Conservativism Economics Financial Crisis Political Philosophy Politics The Opinionsphere

The Only Credible Response to Globalization

Niall Ferguson in The Telegraph:

Underlying this tremendous growth in financial markets was a fourfold liberalisation of international markets for goods, services, capital and labour. This was not, of course, peculiar to the English-speaking world: globalisation, as its name suggests, is ubiquitous. But its implications for those on the Anglophone Right were distinctive. Unremarked by conservatives in Britain, America and even Australia, these great shifts created a new and much greater trilemma.

Suppose that a government can have any two of the following things, but not all three: globalisation, in the sense of openness to international flows of goods, services, capital and labour; social stability; and a small state. Or, to put it differently, conservatives can pick any two from an open economy, a stable society and political power – but not all three.

Ferguson is extremely articulate (and credible) in his explanation of why conservatives have no “articulate” answers to globalization. He believes that conservatism will be able to once again thrive once it chooses to sacrifice social stability, which he links to social mobility. Although the two concepts certainly are related, it’s hard for me to accept the re-branding of one as the other – and it seems a bit too pat on Ferguson’s part. On the other hand, Ferguson describes the other side of the argument:

Only the Left appears to have a credible response [so far]: globalisation, plus social stability, plus a strong, interventionist state.

The set-up Ferguson proposes then would be:

The Left

In favor of:

  • Globalization
  • Social stability
  • Strong, interventionist state

Accepting as necessary evils:

  • Government interference
  • Less social mobility


In favor of:

  • Globalization
  • Social mobility
  • Small (but “smart”) state

Accepting as necessary evils:

  • Inequality
  • Booms and busts of the financial cycle
  • Social disorder

Ferguson avoids all the tough questions – such as what “smart” means – and how this would relate to regulation – and just presumes that governmental actions, inequality and social mobility are directly related – and that somehow, more inequality leads to more social mobility. I think perhaps Ferguson is attempting to create a scenario when he can plausibly oppose the man he describes as “the most Left-wing Democrat ever elected to be President of the United States.” This seems to me to be a rather implausible description of the pragmatist that Obama is. But this points to what is distorting Ferguson’s extremely interesting and insightful view of political ideologies and the current world trends. 

Let me propose an alternate party – one that it seems Barack Obama is already leading:


In favor of:

  • Globalization
  • A strong, interventionist state to aid in the creation of and to police the market
  • A state that balances the need for a social safety net and individual incentives
  • A balance between social stability and social mobility

Accepting as necessary evils:

  • Inequality (but not extreme inequality)
  • Government interference
  • A level of social disorder
  • The boom-and-bust financial cycle (but mitigated)

The idea is to maximize certain goods while balancing against the evils that are their side effects. Extreme inequality can decrease social mobility at least as much as government distortions. A social safety net of the right type can act both a great equalizer and as an incentive for individuals to pursue their entrepreneurial ambitions. 

My problem with Ferguson’s critique is that he seems to view the debate between the Left and conservatives as an either/or proposition – which it often is – but given the situation he describes, it’s more an argument of degree rather than kind. The Left that Ferguson is arguing against may favor social equality over social mobility but both sides agree that both goals are worthy. It’s a question of what the right balance is.

Barack Obama Politics

The Paradox In Organzing For America

[digg-reddit-me]Last week, I received a phone call from an Obama-affiliated group asking me to “Call my congressman and tell them to support Obama’s budget,” or something along those lines. I didn’t. Apparently, many others didn’t as well.

At the same time, Organizing for America, the follow-up to the Obama campaign organization run by David Plouffe, sent out emails and organized people to knock on doors to encourage support for Obama’s budget. From what I’ve heard and read, all this push is having an effect, but it’s been underwhelming.

Here’s my thought:

The Obama campaign was extremely effective about this because it people knew they had to make a choice and vote. Knowing that this was coming up, they evaluated all the information they came across with this in mind. Those who settled on Barack Obama then had to defend their choice – and if they were of a particular type of person – they could promote his candidacy. And so it was that hundreds of thousands of people became convinced to try to achieve a single shared goal. This group proved extremely effective – at fundraising, knocking on doors, defending Obama against attacks, mounting attacks against his opponents, and eventually, getting people out to vote.

The process was something like this:

  1. Citizens realize they must make a choice.
  2. They evaluate the choices.
  3. They make a choice.
  4. Their goal becomes to convince others to make the same choice.
  5. As more citizens become convinced to take on this shared goal, the process accelerates.

Organizing for America faces a different challenge on several levels – the first of which is the difference between choosing a candidate and supporting a policy that you will not be required to vote on. In the first case, there is a level of personal responsibility inherent in choosing and voting for a candidate. Regarding legislation though, the people have no direct voice. Their only direct responsibility is to vote in the right people to make these decisions. The influence they might or might not have is indirect. That’s why organizing people for this purpose is more complicated. The tendency is for people to take a more passive approach to legislation – “Let’s give them a chance” rather than “This is the best policy.” Citizens evaluate information differently if they know they will be forced to make a choice based on their evaluation of the information.

It seems the Obama administration and Organizing for America are aware of this – and are trying to figure out how to keep people involved, to change the expectations and force people to take a position, to make a choice. Thus they are encouraging people to pressure those representing them and to try to convince other citizens of the worth of Obama’s budget. But the problem is this type of movement will never gain momentum unless people first have a shared goal. 

So, the Catch-22 is that without a shared goal, citizens are less likely to organize; citizens are less likely to have a shared goal unless they are forced to make a simple choice; the main means Organizing for America is using to force people to make a choice implicitly assume a shared goal.

There is some reason to have faith that Obama can overcome this seemingly impossible loop. Because he already did so with a similar loop – which I described in The Paradox of Obama. Or even better, and more appropriately, the answer might come from citizens discussing these ideas within the tubes of the internets.

Foreign Policy Iran Politics The Opinionsphere

Signs of Hope: Iran

Roger Cohen in the New York Times has become a major supporter of engagement with Iran. After describing the continued provocations by Ayatollah Khamenei in response to Obama’s latest peace offering of sorts, he explains:

Khamenei also quieted the crowd when it began its ritual “Death to America” chant and he said this: “We’re not emotional when it comes to our important matters. We make decisions by calculation.”

Cohen sees the same opening with Iran that the esteemed foreign policy expert Les Gelb as interviewed by Barbara Slavin does (h/t Andrew Sullivan):

Iran as a society is more middle class and more prone to democracy than any other country in that part of the world. Within ten years, Iran will be our closest ally in the region.

Financial Crisis Politics Scandal-mongering

Eliot Spitzer’s Comeback

In the past few weeks, Eliot Spitzer has been all around us. His Slate columns have become a must-read. He was against AIG before it was cool. He was railing against the excesses of Wall Street while everyone else was enjoying the fake boom. 

If it were not for the scandal that forced him to resign, this would have been Eliot Spitzer’s time. Vice Presidential buzz would be growing; he would be one of the go-to guys that Obama would call to give him cover as he dealt with Wall Street. It is based on this that David Rothkopf at Foreign Policy listed Spitzer as one of the “losers of the week” saying that:

[T]he A.I.G. scandal and the collapse of Wall Street could have been [Spitzer’s] apotheosis, the moment the howling dogs of ambition in his breast might have finally gotten enough red meat of press exposure.

But despite his current disgraced status – and no doubt in part because of it – he has been able to talk more candidly about the “real scandal” of the AIG bailout: that it “has been a way to hide an enormous second round of cash to the same group that had received TARP money already.”

This sets up Spitzer to now say, “sunlight is the best disinfectant“! Ironic for a man brought down by too much sunlight.

I’m going to repeat what I said before – as the conventional wisdom states that the only things that can truly destroy a political career are “a dead woman or a live boy,” Spitzer will be back. Given the magnitude of this scandal, he may be back sooner than we expect. Interviewed on The Brian Lehrer Show last week, his politic answer on whether he is planning to make a comeback as a media person made it clear he is still intent on winning back the public’s good graces.

His understated and calculated public appearances are not consistent with a man looking to become a media personality – he would want more appearances and try to adopt a more strident tone if this was his goal; they are not consistent with a man who is done with politics – as he does not have the gravitas and devil-may-care honestly and looseness that comes with this life decision; instead, he seems to be staging a comeback. He waited just over a year from his resignation before giving his first interview – despite the increasingly clear Wall Street scandal that he had been brewing. He’s focusing on policy, substance, and seriousness to avoid as much as possible talking about his past scandals. But his answer still have the slipperiness of a pol.

It’s only a matter of time before he runs for office again.

Humor The Media The Opinionsphere

Gallows Humor from an FT Employee

Daniel Drezner shares some gallows humor from a Financial Times employee:

[H]e described his niche as, “being in one industry that’s fucked writing about another industry that’s fucked.” 

Drezner had asterisks in place of the “uck” though.

Colombia Foreign Policy Mexico National Security Politics The Opinionsphere War on Drugs

The Price of Prohibition I: Propping Up The Mexican Cartels

[digg-reddit-me]We are keeping the finger in the dike.

Sgt. David Azuelo of the Tuscon, Arizona police force as quoted by Randal C. Archibold in The New York Times.

I’ve been arguing for some time that the War on Drugs and the prohibitionist policies underlying it must be ended for the sake of our national security. I’ve made the argument from a civil libertarian point of view; I’ve made the argument that the War on Drugs is interfering with the fight against terrorism; and I’ve made the argument based on the fact that this war is destabilizing our neighbors

Here’s a parallel argument:

The Pentagon listed Mexico as a country that might collapse suddenly into a civil war between the central government and the cartels. A top cabinet official in Mexico claimed that “unless [the cartels are] confronted, ‘the next president of the republic would be a narco-trafficker.” The levels of violence in the country now are astounding – with higher rates than those in Iraq in recent months – and they are continuing to spill over the border into America. We are currently supplying both sides of this conflict with weaponry and funds – and the conflict is escalating. Mexico is now following the route of Colombia by militarizing it’s approach to the problem of drugs. For decades, war raged in Colombia to stop the drug smugglers – inflicting an enormous cost on the country as they – in the words of an influential and prestigious report by former Mexican, Brazilian, and Mexican presidents, “implemented all conceivable measures to fight the drug trade in a massive effort whose benefits were not proportional to the vast amount of resources invested and the human costs involved.” The report explains that the “traumatic Colombian experience” should teach other nations “not to make the mistake of adopting the US prohibitionist policies.”

Yet, that is what Mexico is doing. For decades, America has waged a war on the suppliers of drugs and on drug users at home and abroad. The casualties have been high – but no matter the body count or the number of arrests has gone, the War on Drugs has remained “an utter failure.” This failure has allowed the reach of the Mexican cartels to extend far into America:

United States law enforcement officials have identified 230 cities, including Anchorage, Atlanta, Boston and Billings, Mont., where Mexican cartels and their affiliates “maintain drug distribution networks or supply drugs to distributors.”

As Stephen Walt explained in Foreign Policy:

[O]ur policy helps enrich drug lords and make it possible for them to destabilize whole governments, as they are now doing in Mexico and Afghanistan. 

As The Economist reported:

[P]rohibition has fostered gangsterism on a scale that the world has never seen before…[T]he war on drugs has been a disaster, creating failed states in the developing world even as addiction has flourished in the rich world. By any sensible measure, this 100-year struggle has been illiberal, murderous and pointless…

At the same time, the harm reduction strategy of the European Union, while mitigating the effects of drugs locally, has exacerbated the effects of drug production and smuggling elsewhere.

The failure of both the War on Drugs and the harm reduction strategy has created an enormous market incentive for smuggling, for money laundering, and for corrupting government officials. Together, these and other effects of the Drug War create a sense of lawlessness which is exactly where the cartels thrive. The cartels are able to thrive in part because the scale of their operations and the enormous profits generated give them both incentive and means to experiment with different methods of smuggling, money laundering, and corrupting officials. If there were a way to reduce these profits, it could undercut their successes in all of these areas and undermine the incentives that drive them to take these steps. The cartels might no longer be able to acquire military-grade weaponry; they might not be able to afford to buy subs to smuggle items in; they might not be able to afford to buy off the top Mexican drug enforcement official

We have reached the point that The Economist has characterized as a choice between “A calculated gamble, or another century of failure.” The calculated gamble is to legalize drugs, or at least marijuana.

People have asked me if legalizing marijuana would really make a difference in undercutting the Mexican cartels.

Marijuana represents 60 to 70% of the profits that fuel the Mexican drug cartels. Legalizing it would take away one of the main props holding them up – just as legalizing alcohol helped rollback the gangs that dominated American cities in the 1920s.

Violence in Mexico stemming from the drug war is destabilizing the country and spilling over into America. With a single move, we could remove the monopoloy which gives them 60 to 70% of the cartels’ revenue – in a single move, we could take away their “king crop.” Without the enormous profits of marijuana propping up the rest of the drug market, the costs of smuggling would increase. The distribution network would be pressured. The cost of bribing officials would likely increase as harder drugs would be the only things being smuggled and enforcement could focus more on these drugs. The pressure on our criminal justice system that is currently imprisoning a higher percentage of our people than any nation on earth would be eased. Border guards would be able to focus more on harder drugs, or even on serious threats to our security, rather than searching teenagers for pot. All of this would undermine the cartels – most of all, taking away 60-70% of their profits.

We have reached a point where one of our most aggressive drug czars has publicly stated that he “wouldn’t care” if marijuana were legalized! Where another former drug czar has acknowledged that marijuana “pose[s] no significant public health problem.”  These are men who led the fight against drugs. A massive propaganda campaign, $40 billion a year, millions of arrests, and untold casualties and – and the price of drugs has remained the same and the extent of drug use has barely been affected.

Why are we continuing a failed policy that only serves the interests of the Mexican cartels it is propping up?


“The Disgraced Former Governor” on WNYC

[digg-reddit-me]Eliot Spitzer was interviewed on The Brian Lehrer Show about AIG last week (in what I believe is his actual first interview post-resignation, contra Susie Madrak at Crooks and Liars and Fareed Zakaria):

Brian Lehrer: Before you go, some of the commenters on our website are angry at us for even having you on.

Eliot Spitzer: Mhmm.

Brian Lehrer: They ask, “Can’t we find any other expert to talk about AIG besides  a disgraced former governor?” and things like that. To those listeners, we’re having lots of AIG-related guests this week. We chose Mr. Spitzer for one perspective because of the unique history between him and the company when he was the only government entity really giving them a hard time. But Mr. Spitzer, it was a year ago yesterday that you left office. How do you feel now about having taken yourself out of the position of being more directly involved with all this?

Eliot Spitzer: Well, I’m obviously disappointed in what led to that; I’ve apologized and have acted in the past way that I should have which is to say that I will remain quiet …

As you suggested, there was a… period when as Attorney General of New York, I was pursing issues that no one else wanted to pursue. We pursued AIG and Wall Street structural failures  in a way that others shied away from because it was politically unpalatable for them to address these issues. Now it is the flavor of the month and everybody’s jumping up and down, serving subpoenas and beating their chests trying to be tougher than the next person.

That’s wonderful.

But as you say there was a moment when that was not the case and so perhaps I can add a slightly different perspective if I can…

Brian Lehrer: You said you would stay quiet but you’re not totally staying quiet. You are a Slate columnist…Are you trying to kind of make a comeback as a media person?

Eliot Spitzer: No. I’m simply trying to add a few words occasionally as I best can to shed light on some very vexing policy problems that are out there and that have not been addressed necessarily in the best way by our leadership. And we all have to work together to do what we can do to move forward and to the extent that writing a few columns and adding my perspective can help, I’m thrilled to do that and help in any way. I think that’s what we all owe to our society.

The clip is from the end of the interview which you can listen to here.

You have to appreciate Brian Lehrer asking questions “tough interviewers” like David Gregory seem to shy away from. It’s not so much that Lehrer asked if Spitzer was attempting a comeback – you can picture David Gregory calling on the control room to “run the tape” with some old footage of the Governor saying something like, “If I’m ever caught in a scandal, I’ll never run for office again!” and then pressing him on that point – but the way Lehrer followed up and challenged the line that Spitzer gave about “staying quiet,” as well as the way he confronted Spitzer with what his listeners were saying – that seems on par with Lehrer’s tendency to ask what most interviewers would be afraid to ask. (Another example being when he asked Sandra Day O’Connor, “Why did you deny the state of Florida the right to recount votes in its own state?” to her annoyance.)

Foreign Policy National Security Politics

Sarkozy: Right on nothing, prescient on everything

Judah Grunstein in Foreign Policy:

Yet if Sarkozy has been right on almost nothing, he has been prescient on almost everything, guided by the attention-seeker’s instinctive flare for tomorrow’s crisis today. (For instance, his decision to engage Syrian President Bashar al-Assad at the time of Lebanon’s presidential impasse in January 2008 later paid off in access to crucial back channels during the Gaza war.) His logic is the logic of the deal, where both fault lines in opinion and emerging consensus create leverage points that maximize France’s influence. His handling of last year’s NATO summit – where he sided with Germany to successfully oppose expansion to Georgia and Ukraine, while pacifying Washington with a much-needed troop increase to the Afghanistan deployment — is a perfect illustration of how he manages to turn France into either the tiebreaker or the consensus sealer.

France’s return to the heart of NATO will certainly not spell the end of France’s independence and autonomy, nor will it prove the alliance’s undoing. But both will be changed, in ways that no one – least of all Sarkozy – can foresee. Rich in symbolism, profound in consequences, unpredictable in effect: The move is typical Sarkozy, for whom it is the deed, and not the outcome, that matters

Criticism Political Philosophy Politics

Ruminations on the Egg and the Wall

[digg-reddit-me]About a month ago, one of my two favorite living novelists, Haruki Murakami, went to Jerusalem to accept an award. He had been advised, he said, by many of his friends and admirers in Japan, not to go to accept this award because of Israel’s war crimes in Gaza. From this point in his speech it was clear he could go one of two places – to stand forthrightly with Israel (as Rupert Murdoch recently did) or to use his place of honor to criticize. Murakami apparently struggled with what to do – and it was apparent in his speech. He tried to do neither. But he laid out this basic tenet of his philosophy:

“Between a high, solid wall and an egg that breaks against it, I will always stand on the side of the egg.”

Yes, no matter how right the wall may be and how wrong the egg, I will stand with the egg. Someone else will have to decide what is right and what is wrong; perhaps time or history will decide. If there were a novelist who, for whatever reason, wrote works standing with the wall, of what value would such works be?

Murakami explains that the wall can be many things, and the egg many things – but that more than anything else, the wall is the System, and the eggs are individuals:

I have only one thing I hope to convey to you today. We are all human beings, individuals transcending nationality and race and religion, fragile eggs faced with a solid wall called the System. To all appearances, we have no hope of winning. The wall is too high, too strong — and too cold. If we have any hope of victory at all, it will have to come from our believing in the utter uniqueness and irreplaceability of our own and others’ souls and from the warmth we gain by joining souls together.

Take a moment to think about this. Each of us possesses a tangible, living soul. The System has no such thing. We must not allow the System to exploit us. We must not allow the System to take on a life of its own. The System did not make us: We made the System. That is all I have to say to you.

I’ve struggled with this critique of Murakami’s since I read it a month ago. I wanted to dismiss it as too simplistic, too easy. It struck me as – to some degree – embodying the worst of Western leftist movements. At the same time, it reminded me of the critique Ann Coulter, that shrill harpy, made of liberalism in her Treason:

Whenever the nation is under attack, from within or without, liberals side with the enemy.

In her view of history, liberals sided with criminals over law enforcement, terrorists over counter-terrorists, Communists over patriots, Vietcong over the American military, hippies over the cops bashing the hippies in the head. And, though Coulter neglects to mention these: blacks over racist Southern mobs and sheriffs, the poor against a system that allowed them to be impoverished, and the public against faceless, greedy corporations. There’s a certain logic and appeal to Coulter’s view – but to accept it one must first be wiped of all knowledge of American history and liberalism – which is the story of tough, pragmatic choices by men and women trying to uphold the system by reforming it and protecting it. Reform – not treason or revolution – has been the rallying cry of the American liberal.

There is a strain of thinking on the left that is and has been mainly marginalized in America that sees the “System” as the problem. In many other countries in the world, this strain of thinking is more mainstream – as are the leftist movements in those countries. I think what Coulter was referring to in her comment is the attitude that Murakami displayed in his speech – siding with the egg over the wall, regardless of “right” and “wrong.”

And yet, I still struggle with Murakami’s construction. It reminds me of the Catholic Church’s “preferential option for the poor.” And at the same time, it’s modesty appeals to me. Murakami does not say that he is “right” – only that it is his duty, his role to take the side of the “egg.” I believe it is important to have the worldviews of everyone articulated – as it is the only way to understand. 

But after struggling I cannot say I am on the side of the egg or the wall. What I finally realized is that the problem with this construct is not in the description of the egg or the wall – but in the lack of empathy for either side. I think in a real sense, this attitude – “May the egg always be right, but the egg, right or wrong!” – explains and motivates a great deal of the left, with it’s sympathy to any group or individual who presents themselves as attacking the “System” or as a victim of the “System.” Whether that individual be José Bové or a Gazan covered in blood or Hugo Chávez. The problem for me is that this egg versus wall scenario provides no meaningful distinction between Mohandas Gandhi and Osama Bin Laden.

The failure of this metaphor seems to arise – for me – in it’s lack of empathy. The “wall” – or the “System” is itself fragile – and individuals are far more than mere shells containing souls – they interact with the environment, they see, they hear, they make choices. This split between self-contained, solitary individuals and a menacing system is a basic theme of Murakami’s work – and the lack of culture or society within these works is actually what makes them so accessible to a Westerner like myself. At the same time, it makes them surreal. The heightened reality in these novels reveals something true about the nature of our world – but it is incomplete.

Political Philosophy

Economics, Fairness, & Stability

[digg-reddit-me]A friend asked me recently in response to my Reagan Revolution posts:

A. Would you rather have sustained economic growth where 90% of the growth goes to the rich and 10% to everyone else?
B. Economic stagnation and contraction where everyone stays at the same level except the rich lose a chunk of their proportionate wealth?
[edited slightly for clarity]

I think my friend may be surprised at how close America already is to Situation A. The top 20% of Americans own over 84% of America’s wealth and make just under 50% of each year’s income. Of the growth in America’s economy in the past 10 years, most of it has gone to the richest 5%. (See the Federal Reserve’s Chartbook – warning – a massive pdf. Also, for easier to read charts, see this and this.)

The question my friend seems to be proposing is: Is this disparity inherently wrong? Not necessarily. But it raises a number of difficult questions.


Do you really believe that the top 20% of Americans has done work or provided value to society sufficient to deserve 84% of the wealth? If you’re just looking at income – do 20% of the people do 50% of the work each year? Or do these 20% of people provide 50% of all things of value? Is it possible that this distribution can be just? It does not seem to me that it can – unless you postulate that a day’s work for the average person in the top 20% is worth a week’s worth of work for the average American. 


A second question is whether a system in which such a high percentage of income disparity is sustainable. Certainly, when wealth is concentrated to such an extent, it undermines both the freedom of the market and democratic institutions. The freedom of the market is based on competition – which is undermined by the concentration of wealth. Democratic and market institutions are based on a free flow of information which can be controlled with sufficient wealth. For a time, as long as enough people benefited, this might be sustainable – but at some point, the concentration of wealth would reach a tipping point that would force a change. And that is only if all goes well – if growth ceases, or ceases for the majority of the people, then such a system would collapse. (This is what we are facing now.) The only way such a lopsided system could be sustainable would be with massive government intervention to maintain those institutions and mechanisms necessary for stability or intervention to spread the wealth around. 

It sometimes seems to me that conservatives forget that the free market exists because of – not in spite of – government interventions. And that some percentage of an individual’s success is due to the society and market created and maintained at least in part by the government.

The real problem I have with the construct of the question is that it might be asked another way: Would prefer massive injustice or collective misery? I’d like to think we can do better than either.