As our nation emerges from the Great Recession, many economists and pundits yearn for Americans to start spending more. But in this yearning for a return to the economy of old, we may be neglecting an incredible opportunity to move away from a consumerism-driven economy.
In fact, a more deliberate policy discussion should focus on ways to accommodate new economic habits and trends that are undermining status quo economic assumptions and governing approaches to regulating and reporting on commerce.
From Farmer Markets to technology-driven efficiencies, a new generation of entrepreneurs is re-writing rules faster than societal regulatory and reporting systems can adapt. As such, Americans are being given an increasingly false picture of economic activity and health.
In the past, I’ve written for the RP about how social media—in the hands of democracy seeking activists—is the greatest emergent threat to oppressive regimes. A similar dynamic is emerging from grassroots and netroots entrepreneurs who are pursuing ways of exchange that baffle those who seek to tax, regulate, and measure economies.
I have experienced this firsthand through farmer markets, where my wife built her original client base and became emboldened to leave her corporate accounting job to open her own (now successful) pet store. Indeed, these markets are proving an enormous incubator of small businesses. I have witness firsthand several folks make the transition from vendors hawking their items on rickety tables and from the back of trucks to successful shops and restaurants.
What has further stood out to me about the farmer markets is the terms of exchange negotiated vendor to vendor – perhaps the one true place where a barter economy still exists. What has emerged in Greater Cincinnati is a conceptual cousin to the “network of cooperative colonies” envisioned in Upton Sinclair’s depression-era campaign for California Governor when he advocated for building a system of localized barter economies.
The critical distinction, of course, is that these networks have emerged organically rather than being central government driven. In this sub-economy, the bread vendor gives a few loaves to the pet vendor who in turn swaps food for the baker’s pet; the baker provides bread to the farmer who uses it for himself and to feed his animals, and exchanges, in return, meat for the baker who tonight will be grilling chicken for her kids. The values of goods are determined through person-to-person dialogue. Contrary to the economy experienced by most, those who barter are intimately familiar with the value of the goods they negotiate via personal transactions.
In a consumer society built on several degrees of disconnect from the people who grow or manufacture the products we eat and wear, and who provide the credit we often use for purchases that offer a false sense of wealth and inflate costs, the Farmer’s Market is the antidote: a personalized culture of relationships intimately connected to the goods we share and consume.
At a different level, we see these emergent ways of doing business challenging and even undermining the ways in which wealth is measured. Victor Hwang’s recent fascinating piece for Forbes discusses this dynamic as it plays out with businesses like Uber, which trades spare passenger seats in cars:
Here’s some news that might surprise you: Uber will lower America’s gross domestic product . In fact, it has already started. The more Uber grows, the worse our GDP will get. And it’s not just Uber. Many of its startup cousins—like Lyft, Airbnb, and others—are also guilty of shrinking our economic growth numbers. The trend is about to become an epidemic.
The emergence of Uber challenges how our nation measures Gross Domestic Product because it encourages sharing in areas once reserved for consumption—indeed, “a high-profile example of the sharing economy, which revolves around the idea of people sharing underutilized resources.”
GDP may in fact present a false picture. New economies should not have to cater to the dated calculus of stale institutions; the institutions should facilitate the ideas, instincts, and innovation of entrepreneurs. As Hwang asserts, “presidents, prime ministers, and others will have no choice but to rethink the way they measure economic vitality.”
This doesn’t just go for the business start ups or the technologically gifted. It also speaks to a national shadow economy that provides real services. We often hear of true unemployment versus the reported unemployment, as there are millions of people who aren’t counted because they’ve stopped looking. But many of those who stopped looking for jobs are in fact working. They afford work by hiding from their government.
So what is the appropriate policy response? Yes, “the State” could continue to seek new ways to capture national productivity and GDP, as well as devise ways to clamp down on personalized transaction paid through barter or cash.
Or perhaps a better path forward would be to look critically at tax policies that promote rather than harnesses broadened definitions of economic vitality? Bloomberg View’s Mark Buchanan examines this reassessment of “wealth” for its broader implications:
The work of creating better measures is decidedly unglamorous, and yet perhaps nothing is more important. It entails finding ways to count the value of intact ecosystems in the natural recycling of wastes and in maintaining soil integrity. It requires quantifying the depletion of capital through the extraction of exhaustible resources such as minerals or fossil fuels, or the destruction of renewable resources such as fisheries or forests. The economists and scientists doing this work might turn out to be the heroes of the future.
In America, this might include looking at ways to incentivize a more holistic notion of national wealth versus today’s consumer economy.
Does the income tax, for example, complement the American entrepreneurial spirit, or serve as its harness? Perhaps a national sales tax instead of income tax is more in line with the American experiment? Exempting the first $10,000 in worker earnings from payroll tax (FICA) could offset the regressive nature of a sales tax.
Policies that encourage savings, a real individual-level valuing of goods, and personalization versus distancing that comes from genuine control over what you earn and how you spend what you earn should be part of some new reckoning with an economy that is, and should be, ever changing.
Much human activity is economic activity: our jobs, our consumption. How do we facilitate not the economy but a system of economies where individuals are empowered to earn and to spend in ways that facilitate authenticity, personalization, and sharing?
More exciting still, such tax reform would have a strong cleansing effect on democratic institutions hijacked by powerful interests that currently manipulate the tax code to the advantage of elites that pay for their services—you know, the very institutions that were formed to give power to the people.
Other areas of consideration might include de-emphasizing “punishing” income in favor of rewarding conservation that preserves our nation’s natural assets. In fact, one recent proposal emerging from Congress to tax carbon could see daylight if, as the New York Times’ Greg Mankiw suggests, it uses “the new revenue to reduce personal and corporate income tax rates.”
For my next column, I will explore more fully how tax reforms can be part of the toolbox for simplifying our tax code, encouraging national re-investment, and renewed personalization and individual control over our current economy’s abstracting effects: making tangible costs for a debt and consumption-driven nation that should change its habits for the good of our individual, economic, and environmental well being.
Hillary Clinton raised eyebrows recently with her apparent dig at President Obama: “Don’t do stupid stuff is not an organizing principle.” Because she is a Clinton, it should be assumed this was not a slip. And because she is Hillary Clinton, it should not be forgotten that she voted in support of the 2002 resolution to go to war against Iraq.
The war in Iraq was a colossal tragedy for many reasons: the staggering loss of Iraqi civilian life; the mental and physical casualties ensured by American soldiers whose needs to this day go under-addressed; Post-911 mission creep when the American desire to strike back against terrorism was manipulated and misdirected by a President and his neo-con handlers.
This essay is not an attempt to re-litigate the Iraq war. That verdict has already been rendered. But the aftermath of this messy post-Iraq geo-political realignment has led me to begrudgingly veer towards Clinton’s assertion that a new set of organizing principles is needed to navigate this complicated world. There is a glaring need for muscular global strategy on which America must lead.
For the tragedy of Iraq also plays out today in the emergence of ISIL – a well financed, well governed and military savvy operation that is establishing a base of operations from which to pursue a caliphate that unifies the Islamic world—albeit, a type of world that most Muslims reject.
An under-reported insight on the growing appreciation of this threat is that the Obama Administration started referring to this organization as “ISIL” instead of ISIS. This marks the Administration’s recognition that ISIL not only has ambitions beyond Iraq and Syria, but also the Levant (the “L” of ISIL), which includes Palestine, Jordan, Lebanon and most alarming, Israel.
America does not have the luxury of W’s division of good versus “evil-doers.” Unfortunately, we will have to choose among worse evils, and create the kinds of coalitions needed to keep extremist elements in check.
Aside from the aforementioned tragedies of the Iraq War is the need to understand that America and her allies were probably safer when the repugnant Saddam Hussein was in power in Iraq. Furthermore, we are probably safer with Assad in power in Syria. Just as in WWII we had to form unholy alliances with the likes of Stalin’s Russia—as brutal a dictator there ever was—in order to defeat the global designs of a genocidal Nazi dictator, we now must keep in check a global terrorist organization whose desire, and cruelty to match, is to purge the Middle East (and beyond) of the non-faithful.
New Organizing Principles
Under new organizing principles, our ability to halt the most dangerous global threat is to join forces with less seemly partners that are equally motivated to keep in check this threat, and that includes the likes of Egypt, Iran, Syria, Saudi Arabia and Russia.
We also must reconsider American troop deployment. Today, of some 160,000 American troops deployed overseas, the good majorities are in Europe and East Asia. This geography of American deployment does not complement the geography of today’s emergent global threat. For example, we currently are downsizing our operations in Afghanistan, which likewise reduces American military capability near a nuclear Pakistan that has long been a safe haven for terrorists.
America must also unify our allies and enlist their strategic leverage over our gravest threats. We must first acknowledge the threat, and then plot global response. Publicly, at least, the effort seems haphazard, and insufficient to the cause of defeating the greatest terrorist threat to date—one that has an army, international recruits (who can travel in and out of the West), and vast real estate for a base of operations.
While the French take to the streets to protest Israel, or Russia focuses on Crimea, the larger looming danger that is ISIL takes a backseat to fragmented and parochial interests. This must change. And America must take the lead in rallying the world against an emergent terrorist state that poses a potential grave threat against our own safety and the safety of our currently unfocused allies.
Judging from media coverage, one would think the emerging solution to the Syria predicament arrived somewhat randomly. But when considering the supposedly “random” sequence of developments on Syria, what emerges is something far more strategic:
A) President Obama, on the eve of the G20 summit, reminds international leaders that chemical weapons containment is a shared obligation:
“My credibility is not on the line. The international community’s credibility is on the line.”
–“World’s credibility at stake over ‘red line’ on chemical weapons use in Syria, Obama says,” Associated Press and The Telegraph, 09/04/13
B) During the G-20, Obama and President Putin (Syria’s enabler to date) find time during the G-20 Summit to meet on Syria:
President Obama met privately with Russian President Vladimir Putin Friday in the midst of their public dispute over how to respond to a chemical weapons attack in Syria. Mr. Obama told reporters at the G-20 summit in St. Petersburg, Russia, that his conversation with Mr. Putin was “candid.” And he said a looming United Nations report about chemical weapons use by the Syrian regime would make it tougher for Mr. Putin to oppose punishing Syria militarily.
— “Obama, Putin discuss Syria on G-20 sidelines,” Washington Times, 9/6/13
C) Secretary Kerry supposedly off cuff response to a reporter’s question if there was anything Syrian President Assad could do to avert an attack: “Sure, he could turn over every bit of his weapons to the international community within the next week, without delay,” Kerry said. “But he isn’t about to.” Russia seizes the opening created by Kerry’s comment:
Speaking in London earlier today, John Kerry appeared to issue a long-shot ultimatum to Syrian President Bashar al-Assad, suggesting that if he turned over his complete stockpile of chemical weapons within the next week he could avoid an attack from the United States. The State Department, however, would later walk back those comments, saying they were a “rhetorical argument” and not an actual proposal, adding that Assad “cannot be trusted” to take such action …. [T]his afternoon once Assad and his strongest ally, Russia, caught everyone off guard by suggesting that Kerry’s ad-libbed solution was actually workable.
–“Did John Kerry Just Accidentally Find a Workable Solution for Syria?,” The Slatest, 9/9/13
D) Within a couple hours, Russia presents Kerry’s “rhetorical” comment as a solution. Syria responds immediately: “Syria today ‘welcomed’ an offer by Russia to put its chemical weapons arsenal under international control so that they could eventually be destroyed’”:
Syria’s Foreign Minister Walid al-Muallem, who met with Lavrov in Moscow earlier in the day, responded almost immediately. “The Syrian Arab Republic welcomed the Russian initiative, based on the concerns of the Russian leadership for the lives of our citizens and the security of our country,” Muallem told reporters, according to Russia’s Interfax news agency. The proposal also received quick support from United Nations Secretary General Ban Ki-moon and British Prime Minister David Cameron.
— “Syria ‘Welcomed’ Russian Proposal to Destroy Its Chemical Weapons,” ABC News, Sept. 9, 2013
Now let us consider the possibility that these development were not so random …
Read the rest of…
Greg Harris: On how we got to the emerging solution to the Syria crisis
(Photo by Jeff Gross/Getty Images)
If you haven’t entered the First Quadrennial Recovering Politician Electoral College Contest, you’ve got until tomorrow, Tuesday at 6:00 AM EST. Here are the details for your chance to win 2 FREE lower-arena tickets to the defending national champion University of Kentucky Wildcat basketball team’s official home opener at Lexington’s Rupp Arena, versus Lafayette University, on Friday, November 16 at 7:00 PM. Remember, the first step is to become a member of the RP’s new Facebook page, Facebook.com/RecoveringPol, and provide your predictions in the post marked “Designated RP Electoral College Contest Post.” The award will be presented to the individual who most accurately predicts the final Electoral College vote, with tiebreakers of predicting the Senate and Housr partisan compositions after the election.
The 2008 Electoral College Map
As a service to all of you procrastinators out there, our experts — contributing RPs and friends of RP — have weighed in on their predictions. You can choose to go with one of their picks, or stick with your own and feel smarter than a recovering politician.
So here goes. Feel free to comment below, but remember according to the rules, only comments at the Designated RP Electoral College Contest Post at the RP Facebook page will be qualified for the grand prize.
The RP: Obama 303, Romney 235. (Obama wins WI, NV, IA, NH, CO, VA and OH; Romney squeaks out the narrowest victory in FL); Senate: 50 Dems, 48 GOP, 2 Indy; House: 239 GOP, 196 Dems
Contributing RP Rod Jetton:
President- Romney 277 and Obama 261. Romney takes the true toss ups of NH, CO, IA and WI, while holding the safer states of FL, NC and VA. Obama keeps OH, MN, MI, NV and PA. The auto bailout keeps Obama with Ohio, but Ryan and the debates help Romney hold WI which Ohio is not required on their path to victory. PA will be close but O will hold on there. R wins popular vote 52-48. With unemployment at 7.9% and even worse, gas prices up over $3.50, it is amazing that any incumbent could even keep it close. When we add in how Obama seemed to have a bit of the Bush 42 attitude of not really wanting to mess with a re-election campaign plus the Libya debacle it is hard to see Obama winning. Romney is a solid steady campaigner that nobody loves, but he has a good resume and seems to be up to the job of fixing the economy.
Senate- D-52 and R-46. (I-2) The Republicans will pick up a few seats but the weak candidates will keep them from taking the majority. My state of Missouri is a good example of that. McCaskill was in bad shape and should have been defeated in 2012 but with all Akin’s messaging problems she is poised to survive.
House – R-237 and D- 198. There will not be a big change in the House and Romney’s debates and October surge will help Republicans down ticket in many of the battleground seats.
Jordan Stivers (Friend of RP): Obama 280, Romney 258; Senate: R-47, D – 51, I-2; House: R-237, D-198
Contributing RP John Y. Brown, III: Election Day will be followed by Wednesday….and, if all goes as planned, followed by Thursday. Short of cataclysmic fallout on Tuesday night, Thursday more than likely will be followed by Friday. And then we will probably see something resembling what we used to call “the weekend.”
Friend of RP Zac Byer (traveling with VP GOP nominee Paul Ryan): My head still says Romney tops out at 256, but after visiting 6 swing states in the last 56 hours, and my gut says otherwise: Romney: 277, Obama: 261; 51 D, 47 R, 2 I; 238 R, 197 D
Contributing RP Jeff Smith: Obama 277, Romney 261; Senate: R-48, D – 50+2I; House: R-240, D-195
Ron Granieri (Friend of RP): Obama: 280, Romney: 258; Senate: 51-49 Dems (with independents); House: 245-190 Reps
Contributing RP Nick Paleologos: Obama 275. Romney 263.
Steven Schulman (Friend of RP): Whatever Nate Silver says.
Contributing RP Jimmy Dahroug: Obama 275, Romney 263; Senate: Dems 51 GOP 47; 2 Indy; House: GOP 241 Dems 194
David Snyder (Friend of RP): Obama wins 290-248. Senate – 51 Democrats 47 Republicans, 2 Independents. House – 234 Republicans, 201 Democrats
Contributing RP Greg Harris: Obama: 332, Romney: 206 (Polls indicate presidential race is neck and neck among “likely” voters. Obama’s lead is greater among “registered” voters. These votes, under-represented in polling, will redound to Obama’s advantage in states like FL and CO.); Senate: R-44, D – 54, I – 2; House: R-232, D-203
Robert Kahne (Friend of RP): Obama: 332, Romney: 206. Senate: D:53 (inc 2 IND) R: 47. House: D: 205, Rep: 230
Contributing RP Jason Grill: Obama gets 294 and Romney 244; Senate – 52 D 46 R 2 I; House – 234 R 201 D.
And watch this for more of Jason’s analysis:
Insurance Executive: We don’t like Obamacare. Before Obama, our control over the health industry gave us great license to do everything we wanted to do in order to make big bucks. A person on one of our polices who gets really sick and expensive to cover? Throw them off. A child with a pre-existing condition who will cost more to insure over a lifetime? Deny her coverage. Can’t afford coverage? Sucks to be you.
We also became very adept at spending more on ourselves and our middle-men than spending on healthcare. Obama now isn’t letting us do that. We actually have to send rebates to the people we insure if we spend more on ourselves than on their health! And his purchasing cooperatives will make us compete with private insurers in cities and in some cases, entire states, in areas where we once had absolute monopolies, which will make us lower prices to be competitive. Yeah, we price out about 50 million people, but that’s free enterprise! Vote Romney!
Plutocrat: Obama will appoint Supreme Court Justices that will most certainly overturn Citizens United. My ability to anonymously fund Super PAC’s with unlimited dollars is my right because the Supreme Court says spending and speech are one in the same. Indeed, rich people are now much freer than everyday people. Let’s keep it that way. I spent $20 million helping Romney via my Super PAC; but that’s a drop in the bucket compared to tax cuts I will receive if Romney prevails. And some of my wealth will even trickle down to the lowly 47%, so everybody wins! Vote Romney!
Read the rest of…
Greg Harris: Closing Argument for Mitt Romney — Views from his Base
“Congress’s use of the Taxing Clause to encourage buying something is . . . not new. Tax incentives already promote, for example, purchasing homes and professional educations. See 26 U. S. C. §§163(h), 25A. Sustaining the mandate as a tax depends only on whether Congress has properly exercised its taxing power to encourage purchasing health insurance, not whether it can. Upholding the individual mandate under the Taxing Clause thus does not recognize any new federal power. It determines that Congress has used an existing one.” –Chief Justice John Roberts
The Supreme Court earlier today upheld “Obamacare.” The majority opinion, drafted by Chief Justice Roberts, essentially recognized that taxation to influence consumer behavior in this country is nothing new. Republican leadership is already vowing to kill it. I’m curious to know what provisions of insurance reform they will kill first . .
The first provisions include barring insurers from discriminating against children with pre-existing conditions, allowing parents to opt to keep their own children covered on their plans until they turn 26, and fixing the Medicare reimbursement gap (the “doughnut hole”) that costs seniors several hundred dollars each year. Will the GOP fight to continue medical discrimination against children? Will they kill legislation to reimburse seniors? Will they stop parents from keeping their children covered until age 26?
The law has also required states to create high-risk pools that cover individuals denied private insurance due to pre-existing conditions. Will they now ask the adult with multiple sclerosis to give up that coverage?
Moving forward, health insurance reform will establish insurance exchanges and purchasing cooperatives where insurers that currently enjoy monopolies over entire regions will face competition from other private insurers. Will the GOP kill private sector competition in favor of retaining insurance monopolies? Will they prevent small business and the self-employed from entering into purchasing cooperatives so they can enjoy the discounted coverage that results from economies of scale?
The GOP laments the effects of Obamacare (modeled after RomneyCare) on the economy, especially small business. But the only small businesses impacted by healthcare legislation are those that employ over 50 people. About 96% of all small businesses do not employ over 50 people, and so will not be effected. As for those that do employ over 50 people, most of them already provide healthcare. They will now be getting tax credits to make their coverage of employees far more affordable. Will they take these small business tax credits away?
So in the coming days, I look forward to hearing from GOP leadership, specifically, whose health care will you be killing?
[Click here for a link to the entire RP Debate on Roger Clemens]
I do not think ball players should be banned from the Hall of Fame for moral reasons not having to do with performance.
As a Reds fan, which everyone knows is the greatest sports franchise on the history of the planet, it bother me that “hit king” Pete Rose is still barred from the Hall for activities having nothing to do with his performance on the field as a player. (Ok, not totally relevant to this debate, but I just had to say that.)
As for players who took performance enhancing drugs, they should not be given a place in the Hall.
Their stats were jacked because they were juiced. But Clemens was found innocent, and it’s not for the Hall to try and convict him. So let him in.
[Click here to follow the entire RP Debate]
I truly hope discussion about the Post piece doesn’t turn into debate about its timing versus substance.
Reporters are digging into Romney’s post, just as they dug into Obama’s (Rev. Wright, etc). In doing the digging, they came upon the recollections of grown, prosperous men about a bullying incident that haunted them through the years. A peer at their school was harassed, held down and sheared. The prosperous son of a Governor/Big 3 CEO committed the act. That’s pretty damn mean.
What concerns me all the more is that Romney seems to acknowledge the incident, though with faint memory. I think a human being should remember something like that–that is, unless they are wired differently.
Of course, this wouldn’t be as relevant if Romney’s policy positions didn’t reveal callous attitudes towards the GLBT community. Physically restraining a “different” student is one things; policy prescriptions that restrain an entire population from military service, the right to marriage or even civil unions, brings such dehumanization to scale.
[Click here to follow the entire RP Debate]
It doesn’t take a decades old bullying incident to illuminate Mitt Romney’s views towards gays. His current public policy positions say enough. Mitt Romney believes that gay people are second class citizens.
Mitt Romney believes the humanity of gay citizens is not equal to the humanity of straight citizens. Otherwise, Mitt Romney wouldn’t advocate for denying the basic right for gay people who love one another to marry one another.
Mitt hails from a party that often claims government encroaches on religious liberty. But Mitt’s vision of government encroaches on my religious liberty. I am Jewish, and Reform (and Conservative) Judaism recognizes the rights of gay folks to get married. But under Mitt’s governing philosophy, the government would supersede the right of my faith community to recognize and sanction gay marriage.
Small government and individual liberty aren’t universal principles within the modern Republican Party. They only apply to those who were born the “right” way.
Delaware Online has the scoop on contributing RP Greg Harris:
An Ohio former elected official is coming to work in Delaware because he was “awarded a major contract with a nonprofit group in Delaware that seeks to improve public education in that state,” according to an Ohio newspaper article.
Greg Harris, a Democrat, dropped out of running for commissioner in an Ohio county after his firm was awarded the contract, according to City Beat. The story does not name where he’s headed to in Delaware.
I was checking out his Twitter account this evening. He posts a lot about education, including Delaware news. I’m not sure where he leans in the ed reform debate, but he get a retweet from Diane Ravitch on April 2. On the other hand, he’s also tweeted links to theRodel Foundation blog.