Thursday, April 21, 2016
Required Reading: Clinton the Hawk
The biggest fault line in this year's election isn't Democrats vs. Republicans, it's internationalists vs. isolationists, and it's dichotomy that exists across both economic and political/security policy issues. This is why folks keep saying that Hillary Clinton is the most moderate Republican in the race. Really, she--and John Kasich, too--are extensions of the collective security/free trade consensus that has existed in American political life since the start of the Second World War. By contrast, the others are all looking for some kind of magical "renegotiation" of America's interests, though I don't personally believe that any of them give enough credit to the good that American engagement has done for most Americans.
To put it another way--yes it sucks to lose your job to offshoring. Moreover, offshoring to the extent that we've seen is at least partially a result to bad tax policy. However, all Americans benefit magnificently from the reality that the U.S. Dollar is the world's reserve currency, even if they don't have the education to realize how. This fact means that debts all over the world are denominated in dollars, which gives Americans a massive leg-up in every kind of international financial transaction. This kind of thing is not to be sneered at in a global economy.
When China and other countries game the system to keep their currency values low and increase exports, they are essentially sending us stuff below cost. To do this, they must subsidize the American standard of living at the expense of their own people. That kind of thing has been going on for decades, and now that even the Chinese economy is beginning to show cracks, I expect it's gone about as far as it can go. Rebalance is painful, but the reality is that it can only help Americans--as indeed we've seen over the past several months.
Globalization has not hurt Americans. Far from it. What it's done is to make the vast majority of our crap extremely cheap, which is why everything else, everything that's actually made in America--like Higher Education, as an example--looks exorbitantly expensive right now.
Reality is that America's tax policies are the root of all of our problems. They create incentives for behaviors that are good for the wealthy and lousy for folks who earn income--as opposed to getting income via capital gains. This is what needs reforming, and if you want to know the hard truth, it's that Clinton is in the best position to actually push through the reforms we need. Of course, she may also be in the pocket of Wall Street, so electing her is hardly a guarantee of better policy, but she or Kasich are without question our best bets. If that hurts your feelings, I'm sorry, but you probably ought to keep reading about the issues a bit.