Amazon Makes Prime Fools out of NYC and DC

The Shire has been on sabbatical for awhile – some exciting family opportunities left me with no time to write. I’m glad to be back.

Amazon Wants to Get Paid

Over the past year, the great Amazon auction played itself out. As most of you know, Amazon announced plans to build a second headquarters, and opened an auction to find out which city would pay most for the “privilege.” 238 entities (including, Londonderry, NH, Frisco, TX, and two dozen Massachusetts towns) tried their luck, but (surprise!) Amazon picked New York City and Northern Virginia (Washington, DC).

NYC and DC Oblige

NYC and DC paid dearly for the honor. New York offered $2.8 billion in subsidies, and Amazon agreed to create 25,000 jobs. That’s a cool $116,000 per job.  That money could have been used to cut NYC’s corporate tax rate by 5.42% (benefiting all companies), significantly upgrade New York’s roads and bridges, or spent on other needs.

Virginia ponied up over $768 million in direct subsidies and spending for the same 25,000 jobs — a relative bargain at $30,720 per job.  Virginia is raising taxes (via a continued hotel tax) to help raise the money.

Amazon

This time, Amazon Crushed NYC & DC

This is insane.

Incentives Weren’t Necessary

Even if you believe incentives can kickstart a moribund economy or put a small city on the map, neither NYC or DC need that sort of help. NYC is already the world’s most important business and financial hub; Business Insider ranked New York as the world’s number 2 tech center.  NYC is home to IBM, Soundcloud, Spotify, E-trade, Bloomberg and dozens of others. It also has the kind of highly educated workforce, sophisticated transportation network, lifestyle and education options that Amazon desires. In other words, the subsidy was unnecessary.   Proof?  Amazon rejected a $7.5 billion richer offer from Maryland.

New York

NYC — not a Small Town

Also ranked in Business Insider’s list of the world’s most important tech centers, DC is a large and economically prosperous region, due significantly to the federal government behemoth (which can’t relocate). It also boasts the kind of workforce, lifestyle amenities and buzz that Amazon is looking for. Unsurprisingly, studies show that corporate incentives are not why companies pick a site (sorry Maryland!), and that they do not pay out.

Let’s take Northern Virginia as an example.  In the best case scenario, a couple moves to Virginia and earns $300,000 (Amazon promised to pay at least $150,000 per job). The average tax payment at that income level in Northern Virginia is $16,541. That sounds good — Virginia will recoup its investment in a few years. But, that misses a key point – newcomers bring costs too. For example, Amazon’s new home county (Arlington) spends $19,340 to educate each student. So, if our couple has a couple of kids, Virginia may actually lose money. That doesn’t even account for the increase in costs of roads, police, fire, etc.

The Hidden Cost

Harder to quantify, but real nonetheless, is the cultural change that New York and Washington have just created.  Culture is hard to define or articulate, but it is the glue that holds society together.

Queens Protest

No Thanks, Amazon

The Queens neighborhood that Amazon will enter is a former industrial zone that has morphed in recent decades into a mixed neighborhood containing housing, arts organizations, museums, small retail shops, and local offices of companies like Uber and Ralph Lauren. 6250 units of housing, some of which were going to be low-income, were planned for the Amazon site.

This self-described weird neighborhood “full of scabby little brick buildings” will be utterly transformed by the Amazon move.  Local landowners will benefit.  Others will suffer — in particular, poorer, less skilled people will be forced out as the area gentrifies.  The 6,250 units of housing are officially gone, and the rest of the community is at risk. If it’s organic and real, gentrification is a good thing — however, a government-sponsored gentrification scheme to benefit one company is wrong.

Amazon has no presence in these areas, no cultural identity, and neither has nor inspires any loyalty from the people of NYC or Washington.  Yet, state and local governments gave Amazon an enormous subsidy that will change the physical environment and social culture of those areas.

There’s Got to be a Better Way

NYC and DC will also need to keep taxes high or raise them to fund their Amazon subsidy.  And, by transferring dollars and land to a big outsider, they have made it harder for homegrown companies to compete.  That’s bad social and economic policy.  And, for what?  Amazon will always be a Seattle company — these “2nd Headquarters” won’t change that.

Amazon Seattle

Seattle will always be Amazon’s home

DC and NYC are already international cities — adding Amazon won’t burnish their reputations.  But, local politicians just can’t help themselves — they want to be seen as “doing something” to grow their economies.  The right way to do so — reasonable taxes, sound regulation, good infrastructure, high-performing schools and sensible governance — just doesn’t grab headlines.  And, when neighboring cities are offering incentives, there’s overwhelming pressure to compete.

One idea to fix this mess is to have states sign a compact agreeing not to offer incentives to companies.  That makes sense, because it would remove some of the pressure to pay these bribes.  I hope policy-makers consider this solution or others to end these unnecessary and harmful subsidies.

Don’t Live Like “a Boss”

I keep seeing an ad by the car-company GMC.  The ad asks “How do you want to live?  As a decent person? Not a bad guy? A good friend? Is that it — good? Of course not. King of the hill? Better. Top of your game?  Win. All-powerful, like a boss, like a standard bearer, like a pro. We couldn’t agree more. We are Professional Grade. GMC.” (see the ad here)

GMC 2

Not the Boss of Me

While this is just a car ad, it’s emblematic of a major and unfortunate change going on in America.  America was built on several cultural ideas.  We understood that a successful life was built on belief in God, being a faithful and loving husband or wife, hard work, following the rules, and caring about your neighbor.  Unlike the European Old World, where class and breeding defined what success could mean, in America the farmer, mill worker, shopkeeper or teacher could live a life that all would pronounce as meaningful and honorable.

The GMC ad mocks these virtues, and this life.  Decency and goodness are things to be chuckled at, not aimed for.  Instead of a life of quiet virtue and service, GMC tells us to “win.”  But wait, that’s not good enough.  Instead, you need to become the boss, the King, even all-powerful.  Only then will you be satisfied.

Leaving aside the ridiculous notion that a car could help you achieve any of that, let’s explore what the ad is really promoting.  GMC’s ideal is individual domination.  You can

Lonely Man

It’s Lonely at the Top

be King of the hill, you can win, you can be the boss.  Unlike the chump who is “decent” and a “good friend,” the GMC man, having vanquished all, stands alone.  You’ve got no time or interest in family, friends, the less fortunate, or the community – you’re too busy  getting the most power, the biggest pile of cash, and most exciting experiences for you.

Regrettably, GMC is tapping into something – America is shifting in their direction.  Whether it’s idolizing the Housewives of Wherever, the Kardashians, or the American Idol, we’re in the midst of deciding that life is really about acquiring wealth, status, and experiences. Social media, with its emphasis on clicks, followers, and likes is driving those trends.

We’re seeing the consequences of this profoundly wrong direction.  Despite the supposed connectedness brought by social media, loneliness has doubled since the 1980s (to 40 percent).  Depression rates have increased ten times since 1960, and suicide rates are at a 30-year high.  At work, there has been a 30-year decline in perceived quality of

Facebook Thumb

Maybe We Should Like This Less

relationships.  And, there is a significant and growing body of research linking heavy social media use with depression and anxiety (see here and here).  I’m not saying that all social media is bad (I’ll be using it to post this!), but if it becomes dominant in your life, you’ll be missing out.

We’re seeing the effects in politics as well.  I view the election of Donald Trump as a populist reaction of the American middle and lower class against the coastal elites’ decision that the traditional American life is no longer worth living or defending.  I seriously doubt that President Trump has the solutions to those problems, but his election may have been worth it if we’re seeing the beginning of a reaction against the forces that are tearing America away from its foundations.  If so, I hope that we can guide it in a positive direction – one that emphasizes the greatness of America and its lasting strengths – things like individual liberty (and community engagement), religious faith (and tolerance), political freedom (and civic virtue), and free market dynamism (with support and help for those displaced by its effects).

We’ll have to see about that.  In the meantime, our responsibility and opportunity is to live an honorable and meaningful life in the place where we are.  We need to live out our faith (if we have one), be a good and true husband or wife, do our best to be an involved parent, follow the rules, and find a way to help the community.  Critically, we should resist the urge to hide behind screens and entertain ourselves into loneliness; instead, we should unlock the richness of a life lived with and for others.  Be an engaged “servant” instead of trying to be a solo “boss,” and you’ll have a more fulfilling life.

Our Angry Politics is a Real Problem

America’s divisions have gotten deeper and more bitter.   Disagreements on issues like gun control, abortion, gender, immigration, and role of religion in public life are no longer just arguments about public policy.  Instead, Americans view them  as deep and unbridgeable cultural, religious, and philosophical divides.   We are a deeply divided nation — one “Red” and the other “Blue.”

The Rhetoric is Hot and Divisive

President Trump routinely spouts incendiary rhetoric.  He calls people names (he famously called Jeb Bush “low-energy,” Secretary Clinton “Crooked Hillary,” the President

President Trump

Often Angry

of North Korea “Rocket Man,” and his own Attorney General “Mr. Magoo”) and impugns people’s motives.  One of the President’s sons called the head of the Democratic Party a “whack job” and claimed that Democrats are so full of hate that they’re “not even people.”

The President’s critics are no better.  To them, President Trump doesn’t just propose immigration restrictions, he’s a “fascist” whose proposals are similar to forcing Jews to wear yellow stars.  He is, according to Vox Magazine, “unhinged,” “unstable,” “deluded” and suggests he be removed from office under the 25th Amendment as “mentally unfit.”  Even a Republican Senator (Jeff Flake), has compared him to Josef Stalin, the Russian communist leader who murdered millions of people.

A recent CNN town hall on gun control is a stark example of the trend.  The room was filled with people absolutely convinced that gun control is the solution to the mass shooter problem.  When anyone dared question their view, the crowed booed them.  One

CNN Rubio

Not the Shooter (CNN photo)

student compared Senator Rubio to the shooter, and the NRA rep. was accused of not supporting her own children.  The NRA was not outdone – it recorded a video soon thereafter stating that the “mainstream media love mass shootings.”

It’s Driving America Apart

It’s easy to dismiss this angry rhetoric as just talk.  And, maybe it is.  But I’m afraid all this vitriol and division is the beginning of a road that could lead to more serious conflict.  Perhaps even a revolution.  I’m sure you are dismissing this out of hand.  But consider a few data points.  In the last election, Bernie Sanders called for a “political revolution” in every campaign speech.  After he lost, he published a “Guide to Political Revolution.”

In the last two sessions, California legislators have introduced bills to secede from the United States; 44% of California Democrats support this idea.   Nearly 40% of Texans would have supported secession if Hilary Clinton had become president.   This trend has support across America.  A recent Zogby poll shows that 4 in 10 Americans believe that states should have the right to secede; among millenials, support is almost 50%.  At least the beginnings of revolutionary thinking are in the air.

Revolutions are Destructive 

Revolution

This is Going to End Badly

The history of revolutions is ugly.  Despite their apparent good intentions, revolutions almost always turn chaotic and violent after the initial rush of excitement (the American Revolution is an almost unparalleled exception).  Once chaos descends, people turn tocharismatic leaders who promise stability and order.  These leaders then use force and repression to consolidate their power.  As I described in my post on Communism, the revolutions in Russia, Cambodia, China and Vietnam turned stable, functioning societies into totalitarian police states which murdered millions.This not just history — we see the brutal consequences of revolution in present-day North Korea, Venezuala and the Democratic Republic of Congo.  In all of those countries, revolutionary leaders claimed the need to stay in power to enact their revolutionary agenda.  They acted with brutality to guarantee that ability.  Then, they shut down the free press, stifled religious liberty, prohibited free speech and oppressed minorities.

The end result is a shattered society that takes decades to recover, and many things are lost forever.  Informal community institutions are upended, religious life is destroyed, and worship of the state (and leader) is exalted.  The disabled, weak, and frail suffer the most as the young and strong must work hard just to stay alive.

Revolutions are usually a disaster, and we should do our best to avoid them.

Instead of Getting Angry, I’m Trying this Instead

How to do that?  In these times of deep ideological divide, I’m trying to do the following:

  • Get to know my opponent as a person — if I can do that, it’s hard for me to demonize them.
  • Assume positive intent — very few people set out to do evil.  I’m trying to see my neighbor’s argument in the best possible light.  That diminishes the possibility of me seeing them as less than human.
  • Be a little humble — I try to remember all the times I’ve been wrong (which is not hard!) and allow for possibility that it will happen again.
  • Argue against the idea, not the person — the surest way to escalate a situation is to attack the person directly — I’m trying to avoid the temptation.

In the end, America will be much better off if we tone down the rhetoric and be more civil.  America is well worth saving (I’ll address why in a future post) — it’s up to all of us to make sure that happens.

Protecting Children and Ending the Culture of Death

The focus and debate on the larger implications of Parkland has continued over the past week.  In my last post, I contended that spiritual renewal and providing real community to people would be the best ways to prevent future tragedies.  While I continue to believe this, I’d like to discuss some other causes and solutions to mass shootings in America.

The first relates to America’s culture.  As brilliantly argued by Peggy Noonan (read her whole article here) the 40-year rise in school shootings has coincided with a series of cultural shifts that have had the effect of harming children and cheapening human life.  The traditional family has blown up and far too many children grow up with only one parent.  Divorce has become

Children_following_teacher (1)

Our Culture has Harmed Them

commonplace; in many families, children suffer the consequences.  Movies and video games routinely glorify violence and death (often by mass shooting).  Helping people kill themselves (euphemistically called “assisted suicide”) is now allowed in six states.  And, the killing of our youngest and most helpless children through abortion continues without pause.  America even permits the gruesome practice of killing children after 20 weeks in the womb, a point where they are obviously, recognizably human and nearly capable of surviving on their own.  We are one of only seven nations to do so.

Through all of this, America has sent a message to children – they are disposable, and violence is acceptable.  To quote Ms. Noonan, the message is in the “air we breathe,” and provides the context where the Parkland shootings can take place.  We need to take action to reverse this message.

I would also like to more squarely address the question of gun control.  A good friend of mine passionately responded to my last article with a plea to ban the AR-15 and similar weapons.  I am skeptical that this would do much good.  The AR-15 is scary looking, and is apparently quite accurate and lethal, but it and many other similar rifles and pistols are commonly used by hunters, target shooters, and for family protection.  Given that there are over 300 million guns in America, I just don’t believe that it will make a significant difference to ban the AR-15 and its close cousins (we didn’t see much impact when it was banned between 1994 and 2004),

However, the AR-15 has become a favorite for mass shooters.  The shooters in Parkland, Aurora, and San Bernadino, to name just a few, all used variants of the AR-15.  At some point, I can understand why we might say “enough is enough.”

I would, therefore, support Ms. Noonan’s visionary “grand bargain.”  Let’s give our children (and the nation at large) a tangible counterweight to the culture of death and despair.  Let’s ban abortions (unless the mother’s life is at risk) after 20 weeks and the AR-15 in one piece of legislation.  In so doing, we would send a dramatic message to the children of America that they are valuable, life is precious, and that we can unify to achieve something.

Will this solve all our problems?  Nope.  Not even close.  There are other gun-related policies that we should consider.  David French, for example, has highlighted the promising idea to expand the concept of “gun violence restraining orders” which would provide judges with more tools to bar violent or mentally ill people from possessing weapons. President Trump and a bipartisan group of Senators have proposed enhanced background checks.   Legislators should soberly consider these proposals and others.  In so doing, they need to consider public safety, personal liberty, the efficacy of the measures, and the 2nd Amendment’s guarantee of the “right to bear arms,” a right our Founders thought was (and I think still is) an important guarantor of liberty.

In the end, I remain convinced that this crisis is mostly about people not having hope and meaning in their lives, and I would recommend that they seek Jesus Christ to find it.  And, we need to offer people, especially troubled people, a place in our hearts and lives.  This would have a much bigger impact than a “grand bargain” on abortion and the AR-15 or other policy proposals.  But, one is not the enemy of the other, and it would be worth trying all good ideas.

P.S. – I publish this on a night after one of my daughters was on lockdown at a public school for six hours due to a threatened shooting.  Thankfully, the police arrested the person allegedly behind the threats, and no one was hurt.  But, the scare brings home this issue to my family in a very real way – we desperately need a renewal in our culture to end the culture of death.

 

Image By Monika Wahi (Own work) [CC BY-SA 4.0 (https://creativecommons.org/licenses/by-sa/4.0)%5D, via Wikimedia Commons

There Really is a Way to Prevent Gun Violence

We are all heartbroken by the brutal shooting this week in Parkland, Florida.  17 precious souls lost.  The story is a depressingly familiar — a lonely, probably mentally ill young man obtains a semi-automatic weapon (in this case, like many others, an AR-15) and enters a school with the intent to kill as many kids as possible.

Almost immediately, the calls begin to “Do Something!”  People try to yell the loudest and assign blame the quickest.  But nothing ever changes.  Everyone knows why — let’s review why the old, tired arguments won’t solve the problem:

  • Let’s Ban all the Guns” — to many, this is the simple, obvious solution.  But, it just won’t work.  There are more than 300 million guns already in circulation — it would be practically impossible to round them all up.  Banning guns won’t stop someone bent on committing murder from obtaining them.  Even if you thought you could ban all guns, the 2nd Amendment to the Constitution would stop the government from doing so.  And, the American character is built on individual freedom — a massive gun confiscation policy just wouldn’t fly.
  • Let’s Ban the AR-15″ — This one seems good because the AR-15 is used in so many attacks.  But, despite what many think, the AR-15 is a fairly normal semi-automatic rifle, and shoots one bullet per trigger pull (as opposed to automatic rifles, which are illegal in most cases).  Semi-automatic rifles are commonly used by hunters, target shooters and home defenders.  If the AR-15 is banned, would-be mass shooters would have plenty of similar options to choose from.  If you want to ban all semi-automatic rifles, you’re right back to previous argument.
  • Let’s Arm the Teachers and/or Bring in Lots of Security” — This might do some good, but it won’t really slow or stop the committed psychopath intent on causing mayhem.  The Parkland High School had an armed guard onsite — the shooter just figured out how to avoid that one guard.  Unless we want to turn our schools into a war zone, which pretty much none of us want, this solution won’t solve the problem.
  • We Need More Mental Health Services” — I think this one is growing in popularity because it offers a truce in the gun wars.  And, while mental health counseling will help some people, what happens when there just aren’t warning signs?  What if the shooter isn’t mentally ill, but just evil?  Or, like in the Parkland case, what happens when the shooter’s stops going to mental health counseling?  And, who is going to bear the cost of all this care?  And, what about the many times when it just doesn’t work?  In the end, I just don’t trust that therapy is going to reach enough people or be effective enough to stop most mass killers.
  • Better Law Enforcement is the Answer” — Given the apparent bungling of the FBI in the Parkland case (it didn’t follow up on a direct warning), this one would have helped here.  But, that’s very rare.  Usually, the authorities have little or no warning before a mass shooting.  More often, the shooter stays under the radar until he executes his evil plan.

What will work?  I know this won’t be universally popular, but I think I know the solution — “the healing grace of Jesus Christ and a loving Christian community.”  I think some of you already stopped reading, but hear me out.

I think the root of mass shootings (like most evil in the world) stems from a deep void and pain at the center of the shooter’s life.  The profile of the mass shooter is almost always the same — he is estranged from family, has few friends, and retreats into hate-filled websites and social media.  He feels alone and hopeless.  What the would-be mass

Lonely_addict_manshooter needs is a real reason to hope and a real community to be a part of.

Faith in Christ and a Christian community is the answer to the deep yearning and pain of the shooter.  In Christ, the lonely young man can find answers to life’s questions and hope for a meaningful future on earth and after death.  He can find a purpose to live for.  In a Christian community, he can find people to share life’s joys and struggles.  In place of pain and futility, he can discover joy and meaning.

Will this work all the time?  Of course not.  But, if someone genuinely turns to Christ, and a Christian community steps up to support the person, they won’t commit mass murder.  How do I know?  Because I’ve experienced the joy and peace that comes from knowing Christ, and I have felt the satisfaction of real community.   Christians have a special burden here — they must reach out to and offer real community and support for the marginalized and troubled.  This isn’t easy (and I’m far from great at this), but it is an essential part of our Christian calling.

The hard part about this solution is that it takes away the shouting and blame.  There won’t be a simple solution you can vote for.  If you’re a Christian, it means you have to get out there and reach those who need to hear about Christ, and to offer love and community to everyone you can.  If you’re not a Christian, you know the old arguments and solutions won’t work — it might be worth a try.

*Picture by By https://kazan.vperemen.com/ (Own work) [CC BY-SA 4.0 (https://creativecommons.org/licenses/by-sa/4.0)%5D, via Wikimedia Commons

On Spending, America is a Spoiled Brat

America is the wealthiest nation in the history of the world.  Our annual Gross Domestic Product is nearly $20 trillion, nearly double the second place nation (China) and more than the Japan, U.K., Germany, India and France combined.   Not surprisingly, the U.S. government spends nearly twice as much as any government on its people and priorities.

With all this wealth, you would think it should be no problem for the U.S. to balance its budgets.  Think again.  America is nearly $20 trillion in debt, which is more than our entire economic output for a year.  This week, Congress added around $500 billion in new spending, and passed a $1.5 trillion ten-year tax cut last month.  These actions pushed next year’s projected deficit to almost $1 trillion.

What the heck is going on?  Why, despite our massive wealth, are we piling on debt after debt after debt?  And, what is the risk of doing so?  The answers are depressingly clear.

Like Veruca Salt, America “Wants it Now”

In Willy Wonka and the Chocolate Factory, a group of lucky children win tickets to tour the amazing chocolate factory.  One of the lucky kids is Veruca Salt.  She is the daughter of rich parents who give her whatever she wants.  Veruca is never satisfied, and whines at the smallest deprivation.  She makes her father buy thousands of Wonka Bars to guarantee that she gets a coveted golden ticket to the factory.  She gets in.  But, when Veruca 3Willy Wonka won’t sell a golden goose to her father, Veruca whines, stomps, and complains.  She wants the goose “now.”  She’s so obnoxious that Wonka ejects her from the plant.

America’s politicians (and we Americans) are so like Veruca.  We have unparalleled financial resources, and can afford anything we want if we are willing to wait for a short time.  But, like Veruca, we can’t wait — we have to have it right now.  We aren’t willing to only fund our greatest priorities — instead, we pretend like there are no trade-offs to be made.  So, we borrow money from countries (like China, Japan and tiny Belgium) that are much smaller than we are.  Like Veruca, our childish whining is obnoxious and has real effects.

We Don’t Understand the Consequences of “One More Wafer Thin Mint”

In Monty Python’s Meaning of Life, there is an unforgettable scene involving a grotesquely obese man who just can’t stop eating.  After finishing every item on the menu and drinking obscene quantities of alcohol, he finally pronounces himself done.  The Maîtrie d’ approaches the man and offers him “just one more wafer thin mint.”  The man accepts the mint, eats it, and proceeds to explode.

I’m afraid America is perilously close to suffering the obese man’s fate.  We have piled on significant debt for two generations, and we haven’t yet seen the negative consequences of that debt.  Additional government spending has allowed us to fund it all —  Social Security and defense, Medicare and roads, tax cuts and energy subsides . . . the list goes on.  We’ve spent on all the items on the liberal and conservative wish list, and cut taxes for both the rich and poor.

Wafer Thin

“One more wafer thin mint”

We’ve gotten away with this for many reasons.  First, America has the world’s largest and most productive private sector, and that has provided room for politicians to raise spending.  America’s growth and productivity also makes it an attractive place for foreign investors — this investment soaks up America’s debt.  Additionally, the American dollar is the world’s dominant currency, which means that there is a constant demand for dollars across the globe.  So long as investors continue to hold dollars as their safe haven, the U.S. can get away with these large deficits.

 

 

But, like every other dominant economy in the history of the world, America’s time at the top will end.  Eventually, we will eat one too many mints, and the consequences will be swift. History has shown that the investors turn quickly and unexpectedly against their debtors.  Greece and Argentina are suffering the consequences of their over-indulgence – years of austerity, slow growth and social unrest.  One day, America’s “wafer thin mint” moment will arrive — and the explosion will be catastrophic.

“The Borrower is Slave to the Lender”

America’s political class shrugs at this accumulation of debt — as Vice President Dick Cheney famously said, “no one cares about deficits.”  But there is an iron reality in relationship between the those who lend and those who borrow.  It is found in Proverbs 22:7, in which the Lord states plainly:  “the borrower is slave to the lender.”  This is very plain in the personal realm — in order to get a house loan, I must mortgage my house and pledge my good name.  If I fail to pay the debt, then I will lose the house, ruin my credit, and might even have my wages garnished to pay back any excess amount.

On the national level, it’s a bit more complicated, but the dynamic is ultimately the same.  America’s national debt is funded by issuing bonds.  45% of that debt is held by foreign countries, with both China and Japan each owning more than $1 trillion of America’s debt.  When we seek to exert economic and foreign policy leverage over those nations, our debt situation limits our influence and power.  The size and power of America currently limits the damaging effect of our debts, but the costs are real, corrosive and will increase over time.  When our creditors lose confidence in America’s ability to grow and ultimately repay the debt, we will feel the sting.

Whistling in the Wind

Sadly, this post seems irrelevant.  Neither the people nor their politicians have any interest in the Unites States living within its means.  Most are content to be Veruca or the obese man.   The consequences of continuing on this course are real and severe.  I hope that we change our view before others change it for us.

 

 

 

Against President Trump’s Tariffs

Free trade is under attack around the globe.  Opponents deny the benefits and blame free trade for job losses, shuttered plants, and a loss of domestic manufacturing.  President Donald Trump is the leader of this movement — he built his campaign on the proposition that free trade has harmed America, particularly the middle class.

Free Trade Is Good For America

I disagree, and I argued in my last post that free markets and free trade are good for America (and the world).  Trade increases prosperity because it allows people and nations to concentrate on doing a few things particularly well and then offer the fruits of their efficient innovation to the world at large.  Free trade and free markets have created wealth at an unprecedented rate and lifted millions out of poverty.  Unfortunately, the benefits of trade are dispersed across the economy, while the costs of foreign competition are often felt by individual industries and companies.  Overall, I believe that the benefits far outweigh the costs.

President Trump Disagrees

President Trump argues, to the contrary, that “we’ve made other countries rich while the wealth, strength, and confidence of our country has disappeared over the horizon.”  He claims that “one by one, the factories shuttered and left our shores, with not even a thought about the millions upon millions of American workers left behind.”  And, he believes that “the wealth of our middle class has been ripped from their homes and then redistributed across the entire world.”  In his Inaugural Address, he promised “now arrives the hour of action.”

Last week, he made good on part of that pledge by imposing tariffs on the washing machine and solar panel industries.  The news reports focus largely on the politics of the move, but a review of exactly what the Administration claims as justification reveals just what a bad idea this is.  In the interest of space, I’m only going to focus on the washing machine tariff.

The Washing Machine Tariff

The Trump Administration imposed the following tariffs on all large residential washing machines imported into the United States:

Washing Machine

Whirlpool called the decision “a victory for American workers and consumers alike.”  and announced that it was adding 200 jobs in one of its plants.

These tariffs are a tax on imported washers.  The 50% increase in price makes an already expensive appliance (a mid-priced version retails for over $600 at Best Buy) even more costly.  Even if companies absorb some of the increased expenses, consumers can, according to the Peterson Institute, expect to see their prices go up Washeraround $100.  That’s a significant price increase for families that need a new washer.

The South Korean government, an important U.S. ally in Asia, was predictably upset by the decision.  They called the case “protectionist” and “unfair” and promised to take the issue to the World Trade Organization (where the U.S. has lost similar cases in the past).

The Trump Administration is willing to accept these costs because it hopes to revitalize the domestic dishwasher industry, most notably Whirlpool.  Whirlpool has been losing market share in the United States to LG and Samsung, which are Korean companies that generally make their products outside of the United States (ironically, Samsung is building a new plant in Tennessee that will provide Americans 600 jobs).  The reason for this loss, according to the Administration and Whirlpool, was due to “an aggressive downward pricing strategy” (also known as “dumping”) pursued by LG and Samsung in the washer market.  Originally, Whirlpool had charged that the South Korean government had subsidized LG and Samsung, but no proof was found to support the allegation.

“Dumping” is an intentionally loaded term for a simple market reality — LG and Samsung have cut their lowered their prices too far for Whirlpool to compete effectively against them.   LG and Samsung’s critics claim that they are pricing below their actual cost and that they have done so for many years.   This defies logic.  LG and Samsung are in the

Whirlpool

Whirlpool’s Ohio Plant

business to make profits.  A company would only lower prices below its actual costs (and therefore lose money) if thought it could subsequently raise prices over a sustained period of time to recoup those losses.  Given that the washing machine industry has sales in excess of $20 billion and at least 16 manufacturers, the ability of LG and Samsung to charge excessively high prices for a period of time long enough to make up for its losses over any reasonable period is essentially zero.

In the end, the allegation of “dumping,” and the imposition of tariffs, is simply a cover for a protectionist impulse to help Whirlpool and a small number of workers.  The cost for this protection is high.  Americans will pay more to wash their clothes and we’ve hurt our relations with a key ally.  The tariffs are also a blow to the global trade system, which provides lower tariffs and economic growth for all people.

Where we go from here

American industries are lining up to take advantage of the Trump Administration’s willingness to impose tariffs.  The steel industry is especially eager to gain an advantage over their foreign competitors.  I hope that there are enough complaints by consumers and industry in the washer and solar panel markets to cause the Administration to back away from its harmful protectionist path.

In Defense of the Free Market (and Help for Those it Hurts)

President Donald Trump’s decision to impose tariffs on solar panels and washing machines made abroad got me thinking about the free market, capitalism, and free trade.  Over the next two posts, I’ll explore the economic and moral case for the free market, consider its destructive effects, and examine President Trump’s tariff plan.

Free Markets Are a Good Thing

Let’s start with a basic premise — the Shire supports free markets and capitalism.  The market allows free people to use their skills and ingenuity to sell products and services that other free people are willing to pay for.  The profit generated by those sales enables people to live and purchase those things their families need to survive.  Allowing people to exchange goods and services is an important freedom.

A market-driven system also ensures that there will be an abundance of the goods and services that people need.  A simple illustration makes the point.  If, for example, people want to buy more hammers than are available at the local store, the shop-owner will raise his prices.  This will have two important Hammereffects.  First, it will spur manufacturers to make more hammers, because the shop-owner will be willing and able to pay more for the hammers due to the higher prices that she is able to charge.  Second, the high prices will ensure that hammers go to those who need hammers the most — they will pay the most for them.

When countries allow the free market to operate across borders, free trade is beneficial to both countries.  Three ideologically distinct administrations — the Bush,  Obama, and even the Trump Administration (at least according to his Trade Representative website)  unanimously agree that trade is good for America.  A few (of many) facts bear this out:

Bottom line — free trade between countries is good for American business, workers and consumers.

Beyond the economic benefits of free markets, Michael Novak argues brilliantly in The Spirit of Democratic Capitalism (a Shire Favorite Book) for the moral case.   He contends that capitalism fosters “an ethos of association, teamwork, and collaboration, oriented towards goals, voluntarily entered into.”  Furthermore, he notes that the capitalist system causes people to meet and trade with folks outside of their immediate circle.  Not only do people meet the outsider, they learn to “build decent and even affective relations” with their business colleagues.  This is necessary because, without a level of trust and communication, a free exchange of products cannot occur.  A free market system, therefore, has the effect of creating the social goods of cooperation and peacefulness.

 

But, Markets Cause Destruction

However, as the economist Joseph Schumpeter pointed out, the free market economy is an agent of “creative destruction.”   When one firm prospers through innovation or

Joseph_Schumpeter_ekonomialaria

Joseph Schumpeter

efficiency, another loses sales.  While those outside the business world jealously eye the profits made by the winners, they miss the hardship felt by the losers.  Business failures, plant closures, restructures and layoffs are routine and painful aspects of the market economy.  This is not just an unfortunate side effect of capitalism — it is at the very core of how it works.

 

 

Society’s Obligation

What should society do?  We want the benefits of efficiency, innovation, abundance, and peaceful co-existence that a market economy offers.  But we also want people who follow the rules and work hard to have a level of certainty and security.  This is not altruism – if people believe they are a small step away from chaos and disruption (perhaps through no fault of their own), they will not support the market economy regardless of the benefits it offers to society.  Worse yet, displaced people may commit crimes to survive or retaliate against those who are successful.

The right balance is to let the effects of the market (including trade between nations) play out with minimal government interference.  That way, society and consumers get the benefits of more, ever-improving goods at lower prices.  But, the government should help people who are hurt by the destructive effects of the market.  Safety net programs like Unemployment benefits, Medicaid, food stamps, and job retraining programs can help people who get hurt by the rigors of capitalism.   Additionally, churches, non-profits and community organizations should step in to help families and individuals who need help after the devastation of a job loss.  A good society provides assistance to people when they need it.

In my next post, we’ll focus specifically on trade and examine President Trump’s decision to place tariffs on imported washing machines and solar panels.  Spoiler alert — I think he’s landed in the wrong place.

Why Contemporary Art is so Awful

We live in a coarse age.  In many ways, big and small, the graces of life are being undermined and diminished.  A prime example is the world of art where lovely and inspiring canvases have been replaced with . . . we’ll get to that soon.  Let’s start with a disclaimer — I am not an art expert.  I took the Art History survey in college and enjoy the occasional Sunday afternoon at the museum, but I have no special training in art.  However, that’s never stopped me from having an opinion before – so, here goes!

It seems to me that art exists to express beauty and help us find truth.  Beauty exalts the human spirit, shows us things beyond our small life, gives our soul rest from difficulties, and brings us closer to God.  Truth is necessary because it is real, substantial, and just.  When truth and beauty are united in a work of art, especially if they point to the eternal, we are ennobled and satisfied.

There are many examples of art that embody the idea of beauty and truth.  A few that come to mind are Wren’s St. Paul’s Cathedral,  Renoir’s On the Terrace, and da Vinci’s The Last Supper.

St. Paul's

St. Paul’s Cathedral, Christoper Wren (1711)

Pierre-Auguste_Renoir_007
On the Terrace, Pierre-Augoste Renoir (1881)
last-supper-leonardo-da-vinci

The Last Supper, Leonardo da Vinci (1498)

 

 

 

 

 

 

These pieces have much in common despite their disparate subject matter, media, and time of creation.  First, in all three, the detail is rich and the use of color and shadow is both complex and pleasing to the eye.  There is also notable symmetry and balance in all of the works.  The themes are deep and meaningful — the last supper of Christ, mother and child, and an inspiring place of worship.  Most simply (and profoundly), they are a joy to look at.  I’ve had the privilege to view two of these works in person, and it is a transcendent experience.

Contrast the harmony, beauty and meaning of these works with some examples from today’s art scene (known as “Contemporary Art”) — each of these are from artsy.net’s “Ten Artworks Tell the Story of Contemporary Art” list:

Artist

The Artist is Present, Maria Abrama (2010)

Huffy Howler

Huffy Howler, Rachel Harrison (2004)

mP

Rhein II, Andreas Gursky (1999)

The best thing I can say about these works is that they are somewhat playful and whimsical.  Other than that, it is hard to find meaning or value.  The Artist is Present and Rhein II seem intentionally designed to strip away any notion of significance.  They certainly invite the viewer in — however, the invitation is to nothingness.  Huffy Howler defies all attempts to divine a message — it appears to be a collection of junk thrown together at the last minute.  According to the artsy.com review, that actually is the point.  Apparently, the artist was looking to contrast the modesty of her work against larger scale “monumental” projects.  I guess she succeeded at that, but not much else.

As for values like symmetry, beauty, coherence and eternal significance, the Contemporary Art pieces have little to recommend them.  They do not seek to elevate or inspire.  At best, they are social commentaries on the world around them.  In order to understand what those commentaries are, one has to research the back story.   For example, it turns out that the Rhein II artist digitally removed all things from the scene except for the river itself.  He explains: “Paradoxically, this view of the Rhine cannot be obtained in situ, a fictitious construction was required to provide Bucking-ArtworldV4-4an accurate image of a modern river.”  This is interesting as an intellectual matter, but does not add value to the work of art as a visual or sensory experience.

In the end, Contemporary Art is an expression of the boredom and lack of meaning that pervades modern life.  Western civilization, especially in the high culture realm, is both exhausted and has lost its nerve.  Thankfully, the cultural heritage left by our forbears is still available to us.  We can still view the works I reference above, read Jane Austen, listen to a concerto by Bach, or see a play by Shakespeare.  Also, if you would like to read an academic treatment by an author who largely shares my view of the failings of Contemporary Art, but does so in a much more rich and thoughtful way, check out Michele Marder Kamhi’s Reflections on Art, Pseudo Art, Art Education & Theory.

Over the next few weeks, I challenge you to step outside of our mean and vulgar art landscape.  Instead, take in some of the world’s great culture.  It will please your eye, raise your spirits, and take you to a different and better place.

Martin Luther King Jr., American Hero

Today, America pauses to celebrate the life and legacy of Martin Luther King Jr.   Dr. King’s impact on America cannot be overstated.  He led a movement that awakened America to the injustice and cruelty of the overt racism that dominated America, particularly in the South.  He did so by calling America back to its roots and ideals, both secular and biblical.  This post will center on Dr. King’s prophetic and majestic Letter from a Birmingham Jail.  If you have the time, I would strongly encourage you to read the entire letter here.

The Birmingham Protest

In early 1963, Dr. King was at a low point.  Recent setbacks in Georgia had stalled the civil rights movement; Dr. King and his Southern Christian Leadership Conference needed something dramatic to spur momentum.  They chose Birmingham, Alabama as the place to make a stand.  Dr. King called it “the most thoroughly segregated

King Photo

Dr. King promoting a book based on his Letter from a Birmingham Jail

city” in America.  Blacks were forbidden to eat and play at “white only” locations, the KKK was active and violent, and outright segregationists dominated city government.

Dr. King countered hate with aggressive love and non-violence.  He and his followers confronted the power structures with boycotts of segregated businesses, marched on power centers, and created peaceful but direct encounters with the police.  Seeking to shut the movement down, “Bull” Connor, the city’s Commissioner of Public Safety and noted segregationist, got an injunction against future marches. Despite this, Dr. King and his followers pressed on.  At the next protest, Dr. King was jailed.

 

The Letter from a Birmingham Jail

While in jail, Dr. King penned his famous Letter, which is styled as a response to eight white clergyman who criticized the protests (see their letter here).  Dr. King’s answer was a brilliant and prophetic defense of the civil rights movement from a moral, spiritual, practical, philosophical, and political perspective. I’ll comment on some of the most notable points:

The Need for Pressure

Nonviolent direct action seeks to create such a crisis and foster such a tension that a community which has constantly refused to negotiate is forced to confront the issue . . . My friends, I must say to you that we have not made a single gain in civil rights without determined legal and nonviolent pressure. Lamentably, it is an historical fact that privileged groups seldom give up their privileges voluntarily.

Dr. King clearly understood the sad truth that oppressors seeking to protect their position will not concede without a struggle.  The brilliance of Dr. King’s movement was that they created that tension through non-violent means.  In so doing, they gained moral authority in the eyes of the United States and the world.

Waiting for Justice

For years now I have heard the word “Wait!” It rings in the ear of every Negro with piercing familiarity. This “Wait” has almost always meant “Never.” . . . We have waited for more than 340 years for our constitutional and God given rights. . . Perhaps it is easy for those who have never felt the stinging darts of segregation to say, “Wait.” But when you have seen vicious mobs lynch your mothers and fathers at will and drown your sisters and brothers at whim; when you have seen hate filled policemen curse, kick and even kill your black brothers and sisters. . . when you are harried by day and haunted by night by the fact that you are a Negro, living constantly at tiptoe stance, never quite knowing what to expect next, and are plagued with inner fears and outer resentments; when you are forever fighting a degenerating sense of “nobodiness”–then you will understand why we find it difficult to wait.

This passage sears the soul.  For someone like me, who has never felt the sting of segregation, not to mention a fear of lynch mobs, it is nearly impossible to understand MLK -- March on Washingtonwhat Dr. King and his followers were up against.  Especially given the three centuries since slavery began, and the fact that the Civil had ended a century before, a request to “wait” must have been an outrage.  Action was not only justified, it was demanded.  Dr. King and his followers courageously met the call of their time.

 

Just vs. Unjust Laws (A Defense of Natural Law)

You express a great deal of anxiety over our willingness to break laws. This is certainly a legitimate concern. Since we so diligently urge people to obey the Supreme Court’s decision of 1954 outlawing segregation in the public schools, at first glance it may seem rather paradoxical for us consciously to break laws. One may well ask: “How can you advocate breaking some laws and obeying others?” The answer lies in the fact that there are two types of laws: just and unjust. I would be the first to advocate obeying just laws. One has not only a legal but a moral responsibility to obey just laws. Conversely, one has a moral responsibility to disobey unjust laws. . .

Now, what is the difference between the two? How does one determine whether a law is just or unjust? A just law is a man made code that squares with the moral law or the law of God. An unjust law is a code that is out of harmony with the moral law. . . We should never forget that everything Adolf Hitler did in Germany was “legal” and everything the Hungarian freedom fighters did in Hungary was “illegal.”

The question of “natural law” is a thorny one.  A society can only exist if most laws are followed by the citizenry most of the time.  However, as the Founders of America recognized, people have certain “inalienable rights,” and that no nation has the right to violate those rights, even if a majority of people pass a law that does so.  If a nation passes an unjust or immoral law, Dr. King correctly argues that a just person must disobey that law.  While it is difficult to correctly determine when a law is sufficiently unjust to justify disobedience, the Jim Crow segregation laws were clearly unjust and contrary to both the “moral law” and “God’s law.”  Dr. King and his followers were right to disobey those laws and advocate for their repeal.

When Moderation Fails

First, I must confess that over the past few years I have been gravely disappointed with the white moderate. . .  who is more devoted to “order” than to justice . . . Shallow understanding from people of good will is more frustrating than absolute misunderstanding from people of ill will. Lukewarm acceptance is much more bewildering than outright rejection. . . I had hoped that the white moderate would understand that law and order exist for the purpose of establishing justice . . .

And now this [nonviolent] approach is being termed extremist. But though I was initially disappointed at being categorized as an extremist, as I continued to think about the matter I gradually gained a measure of satisfaction from the label. Was not Jesus an extremist for love: “Love your enemies, bless them that curse you, do good to them that hate you, and pray for them which despitefully use you, and persecute you.” Was not Amos an extremist for justice: “Let justice roll down like waters and righteousness like an ever flowing stream.” . . . And Abraham Lincoln: “This nation cannot survive half slave and half free.”  And Thomas Jefferson: “We hold these truths to be self evident, that all men are created equal . . .” So the question is not whether we will be extremists, but what kind of extremists we will be. Will we be extremists for hate or for love?

This argument cuts to the very core of this blog, in which I advocate for moderation, incrementalism, and respect for tradition.  And, while I believe that these ideas are right most of the time, Dr. King correctly argues that some situations call for extreme action.  But, without constraints, this idea could lead to an unknown number of harmful radical changes.  Happily, Dr. King provides a guide — he reaches back to the secular and spiritual heritage of America as a way to hem in those who would seek to expand his idea too far.  He cites to Jefferson, Lincoln, the prophet Amos and even the Lord Jesus Christ as exemplars.  These righteous and heroic examples are a double edged

LBJ and King at 1964 Civil Rights Act Signing

Fruit of His Labor:  Dr. King watches President Johnson sign the Civil Rights Act

sword — they bring moral authority, but also hold your cause to the highest standard.  To gain the right to take extreme action, your cause must be just enough to satisfy the scrutiny of Jefferson, Lincoln, Amos, and Jesus Christ.  This is a high standard, indeed.  Dr. King’s movement met that standard, but few others will — a protection against radicalism.

 

How History Will Judge The Civil Rights Movement

I have no fear about the outcome of our struggle in Birmingham, even if our motives are at present misunderstood. We will reach the goal of freedom in Birmingham and all over the nation, because the goal of America is freedom. Abused and scorned though we may be, our destiny is tied up with America’s destiny. Before the pilgrims landed at Plymouth, we were here. Before the pen of Jefferson etched the majestic words of the Declaration of Independence across the pages of history, we were here. For more than two centuries our forebears labored in this country without wages; they made cotton king; they built the homes of their masters while suffering gross injustice and shameful humiliation -and yet out of a bottomless vitality they continued to thrive and develop. If the inexpressible cruelties of slavery could not stop us, the opposition we now face will surely fail. We will win our freedom because the sacred heritage of our nation and the eternal will of God are embodied in our echoing demands.

This passage resonates strongly with me, because Dr. King is expressly reaching back to America’s founding ideals against the reality of segregation.  He brilliantly juxtaposes the “majestic” words of “freedom” and “independence” with the “injustice,” “humiliation” and “cruelties” of slavery.  He knows that America’s founding ideals are the place to look even when the country falls short of honoring them.  In fact, it is the very fact of those ideals that creates the springboard for reformation.  Dr. King’s genius was to create circumstances where the contrast between our ideals and the reality became intensely visible to Americans.  When that dissonance was made clear, reform could (and did) follow.

In closing, Dr. King prophetically wrote:

One day the South will recognize its real heroes. They will be the James Merediths, with the noble sense of purpose that enables them to face jeering and hostile mobs, and with the agonizing loneliness that characterizes the life of the pioneer. They will be old, oppressed, battered Negro women, symbolized in a seventy two year old woman in Montgomery, Alabama, who rose up with a sense of dignity and with her people decided not to ride segregated buses, and who responded with ungrammatical profundity to one who inquired about her weariness: “My feets is tired, but my soul is at rest.” . . .

One day the South will know that when these disinherited children of God sat down at lunch counters, they were in reality standing up for what is best in the American dream and for the most sacred values in our Judaeo Christian heritage, thereby bringing our nation back to those great wells of democracy which were dug deep by the founding fathers in their formulation of the Constitution and the Declaration of Independence.

As he foretold, we do honor and celebrate the heroes of the civil rights movement.  We remember and tell the stories of James Meredith, Rosa Parks, John Lewis, Ralph Abernathy, and so many others.  We in fact acknowledge that they were standing up for America’s “most sacred values” and embodied the American Dream.  And, most of all, we recall the brilliance and moral courage of Dr. Martin Luther King, Jr.  While we aren’t perfect yet, America is a better place because of his life and actions.

 

%d bloggers like this: