Relevant and even prescient commentary on news, politics and the economy.

Trump Invites China to Hack His Emails—and Uncover All the Details of His Business Ties to Russian Oligarchs. Cool!

Well, by now y’all know that Donald Trump held a press conference today at which he invited Russia to hack into Hillary Clinton’s email server and retrieve the 33,000 emails she deleted.  When questioned about the propriety of encouraging anyone—much less a foreign power—to commit cybertheft, he said Russia probably already had the emails and that, if so, they should release them.

When asked whether it troubled him to urge the release of stolen information, Trump said … well, you the answer.

Okay, so Russia has his back, front, sides and center.  Which must be comforting for him, if not for us.  China, on the other hand … doesn’t.  Not in the same way, anyway.  And China’s hack expertise would make Russia’s look like high school computer lab class, I’d guess.

It’s hardly a secret—except to most American voters—that Trump has extensive business interests with very wealthy Russians, and wants to partner with Russians in businesses in Russia itself.*

So here’s where China comes in: Just today, Trump made it official that he won’t be releasing his tax returns, so you can stop holding your breadth.  But copies of his tax returns, not to mention other evidence of his financial dependence, probably are on Trump’s personal or business computers.  The obtaining and release of copies of them—including emails between Trump and his son Donald Jr., and Trump and his lawyers, and Trump and his accountants, and Trump and the oligarchs—would, to borrow from a comment of Trump’s at the press conference, be highly rewarded by the media.

And also to borrow from Trump’s comments today, I want to see them.

But of course Hillary Clinton, not being Donald Trump and all, can’t openly invite China to do this.  So I will.  I’m not Trump either, of course.  But I am just swapping out one country for another, and one U.S. presidential candidate for another.

And Trump did start it.  So it’s okay for me to do this, right?

____

CORRECTION: *Paragraph edited significantly for accuracy. 7/28 at 11:41 a.m.

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What Bill and Hillary Clinton Don’t Get: That the way to win Rust Belt white blue-collar voters isn’t to go centrist; it’s to go economic populist.

The changes to the platform testify to the strength of the Sanders campaign, and, like that campaign, they are a sign that the dynamism within the party arises right now from its left­wing faction, led by politicians like Mr. Sanders and Senator Elizabeth Warren of Massachusetts.

What is less clear is if Mrs. Clinton is aiming to dispel that momentum with some gestures, including a few planks in a platform, or if she intends to actually lead the Democrats in the direction demanded by Mr. Sanders — a direction that would mean a radical redefinition of what was once understood to be Clintonism.

Hillary Clinton’s New Democrats, the NYT editorial board, yesterday

One thing that puzzles me is the anger among so many pundits that the Sanders supporters who still protest and won’t vote for Clinton are doing so because Sanders didn’t get everything he wanted in the platform.  These pundits are offended that there remain such vocal holdouts notwithstanding the extensive concessions to Sanders that were made.

But as I mentioned earlier this week and as the NYT editorial board understands, for (I believe) most Sanders supporters—those who, like me, will vote for Clinton, and those who will not—the critical issue is whether she intends to renege on her current support of those platform concessions, in the remainder of the campaign and then, if elected, as president.

One line late in Bill Clinton’s speech concerned me.  I don’t remember the precise phrasing, but it suggested that voters should vote for Hillary Clinton because her policy proposals are affordable and possible to get through Congress.  The line, in borrowing Hillary Clinton’s selling point on her policies over Sanders’ throughout the primary campaign except suddenly just before the California primary, struck me as a dog whistle to, I guess, moderate Republicans that it’s the proposals she campaigned on, not the ones in the platform, that she plans to offer and push.

Washington Post columnist and blogger Dana Milbank, a Clinton supporter all the way and one who throughout the summer, fall and early winter trashed Sanders’ proposals as utterly unrealistic, surprised me by writing (I guess) Monday afternoon, in a lengthy post titled “Clinton leaves Democrats’ liberal wing high and dry”:

That the Sanders supporters were frustrated is understandable. Clinton and the Democratic Party have given the progressive wing of the party short shrift in favor of an appeal to the political center. …

Clinton, after securing Sanders’s endorsement, chose as her running mate Virginian Tim Kaine, who has a centrist reputation and has been a free-trader.

Then there was the leak of DNC emails, which proved what Sanders had long alleged: The party was working to help Clinton defeat him. Democratic National Committee Chairman Debbie Wasserman Schultz was ousted after the email revelations, but Clinton promptly named her an “honorary chair” of her campaign.

From a strategic perspective, this is probably a mistake. Clinton’s playing down of the progressives in Philadelphia comes from a belief that she can do better among the non-college-educated whites who have been the core of Trump’s support. But her deficit among non-college-educated white voters, about 30 points, isn’t much worse than President Obama and John Kerry did. Rather than making overtures to the shrinking ranks of blue-collar white voters (just over 30 percent of the electorate, down from half in the 1980s) who aren’t likely to be persuaded, Clinton could have used her vice-presidential selection and her convention to boost enthusiasm among progressives.

I certainly agree with Milbank that this probably is a mistake, but for an additional reason as well as the numeric one he cites.  The substantial number of white blue-collar workers in the upper Midwest and northeast who support Trump not because of his Build the Wall and bar-Muslims promises but instead for the strictly economic-populist reasons that Trump uses as bait.  Some of these voters voted for Sanders in the primaries and caucuses.

Hillary Clinton should remember that taxes and net wages aren’t the only thing that matters to people’s bottom line—her repeated claims to the contrary during the primary season in challenging Sanders’s proposals notwithstanding.  Suffice it to say that healthcare deductibles and co-payments and healthcare insurance premiums, whether deducted from wages or salary or paid independently, are for many, many millions of people not affordable. If she does not understand that, she truly is out-of-touch.  Same for college affordability.  Etc.

The Clintons reflexively reach for centrism as their crutch.  Always.  But they appear unaware that the very definition of centrism has changed within the last year and a half.  As someone who views their electoral success as a personal existential necessity, I wish Clinton would consider this.

Meanwhile, Greg Sargent reports this morning that during an interview of Trump this morning Bill O’Reilly said there “has to be” a federal minimum wage. And then Trump said this:

There doesn’t have to be. I would leave it and raise it somewhat. You need to help people. I know it’s not very Republican to say…I would say 10….But with the understanding that somebody like me is going to bring back jobs. I don’t want people to be in that $10 category for very long. But the thing is, Bill, let the states make the deal.”  (Italics Sargent’s.)

Sargent added:

So basically, Trump flip-flopped and then back-flipped, holding three different positions in succession. The real story here is that Trump has no actual position on the minimum wage. His whole candidacy is a scam.

To me it looks less like a flip-flop than that Trump actually doesn’t recognize that the two are mutually exclusive.  The states can’t legislate—Make the deal? With whom?—a lower minimum wage than the federal minimum wage, since it’s not a federal minimum wage if states don’t have to adhere to it.

So maybe all Clinton has to do in order to win white blue-collar votes in the Rust Belt is quote that quote there.  Most blue-collar voters in the Rust Belt know that a federal minimum wage is, y’know, a federal minimum wage.  And that states can’t make a deal on that.

Trust me on this; they know.

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The Road to Trumpdom

I always Google my headline ideas to try to avoid the appearance of plagiarism. I was thinking of the title for this post as I was looking at a cartoon adaptation of Hayek’s The Road to Serfdom, originally published by Look magazine in 1945 and subsequently distributed in the 1950s as a pamphlet by the General Motors Corporation. As Ned O’Gorman explained,

“The Look version departed far enough from Hayek’s original text that it hardly merited the same title. Nevertheless it did present the outlines of a popularized version of the neoliberal account of legitimation crisis that Hayek articulated.”

Dick Meyer’s very fine essay The road to Trumpdom: The backstory of the biggest character in politics takes its cue from a Hayek quotation,  “As is so often true, the nature of our civilization has been seen more clearly by its enemies than by most of its friends.” Meyer traces the Republican dysfunction to the elevation of the primaries in American presidential politics, the reality TV show vulgarity and celebrity-adulation of American popular culture and ultimately to the long-term decline, since the 1960s, of Americans’ trust in government.

Meyer’s essay concludes with the decline in trust but doesn’t elaborate on the reasons for it. Of course, this has been a well-worn topic, with contributions ranging from Jurgen Habermas’s thesis of Legitimation Crisis to Michel Crozier. Samuel P Huntington and Joji Watanuki’s diagnosis of an “excess of democracy.”

My own view hearkens back to the nominal success of the O,E,C,D, growth target and its substantive failure. Under pressure from the U.S., the newly fledged institution adopted a target of 50% during the 1960s. Inadvertently, they exceeded this target by around 5%. I say “inadvertently” because when they adopted the target in 1961 they really had no idea what it meant. It just seemed like a good idea at the time.

In the meanwhile, all sorts of social, environmental, political and financial difficulties emerged that GNP growth was obviously not solving — some of them growth was exacerbating. And then the decade of the 1970s failed to repeat the economic growth “success” of the 1960s. Economic growth, it turned out, was not the promised panacea. On the other hand, lack of economic growth just made things worse.

Here is were the cartoon version of The Road to Serfdom comes into its own. “The ‘Planners’ promise Utopia…” is the title of panel 3 “…but they can’t agree on ONE Utopia” concludes panel 4.

3 and 4

In the comic book Hayek, this lack of consensus immediately leads to an impasse that can only be resolved by a strongman. In real life, the lack of consensus about concrete Utopias was resolved by targeting economic growth. A rising tide would lift ALL boats. “Everybody will be happier that way,” as Henry Wallich later reaffirmed, because:

Growth is a substitute for equality of income. So long as there is growth, there is hope, and that makes large income differentials tolerable. The environment will also be better taken care of if the economy grows. Nothing could cut more dangerously into the resources that must be devoted to the Great Cleanup than an attempt to limit resources available for consumption.

Well, growth has turned out not to be a “substitute for equality of income.” Most growth for three or four decades has gone to those at the top and large income differentials have just gotten larger and larger and larger — not more tolerable. The expanded resources have not been devoted to “the Great Cleanup” — a not insignificant amount has been devoted to denying the necessity for any cleanup whatsoever. The environment is a hoax.

The latter view is understandable in that the “planners” have taken over the environment with much the same rhetoric that they invested in economic growth. “Green Growth” is predicated on exactly the same growth paradigm. Immigration enlarges the size of the pie — there is not a fixed amount of work to be done, don’t you know — without doing much for the slice that goes to those who aren’t at the top.

Which brings us to the nomination of Donald J. Trump.

9 and 10
11 and 12

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I’m with Brian Fallon

Campaigns are complicated things. No one gets every piece of them right. Some candidates are great at big rallies. Some are good only at small events. Some are terrific TV communicators but bad on the stump. Some delegate well, and others don’t. Some never waver from a message, while others can’t seem to find one with a 10-foot pole. It’s a high-wire balancing act every day with tens of millions of people watching.

Trump is making a real mess of his campaign, Chris Cillizza, Washington Post, Jul.10

Okay, I nearly fell out of my chair when I read that 10-foot poll line two weeks ago, which is why I remembered it today.  It was no mystery which two candidates Cillizza had in mind in drawing that contrast in that sentence.

Throughout Clinton’s campaign pundits and ordinary voters alike have wondered what exactly her justification is for running for president.  But I am not among them.  Her justification, from its outset, has been that she’s a woman and that this particular glass ceiling must be broken, now, and by her.  That was, and remains, it.

Thus her cringe-inducing statement at that debate last winter that she doesn’t understand why people think she’s a member of the establishment.  After all, she’s running to become the first woman president.

And thus the focus of her speech on the night of the California primary, which it turns out troubled a number of her advisors as much as it did me.  Which is, a lot.

Amy Chozick has an article in this morning’s NYT titled “Hillary Clinton’s Team Seeks a Balance: Celebrating Women Without Alienating Men” that begins:

PHILADELPHIA — When Hillary Clinton clinched the Democratic presidential nomination last month, her campaign put together a video that framed Mrs. Clinton’s victory as a giant leap in the women’s movement. Scenes of suffragists, Gloria Steinem and little girls in their mother’s arms flashed on the screen.

The footage brought some of Mrs. Clinton’s advisers to tears, but others asked a practical, and delicate, question: What might men be thinking?

Good question. But I’ll amend it: What were women, as well as men, thinking?  The ones who think this election is really, or at least mostly, about the economic and political-power issues that Bernie Sanders has built his campaign around.  That Elizabeth Warren (no less a female than is Clinton) has built her public career around.  That Donald Trump has so fraudulently coopted, these days interspersing his claim to fight the economically and politically powerful on behalf of working class whites with his actual fiscal and regulatory policies written—literally—at the Heritage Foundation.**

Trump is now openly seeking donations on behalf of a superPAC operated by and for some of the most fiscal and regulatory regressive billionaires and multimillionaires in the world.  

Yet he’s apparently winning among white working class men who aren’t all that enthused about Building a Wall, Barring Muslims From Entering This Country, and, now—again, literally; unabashedly—turning this country into a fascist state because five police officers in Dallas were murdered by a mentally disturbed man after he lured them with a 911 phone call.

Yet the Clinton campaign, according to Chozick’s detailed article, now debating “how much her nomination this week should be focused on women.”  Chozick writes:

Some advisers believe that overemphasizing Mrs. Clinton’s historic achievement as the first woman to accept a major party’s nomination could backfire, driving away men who favor her Republican opponent, Donald J. Trump, and alienating younger women who are less motivated by gender. The result is what Democrats describe as a cautious mix, attaching the women’s movement to issues like the economy and health care. …

“This has been a long, drawn­-out debate,” said Tracy Sefl, a Democratic strategist who worked for Mrs. Clinton in 2008 and has been involved in discussions with her 2016 campaign about women’s outreach.

The debate inside the campaign about the focus on women during the convention was described by a person involved in the planning who requested anonymity to discuss private conversations.

The discussions date to the start of the campaign, when some advisers suggested she choose Seneca Falls, N.Y., the birthplace of the modern women’s movement, to hold her kickoff rally.

Others questioned whether she should visit the town at all. In the end, she started her campaign in New York City, and in April, her daughter organized a “Women for Hillary” event in Seneca Falls in her mother’s place.

A campaign spokesman, Brian Fallon, did not respond to questions on Sunday about the internal discussions, other than to say, “It will not be lost on anyone that she is a woman.”

So here’s something Clinton should understand: Every time she suggests that the purpose of her campaign is to make history as the first woman to become president she also suggests that she truly doesn’t get this election—that she doesn’t understand the economic populism of this moment.  That is true even though some of the traditional women’s policy issues she will talk about also are very much economic ones.

Brian Fallon is not, I’ll just say, a favorite among Clinton spokespeople, and I know that other fervent Sandinistas shared that sentiment over the last year.  But I think I can speak for all Sandinistas—Sanders Bros and Sanders Sisses alike—in supporting his advice to the candidate: “It will not be lost on anyone that she is a woman.”

And if she really thinks we’re stronger together she should let that speak for itself.  It will not be lost on anyone that she is a woman.

A huge problem for Clinton and her campaign has been that its unremitting focus on things everyone already knows, and its failure to educate the public about things most or at least many people don’t know about Trump’s actions.  Their specifics.  His very modus operandi.  And, for heaven’s sake, his fiscal and regulatory policy proposals.

Also from the Chozick article:*

She drives me crazy with this woman thing,” Misty Leach, 43, a high school teacher who voted for Senator Bernie Sanders in the primary, said of Mrs. Clinton. “‘I’m going to be the first woman president’ to me just feels like she’s entitled.

To me it just feels like she wants to be sure no one misses that she thinks this is what is most on most people’s minds.  Excuse me, on most women’s minds.

Clinton should think back to her husband’s War Room’s famous mantra: It’s the economy, stupid.  This time the campaign’s internal mantra should be: It’s the economic and political power, stupid.

I think Trump made a serious mistake last week in “pivoting” from a (faux) anti-establishment-economic-and-political-power theme to a (bizarre) law-and-order one, which I found bizarre. (I didn’t watch any of that convention, but have more than enough about what transpired.)  In Clinton’s case, the opposite is necessary: She needs to pivot away from her campaign’s raison d’être, and toward the raison that matters.

*The quote and comment about it that follow were added on 7/26 at 1:44 p.m.

**Paragraph rewritten to make sense, 7/26 at 8:10 p.m.

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Police Killings, Gender and Race

by Mike Kimel

Police Killings, Gender and Race

Police killings of unarmed Black men have garnered a lot of attention lately.  Black men are killed by police in numbers disproportionate to their share of the population.  I want to put some numbers on that issue later in the post, and those numbers run counter to conventional wisdom.  But first I want to warm up on something less controversial, though it is even more disproportionate, namely killings of police by gender.  Still, context is in order.  So here’s a little table I assembled with data from a number of sources (citations at the bottom of this post):
Figure 1 - By GenderFigure 1 – Male v. Female
What we see here is that women are disproportionately less likely to be killed by police relative to their share of the population.  Women also make a disproportionately small share of police personnel, and female police officers are far less likely to be killed in the line of duty than a male police officer.  (I.e., women are 12.2% of the total force, but 4.2% of total police officers killed.)   Women are an even lower share of cop killers; only 3.2% of people who kill police officers are women.

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The most important endorsement of Clinton other than Sanders’ and Warren’s came today … from Al Gore

Paul Waldman has a lengthy post today at the Washington Post’s Plum Line blog titled “Despite what you’ve heard, Democrats aren’t in disarray. Their party is under attack from the outside.”   He argues that the Democratic Party itself isn’t that divided, and that the divisions really are between Democrats and the outsider Sanders supporters who are trying—Sanders’ efforts to thwart it, notwithstanding—to thwart Clinton’s election.

I agree with most of what he says, but not the ultimate point that the Democrats themselves are really very divided.  Yes, he says, there certainly are many Democrats who supported Sanders and who are dissatisfied with Clinton’s level of progressiveness, but they will vote for her anyway, and that means that the party itself is not very divided.  He lists the many platform positions that were forced by Sanders, and says that is insufficient to gain the support of many Sanders supporters, but only the ones who aren’t Democrats.

He’s right about the latter point, for the most part, but not about the former.  As an ardent Sanders supporter and a Democrat, who is no Clinton fan but who nonetheless wouldn’t be caught dead not voting for her in this election, I can attest that the party is quite divided—between Clinton fans and Bernie supporters who nonetheless, like me, wouldn’t be caught dead not voting for Clinton in this election.

Sanders is one of them, although I guess he’s not really considered a Democrat.  But Elizabeth Warren is a Democrat, who clearly favored Sanders but who will do all she can to help Clinton in this election.  And Al Gore is a Democrat who, I’m guessing, favored Sanders, and who today endorsed Clinton.

He knows that earth really is in the balance in November.  And he is the most powerful living symbol imaginable of the abiding harm that the Sanders supporters who are trying to undermine Clinton want to do, and can do.

But Waldman is wrong about something else, too: his dismay that the many major platform concessions to Sanders and his supporters doesn’t satisfy the hostile Sanders supporters.  It doesn’t satisfy them not because they feel the concessions don’t go far enough—they do feel that, but then so do I—but because most of these folks fear that Clinton will backpedal on the policy concessions once in office.

But Sanders and Warren are current senators.  So is Jeff Merkley.  And Sherrod Brown.  And Dick Durbin.  And Sheldon Whitehouse and Jack Reed.  And Tammy Baldwin.  And so, hopefully, will Russell Feingold and Tammy Duckworth, and three or four others, be.  They’re revolutionaries.  And they will have real power.  But only with a Democrat in the White House.

This is one of the unremitting messages that they need to drive home.  Another is Trump’s genuine fascism.  They need to educate the public about the specifics of that—what Trump has actually said.  What he’s referring to.  What he plans.  As well as what his fiscal and regulatory plan is.

I would love to see Bernie Sanders campaign with Al Gore, and together run down the many ways this country and the world would be profoundly different had Gore rather than Bush been the one inaugurated in January 2001.  They can begin with the Supreme Court, and move on to environmental regulations.

I can’t fathom the point of trying to help elect Trump in order to bring down Wasserman Schultz’s candidate.  Least of all in the name of Bernie Sanders’ revolution—which if Clinton is elected is positioned to march through Georgia, with or without her push.  Okay, well, through Washington.

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Exponential Decay of Inflation

Yesterday, I wrote about the connection between inflation and corporate profits. (link) I posted this graph. (quarterly data since 1958 to 1st quarter 2016)

inf corp5

The graph shows how inflation drops as net corporate profits rise.

Net corporate profit rate = Corporate profits/GDP – nominal interest rate

The trend line (bright red curving downward) implies an exponential decay of inflation. We have been at the decay extreme since the crisis. Currently the net profit rate has backed off a bit from the extreme to around 6% to 7%.

 

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Trump’s Son inLaw’s paper says Putin Hacked DNC to help Trump

This is genuinely amazing (h/t @jbarro) http://observer.com/2016/07/wikileaks-dismantling-of-dnc-is-clear-attack-by-putin-on-clinton/

New York Observer is a weekly newspaper… . Since July 2006, the paper has been owned and published by the American real‑estate figure Jared Kushner.

https://en.wikipedia.org/wiki/New_York_Observerqqq

I quote without comment

It’s no secret that the DNC was recently subject to a major hack, one which independent cybersecurity experts easily assessed as being the work of Russian intelligence through previously known cut-outs. One of them, called COZY BEAR or APT 29, has used spear-phishing to gain illegal access to many private networks in the West, as well as the White House, the State Department, and the Joint Chiefs of Staff last year. Another hacking group involved in the attack on the DNC, called FANCY BEAR or APT 28, is a well-known Russian front, as I’ve previously profiled.

[skip]

 

The answer then is simple: Russian hackers working for the Kremlin cyber-pilfered the DNC then passed the purloined data, including thousands of unflattering emails, to Wikileaks, which has shown them to the world.

This, of course, means that Wikileaks is doing Moscow’s bidding and has placed itself in bed with Vladimir Putin. In response to the data-dump, the DNC has said as much and the Clinton campaign has endorsed the view that Moscow prefers Donald Trump in this election, and it’s using Wikileaks to harm Hillary. This view, considered bizarre by most people as late as last week, is being taken seriously by the White House—as it should be.

It isn’t just fringe lefty pubs like the Washington Post and the New York Times. This is in a paper owned by Trump’s son in law.

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