going away, and the ongoing surge in successful labor activism isn't going away either. 

This is a spectacular economic outlook, with unemployment heading below 4% and GDP growth rising to 5% by mid-2022, higher consumer spending and higher personal savings, and the other thing is if that's bad politically for Democrats because of a little inflation (easing back to 2%), I just don't get it. There is only one economic thing that Democrats can do that gives us a minimal chance of holding Congress in 2022, and that's to hold the course we're on with this week's BIF and BBB triumphs (that plus, of course, continuing at the current pace to conquer Covid, and lifting the filibuster to pass Manchin's voting rights bill, which I believe is on somebody's agenda already, though nobody's talking about it). 

Brooks says,

My fear is not that Democrats lose the midterms — it will have totally been worth it. My fear is that Democrats in Congress will make fantastic policies like the expanded Child Tax Credit temporary to make budget numbers look good. If they do that the coming Republican majorities will simply let these policies expire.

Actually, the Democrats have already done that, I'm sorry to say, limiting it in the current version of BBB to one year, after which it goes back to the earlier $2000 per child (on the other hand they won't go back to limiting it to parents who owe taxes—the "refundability" introduced this year, meaning you can collect it even if you have no income at all, is permanent). It wasn't to "make the numbers look good", either, but to satisfy Senator Moral Hazard Manchin that voting for the bill wouldn't put his immortal soul in danger.

The mischief a renewed Republican majority in Senate and House could achieve isn't limited to that, either. They would certainly want to cancel whatever money they could for electric vehicles and renewable fuels, for pre-K and quality day care, for affordable Wi-Fi and affordable housing, and cut back taxes on millionaires, corporations, and stock buybacks to Trump levels.

And in that case, sorry, but no, it wouldn't have "totally been worth it" at all.

The current crop of Democrats need more than two years to leave a legacy, that's all there is to it. Passing these two bills and then retiring into defeat a year from now won't cut it. That definitely won't stop a "national rupture" from taking place. It looks as if Brooks is stepping back from his fulsome Biden praise into a traditional Republican posture of hoping the Democrats will just quietly clean up the Republican mess and then go away.

We're always talking about the things Republicans do that we wish Democrats would do, and mine is developing the ability to double down. Far from patting ourselves on the back and moving aside for David Brooks to bask in the bipartisanship, we should campaign, FDR-style, on how much we haven't done and how much more we need; on the understanding that what's been accomplished this year is just a down payment and more remains, from that Medicare dental plan and free college to the wealth tax. I know it's a long shot, but from the standpoint of what they've achieved so far this year it doesn't look impossible. Thank you, Brandon!

Truman job approval at around 35% a year before the 1948 election, via Quora

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