Friday, October 29, 2010

The “New Elite” Defined

Charles Murray is a controversial libertarian at the American Enterprise Institute, a conservative think tank. Murray believes IQ has divided America in a potentially dangerous way. Murray has been in hot water since publication of his Bell Curve in 1994, because two data-laden chapters in the book suggest, with appropriate qualifiers, that African-Americans may have lower IQs. (As Jimmie Walker would say, “Dyn-O-Mite!”)

Here’s what Murray currently says about what he calls “the New Elite”:

➢ That a New Elite has emerged over the past 30 years is not really controversial. That its members differ from former elites is not controversial.

➢ the New Elite [accepted acknowledgement of their high status] back in 1991, when Robert Reich said we had a new class of symbolic analysts in his book The Work of Nations. . . in 2000 when David Brooks took an anthropologist's eye to their exotic tribe and labeled them bourgeois bohemians in Bobos in Paradise [a]nd . . . when Richard Florida celebrated their wonderfulness in his 2002 work, The Rise of the Creative Class.

But Murray does take issue with some characterizations commonly attributed to the “New Elite”:

➢ start with the principal gateway to membership in the New Elite, the nation's most prestigious colleges and universities. In the idealized view of the meritocrats, those schools were once the bastion of the Northeastern Establishment, favoring bluebloods and the wealthy, but now they are peopled by youth from all backgrounds who have gained admittance through talent, pluck and hard work.

➢ [While o]ver the past several decades, elite schools have indeed sought out academically talented students from all backgrounds [and c]ompared with 50 years ago, the proportion of students coming from old-money families and exclusive prep schools has dropped [as] the representation of African Americans, Latinos and Asian Americans has increased[,] about four out of five students in the top tier of colleges have parents whose income, education and occupations put them in the top quarter of American families (see Joseph Soares, The Power of Privilege: Yale and America's Elite Colleges). Only about one out of 20 such students come from the bottom half of families. [emphasis added]

➢ Students who have a parent with a college degree accounted for only 55% of SAT-takers this year but got 87% of all the verbal and math scores above 700. . . a function of [their] ability . . .to do well in a challenging academic setting.

Murray says these upper middle class “brainiacs”

➢ spend school with people who are mostly just like them -- . . . ensconced in affluent suburbs from birth . . . never . . . outside the bubble of privilege. . . When they leave college, the New Elite remain in the bubble. Harvard seniors surveyed in 2007 were headed toward a small number of elite graduate schools (Harvard and Cambridge in the lead) and a small number of elite professional fields (finance and consulting were tied for top choice).

➢ [Later, their marriage announcements in the New York Times look like] the mergers of fabulous résumés. . .[C]ombining their large incomes and genius genes, [they] then produce offspring who get the benefit of both.

The deepening stratification between the New Elite and the rest of us has concerned Murray since he wrote The Bell Curve:
The more efficiently a society identifies the most able young people of both sexes, sends them to the best colleges, unleashes them into an economy that is tailor-made for people with their abilities and lets proximity take its course, the sooner a New Elite . . . becomes a class unto itself. It is by no means a closed club, as Barack Obama's example proves. But the credentials for admission are increasingly held by the children of those who are already members. An elite that passes only money to the next generation [can go] “Shirtsleeves to shirtsleeves in three generations” . . . [but a]n elite that also passes on ability is more tenacious, and the chasm between it and the rest of society widens.
Murray points out the “New Elite” clusters in a small number of cities and in selected neighborhoods in those cities--Washington, New York, Boston, Los Angeles, Silicon Valley and San Francisco, as well as university cities with ancillary high-tech jobs, such as Austin and the Raleigh-Durham-Chapel Hill triangle. And with geographical clustering goes cultural clustering.-- "Mad Men", yoga, pilates, skiing, mountain biking, backpacking in the Sierra Nevadas, an exquisite B&B overlooking Boothbay Harbor, a small ship going to the Galapagos.

Murray’s “New Elite” live in a world that doesn't intersect with mainstream America in many important ways. Jobs in businesses that provide bread-and-butter goods and services to individual Americans, which make up the overwhelming majority of entry-level openings for aspiring managers, attract, for example, just 1.7% of the Harvard students who go to work after graduation.

In his conclusion, Murray sends a neat right hook to the jaws of folks like me—and Murray himself—who think we are exempt from “New Elite” designation:
I doubt if there is much to differentiate the staff of the conservative Weekly Standard from that of the liberal New Republic, or the scholars at the American Enterprise Institute from those of the Brookings Institution, or Republican senators from Democratic ones. The bubble that encases the New Elite crosses ideological lines and includes far too many of the people who have influence, great or small, on the course of the nation. They . . . may love America, but, increasingly, they are not of it.

Wednesday, October 27, 2010

Political Suicide?

It’s not smart to insult the people whose votes you need. So what’s going on with Obama and the Democrats?

In a Washington Post column entitled “Obama the Snob,” former Bush speechwriter Michael Gerson lands on the same Obama quote I discussed here:
facts and science and argument does not seem to be winning the day all the time. . . because we're hard-wired not to always think clearly when we're scared.
Here’s how Gerson reads the President’s words:
Obama views himself as the neocortical leader -- the defender. . . of cognitive reasoning. His critics rely on their lizard brains -- the location of reptilian ritual and aggression. Some, presumably Democrats, rise above their evolutionary hard-wiring in times of social stress; others, sadly, do not.
Gerson concludes, “these are some of the most arrogant words ever uttered by an American president,” adding that Obama is “an intellectual snob.”

What especially bothers Gerson is that Obama’s superior attitude toward those who don’t support him
destroys the possibility of political dialogue. What could Obama possibly learn from voters who are embittered, confused and dominated by subconscious evolutionary fears? They have nothing to teach, nothing to offer to the superior mind.
End of debate.

The old fashioned snobs are on “Masterpiece Theater,” jokes to us because they are so full of themselves with their wealth and superior breeding, caring little what others think, as long as the others know their (inferior) place.

But how does a snob win an election, any election? Of course, British snobs didn’t have to win elections. Yet in a democracy, it’s political suicide to be a snob. Surely the easiest way for Republicans to displace America’s current ruling class is to show voters the elite looks down their collective noses at ordinary people. An easy path to power, if that’s in fact what the elite do. As in fact they do.

Tuesday, October 26, 2010

France: Sarkozy Hangs Tough

We have been following French President Nicolas Sarkozy’s fight with France’s unions. Today, the French Senate passed the final version of Sarkozy’s bill to raise the retirement age for French workers from 60 to 62, and retirement with full benefits from 65 to 67. Tomorrow, the National Assembly, where Sarkozy has a larger majority, is also expected to pass the final pension reform bill.

It’s been a long, hard struggle. As many as 3.5 million took to the streets in protest. Unions have used the streets for over a century to bring French governments to their knees, winning in this fashion as recently as 2006. (One protesting student bluntly told the New York Times that 2006 showed “everything a government does, the street can undo.”) Furthermore, Sarkozy is unpopular, with 2/3rds of the country supporting the strikers.

But when protesters escalated the struggle by striking all 12 of France’s refineries and blocking many oil depots, thereby disrupting gasoline supplies and prompting motorists into panic-buying, the unions apparently went to far. Last week, a poll found 54% of the population opposed the oil refinery blockade, while other strikes drew dwindling support day by day.

Once the new pension law goes into effect, Sarkozy will on another front provide the unions some face-saving victory. In the end, however, his symbolic curbing of union power on the pension issue could be a huge plus for long-term French reform.

Why Stocks are Up

Stocks yesterday hit their highest level in five months, close to the high that stocks reached last April, their peak since the 2008 financial crash. The Fox Index measures the gap between the current market and a healthy close for the three major indexes: 12,000 for the Dow, 1,300 for the S&P 500, and 2,500 for the NASDAQ, or a total of 15,800. The Fox Index, which reached -967 April 14, is now at -959 (see chart--the index reached its post-crash high of -927 April 15). But with unemployment remaining high and given a series of other poor economic statistics, why is the market up again?

In a word, the market’s rising in anticipation of a Republican victory in next week’s midterms. That's what CNBC’s Larry Kudlow has been saying, as have guests on CNBC anchor Maria Bartiromo’s “Closing Bell,” with Bartiromo nodding her agreement. On October 15, George Ball, Chairman of Sanders Morris Harris, said a GOP win is “priced into the market;” on October 21, Kelly King, CEO of BB&T said the election will improve the economy; and October 22, Morgan Stanley’s chief investment strategist David Darst said the market expects “a more friendly business environment” in the wake of the mid-terms that will trigger hiring, raise consumer confidence, increase housing prices, and improve retail sales.

With so much anticipation of Republican gains priced into the market, the election itself may do little to improve stocks. We shall see.

Friday, October 22, 2010

Some Overused Words: Communist, Socialist, Pinhead, Wingnut, Bigot, Idiot

Quote without further comment. From Michael Barone, writing in the Washington Examiner:

Juan Williams (2010):

“I mean, look, Bill, I’m not a bigot. You know the kind of books I’ve written about the civil rights movement in this country. But when I get on the plane, I got to tell you, if I see people who are in Muslim garb and I think, you know, they are identifying themselves first and foremost as Muslims, I get worried. I get nervous.”

Jesse Jackson (1993):

“There is nothing more painful to me at this stage in my life than to walk down the street and hear footsteps and start thinking about robbery, then look around and see somebody white and feel relieved.”

Thursday, October 21, 2010

“In the Tank” = Unacceptable Flat Growth

On the economy, U.S. News & World Report’s Mort Zuckerman accentuates the negative. His fellow publisher, Rich Karlgaard at Forbes, is more upbeat. Karlgaard points out that in the Great Recession, the GDP in 2008, 2009 and (projected) 2010, was (and is), $14.3 trillion, $14.2 trillion and $14.6 trillion. That’s not growth, but it’s not recession either—it’s just staying flat. The problem is that with a growing population, America needs growth; Karlgaard says 3.3% a year, the post-World War II historical average. We can’t settle for Europe’s 2% annual growth, and certainly not for less than that.

But how do we sustain an annual GDP growth rate of 3.3%? Karlgaard quotes Carl Schramm, head of the Kauffman Foundation, who says:
The single most important contributor to a nation’s economic growth is the number of startups that grow to a billion dollars in revenue within 20 years.

The “X-factor” is startups that get big. And Schramm says the large U.S. economy needs to spawn around 100 eventual billion-dollar companies per year to keep annual GDP growth at 3.3%.

So how do we spawn that many “billion dollar babies”? Karlgaard says begin by removing the tax and regulatory barriers we place in the path of startups that have the potential to scale. And then, in words that are absolute music to my ears—every word as written, word for word—Karlgaard says:
any immigrant who graduates from a U.S. university should get a green card along with his/her diploma. So should any immigrant who starts a business that grows to more than 5 people on the payroll. Ambitious immigrants, disproportionately, create growth companies.

Yes! We can!

Wednesday, October 20, 2010

The U.S. Economy: In the Tank

Mort Zuckerman is editor-in chief of U.S. News & World Report. His political contributions go to Democrats and independents, not Republicans. Nevertheless, Zuckerman has done a good job of mixing together statistics that paint an appropriately bleak picture of where the U.S. economy stands today:

➢ 1 in every 10 American homeowners missed a mortgage payment in the first quarter, a record; roughly 1 in 6 Americans are either unemployed or underemployed or have left the labor force; over 4 in 10 unemployed Americans have been out of work for at least six months; 1 in 4 Americans with a mortgage have negative equity in their homes.

➢ the consumer confidence index remains near or below its lows of the previous four recessions. Household debt, which was about 30% in relation to disposable income in 1950 and went to 60% in 1970, is now 125%. And it might take as long as a decade to return to the earlier, safer range.

➢ Normally in two-plus years after a recession starts, nominal GDP is in double figures and real GDP is up by 7½%. Currently, nominal GDP is up slightly over 1% and real GDP is down from pre-recession peaks. By some key measures, this is the weakest recovery ever—and as for employment, housing, and personal income, there has been no recovery at all. [emphasis added]

The U.S. today. “No recovery.”

Monday, October 18, 2010

The People’s Chamber

our politics seems so tough right now and facts and science and argument does not seem to be winning the day all the time . . . because we're hardwired not to always think clearly when we're scared.

--President Obama, 10.16.10

Micky Kaus, in Newsweek, notes how close Obama’s words are to his most disastrous comment from the 2008 campaign, when he said Pennsylvanians “cling to guns and God” out of fear. Kaus rightly makes the comparison—Obama in two elections warning to watch out for voters who are afraid, and twice slighting voters in the process. But what gets my attention is Obama’s pronouncement that “facts and science and argument does not seem to be winning.”

[Picture: Democratic House Speaker John Nance Garner (1931-33), later (1933-41) Franklin Roosevelt’s vice president.] Since 1930, a period of 80 (“four score”) years, the Democratic thinking party, the one with the brains and with “facts and science and argument” on its side, has not only dominated the intellectual life of America, it has with few exceptions controlled the U.S. House of Representatives, “the people’s chamber“.

Even when our intellectuals/Democratic Party failed to control the White House or the Senate, it was comforting for them to know the House remained Democratic. That meant the people symbolically endorsed leadership by their betters, Democrats steeped in “facts and science and argument.” In 1946, when post-war hyperinflation and related strikes for higher wages swept the country, and in 1952, when the nation elected Eisenhower and Republicans after Democrats gave us the Korean War and (again) inflation, the House did pass briefly out of Democratic hands. But both times, Democrats were back in control within two years.

The only major break in Democratic domination of the “people’s chamber” occurred from 1994 to 2006. Republicans argued that as liberal intellectuals gained full control over the Democratic Party, the people responded by voting Republican six successive times. The national elite, led by the media, went all-out to disprove any assertion that the people had left Democrats behind; they saw loss of the House as a temporary aberration. ABC anchor Peter Jennings said of the 1994 GOP take-over of Congress, “The voters had a temper tantrum last week... Parenting and governing don't have to be dirty words: the nation can't be run by an angry two-year-old."

As I have written, after the 1994 election and the Republican Speaker Newt Gingrich-led shut-down of government in December 1995, the media dropped their “plague on both your houses” approach to persons in power. Media worked to change the landscape back to "normal" Democratic control by successively demonizing Republicans Gingrich, Impeachment Independent Counsel Ken Starr, and especially President George W. Bush over the next decade, succeeding when Democrats recaptured Congress in 2006. Democrats believe that in the aftermath of 9.11, Republicans delayed the rightful restoration of power to the party of “facts and science and argument” by demagoging “the war on terror” in both the 2002 and 2004 elections.

But underneath, the liberal/media elite do worry the national majority may no longer be with Democrats. Look at how Time's Joe Klein riles against the “classic American myth, perpetrated by Hollywood . . .with 'Mr. Smith Goes to Washington'", of the “inspired amateur” who “actually read[s] the bills he was about to vote on, then mak[es] up his own mind.” To Klein, Jimmy Stewart ("Mr. Smith") is “a lovely fantasy.” The reality is Republican senate candidate Christine O'Donnell of Delaware:
attractive, to some, because she doesn't know anything. She couldn't . . . ever be confused with a member of the elites; there is no way she could be confused with an above average high school student. Her ignorance. . . makes her authentic-- the holy grail of latter-day American politics: she's a real person, not like those phony politicians. In that sense, she—[along] with other Tea Party know-nothings--follow in the wake of our leading exemplar of ignorant authenticity, Sarah Palin.

Klein's article drips with condescension. We are witnessing the masses taking over from their betters, and he doesn't like it. Klein's rejects majority rule replacing rule by a superior minority, the same elite rule justification for holding power we earlier found "Slate's" Jacob Weisberg defending. To Klein,"There is something profoundly diseased about a society that idolizes its ignoramuses and disdains its experts. It is a society that no longer takes itself seriously."

More insults aimed at both Republicans and the population supporting them.

Going into this election, the question before us seems clear. Are we better off when big government, controlled by an elite blessed with “facts and science and argument,” gathers our resources and makes the decisions for the rest of us that create or don't create jobs? The answer seems equally clear: "No." Time for the people to reclaim their chamber.

Wednesday, October 13, 2010

Sun Setting on Union Power?

Michelle Rhee is out as Washington D.C. school superintendent. I’ve had real trouble calling the twists and turns of Rhee’s tenure; this one I got right. And no mistaking the reason Rhee’s out—the teachers’ union won its struggle with Rhee and her boss, D.C. Mayor Adrian Fenty, who lost his re-election bid.

But is the D.C. teachers’ union victory Pyrrhic? Are people finally waking up to public sector union power? Charles Krauthammer, speaking on "Fox News," thinks so. He said of Rhee's forced resignation:
the major issue that is coming up in the next year or two, the next decade is going to be the power, the reach, the benefits that the public sector unions have, including the teachers union. And when people learn about that, I think it’s going to be a major issue of our time. And its coming and [Michelle Rhee's forced departure] is one example of it, the power it has and how it hurts the country.

David Brooks in the New York Times writes about “demosclerosis,” governments draining money from productive uses such as building tunnels and supporting education to fund unproductive ones instead, such as New Jersey’s benefits packages for state employees 41% more expensive than those of the average Fortune 500 company, with costs rising by 16% a year, New York City’s supporting 10,000 former cops who have retired before age 50, and California’s state cops receiving 90% of their salaries when they retire at 50. States face unfunded pension obligations that, if counted accurately, amount to $2 trillion — or $87,000 per plan participant.

Brooks says governments can’t promote prosperity or help schools adequately because of union self-indulgence. While private sector managers have to compete in the marketplace, Brooks writes, government managers possess a monopoly on their services and have little incentive to resist union demands that make them unpopular. Elected leaders raise state employee salaries in fat years and jack up future pension benefits in the lean ones. And public sector unions even buy their benefits directly: between 1989 ad 2004, the American Federation of State, County and Municipal Employees, the biggest spender in American politics, gave $40 million to federal candidates.

Brooks calls the end result “sclerotic government.” It's the Democratic Party’s “epic failure.” The Democratic Party “has become captured by the unions. Liberal activism has become paralyzed by its own special interests.” Therefore, we no longer have government “that is nimble, tough-minded and effective.”

Still, it’s possible this all might change. The Washington Post’s Steven Pearlstein describes a remarkable contract worked out between government-owned General Motors and its close ally, the United Auto Workers, that has saved 1,550 jobs in GM’s Orion plant that would have otherwise gone to South Korea to build the new GM sub-compact. The UAW has agreed to a two-tiered contract with its 60% most senior employees receiving $28 an hour, but the bottom 40% earning only $14 an hour. That enables GM to build the car in the U.S., employing American workers, producing a product that can be priced competitively. The alternative: lose your job.

And that’s exactly what’s happening at an Indianapolis GM stamping plant. It’s slated for closure next year after workers rejected a similar two-tier pay settlement, out of fear the idea would spread throughout the industry (which will in fact happen). So the Indianapolis workers lose their jobs! As Pearlstein says, “a better alternative to layoffs is to cut everyone's hours and pay and spread the pain more widely.” Instead of high unemployment, we need “creative new wage structures that will allow us to better spread the burden of getting the economy back into balance.”

Business leads the way. Government needs to follow. Employees should work for less pay and smaller benefits, giving government the resources it needs to do the work that matters most.

It’s way past high noon for union power in America. With union givebacks, we can help business and government work better while at the same time saving jobs.

Monday, October 11, 2010

Rebirth of American Exceptionalism

Chinese friends chide me for overidealizing China. I tell them: “Guilty as charged.” . .China. . . has regular rotations of power at the top and a strong record of promoting on merit, so the average senior official is quite competent. Listening to Prime Minister Wen Jiabao of China tick off growth statistics in his speech here had the feel of a soulless corporate earnings report. Yet he has detailed plans for his people’s betterment, from universities to high-speed rail, and he’s delivering on them.

--Thomas Friedman, 9.21.10

In a nutshell, Friedman admires China because its meritocracy has nearly unchecked power. America by contrast (here Friedman quotes China expert Orville Schell) finds itself “so unable to get things done,” missing "fearfully . . . that ‘can-do,’ ‘get-it-done,’ ‘everyone-pull-together,’ ‘whatever-it-takes’ attitude that built our highways, dams and put a man on the moon. . .hallmarks of our childhood culture.” Sigh. Big Government programs that worked, childhood days of “The Blue Model” Big Government-Big Business-Big Labor, everything (?) working, Democrats in charge.

Democrats like Friedman and Schell are implicitly admitting that Big Government under Obama hasn’t worked, though Friedman blames not the President, but “our poll-driven, toxically partisan, cable-TV-addicted, money-corrupted political class.” He wants more meritocracy, not less. Friedman wants the China Model, a nation led by the exam-tested best and brightest, the modern version of China’s imperial bureaucracy, its scholar gentry. He wants what we have under Obama, only more.

Well, it’s not to be. Americans are on the verge of rejecting the American ruling class, and the big government-run economy upon which our rulers have placed their faith. Politics is about power. Republicans say wise use of power maintains a framework for business to succeed, because business and only business creates jobs, and because jobs are crucial if individuals and families are to enjoy “life, liberty, and the pursuit of happiness.” The ruling class wants power in the hands of our national elite, our best and brightest, who will create for us the jobs we need to enjoy happiness.

But the elite has had its two years and the elite has failed. We are now more certain than we were when Reagan became president in 1980, and more certain than when Republicans captured Congress in 1994, that social evolution leads a society away from top-down, ever bigger institutions toward an economy where government steps back and allows the creative genius of millions of Americans, many who score poorly on written examinations but who learn from experience, to build jobs from the bottom up. That’s what democracy is about—treating everybody as equally capable of succeeding, allowing those who both work harder and who are luckier to succeed, and benefiting from the jobs their success creates.

Democracy and free enterprise go together. Each relies on the innate worth of every individual. Neither blesses rule by a superior elite. We are not China. A level playing field, open competition, and the rewards of success built the greatest nation on earth. Pulling government back, pushing our underperforming elite out of the way, these two power shifts will once more allow America to get back to greatness, greatness that will benefit the world’s peoples wherever they live.

Thursday, October 07, 2010

Government Party at the Ramparts

those. . . who believed that government could solve intransigent problems, are not only disappointed but dispirited. Obama's faithful never believed in the dynamism of the private sector, only in its corruption. They never trusted Bush except to do favors for Halliburton. . . Now even that audience is waking up to . . . a world where government cannot create wealth, but only consume it.

--Hugh Hewitt, Washington Examiner, 9.26.10

Politics is who gets what, when, and how.

--Harold Lasswell (1935)

What Jared Diamond bluntly calls a “kleptocracy,” government gets in the way of people going about their business, best understood as a farm family raising the crops that will feed, house, and clothe its members. Government, performing no farm work of its own, steals from farmers to pay for its existence.

Lasswell’s classic definition of politics needs another look. Are we happy to have “politics” (government) in the picture? Do we want someone else telling us “who gets what, when, and how”? No, especially when it comes to decisions best made by a free market. We need a working free market to create and keep jobs, and nothing’s more important to the future of American families than jobs.

Get politics out of the way! Let free markets work!

Of course, government should, as the Preamble to our constitution says, “establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare, and secure the blessings of liberty.” It has a big role in providing the infrastructure—physical and social, including education—needed for growth and prosperity.

But the principal lesson of the 20th Century is that when it comes to running the economy, hand the ball to the private sector, not to government. Government screws it up, every time.

Given what happened in the former Soviet Union, in Maoist China, in Eastern Europe, in Vietnam before 1987, in Cuba, in the U.K. before Thatcher and Blair, and in many other social-democratic countries including Australia, New Zealand, Germany, France, Brazil, and India, as well as in the U.S. under Jimmy Carter, why is the U.S. once again reaching for Big Government? Don’t we ever learn?

“We” might. “They” don’t, or at least “they” don’t give up. “They” are the people who benefit from a large and growing government, even if its growth comes at the expense of prosperity for all of us, including their children. And let there be no confusion on this point: “They” is the Democratic Party. Democrats and Big Government are by now almost a complete identity. If you like government, you are a Democrat. If not, no.

Here are the folks who identify with the Democratic/Government party, and why:

The Ruling Class: It used to be Republican, rich, land-based, the American aristocracy. Being “Republican” was a way to identify with those who had the wealth and the (derivative) power. But what Arthur Schlesinger, Jr. called “the Old Order“ failed us in the Great Depression. That failure led to the New Deal-Fair Deal-New Frontier-Great Society era (1933-68), what Walter Russell Mead calls “the Blue Model”--big government, big business, and big labor working together under Democratic leadership, with government in charge; big business and Republicans following as junior partners. Vietnam blew up “the Blue Model,” creating enough anarchy and chaos to have us looking to Uncle Walter Cronkite and the national media for guidance. Media power helped encourage the high-SAT score, liberal elite take-over of our country under a reformed Democratic Party, the champion of women, minorities, and others who benefit from government power. When the “Old Order” lost its 1960s battle to place unqualified alumni children into Harvard, Princeton, and Berkeley, it foreshadowed the ruling class transition from money to credentials. Intellectual take-over of the rest of America’s elite institutions—the media, government, non-profits, arts and entertainment, finance, and big business (but not the military or small business)—then followed. As with all ruling classes everywhere, the American liberal elite is obsessed with protecting its existing power.

Government Workers: Government unions are such a large share of the Democratic Party it’s impossible to separate them. And Democrats have gone so far toward rewarding government workers at the expense of the rest of us that state and local government workers earn 44% more than do private-sector workers, and federal government employee compensation more than doubles that of private-sector workers. In many states including California, pension rewards for government work are so high they threaten to bankrupt the rest of government.

Transfer Payment Beneficiaries: Besides those working for the government, additional millions benefit from government transfer payments. By now (the share grows annually), 18% of personal income comes from government benefits, 10% from government wages, and only 42% from private sector wages.

Blacks, Other Minorities, Unmarried Women
: These are the Democratic Party’s core constituencies. Republicans pursued a “Southern Strategy” that won them the White House for all but four years between 1968 and 1992. Whites unhappy with civil rights or affirmative action knew which party listened to their concerns—Republicans—and a white majority voted accordingly. The strategy has cost Republicans; they have trouble reaching the moderate to conservative minority voters alienated by ethnicity from Republicans. Unmarried women, who likewise welcomed government protection against the male-dominated “Old Order” that prevailed under Republicans, themselves vote heavily Democratic. Unmarried women not only value the government programs Democrats have enacted on their behalf, they also appreciate that Democrats defend a woman’s right to choose.

The Media: Why are the media so favorable to government-based, as opposed to private sector-based solutions, even when the issue is job creation? First, government is the vehicle through which any media outlet works. The media see themselves as the people's voice, and government as the people’s servant. The media therefore have no problem with government regulating, taxing, and controlling business on behalf of the people. Second, since they ended the Vietnam War and overthrew two presidents (Johnson because of Vietnam, Nixon through Watergate) in 1968-74, the media have dictated the national agenda, as executed by Democrats through government. Democrats appreciate all the media have done for the party; both sides work well together.

Academia: Like the media, academia wants to do good for the people, and that logically involves influencing government to enact new programs that help people. Academics believe in social justice, with government the instrument for achieving justice. The enemy would be private sector businesses pursuing profit at the people’s expense. So academics work for Democrats and against Republicans for a better society. Also, Democrats are more inclined to fund academic research, and to raise taxes to do so.

Non-profits: The profile of a non-profit worker looks much like that of an academic: successful in school, seeking influence through words and data, seeing government as the ultimate target, with the objective of launching or expanding a government program that will benefit the public. Democrats, the party of government, understand all this, and Republicans tend not to. Also, government funds much of non-profit work.

Arts and Entertainment: Though part of the private sector, artists and entertainers generally feel alienated from the world of business and profits. They want to do good on behalf of the people. As with the media, artists and entertainers believe working with Democrats in government is the best way to help people. Artists and entertainers aren’t necessarily graduates of top universities or sometimes any university, although high-tech arts and entertainment is brain work. Entertainers more classically rise to the top through raw talent, measured by wealth. Nice then that when they arrive, they find an elite sharing their pro-government Democratic ideology. (Starving artists naturally have even less problem identifying with government, whose programs aid the temporarily unemployed.)

Trial Lawyers: The constitution guarantees persons a fair trial with an adequate defense, and the “plaintiffs bar,” working through the large share of elected officials who are lawyers and through a Democratic Party heavily funded by trial lawyers, has written a sea of laws favorable to large settlements that make lawyers rich at the expense of legitimate business and most of the law-abiding public, who pay higher insurance rates and prices as a result. Trial lawyers sometimes work with the media, arts and entertainment, and government to take down our worst corporations.

These millions make up the Government Party. When it comes time to downsize government, the government party armies will be expected to fight back hard, very hard.

Wednesday, October 06, 2010

Shocking Revelation: Liberal Admits to Liberal Elite Rule

Jacob Weisberg, in his “Slate” article “Elitist Nonsense,” provides amazing insight into how the elite sees itself. No surprise, Weisberg begins his discussion of America’s elite by reaching for sociologist C. Wright Mills’ (The Power Elite, 1956) classical definition: a “shared identity based on economic interests.” Weisberg first sets an elite based on money against how Republicans define elite, whom Weisberg mockingly says give it
connotations of education, geography, ideology, taste, and lifestyle—such that a millionaire investment banker who works for Goldman Sachs, went to Harvard, and reads the New York Times is an elitist but a billionaire CEO who grew up in Houston, went to a state university, and contributes to Republicans, is not.

Weisberg is amused by how John McCain handled NBC anchor Brian Williams’ 2008 campaign question, "Who is a member of the elite?" McCain replied, "I know where a lot of them live—in our nation's capital and New York City—the ones [Palin] never went to a cocktail party with in Georgetown—who think that they can dictate what they believe to America rather than let Americans decide for themselves."

Weisberg adds, “Thus did the son and grandson of admirals, a millionaire who couldn't remember how many houses he owned, accuse his mixed-race opponent, raised by a single-mother and only a few years past paying off his student loans, of being the real elite candidate in the campaign.”

Weisberg thinks it’s funny for a rich man to think he’s not in the elite. But to me, McCain is talking about today’s “power elite”, a group at the top who believe they have the right to rule over the rest of us. When McCain picked Sarah Palin as his vice president candidate, he said pretty clearly he didn’t buy the “elite should rule” idea. Maybe that helps explain why the elite then went crazy.

Looking further at McCain, Palin, and other Republican leaders, Weisberg refines his version of what Republicans call the elite:

➢ social snobbery. . . not based on family, ethnicity, or wealth, but rather on the status that in contemporary American society is largely conferred by academic institutions.

➢ someone who thinks the opinion of a minority should sometimes prevail over the opinion of a majority.

Of course, a Republican would say America’s elite doesn’t think ruling class opinion should prevail over the majority only “sometimes”—“sometimes” is for sure Weisberg’s very own modifier. Erase “sometimes,” and Weisberg is pretty much onto the Republican definition—“elite”: a well-credentialed group at the top reaching across government, academia, the media, non-profits, arts, entertainment, business and finance that believes it should rule because it is certifiably better than the rest of us.

Weisberg concedes the Republican definition of elite packs a political punch, admitting that when liberals act superior, that cuts against the American ideal of social equality. And Weisberg, by flatly describing America as “a meritocratic society,” makes the biggest concession of all to the Republican definition of elite—what else is our academically-credentialed elite but a “meritocracy”? Weisberg understands what’s wrong with an elite based on academics—it brings “an even worse sting than under an aristocratic or hereditary one, because those who are less successful can't blame outcomes on the arbitrariness of the system.”

In fact as his argument rolls along, Weisberg grows increasingly comfortable with being part of the elite Republicans oppose. He quotes ultra-Tory Edmund Burke’s defense of elite rule, his famous principle that elected legislators owe their constituents their best judgments; they cannot just be conduits for majority opinion. In the same vein, Weisberg defends expert rule and attacks popular referenda (“I'd rather have a nuclear-energy policy set by Nobel Laureate Steven Chu of Berkeley than by a plebiscite.” [emphasis added]). By the end, Weisberg writes he actually has no “problem” with the Republican definition of elite!!!

So what is Weisberg’s “problem”? He believes Republicans are just as willing as liberals to “adopt superior stances” or “tell people how to live their lives.” They insist “that gay people not be married, or that some go without health insurance, or that gas be lightly taxed.”

Is that it, really? It seems to me a majority of Americans favor the policies to which Weisberg and his elite object, and in a democracy, where the majority rules, that’s a pretty important difference.

In sum, Weisberg tells us:

Democrats are the party of the elite (and we’re lucky to have them).

Republicans are the party of the majority, unwashed as it may be.

An important admission indeed.

Monday, October 04, 2010

Writers to America: “You folks are ill!”

Sometime long ago, a writer by the side of Walden Pond decided that middle-class Americans may seem happy and successful on the outside, but deep down they are leading lives of quiet desperation. This message caught on (it’s flattering to writers and other dissidents), and it became the basis of nearly every depiction of small-town and suburban America since.

--David Brooks, 9.21.10

Brooks’ comment comes from his informal review of Jonathan Franzen’s Freedom, a book that drew much attention when President Obama made it part of his Martha’s Vineyard summer reading this past August (it’s now #1 on the New York Times’ fiction bestseller list). Is it fair to say multi-book author Obama may share a perspective on the American middle class that parallels that of writer Franzen and Walden Pond’s Henry David Thoreau? He did say of small town people in Pennsylvania and the Midwest (the setting for Franzen’s Freedom), “they get bitter, they cling to guns or religion or antipathy to people who aren’t like them or anti-immigrant sentiment or anti-trade sentiment as a way to explain their frustrations.”

I’m with Brooks’ implicit message; writers don’t “get” middle class love of America and its freedom. The writers would paraphrase Tolstoy—who famously opened Anna Karenina with the words, “Happy families are all alike; every unhappy family is unhappy in its own way.”— by arguing, “Seemingly happy middle class Americans are outwardly boring; inwardly quietly desperate.” Writers can’t write happy American middle class. So that fact sets writers against the people who make America go, but don’t have time to write. That means folks who read fiction about our middle class aren’t gaining the understanding they should about the people who decide American elections and who thereby rule.