Romney Attacked Trump – Called Him “Phony, A Fraud”

WASHINGTON – If you are a convinced Donald Trump supporter, Mitt Romney’s scathing personal attack against the Republican front-runner will not mean anything. For the Trump true believers it is a given that the “Republican Establishment” fears the New York billionaire, and so that they will do whatever they can to stop him from becoming the party nominee.

Romney’s attacks Trump  

Let’s put this in perspective. Mitt Romney was the 2012 Republican presidential candidate. Although he lost to Barack Obama, for some time he was the national leader of the Republican Party. So, at least some people will listen to what he says on issues of Republican Party national politics in a decisive election year.

And now Romney, using surprisingly strong language, called Donald Trump “a phony, a fraud”. He stated that “dishonesty is Trump’s hallmark”. And he added that “his promises are as worthless as a degree from Trump University” , (a clear reference to the higher education institution created by Trump that is now being sued by former students who claim the whole thing was a scam). Beyond attacking Trump’s character and morality, Romney clearly stated that Trump’s policies would lead America to economic and foreign policy disasters.

Does this make any difference? 

In his speech, Romney pointed out that this race is not over. There is still a good chance to stop Trump. There are other candidates in the race. Trump, while ahead in the delegates count, has not amassed a prohibitive lead. He can be beaten.

Alright, Romney delivered his broadside. But will the Republican Party members who are about to vote in the upcoming –and indeed decisive– primaries really listen? Or is this a wasted effort on the part of a man who after all was defeated back in 2012, and has since practically disappeared from the national political scene?

Well, there is a good chance that at least voters paid attention to Romney’s warnings. True enough, Trump has a hard-core of adoring supporters who will be behind him, no matter what Romney or anybody else, will say about him.

More than half of the Republican voters not with Trump 

But the record shows that in the primaries held so far about 2/3 of the voters are not with Trump. Worse yet for Trump, many among the non-Trump voters have proclaimed that they will never vote for him, even if he is the official Republican nominee. 

In other words, while Trump’s support may go up some from 35%, he faces serious difficulties in getting enough votes to  secure the nomination. If his opponents are more organized, they can make sure that Trump’ support stays at 35%, or below that. 

Energize the anti-Trump voters 

Obviously, with his speech Romney tried to energize the non-Trump, or anti-Trump, camp. He wanted to convince millions of Republicans who are hesitating that this contest for the party nomination is far from over.

Well, who knows how all this will play out. Sadly, the other three contenders for the GOP nomination, Ted Cruz, Marco Rubio, and John Kasich are either mediocre candidates, (Cruz and Rubio), or bad campaigners (Kasich).

While Trump is certainly not polished when it comes to articulating credible policy positions, he is not facing a formidable opposition. (This in part explains his surprising success).

Something  will happen 

Still, it is quite possible that something will happen. Romney’s open frontal attack against Trump will have ripple effects. Others will join the anti-Trump coalition. Yes, this means donors, and millions of dollars of PAC money going to fund anti-Trump TV ads. Of course, all this also means creating a civil war within the Republican party. This fight will get really ugly.

Slow down Trump 

But the net effect will probably be to slow down the Trump Express. If in the upcoming primaries Trump does reasonably well; but not well enough to secure the number of delegates that will guarantee his nomination prior to the Convention, then his claim to be the anointed Republican leader is voided.

Based on results so far, this scenario is quite possible. Note that In Virginia, as well as other states, most late deciders, primaries voters who made up their minds at the last minute, opted for someone other than Trump.

Therefore, Romney’s scathing attack may very well sway many among the millions of undecided who are about to vote in many more primaries in the next couple of weeks. Here is Romney’s simple message:“”Fellow Republicans, whatever you decide, do not vote for Trump”. 

Everything is possible 

In the end, if Trump gets to the Republican Convention without the pledged 1,237 delegates he needs to seal the nomination, almost everything is possible. After the first ballot, all delegates are released from their pledge, and free to vote as they please. Who knows what may happen. Yes, this war within the Republican Party is going to get a lot worse.

However, for Mitt Romney and many others, avoiding the prospect of Trump as the official candidate of the Republican Party is worth the ugliest of fights.




The Republicans Must Support Immigration Reform

WASHINGTON – Democratic presidential candidate Hillary Clinton made news by saying that, as president, she would go beyond what Obama has done to grant a reprieve to millions of illegal immigrants.

Obama’s executive order

As we know, President Obama used his executive authority to grant “de facto” amnesty to millions of (mostly Latino) illegal immigrants. He claimed, that he could do this on the basis of “prosecutorial discretion”, the accepted principle that allows judicial authorities not to pursue certain crimes.

Well, this was a stretch. “Prosecutorial discretion” is not infrequent; but it is understood that it will be applied to individual cases, and not to millions of law-breakers.

Obama’s executive order was and is controversial. In fact, the matter is currently under judicial review. Given this context, it is not clear what Hillary Clinton meant when she said that she is prepared to go even further. Does she think that any president could do more unilaterally (that is without any new legislation passed by Congress) than what Obama did at the end of 2014?

Hillary Clinton supports legalization

Who knows really. But what we do know is that along with this statement Mrs. Clinton has also openly declared her support for a process that would eventually lead to the legalization of about 11 to 12 million illegal immigrants currently living in the USA.

Whatever the legal debate on the limits of presidential authority in addressing this issue, Hillary Clinton is now clearly on the side of those who advocate amnesty, or something close to it, with or without new laws.

Democrats want Latino votes

May be this is no surprise. She is a Democrat. All Democrats usually court minority voters. As the Hispanic population keeps growing, the Latino vote is getting more and more significant. Therefore, embracing immigration reforms looks politically smart.

Stupid ideas

The crowded field of Republicans aspiring to the nomination should take notice. It would be most unfortunate if the Republican candidates for the Republican nomination would display the same level of obtuse idiocy on immigration that we saw in 2012. To keep proclaiming that they support “self-deportation”, (this was Mitt Romney’s brilliant idea), and that we should just “enforce the laws” and get busy deporting 11 or 12 million people is fantastically stupid, not to mention totally impractical.

To be clear on this, I support legal immigration and safe borders going forward. But we have to deal with the mess that has been created by decades of poor enforcement. There are millions of illegal immigrants who have been in America for decades.

Do we really want to uproot all of them and kick them out? Has anybody thought about the horrible consequences for the people themselves, their families, (many of them have children who are US citizens because they were born here), their finances, and what not? Do we really think that millions of people who have built their lives here in America can be just “sent back”, just as mislabeled FedEx packages to be returned to sender? Are we that crazy?

Strike a balance

I fully understand that serious immigration reform has to be done well. We certainly do not want new laws creating the impression that illegal immigration will be tolerated in the future. We do not want to create the impression that every now and then we shall have another amnesty that will legalize all those who are already here. However, it would be good for America to resolve this mess of millions of people who live here, but in some sort of twilight because of their illegal status.

Hillary Clinton has told America where she stands. Of course, with this she is also letting all the Latino voters know that she is on their side. And this will translate into millions of votes in November 2016.

The right thing to do

Be that as it may, I say that being in favor of creating a path to legal status for millions of illegal immigrants is not just good politics. It is the right thing to do. The Republicans who want to be president should come up with their own constructive and credible proposals to fix this problem.

 




If The US Economy Slows Down, Hillary Clinton Will Not Be Elected

WASHINGTON – If we go back to the 2012 presidential campaign, the brilliance of the Obama team was in its ability to turn the tables on Romney. Republican challenger Mitt Romney believed that “he had to win” because of the relatively poor state of the US economy. He honestly believed that the elections would turn into a national referendum on Obama’s manifestly mediocre skills as an economic policy manager.

How Romney was defeated

Well, it did not work that way. The Obama people counter attacked by successfully painting Romney as a heartless “vulture capitalist”, a predator who stripped assets from the companies he bought, tossed the scraps away, and enriched himself in the process. This was and is a ridiculous caricature of a successful business person. But the demonization strategy worked, very well.

From that point on, contrary to all predictions and plans, Romney was on the defensive. Add to this a number of egregious self-inflicted wounds, (such as comments about 50% of America being dependent on public largesse), and we can see how Romney, for a long moment the inevitable 2012 winner, was sunk.

Difficult to use the same script in 2016

Now, as we approach the 2016 elections, it is my contention that Hillary Clinton’s main political vulnerability is also going to be a very soft US economy, or worse an economy in recession. However, contrary to 2012, I am not sure that she will have another Mitt Romney who could be just as easily demonized. This trick would not work with former Florida Governor Jeb Bush or Ohio Governor John Kasich.

The US economy is getting weaker

Of course, predictions about what may happen more than a year from now are likely to be wrong. But this is the way I see it. The US economy right nows is performing in a mediocre but semi-acceptable way only because of the compounded effects of the longest zero interest rates policy (ZIRP) period in modern history. We know that the Federal Reserve will have to stop this insanity at some point. It may be later than we think. But it will have to be done. We also know that rising interest rates will cause the end of the current Wall Street bubble, with unknown, but mostly negative ripple effects.

Over stretched consumers

In the meantime, the US consumer –the traditional engine of US GDP growth– is once again over leveraged and over stretched. Do not count on the average Joe to pull the American economy forward on the basis of his willingness to keep spending more and more by getting deeper into debt. The average Joe is maxed out. He has already used up all his credit, while his disposable income is flat. And the consequences of high debt and income stagnation are huge. Flat or lower consumer spending will act as an enormous brake on an economy that is mostly driven by it.

No new exports

More broadly, the international economic scene is not that promising. Countries that buy from America, (think of Europe and Japan), are in serious trouble. If they are lucky they will stay out of recession. Any new growth will be very modest, (may be 1%). Therefore they will buy less from Caterpillar, IBM, General Electric, or United Technologies. Add to weak export markets the parallel phenomenon of a rising dollar and you see that growing or even keeping traditional export markets will be an impossible challenge for US producers.

Time is everything

All these trends indicate a weakening, not a strengthening, US economy, possibly a recession coming soon. Of course, here timing is everything. If (with luck) things continue along present trends, (modest economic growth, low unemployment), right up to the elections, then Hillary Clinton has almost nothing to fear.

But if we have a real slow down, or may be a recession, right before the elections, Hillary Clinton’s chances to get to the White House will diminish, may be they will vanish altogether. Whatever her customized “new” message may be, after all she is another establishment Democrat who served under Barack Obama. Really hard for her to distance herself from his legacy when it comes to economic policies.

US economy chugging along, Hillary Clinton wins

If none of this will happen, if, come September-October 2016, the economy is alright or on the upswing, then beating Clinton will be very, very difficult. She would be able to claim that more of the same economic recipe, with a twist here and there, works well.

Unfortunately, America has gotten used to mediocre economic performance softened by subsidies and public assistance here and there. The Republican basic message focused on relaunching private enterprise while cutting down suffocating regulations will resonate with some, but not with a majority of Americans. Most of them, assuming no sudden crisis hitting them, are likely to choose the devil they know.

It is a sad commentary on America that the Republicans should hope on a recession as the lucky development that will increase the chances of their nominee to gain the White House.

 




Without Access To A Good Education America’s Poor Will Stay Poor

WASHINGTON – President Barack Obama won re-election in 2012 largely on the promise that, with him as president, all the existing federal welfare and entitlement programs protecting the poor would be safeguarded.

Protect the safety net

He won the day by convincing millions of Americans that the mean-spirited Republicans were going to destroy America’s sacrosanct “safety net”. According to the Obama campaign, Mitt Romney and his running mate Paul Ryan were determined to cut Social Security, Medicare, Medicaid, and other measures aimed at supporting indigent single mothers, poor children, and what not.

Addressing the poor and the struggling middle class, Obama essentially said: “Vote for me, and you will be fine. I’ll take care of you. Vote for Romney-Ryan and you will be in real trouble”. And he won. There is no doubt that the voters bought all his scary predictions about what would have happened if the Republicans got into the White House.

Welfare programs do not work

Fine. Except that now it is becoming more and more obvious that the extremely expensive social safety net fiercely protected by the Democrats in the name of “social justice” and “fairness” at best provides some economic relief.

However, all these programs do not accomplish their stated objective: reduce poverty. Thanks to various forms of welfare, the poor are subsidized, and so that they can get by. But their basic conditions do not change.

The fact is that all these programs do not create real opportunities for the poor to get out of poverty. Their net effect is to “stabilize” poverty, so that the poor do not become destitute; but they do not help eliminate poverty.

Indeed, under this supposedly enlightened and benevolent system, most of the poor stay poor and will stay poor.

And, to make things worse, just as before, the poor are mostly minorities. While the overall poverty rate in America is 15%, For Blacks it is 27% and for Hispanics it is 24%.

A good education is the only real path out of poverty

At the cost of oversimplification, here is my assessment. Welfare programs fail because they focus mostly on income support.

But, while helping people to get by is important, the truth is that in most cases poverty begins at birth. And it is clear that if you are a poor child in America the only real path to get out of poverty is not welfare but access to a good education. Welfare is about survival. Education is about having a future.

And here I emphasize access to a “good” education. A little, so-so education will not cut it.

It is a well known fact that in today’s ultra-competitive and super specialized economy the good jobs go only to the highly skilled. Everybody else gets what’s left. If you only have a little education, you get the scraps. And if you have no education, you get essentially nothing. Most poor children in America’s receive little or no education. And this enormous disadvantage practically guarantees that most of them will stay poor.

So, here is my point. Unless poor children have real, practical access to a good education, their chances to get out of poverty and climb up the socio-economic ladder are practically zero.

Income support does not change anything

You can provide all the income support subsidies you can think of. However, the only real ticket out of poverty and into the main stream is to get into the productive economy as a real player. And you cannot get there without a good education that includes truly marketable skills. Without the skills that allow them to compete for good jobs, the poor will stay poor.

Sure, thanks to costly government handouts, the uneducated poor will not starve. But they will stay poor, in most cases for ever.

 

 




America Needs A New Interpreter Of The Old Values

WASHINGTON – Intentionally or by default, Barack Obama has become the champion of the dispossessed and of the downtrodden. Against all odds, (considering a weak economy and high unemployment), he won the 2012 re-election with a simple message: Mitt Romney and runnig mate Paul Ryan are “bad people”.

Evil conservatives

Their (evil?) goal, according to the well orchestrated Obama campaign narrative, was and is, (if they get another chance), to destroy the social safety nets that guarantee a semi-decent life for those who work hard but get little from a system that is stacked against them.

If you vote for me –promised Obama– I guarantee that you’ll keep your Social Security, Medicare, Medicaid, Disability Insurance, and the rest of it. And I promise that I shall keep fighting for greater equality. Therefore, and mark my words, don’t be stupid. If you vote for the Republican ticket you are doomed, because they’ll take the little you have away from you.

Well, thanks in part to Romney’s unforced errors that seemed to confirm the artfully created image (by the Obama campaign) of the heartless “vulture capitalist”, Obama got re-elected.

“Sweet Populism” has no standard-bearer

But the moderate right that had placed its hope on Mitt Romney right now is a political orphan. As Pepperdine University Professor Ted McAllister points out in an extremely insightful and elegantly written WSJ op-ed piece, (“Sweet Populism” Awaits Its Leader, August 6, 2014), now within Middle America (traditionally centrist but leaning conservative) there is a palpable yearning for a new, inspired leader (a new Ronald Reagan) who will be able to forge a message of hope based on the reaffirmation of the “Good American Myth”, that McAllister calls “Sweet Populism”.

This is about a set of old (but still vibrant)  principles that explain how “everybody can make it in America” if we would only refocus on self-reliance and industry in this rich and generous land of opportunity that always rewards personal effort, ingenuity and enterprise.

Here is the creed and the program: Let’s unleash the creativity of all hard-working Americans. Let’s tear down the barriers (taxation, hyper regulation, and what not) that stifle individual efforts. Let’s make this country great again.

Conservative and revolutionary ideas

And so, (I would add), we can be both conservatives and revolutionaries, reaffirming the eternal validity of old principles that will allow us to dream about and reach greater heights. And, while engaged in this endeavor, we shall also reaffirm this country’s greatness, a greatness founded on the fundamental goodness of the American people.

“Sweet Populism”: America’s secret sauce

As Ted McAllister puts in his essay:

Sweet populism is a peculiarly American species, organized around a version of the country’s history that is positive and incomplete; stresses the importance of self-reliance; seeks to remove obstacles to individual empowerment when they emerge; and aims any anger it produces at those who deny the essential goodness of the American idea”.

Tea Party got it half right

I fully agree. And I also agree with McAllister that the Tea Party Movement failed to capture the essence of this Good Myth. It could only articulate an emotional anti-government message. “Cut taxes and cut government”. But this is not enough. Ronald Reagan’s brilliance was in his ability to make himself into the prophet of a New Era of Hope, strongly grounded on the reaffirmation of old values.

The Tea Party focused on theoretically correct but in the end abstract and impractical ideas of fiscal purity. In the end, its members have been unable to produce a compelling message that would convincingly combine good ideas that will promote growth, while restraining spending. The Tea Party seems to be “anti-this, and anti-that”. But it is unable to provide a warm, inspiring message that will sway Middle America.

Left: focus on injustice

As McAllister points out, the left has its myth too. But it is not in sync with the narrative of America as a Blessed Land of Opportunity. Its focus is on injustice. The rich rigged the system in their favor. As a result they get all the goodies while the rest of us, hard-working Americans, get the crumbs.

Therefore, the thrust of any progressive public policy has to be the promotion of social and economic equality. And, in order to get there, those who gamed the system now have to pay up.

As the 2012 elections have demonstrated, this “social justice” message, (combined with a weak Republican candidate), worked rather well.

America is on the wrong track

But now we are stuck. While we got out of the Great Recession, there is a general sense of unhappiness. The economy now grows, but only a little, (about 2% a year). Unemployment is down; but it is still very high, (around 6%), while millions of people who are lucky enough to be employed struggle with the meager income provided by their low paying part-time jobs, the only ones they can get.

Indeed, by coincidence the WSJ today also published the results of a national poll that shows how 71% of Americans believe that the  country is “on the wrong track“. This high percentage of really unhappy Americans includes people who voted for Obama in 2012.

Who will lead?

As McAllister writes, the yearning for a new interpreter of the American idea of freedom, and of the promising horizons it can open up today, is there. However, the millions of American moderate conservatives need a convincing standard-bearer.

 




Immigration Reform May Succeed – The Republicans Want Latino Votes – However, Let’s Remember That Immigration Is About Becoming Citizens, Not Just Legal Workers – America Is About Shared Values, Not About Jobs

[the-subtitle ]

By Paolo von Schirach

January 29, 2013

WASHINGTON – In perennially divided and dysfunctional Washington it seems that Republicans and Democrats may have found enough common ground to hatch a decent immigration reform plan that may actually get enough votes and a presidential signature.

Immigration as a priority

Of all the burning issues on the policy makers agenda –budget, debt ceiling, fiscal and tax reform– this is not the most urgent. But it may have risen to the top because the Republicans may have finally realized that they need to end their stupid and self-destructive opposition to legalizing an estimated 12 million people (mostly from Central America and Mexico) here in the US but without legal status.

Romney’s immigration policy

We do remember that Mitt Romney (incredibly) argued during the campaign that he favored “self-deportation” as a solution for illegal immigration. By that he meant that, if we really enforced labor laws and other provisions, illegal immigrants would have no jobs and therefore would be forced to pack and go away. Neat idea. Except that it was and is a colossal idiocy. Imagine 12 million people, some of them in the US for decades, packing and leaving. Very practical, no?

Romney’s totally insane positions on immigration contributed to his defeat in November. The GOP got less than 30% of the Hispanic vote. In some states these low numbers meant assured defeat, given the large numbers of Latino voters.

GOP learnt a lesson?

Well, may be the Republicans in Congress learnt something and therefore now are eager to to appear in favor of reform. At least some of them, (like Cuban American Florida Senator Marco Rubio) want to be in front.

Hard to say what the final product will look like. Still, there seems to be a good chance to get bipartisan consensus on a at least a broad policy goal. The shared objective (so far) is to pass legislation that will create a path to legal status for illegal immigrants. That said, the road to legalization can be made easy or extra complicated.

Easy or hard path to legal status?

If the Republicans are worried about resistance from their conservative core, they will (stupidly again) fight to create an obstacle course for illegals that will become a source of frustration and resentment. Indeed, if you make it too complicated and costly to apply for and then finally obtain legal status, creating a never ending process requiring too much documentation that needs to be checked and approved, accompanied by heavy fines and an endless waiting list, this would defy the policy goal.

I do agree with imposing restrictions for people with criminal records. But if we want to make sure that everybody paid all their taxes and what not (how do you check that, anyway?) this “reform” will soon become a bad story –with all the blame going to those (once more the wicked Republicans in the House) who insisted on making it harder rather than easy to become a legal resident.

Make it as easy as possible

I favor a quick path. We may include fines, but they have to be mostly symbolic, not punitive. As to the principled (again, mostly Republican)insistence that first we must certify that the border is secure and only then we may proceed with immigration reform, I say enough of this nonsense. The US- Mexico border is not totally sealed, but it is mostly secure. Of course, the virtual end of the South to North flow we have seen in recent years has to do mostly with the US recession that halted demand for cheap labor. But some credit should be given to improved border controls.

While in the case of this proposed legislation the devil is really in the details I am reasonably confident that most Republicans will do their best to show that they aren’t dragging their feet. They want to give the impression that they are reasonable and humane people eager to solve an old mess that is really inconsistent with a country ruled by laws.

Remember: this is about citizenship, not about working legally

In all this I really hope to see immigrants fully integrated into the American main stream. The inability to have access to legal status contributed to the creation of ethnic ghettos in which the illegals could more easily hide. As a result we have large pockets of people in America who are here only for economic reasons and who are separated by language and status from the larger society. This is bad.

Immigration reform will be a real success if and when most, if not all, of these residents with no status will be real citizens, with a genuine allegiance, not just to their communities, their families and their jobs, but to the United States of America.

American is mostly about shared values, not about jobs

The Oath of Allegiance to the Constitution –after which a legal resident becomes a US citizen–should not be viewed as a formality, something that needs to get done to compete an administrative process. It should be viewed for what it is intended to be: a reasoned and willful declaration of allegiance to the values of this country, for whose protection and enjoyment the Founding Fathers created our institutions. (The very end of the Oath places the burden of sincere allegiance on the immigrant: “…And I take this obligation freely, without any mental reservation or purpose of evasion…”. This means that I take I take this step of choosing American citizenship because I really want to and mean it).

America is founded on citizens who share and uphold basic values; and not on people seeking mostly economic opportunity. If this country wishes to endure, let’s make sure that all of us, old and new citizens, remember that we are here because we share a vision and not just an economy.




America’s Problem: Half The Country No Longer Believes In The Virtues Of Free Market Capitalism

WASHINGTON – America’s biggest problem –as the recent presidential elections have demonstrated– is that a bit more than half the country no longer believes in unfettered free enterprise as the main engine of both personal and national growth.

Government is better

Obama’s re-election (with 51% of the votes) as the defender of entitlement programs as they are, of state intervention and as proponent of income redistribution through taxation shows that a majority of American voters today believe that the benign hand of government helping them is a better and safer bet than the Republican promise to lower taxes and public spending, so that the spirit of can-do enterprise can be once more liberated and put to work. At least 51% of American voters are not so sure about free enterprise.

Capitalism as a model lost the battle of ideas

Let’s face it. The 2008 recession destroyed capitalism’s credibility and mystique. The system failed. And it failed big time. Most of the almost theological assumptions about the sanctity of markets were proven wrong by the Financial Catastrophe.

Nothing illustrates this failure more than Alan Greenspan’s contrite admission that he –The Flawless Maestro– had made a huge mistake. All his life he believed that financial markets would self-regulate in a fashion that would allow them to price risk appropriately and thus avoid excesses. Well, it wasn’t so. No self-regulation. On the contrary, even the most elementary rules dictating restraint were broken.

And it turned out that our Wall Street Captains were not just unwise, they were in fact complicit in a sinister orgy of speculation and greed in which they all succumbed to the zany idea that financial manipulation would make them super rich. In so doing, they almost sank America.

Romney successfully portrayed as the enemy of the common people

Right or wrong, this is the prevailing narrative. And this is what those who voted for Obama believe in. Poor Mitt Romney came along saying that he had the super manager credentials to really fix this mess.

The premise for his challenge was that Obama had done a poor job as economy’s steward during his first term. “Well –said a confident Romney– let the amateurs go back home and let me, the real pro, handle the economy. I know this stuff. I have done it all my life”.

Well, this impeccable resume became Romney’s main political liability. Precisely because of his close identification with venture capital, Romney was conveniently depicted by the Democrats as the arch-enemy, as the fox in disguise who wanted to run the chicken coop. Thanks to the clever character assassination dished out by the Obama campaign, Romney was doomed.

The audience does no longer believes the old story about capitalism

But Romney was doomed also because a bit more than half of the audience no longer believes the old American narrative of “self-help and individual effort”. People are tired and disoriented. Capitalism failed. Corporate leaders behaved like gangsters.

Therefore, now a liberal Government that promises help looks like a better bet.

And so it was. Obama won the political battle.

That said, the Obama policy medicine is a disaster. He may want to help out with more of this and that –and the people cheer. But he of all people should know that the cupboard is bare. There is no money, while public spending is still trending up.

America does not grow

Obama’s ideological blinders prevent him from understanding that the country needs first and foremost higher growth. From a post war average of about 3%, we are down to 2%. This trend will get us closer to stagnating Europe and all its problems. In order to get to higher growth, it is essential to have a new Grand Bargain that would place entitlement programs on a sustainable course, while reforming our incomprehensible tax system in order to provide a strong encouragement to business creation.

Public assistance for ever?

Of course we need to extend a helping hand to those in need. But only if this is a way to make people self-sufficient sooner rather than later. Unfortunately, the message now is that there are some perpetually weak constituencies that will need assistance in perpetuity.

If you are on the receiving end of these public goodies, this may sound great. Easy for the moment to ignore the combined consequences of low growth, high spending (that goes mostly to assistance and income support, as opposed to investments), and more debt. If we looked at where sorry-looking Southern Europe is today, after having followed exactly this course of action for a few decades, the end game should be obvious. But nobody within this new majority will point this out.

Who will make capitalism believable?

Until and unless somebody will come up with a credible message that will reignite enthusiasm for free market capitalism and sober governance, along with policies aimed at opening up real opportunity to all, America will continue to slowly slide into higher debt, mediocrity and eventually national decline.




Americans Now Believe That They Live In An Unfair Society In Which The Rich Have Rigged The System – Time To Do Our Best To Reinstate The Old Belief In America As “Opportunity Society” With Open Access To All

[the-subtitle ]

By Paolo von Schirach

December 28, 2012

WASHINGTON – True or not, the Occupy Wall street protest movement made the case that America, long ago ceased to be a meritocracy, (if it ever was one). This is a zero sum society in which the dominant classes have rigged the game so that they (undeservedly) get most of the wealth produced, at the same protecting rules that guarantee this manifestly unfair set up.

The 1% got everything

Of course, the numbers support this argument. American national wealth is much, much more concentrated at the very top. Indeed, the happy few who make up the 1% get almost everything. Now, we could argue endlessly as to the new economic dynamics that caused this concentration of wealth and power. We can say that it is about hyper competitive globalization that pushed down middle income earners who can no longer compete against aggressive and lower paid Asian counterparts. We can say that only the super specialized can make it in this new environment. You can say that it is about technology, productivity and what not. You can say that Mitt Romney deserved to become rich by expertly taking over corporations, even though in some instances this meant cutting them down and firing workers who then lost earnings and social status.

Perception of unfairness

You can say whatever you want, but if the accepted narrative –irrespective of the facts– is that this is now an unjust zero sum society in which the super rich make the rules aimed at the perpetuation of their primacy at the expense of the rest of us, we are in big, big trouble.

America’s appeal –no matter whether based on myth or reality– was that it was an “Opportunity Society”. Anybody, provided they had guts and determination, could make it in America.

But now we are told that this is just Latin America before reforms. A small dynastic oligarchy controls almost everything. The peasants get the crumbs. Again, factual or non factual, what matters is that this is what people believe.

Political consequences

The political consequences of this new broadly accepted narrative are huge. If indeed the oligarchs have rigged the system through the political process, then it is only fair that the millions who have been deprived should take back their “fair share” through the political process.

Hence Obama’s insistence in raising tax rates for the rich. We know that this has little to do with a coherent fiscal reform plan. This is political. This is about “justice”. Obama’s constituency is made out of the workers who were fired by Mitt Romney and the other heartless profiteers. It is about time that these greedy vultures hear it from the people.

Be that as it may, we have entered a dangerous territory in which populists can easily manipulate a widespread perception of unfairness.

Reinstate belief in America as Land of Opportunity

It is up to wise leaders to reinstate through words and concrete deeds confidence in the traditional belief that America. People have to be genuinely convinced that America is once again an “Opportunity Society” in which all participants have a fair shot at personal success. The rules are clear and transparent. They apply in the same way to all. Nobody can game the system. Those who try are prosecuted.

I appreciate that this is a really tall order. And yet, unless we succeed, it is good bye to the America we thought we had, a land in which personal drive, rather than birth, privilege and connections, is the main variable determining a person’s future accomplishments.




Romney Condemned By Fellow Republicans For Stating That The Democrats Won Because They Give Stuff To Voters – Yes, Politicians Should Be More Tactful; But The Fact Is That America Has Become An Entitlement Society

[the-subtitle ]

By Paolo von Schirach

November 19, 2012

WASHINGTON – In the make believe world of politics in which telling the truth is a silly (in fact outrageous) idea Romney’s post-election commentary to his supporters is yet another inexcusable gaffe. Imagine that: Romney stated that he lost to President Obama because the Democrat had the irresistible electoral appeal of delivering free stuff to voters.

A horrible thing to say

What a horrible things to say. Think of that: Romney had the audacity to suggest that notoriously fair minded American voters would rather elect a President who promised to keep the gravy train running than an opponent who promised to reduce benefits because they are bankrupting the Nation. How could he even suggest that voters rather like getting benefits.

And now it is clear: Romney really means it. His most recent analysis simply reconfirms what he had already said about the “47%” who feel entitled to get favors, money, subsidies and what not.

Do not offend voters

While candidate Romney’s first gaffe was explained away by other Republicans during the campaign, now that he is dead meat the latest one inspired righteous (and let me add totally fake) outrage. You just do not go around offending the voters, intoned wise men like Louisiana Governor Bobby Jindal. You do not tell half the American electorate that they are just a bunch of leeches. This is really stupid, etc. etc.

Truth is: US has become an entitlement society

Fine, we get it. If you are in politics, you want votes and so you have to be nice to voters. Still, even if we agree that what Romney said was totally tactless and politically dumb, (showing that he never was a natural politician), the simple fact is that what he said is mostly true.

Just like Western Europe, America has become an entitlement society. So much so that entitlement spending is now about 60% of total federal outlays. Contrary to popular beliefs, willfully reinforced by the Democrats, Social Security and Medicare recipients do not get back in benefits what they contributed in payments during their active years. It is an open secret that these mega programs do not pay for themselves. They are subsidized.

Add to them the steep increase in the number of disability pensions recipients, Medicaid, food stamps, expanded unemployment benefits and what not and you see how a large and growing percentage of Americans have become somewhat dependent on Washington’s largess. And, yes, those who get stuff are more likely to vote for the candidates who offer it than for those who argue that, unless the programs are reduced, they become unaffordable.

Obama re-elected because he promised to protect social spending

And the Obama camp message during the campaign was based on this simple understanding of voters sentiments. They successfully painted Romney-Ryan as the crazy –in fact bloody minded– ideologues bent on destroying fully deserved entitlement programs, while Obama-Biden would protect them. And the Democrats clearly won the political argument.

Now, I fully agree with Governor Jindal and other Republicans that this basic fact cannot be the only foundation of any appealing, revamped Republican political message.

Populists only?

That said, if politics is only about blandishing voters, while consciously avoiding any discussion of the hard issues, including the fact that this Nation is about to be crushed by unsustainable debt caused mostly by unaffordable social spending, then the political process is destined to be the exclusive territory of clever populists totally comfortable with the simple notion that in order to get votes you hide the truth.

While the populists get the votes, witness Obama’s success, America’s serious problems are not dealt with today, and this signals bigger troubles ahead. We may not like to hear the truth about unaffordable social spending, but the deficits and debt they generate will come back to bite us.




Defeated Republicans Need To Fashion A New, Vibrant Message Of Inclusiveness And Opportunity – Lower Taxes And Deregulation Not Enough To Win Over The Poor And The Disadvantaged – Education Reform Should Become A Core Issue

[the-subtitle ]

By Paolo von Schirach

November 15, 2012

WASHINGTON – The Romney campaign post-mortem analysis on the unhappy ending of their campaign is that they could not win against Obama, a Democratic candidate offering a lot of free “stuff” –benefits, subsidies, cash handouts– to its large and growing constituencies of self-described “needy people”. People want free stuff, lament the Republicans, and they more likely to vote for a candidate promising it, than for a candidate pointing out that much of it is unaffordable, and deep down bad for you because you become dependent, this way losing your ability to take care of yourself with your own resources.

Insufficient Republican message

There is some truth to this, but only some. Indeed, it is hard to be the party that advocates self-reliance and austerity –meaning spending cuts, thrift and fiscal responsibility in order to get out of the hole of a horrible national debt– and be also popular.

That said, the historic challenge for the Republicans is to elaborate a credible platform that is not just about lower taxes and spending cuts as the golden road to broad based prosperity. This message is terribly insufficient because it is based on the false premise that most Americans are eager would-be self-starters, budding entrepreneurs who just want to be unshackled and free to start their own business. Well, some are; and most of them voted for Romney. But the majority is made out of those who are not that self-confident, plus all the others, (intellectuals, NGOs, academics, media people, wealthy and socially minded celebrities), who sympathize with them.

Rethinking is necessary

This state of affairs requires deep rethinking, unless the Republicans want to be a perpetual minority party. If we go back to the shop worn but still valid metaphor of “the fish”, we see where the Republican deep deficiency is. The old saying is that “ If you give a man a fish, you feed him for a day. If you teach him how to fish, he’ll feed himself and his family for life”.

New message: How to create opportunity

The Democrats have become the leading experts at doling out fish, even though all this well intended charity over time plunged the country into a huge debt hole that will eventually undermine the entire system.

But the Republicans assume that, if you just do away with all the free fish programs, all recipients will start fishing on their own, because they already know how to fish. Well, guess what, some know how to fish on their own, or are at least willing to give it a try. But millions of Americans do not; and they are afraid of the Republicans who want to take away their free fish allowance.

And here is the issue. It is indeed true that open ended welfare creates dependence. But cutting welfare while telling people to fend for themselves is a rather cruel remedy. Millions just do not know how.

If the Republicans want to become appealing to those who receive the aid that is indeed ultimately bad for them on top of being unaffordable, they have to illustrate how they will teach people how to become expert fishermen. In other words, telling people “You are now free to start your own business because we have cut taxes and eliminated all the red tape” is not enough for people who do not know how to start their own business because thy lack the background, the education and the training.

Land of Opportunity?

The challenge for the Republicans is to credibly refashion the old and still valid notion of America as “Land of Opportunity” by explaining in a convincing manner how they intend to broaden real opportunity. For instance, a key element to build an Opportunity Society from the ground up is to give real, quality public education to all Americans. Right now this is not the case. The children of the poor (and the poor are often minorities) start badly in life because they do not have access to a good education. In fact they get almost no education worth the name.

Public education reform should become a top priority

The Republicans should make public education reform a top priority, simply because uneducated people are condemned to stay at the bottom of society, as they lack the tools to fully participate in the economy. No education, no opportunity. In a perverse way, the same people who are betrayed by a public education system that gives them nothing become the obvious constituency for the welfare programs doled out by the Democrats.

Let’s get this straight: economic liberalization, deregulation and lower taxes are great for those who are already in the game; but they are essentially irrelevant for the millions who do not believe they have a prayer of getting in. These disadvantaged millions, by default if nothing else, will opt for the free fish programs, and they will vote for the candidates offering them.

Jeb Bush gets it

It may not be entirely accidental that former Florida Governor Jeb Bush is focusing so much on public education reform. His effort is also an attempt to rebrand the Republican Party as a political force promoting positive social change . In other words, “he gets it”; and we can only wish him an his associates success.