Saturday, November 6, 2010

We're all above average

Here are a few factoids that help explain the mid-term elections--and which the pundits haven't mentioned:

#1: Recently I heard about a study showing that the worst employees almost always rate themselves as superior ones, while the best tend to be very self-critical.

#2: If you watch American Idol, America's Got Talent, So You Think You Can Dance or similar programs, one thing they all have in common is the number of people who show up for auditions who have not just no talent--they have what you'd have to call "anti-talent"--yet who absolutely believe they're God's Gift to the Arts. Interviewed after the Simon Cowells have told them they suck massively, they stoutly maintain that the judge(s) know nothing.

#3: I visited Las Vegas recently. It's full of huge, fabulously expensive casinos, paid for by hordes of visitors, each of whom believes he will leave Las Vegas with his pockets stuffed with Benjamins.

#4: When I taught high school in a largely blue-collar semi-rural school district, I was stunned to discover that most of the students believed they already knew everything that was useful or necessary to know, and that the sole utility of school for them was as a place to socialize with their peers. As a corollary, I found that their belief in stuff like astrology was rampant and credulous, while any scientific claims were met by general scoffing and impossibly high standards of proof.

#4: Sociobiologists believe that human beings constantly overestimate their own skills and chances because it's good for the species for them to do so--even if such delusions have disastrous personal consequences. Warriors go into battle believing the bullet has the next guy's name on it. If they were realistic they'd run.

All this gets us an election in which people with no knowledge or understanding of economics all acted as if they were experts--that what they knew about balancing a checkbook was sufficient to know what the nation needed.

The Republicans' strategists understand mediocre people's intuitive overevaluation of their understanding, constantly telling them they knew more than those Democrat eggheads.

A perfect example is the balancing a checkbook analogy. In fact nearly every large business got there by going into debt. For that matter, nearly every middle class family is in debt because they bought their home on credit, not with cash.

Of course it's insane to go into debt to buy luxuries, or to gamble at the nearest Indian casino. But going into debt rationally is exactly what the word "investment" means. We buy a house on time--not too expensive a house, mind you--because it's a good investment. We shoudln't buy a luxury car on time because that's a bad investment.

So to say that government must always avoid deficit spending is a principle that doesn't work for business or for families.

And it's not what people mean, anyway. What they mean is this: "Deficits don't matter (to quote Vice President Cheney) as long as it's for things I like, spent on people I like. While no amount of money, deficit or not, should be spent on things or people I don't like. Democrats take money from white people and spend it on colored (black and Mexican) people and foreigners. Obamacare is free medical care for blacks and Mexicans taken from whites, so it's bad. The bailout was for rich people, who aren't as bad as blacks and Mexicans because they look like me, but it's still bad. Republicans are my tribe. Democrats are a different tribe trying to conquer my tribe, so they aren't just bad--they're enemies."

Good economists have conceded that all theories and predictions based on market and business leaders being rational fail. Economics only gains predictive power when it takes into account human foibles.

Ditto elections. So, as I keep saying, it's not about the economy. It's not not about the economy either, but almost nothing that was said by the Republicans and their minions and their masters was factual.

Go back to those business analogies. A big company gets in trouble. Its stock plummets. Sales tank. That happened at Chrysler, for example, largely because Chrysler cars look sexy but aren't reliable. In the crisis such a company should keep a tight lid on executive compensation and make sure to week out employee dead wood. But it also needs to spend--with borrowed money--on improving its product, and then on communicating how improved its products are. It can pay for that deficit spending when times are better. But if it doesn't spend then, times won't get better.

And then in good times it needs to reign in unnecessary spending (such as lavish manager compensation) so that it has a fat war chest for the bad times.

The Republicans have it exactly backwards--when the good times roll they spend like drunken sailors. Then in a bust they want to turn off the spigots.

That serves no one's interests but that of those who are insulated from suffering in the bad times--think CEOs with golden parachutes--and who have--and see--no need for a social safety net.

And the Republican Party and its faithful adherents always advocate policies that agree completely with the interests of the CEO/investor class. Purely by coincidence, of course.

1 comment:

n1ck said...

People are self-deluded, I think, because they need to be to stay sane. Imagine if the American Dream was revealed for what it is: a pipe dream.

The Government is usually seen as a bastion against any country's oligarchy. If there is rule of law, and basic democratic rights, the people can ensure that the richest and most powerful individual members of that country cannot co-opt the Government and use it for their own gains.

Here in the US, I'd argue that the classic Republican argument that Government is "bad" and that business can solve all ills, is really just the oligarchy trying to categorize the Government (Government BY the people, FOR the people) as bad so that their interests (money and power) are not only less regulated, but also able to use the Government as their own private bank. Sound familiar?

To tie it all together, I think what you have is the Republican party as a whole trying to demonize the Government as bad so that business and money has more power. They do this by convincing the less-educated and more socially conservative voters that they are much more intelligent and imbued with common sense than the "intellectual" Democrats.

What is tragic is that Government really can work for the people, but you need good, honest people in Government. While I'm not going to pretend that Democrats are good and Republicans are bad, I do find it odd that Republicans say that Government never works, claim that they want to "starve the beast", or make it small enough to "drown in a bath tub", and then run for political office and sit there for decades living off the taxpayer, and getting rich on the side.

Why the electorate hears Republicans speak in contempt of Government as inherently bad, and then continually elect and re-elect them to make sure that prophecy fulfills itself is just beyond my understanding.