That Fight is Ours Too…

Politics in the United States is not the obvious place to look for inspiration at the moment however Senator Elizabeth Warren’s book “This Fight is Our Fight: The Battle to Save Working People” is like a shaft of light in  a dark cave. Ms Warren is the senior US senator for Massachusetts and a Democrat. Her book provides an analysis of how the US has been transformed over the past four decades from a nation characterised by a stable and growing middle class optimistic about its future to a society riven with insecurity and fear.

She is a genuine patriot, particularly proud of the amazing growth of the middle class in the states following the Great Depression driven by FD Roosevelt’s government which took on the multi-millionaires of the time. Promoting trade unions, breaking monopolistic practices, regulating competition, investing in education for all and creating a nascent welfare state.

Warren BookAll of this meant that over the period from 1935 to 1980 some 70% of all the income growth went to the bottom 90% of the population and 30% went to the top 10%. It meant that an enormous middle class was created whose experience was of steady employment, with good pensions to look forward to and a faith their children would be able to build on the foundations they had laid and gain a better future through education and their own efforts.

Do not think Ms Warren looks back through rose tinted spectacles however, at “the good old days”. Her personal experience as a child of how precarious existence could be when her father had a heart attack and could not work prevents that. When her mother became the only breadwinner in the house and got a minimum wage job at Sears things were tight, however, in the mid 1960’s, that one minimum wage kept a family of three afloat paying the mortgage and keeping food on the table.

It is not that everything back then was perfect, it was just that there was a sense the arc of history was bending in the right direction. Since then however the arc of history has been pushed in a different direction. Whilst the cost of living has increased significantly the value of the minimum wage has plummeted in real terms and the idea that a single minimum wage, could keep a family of three afloat is laughable. The current Federal minimum being $7.25 although in many states higher rates are paid up to $15 (£9) per hour. Worse, median wages have stagnated so that over a thirty year period working Americans have seen virtually no real increase in their pay. Why is this?

One of the reasons is that in the period since 1980 to 2015 the income growth of the country mentioned above got shared out differently. The amount received by the bottom 90% was a large round number – zero. And for those who struggle with maths this means the top 10% have taken 100% of the growth. How could that happen?

Well not by accident. Back in those crazy communist days of the 1960’s the 10% started to become discontent with the mere 30% of the wealth they received. This discontent was channelled in 1971 by a confidential memo written by a corporate lawyer named Lewis Powell which was essentially a call to the rich to transform themselves in to the rich and powerful.

To do this they were encouraged to invest their wealth in gaining control of the political agenda. Whilst this included funding supportive politicians in increasingly costly election campaigns it was more insidiously about capturing the realm of ideas. To do this they should fund research, think tanks, media shows, anything which promoted their ideas. Ideas which could be boiled down to low taxes for the rich and an ever reduced role for the state in the provision of services, regulation and, worst of all, transfer payments.

Ms Warren draws on her own experience and that of a number of individuals to illustrate what that process has done to people and their life chances. She talks about Gina, the woman whose family income has halved over the past 20 years from $70k to $35k. “No crisis. No Accident. No tale of woe. Juts the grinding wear and tear of an economy that doesn’t work for families like Gina’s”

She talks about Kai a young woman who worked hard through school and wanted to work in design. She paid to go to a private University but after the first year could not afford the fees so decided to return to her home state and complete her degree there only to find the credits from the Private University were not recognised so had to repeat a year. The upshot is she now has $90k of the $1.4 trillion US student loan debt and is repaying it out of her job as a waitress.

Finally, Michael who worked hard at his job at DHL for 16 years securing a house with  a mortgage and what he though was a solid middle class life ahead. Then 2008, DHL eliminated 14,900 jobs including Michael’s. He then got a call asking if he wanted his old job back. Not his full time job with benefits though, a part time job with no guaranteed hours and no benefits. He had to take on two jobs but even then he could not pay the penalous mortgage he had been mis-sold so lost his home.

Even then he did not give up but just kept on eking out jobs here and there until he got work in a Nabisco factory putting the cream in Oreos. Just when he thought he was getting back on his feet the factory was closed and production relocated to Mexico.

The real life stories of individuals trying to live up to the myth that hard work is all that is needed to secure a reasonable living are heartbreaking. They translate debates about trade deals, de-regulation and labour rights into a increasingly depressing reality for millions of American. As “the economy” and Wall Street does well and the stock market booms the 90% get left further and further behind.

Ms Warren is under no illusion about the implications for working people of a Trump presidency backed by a Republican Congress. However she draws strength from the millions of Americans who want to stand up against bigotry, for a fairer economy and most of all for Democracy. Her battle for Democracy has implications far beyond the States. Democracy there has been infected most by the “greenback virus” but it is happening in many other places including the UK where election expense rules are starting to be challenged by being ignored. We have a common interest in Ms Warrens fight.

If this book is a kite being flown to test support for a 2020 campaign run it gets my vote. Ms Warren comes across as intelligent, incisive, authentic but most of all humane. If voters want a choice of opposites in the 2020 election she would provide it.

 

Elizabeth Warren. This Fight is Our Fight: The Battle to Save Working People. Harper Collins. 2017.

Dark Money

Dark Money by Jane Mayer covers a period from the early 1970’s to the run up to the Trump election. It documents in meticulous detail the amount of money spent over the period by super rich Americans, not just to secure the election of politicians  supportive of their radical libertarian views but more insidiously to shift the terms of political debate to the right.

DMThe process begins in the late 1960’s early 70’s when a number of very wealthy Americans began to fear the US was about to succumb to socialism. It may seem unbelievable now but looking back it was a time of radical foment, the rights of black Americans were being fought for, a nascent women’s rights movement was emerging, young people’s opposition to the Vietnam war resulted in 4 students being shot and killed in a protest at Kent State University.

Whilst all this protest were real worries to many on the right there were other issues about the role of the state that were of perhaps of more profound concern. The Democratic President Lyndon Baines Johnson had initiated a War on Poverty. Worse however was a proposal by Republican President Richard Milhous Nixon to create a modest basic income, an idea about which there is currently renewed interest.

In 1970 the Family Assistance Plan passed through Congress with a healthy majority but was lost in the Senate to Democratic opposition that it was not radical enough. At the time it was said “This bill represents the most extensive, expensive and expansive welfare legislation ever handled.” Not only was their bipartisan support for this proposed legislation, but it was supported by 90% of the press and popular in the country.

For some, all of this represented an unwarranted intervention by the state in the operation of the market economy. An intervention that would expand the role of the state, require increased taxation and thus impact directly on the fortunes of the very wealthy. Some decided it was time time to act.

Ms Mayer’s book focuses primarily on the brothers Charles and David Koch. The brothers engaged in active politics in the 1970’s providing financial support to the Libertarian Party. In 1980 David Koch ran as the running mate to the party’s Presidential candidate, Ed Clark who was challenging Ronald Reagan, from the right. They got 1% of the vote. From this point on the Koch’s receded from public view and over the next three decades according to Ms Mayer gave well in excess of $100m “…to dozens of seemingly independent organisations aimed at advancing their radical ideas.”

The book charts how the brothers “weaponised philanthropy”, maximising the tax benefits of establishing charitable trusts, thus avoiding inheritance tax, and then using the money from the trusts to support a series of educational and social welfare groups to promote their libertarian viewpoint. Over the years a variety of think tanks were established or supported all with the aim of ensuring that conservative ideas were made respectable.

Over time the thinking evolved and there was a recognition that in order to change opinions the elite educational institutions of the US had to be “penetrated”. This led to the “beach head” theory which was about establishing conservative beach heads at “…the most influential schools in order to gain maximum leverage.” By 2015 the Charles Koch Foundation was “subsidising pro-business, anti-regulatory and anti-tax programmes in 307 different institutions of higher education in America.” Interestingly the book reports a comment about the Golden Rule of philanthropic giving – those with the gold, rule. This was taken to a higher level when a donation of $965,000 to West Virginia University by the Charles Koch foundation came with strings. The foundation was to have a say over the professors it funded, fundamentally undermining academic independence.

The Koch’s were not alone in this enterprise but they did, and continue, to play a major co-ordinating role such that at one point the sprawling breadth of their influence in right wing political promotion was described as Kochtopussy. Ms Mayer’s book makes clear that this was not the outcome of a series of more or less random individual initiatives. Rather it was an evolving, but very conscious, political strategy to move the political goal posts. It responded to a very clear cri de coeur set out in a memo by Lewis Powell in the late 1970’s urging American capitalists to wage “guerrilla warfare” against those he saw as trying to insidiously undermine them. Ms Mayer claims his call to arms inspired some of the super rich, “to weaponise their philanthropic giving in order to fight a multi-front war of influence over American political thought.”

You may wonder whether these people were driven by a bizarre but genuine belief in radical libertarianism, where the state, taxes and regulation were perceived as demeaning constraints on the freedom of the individual. In truth their idealism was always tempered by a strong regard for their personal advantage. When congress was considering the Troubled Assets Relief Progamme (TARP) the Koch’s and their radical caucus were opposed to the massive package of  state support. This changed however when the stock market started to tank. Suddenly their wealth was at risk and opposition to the TARP was dropped.

Another fascinating insight into the motivation of the Koch brothers comes from a post mortem conducted into the right’s failure to prevent a second Obama term at one of their annual seminars. Arthur Brooks, President of the American Enterprise Institute funded generously by the Koch brothers, made the point that if the 1% want to win control of America, “… they needed to rebrand themselves as champions of the other 99%”. This theme was built on in 2014 in a paper that Richard Fink, Charles Koch’s “grand strategist”, gave to a meeting of one of their annual seminars of the libertarian super rich. The paper was entitled “The Long Term Strategy: Engaging the Middle Third”. In a perfectly candid way Fink asked the question, “We want to decrease regulations. Why?” he then answered his own question, “It’s because we can make more profit, okay?.”

One third of the electorate who were perceived as solidly on the side of the libertarians, another third never would be. This mean the battleground was about gaining the trust of the middle third. To do this it would be necessary to convince the them that libertarian intent was virtuous. “We’ve got to convince these people we mean well and that we are good people.”

Following a Supreme Court decision in 2010 known as Citizens United it was found that corporations had the same rights to freedom of speech as individuals. This overturned a century of restrictions banning corporations and unions from spending all they wanted on the election of candidates. This opened the floodgates to political spending to support congressmen and senators and the Koch Brothers took maximum advantage building a real power base which was in but not of the Republican Party.

In 2014 the Koch network invested $100m into House and Senate races for the GOP plus almost twice as much into other kinds of activism. The result was they won full control of both. Their aim was to spend $889m in the 2016 presidential race. Whilst they could not legislate for the Trump wildcard the first attempt to replace Obamacare was such a shambles because of the intransigence of the right wing caucus within the Republican Party largely made up of Koch supported Congressmen and Senators who thought the Trump proposal was too generous!

Dark Money is a sobering work which casts an unflinching light on the very private world of the super rich in America and specifically on the brothers David and Charles Koch estimated to be worth $41.6bn each. It raises all kinds of issue about the role of multi-billionaires in undermining democracy in America and reinforcing a process which is concentrating ever more power and wealth in the hands of a smaller and smaller group of super rich plutocrats.

The influence of the Koch brothers, and many others of the same ilk, is not confined to the States however. They have played a part in shifting the terms of political debate across the whole of the developed world, dragging the centre of politics so far to the right that people like Richard Nixon look like lefty softies. If one thinks about how a proposal to increase taxes on the rich in Britain today would be greeted it is a testament to how far the super rich have captured common sense and shaped it to their benefit.

This is a book that should be read widely. It’s scale will probably prevent this which is a real shame. It is a tremendous summary of a long and sustained process of the exercise of soft power through the expenditure of vast amounts of private money. If the process is not stopped it will ultimately undermine democracy.

Dark Money. Jane Mayer. Scribe Publications 2016

 

 

 

President as C E Ohhh!

Many of those that elected President Trump voted for him because he was a business man. They thought if he could run a successful business empire, 4 bankruptcies notwithstanding, he should have transferable skills to run the country efficiently. The case is often made that people successful in business will almost certainly be better at running government than career politicians and it is clear President Trump believes this also.

Whilst there may be superficial similarities and some overlapping skill sets, such as managing people and negotiating there are profound differences which in truth mean the two jobs are not just quantitively different they are qualitatively different as well.

Firstly, there is a level of accountability in government that is far in excess of that of both public and private companies. It is one thing to give a motivational speech at the staff conference to a group of people who’s careers depend in large part on your view of them. It is a wholly different issue to have your every utterance picked over by your peers who have a career interest in demonstrating that what you are doing is wrong.

The relative power and ability to challenge of, on the one hand, staff, customers and shareholders and on the other Congress, pressure groups and the media is immense. In the former case the executive has an information resource which translates into a real power advantage. In the latter it may often be the case that citizens, think tanks and pressure groups are much more informed about an issue than the President. Worse they can demonstrate in public his ignorance.

There is also an important difference in the relationship between means and ends. In most businesses there is a fairly well defined objective in terms of growth and profit. There may be debates about how this is achieved but those debates are largely within a relative well defined area. In politics the ends are often in question and the means so diverse and contested as to reignite challenge as to the nature of the ends.

Another huge difference lies in relation to the transparency of the processes of government and business. Even where there is not out and out secrecy there is much within business which remains behind the corporate veil. Intellectual property law, commercially sensitive data, compromise agreements for staff leaving organisations all provide more (or less) legitimate protections of corporate information. In liberal democratic governments the presumption is of the peoples’ right to know and only in clearly specified areas, such as national security, is there an ability for the state to limit transparency. Even then there is often oversight by independent individuals to ensure policies are not being breached.

Leading a country is about persuasion, consensus building and the ability to compromise. Running a private business you are the principal owner of is unlikely to be a good learning environment for those skills. Indeed it is very unlikely that direct challenge of any kind is going to flourish. From his behaviour in the course of the campaign and his month in office no one is going to describe President Trump’s management style as collegiate.

He clearly cannot tolerate anyone questioning his view of the world. His behaviour in the recent press conference confirmed this. He is hectoring and plain rude when he deals with people who do not simply say “Yes, Mr President”. His style betrays a lack of real confidence. He seems to need approbation and confirmation of his brilliance.

His continued attacks on Hilary Clinton are instructive, they are those of someone who, despite having won the election, is not convinced he has beaten her. At one point in the press conference he felt compelled to state. “I won the election.” Who was he trying to convince? Himself?

It looks very unlikely that President Trump will learn from his mistakes. Difficult when you do not think you have made any. He will plough on as he has started. As time goes by more and more people will say no to Mr Trump, eventually even those within his “team” will start to abandon him. He will become ever more beleaguered. The outcome is unlikely to be good. There is a chance he may resign in a fit of pique and speak to “his people” about how he has been undermined by the Washington establishment.

Alternatively he may start to manufacture reasons for dismantling the bulwarks of liberal democracy. He has already started undermining the legitimacy of the courts, the press and the opposition in Congress. With a divided America the opportunity for authoritarian action should not be underestimated. The idea that “it can’t happen here” was challenged by Sinclair Lewis in the 1930’s when populist right wing parties were growing across Europe. His warning has a new currency which should not be ignored.

Many see President Trump as an outrageous clown, a gift to the satire industry, a reason to open Twitter to see what latest irrational rant he has supplied for our entertainment. This is a mistake. President Trump is a dangerous liability.

He has identified a genuine and difficult problem. The existing political elite of Republicans and Democrats have failed to protect the interests of many millions of ordinary Americans. That issue will remain after President Trump has gone. Once he has gone if the narrative of “elite conspiracy” gets hold there are a lot of very angry and very well armed Americans who’s remaining faith in democratic change might be destroyed. If he does not go he may well become a genuine threat to American democracy.

 

 

 

State Visit and Brexit

You have to have sympathy for Mrs May. She probably has two in-trays, one, and by far the biggest, how to make Brexit work and second, everything else. Given this you might think it is not surprising that she drops the occasional diplomatic clanger.

The decision to extend an invitation for a State visit to President Trump is clearly a mistake. Rattled by the public outcry Downing Street’s initial response seemed to be “it wasn’t us”. There was the “clarification” of the process whereby invitations are proposed alluding to a some arcane Committee which no one had ever heard of as if it had come up with a proposal which Mrs May had just accepted. This was so obviously incredible no one really pushed it. According to all reports, Mrs May’s faults do not include a failure to attend to detail. The idea one of the UK’s most powerful weapons in the arsenal of soft power would be deployed without her specific proposal much less considered approval is laughable.

The question then arises about why do it so early in Trump’s presidency. Yes Mr Trump was elected and yes he is now the leader of the most powerful nation in the world but why offer him the star prize this early in his Presidency. Usually this is something that happens a couple of year in. Mrs May seems to have gone a lot further than most British leaders on the first date. Well beyond holding hands.

It could be that no one in her team appreciated how unacceptably President Trump could behave. This seems unlikely. Whilst his capacity to shock is undiminished his ability to surprise is long past. His demeanour is boorish, his attitude to almost every minority, and some majorities, is appalling and his politics are vile. All of this is clear and has been so for some time.

He is, non the less, the democratically elected leader of the US and it is a key part of the job description of the UK Prime Minister to establish a professional and friendly relationship with the “leader of the free world”.  With everything that was known before the visit however you might have thought the emphasis, at this early stage, would be on establishing a professional relationship. Friendship, might have been seen as a future goal, growing out of cordial in the fullness of time.

The fact Mrs May had forewarning of the ban on immigration makes things even more puzzling. She was not ambushed in the Turkish press conference, she and her advisors had plenty of time to think about this. Something which the majority of our allies responded to in clear and unambiguous terms almost immediately was given a straight bat in Turkey.

Unfortunately, she has now painted herself into a corner where there is no good move. She sticks with the invitation and risks a visit marred by demonstrations or withdraws it and upsets the biggest toddler on the planet who will scream and scream and scream.

But why? How has someone who was selected precisely because she was seen as a safe pair of hands arrived at this pass? I started this piece speculating about Mrs May having two in-trays. Of course that is not true. There is only one and it is Brexit. Her place in history will be defined by Britain’s withdrawal from the EU. To make this a success is probably Mission Impossible but to prevent it being an unmitigated disaster hard Brexit requires alternative trading agreement being put in place and in record time.

Could it be that the need to make early progress on a trade deal with the United States blinded Mrs May to all the risks in developing a close relationship with President Trump? Perhaps. It is impossible to know from outside. What is clear is that it has not been Mrs May’s best moment so far and it has created an issue which has a long way to run. More significantly it betrays a failure to appreciate quite what a challenge President Trump represents. With him politics has shifted gear and the existing political elites are struggling to come to terms with this. They need to and fast.

Politics and Ethics

Politics and ethics make uncomfortable bedfellows. Some think they have nothing to do with one another and that it is only a naive liberal who could think they have any connection with each other in the “real world”. Robin Cook, when he became Foreign Secretary in 1997, was ridiculed by some and patronised by others when he set out his Mission statement and talked about an ethical Foreign Policy. Over his period in that office this was often used as a stick to beat him with when some trade deal was done on weapons or some visit from the head of an unsavoury ally occurred.

Politics, it is argued, is about the art of the possible and should not be constrained by ethical considerations which get in the way of a “good deal”, more often than not a good trade deal, and quite often a good arms trade deal. There is rarely a shortage of highly respected politicians and business leaders willing to point out that in the real world we have to be pragmatic and often sup with the devil. That realists have to put aside their moral scruples on particular issues for a greater good.

That politics is a messy business is unarguable. Yalta was not a meeting of those with a common ethical view of the world looking forward to the defeat of fascism. Politics is always about compromise and deal making. In democracies compromise is at the heart of the process. Those that lose elections compromise their views to allow the winners to implement theirs for a period of time.

That politics requires a pragmatic approach to issues does not mean, however, that it is, or should be, an ethics free zone. There are times when the ethically right thing to do is also the politically correct thing to do.  Usually the ethically right thing to do is more difficult and the benefits less tangible but that does not always, of itself, change its political correctness.

Mrs May had a a difficult hand to play in her visit to the United States. President Trump is the democratically elected leader of the most powerful country in the world and maintaining a sensible relationship with him is in the interests of the UK. Given President Trumps behaviour to date, during the election, as President elect, and latterly as President, many would find it difficult to shake hands with the man, nay be in the same room as him.

Politicians earn their pay when they subordinate their feelings to the needs of their country and do things which may be personally distasteful to them. However, suppressing all ethical judgement is a mistake. When approaching the meeting with President Trump geo-political security, trade, the implications of Brexit were all matters where the UK has a vital interest in US attitudes and one cannot make progress by standing apart from someone in such a key position of power.

To be fair, Mrs May also addressed some of difficult areas of concern such as President Trumps views about NATO. However, her desire to secure a favourable response from President Trump was palpable and it was clear from her speech in Philadelphia she wanted to maintain the “special relationship” with the US. This relationship, first enunciated by Churchill in 1946, has always been one of a junior and senior partner and in the realpolitik of diplomacy has been of material benefit to the States occasionally (when they need support in the UN for a foreign adventure) and helped UK morale in its transition from “top Nation” to somewhere much further down the pecking order.

Going into this meeting Mrs May knew what President Trump is like. What you see is what you get and what you see is awful. She might have thought that some distance from this man might be sensible. Polite and respectful of someone who has been elected to such an important office, business like in areas of common concern but above all reserved.  The image of his holding her hand may well haunt her for years to come, however, what she could have done to prevent that is uncertain. Comments about the “stunning election victory” were a gratuitous hostage to fortune. His stunning victory is that of the “noisy minority”.

If the president represents the American people we do not want a “special relationship” with them. The reality is he does not. He does not represent the half of the electorate that voted against him, and it is my strong belief that in due course those that voted for him will come to the view that he does not represent them either.

There have been few reasons for optimism as the new year began. Two impressed me, both out of the United States. First Michelle Obama’s last speech which was a model of optimism and dignity, second the women marchers following the inauguration. Maintaining a special relationship with this face of America has to be the right thing to do. But to paraphrase, right now America is the worst of places and the best of places.

Ethically President Trump is repugnant. Despite the circumlocutions of some, the alternative facts of others and the wishful thinking of many he is also politically repugnant. I suspect Mrs May is going to regret bitterly the invitation to meet our head of state.You have to work with lots of people but you need to chose your friends carefully. You are often judged by their actions.

What looked like a competent managing of a difficult challenge on Friday has started to unravel as President Trump issued an odious and in truth incompetent Presidential edict on immigration. Mrs Mays’ initial response at the press conference in Turkey was 100% political and ethics free.  Basically, US immigration policy is the responsibility of the US.

Maintaining a pure ethical stance amongst the crooked timber of mankind is probably impossible. However, a good politician never loses site of what is right and wrong and makes difficult judgements about when a line is crossed. Often those judgments carry a political or a personal cost, or both. When they are not made however they can have awful long term consequences.

Robin Cook was presented as naive when he talked about an ethical Foreign Policy. No doubt there were some who thought his ethical stance, resigning from his position of Leader of the House of Commons in 2003 following the invasion of Iraq, was naive also. Had there only been more such naive politicians with robust moral compasses’ at the time the world might have been a much better place.