America's Crashing Clown Car - Part 2

(A Continuation my 5/10/20 article. 

The following was originally posted on 5/17/20 but inadvertently deleted. We're reposting it here  with today's date. The reference in Keith's 5/21 piece is to this article.

Where Are The Democrats Heading? 

            The Democrats' presidential primary campaign has been a struggle between its left wing and its traditionalists. The Party has a problem, however, in that while it's radicals are providing the political force vitale, the Dems' only hope of winning the election seems instead to be in renouncing extremism and presenting a more moderate image to the public. Their debates have been awkward affairs in which the two sides have danced around one another in an effort to keep the radical energy alive and somehow still establish a winning framework for the election.

            The Party has chosen to allow their young NY congresswoman Alexandria Ocasio-Cortez to become the public face for the rising generation of Democrats, and she seems proud of how far out onto the left fringe she has been able to skate. The Party, always prone to hero worship, has even seen fit to bestow upon her one of their coveted three-letter acronyms, usually reserved for their icons. Though barely out of her twenties, she is now "AOC" and stands in the revered company of FDR, JFK, RFK, MLK, and LBJ. Someone is certainly busy marketing her career, and she has become a superstar.

Uncle Bernie 

            Bernie Sanders is a pivotal resource for the Party right now. His avuncular and sometimes even lovable persona reassures the public, even though his politics are extreme by the standards of any past political norms in America. This is, after all, a man who in his youth was a vocal fan of the old Soviet Union and who more recently has had words of praise for the Chavista Government still running Venezuela,  despite horrific evidence there of how his political principles play out in the real world. He has performed invaluable service to the radical wing of his party simply by mainstreaming the term "socialist", which historically had always been a third rail for politicians in this country. It is that no longer.

            Many of his followers today are young enough to be his grandchildren and few of them have the historical knowledge to question Uncle Bernie when he tells them it's now OK to be a socialist. He tempers the reality by describing his ideology as "democratic socialism", although not many seem to pick up on this as the a contradiction in terms it is. If the "Bernie Bros" were familiar even with fairly recent history, they would realize that the thuggish Mr. Chavez wrapped himself up that same Orwellian banner.

            Sanders is, of course, only a transitional figure. His age and poor health have always precluded any serious chance for him to win the Party's nomination this year. However, he holds the power singlehandedly to cost the Democrats this election should he urge his followers to bolt the Party or even simply stay away from the polls. He's not a stupid man, and his objective all along cannot have been actually to win the Party's nomination, but rather to gain control of its direction.

Enter Joe Biden 

            It was revealing, after all the bitterness transpiring between the rival camps, how quickly Sanders swung into line behind Joe Biden as soon as his erstwhile rival appeared to sew up the nomination. Such sudden warmth can only mean that the behind-the-scenes deals had already been made between the two camps. The leftish faction will control the Party's agenda and substantially populate any future Biden administration. The easy rapprochement also probably means that the neo-socialists will own the now all-important choice of his running mate. Everyone knows that, should Biden be elected, his VP might soon look forward to an important promotion.

            Joe Biden is a decent man who has always represented the best the Democratic Party has to offer. While left of center, he's shown respect for his opponents and earned theirs in return. He is, however, a shell of himself at this point and can hardly string five words together without losing his train of thought. He has dementia and would, if elected, be incapable of exerting much will of his own. He would be tightly controlled by the real powers behind his Presidency, who would not be moderates.

            The Party strategists certainly realize the potential disaster they face throwing a man in his condition into the rough-and-tumble of a Presidential campaign. It is my belief that right now they are surely racking their brains in an effort to bring another candidate forward to replace Biden. This jarring development would be highly dangerous for their Party and for our country, but they may well choose to risk it. They will be unwilling to sacrifice a victory that, once again as in 2016, they believe to be now within their grasp.

Election In A Firestorm 

            So what we have this year then is a Presidential contest between a blowhard opportunist on one side, and either a broken man or a last-minute mystery candidate on the other. This burlesque was already taking place against a backdrop of anger and general cynicism, but a new destabilizing factor has now emerged. The COVID-19 pandemic has created a primal emotional panic everywhere and, as an oddly under-appreciated side effect, suddenly forced the national unemployment rate to the highest level ever recorded by the Bureau Labor Statistics. Unemployment is now higher than even during some years of the Great Depression.

            In past generations, national crises have generally united Americans in the fight against a common enemy. Predictably, what's happening now instead is intensifying partisan warfare. Whatever one thinks of Trump's actions so far in combating the emergency, there is absolutely nothing he could have done that would have avoided the bitter attacks being leveled at him by his opposition. Any correct move would have been quickly overlooked in the eagerness to throw light on his next mistake.

            Following Rahm Emanuel's famous advice, our Democrats are seeking leverage from the current crisis and not letting it go to waste. In the vanguard is the strident young AOC, who seems to be taking her cues from the Leninist playbook and it is calling for something akin to a general strike. Once again, the nation's vital energy is being sucked away into the vortex of ugly politics at the very time it's most needed for rational problem-solving.

The Minefield Between Now And November 

            While it is probable that the viral pandemic itself will be receding six months from now, my judgment is that its economic impact will by then be only gaining traction. Small to mid-sized businesses are the lifeblood of our economy, and many of them are being forced to shut down and to furlough their employees. And of those shuttered companies, many will never re-open, leaving employees and operators alike stranded and angry.

            To address the problem, Trump and Congress are suddenly on common ground in their desire to pour oceans of money on it. They're debating only about whether to spend a lot or a whole lot or a whole lot more. And given the magnitude of the collapse, even most free-market advocates are agreeing that massive governmental action is called for now. Most understand that the current implosion is not a normal economic downturn that might reasonably be expected to self-correct. This is instead analogous to a medically-induced coma that requires electro-shock therapy to restore functionality.

            Pushing the metaphor a little further, however, the critical question becomes whether the sick body has the vitality anymore to withstand such treatment.

            The federal budget deficit has been a political bugbear for generations now. Deficit spending has been with us since the earliest days of our republic, when Alexander Hamilton, against strident opposition, forced through federal assumption of the states' Revolutionary War obligations. Part of Hamilton's vision was that this sweeping act would bind them all to the economic development of the new nation, and it worked. Federal debt, once a bitterly controversial idea, has been with us ever since except for a few years during the 1830's when President Andrew Jackson triggered a depression by paying it all off.

Sword Of Damocles 

            Afterwards, the budget deficit ebbed and flowed over the years, but the trend line has been ineluctably up. The consequent debt aggregate has kept expanding. The deficit spiked sharply during the 1930's as government battled the Great Depression and spiked even higher during the WWII years. The great economist John Maynard Keynes provided a theoretical framework explaining why all this was OK at the time, and our politicians - who have their own reasons for embracing federal expenditures and tax cuts - responded warmly to Keynes' way of thinking.

            What they conveniently overlooked was Keynes' proviso that deficits were constructive during economic downturns, but not during expansions, when surpluses were needed as a means both for keeping inflation at bay and holding the aggregate debt down to a manageable level. No responsible economist has ever argued that debt could spike up and up forever without eventually destroying the economy and the currency.

          The only serious debates have been over how to identify and avoid that tipping point.