Just Saying We’re Great Doesn’t Make It So ( The Baseline Scenario )
2/18/2016
By James Kwak
David Brooks has competition for the title of most inane New York Times columnist. I generally never read anything by Thomas Friedman—I gave up less than one hundred pages of The World Is Flat because of his blissfully uninformed discussion of workflow software—but I made an exception today because of this brilliant tweet by Benjamin Kunkel:
http://twitter.com/das_kunk/status/700305233247866881/photo/1
I mean, I co-founded a company, and it’s not as if we had a secret laboratory churning out clones to work for us. One reason we founded the company when we did—2001, after the collapse of the technology bubble—was that we knew there were many talented people out there looking for a satisfying and challenging place to work. (One of the things I’m most proud of is that that, fourteen years later, my old company is still one of the best places to work in the economy.) In other words, skilled and motivated people (most of whom already have jobs) are a precondition for entrepreneurialism.
I assume Friedman’s point is that to have new jobs, you have to have people willing to take risks and start businesses. Of course, this isn’t completely accurate, since big companies often keep getting bigger and hiring new people. But I agree with the general point that entrepreneurial activity is a good thing. However, Friedman presents as undisputed fact this quotation from a report:
With enough hard work anyone can use entrepreneurship to pave their own way to prosperity and strengthen their communities by creating jobs and growing their local economy.
Does Thomas Friedman really think that literally anyone can become rich just by working hard and “using entrepreneurship”? Anyone?
Friedman’s column only compounds the vapidity in other ways. He criticizes Bernie Sanders for “bleating about breaking up the big banks.” Here is Friedman’s basis for his position:
Wall Street excesses helped tank the economy in 2008. But thanks to the Dodd-Frank Wall Street Reform and Consumer Protection Act, that can’t easily happen again.
Huh? We passed Dodd-Frank, and now everything is solved?
Friedman blames both parties for tolerating illegal immigration, or at least that’s the only way I can interpret this sentence:
It’s an outrage that we can’t control our border, but both parties have been complicit — Democrats because they saw new voters coming across and Republicans because they saw cheap labor coming across.
He thinks that Democrats welcome illegal immigrants because we want their votes? (If he’s talking about waiting for the “anchor babies” to grow up and vote, that’s more foresight than I give any party credit for.)
But the most baffling thing is Friedman’s unthinking faith in the “quality of our governing institutions.” He particularly has it in for Ted Cruz and his “trashing of Washington, D.C.,” but Sanders and Trump also make a big deal about how the political system is broken. The idea that we have the best political institutions in the world is a touching example of that curious American belief that, because we’re America, we must have the best of everything that matters.
Friedman contrasts federal government agencies with those in Russia and China. Well, OK. But what about Western Europe, Scandinavia, Australia, and Japan, among others? There are plenty of countries with democratic institutions, high standards of living, and relatively satisfied citizens. Some of them could even be characterized as social-democratic, like Denmark, #3 in the World Bank’s rankings for ease of doing business.
Looking at Washington today (or Lansing, Michigan), is it really clear that our institutions are really even average among prosperous countries? On the input side, think about the influence of money in politics; the domination of state politics by, in some cases, a single person; or, to take one example, the fact that we are actually having a fight about whether a sitting president can nominate someone to an empty Supreme Court seat. On the output side, think about the facts that we started a major war on the basis of a mountain of lies, we have the highest incarceration rates in the developed world, and we are singularly unable to do anything about climate change (even by comparison with Western Europe, which isn’t doing much).
In the long run of history, we probably have had pretty good political institutions, and that probably was a major reason for our tremendous growth in material prosperity through the nineteenth century and most of the twentieth century. But over the past forty years we have seen rising inequality, stagnant wages for the middle class, the emergence of the political superdonor, and the increasing separation of politicians’ priorities from the concerns of ordinary people (see Gilens and Page 2014). These are not trends to be proud of. As Daron Acemoglu and James Robinson have described, the monopolization of political power by a narrow elite can lead to economic stagnation.
Instead of blindly asserting that our governing institutions are the best because I Am America (And So Can You!), we need to recognize that something really is broken. Ted Cruz and I may disagree on how to fix it—I’m with Larry Lessig—but the first step in solving anything is realizing that you have a problem. Thomas Friedman doesn’t. Most Americans seem to think we do.
http://baselinescenario.com/2016/02/18/just-saying-were-great-doesnt-make-it-so/
