Economics

In the last three weeks, I’ve grown increasingly saddened about the state of American politics and have begun writing increasingly personal articles about it. These aren’t about policy issues – they’re about deeper concerns over the direction we’re headed.

In my last update, “My Old School“, I mentioned a piece I wrote about a recent visit to my old high school. This brought back memories of various student government battles from decades ago – the productive results of which were still visible decades later. As I wrote in that piece,

Back then, we talked across belief structures about real-world results – and, as a result, improved conditions for most of us…. In almost all cases, compromises were achieved based on practical realities, not dug-in positions, on even the most controversial issues. Adults and adolescents, jocks and nerds, overachievers and slackers – they all understood one basic fact: Like it or not, we were all there together.

The next week, in “A ‘Genius’ like Trump,” I addressed the New York Times story on Trump’s $917 million tax deduction. In my view, most commentators focused on the wrong aspects of this story. Sure, it’s rather shocking that anyone could run up a nearly $1 billion loss – in the casino industry! – and then claim that his business chops are his main qualification to be president. But there’s nothing wrong, let alone illegal, with writing off that loss on your taxes – or carrying it forward for as many years as necessary to balance off profitable years. It’s a valid part of our tax code – particularly for the help it provides start-ups, the major creators of jobs in our economy. Rather, what really – and personally – offended me about Trump’s operations was how he restructured after he made such bad decisions that they cost him $1 billion:

When the recession hit several years ago, I faced an unpleasant choice: Suffer a loss on the year equal to about three years of profits, or lay off most of my employees. For better or worse, I believe that the way to make a business work is to stand behind your employees when times are bad. I took the loss…. The business recovered, enough that I was eventually able to sell it – and I preserved the jobs of all my employees and contractors as a condition of the sale.

According to the Times story, in contrast, Trump’s genius involved stiffing his creditors, laying off more workers than other Atlantic City casinos, shorting his contractors, driving the equity of investors down to about 0.5 percent of what it had been and then restructuring his operations so that, when all around him lay in ruins, Trump was able to pay himself $45 million a year for continuing to preside over this disaster and then shelter that income from taxes, perhaps completely. The billion-dollar pain cost others around him – his lenders, investors, vendors and employees – most of their incomes from the same venture. But not him. And that’s the kind of genius most of us will never be.

Last week, of course, brought the continuing revelations about Donald Trump’s treatment of women, and the execrable second debate. As I wrote on Friday in US News, in A Morality Test for Leaders, what’s wrong extends far beyond Trump’s misogyny – bad as it is – to encompass something I hinted at in the two prior columns: our entire abdication, as a society, of true concern for morality, in large part, I argued, because we’ve allowed “the hijacking of ‘morality’ in recent years to concern nothing but sexuality.” I asked, “What’s the real disgust at” Trump’s or Bill Clinton’s behavior?

For most, I’d assert it’s not a Puritan revulsion to sex: It’s the extent to which these purported leaders care about themselves more than others. Authorities from Hillel to Jesus to Kant point to this (Golden Rule, anyone?) – not sexual discretion – as the central issue of morality….

The relevant moral question is the degree to which those who seek to lead in fact care about Something Greater Than Themselves…. [T]hat’s the test of morality that we ought to demand of our leaders – and the discussion we ought to be having. We have abdicated that discussion on all sides, however, which is what I find most dispiriting about the World Wrestling Federation spectacle that our presidential election has become.

If you want to know what I think that means as to the choice we face in the voting booth next month, you’ll have to read the piece.

As always, I would love to know your thoughts. Feel free to leave your comments below.

The major event of the last two weeks, of course, has been the horrific shooting in Orlando. We all are saddened by the senseless loss of life, but the incident predictably turned almost immediately into a political football over the issues of terrorism and firearms. These are important issues, of course – but a lot of the commentary around them glossed over the underlying theme of the Donald Trump/Republican reaction, and of the year’s politics more generally: that the greatest threat facing the country is “political correctness.”

Facially, the “political correctness” argument of the Right suggests that the US has grown weak both abroad and at home because of liberal-induced unwillingness to deal with – or even utter – so-called hard truths, generally critical of people of color. But, as I wrote in my new piece, ‘Political Correctness’ Isn’t the Problem, in US News & World Report yesterday, the real point such polemicists as Trump and Rush Limbaugh want to make is that the militancy of their anger is really the fault of their opponents:

The spread of intolerant liberalism, which ought to be an oxymoron, however, unfortunately gives the Right in this country – which historically embraces the suppression of speech with which it disagrees – a fig-leaf with which to dress itself up as the defenders of the First Amendment.

So, sure, “political correctness” is a problem. But it’s not what’s stoking Islamic fundamentalism.

Rather, it’s become simply an excuse. An excuse to blame one’s opponent for one’s own venality. An excuse to say even more stupid things, and to elect a fundamentally unhinged man as president, just because doing so is politically incorrect.

This is the big problem of 2016. Last week in US News, I tried to address another aspect of it – the attempt to blame all this anger on immigrants, and what can be done to counter that. In How Clinton Can Win Over Trump Voters, I drew on another meeting from my recent Scandinavian trip in which I discussed immigration policy with analysts from the Swedish Social Democrats. As I wrote there,

[T]he angry working class is right to be angry about jobs and wages: Their jobs have been – and continue to be – threatened. But it’s not because a bunch of immigrants have come over here and taken those high-paying manufacturing jobs. It’s because those jobs, to the extent they still exist, have been shipped overseas. Yes, U.S. jobs are threatened by lower-paid foreigners, but abroad, not in the U.S.

I argued that “American workers deserve a platform that combats the real problems” – and tried in the remainder of the piece to sketch one. The other day, the Aspen Institute asked me to lay out a longer and more detailed version of this argument. Look for it in September!

In between, my trip to Sweden and Estonia produced another piece that I didn’t do much to circulate because it came out right before the Orlando shootings. But in Less Government, More Socialism, I returned to several of my favorite themes on the future of government (basically, “it’s complicated”) and the deficiencies in our current political debate (it’s not complicated enough):

In short, our domestic political debate is grossly impoverished by our dichotomy between the competing utopianisms of a country without government and one dominated by it. We in fact are headed toward a world with a lot less government – and a lot more “socialism.”

And that’s the big problem of the future…. I’ll be discussing it a lot more in articles and posts to come.

As always, I welcome your comments below.

2015 has been a good year for my consulting firm, Public Works LLC.  We’ve had 23 consultants and staff at work on over a dozen projects stretching from Alaska to Puerto Rico, and covering all the firm’s major areas of traditional strength.

As always, the bulk of our work has come in government spending and efficiency.  We were retained to help close budget gaps in two of the most high-profile fiscal challenges in the country:  Over the late spring and early summer, we worked with Puerto Rico Senate President Eduardo Bhatia to help stanch the flow of red ink in the Commonwealth’s budget.  I wrote about the Puerto Rico budget situation this past summer  and appeared on a panel to discuss possible solutions on Capitol Hill last month.

Meanwhile, we undertook similar work in late summer and early fall to address the City of Chicago’s budget gap.  Thanks to union leaders like Chicago Federation of Labor President Jorge Ramirez and conscientious city officials like budget director Alexandra Holt, we helped to develop a package totaling over $100 million in savings.  We rounded out the year improving the fleet efficiency of one of the largest independent public authorities in the country, and launching an efficiency review of the county government in Travis County (Austin), Texas.

The year opened with finishing development of a strategic plan for human services in Broward County (Ft. Lauderdale) Florida, and launching a review of the Alaska Department of Health and Social Services.  Our final report in Alaska was just released publicly last week.  Meanwhile, we’re providing the subject-matter and analytic expertise on a 5-year, federally-funded study of minority health disparities in Virginia.

We’ve also been expanding our education footprint, with a performance review of four school districts in South Carolina, and two more reviews now underway in Alaska, of both the state’s preK-12 and higher ed systems.  Meanwhile, we’ve spent the latter half of 2015 preparing the Comprehensive System Improvement Plan for Rhode Island’s workforce investment system, the subject area in which we’ve probably undertaken the most work in recent years.

We’re expecting 2016 to be even better:  Half of these contracts extend well into the New Year, totaling 70% as much work signed on already for 2016 as we had for all of 2015.  We’re therefore expecting a close-to-record year in 2016.  We’re also expecting some major announcements early in the New Year, so stay tuned!

In the meantime, all of us at Public Works wish all of you, and your families, a healthy and happy holiday season.