The Affluent (and Downgraded, Debt-Laden) Society

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Tim Kowal

Tim Kowal is a husband, father, and attorney in Orange County, California, Vice President of the Orange County Federalist Society, commissioner on the OC Human Relations Commission, and Treasurer of Huntington Beach Tomorrow. The views expressed on this blog are his own. You can follow this blog via RSS, Facebook, or Twitter. Email is welcome at timkowal at gmail.com.

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38 Responses

  1. Avatar david
    Ignored
    says:

    It seems a little disingenuous to claim that raising the debt ceiling has no academic justification.Report

  2. Avatar Ian M.
    Ignored
    says:

    Corporate taxes in the US are low, not high. Rates are high, but the amount collected as a percentage of GDP is low:
    http://www.bnet.com/blog/financial-business/freeloaders-us-corporate-tax-rates-are-among-the-lowest-in-the-world/14623
    Does this then strongly suggest that liberalism has *secretly* prioritized production as the touchstone of labor since you’ve quoted an accurate account of the theoretical rates and I’ve provided one for the actual rates? And when you misrepresent the truth in your thesis paragraph, in a howling obvious fashion, why should one read on?
    But lets move on anyway. Cox and Alm agree that workers today are better off – partially because we have welfare now. Also no mention of the spiraling cost of health care and how that works into the total economy of poor/working class families. But if you’ve never hung out with anyone who’s working class I can imagine believing that the poor are better off now than ever before.
    The lessening of the work week of course had nothing to do with improvements in technology and the emerging labor movement’s ability to bargain for better working conditions while the spoils of this increased productivity were being created. But then again, Kowal doesn’t bother to prove that productivity is falling because we are working less hours.
    It goes on and on.
    But the great thing about Kowal’s work if you’re a leftist is that these very impressive posts are so long and astonishingly dull that I know very few people really read them, and that those who do read them and agree make up such a micro-fraction of the world that the impact is virtually nil. Therefore, they are not very important to rebut in full. But they are interesting as exemplars of confirmation bias and the power of heuristics even on someone as obviously intelligent as Kowal.Report

    • Avatar Tim Kowal in reply to Ian M.
      Ignored
      says:

      Ian,

      We can discuss the relevant differences between corporate taxes in terms of rates versus percentage of GDP, but I don’t understand your accusation that I’m actively misrepresenting any facts in “howling obvious fashion.”

      If you’re upset that the post is already too long, I have trouble understanding your criticism it does not also include discussions of health care and poverty.

      Finally, notwithstanding the opening and concluding paragraphs, what I hoped to do was set out some of Galbraith’s core economic observations, many of which are really quite compelling. While I offer a few counter-arguments to them, I cannot hope to offer a full and compelling attack in the context of a blog post (if ever, given I am not an economist by any stretch).Report

      • Avatar Ian M. in reply to Tim Kowal
        Ignored
        says:

        You stated “with…corporate income taxes among the highest in the developed world” This is factually inaccurate – tax rates are high but actual taxes paid are low. If you are unaware of the vast gulf between the rates we have and the receipts we collect, the I suppose it is not “howling obvious” but ignorance. As a scientist, I always defer to the world as opposed to fanciful notions about the world. To continue to insist that corporate taxes in the US are high after it is pointed out that they are not is mendacious or at least deserves a substantive rather than rhetorical response.
        This item is used as evidence to “strongly suggest modern liberalism has de-prioritized production as the touchstone of progress”. If your evidence is in fact opposite, it is either irrelevant to your point or contradicts it. For both cases it reflects either on the quality of your reasoning or your thesis.
        What I’m trying to get at, on a meta-level regarding your posts, is when faced with a long intellectual post where you find a smelly poop of falsehood in the first graph, that other commenters have also pointed out, it gives your readers – especially the ones that are not aligned with your political ideology – an excuse to tune out. When I encounter blog posts like this, I know they are not influential and are not in need of full rebuttal. I am not complaining that your posts are too long – I am gladdened because you are unable to marshal your considerable intellect towards making a succinct point which can influence people towards a worldview I disagree with.Report

        • Avatar Tim Kowal in reply to Ian M.
          Ignored
          says:

          Ian,

          You misunderstand the premise of the entire post:

          “For Galbraith, production was central to the modern American economy not to sustain impressive arrays of consumer goods but instead to provide economic security for its citizens. Liberals failed to grasp the distinction, believing instead that “increased production remains the touchstone of political success even when it involves additions to an already opulent supply of goods.” Half a century later, it might be argued that even if liberalism still insists it has no fixed principles, it now acts like it understands the distinction . . . .”

          From there, the bulk of the post is devoted to explaining Galbraith’s thesis, i.e., why production is no longer important for its own sake but instead for the sake of economic security. I posted the piece anticipating—incorrectly, apparently—that most readers here were left-leaning and thus would be predisposed to Galbraith’s economic views.

          Given that, do you disagree with my thesis (that modern liberalism can be explained by regarding production primarily as a means to economic security), or with Galbraith’s?

          Again, I thought both theses would be uncontroversial around these parts. That is why I offered only a few anecdotes that suggest liberals have changed their emphasis on production—which would have greatly pleased Galbraith, to whose ideas I give a pretty warm reception. I had not prepared to engage in a full-throated discussion on the U.S. corporate tax climate. Indeed, you have further proven my point that liberals are not principally concerned with production qua production given you have taken issue with the proposition that U.S. corporate tax rates are among the highest in the world by suggesting that corporate tax receipts are too low.Report

          • Avatar Ian M. in reply to Tim Kowal
            Ignored
            says:

            I disagree with your evidence, because it is bullshit. The proposition that US corporate tax rates are among the highest in the world is noncontroversial, but that is not what you said in your post.

            My point is that when reading your posts, why should I keep going past the first pile of bullshit? How many mistakes should you be allowed per post before I just walk away?

            Also, I did not suggest that corporate tax receipts are *too* low – that is your embellishment made to suggest this is a gentlemanly disagreement of opinion when in fact you were factually wrong.

            So in your response you tried to subtly change your original words and also tried to change mine. I’m left thinking you are a sophist more interested in “winning” an argument than living in a world of facts.Report

  3. Avatar Art Deco
    Ignored
    says:

    If I understand what I read in the business press, successful fiscal consolidations take four or five years. In the iterim, the government must borrow, which means the Treasury needs the authorization to borrow. If Michelle Bachmann imagines an immediate 40% cut in federal expenditure will be therapeutic for the political economy, she is mistaken.Report

  4. Avatar Barry
    Ignored
    says:

    “and corporate income taxes among the highest in the developed world st”

    Adding onto Art Deco – Tim, if you can’t tell the truth in your posts, why should we give a sh*t? The blogosphere is not short of glibertarian propagandabots, and even glibertarian islamohaterbots.Report

  5. Avatar Rufus F.
    Ignored
    says:

    It’s hard for me to really criticize the meat of this post since I was trying to make many of the same points in that thread where I was going on about the national fixation on continuous, steady, unlimited economic growth and why politicians shouldn’t have pinned the electorate’s expectations about social goals to such growth- in years when the economy doesn’t deliver, the state is still expected to and the inevitable result is, yep, spiralling state debt. I was also trying to say that the Tea Party isn’t exactly wrong in pointing this out, so I guess we agree there too.

    Now whether it really was just the liberals that set up this expectation that, if there is economic growth, the society-wide standard of living should be steadily and uniformly improving (and I’m not convinced that’s the case), the fact remains that both sides are now regularly demogoguing disappointments to these unrealistic expectations. It’s the government’s fault that there isn’t full employment! You voted for them and they let you down! I expect that we’ll hear whoever’s not in power make that sort of attack on those in power for the next several years, all the while continuing to inflate the idea that the government is directly responsible for making sure everyone’s doing well, which of course brings us to the other side of this corporatist coin: corporate welfare and bailouts. Not sure at all why you left those things out of your first paragraph there, but if we’re saying that government has adopted the mentality that it’s the state’s responsibility to keep the safety wheels on capitalism, surely those things apply too, right? If you want to talk about people who expect regular handouts from the government, let’s acknowledge that they’re not all private citizens. As for my gripes about your last paragraph and what the debt ceiling actuallly does, I’m sure others will post comments on all that.

    Finally, I have to say I wish you’d post more often about conservatism. I’m of the opinion that this site could use more compelling writing by conservatives about conservatism (which often seems missing on a site that has so much about liberalism and libertarianism). Instead, you often write these lawyerly posts about the incoherence or intellectual inferiority of liberal ideas as if that sufficiently supports conservative thinking. It gives me the impression I frequently have when reading conservative blogs that the writers really wish that liberalism would reform itself so they could vote for Democrats. (Admittedly, I’m probably the only person holding this theory about David Horowitz, but I stand by it!) Anyway, that’s less a gripe than a request.Report

    • Avatar Tim Kowal in reply to Rufus F.
      Ignored
      says:

      Rufus,

      Writing this post was, for me, an opportunity to try to work through and understand Galbraith’s arguments. Yes, I offered a loose argument that his economic theories might explain modern liberal economic policies, but I admit it is not comprehensive since it was not the primary purpose of the post. Not being an economist, and not being very familiar with liberal economics, I was unexpectedly impressed by Galbraith’s observations.Report

    • Avatar Barry in reply to Rufus F.
      Ignored
      says:

      “Finally, I have to say I wish you’d post more often about conservatism. I’m of the opinion that this site could use more compelling writing by conservatives about conservatism (which often seems missing on a site that has so much about liberalism and libertarianism). ”

      It doesn’t really matter, because there’s not enough conservatism to matter in the USA – except on the left. On the right, we’ve got people who look at the 20th century’s very hard work in making a better USA, and want to destroy it. Quite deliberately.Report

      • Avatar Rufus F. in reply to Barry
        Ignored
        says:

        Be that as it may, I live in a coutry with conservatives who are just traditionalist, Tory, somewhat stodgy guys who just believe that spending must match revenues and couldn’t care less about who has sex with who (even mentioning that makes them uncomfortable). It’s a respectable middle-aged mindset here. The result is people like my father-in-law who has said to me that he’d be very lost if he lived in America and have nobody he could vote for.Report

        • Avatar Rufus F. in reply to Rufus F.
          Ignored
          says:

          So, what I’m saying is there must be people like that down here who are trying to articulate a more traditional form of conservatism and not getting much airplay in the media. Generally, I think this site works best with writers who aren’t entirely comfortable aligning themselves with any of the parties.Report

        • Avatar Art Deco in reply to Rufus F.
          Ignored
          says:

          Umm. Political organizations rooted in the homosexual population have agitated for a number of policy changes. Co-incident with that, the educational wing of the industry which produces contraceptives successfully agitated to have their materials incorporated into school curricula.

          About a generation ago, Judith Martin offered that the decay of manners has been such that people who knew precisely what was going on and were willing to say nothing were forced to declare themselves. Same applies here. Not the fault of our insufficiently stodgy conservatives.Report

          • Avatar Rufus F. in reply to Art Deco
            Ignored
            says:

            Yeah, I’m not sure how I said it was their fault. My point is there are conservatives down there who care greatly about cultural issues and have a vague understanding of economics, and then you have people here in Canada who call themselves conservatives because they’re very fiscally conservative and that’s their focus, but are unconcerned with cultural issues. What should they be called instead? And whatever we call them, are there really no “conservatives” of that sort in the US?Report

            • Avatar Art Deco in reply to Rufus F.
              Ignored
              says:

              What you are referring to would have been the default for my parents contemporaries, ca. 1963. It got to be an increasingly untenable propostion after that. Untenable it may be, it is still common. In point of fact, it may still be the default in your local Republican caucus in my neck of the woods.Report

  6. Avatar Frank in midtown
    Ignored
    says:

    Your assumption of a 35% fed tax rate belies the truth that no corporation pays anywhere near that rate. Wildly profitable corps with fast growing earnings pay in the low 20% on the income they chose to recognize as US based.Report

  7. Avatar North
    Ignored
    says:

    I was with you generally up until your final paragraph which makes all the preceding writing suddenly seem to morph into a lengthily worded Tea Party pitch which strikes me as quite unfortunate. A bit of balance in that final part really would have benefitted your over all narrative.Report

    • Avatar Tim Kowal in reply to North
      Ignored
      says:

      North,

      Understandable. Conclusions are hard. Sometimes I will offer balance, as you suggest, but then worry that the whole piece comes off sounding mealymouthed. I think it’s important to give the reader, particularly one that is willing to read a long post, an idea of the author’s basic political views.

      On the other hand, I hope I did not give the impression that I take Galbraith’s ideas to be without merit. I think they’re wonderfully interesting and continue to be worthy of discussion. I do think it odd that liberals, who ultimately rely upon somewhat esoteric economic theory to support their economic policies, tend to be the ones bringing the rhetoric to new lows while doing little if anything to provide real justification of their preferred policies.Report

      • Avatar Vertov in reply to Tim Kowal
        Ignored
        says:

        “I do think it odd that liberals, who ultimately rely upon somewhat esoteric economic theory to support their economic policies, tend to be the ones bringing the rhetoric to new lows while doing little if anything to provide real justification of their preferred policies.”

        Your last paragraph is exactly the kind of negative, partisan shot that turns off the kind of person who would make the effort to read this kind of post. The rest of your post, while I disagree with it, is actually a thoughtful explanation of what right-wing economists think.

        And you *really* don’t want to be saying that its the liberals who say the negative things in politics. There’s a vast universe of right-wing media can traffics in justifying esoteric economic theories with insults.

        DUReport

        • Avatar Tim Kowal in reply to Vertov
          Ignored
          says:

          Message received. You’ll have to hit me up later if we’re going to try to objectively assess who uses more heated rhetoric, however. The “terrorist” meme is still ringing in my ears pretty loudly.Report

          • Avatar Vertov in reply to Tim Kowal
            Ignored
            says:

            What rings in most liberals’ ears are the variations on “communist.” Speaking as a fellow Orange County attorney, I can attest that some regulation is pretty ridiculous for the small businessman. But if you listened to talk radio, you’d think this was about putting people in chains.

            Do recall that you once had a big dust-up ’round these parts when you wished Muslims had “better PR” because conservatives acted as if all Muslims were LITERALLY terrorists, or at least terrorist-sympathizers.

            I think that particular charge, btw, still rings in some Muslim’s ears.

            So if you want to be part of the solution to the “civility” problem, I suggest you take your own advice. No one at the League was calling you a terrorist.

            DUReport

          • Avatar Chris in reply to Tim Kowal
            Ignored
            says:

            Funny, I heard Bill O’Reilly calling liberals terrorists just last week.Report

            • Avatar Jesse Ewiak in reply to Chris
              Ignored
              says:

              And ya’ know, Mitch McConnell admitted he was taking hostages. But, ya’ know, if we actually point silly things like that out, we’re the bad guys. Maybe we just need better PR like the Muslims.Report

      • Avatar Barry in reply to Tim Kowal
        Ignored
        says:

        “I do think it odd that liberals, who ultimately rely upon somewhat esoteric economic theory to support their economic policies, tend to be the ones bringing the rhetoric to new lows while doing little if anything to provide real justification of their preferred policies”

        Now you’re just lying. The right has Chicago Economics, otherwise known as ‘F*ck the real world, we’ve got tenure’. And the Tea Party. And the GOPgelical crazies, who can’t decide if they want the Rapture or Gilead, or both, or in which order. And the libertarians, who are (economically) nothing but esoteric theories. And the Plutocracy, who are well grounded in reality, and intend to use it to screw over the rest of us. And non-plutocratic right, who are eager to get screwed (except for their servants, who figure that they’ll collect a cut by helpping to screw the rest of us over).

        Heck, let’s take you – [false statements of fact concerning the author deleted following email notice to the commenter –TK]

        In your original post, you wrote: “Democratic alignment with anti-competitive and anti-democratic union agendas, labyrinthine regulations that stifle businesses and cramp innovation, and corporate income taxes among the highest in the developed world strongly suggest modern liberalism has de-prioritized production as the touchstone of progress. ”

        You were already shown to be quoting a non-reality-based source on taxes (hmmmmmmmmm – like Spencer?) and as for the rest of that paragraph – how well are corporate profits and cash on hand right now? I’d like some o’ dat oppression. Please tell some mean ol’ liberals to come over and whack me until I’m rich.

        The liberals are the ones looking at what’s happening now, and what has happened, and drawing conclusions from it.

        The only thing that the right – and this include the libertarian movement – has going for it is a very successful lie and fraud campaign that draws strength from the very destruction it causes.Report

        • Avatar Rufus F. in reply to Barry
          Ignored
          says:

          “Heck, let’s take you – [false statements of fact in quoted comment concerning the author deleted following email notice to the original commenter –TK]”

          You know, I remember that post and I remember disagreeing with Tim, mostly because I thought his assessment was way too optimistic about what Muslims could accomplish in the current public sphere. But it’s becoming like a game of telephone here: every time someone describes Tim’s post on Islam and PR, the description gets farther away from what he actually wrote.Report

        • Avatar Barry in reply to Barry
          Ignored
          says:

          Note – Tim notified me; I refused to retract my comment.Report

  8. Avatar Dan Miller
    Ignored
    says:

    Could you link to some liberals unashamedly supporting the lemonade stand closures? I don’t dispute that they were closed, but “unashamed support” seems a little strawmannish.Report

  9. Avatar Chris
    Ignored
    says:

    As Galbraith put it, “[t]he man who makes things clear is a scab. He is criticized less for his clarity than for his treachery.”

    Funny, I would have applied this quote to the other side.Report

  10. Avatar LVTfan
    Ignored
    says:

    I’d quibble with one thing you wrote. Henry George was not a socialist. Many who were inspired by his vision, in “Progress and Poverty” — including George Bernard Shaw — eventually became socialists, but George’s ideas were strictly those of cooperative individualism on a level playing field, created in large part by a system that would recognize that all of us are equally entitled to the bounty of nature and to that which the community creates.

    What Henry George sought to “socialize” is that which nature provides and that which the community creates, which he and many think ought not to be subject to privatization. Those who claimed bits of nature as their own owe their community for secure title, month in and month out, in the form of rent or royalties. Those who claim a bit of urban land as their own owe their community the current rental value of the land, month in and month out.

    At the same time, he held that each of us is entitled to keep what we create, and would likely argue that those of us who today pollute the air and water would own that pollution, too.

    George’s ideas are too little known today. There are a number of websites where one can learn more: answersanswers.com, cooperativeindividualism.org, wealthandwant.com and masongaffney.org are some good starting points.

    People as diverse as Tolstoy, Mark Twain, Henry Ford, Milton Friedman, Bill Vickrey, John Dewey, Tom L. Johnson and Aldous Huxley, even Theodore Roosevelt, have embraced George’s vision and solution. Today, they’re barely known to most economics majors, which is a shame. They seem to me to offer our best hope of a just and efficient society in which all can prosper.Report

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