Brooks, Cohen and Krugman

September 12, 2014

In “The Reluctant Leader” Bobo says President Obama’s obvious reluctance about expanding the attack on ISIS may be his greatest asset.  Mr. Cohen, in “Auchtermuchty to England,” says it may not be a bad thing if the Scots go it alone. But it’s still uncertain whether an independent Scotland would cut it.  Apparently he hasn’t been reading what Prof. Krugman has had to say…  In “The Inflation Cult” Prof. Krugman says we’re still trying to figure out the persistence and power of the people who keep predicting runaway inflation.  Here’s Bobo:

Moses, famously, tried to get out of it. When God called on him to lead the Israelites, Moses threw up a flurry of reasons he was the wrong man for the job: I’m a nobody; I don’t speak well; I’m not brave.

But the job was thrust upon him. Though he displayed some of the traits you’d expect from a guy who would rather be back shepherding (passivity, whining), he became a great leader. He became the ultimate model for reluctant leadership.

The Bible is filled with reluctant leaders, people who did not choose power but were chosen for it — from David to Paul. The Bible makes it clear that leadership is unpredictable: That the most powerful people often don’t get to choose what they themselves will do. Circumstances thrust certain responsibilities upon them, and they have no choice but to take up their assignment.

History is full of reluctant leaders, too. President Obama is the most recent. He recently gave a speech on the need to move away from military force. He has tried to pivot away from the Middle East. He tried desperately to avoid the Syrian civil war.

But as he said in his Nobel Peace Prize lecture, “Evil does exist in the world.” No American president could allow a barbaric caliphate to establish itself in the middle of the Middle East.

Obama is compelled as a matter of responsibility to override his inclinations. He’s obligated to use force, to propel himself back into the Middle East, to work with rotten partners like the dysfunctional Iraqi Army and the two-faced leaders of Qatar. He’s compelled to provide functional assistance to the rancid Syrian regime by attacking its enemies.

The defining characteristic of a reluctant leader is that he is self-divided. He feels compelled to do things he’d rather not do. This self-division can come in negative and positive forms.

The unsuccessful reluctant leader isn’t really motivated to perform the tasks assigned to him. The three essential features of political leadership, Max Weber wrote, are passion, responsibility and judgment. The unsuccessful reluctant leader is passionless. His actions are halfhearted. Look at President Obama’s decision to surge troops into Afghanistan at the same instant he announced their withdrawal date. That’s a reluctant leader undercutting himself. If Obama approaches this campaign that way then he will withdraw as soon as the Iraqi government stumbles, or the Iraqi Army fails to defeat the Islamic State in Iraq and Syria on the ground.

The successful reluctant leader, on the other hand, is fervently motivated by his own conscience. He forces himself to embrace the fact that while this is not the destiny he would have chosen, it is his duty and he will follow it to the end.

This kind of reluctant leader has some advantages over a full-throated, unreluctant crusader. Unlike George W. Bush in 2003, he’s not carried away by righteous fervor. The successful reluctant leader can be selfless. He’s not doing the work because it’s the expression of his inner being. He’s just an instrument for the completion of a nasty job.

The reluctant leader can be realistic about goals. President Obama can be under no illusions that he is going to solve the Middle East’s fundamental problems, but at least he can degrade ISIS the way we degraded Al Qaeda. Sometimes just preventing something bad — like the fall of the Jordanian regime — is noble enough, even if negative victories don’t exactly get you in the history books.

The reluctant leader can be skeptical. There’s a reason President Obama didn’t want to get involved in this conflict. Our power to manage history in the region is limited. But sometimes a reluctant leader can make wise decisions precisely because he’s aware of his limitations. If you’re going to begin a military campaign in an Arab country, you probably want a leader who’d rather not do it.

The reluctant leader can be dogged. Sometimes when you’re engaged in an unpleasant task, you just put your head down and trudge relentlessly forward. You don’t have to worry about coming down from prewar euphoria because you never felt good about this anyway.

The reluctant leader can be collaborative. He didn’t want his task, so he’s eager to share it. The Arab world can fully trust that Obama doesn’t have any permanent designs on their region because the guy is dying to wash his hands of the whole place as soon as possible.

Everybody is weighing in on the strengths and weaknesses of the Obama strategy. But the strategy will change. The crucial factor is the man. This is the sternest test of Obama’s leadership skills since the early crises of his presidency. If he sticks to this self-assigned duty, and pursues it doggedly, he can be a successful reluctant leader. Sometimes the hardest victories are against yourself.

In the comments “ScottW” from Chapel Hill, NC had this to say:  “What we really need are more “reluctant columnists” who realize since they were so wrong about the Iraq war 11 years ago, they should put away their pens and not comment about the current situation.”  Oh, if only…  Now here’s Mr. Cohen, writing from Auchtermuchty, Scotland:

“Conservatives only come to Scotland to shoot grouse, do they not?”

That was the withering verdict of John Latham as he enjoyed a pint in the Cycle Tavern in Auchtermuchty. Locals say southerners have trouble with the name, which means uplands of the wild boar, flattening the guttural “chhh” to a “k” and failing to deploy “plenty of spittle.” Be that as it may, Latham’s dismissal of English Tories is near universal in Scotland, where just over four million voters will decide next week on whether to opt for independence and cast Great Britain into the dustbin of history.

The news would trend on Twitter. Great Britain has had a pretty good run since it was formed by the union of Scotland and England in 1707.

David Cameron, the British prime minister, is a Tory, of course. That is part of the problem. To Scots he is the spoon-fed “rich toff” from Central Casting who never knew the price of a loaf of bread. He’s the emblem of a money-oozing London that has lost touch with the rest of the country.

Scotland wants to do things another way. It sees itself as a Scandinavia-like bastion of social democracy in the making: Norway with whisky. That, at least, is the vision of Alex Salmond, the charismatic leader of the Scottish National Party. Whether an independent Scotland would have the money for comprehensive welfare is another question. Salmond is skirting that for now. A mist of vagueness hovers over how an independent Scotland would cut it. He has a new favorite line in these frenetic last days: “Team Scotland against Team Westminster.”

“Team Westminster,” it has to be said, is giving a convincing impression of panic as the Sept. 18 vote approaches. Several polls now show the referendum as too close to call. Cameron’s complacency over a comfortable “No” vote has vanished. The pound is slumping.

The Saltire, or Scottish flag, was abruptly hoisted over 10 Downing Street, the prime minister’s residence. Cameron zoomed up to Scotland to declare it’s not about “the effing Tories” but love of a country he would be “heartbroken” to lose. Ed Miliband, the opposition Labour leader, also discovered his inner Scotland. He hurtled north to deliver an impassioned appeal. Nick Clegg, Cameron’s Liberal Democrat sidekick in the coalition government, said something; just what nobody can remember. Gordon Brown, a Scot and former prime minister, was wheeled out to say maximum devolution of powers would begin on Sept. 19 if Scotland only sticks with Britain.

All of which has caused amusement in Auchtermuchty and beyond. “If we’re going to fail on our own, why are they so concerned?” said Stephanie Murphy, as she poured another pint. “Aye,” said Latham, “If they want us so bad, maybe we should go.” The sudden Westminster flurry smacks of too little, too late.

Still, going it alone is a risk. “I have a pension, I don’t want to lose it,” said Andrew Dewar. “You’ve got 16-year-old first-time voters watching ‘Braveheart’ and believing we’ll be fine. Salmond says we’ll be like Norway. Well, in Norway a pint costs nine pounds — so hopefully not!” Debbie Marton suggested that, “Maybe we could have a trial period!” That won’t happen: The decision will be binding.

Some Scots have not forgotten that the union of 1707 came about in part because Scotland was bankrupt, having embarked on a mad-cat scheme, now known as the “Darien Disaster,” in a Panamanian malarial swamp.

Scots poured money into the Darien Company believing the Panamanian outpost would turn the country into a giant of global trade. Instead, many met a quick death — as did the project.

My non-scientific survey of voters in St. Andrews, Auchtermuchty and Edinburgh found many people still undecided, torn between a heart that says “yes” and a mind that says “no.” They’d love to “set England afloat” but worry what would happen to pensions, the National Health Service, jobs, the currency and membership in the European Union. Latham, a wine salesman, is hesitant himself, but says, “It’s one of those wee chances in life you may just have to take.”

The truth is nobody knows the answers to all the questions because nobody thought it would come to this. Cameron and Salmond have both been reckless. Now there is an almost surreal quality to Great Britain’s possible demise.

I blame Cameron above all. His deluded rhetoric about possible withdrawal from the European Union, his lack of feel for ordinary people and his glib marketer’s patter over matters great and small have all smacked of little-England smugness — so Scots have every right to make England as little as it often acts. The union’s history is a great one. Its end would be sad. But Scotland has what it takes. The good sense and tolerance that marked the union would in the end prevail across the new border.

Now here’s Prof. Krugman:

Wish I’d said that! Earlier this week, Jesse Eisinger of ProPublica, writing on The Times’s DealBook blog, compared people who keep predicting runaway inflation to “true believers whose faith in a predicted apocalypse persists even after it fails to materialize.” Indeed.

Economic forecasters are often wrong. Me, too! If an economist never makes an incorrect prediction, he or she isn’t taking enough risks. But it’s less common for supposed experts to keep making the same wrong prediction year after year, never admitting or trying to explain their past errors. And the remarkable thing is that these always-wrong, never-in-doubt pundits continue to have large public and political influence.

There’s something happening here. What it is ain’t exactly clear. But as regular readers know, I’ve been trying to figure it out, because I think it’s important to understand the persistence and power of the inflation cult.

Whom are we talking about? Not just the shouting heads on CNBC, although they’re certainly part of it. Rick Santelli, famous for his 2009 Tea Party rant, also spent much of that year yelling that runaway inflation was coming. It wasn’t, but his line never changed. Just two months ago, he told viewers that the Federal Reserve is “preparing for hyperinflation.”

You might dismiss the likes of Mr. Santelli, saying that they’re basically in the entertainment business. But many investors didn’t get that memo. I’ve had money managers — that is, professional investors — tell me that the quiescence of inflation surprised them, because “all the experts” predicted that it would surge.

And it’s not as easy to dismiss the phenomenon of obsessive attachment to a failed economic doctrine when you see it in major political figures. In 2009, Representative Paul Ryan warned about “inflation’s looming shadow.” Did he reconsider when inflation stayed low? No, he kept warning, year after year, about the coming “debasement” of the dollar.

Wait, there’s more: You find the same Groundhog Day story when you look at the pronouncements of seemingly reputable economists. In May 2009, Allan Meltzer, a well-known monetary economist and historian of the Federal Reserve, had an Op-Ed article published in The Times warning that a sharp rise in inflation was imminent unless the Fed changed course. Over the next five years, Mr. Meltzer’s preferred measure of prices rose at an annual rate of only 1.6 percent, and his response was published in another op-ed article, this time in The Wall Street Journal. The title? “How the Fed Fuels the Coming Inflation.”

So what’s going on here?

I’ve written before about how the wealthy tend to oppose easy money, perceiving it as being against their interests. But that doesn’t explain the broad appeal of prophets whose prophecies keep failing.

Part of that appeal is clearly political; there’s a reason why Mr. Santelli yells about both inflation and how President Obama is giving money away to “losers,” why Mr. Ryan warns about both a debased currency and a government that redistributes from “makers” to “takers.” Inflation cultists almost always link the Fed’s policies to complaints about government spending. They’re completely wrong about the details — no, the Fed isn’t printing money to cover the budget deficit — but it’s true that governments whose debt is denominated in a currency they can issue have more fiscal flexibility, and hence more ability to maintain aid to those in need, than governments that don’t.

And anger against “takers” — anger that is very much tied up with ethnic and cultural divisions — runs deep. Many people, therefore, feel an affinity with those who rant about looming inflation; Mr. Santelli is their kind of guy. In an important sense, I’d argue, the persistence of the inflation cult is an example of the “affinity fraud” crucial to many swindles, in which investors trust a con man because he seems to be part of their tribe. In this case, the con men may be conning themselves as well as their followers, but that hardly matters.

This tribal interpretation of the inflation cult helps explain the sheer rage you encounter when pointing out that the promised hyperinflation is nowhere to be seen. It’s comparable to the reaction you get when pointing out that Obamacare seems to be working, and probably has the same roots.

But what about the economists who go along with the cult? They’re all conservatives, but aren’t they also professionals who put evidence above political convenience? Apparently not.

The persistence of the inflation cult is, therefore, an indicator of just how polarized our society has become, of how everything is political, even among those who are supposed to rise above such things. And that reality, unlike the supposed risk of runaway inflation, is something that should scare you.

Krugman’s blog, 9/10/14

September 11, 2014

There was one post yesterday, “Even More on Scotland:”

I’m going on Channel 4 in a couple of hours, and doing more homework. One thing that is likely to come up is the fact that some reputable economists (pdf) have concluded that Scotland-on-the-pound would be OK. What’s my answer?

It is, in short, that this analysis doesn’t seem to reflect the unpleasant things we’ve learned from the euro crisis. To be blunt, the reassurances from the working group sound like the kind of thing euro defenders used to say pre-2010. Unfortunately, we’ve discovered that sharing a currency without sharing a government is a lot more dangerous than even euro skeptics realized.

We are told, for example, that Scotland need not worry because its fiscal position is relatively strong. But that was true — or appeared to be true — of Spain and Ireland before the euro crisis. What we’ve learned, alas, is that a seemingly strong fiscal position can evaporate very fast in a crisis — especially if banks need to be bailed out. In that context, it’s interesting to note that Scotland’s banks are very big relative to the size of the country, because they serve much of the UK. Nothing wrong with that as long as you have a political union; but without, what’s to prevent an Irish-type situation in which a small country is trying to bail out big banks?

We’re also told that the Bank of England would of course provide liquidity — in effect, act as lender of last resort — to Scottish banks. Are we sure about this? It took the ECB years to step up to the plate in the euro crisis, in part because it turned out that you needed a lender of last resort to governments as well as fInancial institutions; even now, the ECB’s efforts rely to an important extent on a bluff, in the sense that nobody knows what would happen if OMT were actually required. Assuming that England — possibly an England run by a Conservative-UKIP coalition! — would be there when needed is a big leap of faith.

An earlier version of this blog post misspelled the given name of the president of the National Front in France. It is Marine Le Pen, not Marie.

Let me say that I do understand why some people would like to be out of David Cameron’s UK — just as some of us coastal liberals occasionally wonder what America could be like without the old Confederacy. But getting currency realities right is crucial. The European project is a noble idea, and the euro is a grand gesture in support of that idea — but the willingness to ignore macroeconomics for the sake of that grand gesture may end up making Marine Le Pen president of France. You really have to get these things right, or else.

Blow, Kristof and Collins

September 11, 2014

In “The Cost of War” Mr. Blow says Americans must think about what it means to engage in another foreign war, and weigh that against the urgent needs we have at home.  Mr. Kristof offers a “Critique From an Obama Fan” and says the president is right to expand the attack on ISIS into Syria if it’s done prudently with modest goals.  In “A Man With a Plan” Ms. Collins says President Obama makes a comeback from weeks in which he was attacked for everything from playing golf to saying “we don’t have a strategy yet.”  Here’s Mr. Blow:

Here we go again.

Wednesday night, during a prime-time speech, the president laid out his plan for dealing with the Islamic State in Iraq and Syria, known as ISIS.

He made clear that “while we have not yet detected specific plotting against our homeland,” he still “will not hesitate to take action against ISIL in Syria, as well as Iraq.”

He called it “a comprehensive and sustained counter-terrorism strategy” and not a war. Yet, for all practical purposes, a war seems to be what it will be.

And most Americans, before the speech, seemed to be on board if not leading the way.

According to a Washington Post/ABC News poll published Tuesday, a vast majority of Americans see ISIS as a threat to the United States, a slight majority believe the president hasn’t moved aggressively enough, and most support expanding United States airstrikes into Syria.

But I implore the president and the nation to proceed with caution.

We can kill anti-American fighters and even their leaders, but we can’t kill anti-American sentiment. To some degree, every time we commit our forces in the Middle East we run the risk of further inflaming that sentiment.

For every action, there is a reaction. And there are also consequences, some of them unintended.

The president said that his plan “will not involve American combat troops fighting on foreign soil.” But this seems a hard thing to completely guarantee. It seems reasonable to worry that it could lead to at least some American boots on the ground and some American blood soaked into it.

The president did, however, say:

“We will send an additional 475 service members to Iraq. As I have said before, these American forces will not have a combat mission — we will not get dragged into another ground war in Iraq.”

But missions creep, wars get foggy and the very definition of victory can become elusive.

And need I remind you, we’ve been here before, worked up into a patriotic tizzy, fears stoked and muscles flexed. Although nothing may soon rival the staggering deception and disaster of the Iraq war, it still stands as our most recent and most instructive lesson about committing to armed conflict. George Bush and Dick Cheney are in a category of their own.

When we invaded Iraq in 2003, about three out of four Americans approved of President Bush’s handling of the situation, according to a USA Today/Gallup poll. Three years later, that approval had fallen by half.

We don’t want to look back three years from now and ask, “What have we done?”

An ABC News poll in early March of 2003 found that most Americans believed the Iraq war would last several months at most — it officially lasted nearly nine years — and nearly eight in 10 thought Iraq posed a direct threat to the United States at the time.

And the cost of that war, particularly in death toll, was staggering.

According to the website Iraqbodycount.org, more than 4,800 members of United States and coalition forces were killed between 2003 and 2013, as well as 468 contractors.

An NBC News/Wall Street Journal poll conducted the month we invaded found that nearly seven in 10 Americans thought the final result of the Iraq war would be that we would “win,” whatever that meant. Most Americans also thought that we should do everything we could to minimize Iraqi civilian casualties.

And while it is not clear how many civilian deaths resulted solely from United States military action in that country, Iraqbodycount.org puts the total number of Iraqi civilian deaths “from violence” since 2003 as high as 144,000.

Furthermore, a March 2013 study estimated that the financial cost of the Iraq war could be more than $2 trillion.

And now, to compound the waste of money, with our air offensive we are essentially paying to blow up millions of dollars of our own equipment that we left behind in Iraq, as Jason Fields wrote for Reuters last month.

As Fields puts it:

“And Islamic State’s captured an enormous amount of U.S. weaponry, originally intended for the rebuilt Iraqi Army. You know — the one that collapsed in terror in front of the Islamic State, back when they were just ISIL? The ones who dropped their uniforms, and rifles and ran away? They left behind the bigger equipment, too, including M1 Abrams tanks (about $6 million each), 52 M198 howitzer cannons ($527,337), and MRAPs (about $1 million) similar to the ones in use in Ferguson.”

Fields continues:

“Now, U.S. warplanes are flying sorties, at a cost somewhere between $22,000 to $30,000 per hour for the F-16s, to drop bombs that cost at least $20,000 each, to destroy this captured equipment. That means if an F-16 were to take off from Incirlik Air Force Base in Turkey and fly two hours to Erbil, Iraq, and successfully drop both of its bombs on one target each, it costs the United States somewhere between $84,000 to $104,000 for the sortie and destroys a minimum of $1 million and a maximum of $12 million in U.S.-made equipment.”

We are doing this at a time when many of our roads and bridges are crumbling beneath us. The American Society of Civil Engineers estimates that we need to invest $3.6 trillion in infrastructure by 2020.

The Department of Agriculture released a report this month saying that the percentage of Americans who are “food insecure” (lacking “access to enough food for an active, healthy life”) has remained relatively unchanged (14.3 percent) since the numbers spiked during the recession in 2008.

And yet, in February, the 2014 Farm Bill was signed into law, a bill that will, according to MSNBC, “cut $8.7 billion in food stamp benefits over the next 10 years, causing 850,000 households to lose an average of $90 per month.”

We are still arguing about the cost of the Affordable Care Act and Republicans are still wasting time and money trying to repeal it.

We, as Americans, must think long and hard about what it will really mean for us to engage in another foreign war and weigh that against the urgent needs we have right here at home.

Next up we have Mr. Kristof:

I’m probably one of the few Americans left with some sympathy for President Obama’s foreign policy, and even I have to admit that his Syria policy has been a mess.

His “red line” about chemical weapons turned out to be more like a penciled suggestion. His rejection of the proposal by Hillary Rodham Clinton and David Petraeus to arm moderate Syrian factions tragically empowered both the Islamic State in Iraq and Syria, or ISIS, and President Bashar al-Assad of Syria.

Dismissing ISIS as a “J.V. team,” as Obama did in January, was silly — compounded by the White House’s contorted attempts to deny that he had said that. Obama’s ambassador to Syria, Robert Ford, resigned this year because he found our government’s policy impossible to defend.

The tragedy in Syria isn’t Obama’s fault, but that of Syrians; still, the president has been painfully passive toward what has unfolded: the deaths of nearly 200,000 Syrians, the destabilization of neighboring countries by three million refugees, the near collapse of Iraq, the beheading of two American journalists, mass atrocities against Yazidi and Christian religious minorities and growing risks of ISIS terrorism against American and European targets.

And, yes, that’s the judgment of an Obama fan.

So it’s just as well that the president is trying for a reset — oops, wrong word — let’s just say “a new strategy” in Syria.

“America will lead a broad coalition to roll back this terrorist threat,” Obama declared in his speech Wednesday night. He described it as a “counterterrorism campaign” that would “degrade and ultimately destroy” ISIS.

There’s some inconsistency there. Counterterrorism is the right prism through which to approach this, rather than all-out war, but it’s unlikely to destroy ISIS any more than it did the Taliban or militancy in Yemen.

Indeed, the president, in his speech, said that his strategy in  Syria “is one that we have successfully pursued in Yemen and Somalia for years.” That’s a plausible comparison, but Obama may be the only person in the world who would cite conflict-torn Yemen and Somalia as triumphs.

Unfortunately, there are more problems than solutions in international relations, and calls for more aggressive action by some Republican critics could make things worse. Dick Cheney has compiled an almost perfect record of being wrong on foreign affairs, so, on Wednesday, when he called for the United States to be more aggressive and get “back on offense,” we should all insist upon caution.

My take is that Obama is right to expand military action against ISIS into Syria if it’s done prudently with modest goals of containing and degrading a terror group. ISIS is a proper target, having butchered Americans, dismembered Iraq and attempted genocide against minorities like the Yazidis.

A 17-year-old Yazidi girl told the Italian newspaper La Repubblica in a phone call that she was being kept by ISIS as a sex slave along with many others. The newspaper got her cellphone number from her parents, who are in a refugee camp.

“They treat us as if we are their slaves,” the newspaper quoted the girl as saying. “The men hit us and threaten us when we try to resist. Often I wish that they would beat me so severely that I would die.”

ISIS also could pose a terror threat within the United States. At least 100 and perhaps many more Americans have traveled to Syria to join jihadi groups, and some could return to carry out attacks.

So striking ISIS in Syria makes sense, but we also have to recognize that airstrikes will be of limited benefit and carry real risks as well.

“We’re going to war because we’ve been spooked,” notes Joshua Landis, a Syria specialist at the University of Oklahoma. “But if we do it wrong, we could ensure that the violence spreads.”

One danger is that if our bombs kill innocents, ISIS would use its video-making and social media skills to galvanize the Sunni Islam world, saying the American “infidels” who are slaughtering Sunni children must be punished. That’s why it’s crucial to have Sunni partners, including United Arab Emirates, Turkey and Saudi Arabia.

We also need a partner on the ground to take advantage of airstrikes and seize back territory. That means moderate Syrian rebels, but there are many fewer of them now than there were two years ago. The middle has been vanishing.

Bolstering the Syrian opposition is still worth trying, and a senior administration official says that the White House will try to expand support. But there’s a danger that more arms will lead not to the destruction of ISIS but to the creation of another Somalia.

So let’s move ahead with eyes wide open. We’ve seen the perils of Obama’s inaction, and let’s now avoid the perils of excessive action.

And now here’s Ms. Collins:

It’s a tough time to be a concerned citizen. The truth of the matter is, the job has always been messy.

But it’s way worse when the subject is foreign policy.

We gathered around our TVs and computers and peered at our smartphones Wednesday night to hear President Obama explain his plan for combating ISIS, even though we have pretty much lost faith in plans when it comes to the United States involvement in the Middle East.

He sounded very strong. And, really, that’s something. We’d have been happy to come away just saying something like “he appeared to believe he’s on the right track.”

The problem with the substance was that when it comes to Iraq and Syria, we’re too good at imagining the downside. The president said he had waited to launch his plan until Iraq got an inclusive government. That certainly made sense. Except that we have children entering middle school who had not been born when we started waiting for Iraq to get an inclusive government.

Then there’s the arming of Syrian rebels. No surprise that Obama wants an ally that isn’t the Assad regime. But some of the fighters in ISIS were Syrian rebels. Obviously, the administration feels its rebels are not going to become anti-Western terrorists. But the anti-Western terrorists in ISIS are waving around a ton of our weaponry that they took from the allies we armed in Iraq. Just saying.

Obama promised no American combat troops would be sent into battle. We don’t want boots on the ground. The idea of airstrikes sound much safer. Unless you happen to be an innocent civilian in the vicinity.

The president assured the American people that the strategy of air power plus “support for partner forces” would work because it’s already been a big success in Yemen and Somalia. Concerned citizens then turned to each other and said: “Yemen and Somalia?”

The hardest thing for average Americans is knowing just how worried to be. The tone of alarm in Washington has been hyper-shrill. Denouncing the president’s failure to take on ISIS faster, Representative Michele Bachmann told The Huffington Post: “We haven’t seen anything like this since Hitler and the blitzkrieg in World War II.”

Well, Michele Bachmann. Who is a member of the House Intelligence Committee.

During the run-up to the speech, Republicans had been irate about the president’s failure to act sooner, explain his plan faster and, in general, be tougher. Never had so many people demanded specifics without ever offering any of their own.

“President Obama’s chronic passivity has helped the jihadists,” John Cornyn of Texas, the second-ranking Senate Republican, said in a floor speech this week. Cornyn slammed the administration’s “don’t do stupid stuff” mantra, claiming Obama “doesn’t seem to fully grasp the magnitude of the threats and challenges that America is now dealing with.”

Cornyn mixed up Iranians and Iraqis a few times, but concerned citizens understand that these things get complicated. More to the point, not doing something stupid is actually a super foreign policy goal. Just look back on our recent history of meddling in the Middle East and what do you see? A heck of a lot of stupid stuff we wish we hadn’t done.

In his speech, the president was pushing back after weeks in which he was attacked for everything from playing golf on his vacation to saying “we don’t have a strategy yet” on the ISIS surge in Syria. On that, the critics had a point. You’re not supposed to say you don’t have a strategy. Even when everything on the ground has shifted and you need to consult your allies, get the Iraqi government to reorganize and collect new intelligence. You still don’t say “no strategy.” You say, “I’ll discuss strategy after I brief the congressional leaders.” And then fail to invite them.

Anyway, now there’s definitely a strategy. The hawks in Congress were not all necessarily overwhelmed. “The president doesn’t really have a grasp of how serious the threat of ISIS is,” said Senator John McCain on CNN. Other Republicans, like House Speaker John Boehner, issued responses that began with, “Finally …”

And how about the concerned citizens? We’re feeling insecure. It’s comforting to have Dick Cheney around, so we can at least know what we definitely want to avoid. This week, in a Washington speech, the former vice president said Obama has to “understand we are at war and that we must do what it takes, for as long as it takes, to win,” and spend way more money on defense.

Which means that:

A) Fighting ISIS is going to be more complicated than just war.

B) The president should put timetables on everything.

C) The defense budget needs to go down.

Remember that no matter what else happens, Dick Cheney will never steer us right.

Krugman’s blog, 9/9/14

September 10, 2014

There were two posts yesterday.  The first was “Scotland and the Euro Omen:”

Let me restate and possibly clarify the points from yesterday’s column:

Declaring Scotland independent would mean a big disruption of existing economic and financial arrangements. As Simon Wren-Lewis says, the preponderance of professional economic opinion is that this disruption would leave Scotland worse off, but that is a point we can argue. However, that is not the argument the independence movement is making; what they have been telling voters is that there would be no disruption — in particular, that Scots could continue using the pound, and that this would pose no problem.

This is an astonishing claim to make at this point in history. Economists (starting with my late colleague and friend Peter Kenen) have long argued that sharing a currency without fiscal integration is problematic; the creation of the euro put that theory to the test. And the results have been far worse than even the harshest critics of the euro imagined, with euro Europe doing worse at this point than Western Europe did in the 1930s:

And an independent Scotland using the British pound would arguably be in even worse shape. Europe has somewhat stabilized recently thanks to Mario Draghi’s support for debtor countries — but Draghi is able to do this, in large part, because he is answerable to the whole euro area, not just Germany. An independent Scotland would be dependent on the kindness of the Bank of, um, England, with no say whatsoever in that bank’s policy.

I’ve read quite a lot of the independence literature, and it shows no appreciation for the dangers involved. What Scottish voters should do is look hard at the experience, just across the North Sea, of divorcing currency from statehood; it’s not encouraging.

Yesterday’s second post was “The Structural Fetish:”

The FT has a pretty decent article on the emerging doctrine of “Draghinomics”, which looks a lot like Blanchardnomics, which looks a lot like Krugmanomics — hey, we all studied macro at MIT in the mid 1970s. But I was struck by this bit:

One other senior eurozone official attending the Italian forum which gathers together policy makers, business people and academics said: “Structural reforms are key. Those countries that have made these efforts are performing better: Ireland, Spain and Portugal. Italy and France should think a little bit about this.”

Yep, Spain offers a useful lesson for France:

For those of us not part of the structural reform cult, the story of Spain is this: the country experienced a full-scale depression when its housing bubble burst; this depression has led to a gradual, painful “internal devaluation” as labor costs come down, making Spain more competitive within Europe; and as a result, Spain is finally starting a slight recovery, with its growth rate in recent quarters (but only in recent quarters) higher than France. To see this as a triumph of structural reform requires preconceptions so strong it’s hard to see why you would even bother looking at data.

Friedman and Bruni

September 10, 2014

Oh, frabjous day!  The Times has decided that one dose of MoDo a week is sufficient!  That’s the good news.  The bad news is that she’ll be on Sunday, a day they’re already ruining with The Pasty Little Putz.  Today we have The Moustache of Wisdom and Mr. Bruni.  In “It Takes a Mentor” The Moustache informs us that Gallup says successful students had one or more teachers who were mentors, and they had an internship related to what they were learning in school.  Mr. Bruni, in “American Horror Story,” says the status quo is cursed, but it’s not about to change. That’s the great, ugly paradox of the 2014 midterm elections.  Here’s The Moustache:

With millions of students returning to school — both K-12 and college — this is a good time to review the intriguing results of some research that Gallup did over the past year, exploring the linkages between education and long-term success in the workplace. That is: What are the things that happen at a college or technical school that, more than anything else, produce “engaged” employees on a fulfilling career track? According to Brandon Busteed, the executive director of Gallup’s education division, two things stand out. Successful students had one or more teachers who were mentors and took a real interest in their aspirations, and they had an internship related to what they were learning in school.

“We think it’s a big deal” where we go to college, Busteed explained to me. “But we found no difference in terms of type of institution you went to — public, private, selective or not — in long-term outcomes. How you got your college education mattered most.”

Graduates who told Gallup that they had a professor or professors “who cared about them as a person — or had a mentor who encouraged their goals and dreams and/or had an internship where they applied what they were learning — were twice as likely to be engaged with their work and thriving in their overall well-being,” Busteed said.

Alas, though, only 22 percent of college grads surveyed said they had such a mentor and 29 percent had an internship where they applied what they were learning. So less than a third were exposed to the things that mattered most.

Gallup’s data were compiled from polls of parents of 5th through 12th graders, business leaders and interviews with teachers, superintendents, college presidents, principals, college graduates, Americans ages 18 to 34, and students in grades 5 through 12. All told, “we collected the voices of close to one million Americans in the past year alone,” said Busteed, who added that he found the results “alarming” — not only because too few students are getting exposed to the most important drivers of workplace engagement, but because there is also a huge disconnect in perceptions of the problem.

Busteed said that 96 percent of the college provosts Gallup surveyed believed their schools were successfully preparing young people for the workplace. “When you ask recent college grads in the work force whether they felt prepared, only 14 percent say ‘yes,’ ” he added. And then when you ask business leaders whether they’re getting enough college grads with the skills they need, “only 11 percent strongly agree.” Concluded Busteed: “This is not just a skills gap. It is an understanding gap.”

This comes at a time when our country faces creative destruction on steroids thanks to the dynamism of technology and growing evidence that climbing the ladder of job success requires constant learning and relearning. Therefore, the need for schools to have a good grasp of what employers are looking for and for employers to be communicating with schools about those skills is greater than ever.

Some help may be on the way from Washington. Last year, President Obama quietly asked Vice President Joe Biden to oversee an overhaul of the government’s education-to-work programs after hearing from one too many employers across the country that, as one White House official put it, “they were having trouble hiring workers for some of their fastest-growing jobs,” such as operating sophisticated machine tools or software testing and debugging.

As they dove into the problem, said Byron Auguste, a White House deputy national economic adviser, they found that the success stories shared a lot of the same attributes that Gallup found to be differentiating. In successful programs, said Auguste, “students got as much applied, hands-on experience as possible, whether in a classroom or on a job site. Schools, colleges and training centers had close partnerships with regional employers, industry groups and skilled trade unions to stay up to date on job-relevant skills. And students or working learners got a lot of coaching and guidance to understand how to trace a direct path between their training today and careers tomorrow.”

The key now is to scale those insights. The Labor Department has awarded $1.5 billion in the last three years to more than 700 community colleges to develop employer-validated training programs for new careers like natural gas field work and cybersecurity. Later this month, another $500 million is set to be awarded as part of a kind of race-to-the-top for whoever can build the best community college-industry group partnership anywhere in the country where new industries are finding gaps in the kind of workers they need.

Employers used to take generalists and train them into specialists for their industry. But fewer employers want to do that today or can afford to in a globally competitive economy, especially when they fear they’ll train someone who will then leave for a competitor. So everyone wants employees out of college or technical schools who are as ready to plug and play as possible. That’s why government has a role in fostering more and more employer-educator partnerships — this is the new, new thing — which businesses, small and large, can benefit from, as well as all would-be employees.

Now here’s Mr. Bruni:

Like the smattering of other Americans who still pay close attention to the wearying spectacle of our country’s politics, I worry about what will happen on Nov. 4, the day of the midterm elections.

But I worry even more about what will happen the day after, when a nation of people fed up with the stubborn dysfunction of our country’s government realize that nothing’s going to change and we’re in for more of the same.

I worry about the combustible tension between our abysmal regard for the Congress that we’ve got and a near certainty that the Congress we’re about to get will be its spit and image: familiar faces, timeworn histrionics, unending paralysis.

Our history is such that we just keep returning the incumbents; our system is such that insurgents are few and far between. They lack the money, and politics is increasingly about money. They lack name recognition, and it’s the era of celebrity.

In all but one of the last five elections for the House, at least 90 percent of the incumbents vying for another term got one. In all but one of the last five Senate elections, at least 80 percent of incumbents fared similarly.

This would be a happy fact if Americans adored their government. But a new Gallup poll shows that only 14 percent approve of the job that Congress is doing.

In an ABC/Washington Post poll last month, a majority of Americans disapproved not only of Congress in general but of their own House members in particular. This departed from the norm. It charted a new frontier of disgust.

And it dovetailed with a belief among most Americans that the country is on the wrong track and in decline.

So on Nov. 4, it’s out with the bums?

Ha.

I asked Stuart Rothenberg, the political analyst behind The Rothenberg Political Report, to review the current House and Senate races and predict the rate of incumbent success. He estimated that between 90 and 96 percent of the House members running for re-election will be victorious, and between 78 and 90 percent of incumbent senators will.

Yes, there’s uncertainty over which party will wind up with control of the Senate.

But whatever happens, we’ll still have a Democratic president facing off against a Republican House, with all or much of the acrimony that this combination has produced for the past few years. The “fever” that President Obama talked about during the 2012 presidential campaign has never broken, and Nov. 4 won’t deliver the ibuprofen that at last does the trick.

No, it will deliver us to Nov. 5, at which point Senate and House leaders will begin to plot their every step in terms of whether it hurts or helps their party’s chances of taking the presidency in 2016.

That’s what dominates our politics: a war to gain or maintain turf, not a battle for a better America. You see that in the negativity and political gyrations of the 2014 campaigns.

Democrats are running away from the president, and I don’t mean just Kay Hagan of North Carolina and Mark Udall of Colorado, who wasn’t even in the state when Obama did a fund-raiser for him there. I mean Jeanne Shaheen of New Hampshire and Al Franken of Minnesota, who have questioned the administration’s response to Islamic extremists.

Republicans are running away from their party’s beleaguered brand and even their own pasts, as they discover newly calibrated positions on the minimum wage, say, or “personhood.”

But what are all these politicians running toward? I know more about what they want to destroy than about what they yearn to create. That’s partly because of all the campaign spending that’s funneled through outside groups, which tend not to produce inspiring ads for the candidates they support but blistering ones against the candidates they oppose.

The system is toxic that way, and seems to have only enough oxygen to recycle known people and ideas, not to introduce and nurture new ones. With Jeb Bush looking less likely to run, Republicans are reassessing Mitt Romney. If Hillary Clinton takes a pass, Joe Biden’s waiting, and it’s not impossible that Jerry Brown swoops in.

Even the supposed mold breaker and flavor du jour, Rand Paul, comes with a road-tested surname, a dynastic leg up.

How a country so rightly anxious about the days ahead stays fixed in the days behind is the great paradox of the 2014 elections.

Rothenberg told me that he used to think of this country’s politics as a comedy. “Now,” he said, “it’s a tear-jerker.”

I’ve been catching up with the first season of “American Horror Story,” and our political travails bring to mind the freaked residents of that foul house. They can sense their doom. But they can’t seem to get out.

Krugman’s blog, 9/8/14

September 9, 2014

There were two posts yesterday.  The first was “The Trillion Dollar Zombie:”

I’ve often remarked on the remarkable tenacity of the inflationista doctrine (Santellinomics? CNBCnomics?) among investors, given the fact that believing the people who have been warning about soaring inflation and interest rates would have lost you a lot of money. How much money? Cordell Eddings at BrookingsBloomberg puts a number to it: $1 trillion in gains on U.S. government bonds since QE began. Actually, this is arguably a low estimate; if you really believed in this stuff, you wouldn’t just have failed to hold US debt, you would have bet against it — as, for example, John Paulson (as described in the article) and Eric Cantor did.

And let’s be clear: those of us who understood the nature of liquidity traps predicted low rates of both interest and inflation from the beginning — in the face of loud declarations that this was absurd, that big deficits and rapid expansion of the monetary base would of course be inflationary. This has to be one of the most dramatic examples in the history of economics of a surprising, successful prediction.

Yet as far as I can tell, not one of the people who signed the infamous 2010 letter accusing Bernanke of debasing the dollar has admitted having been wrong, or shown even a hint of reconsidering. More to the point, perhaps, the doctrine has retained much of its hold. Look at the comments on that Bloomberg piece; most of them either declare that we do too have high inflation, but the feds are hiding it in Area 51, or that the data don’t matter because the Fed is manipulating rates (hey, it can do that without adverse consequences? Then why not?)

As I’ve written on a number of occasions, I think it’s fundamentally about affinity fraud. The consumers of this stuff like the attitude of the inflationistas — their hostility to helping the poor, their disdain for snooty professors, etc. And so they trust them no matter how bad their past results have been.

Yesterday’s second post was “My Head Talks About Minimum Wages:”

I did an interview over at Business Insider, and various pieces will be appearing over the next few days. The discussion of minimum wages is here.

Brooks, Cohen and Nocera

September 9, 2014

In “Becoming a Real Person” Bobo sighs that elite American universities give students extensive résumé guidance but seem to have forgotten the moral component of their mission.  Silly me — almost 69 years old and all this time I thought moral guidance was something that came from home and community, and started as soon as you were old enough to understand the word “no.”  In “A War of Choice in Gaza” Mr. Cohen says the fighting was unnecessary — it rehabilitated a beleaguered Hamas, and gained nothing for Israel.  Mr. Nocera is back to carrying water for Big Bidness.  In “Inversion Delusion” he actually tries to convince us that the argument is bogus that corporations leave the U.S. and set up overseas because of high corporate tax rates.   Here’s Bobo:

This summer, The New Republic published the most read article in that magazine’s history. It was an essay by William Deresiewicz, drawn from his new book, “Excellent Sheep: The Miseducation of the American Elite and the Way to a Meaningful Life.”

Deresiewicz offers a vision of what it takes to move from adolescence to adulthood. Everyone is born with a mind, he writes, but it is only through introspection, observation, connecting the head and the heart, making meaning of experience and finding an organizing purpose that you build a unique individual self.

This process, he argues, often begins in college, the interval of freedom when a person is away from both family and career. During that interval, the young person can throw himself with reckless abandon at other people and learn from them.

Some of these people are authors who have written great books. Some are professors who can teach intellectual rigor. Some are students who can share work that is intrinsically rewarding.

Through this process, a student is able, in the words of Mark Lilla, a professor at Columbia, to discover “just what it is that’s worth wanting.”

Deresiewicz argues that most students do not get to experience this in elite colleges today. Universities, he says, have been absorbed into the commercial ethos. Instead of being intervals of freedom, they are breeding grounds for advancement. Students are too busy jumping through the next hurdle in the résumé race to figure out what they really want. They are too frantic tasting everything on the smorgasbord to have life-altering encounters. They have a terror of closing off options. They have been inculcated with a lust for prestige and a fear of doing things that may put their status at risk.

The system pressures them to be excellent, but excellent sheep.

Stephen Pinker, the great psychology professor at Harvard, wrote the most comprehensive response to Deresiewicz. “Perhaps I am emblematic of everything that is wrong with elite American education, but I have no idea how to get my students to build a self or become a soul. It isn’t taught in graduate school, and in the hundreds of faculty appointments and promotions I have participated in, we’ve never evaluated a candidate on how well he or she could accomplish it.”

Pinker suggests the university’s job is cognitive. Young people should know how to write clearly and reason statistically. They should acquire specific knowledge: the history of the planet, how the body works, how cultures differ, etc.

The way to select students into the elite colleges is not through any mysterious peering into applicants’ souls, Pinker continues. Students should be selected on the basis of standardized test scores:the S.A.T.’s. If colleges admitted kids with the highest scores and companies hired applicants with the highest scores, Pinker writes, “many of the perversities of the current system would vanish overnight.”

What we have before us then, is three distinct purposes for a university: the commercial purpose (starting a career), Pinker’s cognitive purpose (acquiring information and learning how to think) and Deresiewicz’s moral purpose (building an integrated self).

Over a century ago, most university administrators and faculty members would have said the moral purpose is the most important. As Mary Woolley, the president of Mount Holyoke, put it, “Character is the main object of education.” The most prominent Harvard psychology professor then, William James, wrote essays on the structure of the morally significant life. Such a life, he wrote, is organized around a self-imposed, heroic ideal and is pursued through endurance, courage, fidelity and struggle.

Today, people at these elite institutions have the same moral aspirations. Everybody knows the meritocratic system has lost its mind. Everybody — administrators, admissions officers, faculty and students — knows that the pressures of the résumé race are out of control.

But people in authority no longer feel compelled to define how they think moral, emotional and spiritual growth happens, beyond a few pablum words that no one could disagree with and a few vague references to community service. The reason they don’t is simple. They don’t think it’s their place, or, as Pinker put it, they don’t think they know.

The result is that the elite universities are strong at delivering their commercial mission. They are pretty strong in developing their cognitive mission. But when it comes to the sort of growth Deresiewicz is talking about, everyone is on their own. An admissions officer might bias her criteria slightly away from the Résumé God and toward the quirky kid. A student may privately wrestle with taking a summer camp job instead of an emotionally vacuous but résumé-padding internship. But these struggles are informal, isolated and semi-articulate.

I’d say Deresiewicz significantly overstates the amount of moral decay at elite universities. But at least he reminds us what a moral education looks like. That is largely abandoned ground.

Drawing the veil of charity over Bobo, let us proceed to Mr. Cohen:

Another round of violence is over in the Holy Land. More than 2,100 Palestinians, most of them civilians and many of them children, have been killed. More than 70 Israelis are dead. The grass, in that appalling Israeli metaphor, has been mown (and will now start growing again). Hamas, through its resistance, has burnished its reputation among Palestinians. Israel is angrier. Nobody is better off.

Periodic eruptions are intrinsic to Prime Minister Benjamin Netanyahu’s strategy of maintaining the status quo of rule over millions of Palestinians, expansion of West Bank settlements and maneuver to deflect American mediation. Oppressed people will rise up. Israel’s anemic embrace of a two-state objective is the best possible cover for the evisceration of that aim. Still, the question arises: Was this mini-war necessary?

I think not. Certainly it was not in Israel’s strategic interest. Much mystery continues to shroud its genesis, the abduction on June 12 of three Israeli youths near Hebron and their murder, now attributed to a local Palestinian clan including Hamas operatives who acted without the knowledge or direction of the Hamas leadership. (There has been no major investigative piece in the American press on the incident, a troubling omission.)

But enough detail has emerged to make clear that Netanyahu leapt on “unequivocal proof” of Hamas responsibility (still unproduced) for political ends. The prime minister’s aim was to discredit Mahmoud Abbas, the president of the Palestinian Authority, for reconciling with Hamas; vindicate the collapse of the peace talks Secretary of State John Kerry had pursued; stir up Israeli rage over the fate of the teenagers; sweep through the West Bank arresting hundreds of suspected Hamas members, including 58 released under the terms of an earlier deal with Hamas; and consolidate divide-and-rule.

Assaf Sharon of Tel Aviv University, the academic director of a liberal think tank in Jerusalem, has a powerful piece in The New York Review of Books. It makes the important point that Hamas was beleaguered before the violence, isolated by the fall of the Muslim Brotherhood in Egypt and the rise of President Abdel Fattah el-Sisi. This weakness lay behind the reconciliation with Abbas. Netanyahu might have used this development to extend Abbas’s authority into a more open Gaza at the expense of Hamas, the very objective now apparently sought after so much needless loss of life.

For more than two weeks after the abduction, persuasive evidence that the teenagers were dead was kept from the Israeli public. A hugely emotional return-our-boys campaign was pursued while the recording of a phone call from one of those boys to the police in the immediate aftermath of the kidnapping was not divulged. In it, shots and cries of pain could be heard. As Shlomi Eldar wrote, “It was a murder in real time, horrifying and monstrous.” After it, “Those who heard the emergency call recording knew that the best one could hope for was to bring the boys to their final resting places.”

The effect of this concealment, whatever its justification, was to whip up an Israeli frenzy. This was the context in which a Palestinian teenager was killed by Israeli extremists. It was also the context of the drift to war: air campaign, Hamas rockets and tunnel raids, Israeli ground invasion. Drift is the operative word. Israel’s purpose was shifting. At different moments it included “zero rockets,” demilitarizing Gaza and destroying the tunnels. “Lacking clear aims, Israel was dragged, by its own actions, into a confrontation it did not seek and did not control,” Sharon writes.

The only certainty now is that this will happen again unless the situation in Gaza changes. That in turn necessitates Palestinian unity and renunciation of violence. It also hinges on a change in the Israeli calculus that settlement extension, a divided Palestinian movement, and vacuous blah-blah on a two-state peace are in its interest, whatever the intermittent cost in blood.

Two other recent pieces are essential reading in the aftermath of the fighting. The first is Connie Bruck’s “Friends of Israel” in The New Yorker, an examination of the political sway of the American Israel Public Affairs Committee, the pro-Israel lobby group. In it, she quotes Brian Baird, a former Democratic congressman, getting to the nub: “The difficult reality is this: in order to get elected to Congress, if you’re not independently wealthy, you have to raise a lot of money. And you learn pretty quickly that, if Aipac is on your side, you can do that.” She also quotes John Yarmuth, a congressman from Kentucky, on upholding the interests of the United States: “We all took an oath of office. And Aipac, in many instances, is asking us to ignore it.”

Finally, read Yehuda Shaul in The New Statesman on the corrosive effect of the occupation and his experience of military service in the West Bank: “We needed to erase the humanity of Palestinians along with our own humanity.”

And now we get to Joe “Gunga Din” Nocera:

On Monday, the Tax Policy Center in Washington held a panel discussion on the subject of “corporate inversions” — the practice of taking over a small company in someplace like Ireland or the Netherlands, and then using that takeover to “relocate” to the foreign country for tax reasons. One of the panelists was John Samuels, the chief tax lawyer for General Electric.

Samuels started by saying that even the most junior tax lawyers know that, when structuring a cross-border merger, “you should do whatever you can, whatever’s possible, to make sure the ultimate parent or acquirer is a foreign company, not a U.S. company, to avoid having the entire worldwide income caught up in the U.S. tax net.” He went on: “Virtually every major developed country in the world has dramatically reformed its tax system to make it more business-friendly.” He cited Britain as an example. “The U.K. recently abandoned its worldwide system for a territorial system [and] reduced its corporate tax rate to 21 percent.” Quoting the exchequer secretary to the Treasury, he added, Britain “wants to send out the signal loud and clear that Britain is open for business.”

The corporate tax rate in the United States is 35 percent, which is the highest in the industrialized world. And, unlike most other countries, it taxes a company’s worldwide earnings, at that same high rate, once they are repatriated into the United States. (That is what Samuels meant by a “worldwide system.”)

So, at first glance, Samuels’s analysis would seem to make sense: the disparity of our uncompetitive corporate tax rate versus their business-friendly rates must be driving the current mania for inversions. Many other corporate executives have made the same argument. Just a few months ago, Heather Bresch, the chief executive of Mylan, a $7 billion generic drug company, announced that her company would be doing an inversion that would place its new corporate address in the Netherlands, where the tax rate is 25 percent. She complained that the American corporate tax rate needed to become “more competitive.”

But upon closer inspection, this argument turns out to be mainly hogwash. As Edward D. Kleinbard put it in a recent report, “ ‘Competitiveness’ has nothing to do with it.”

Kleinbard, a law professor at the University of Southern California, has emerged as one of the leading critics of inversions. In his view, it isn’t so much that the corporate tax code is too tough or the rate is too high; rather, he says, companies are taking advantage of loopholes in the code that make inversions almost irresistible for corporate executives. As another critic, Kimberly Clausing of Reed College, wrote in a recent paper: “Both the high U.S. tax rate and the worldwide system of taxation have more bark than bite.”

For starters, American multinationals, with their high-powered tax departments, rarely pay 35 percent or anything close to it. And those earnings that are supposed to get taxed upon repatriation? Needless to say, they never get repatriated; by some estimates, $2 trillion in earnings by American multinationals reside, untaxed, outside the country.

Indeed, according to Kleinbard and other critics, gaining access to those earnings is a benefit of inversion. Clausing describes the tactic like this: Foreign affiliates of the American company lend money to the new foreign parent, skipping over the U.S. company and thus avoiding the repatriation tax. Kleinbard calls these “hopscotch” transactions.

Then there is something called “earnings stripping,” which inversion also makes possible. This involves using loans between the foreign “owner” and the American “affiliate” to shift income out of the United States. According to Clausing, Walgreens, which was planning an inversion but pulled back after a public outcry, would have saved “over $780 million in taxes in one year alone.”

For years, executives have called for an overhaul of the corporate tax system; recently, as per Samuels and Bresch, inversions have become a part of the argument. But, in truth, curbing inversions shouldn’t have to wait for wholesale reform. In 2004, George W. Bush pushed through a law that temporarily stopped what was then a flood of inversions.

It can be done again. Laws can be written that, for instance, insist that the foreign targets be much larger companies — thus trying to ensure that the deals are done for strategic reasons rather than solely for tax reasons. And the loopholes that allow for earnings stripping and hopscotching can be closed.

Before that panel discussion on Monday, Treasury Secretary Jack Lew made a speech in which he denounced inversions and essentially pleaded with Congress to take action. He also hinted that the administration might take regulatory action on its own, though there is disagreement among the experts whether regulation alone could stop inversions.

In either case, they need to be stopped. They aren’t just corrosive to the country’s tax base; they are corrosive, in a larger sense, to the country. Thanks to our Swiss cheese of a tax code, multinational companies already have a splendid little deal. They shouldn’t get to sweeten it even more.

Blow and Krugman

September 8, 2014

In “Crime, Bias and Statistics” Mr. Blow says a new report by the Sentencing Project lays bare the systemic effects of racial distortion.  Prof. Krugman says “Scots, What the Heck?” and outlines the very bad economics of independence.  Here’s Mr. Blow:

Discussions of the relationship between blacks and the criminal justice system in this country too often grind to a halt as people slink down into their silos and arm themselves with their best rhetorical weapons — racial bias on one side and statistics in which minorities, particularly blacks, are overrepresented as criminals on the other.

What I find too often overlooked in this war of words is the intersection between the two positions, meaning the degree to which bias informs the statistics and vice versa.

The troubling association — in fact, overassociation — of blacks with criminality directly affects the way we think about both crime and blacks as a whole.

A damning report released by the Sentencing Project last week lays bare the bias and the interconnecting systemic structures that reinforce it and disproportionately affect African-Americans.

This is the kind of report that one really wants to publish in its totality, for its conclusion is such a powerful condemnation of the perversity of racial oppression. But alas, this being a newspaper column, that’s not possible. Still, allow me to present many of their findings:

• “Whites are more punitive than blacks and Hispanics even though they experience less crime.”

• “White Americans overestimate the proportion of crime committed by people of color and associate people of color with criminality. For example, white respondents in a 2010 survey overestimated the actual share of burglaries, illegal drug sales and juvenile crime committed by African-Americans by 20 percent to 30 percent.”

• “White Americans who associate crime with blacks and Latinos are more likely to support punitive policies — including capital punishment and mandatory minimum sentencing — than whites with weaker racial associations of crime.”

This association of crime with blacks has been noted by others. Lisa Bloom, in her book “Suspicion Nation,” points out: “While whites can and do commit a great deal of minor and major crimes, the race as a whole is never tainted by those acts. But when blacks violate the law, all members of the race are considered suspect.”

She further says: “The standard assumption that criminals are black and blacks are criminals is so prevalent that in one study, 60 percent of viewers who viewed a crime story with no picture of the perpetrator falsely recalled seeing one, and of those, 70 percent believed he was African-American. When we think about crime, we ‘see black,’ even when it’s not present at all.”

As the Sentencing Project report makes clear, the entire government and media machinery is complicit in the distortion.

According to the report:

• “Whether acting on their own implicit biases or bowing to political exigency, policy makers have fused crime and race in their policy initiatives and statements. They have crafted harsh sentencing laws that impact all Americans and disproportionately incarcerate people of color.”

• “Many media outlets reinforce the public’s racial misconceptions about crime by presenting African-Americans and Latinos differently than whites — both quantitatively and qualitatively. Television news programs and newspapers overrepresent racial minorities as crime suspects and whites as crime victims.”

• “Disparities in police stops, in prosecutorial charging, and in bail and sentencing decisions reveal that implicit racial bias has penetrated all corners of the criminal justice system.”

The effects of these perceptions and policies have been absolutely devastating for society in general and black people in particular. According to the report:

• “By increasing support for punitive policies, racial perceptions of crime have made sentencing more severe for all Americans. The United States now has the world’s highest imprisonment rate, with one in nine prisoners serving life sentences. Racial perceptions of crime, combined with other factors, have led to the disparate punishment of people of color. Although blacks and Latinos together comprise just 30 percent of the general population, they account for 58 percent of the prison population.”

• “By increasing the scale of criminal sanctions and disproportionately directing penalties toward people of color, racial perceptions of crime have been counterproductive for public safety. Racial minorities’ perceptions of unfairness in the criminal justice system have dampened cooperation with police work and impeded criminal trials. In 2013, over two-thirds of African-Americans saw the criminal justice system as biased against blacks, in contrast to one-quarter of whites. Crime policies that disproportionately target people of color can increase crime rates by concentrating the effects of criminal labeling and collateral consequences on racial minorities and by fostering a sense of legal immunity among whites.”

There is no way in this country to discuss crime statistics without including in that discussion the myriad ways in which those statistics are informed and influenced by the systemic effects of racial distortion.

Individual behavior is not the only component of the numbers; bias is the other.

Mr. Blow is another voice crying in the wilderness.  Here’s Prof. Krugman:

Next week Scotland will hold a referendum on whether to leave the United Kingdom. And polling suggests that support for independence has surged over the past few months, largely because pro-independence campaigners have managed to reduce the “fear factor” — that is, concern about the economic risks of going it alone. At this point the outcome looks like a tossup.

Well, I have a message for the Scots: Be afraid, be very afraid. The risks of going it alone are huge. You may think that Scotland can become another Canada, but it’s all too likely that it would end up becoming Spain without the sunshine.

Comparing Scotland with Canada seems, at first, pretty reasonable. After all, Canada, like Scotland, is a relatively small economy that does most of its trade with a much larger neighbor. Also like Scotland, it is politically to the left of that giant neighbor. And what the Canadian example shows is that this can work. Canada is prosperous, economically stable (although I worry about high household debt and what looks like a major housing bubble) and has successfully pursued policies well to the left of those south of the border: single-payer health insurance, more generous aid to the poor, higher overall taxation.

Does Canada pay any price for independence? Probably. Labor productivity is only about three-quarters as high as it is in the United States, and some of the gap may reflect the small size of the Canadian market (yes, we have a free-trade agreement, but a lot of evidence shows that borders discourage trade all the same). Still, you can argue that Canada is doing O.K.

But Canada has its own currency, which means that its government can’t run out of money, that it can bail out its own banks if necessary, and more. An independent Scotland wouldn’t. And that makes a huge difference.

Could Scotland have its own currency? Maybe, although Scotland’s economy is even more tightly integrated with that of the rest of Britain than Canada’s is with the United States, so that trying to maintain a separate currency would be hard. It’s a moot point, however: The Scottish independence movement has been very clear that it intends to keep the pound as the national currency. And the combination of political independence with a shared currency is a recipe for disaster. Which is where the cautionary tale of Spain comes in.

If Spain and the other countries that gave up their own currencies to adopt the euro were part of a true federal system, with shared institutions of government, the recent economic history of Spain would have looked a lot like that of Florida. Both economies experienced a huge housing boom between 2000 and 2007. Both saw that boom turn into a spectacular bust. Both suffered a sharp downturn as a result of that bust. In both places the slump meant a plunge in tax receipts and a surge in spending on unemployment benefits and other forms of aid.

Then, however, the paths diverged. In Florida’s case, most of the fiscal burden of the slump fell not on the local government but on Washington, which continued to pay for the state’s Social Security and Medicare benefits, as well as for much of the increased aid to the unemployed. There were large losses on housing loans, and many Florida banks failed, but many of the losses fell on federal lending agencies, while bank depositors were protected by federal insurance. You get the picture. In effect, Florida received large-scale aid in its time of distress.

Spain, by contrast, bore all the costs of the housing bust on its own. The result was a fiscal crisis, made much worse by fears of a banking crisis that the Spanish government would be unable to manage, because it might literally run out of cash. Spanish borrowing costs soared, and the government was forced into brutal austerity measures. The result was a horrific depression — including youth unemployment above 50 percent — from which Spain has barely begun to recover.

And it wasn’t just Spain, it was all of southern Europe and more. Even euro-area countries with sound finances, like Finland and the Netherlands, have suffered deep and prolonged slumps.

In short, everything that has happened in Europe since 2009 or so has demonstrated that sharing a currency without sharing a government is very dangerous. In economics jargon, fiscal and banking integration are essential elements of an optimum currency area. And an independent Scotland using Britain’s pound would be in even worse shape than euro countries, which at least have some say in how the European Central Bank is run.

I find it mind-boggling that Scotland would consider going down this path after all that has happened in the last few years. If Scottish voters really believe that it’s safe to become a country without a currency, they have been badly misled.

Krugman’s blog, 9/6/14

September 7, 2014

There was one post yesterday, “A Note on the Dynamics of Misinformation:”

Very busy, so no substantive posting today. But I did want to share a thought from the past few days. I posted about the surprisingly good news, at least so far, on Obamacare premiums for 2015 — and as usual was met with a wall of rage from the right. The idea that this thing might be working inspires a level of anger nothing else (except maybe climate science) matches.

No news there. Nor is it news that such people know things that ain’t so. But there’s something I’ve noticed from the combination of reactions to what I write and researching past coverage of Obamacare. It goes like this: a lot of the untrue beliefs people have about Obamacare come not so much from outright false reporting as from selective reporting. Every suggestion of bad news gets highlighted — especially, of course, but not only by Fox, the WSJ, etc.. But when it turns out that the news wasn’t really that bad, these sources just move on. There are claims that millions of people are losing coverage — headlines! When it turns out not to be true — crickets! Some experts claim that premiums will rise by double digits — big news! Actual premium numbers come in and they’re surprisingly low — not mentioned.

The result is that most news consumers — who form impressions rather than trying to work out details — have the sense that it’s been all bad news. This is true even for people who don’t rely on Fox — I get asked about the scary premium hikes by people on the Upper West Side! And of course for those who do get their news from Fox, well, they know, just know, that Obamacare has reduced the number of Americans with insurance and caused premiums to double or something, even though even their favorite news source isn’t saying such things.

We need a term for beliefs based on reports that have been superseded; maybe fossils instead of zombies. Anyway, it’s striking.

The Pasty Little Putz, Dowd, Friedman, Kristof and Bruni

September 7, 2014

In “Rape and Rotherham” Putzy ‘splains that the grim story shows how exploitation can flourish in different cultural contexts, and how insufficient any set of pieties can be to its restraint.  In the comments “gemli” from Boston points out that “there is not a tale so sordid that Douthat can’t use it to shift focus from the evils perpetrated by the Catholic Church. In this installment, he’s admitting wrongdoing by Catholic priests and the subsequent cover-up by the conservative hierarchy only to draw a false equivalence between that and his favorite target of late, liberal multiculturalism.”  MoDo has a question:  “Is It World War III or Just Twitter?”  She hisses that President Obama blames social media for our knowing just how messy the world is.  Sure he does, MoDo, sure he does.  And I’m the Czarina of all the Russias.  The Moustache of Wisdom also has a question in “Leading From Within.”  He asks what’s the best way for the United States to address both ISIS and Vladimir Putin at once?  Mr. Kristof, in “When Whites Just Don’t Get It, Part 2,” says a column on “smug white delusion” drew a deluge of responses. He gives us a few.  Mr. Bruni says we should be “Demanding More From College.”  He says in a world of many separate camps, college can and should be a bridge.  Here, FSM help us, is the Putz:

There are enough grim tidings from around the world that the news from Rotherham, a faded English industrial town where about 1,400 girls, mostly white and working class, were raped by gangs of Pakistani men while the local authorities basically shrugged and did nothing, is already slipping out of American headlines.

But we should remain with Rotherham for a moment, and give its story a suitable place of dishonor in the waking nightmare that is late summer 2014.

We should do so not just for the sake of the victims, though for their sake attention should be paid: to the girls gang-raped or doused with gasoline; to the girls assaulted in bus stations and alleyways; to the girl, not yet 14, who brought bags of soiled clothes as evidence to the police and earned nothing for her trouble save for a check for 140 pounds — recompense for the garments, which the cops somehow managed to misplace.

But bearing witness is insufficient; lessons must be learned as well. This is more than just a horror story. It’s a case study in how exploitation can flourish in different cultural contexts, and how insufficient any set of pieties can be to its restraint.

Interpreted crudely, what happened in Rotherham looks like an ideological mirror image of Roman Catholicism’s sex abuse scandal. The Catholic crisis seemed to vindicate a progressive critique of traditionalism: Here were the wages of blind faith and sexual repression; here was a case study in how a culture of hierarchy and obedience gave criminals free rein.

The crimes in Rotherham, by contrast, seem scripted to vindicate a reactionary critique of liberal multiculturalism: Here are immigrant gangs exploiting a foolish Western tolerance; here are authorities too committed to “diversity” to react appropriately; here is a liberal society so open-minded that both its brain and conscience have fallen out.

A more subtle reading, though, reveals commonalities between the two scandals. The rate of priestly abuse was often at its worst in places and eras (the 1970s, above all) where traditional attitudes overlapped with a sudden wave of liberation — where deference to church authority by parents and police coexisted with a sense of moral upheaval around sexuality and sexual ethics, both within seminaries and in society at large. (John Patrick Shanley’s famous play “Doubt,” in which a hip, with-it, Kennedy-era priest relies on clericalism to evade accusations of abuse, remains the best dramatization of this tangle.)

In a somewhat similar way, what happened in Rotherham was rooted both in left-wing multiculturalism and in much more old-fashioned prejudices about race and sex and class. The local bureaucracy was, indeed, too fearful of being labeled “racist,” too unwilling, as a former member of Parliament put it, to “rock the multicultural community boat.” But the rapes also went unpunished because of racially inflected misogyny among police officers, who seemed to think that white girls exploited by immigrant men were “tarts” who deserved roughly what they got.

The crucial issue in both scandals isn’t some problem that’s exclusive to traditionalism or progressivism. Rather, it’s the protean nature of power and exploitation, and the way that very different forms of willful blindness can combine to frustrate justice.

So instead of looking for ideological vindication in these stories, it’s better to draw a general lesson. Show me what a culture values, prizes, puts on a pedestal, and I’ll tell you who is likely to get away with rape.

In Catholic Boston or Catholic Ireland, that meant men robed in the vestments of the church.

In Joe Paterno’s pigskin-mad Happy Valley, it meant a beloved football coach.

In status-conscious, education-obsessed Manhattan, it meant charismatic teachers at an elite private school.

In Hollywood and the wider culture industry — still the great undiscovered country of sexual exploitation, I suspect — it has often meant the famous and talented, from Roman Polanski to the BBC’s Jimmy Savile, robed in the authority of their celebrity and art.

And in Rotherham, it meant men whose ethnic and religious background made them seem politically untouchable, and whose victims belonged to a class that both liberal and conservative elements in British society regard with condescension or contempt.

The point is that as a society changes, as what’s held sacred and who’s empowered shifts, so do the paths through which evil enters in, the prejudices and blind spots it exploits.

So don’t expect tomorrow’s predators to look like yesterday’s. Don’t expect them to look like the figures your ideology or philosophy or faith would lead you to associate with exploitation.

Expect them, instead, to look like the people whom you yourself would be most likely to respect, most afraid to challenge publicly, or least eager to vilify and hate.

Because your assumptions and pieties are evil’s best opportunity, and your conventional wisdom is what’s most likely to condemn victims to their fate.

I really wish the Times would move him back to Monday, a day that sucks already.   Why ruin Sunday?  Next up we have MoDo’s ravings, replete with using fictional characters as straw men:

Shockingly, in the end, I didn’t miss Brody.

I was perfectly happy with The Drone Queen, as Claire Danes’s Carrie Mathison is christened on her birthday cake in the first episode of Showtime’s “Homeland,” returning next month.

I gingerly went to a screening in New York, assuming that, without my favorite ginger, my interest would wane. But the show, set in Kabul and Islamabad, where Carrie is now working for the C.I.A. directing “playtime,” as they call drone strikes, having dumped her ginger baby with her sister back home, crystallizes America’s Gordian knot in the Middle East. It vividly shows our fungible moral choices and the disruptive power of social media.

So many gigantic blunders have been made since 9/11, so many historical fault lines have erupted, that no matter which path the Obama administration takes, it runs into a “No Exit” sign. Any choice seems like a bad choice.

Mandy Patinkin’s Saul Berenson, now working for a defense contractor in New York, warns a group of military officers that America is walking away from Afghanistan “with the job half-done.”

He stands up to his boss, who is upset by his impolitic behavior, asking if “we really want to risk going back” to “girls not allowed in school, roving gangs of men with whips enforcing Sharia law, a safe haven again for Al Qaeda”?

When Carrie oversees an airstrike in Pakistan to take out the No. 4 terrorist target on the kill list, the bombs incinerate innocents at a wedding. Afterward, the Air Force pilot who conducted the strike confronts Carrie in a bar and calls her a monster. When Rupert Friend’s haunted C.I.A. assassin Peter Quinn asks Carrie if she’s ever bothered by dropping fire on a hydra-headed kill list, sometimes with tragic mistakes, she rolls her eyes and replies, “It’s a job.”

Carrie at first contends that they’re “bulletproof,” that no one will find out about what she calls “collateral damage” because the strike was in a tribal region. But then a medical school student, angry that his friend’s mother and sister were killed at the wedding, posts a cellphone video of the gory scene.

The murderous melee that ensues is redolent of President Obama’s provocative remark at a Democratic Party fund-raiser in New York, talking about the alarming aggressions flaring up around the world and alluding to the sulfurous videos of the social-media savvy ISIS fiends beheading American journalists.

“If you watch the nightly news,” the president said, “it feels like the world is falling apart.”

Trying to reassure Americans who feel frightened and helpless, he posited that “the truth of the matter is that the world has always been messy. In part, we’re just noticing now because of social media and our capacity to see in intimate detail the hardships that people are going through.”

“I think he’s trying to blame the messenger,” said Terry McCarthy, the president of the Los Angeles World Affairs Council. “Whether or not James Foley’s brutal beheading was shown on YouTube or disseminated on Twitter doesn’t affect the horror of what was done, and in another era, it would have been just as shocking, even if reported only on network TV or radio or in a newspaper.

“I think it is also condescending to say we are just noticing now because of social media. How about the recoil at the news of the My Lai massacre, broken by Sy Hersh on a newswire? Or the Abu Ghraib pictures run on ‘60 Minutes II’ and in The New Yorker?

“ISIS beheading American journalists, crucifying people, stoning a man to death in Mosul, targeting minorities for genocide, is not simply ‘messy as always’ — are you kidding me? It is an outright abomination in the face of humanity, however and through whatever media it is reported and it needs our, and our allies’, most urgent attention.”

Richard Haass, president of the Council on Foreign Relations, noted that the impact of social media was exaggerated during the Arab Spring, leading to the mistaken belief that liberal secularists in Tahrir Square and other places posed a serious alternative to authoritarian regimes or radical Islamists.

The world is more disorderly for all kinds of reasons, he said, including the loss of confidence in American reliability and the American model, and reactions to things the United States has done, like the Iraq war, or not done, like acting on chemical weapons use in Syria.

“But to blame it on social media,” Haass said, “is something of a cop-out.”

He contended that while the sky may not be falling, “it certainly is lower,” and to deny that “is to engage in denial. We need to be very careful lest people begin to conclude that Americans are disinterested in the world. We don’t want that narrative to take hold.”

Margaret MacMillan, an Oxford historian who wrote “Paris 1919” and “The War That Ended Peace: The Road to 1914,” says the president is right that we probably are more aware of what’s going on around the world, even with all the “rubbish” on the web, but she also believes that, from voracious Putin to vicious jihadists, “sometimes we’re right to be scared.”

She predicted that instead of World War III, “The 21st century will be a series of low grade, very nasty wars that will go on and on without clear outcomes, doing dreadful things to any civilians in their paths.”

Certainly, Obama never complained about a frenzied social media when it served his political purposes.

The president’s observation unfortunately underscored his role as Barack Seneca Obama, his air of disconnection, his “we don’t have a strategy” vagueness on engagement, his belief that extreme excitement, outrage and sentimentality are suspect.

His “bucket list” visit Friday to the alien-looking Stonehenge was the perfect backdrop for his strange pattern of detachment, and his adamantine belief that his Solomonic wisdom and Spocky calm help him resist the siren songs to disaster.

Joe Biden was the one connecting with Americans, promising to chase the ISIS savages “to the gates of hell,” while Obama’s subliminal, or not so subliminal, message was that before certain atrocities, the heart must muzzle itself, rejecting flights of anxiety, worry and horror as enemies of lucid analysis.

In some situations, panic is a sign of clear thinking. Reality is reality, whether it’s tweeted or not. And the truth doesn’t always set you free. The mind and the will don’t always act in concert. You can know a lot of things and still not act. And as we saw with the Iraq invasion, you can not know a lot of things and still act.

Bill Clinton couldn’t stop biting his lip. Now we’d kill to see Obama baring his teeth.

Just had to say “kill” didn’t you…  Typical Dowd crap.  Next up we’re facing The Moustache of Wisdom:

I don’t know what action will be sufficient to roll back both the Islamic State of Iraq and Syria, or ISIS, and Russia’s president, Vladimir Putin, but I do know what’s necessary. And it’s not “leading from behind,” which didn’t really work for President Obama in Libya, and it isn’t simply leading a lonely and unpopular charge from in front, which certainly didn’t work for President Bush in Iraq. It’s actually reviving America’s greatest strategy: leading from within.

The most effective leadership abroad starts with respect earned from others seeing us commit to doing great and difficult things at home that summon the energy of the whole country — and not just from our military families. That is how America inspires others to action. And the necessary impactful thing that America should do at home now is for the president and Congress to lift our self-imposed ban on U.S. oil exports, which would significantly dent the global high price of crude oil. And combine that with long overdue comprehensive tax reform that finally values our environment and security. That would be a carbon tax that is completely offset by lowering personal income, payroll and corporate taxes. Nothing would make us stronger and Putin and ISIS weaker — all at the same time.

How so? First you need to understand how much Putin and ISIS have in common. For starters, they each like to do their dirtiest work wearing a mask, because deep down, somewhere, they know that what they’re doing is shameful. The ISIS executioner actually wears a hood. Putin lies through his poker face.

Both seem to know that their ideas or influence are unsellable on their merits, so they have to impose them with intimidating force — “convert to puritanical Islam or I will chop your head off,” says ISIS, and “submit to Russia’s sphere of influence or I will invade you and wipe out your regime,” says Putin.

Both are clearly motivated to use force by an intense desire to overcome past humiliations. For Putin, it is the humiliation over Russian weakness that followed the breakup of the Soviet Union in 1991, which he once described as “the greatest geopolitical catastrophe” of the 20th century, which left millions of Russian speakers outside the Russian state. And for ISIS, it is how modernity has left so many Arab/Muslim nations behind in the 21st century by all the critical indices of human development: education, economic growth, scientific discoveries, literacy, freedom and women’s empowerment. Preventing Ukrainians from exercising their free will is Putin’s way of showing Russia’s only real strength left: brute force. Beheading defenseless American journalists is ISIS’s way of saying it is as strong as the United States. Both are looking for respect in all the wrong places.

Both Putin and ISIS are also intent on recreating states from an overglorified past to distract their peoples from their inability to build real economies — ISIS calls its recreation the “caliphate” and Putin calls his “Novorossiya,” or New Russia (or Ukraine’s Russian-speaking southeast). Both are also intent on rewriting the prevailing rules of the international system, which they see as having been drawn up by America or the West to advantage themselves and disadvantage Arabs or Russians. And, very significantly, they both are totally dependent on exploiting high-priced oil or gas to finance their madness.

The way you defeat such an enemy is by being “crazy like a fox,” says Andy Karsner, the former assistant energy secretary in the last Bush administration and now the C.E.O. of Manifest Energy. “We have one bullet that hits both of them: bring down the price of oil. It’s not like they can suddenly shift to making iWatches.” We are generating more oil and gas than ever, added Karsner, and it’s a global market. Absurdly, he said, the U.S. government bans the export of our crude oil. “It’s as if we own the world’s biggest bank vault but misplaced the key,” added Karsner. “Let’s lift that export ban and have America shaping the market price in our own interest.”

But that must be accompanied by tax reform that puts a predictable premium on carbon, ensuring that we unite to consistently invest in clean energies that take us beyond fossil fuels, increase efficiency and address climate change. Draining our enemies’ coffers, enhancing security, taxing environmental degradation — what’s not to like? And if we shift tax revenue to money collected from a carbon tax, we can slash income, payroll and corporate taxes, incentivize investment and hiring and unleash our economic competitiveness. That is a strategy hawks and doves, greens and big oil could all support.

If the price of oil plummets to just $75 to $85 a barrel from $100 by lifting the ban, and we have implemented tax reform that signals our commitment to clean growth, we inevitably weaken Putin and ISIS, strengthen America and show the world that we deserve to lead because we’re back to doing big, hard things at home that once again differentiate us — not just bombing in distant lands and pretending that’s getting the job done.

Wouldn’t it be refreshing, asked Karsner, if we showed up at the global poker table, across from Putin and ISIS,  “holding four aces, instead of just bluffing with a pair of 2’s?”

Now we get to Mr. Kristof:

In my column a week ago, “When Whites Just Don’t Get It,” I took aim at what I called “smug white delusion” about race relations in America, and readers promptly fired back at what they perceived as a smugly deluded columnist.

Readers grudgingly accepted the grim statistics I cited — such as the wealth disparity between blacks and whites in America today exceeding what it was in South Africa during apartheid — but many readers put the blame on African-Americans themselves.

“Probably has something to do with their unwillingness to work,” Nils tweeted.

Nancy protested on my Facebook page: “We can’t fix their problems. It’s up to every black individual to stop the cycle of fatherless homes, stop the cycle of generations on welfare.”

There was a deluge of such comments, some toxic, but let me try to address three principal arguments that I think prop up white delusion.

First, if blacks are poor or in prison, it’s all their fault. “Blacks don’t get it,” Bruce tweeted. “Choosing to be cool vs. getting good grades is a bad choice. We all start from 0.”

Huh? Does anybody really think that we all take off from the same starting line?

Slavery and post-slavery oppression left a legacy of broken families, poverty, racism, hopelessness and internalized self-doubt. Some responded to discrimination and lack of opportunity by behaving in self-destructive ways.

One study found that African-American children on welfare heard only 29 percent as many words in their first few years as children of professional parents. Those kids never catch up, partly because they’re more likely to attend broken schools. Sure, some make bad choices, but they’ve often been on a trajectory toward failure from the time they were babies.

These are whirlpools that are difficult to escape, especially when society is suspicious and unsympathetic. Japan has a stigmatized minority group, the burakumin, whose members once held jobs considered unclean. But although this is an occupational minority rather than a racial one, it spawned an underclass that was tormented by crime, educational failure, and substance abuse similar to that of the American underclass.

So instead of pointing fingers, let’s adopt some of the programs that I’ve cited with robust evidence showing that they bridge the chasm.

But look at Asians, Mark protests on my Google Plus page: Vietnamese arrived in poverty — and are now school valedictorians. Why can’t blacks be like that?

There are plenty of black valedictorians. But bravo to Asians and other immigrant groups for thriving in America with a strong cultural emphasis on education, diligence and delay of self-gratification. We should support programs with a good record of inculcating such values in disadvantaged children. But we also need to understand that many young people of color see no hope of getting ahead, and that despair can be self-fulfilling.

A successful person can say: “I worked hard in school. I got a job. The system worked.” Good for you. But you probably also owe your success to parents who read to you, to decent schools, to social expectations that you would end up in college rather than prison. So count your blessings for winning the lottery of birth — and think about mentoring a kid who didn’t.

Look, the basic reason young black men are regarded with suspicion is that they’re disproportionately criminals. The root problem isn’t racism. It’s criminality.

It’s true that blacks accounted for 55 percent of robbery arrests in 2012, according to F.B.I. statistics. But, by my calculations, it’s also true that 99.9 percent of blacks were not arrested and charged with robbery in 2012, yet they are still tarred by this pernicious stereotype.

Criminality is real. So is inequity. So is stereotyping.

The United States Sentencing Commission concluded that black men get sentences one-fifth longer than white men for committing the same crimes. In Louisiana, a study found that a person is 97 percent more likely to be sentenced to death for murdering a white person than a black person.

Mass incarceration means that the United States imprisons a higher proportion of its black population than apartheid South Africa did, further breaking up families. And careful studies find that employers are less likely to respond to a job inquiry and résumé when a typically black name is on it.

Society creates opportunity and resiliency for middle-class white boys who make mistakes; it is unforgiving of low-income black boys.

Of course, we need to promote personal responsibility. But there is plenty of fault to go around, and too many whites are obsessed with cultivating personal responsibility in the black community while refusing to accept any responsibility themselves for a system that manifestly does not provide equal opportunity.

Yes, young black men need to take personal responsibility. And so does white America.

Last but not least we get to Mr. Bruni:

I’m beginning to think that college exists mainly so we can debate and deconstruct it.

What’s its rightful mission? How has it changed? Is it sufficiently accessible? Invariably worthwhile?

As the fall semester commenced, the questions resumed. Robert Reich, the country’s labor secretary during the Clinton administration, issued such a pointed, provocative critique of the expense and usefulness of a traditional liberal arts degree that Salon slapped this headline on it: “College is a ludicrous waste of money.”

Meanwhile, the sociologists Richard Arum and Josipa Roksa were out with a new book, “Aspiring Adults Adrift,” in which they assessed how a diverse group of nearly 1,000 recent graduates were faring two years after they finished their undergraduate studies. About one-quarter of them were still living at home. And nearly three-quarters were still getting at least some money from parents. These were the nuggets that the media understandably grabbed hold of, drawing the lesson that college isn’t the springboard that young men and women want and perhaps need it to be.

I have a problem with all of this. But my concern isn’t about the arguments themselves or some of the conclusions drawn. It’s about the narrowness of the discussion, which so heavily emphasizes how a career is successfully forged and how financial security is quickly achieved.

While those goals are important and that focus is understandable, there’s another dimension to college, and it’s one in which students aren’t being served, or serving themselves, especially well. I’m referring to the potential — and need — for college to confront and change political and social aspects of American life that are as troubling as the economy.

We live in a country of sharpening divisions, pronounced tribalism, corrosive polarization. And I wish we would nudge kids — no, I wish we would push them — to use college as an exception and a retort to that, as a pre-emptive strike against it, as a staging ground for behaving and living in a different, broader, healthier way.

As we pepper students with contradictory information and competing philosophies about college’s role as an on ramp to professional glory, we should talk as much about the way college can establish patterns of reading, thinking and interacting that buck the current tendency among Americans to tuck themselves into enclaves of confederates with the same politics, the same cultural tastes, the same incomes. That tendency fuels the little and big misunderstandings that are driving us apart. It’s at the very root of our sclerotic, dysfunctional political process.

And college is the perfect chapter for diversifying friends and influences, rummaging around in fresh perspectives, bridging divides. For many students, it’s an environment more populous than high school was, with more directions in which to turn. It gives them more agency over their calendars and their allegiances. They can better construct their world from scratch.

And the clay hasn’t dried on who they are. They’re not yet set in their ways.

But too many kids get to college and try instantly to collapse it, to make it as comfortable and recognizable as possible. They replicate the friends and friendships they’ve previously enjoyed. They join groups that perpetuate their high-school experiences.

Concerned with establishing a “network,” they seek out peers with aspirations identical to their own. In doing so, they frequently default to a clannishness that too easily becomes a lifelong habit.

If you spend any time on college campuses, you’ll notice this, and maybe something else as well: Many students have a much more significant depth than breadth of knowledge. They know tons about what they’re interested in, because they’ve burrowed, with the Internet’s help, into their passions. But burrows are small and often suffocating, and there are wide spaces between them. You’re in yours; I’m in mine. Where’s the common ground?

The Internet has proved to be one of the great ironies of modern life. It opens up an infinite universe for exploration, but people use it to stand still, in a favorite spot, bookmarking the websites that cater to their existing hobbies (and established hobbyhorses) and customizing their social media feeds so that their judgments are constantly reinforced, their opinions forever affirmed.

A report published late last month by the Pew Research Center documented this. Summarizing it in The Times, Claire Cain Miller wrote, “The Internet, it seems, is contributing to the polarization of America, as people surround themselves with people who think like them and hesitate to say anything different.”

College is precisely the time not to succumb to that. Every student orientation should include the following instructions: Open your laptops. Delete at least one of every four bookmarks. Replace it with something entirely different, maybe even antithetical. Go to Twitter, Facebook and such, and start following or connecting with publications, blogs and people whose views diverge from your own. Mix it up.

That’s also how students should approach classes and navigate their social lives, because they’re attending college in the context not only of a country with profound financial anxieties, but of a country with homogeneous neighborhoods, a scary preoccupation with status and microclimates of privilege. Just as they should be girding themselves for a tough job market, they should be challenging the so-called sorting that’s also holding America back.

Arum and Roksa, in “Aspiring Adults Adrift,” do take note of upsetting patterns outside the classroom and independent of career preparation; they cite survey data that showed that more than 30 percent of college graduates read online or print newspapers only “monthly or never” and nearly 40 percent discuss public affairs only “monthly or never.”

Arum said that that’s “a much greater challenge to our society” than college graduates’ problems in the labor market. “If college graduates are no longer reading the newspaper, keeping up with the news, talking about politics and public affairs — how do you have a democratic society moving forward?” he asked me.

Now more than ever, college needs to be an expansive adventure, yanking students toward unfamiliar horizons and untested identities rather than indulging and flattering who and where they already are. And students need to insist on that, taking control of all facets of their college experience and making it as eclectic as possible.

It could mean a better future — for all of us. And there’s no debate that college should be a path to that.


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