The Man with the Two-Storey Brain

Classic Simpsons: https://www.youtube.com/watch?v=P9yruQM1ggc

Trope.

The bailout was entirely foreseeable, and the next steps ought to be, too: China will bail out its own industries which are losing in the trade war, and, since China is essentially one big corporation, China can do it much longer than the US can. Thus a trade war could push us into a shooting war, as I summarized here over a year and a half ago when Trump’s bozo shenanigans started. And another thing I predicted: Trump’s policies would reduce multinational business investment in the US, because businesses will not care to risk this much idiocy in US economic and trade policy. In turn, this will decrease long-term incomes and standard of living in the US. Adam Posen just verified that net foreign business investment in the US has dropped to zero: https://piie.com/blogs/trade-investment-policy-watch/cost-trumps-economic-nationalism-loss-foreign-investment-united

What Posen doesn’t point out is that this makes it more likely that US domestic investors will try to get out of the US too, just as soon as better ROIs present themselves abroad. At some point along this logic the Trumpublicans will be forced to institute capital controls…

Winning!

This seems appropriate: https://www.bbc.com/news/blogs-trending-39592010

“On the left if you’re consuming fake news you’re 34 times more likely than the general population to be a college graduate,” says Green. “If you’re on the right,” he says, “you’re 18 times more likely than the general population to to be in the top 20 percent of income earners.”

And the study revealed another disturbing trend: the more you consume fake news, the more likely you are to vote. It’s “fascinating and frightening at the same time,” says Green.

Buckle up!

Wildly funny to watch the diehard neoliberal cheerleaders condemn Trump’s lunacy while giving the even more demented lunacy pushed by Larry Summers/Brad DeLong/Tim Geithner/Bill Clinton/Barack Obama/Hillary Clinton and the rest of their “globalization forever!” coterie a pass for the last 30 years.

Flip the Wayback machine to the late 1990s: Bill Clinton and his team of Harvard-trained genius economists decide to crank up globalization. Don’t worry about those tens of millions of high-paying jobs that’ll get shipped overseas, they tell us…we’ll substitute “knowledge workers” for those factory jobs! Right? Riiiiiiiiiiight.

https://www.thenation.com/article/harvard-boys-do-russia/

https://www.thenation.com/article/note-to-hillary-clintonomics-was-a-disaster-for-most-americans/

https://www.nytimes.com/roomfordebate/2013/11/24/what-weve-learned-from-nafta/nafta-lowered-wages-as-it-was-supposed-to-do

https://www.epi.org/blog/fast-track-to-lost-jobs-and-lower-wages/

Who really benefits from free trade AKA offshoring every jobs that pays a living wage to overseas sweatshops? The CEOs and rich shareholders of giant monopoly corporations whose profits soar when they can build iPhones using workers who get 50 cents/day. These CEOs use the fantastic profits from free trade to buy back the shares of their stock, boosting share prices and making the rich people who own stocks and CEOs who get paid in stock options obscenely wealthy…but the average worker gets nothing from free trade. Nada. Zip. Dick. Squat. Zilch. Bupkiss.

https://hbr.org/2014/09/profits-without-prosperity

Fast forward to 2018 and the entire midwest of America has collapsed into a deindustrialized fentayl-addicted wasteland, while Chinese are buying up luxury homes and condos at a staggering rate on both East and West coasts even as our biggest American companies are shipping high-paying jobs (or automating ’em out of existence) even faster.

Now along comes Lee Arnold to explain to the audience of Crooked Timber (advanced degrees all, smug ‘n cozy with their bullshit jobs that pay $150K/yr like “Tittle VI compliance officer” and “supply chain consultant” and “HR diversity coordinator” and “foreign investor realty purchase liaison”) that Trump’s insane policies will destroy America:

“And another thing I predicted: Trump’s policies would reduce multinational business investment in the US, because businesses will not care to risk this much idiocy in US economic and trade policy. In turn, this will decrease long-term incomes and standard of living in the US. ”

This actually sounds great for the average person. Bad for the people with PhDs and bullshit jobs who post on Crooked Timber…because “multinational business investment in the US” mostly boils down to wealthy Chinese buying up luxury homes and apartment buildings in major coastal cities in America, Chinese princelings (grandsons of Mao’s surviving compatriots on the Long march) driving American businesses into bankruptcy by predatory-pricing service industries that pay American workers far-below-minimum wage temp part-time “gig” jobs, and Chinese state-owned industries snapping up American startups to crush competition before it starts.

Trump is demented and his policies are insane. Still, massive tariffs will be great if they shut down globalization. Because either globalization ends, or America does. If globalization isn’t shut down, the country will burn. You’ll see cities in flames. Because the only people who benefit from globalization today in America are the parasites with bullshit jobs like “supply chain consultants” TRANSLATION: “We show you how to offshore you entire operation to China and substitute Chinese slave labor that gets paid 50 cents per day for workers who get paid $7.25/hr in America” and realtors who will lose those sweet sweet commissions on those million-dollar condos all the wealthy Chinese are buying in San Francisco and Seattle and Los Angeles and Portland OR and Boston and New York as a way of laundering their Chinese currency.

https://nypost.com/2014/07/26/why-10b-of-chinas-money-is-laundered-every-month/

Lee Arnold claims Trump’s tariffs “will decrease long-term incomes and standard of living in the US.” What unbelievable tripe. The only long-term incomes that will be decreased by tariffs on predatory dumping industries in China are the long-term incomes of the predatory job-offshoring CEOs of Apple, Google, GE, IBM and the rest of the parasites, along with their wealthy shareholders. The rich people who own Apple stock will wail and gnash their teeth and tear the hair, but the average worker won’t notice a damn thing. You know why? Because 94% of all the new jobs created since 2005 are low-wage temp gigs that pay far below the minimum wage. Jobs like Uber driver, 96% of whom stop working for Uber within a year. Jobs like Amazon warehouse worker, that last just until you’re injured badly enough you can’t continue (or until you can’t make the payments on the car you’re living in while you work there). Jobs like part-time Starbucks barista and part-time Deliveroo driver.

https://qz.com/851066/almost-all-the-10-million-jobs-created-since-2005-are-temporary/

https://www.theguardian.com/commentisfree/2017/dec/02/nomadland-living-in-cars-working-amazon

Explain to me how lack of foreign direct investment in America will destroy jobs like Uber driver or Starbucks barista or Deliveroo driver. That’s obvious claptrap. The sh*te jobs of average Americans won’t be affected in the least by a collapse in foreign direct investment in America, the only jobs that will be affected nowadays are the parasite realtors and the supply chain consultant leeches and the rest of the bullshit jobs by people with advanced degrees from the Ivy League who profit from the decay of American society.

https://www.vox.com/2018/5/8/17308744/bullshit-jobs-book-david-graeber-occupy-wall-street-karl-marx

https://www.amazon.com/Griftopia-Bankers-Politicians-Audacious-American/dp/0385529961

The best and brightest in America now make Himalayan mountains of cash from the forces that are destroying our society — the privatization of government services by offshoring ’em and automating ’em, the sale of local and municipal assets like turnpikes and parking meters to overseas investors in China and Dubai and the UAE, the sale of insanely overpriced luxury cars and luxury jewelry and yachts and grotesquely overpriced luxury mansions and condos and high-end apartment buildings to sex traffickers and drug smugglers and conflict diamond exporters in China and Colombia and Sierra Leone and the Gold Coast of Africa who need to launder their dirty money.

http://www.latimes.com/business/la-fi-foreign-buyers-20170718-story.html

Meanwhile, even highly educated Americans now live in their cars and turn to part-time sex work to survive:

https://www.theguardian.com/us-news/2017/sep/28/adjunct-professors-homeless-sex-work-academia-poverty

The reality is that Trump got elected for a reason: the average person realized that either globalization dies or America does. Obama’s crazy effort to ram through the corporate-coup TPP, Hillary’s adoration for endless unwinnable foreign wars and limitlessly offshoring of U.S. jobs offer the prospect of world where the average American lives in a favela driving part-time for Uber while rich foreigners own all the penthouses and all the decent-paying jobs have been offshored or automated out of existence.

https://www.wsj.com/articles/western-cities-want-to-slow-flood-of-chinese-home-buying-nothing-works-1528294587

https://www.theatlantic.com/business/archive/2010/10/why-does-abu-dhabi-own-all-of-chicago-s-parking-meters/339805/

Of course the Ivy leaguers with advanced degrees and bullshit jobs work overtime to deny this, claiming it’s all about racism. People on the ground understand the brutal equation of early 21st century: better to live in an America where laptops cost $4000 due to tariffs but Americans have high-paying jobs to save up to buy ’em, than to live in an America where laptops cost $400 but your part-time low-wage temp “gig” job pays $1.37/hr and you can’t even afford to buy food to eat, let alone a laptop.

https://www.theguardian.com/commentisfree/cifamerica/2011/aug/16/obama-free-trade-midwest

https://www.huffingtonpost.com/entry/yelp-employee-fired-after-complaints_us_56ca00bee4b041136f1760eb

Yes, Trump is insane and a fascist. Yes, his cabinest is infested with corrupt sociopaths. Yes, the Trump administration’s policies promise to do for America what the Black Plague did for Europe.

That said, if Trump inadvertently succeeds in shutting down globalization, every American (except the parasites with bullshit jobs that depend on shipping high-paid U.S. jobs overseas or automating ’em out of existence) will benefit.

@11 first, congratulations on the book deal. I wouldn’t know good stats from bad and I’m always unlikely to believe any claim that begins with a variation of ‘4 out of 5 users contacted report…’ I do believe that academics too often treat other academics as a kind of morally-superior priesthood – free of quacks, grifters and other charlatans .

Which leads to mclaren’s magnificent @10. Thank god there’s at least one person who understands that fear of tech and outsourcing (plus the opioid addiction) is what’s driving Trumpism/Sanders support, and other manifestations of ‘enough already!!’ Contra JQ 30 percent of Hispanics supported Trump, many of them Cubans. Are they afraid of brown people, too, and just don’t know it?

Japan is suffering just like America. Regions that once hosted factories have been hollowed out, young people leave, and millionaires from China and Russia arrive to buy the best stuff as they can. The elites are based in Kanto with exactly the same operating procedures and contempts as their American aristocratic peers.

And, as mclaren points out, there’s nothing at all new in all this. One of my first teaching gigs was working with a planning group for a large Japanese electronics company in 1994. Their entire agenda was trying to figure out how to close as many factories in Japan as possible, as quickly as possible, and move them offshore where worker conditions are as bad, or worse as described in @10.

So, now I ask my students from hollowed-out economies whether they’d like to see someone stand up and demand Japan’s factories move back to Japan. Three guesses the response. Yes, I know the next part – export economies etc. That’s not the point.

Globalization and automation are the hammer and anvil crushing the hopes and lives of ‘just folks.’ And thank god ‘just folks’ have decided to back Trump. Sanders would have been the better option, but her majesty and 44 helped kill that possibility.

Why did it have to be Trump? That’s a great question. So, let’s not ask it. Let’s talk about Russia! The short answer is that nobody else could be bothered to make the trip to Wisconsin and even pretend to give a shit. The good news? Lots of just folks on the left and right are awake. Very much contra JQ, it’s about getting screwed by corporations, elites and slave labor at home and abroad – not ‘race.’

McLaren was too nice, however. I’d like to think that teachers’ unions and other big fund buyers aren’t buying Apple stock, etc. But many are! Some folks might not know that many of the larger, most horrific, slave plantation in the Antilles in the 18th-century were owned by elites and by groups of investors based on the other side of Atlantic (hat-makers, e.g..) in regions across France, and Europe.

Good times! Check out my 401k!

PS, thanks for congratulations!

@McLaren — “diehard neoliberal cheerleaders… advanced degrees all… high-paying jobs that’ll get shipped overseas… Who really benefits from free trade…? …the entire midwest of America has collapsed… The reality is that Trump got elected for a reason… deny this, claiming it’s all about racism…”

Boy do you misunderstand me. I live in a sea of Trump voters and I know exactly why Trump got elected. I’m a bluecollar college dropout and you should study more. You’ve got the right problem but the wrong solution. Globalization/neoliberalism has accelerated the unemployment which would be happening IN ANY CASE. Question is what to DO about it. The factory jobs are disappearing everywhere on earth: all new factories in the US will be largely automated: there are going to be less high-paying jobs in manufacturing. “Knowledge jobs” didn’t pan-out for enough people, yet even now some economists (not all, thank god) are still pushing them as part of the solution; I think that’s also a lost cause, since software is going to be automating itself, and ALSO because consumers do not have unlimited infinite wants (contra the bullshit in textbooks) particularly for knowledge goods; and the knowledge goods they have time for, don’t employ a lot of people (e.g. Facebook, around 25,000 employees). Little-known fact: the “theory of free trade” since the 1830’s has mandated “compensation” INSIDE each country (i.e. the winners of free trade living inside a country would compensate the losers living inside the same country), doing this either by 1. gov’t redistribution or else by 2. the invention of NEW goods and services, so the disemployed losers to free trade could be re-employed and get back in the market game, whether that’s local markets or international. Well, THAT doesn’t happen — gov’t redistribution is a socialist no-no to the no-nothing libertarian freemarket maniacs; and the other solution, inventing new goods and services? –for some reason yet to be plumbed, the entire capitalist midwest of America did NOT invent new goods and services to get back in the market capitalism game when globalization stole their jobs. Wait a minute, why did THAT not happen? Don’t bother asking them, you’ll get a blank stare like deer caught in the headlights. Because it refutes their OWN favorite midwestern individualistic freemarket theory that capitalism can work. …So, somebody here ain’t thinking right, and it’s not me. What you COULD do, is think beyond all that stuff you linked to, and consider the obvious conclusion, that capitalism is so successful that it is putting itself out of business. And we are lurching in the throes. The people who are benefitting financially during this transition — multinational capitalists who profit financially from globalization — are controlling the political debate in most countries and and they have so much money they don’t even know what to do with it all, even in the international setting, it’s been going into debt assets for 40 years, most recently and spectacularly into real estate prices (via mortgage derivatives) almost everywhere and even that didn’t work to get the whole thing going again. Because it turns out that, once again, capitalist economists were wrong about how to prime the pump successfully. What we NEED are gov’t redistributions from the richest sectors, targeted to certain specific ends (health, education, environment, a UBI or jobs guarantee) for everybody regardless of their income, at the same time as the whole global economy moves into an new era of arts, crafts, learning, travel and more leisure. What we are going to get instead, particularly if a higher R.O.I. appears in a global freemarket that shuns the banana-Trumpian US, is a sudden massive move of big money out of the US. And THAT, in turn, will cause a fascistic response inside the US. So “shutting down globalization” is the DUMBEST IDEA EVER, particularly because we have entered the historical moment in which China wants to dominate world trade, and can cook its books forever to make it work. The Chinese will present a higher R.O.I. somewhere which will even lure Trump & his cabinet to abandon the US… etc. etc. –Which is how I got to my comment in #6 that you take such indignant exception to, though I had to leave out a bunch of details that you haven’t learned about.

P.S. Such as, wages are partly separated from the standard of living. For example, wages could go down, and the standard of living could go up at the same time. One of the biggest obstacles for students just learning economics.

John, the way your using statistics on 11 and 13 is a common mistake, so I can’t blame you for falling into the trap, but it isn’t helpful.

The best indicator of how someone will vote is always “how did they vote last time?” It is a much better predictor than education, or gender, or income level, or geography, or race, or anything else that we talk about on a regular basis. (Who your parents voted for is also better than most of those). Call it tribalism or whatever you want, but people change the party they vote for on a particular type of high level candidate (president, governor, legislative representative) about once per lifetime, and often not that often. So “how did they vote twenty years ago” is also more predictive than almost any other measure. That’s also true for self labeled independents, who may split on minor down ticket candidates but are very reliable on the big ticket votes.

But in close elections the action is on the margins. So essentially all talk about everything that “motivated the voters this election” is really about “given the fact that almost no one changes, this is what changed…”

Also, since almost no one ever changes who they vote for, when something does motivate them to change, that can be important to note. So if globalism concerns motivate enough people in 2016 that it causes a change in a tiny minority that used to very reliably vote for Democrats, that really can swing elections even if the vast majority of people just went with “who I always vote for”. You’re correct that we shouldn’t say that Cubans voting for Republicans can be attributed to concerns about globalism. Like everybody on both sides they vote for whom they’ve always voted for motivated by whatever sociological reasons motivate that behavior.

But when people change sides, often for the only time in their lives, and statistically speaking often not coming back, that can often be traced to specific concerns because they broke with the strongest statistic—that people vote for whom they ‘always’ vote for. So when people attribute the Trump victory to racism for example, that looks odd because the key places he won are also places that Obama won. You can say all sorts of things about racism and Republicans in general, but those are about people who have been voting for Republicans their whole lives. In Clinton’s loss a few key states that had reliably voted for Democrats, and had voted for Obama twice, had a few tens of thousands of people who switched sides. Attributing that to racial animus seems at least a relatively hard thing to justify. If race concerns were going to animate a switch, they had one of the best opportunities ever—just one and two elections before they could have voted against a black president.

The biggest statistical fact in elections is that people almost never change who they vote for. As a result of that fact, people who change that once or twice in their lifetime create intense interest. It makes no sense at all to dismiss that with “well most other people voted for the side they always vote for”. It’s statistically true, but not helpful.

I think mclaren and ph grossly exaggerate the material suffering of the US population. The vast majority of Americans live long healthy lives, do their shit jobs but have leisure time, disposable income, good health care…they’re satisfied with their schools, satisfied with their congresscritter, they’re living longer, they live in communities with less crime, they have unprecedented access to consumer goods…they’re conventionally okay in a way that takes a steady drip of anxiety and hurriedness as given.

The implication of their critique is that, short of the promise of 80% of Americans living in affluent suburbs with an annual 2 week time share, there’s a revolution brewing.

This misdiagnosis of the nature of widespread social hardship, which is only tangentially related to personal income and wealth, feeds the narrative (inadvertently, I trust) that what we really need is more consumption.

It is remarkable, however, that in the midst of one of the largest economic expansions in history, it is apparent that Dems and R’s increasingly win elections by going populist. That’s pointing at something, but it isn’t pointing at the absolute material hardship of the populace.

[congrats on the book JQ, looking forward to reading it]

ph @ 12

Sitting in a bar in San Juan once during the 70s, I said to a New Yorker who identified as Cuban, “It must be nice to be in a place where you hear Spanish all the time,” and got the response, “That’s not Spanish. Puerto Ricans are animals and the language they speak is from the gutter.”

Pretty sure she didn’t see herself as a “brown person,” and that she saw a lot of other people as such.

I have no idea how generalizable this is, but I suspect that many of the people who fled Castro thought of themselves as white, and were perfectly okay with Republican efforts to keep the darker people down, as long as they were also refusing to normalize relations with Castro’s Cuba and as long as Cubans automatically went to the front of the immigration line.

I do know that I’ve read that in Cuba itself, even decades after the revolution, there’s still considerable prejudice against Afro-Cubans.

I wouldn’t be surprised to discover that younger Cuban-Americans are moving beyond that in ways that lots of young Americans seem to be. Hope so, any way.

The point is that racism s is multi-dimensional and can be deployed in a multitude of ways. Pretty much all Americans (both continents and everywhere between) have something going that way. That conservative racism is more overt and nasty than some other kinds is no reason to suppose that it’s the only kind. (Remember Biden calling Obama “articulate” in that condescending liberal way in 2008?)

I’m hoping that someone on this thread as a better grip on Cuban and Cuban American racial attitudes, and can instruct us.

Fredrik Pohl’s The Midas Plague and The Man Who Ate The World are both about much the same issue — although both are concerned with the crisis of robot overproduction, which is eventually resolved by producing robots which consume enough to resolve the crisis. Pohl doesn’t mention what happens when the resources run out — although Pohl and Kornbluth’s The Space Merchants gives a clue.

Incidentally, the rant about globalization reads pretty well, but I don’t think global trade is going to be democratised any time soon.

Things that aren’t happening in Japan:

https://www.bloomberg.com/graphics/2017-japan-inequality/
Good graphics and commentary.
One of many, plus scholarly studies – Google keyword search: ‘japan regional inequality’

https://www.nytimes.com/1993/08/29/world/japan-s-companies-moving-production-to-sites-overseas.html
NYT possible pay-wall
– …search: ‘japan offshoring factories’

https://www.bloomberg.com/news/articles/2015-07-06/japanese-companies-keep-moving-factories-overseas Yes, just like in America.

https://www.cfr.org/backgrounder/abenomics-and-japanese-economy
“In 2017, household spending dropped 0.1 percent and real wages decreased by 0.2 percent. Wages have fallen 9 percent in real terms since 1997.”
-… ‘Japan two-tier economy’

https://www.rappler.com/business/industries/95369-japanese-manufacturers-china-relocate-philippines
-…’Japan wants factories’

The last key word search in English confirms that Japanese companies prefer to manufacture offshore. The tensions I’ve described are those detailed first-hand in English by students from various regions studying at three universities in the Tokyo region.

Many of these students would prefer to return to live with/close to their families; many would prefer to live and work in Tokyo. You’re welcome to ignore anything I write on Japan, and any other topic. Unlike my fan-boy I have family in Japan, own a home here, and have a number of Japanese family members who provide me with their own reliable information, not too mention countless friends, former students, and contacts in various governments and companies, some at a very senior level. I don’t drink or smoke myself, but I can attest to the fact that excessive alcohol consumption and throwing-up in public are both very Japanese things to do.

I’m frankly astonished anyone would suggest that regional inequality is not a factor in Japan, as it’s probably the most important and potent issue facing all the Japanese folks ‘unlucky’ enough not to live in Tokyo, or Osaka, and has been for some time. There’s plenty of literature in English on the topic. Not everyone wants to live in London, or New York. Hard for some to believe, it seems.

Finally, an article on how this regional depopulation is affecting universities: https://www.japantimes.co.jp/news/2017/06/27/national/japans-regional-universities-innovate-survive-amid-depopulation-tokyo-draw/#.W1rzjH59hE4

Yes pH there is regional inequality in Japan. Well done, for once you almost got something right! Now if you really try you might be able to identify the causes, and assess whether there are any govt or corporate solutions in place in Japan that are not in the USA. I don’t look forward to your efforts though.

Sebastian @18 You have the argument back to front. Precisely because elections are (mostly) decided by small changes, interpreting narrowly decided election outcomes as representing massive shifts in public attitudes (as McLaren and ph want to do in this thread) is a mistake.

Of course I make no mention of those things pH, because your original comment was drawing parallels with America’s experience of globalisation, not contrasting life in a one party semi-socialist state with a two-party oligopoly. Of course you shift the goalposts now because you’re not here to advise or to learn but to do a gish gallop of bullshit. It is no surprise then that you don’t even understand your own comment that I was objecting to, because as we have seen repeatedly here you deal with generalities, stereotypes and lies, not facts.

Fun facts about Japan.

‘ The CIA secretly sent money to the Liberal Democratic Party in the 1950s and 1960s to help stabilize the LDP-led government and prevent a leftist administration from emerging, according to a U.S. document released Tuesday.

The document, titled “Foreign Relations of the United States, Vol. XXIX, Part 2,” also suggests that some of the CIA money went to moderate members of the now-defunct Japan Socialist Party, the LDP’s rival at the time, apparently to help them form a moderate breakaway.

It is the first time the U.S. government has formally admitted having a covert financial program for Japanese politicians, a State Department official involved in compiling the document said.

The LDP has denied the CIA give the party financial support.

The document says the U.S. government approved “four covert programs to try to influence the direction of Japanese political life” from 1958 to 1968.’

https://www.japantimes.co.jp/news/2006/07/20/national/u-s-admits-cia-gave-ldp-money-in-1950s-1960s/#.W1w58NJKjIU

CF also
https://www.thedailybeast.com/japans-justice-minister-to-resign-over-yakuza-ties

I just have to interject, as a curious Hoosier, as to why ph is feels so strongly about . Is America really suffering from these small town Democrats? Is the Public still sore of Geo. Watkins’s first place showing at the Pumpkin Showing? Why the sudden bile directed towards this sleepy Midwestern town?

[Note to moderators: if the HTML above is totally mangled and awful, feel free to block/delete/edit. My snark isn’t worth uglifying the comments]