End of the year observations

Prosperity for Rhode Island
By Greg Gerritt
December 27, 2018

It would be very easy to be depressed about the state of the world as we move from 2018 to 2019 with racism, authoritarianism, growing inequality, an increase in refugees from war and climate change, rising carbon emissions, ever faster deforestation, empty seas, loss of biodiversity, more nuclear weapons in the pipeline, the trampling of communities in pursuit of profit, democracy in retreat, and the hottest La Nina year in history, but it has to be balanced with the UN laughing at Trump, a repudiation in the mid term elections, the growing resistance to fossil fuels everywhere, a reawakening in agriculture, growing movements to clean up the various aspects of the waste stream including plastics and organics, and the amazing growth of windpower along the east coast of the US. The elites are doing a lousy job, but the people are doing amazing things in every community on the planet. Let’s start with a look at some elite stupidity.

A typical American headline

President Toxic Dump decides to pull all American troops out of Syria. As a long time advocate for the complete withdrawal of American troops from conflicts that we are creating around the world, one might think I would celebrate. But when you dig deeper you find the president of Turkey talked him into it so he could safely attack the Kurds. It is an action by the US without planning, notice to allies, or any thoughts as to what will happen next. Just Trump being conned and played. And only thinking about how it effects him and his campaign lies, Like so many of Trump’s actions it has one tiny sliver of something good, done for all the wrong reasons and in the most ridiculous and dangerous way possible.

Maybe Trump really does want to start bringing American troops home and putting an end to wars. I doubt it, but stranger things have happened in the US, and he has been talking about how badly those wars have been going for all these years. If Trump wants to save money and downsize the military, then an abrupt withdrawal from Syria and Afghanistan is not the best way to start. The smart thing to do is start closing the more than 800 overseas bases, beginning with those no where near conflict zones, followed by well thought out withdrawal from conflict zones and an end to the drone strikes, though doing it in orderly fashion might be beyond his capabilities. We have no good reason to have military bases anywhere in the world. The world is a more dangerous place when the US, or any country, tries to keep an empire or be the world’s policeman.

Another headline

Putin Says US has made world more dangerous by pulling out of nuclear treaties. Putin is a complete thug. But he is also right. Pulling out of treaties like those reducing nuclear weapons is truly insane. But Trump wants to build more nuclear weapons. (So did Obama, Bush, Clinton, and Bush, so it is nothing new for American Presidents) We have to be careful about how we deal with large and powerful countries. But peace, actual peace based on justice and nonviolence actually works to everyone’s advantage, except maybe the thugs and the arms manufacturers. Selling to refugees is not really profitable most of the time, but a riled up world always wants more guns. And refugees and guns are what we seem to get when we have unhinged autocrats in charge working to protect the perks of the rich.

Yet despite Trump’s psychotic and bizarre approach to foreign affairs (pulling out of every treaty he did not originate) and issues of world peace (peace is not a profitable path for Senator Inhofe’s investments in Raytheon) he is much more likely to lead to the burning of the planet through his alignment with fossil fuel and climate denying powered autocrats like the Saudis, Putin, and the new wack job in Brazil who is ready to make war on the forest people of the Amazon in the pursuit of more soybeans for China and McDonalds. It is rather strange that Trump mostly wants to align with autocrats rather than the people who actually believe in democracy, justice, freedom and the right of communities to self determination. Or rather I wish it was strange that an American president was more comfortable and friendly with thugs than with countries that actually practice democracy.

The obsession with Iran is incredibly numb, but it is not just Trump,. It is a whole clique in the US. People who hate that Iran threw off a dictator imposed by the Americans and captured the embassy as statement of disgust with American meddling. In the name of democracy the US overthrew elected leaders to put in a Shah. If someone did that to us, we would be pretty mad. But what drives the stupidity even more is that the Saudis hate the Iranians because of the old story of Shia versus Sunni dating back to relatives of Mohammed as well as a more modern rivalry. Our allies, the Saudis, support and export a radical brand of Sunni Islam that has been responsible for many wars, deaths, and refugees, including the attack on the World Trade Center on 9/11/01 We pick our friends badly, then compound our errors and arm the folks turning the weapons on us. To make it even wackier, most of what Trump has proposes to do in the Middle East will benefit Iran. Iran is clearly a place in which if we left them alone to forge their own way in the world, they would move towards peace and openness. The Mullahs will not hold on forever in face of the youth movement and consumerism. We have become friends with the Vietnamese, you would think we could do the same with Iran, and reap the commercial benefits. But if you hate Iran, why do you hand them a huge victory at the expense of the Saudi’s, our supposed ally? And at the expense of the most reliable and democratic ally in the region, the Kurds.

It is probably inevitable that as autocrats push forward with violent and lethal attacks on the media and the truth, demonstrably false stories get the headlines and dominate the discussion. Climate change is not a hoax helping China. It is a threat to civilization. And is totally preventable. Cutting taxes primarily shovels money to the richest people, while everyone else is falling behind. It does not create growth. And in fact 90% of what is called growth ends up in the hands of 1% of the population while everyone else in the developed world falls further behind. Many states in the USA tanked their economies by cutting taxes for the rich. And no community is better off for exacerbating climate change. Interestingly both lies, the two most pernicious on the planet, are partially the work of the same family, the Koch’s of Chesapeake Oil and the many think tanks that they fund. Making it easier to pollute does not help communities or economies, it actually makes people sick and costs us money, while the innovations to keep our communities healthier and our air and water cleaner create huge economic benefits. You can not have infinite growth on a finite planet no matter what the economists say and the politicians promise. And climate change will kill people and tank the economy. I think my readers can tell which of those is calling out the lies and which are actual truths.

The Trump tax cut did spur growth, for about 2 quarters, and spurred nowhere near the investment in infrastructure or manufacturing that was touted. It was consumption based and is unsustainable, mostly based on debt and borrowing rather than actual production gains. Inequality and debt are again reaching epic proportions, even if unemployment is temporarily low.

One of the myths used to perpetuate the power of the wealthy is the myth that a good business climate helps the economy. This is an article of faith everywhere you go except in those places where people have come to realize that all economic growth is doing is making the economy work less well, and depleting the resource base that will be necessary to keep future generations healthy and prosperous. As Jared Diamond of “Guns, Germs, and Steel” fame noted in a recent National Geographic, per capita income in the western nations will slowly dip towards the global mean as low income countries move up towards it. And it will be much lower than the mean of western countries today due to resource depletion, climate change, and ever more people. Planning for this makes much more sense than pushing for ever more growth.

The myth of the efficacy of the business climate is relatively easily testable using statistical methods. Either there is a statistically significant correlation between a good business climate ranking or at least some versions or some sliver of the business climate agenda and the growth rate of the GDP in the place receiving the high or low rankings or there is not. If there is no correlation then one has to assume that there can not be causation, though if there is correlation you can not assume there is causation, but must demonstrate it. If business climate rankings truly correlated with growth rates the economic development professionals and the politicians, as well as the billionaires that fund the think tanks that tout the business climate agenda would broadcast the results everywhere. The Providence Journal would make it front page news. I regularly look for such results to no avail. I have repeatedly challenged the media to find such a study. I have asked eminent business professors at URI, in fact right after they testified extensively on the importance of business climates as a reason to build the Fane 46 story debacle on the river. No one has come up with a single study legitimate demonstrating the correlation. Google it. Most of what you get says there is no correlation. The other studies were paid for by partisans and offer the results that were paid for.