Posts Tagged 'Fox News'

OMG! The Age of Trump Is upon Us

UPDATE (11/11, 10:47 am EST): Clinton’s lead in the popular vote is now about 400,000 and according to David Leonhardt of the New York Times, the lead is likely to increase to as much as 2 million votes by the time all the votes are counted.

Here’s a little thought experiment for you to ponder. Suppose that the outcome of yesterday’s election had been reversed and Hillary Clinton emerged with 270+ electoral votes but trailed Donald Trump by 200,000 popular votes. What would the world be like today? What would we be hearing from Trump and his entourage about the outcome of the election? I daresay we would be hearing about “second amendment remedies” from many of the Trumpsters. I wonder how that would have played out.

(As I write this, I am hearing news reports about rowdy demonstrations in a number of locations against Trump’s election. Insofar as these demonstrations become violent, they are certainly deplorable, but nothing we have heard from Clinton and her campaign or from leaders of the Democratic Party would provide any encouragement for violent protests against the outcome of a free election.)

But enough of fantasies about an alternative universe; in the one that we happen to inhabit, the one in which Donald Trump is going to be sworn in as President of the United States in about ten weeks, we are faced with this stark reality. The American voters, in their wisdom, have elected a mountebank (OED: “A false pretender to skill or knowledge, a charlatan: a person incurring contempt or ridicule through efforts to acquire something, esp. social distinction or glamour.”), a narcissistic sociopath, as their chief executive and head of state. The success of Trump’s demagogic campaign – a campaign repackaging the repugnant themes of such successful 20th century American demagogues as Huey Long, Father Coughlin and George Wallace (not to mention not so successful ones like the deplorable Pat Buchanan) — is now being celebrated by Trump apologists and Banana Republican sycophants as evidence of his political genius in sensing and tapping into the anger and frustrations of the forgotten white working class, as if the anger and frustration of the white working class has not been the trump card that every two-bit demagogue and would-be despot of the last 150 has tried to play. Some genius.

I recently overheard a conversation between a close friend of mine who is a Trump supporter and a non-Trump supporter. My friend is white, but is not one of the poorly educated of whom Trump is so fond, holding a Ph.D. in physics, and being well read and knowledgeable about many subjects. Although he doesn’t like Trump, he is very conservative and can’t stand Clinton, so he decided to vote for Trump without any apparent internal struggle or second thoughts. One of his reasons for favoring Trump is his opposition to Obamacare, which he blames for the very large increase in premiums he has to pay for the medical insurance he gets through his employer. When it was pointed out to him that it is unlikely that the increase in his insurance premiums was caused by Obamacare, his response was that Obamacare has added to the regulations that insurance companies must comply with, so that the cost of those regulations is ultimately borne by those buying insurance, which means that his insurance premiums must have gone up because of Obamacare.

Since I wasn’t part of the conversation, I didn’t interrupt to point out that the standard arguments about the costs of regulation being ultimately borne by consumers of the regulated product don’t necessarily apply to markets like health care in which customers don’t have good information about whether suppliers are providing them with the services that they need or are instead providing unnecessary services to enrich themselves. In such markets, third-parties (i.e., insurance companies) supposedly better informed than patients about whether the services provided to patients by their doctors are really serving the patients’ interests, and are really worth the cost of providing those services, can help protect the interests of patients. Of course, the interests of insurance companies aren’t necessarily aligned very well with the interests of their policyholders either, because insurance companies may prefer not to pay for treatments that it would be in the interests of patients to receive.

So in health markets there are doctors treating ill-informed patients whose bills are being paid by insurance companies that try to monitor doctors to make sure that doctors do not provide unnecessary services and treatments to patients. But since the interests of insurance companies may be not to pay doctors to provide services that would be beneficial to patients, who is going to protect policyholders from the insurance companies? Well, um, maybe the government should be involved. Yes, but how do we know if the government is doing a good job or bad job of looking out for the interests of patients? I don’t think that we know the answer to that question. But Obamacare, aside from making medical insurance more widely available to people who need it, is an attempt to try to make insurance companies more responsive to the interests of their policyholders. Perhaps not the smartest attempt, by any means, but given the system of health care delivery that has evolved in the United States over the past three quarters of a century, it is not obviously a step in the wrong direction.

But even if Obamacare is not working well, and I have no well thought out opinion about whether it is or isn’t, the kind of simple-minded critique that my friend was making seemed to me to be genuinely cringe-worthy. Here is a Ph.D. in physics making an argument that sounded as if it were coming straight out of the mouth of Sean Hannity. OMG! The dumbing down of America is being expertly engineered by Fox News, and, boy, are they succeeding. Geniuses, that’s what they are. Geniuses!

When I took my first economics course almost a half century ago and read the greatest economics textbook ever written, University Economics by Armen Alchian and William Allen, I was blown away by their ability to show how much sloppy and muddled thinking there was about how markets work and how controls that prevent prices from allocating resources don’t eliminate destructive or wasteful competition, but rather shift competition from relatively cheap modes like offering to pay a higher price or to accept a lower price to relatively costly forms like waiting in line or lobbying a regulator to gain access to a politically determined allocation system.

I have been a fan of free markets ever since. I oppose government intervention in the economy as a default position. But the lazy thinking that once led people to assume that government regulation is the cure for all problems now leads people to assume that government regulation is the cause of all problems. What a difference half a century makes.

About Me

David Glasner
Washington, DC

I am an economist in the Washington DC area. My research and writing has been mostly on monetary economics and policy and the history of economics. In my book Free Banking and Monetary Reform, I argued for a non-Monetarist non-Keynesian approach to monetary policy, based on a theory of a competitive supply of money. Over the years, I have become increasingly impressed by the similarities between my approach and that of R. G. Hawtrey and hope to bring Hawtrey’s unduly neglected contributions to the attention of a wider audience.

My new book Studies in the History of Monetary Theory: Controversies and Clarifications has been published by Palgrave Macmillan

Follow me on Twitter @david_glasner


Enter your email address to follow this blog and receive notifications of new posts by email.

Join 3,244 other subscribers
Follow Uneasy Money on