I was listening to Batya Ungar-Sargon on the Fifth Column the other day and realized we had fundamentally different models of how the modern American economy works. This post is exploration of how I think we ought to model the economy without much math.
Batya’s argument against immigration is that an influx of foreign workers increases the supply of labor, thereby driving down wages of the people already here. Her position singles out low-wage workers, suggesting that illegal immigrants take jobs from low-skilled domestic laborers, depressing their wages. However, this view is problematic for several reasons and fails to account for the nuances of the modern American economy.
First, as a side note, we could prioritize an immigration policy that tries to attract highly skilled instead of low-skilled workers! The Institute for Progress has a whole interactive tool on how to do this. But the last time there was a Republican President, Trump actually reduced legal high skilled immigration.
But more importantly, the American economy is not a fixed pie where low-skilled immigrants simply compete with Americans for a limited number of jobs. Consider a worker from Honduras. In their home country, employment opportunities may be limited, with jobs primarily in agriculture, local services, or perhaps managing a hotel catering to foreign tourists. However, if that same worker were to immigrate to the United States, their productivity would increase significantly, even if performing the same job.
The United States is an advanced, technologically sophisticated economy with a vast accumulation of capital and expertise across various sectors. By operating within this economic environment, workers gain access to cutting-edge technology, sophisticated management systems, and an abundance of resources that enhance their productivity. For instance, a hotel manager in the United States would likely oversee operations catering to business clients from major corporations, leveraging management software, efficient business processes, and integrated systems to optimize efficiency and service quality. Most American hotels require very few people to run them because there is so much automation already deployed. The same worker, performing the same role but within the context of the American economy, would become exponentially more productive due to the surrounding technological infrastructure and capital resources.
This phenomenon is not limited to the hospitality industry; it extends across the entire economy. The United States is a knowledge-based, service-oriented economy, where workers can be highly productive by leveraging the accumulated expertise, human capital, and technological advancements embedded within American companies and institutions.
You can see this dynamic if you take the Cobb-Douglas production function, which is a fairly simple model of outputs as a function of labor (L), Capital (K), and total factor productivity (A):
Total Factor Productivity or TFP represents technology, knowledge, and accumulated innovation that isn’t directly attributable to adding more labor or machines and buildings. In the US, TFP and capital components of this function are remarkably high, suggesting that the economy is labor-constrained. Adding even a small amount of labor can lead to substantial increases in productivity due to the abundance of capital and technological resources available.
And we see this concretely in the fact that Americans are paid so highly. Immigrants come to the US and see massive pay raises because they are now embedded in a economy with highly advanced knowledge, processes, technology, and automation. The American economy is adept at integrating labor and equipping workers with the knowledge and tools necessary to become highly productive contributors.
Furthermore, immigrants not only contribute to the labor supply but also represent a source of consumer demand. By purchasing housing, goods, and services, they stimulate economic activity and create opportunities for further businesses and workers across various sectors. Immigrants need to buy houses, groceries, haircuts, and cars too.
Of course, that doesn’t mean we should necessarily just throw open the gates to all immigration immediately; the fact that there are large benefits does not mean there are no costs. It takes time for new workers to be integrated into any economy and for their spending to be accounted for in new supply for everything they are buying. If new workers are concentrated in a specific industry, it can take time for that industry to expand to accommodate the new labor market. Thus, we can suggest specific policies that would lessen immigration impacts that are concentrated on specific people or industries.
For example, we should make the labor market as dynamic as possible. Hiring and firing should be relatively easy. Public sector unions that protect poor performers make it their services worse and make it harder to higher good talent. Also, healthcare should not be tied to your job. This would make any specific job relationship less critical for workers since switching jobs doesn’t mean switching providers. It also reduces the cost and overhead for employers to hire new workers, especially for low wage workers where healthcare would be a significant fraction of total compensation. We can also have regulations that require immigrants to live in different areas of the country. The US is a vast economy with 54 metro areas with over a million people, and over a 100 with populations over 500,000. That’s a lot of local economies we could spread immigrants out over to avoid huge shocks to the housing markets if immigrants concentrated on specific cities. As far as specific industries, many other countries have specific point based systems to target immigrants with key skills. The U.S. largely does not do this, and we ought to.
In summary, the belief that immigrants depress wages and displace native workers is the result of a direct failure to understand fundamentally the dynamic and efficiency of the American economy. The United States is a highly advanced, knowledge-based economy that can effectively leverage additional labor by integrating it with its vast capital resources and technological sophistication. Rather than viewing immigration as a threat to the working class, it should be recognized as a potential source of economic growth and productivity enhancement, particularly in a labor-constrained environment. When there are drawbacks, our goal is to figure out how best to minimize them in order to fuel the economy and make America grow.
Earlier this year I put together a list of most important policies that the U.S. federal government could implement which are actually discussed by candidates. The list takes into account impact both broad and deep. Also as part of my election year discussions, I’ve covered issues with our current electoral system and then, given those problems, whether it makes sense to spend time researching and voting in elections where you’re only one of many thousands or millions of voters. I conclude that in close elections where there are large differences between the major party candidates, it often makes sense to vote for one of the two candidates.
This post will take a look at this year’s presidential candidates based on their policies. I’m putting aside non-policy issues, like competence, corruption, and impact on democratic norms as I intend to cover them in my next blog post. I also think a policy-specific approach is useful to cut through tribal identities and focus on actual impacts in the real world. Extending the discussion from my last essay, I will be comparing Trump and Biden to see if there are large expected differences in their policy. As stated in that post, swing state voters should probably vote for one of these candidates since their expected value of voting would be high.
This post will be aimed slightly right of center since my policy analysis shows Trump doing very poorly compared to Biden. Based on purely policy grounds, I think swing state voters should vote for Biden, even if they are conservative. I will be taking inspiration from my previous post about important policies. If you want more background on why I think these policies are most important, I suggest skimming it first.
Great Power Relations
This is a newer issue that I wanted to focus on after reading The Precipice and its discussion of existential risk. I recommend that post, but in summary: an existential event is uniquely terrible because not only are there no humans left on earth, but any future human civilization ceases to exist. We are doing very little today to assess these risks or to plan and coordinate how we might deal with existential risks. Toby Ord estimates a 1 in 6 chance of human extinction this century. Even if that’s high, Metaculus suggests a 2% risk which is still completely intolerable when discussing the future of humanity.
Presidential politics isn’t really discussing existential risk directly, but the presidency has an outsized impact on great power relations, particularly between the U.S., China, and Russia, and catastrophic relations between them could significantly heighten existential risk. Indeed Toby Ord specifically discusses great power relations as a major risk factor in his book, and Trump’s own Defense Department notes the heightened nuclear landscape we find ourselves in their 2018 Nuclear Posture Review (Brookings Institute discussion). China and the U.S. have essentially incompatible views of liberalism, freedom, and human rights, and the world is better off with an America that promotes those ideas and thwarts China’s authoritarian ideology without resulting in dangerous tensions.
Conventional wisdom might suggest Trump was especially tough on China, but in reality he emphasized the exact wrong points at the expense of actual geopolitical power. He started a trade war, harming the U.S., which ultimately resulted in extracting Chinese promises to purchase additional American exports. While undertaking these trade negotiations, Trump refrained from criticizing China’s curtailing of the rights of seven and a half million residents of Hong Kong, and allegedly even encouraged Xi Jinping to construct Uyghur re-education camps. Chinese negotiators have stated they prefer Trump’s reelection because his goals are so transparently materialistic, and those goals are in areas where the CCP can compromise, unlike other American administrations’ focus on human rights. Trump also abandoned the Trans-Pacific Partnership, a Pacific based broad trade agreement meant to specifically improve trading relations between the U.S. and major Chinese trading partners, isolating China. Biden is also not great on trade, but has emphasized that he will push China on human rights, not soybean purchases.
I’ve also mentioned in the past that a huge advantage the U.S. has over China is our ability to take in new immigrants and turn them into Americans, and this is doubly true for skilled Chinese immigrants who often attend American universities. Yet the Trump administration has attacked legal immigration (even more so during the pandemic), making it harder for America to exercise an important asset in any long term disagreements with China.
Comparatively, Joe Biden is simply not that extreme. He’s been a fairly middle-of-the-road Democrat since the Bronze Age. Of course, that does means he’s voted for the Iraq War and was part of the Obama administrations’ intervention in Libya, but Donald Trump also supported the Iraq War, although he only wanted to go into Libya “if we take the oil” (?). Donald Trump has notably strengthened relationships with Israel, but Israel has little sway over China and Russia. Meanwhile, traditional important allies have been shunned.
Donald Trump is dangerous. A cold war with China is not inevitable, and a military arms race with modern technology, AI, and advanced genetics added on top of nuclear weapons is a recipe for absolute disaster. Even a small percentage increase in this risk through mismanagement could be worth millions of lives. The U.S. needs to work with our allies to confront China where necessary and work with the Chinese government to improve transparency and understanding between our two nations, while promoting human rights. Being President of the United States should perfectly position someone to make the case for freedom, free markets, and democracy against an authoritarian regime, but Trump has failed to do so, and his bad policy here should disqualify conservatives from backing him.
COVID-19 and Catastrophic Risk
This is an expansion of risk assessment from the Great Power Relations section and from the discussion in May. Catastrophic risk management is underfunded and underprioritized. We should be preparing for the next pandemic, the next earthquake, and so on. Neither candidate has really called for comprehensive congressional action on establishing better risk management, so let’s focus on COVID-19, which remains a key issue.
The U.S. has worse per capita deaths than a wide cross section of developed countries including Italy, France, and the broad EU. Germany, Canada, and Japan have rates several times lower. The U.S. rate is similar to the U.K. but is on a much higher trajectory, similar to Mexico. At best, we’re average, at worst, we are the most advanced country to still have out of control cases.
Trump revamped his National Security Council, including removing several people who were part of pandemic preparedness, altering the pandemic response policy set up under Obama. John Bolton claimed this was a cost-saving measure and allowed for better implementation of policy. Whatever the case, there’s no one to blame except Trump; he reorganized his bureaucracy in the way he wanted, and this was the policy result we got. He is also ultimately in charge of the FDA and CDC and as we discussed in April, those agencies had colossal failures. Moreover, Trump publicly discussed how COVID was not a problem, saying in February the number of cases “within a couple of days is going to be down to close to zero.” Meanwhile, he was telling reporter Carl Bernstein that this virus was extremely serious and deadly in February, and that he had purposefully played it down to avoid a panic. Regardless of morality, this is simply bad policy and cost American lives.
Trump should absolutely get credit for shutting down travel from China earlier than many people wanted. However, instead of acknowledging that any policy could only delay and not prevent a full outbreak, Trump then spent all of February downplaying the virus like it wasn’t a threat. Instead, given his apparent understanding of the challenge, he should have been issuing government guarantees to purchase masks, creating guidelines for how to reduce spread, encouraging indoor sporting events and concerts to consider cancelling, and more. We know much more about this virus now than we did in March. Delaying the peak from April to June or July could have saved literally thousands of lives.
As of September 28, the CDC estimates 208,000 – 274,000 excess deaths in the U.S. since February 1, with Metaculus estimating between 220,000 and 360,000 U.S. deaths from COVID this year. This is an unmitigated catastrophe. Not every death can be attributed to Trump’s policies, but we have plenty of evidence that his policies could be considerably better. Other developed countries have death rates a fraction of ours, and Trump has constantly made poor decisions, downplayed the virus compared to the flu, encouraged supporters not to wear masks. At this point, even small policy shifts that reduced the death toll by 10% would have saved 20,000 lives. Conservatives must hold the president accountable for failing to protect American lives.
Congressional vs Executive Power
The functionality of the U.S. government as a system for creating and executing policy affects every other policy. In particular is the glaring problems of congressional mismanagement and executive overreach. Unfortunately, both Trump and Biden have poor records, although Trump may be worse.
Conservatives ought to be concerned about the power of the executive and the reduced role Congress has played in policy-making. Moving away from a consensus building model in Congress to a winner-take-all super executive elected every four years to do anything they want is a bad idea for many reasons. For one this increases the stakes at every election and thus increased polarization. It also means more power concentrated more centrally, which conservatives should be quite skeptical of, and at least many were under Obama. And finally, there are specific things that conservatives want the government to do, like maintain a strong national defense. If we continue to pile responsibilities on the President without involving Congress or actual legislation, then our national defense relies solely on the whims of one person, who you might not trust.
I’ve criticized the Obama administration significantly on executive overreach, and Joe Biden was part of that administration. Obama invented the concept of unauthorized drone wars, complete with secret kill lists, including American citizens. Yet, Gene Healy details how Trump has essentially expanded on Obama’s work in every way, including civilian casualties, all under the guise of the 2001 Authorization of Use of Military Force against the perpetrators of 9/11, even nine years after Osama Bin Laden’s death. He also bombed Syria under a separate claim of pure executive war powers which has no constitutional basis, and this year unilaterally targeted a member of the Iranian government (and a bad person) without any congressional authority. This is an unprecedented use of presidential authority to wage war, and blatant disregard of the constitution. In an absolutely insane reversal, Trump vetoed the war powers resolution passed by congress to reign in his authority. No constitutional conservative can defend this action.
Healy does note that many of the more aggressive uses of Trump’s executive power can’t be categorized as “new” power grabs; Congress had largely ceded those powers to the president even if no other president had actually used them. For example, the Supreme Court upheld a later iteration of Trump’s travel ban (although earlier ones were ruled unconstitutional), and although “there’s ample ground for disputing the Court’s decision”, Congress allowed the president to interpret national security powers quite broadly.
However, on trade, Trump clearly expanded executive authority by lying about Canadian steel imports being a national security threat. This broad interpretation of the law was again unprecedented and means that tariff levels are likely solely controllable by the president, which is an absurd constitutional farce; Congress should have the sole ability to pass tax law. Trump also declared a national emergency in order to fund his border wall after Congress repeatedly refused to allocate money (partially struck down in court). Trump needed to lead on these issues, make broad appeals to the political center, and put pressure on Congress — which Republicans controlled for two years! Instead, he failed and fell back on executive orders which fly in the face of conservative small government beliefs.
For his part, Biden has not offered to fund a border wall through executive authority, so I guess point to him. On the other hand, Biden indicated he thought FEMA should be leveraged (and presumably a national emergency declared) to fund K-12 schools due to coronavirus challenges. Again, to be consistent, school funding from the federal government really ought to come from Congress, not executive authority.
Alright, now let’s touch on impeachment. If you want my full thoughts, read this post here. In summary, regardless of legality, Trump held up Congressionally authorized funds for political purposes, trying to get dirt on his enemies. From the perspective of concerns about executive power, this is wrong, and conservatives should be terrified of progressives getting into office and doing exactly what Trump did. We need to deescalate using the state as a political weapon; Trump is not deescalating.
Of course, no one is talking about what I actually wrote about in May, which was a resurgent Congress, not just a presidency that maybe didn’t quite expand executive authority as much as before. So I think overall the most important long term affects on congressional and executive power are worse with Trump, but they’re not night and day. Something like Trump gets an F and Biden gets a D.
Liberalizing Immigration
Conservatives and I may be far apart on this issue, but I think there is some common ground. The United States has perhaps the longest and most well known history of immigration of any nation on earth, and we all agree some immigration will continue to occur. Given that immigration will continue, we can also agree that an improved system is needed; current immigration rules favor family migration instead of merit and skill. We should change our immigration system to focus more on skilled immigrants, or on retaining students who pay to be educated at the best institutions and then seek to work in the most technologically advanced and dynamic large economy in the world.
Improving our immigration system to be more merit based would be a huge boon to our free market system, to our national security, to our global influence, and of course, would result in more Americans. We want the smartest people in the world to move here and innovate on the cutting edge. If we shut our doors, those people will go to other countries, and we will lose a massive advantage we have over places like China, which, as self declared ethno-states, simply cannot attract diverse talent from across the world.
Yet Donald Trump has slashed legal immigration and made it significantly harder for skilled immigrants to enter the country, or even apply for green cards. Both green card and temporary visa applications decreased 17% each between 2016 and 2019 while rules for granting green cards were narrowed. He even banned any new H-1B visas, which focus on high skilled, high earning immigrants (who are great for innovation) for the rest of this year through executive order. Given pandemic related issues are likely to continue into next year, I wouldn’t be surprised if this continued past December.
Given these extraordinary actions, particularly during the pandemic, I would estimate a Trump second term could see a million fewer legal immigrants than a Biden term. This would have long term negative effects on the U.S. economy, not to mention on those immigrants who literally want to be Americans. Trump has also shown no ability to work with Congress on reforming the immigration system, instead working through executive unilateral action.
Biden has planned to reverse most of Trump’s immigration policies. I’ve emphasized the horrific impact on high skilled immigration, but Biden focuses on more liberal talking points, particularly about children of illegal immigrants and refugees. Trump has absolutely crushed the number of refugees the U.S. has taken, thwarting a long standing Cold War era policy. While conservatives may be skeptical of the benefits of refugees (recent data shows they contribute positively to the economy), the geopolitical benefits of being a destination for refugees are clearly all positive. No refugee is picking Russia over the U.S., for example. Unfortunately, Trump has crippled that rhetorical win.
Finally on illegal immigration, I think it’s undeniable that Trump is harder on illegal immigration than Biden would be. However, I must stress that concerns about illegal immigration are often overblown by conservatives. Although caution is warranted, it’s likely that illegal immigrants are less likely to be criminals than native born Americans. Moreover, Trump has focused on things like building a border wall (which he claimed Mexico would pay for) which the OIG found did not utilize a “sound, well-documented methodology” for where the wall would actually be built. Also, many illegal immigrants cross the border at regular checkpoints and simply overstay their visa. Additionally, the administration spent lots of effort noticeably separating young children from their parents at the border rather than on improving the infrastructure in place for immigration courts, which would actually improve the rate at which the government could deport immigrants.
Trump’s policy of harsher, haphazard (and quite frankly idiotic) illegal immigration enforcement at the cost of harming legal immigration and thwarting the American economy’s ability to integrate foreign skilled labor is simply not worth the trade off.
Housing Policy
Deregulating housing policy, especially in “blue” cities like New York and San Francisco is a key measure needed to help grow the American economy. Housing is one of the largest expenses most Americans have, yet it wasn’t always the case. Restrictive zoning has made housing exceedingly unaffordable, and conservatives ought to defend the right of property owners to do what they want on their own property. Trump actually supported deregulation ideas early on in his presidency, and then this year abruptly switched tactics to favor stronger regulation. This is anti-free market and anti economic growth. These large cities have made it harder to build new housing, which causes housing costs to rise, homelessness to increase, and the young and poor to be priced out of good opportunities. Mobility is down across the country, companies are struggling to attract employees to these high cost areas, and many are leaving. Trump is supporting this.
Network effects mean more concentrated, dense cities are much better. For example, recreating the networks that made Silicon Valley in other places is quite difficult, but as regulations make it harder to live in the Bay Area, we are forced to rebuild the aspects of the Bay Area in other places, which wastes time and energy. The same applies to every expensive U.S. city, including Boston, DC, LA, and Miami. The costs involved are astronomical, amounting to tens of trillions of dollars in lost economic productivity over years.
Biden’s housing policy is actually remarkably thoughtful and deregulatory. He proposes improving the already existing federal rental housing assistance for low income families so that all who qualify can obtain it (right now it gives out money to families until a set amount is given out instead of to all who qualify). Then he pairs that with requirements on federal housing money where municipalities must reduce zoning rules that block new housing. Obviously it’s difficult to know to what extent these policies will be exactly implemented, but if a policy even close to what Biden has proposed were to be passed, it would be a solid boon to economic growth. Moreover, it stands a good chance as it’s moderate and compromising where Trump’s housing policy.…isn’t.
Additional Issues
These issues are either where the candidates differ little, or conservatives don’t often prioritize so I’ve kept them short. Nonetheless, Biden retains an edge on these issues.
Climate Change
Many conservatives are skeptical of climate change. I found a view articulated by Russ Roberts, host of EconTalk, to be illuminating. Like nuclear war or pandemics, climate change is a risk with unknown probability. Rather than binary choice of preparing for it or not, our climate policy should weight the various catastrophic effects with the probabilities. Even if conservatives find the most dire climate predictions unlikely, some action is likely warranted under standard economic theory; negative externalities like pollution ought to be taxed. And as we’ve seen this year, it’s bad policy to shirk preparations until the catastrophe is already upon you.
Carbon taxes with offsetting tax cuts seem pretty straightforward. The Paris Climate agreement also seemed like an easy win, with countries setting their own targets. Trump’s withdrawal from this agreement seems to involve no policy calculation whatsoever since the agreement wasn’t binding anyway.
Biden’s plan is a bit aggressive for my take. It goes beyond taxing externalities and into specific government spending. Of course, Donald Trump has spent boatloads of money and would likely continue that trend. Biden spending money on green energy doesn’t seem any worse than Trump spending money on…everything. Donald Trump’s plan to do nothing about climate change seems more negative.
Fed Independence
This hasn’t turned out to be much of an issue as the Fed has been extremely active this year and we have yet to see inflation rise. Nonetheless, Donald Trump’s continued insistence that the Fed cut interest rates even as the economy was well below 5% unemployment was clearly political rather than based on any actual economic theory. This should be condemned as bad policy. Central banking should remain independent and not subject to the whims of populist rulers unless you want to be Venezuela.
Trade
Trade can have large positive impacts on the world, although trade barriers had been pretty low. The highest impact policies would be to use trade to improve relations with liberal countries and tie economic success of the U.S. to a broad liberal coalition to counter China. This is what the TPP and TTIP were, both abandoned by Trump. This is bad, free market conservatives should oppose Trump here, but Biden is not particularly free trade either.
Criminal Justice and the War on Drugs
I listed this as a large and important issue in May. However, the extent to which Trump and Biden differ on drug legalization is small. Both have expressed some interest in decriminalizing marijuana. I’m slightly more inclined to believe Biden as he has stayed with the median of the democratic party, which has largely embraced the issue, meanwhile Trump has been president for four years and done little. In overall criminal justice, democrats have as slight edge. Biden has expressed moderate views in the face of radical segments of his party, calling for reform, but also opposing calls to defund the police. Trump’s rhetoric has been rather aggressively anti-reform, but his actual policy actions seem to be small.
Counterpoints
Taxes
Joe Biden wants higher taxes than Trump. I’m against this. But I remain more positive on Biden than on Trump because of the relative weight of issue impacts. Joe Biden is not suggesting a systemic reinvention of taxation where billionaires are banned, but rather a higher level of taxation than before. I don’t know the exact details, but I would guess this would cost the American economy hundreds of billions, possibly a trillion dollars over four years. That’s pretty bad, but in a moment I’ll do a cost-benefit analysis and see how it compares.
Healthcare
I think conservatives have a strong case that Trump is better than Biden on healthcare policy, given conservative policy preferences. However, the differences are small. Trump had the opportunity to overhaul the healthcare system with a united Republican government in 2017. He provided no leadership and accomplished nothing except the repeal of the individual mandate on people who did not purchase insurance; that’s fine, but the problems in American healthcare are systemic and remain.
Joe Biden would not institute the aggressive Medicare-for-all plans of Bernie Sanders, but instead wants to create a public option. This is not a free market approach, but could actually be a good starting point to disentangle healthcare from employment. A Republican compromise that added a public option for people to buy while also reducing the mandates on what coverage employers have to provide to employees could get more people covered while also reducing reliance on employment for healthcare (which never made any sense anyway and distorts the labor market). Nonetheless, Trump could obviously try and make headway on such a system without the public option and without Biden as president, but he hasn’t. He’s mostly ignored this issue for several years.
Overall, for conservatives, I think the options are either doing nothing with a currently broken system, or see slightly worse reforms that tend to go in the wrong direction, but won’t be the end of the world. Compared to the vast differences in foreign policy, COVID-19 management, immigration, and housing policy, this just doesn’t make a dent on the enormous lead Biden has on Trump.
Justices
This is likely Trump’s biggest strength compared to Biden, however, there are some mitigating circumstances. The major one is that there are no conservative justices poised to retire soon. Clarence Thomas is 72, but many justices retire after 80. Another is that Supreme Court justices aren’t nearly as partisan as other members of the government. Many cases are decided unanimously, and many justices commonly rule against their “party” to uphold precedent. When justices do split, it’s not always clear what the lines will be. Gorsuch and Sotomayor are both strong proponents of 4th Amendment protections despite being appointed by different parties. Anthony Kennedy, despite being appointed by Reagan, was part of the majority in Kelo v New London. This ruled that state governments could seize private property and give it to private developers, which, and I can’t emphasize this enough, was outrageous. 45 states eventually passed legislation banning Kelo-like eminent domain seizures.
Which brings up another point: Congress can make laws. Remember all the debate about the Supreme Court ruling whether the President could implement his immigration bans in 2017? None of that would have mattered if Congress had simply clarified the law, and Republicans held both chambers! The level of intensity we have dedicated to Supreme Court appointments is encouraged by Congress’ inaction. We can either respond by pushing harder on court appointments, or we can respond by focusing on Congress!
Yes, appointing good justices matters, and Neil Gorsuch is an excellent justice! But we overemphasize the importance in Supreme Court nominations, and compared to the other issues that are costing thousands of American lives, this issue isn’t enough for Trump.
The Big Picture
When it comes down to it, Biden’s tax policy is not what I want, but it’s not going to have a lasting impact on the economy. Future Republican presidents can come in and fix marginal tax rates. Trump’s housing policy will cause long term harm relative to Biden’s. The reduction in cost of living for Americans if we can properly regulate construction of new homes in cities far outweighs any tax cut and brings in network effects on American cities. Cities are the currency of the economy. To see how behind we are, look at Tokyo where in 2018 more housing units were added than in New York, Boston, Houston, and Los Angeles combined. Trump wants that trend to continue, Biden doesn’t.
Add in Trump’s growth-crushing legal immigration policy, and the choice is even more stark.
Healthcare is another area where I don’t endorse Biden’s policy. But as stated, Trump has essentially nothing to offer here despite being president for four years. From a conservative perspective, at worst, Biden could implement a public option. Note however, this leaves private insurance completely intact. There is simply not a systemic risk conservatives should worry about. U.S. healthcare already has tons of government interventions and increasing government spending in healthcare 20% isn’t good, but it’s not going to be the end of America. It will put a strain on federal government finances, but Trump has consistently demonstrated that he does not care about that issue at all.
On the other hand, Trump’s actual policy when it comes to an actual pandemic has literally resulted in 200,000 dead Americans. Again, not all of this is on Trump, but it seems plausible that his downplaying of the virus, his bungling of agency responses, and his actual rallies during the pandemic has resulted in avoidable deaths. We cannot risk another catastrophe.
Finally, there’s the question of justices. To me this seems most comparable to the long term future concerns from the Greater Power Relations section. Both issues are concerning because of their impact on the trajectory of the long term future, but one is simply much higher stakes than the other. How the U.S. manages our relationship with China determines the course of human history in this century. If we screw it up badly, millions of lives are on the line. On the other hand, if Biden is elected, he might replace Stephen Breyer with another liberal leaning justice, and as stated previously, the overall impact here is smaller than most conservatives make it out to be.
I’ve detailed the importance of how we manage geopolitics and the dangers inherent on the global stage today as they impact the long term future. Arms races are extraordinarily dangerous, and in the future humanity’s weapons will only get more powerful. Trump has not managed geopolitics well. When the COVID-19 catastrophe hit, he was again subpar and his policy was not up the task of protecting Americans. Add in his poor economic policy on housing and immigration, throw in even a fleeting concern about climate change, and the evidence against Trump’s policies in favor of Biden’s is overwhelming.
Of course, I haven’t even got to some of the most devastating critiques of Trump, since I specifically tried to avoid discussions outside of policy. However, next post, I do want to cover, if it’s even possible, all of the Trump administration’s vast corruption, gross incompetence, authoritarian acts, and his divisive and polarizing approach to politics. I think much of this “extracurricular” activity matters a great deal even though some Trump supporters may brush it aside as trolling or just politics. But even if I’m wrong, Trump’s policy record is terrible enough on its own.
A Note on the LP Candidate
I didn’t want to take too much away from the more outcome oriented discussion of the Trump and Biden, one of whom is going to win the November election. However, as I noted in my last post, many readers will not be voting in a swing state, and so may be interested in the Libertarian Party candidate Jo Jorgensen.
Her policies do reasonably well on my list of issues (not very surprising on a blog about libertarianism and politics), and since non-swing state voters have essentially no chance to impact the election, libertarian leaning voters could cast their ballot for someone they actually like without worrying about electing the worse major party candidate. Very briefly, she hasn’t impressed on the issues of great power relations and catastrophic risks, two important issues. These tend not be libertarian strengths, so that makes sense, although I maintain they are key to the long term future of the world and the U.S.
On executive power, immigration, trade, criminal justice, and taxes, Jorgensen is reiterating the standard LP positions, which are generally pretty good as far as this libertarian leaning blog is concerned. I am surprised by her lack of discussion of housing deregulation (at least I couldn’t find anything) given it’s such a key issue, as standard libertarian positions should be positive here. On healthcare, I would take more incremental steps than she would. Overall, if you’re libertarian leaning and you don’t live in a swing state, I think voting for Jorgensen or Biden are defensible positions. If you want to learn more about Jorgensen’s positions, check out her ISideWith page and website.
It’s election season so it’s time to start talking electoral politics again. The Trump administration has been particularly successful in ignoring policy discussions in favor of political point scoring. This isn’t too surprising given Trump’s lack of consistent ideology, apart from perhaps opposition to free trade and immigration. Impeachment has also helped focus attention on Trump’s political situation rather than his policies or lack thereof. Don’t get me wrong, I think there is a strong non-policy case against Trump, and I think in particular Congressman Justin Amash has done an excellent job in articulating why Trump’s behavior is concerning.
However, I think there is also a policy-based critique of Trump. In order to properly make that case and compare Trump’s policies to Biden’s or other candidates, we must establish a foundation declaring which problems are most important, and what policies could be used to implement them. Criteria for these policy ideals include some utilitarian calculus, i.e., how to improve the lives of the most people in the largest way. Thus, the first of these policies is actually a meta-policy, a way to improve congressional power to pass laws and run the state. Changing the way we make policy can affect all of our future policy making.
Countering this interest in utilitarian idealism is a preference for some political feasibility; in other words, while I might prefer to emphasize revolutionary changes that significantly improve the country (changing all of our voting systems to approval voting or quadratic voting or switching taxation to be based on land value), I’ve left them off this list because they are not just unpopular, but in fact virtually never discussed. If you find a particular policy interesting, please follow the links in that section for additional policy discussion and details.
Finally, there is uncertainty here, and I’ll mention other policies that didn’t make this list at the end. Trying to filter major talking points out of a broader range of political ideas is difficult. Policies and political philosophies are interconnected, and where I’m drawing boundaries must be arbitrary. Nonetheless, these ideas should form a good basis for uniformly judging candidate policies.
Congressional Power
Any policy platform has to address the fact that our current system for governance, for crafting and enacting policy, is deeply flawed. We have uncompetitive and broken elections, we have bad ways of choosing candidates, and we have too much power in the executive branch. Executive authority compounds our problems by making each election a stark singular choice between polarized sides instead of a well rounded government built on a legislature with many interests represented. I can’t fix all of these in this policy platform, so improving the balance between the president and Congress seems like a good place to start.
The entire budget for the legislative branch, including congressional staff, offices, and congressional agencies like the GAO and CBO, is about $5 billion. Congress is then responsible for oversight and legislative action for the entire $5 trillion federal government. The CBO has a mere 250 person staff, and it can’t even research and score all Congressional bills. This is absolute insanity.
Congress needs to be able to wield its muscle. It should not be relying on executive branch bureaucracies as unbiased experts evaluating their own performance. It should have a better staffed research arm which can oversee all aspects of the massive American bureaucracy. Congressmen also need to have more and more policy-focused positions on their own staff, along with fewer committee assignments. National Affairs has an excellent in depth discussion of the thinking behind this brief overview. Legislators are currently underpaid amateurs who spend half their time outside of Washington focused on other things besides governance. This does not allow for knowledgeable congressional oversight of the federal government.
Cato also has some excellent ideas for strengthening Congress such as having a standing committee to review executive overreaches from statutory law, and forcing votes on major rules as implemented by regulators or bureaucrats. Other ideas include expanding the congressional calendar, making a new Congressional Regulatory Service to oversee the regulations made by independent and executive agencies, and requiring all civil asset forfeitures to be deposited into the Treasury to be spent by Congress, not the executive.
Unfortunately, even despite a recent impeachment trial this is simply not a major political issue in this year’s campaign, and no candidate is running with strengthening Congress as a priority. In fact, there are essentially no meta-policy ideas being floated. Yet ideas are not hard to come by!
Liberalizing Immigration
The U.S. immigration system is terrible (see section 8 here). It is esoteric, slow, and requires a complete overhaul. It should have a focus on a merit-based system rather than nation-of-origin and family ties as it does now. It should be simpler for high-skilled workers to be hired by American companies and it should definitely be easier for young workers, educated at excellent American colleges, to be hired by American companies and remain in the United States where they can pay tax dollars for decades.
Why is this so high up on the list?
This is a matter of national security. China is a growing power, but crucially, it cannot expand its influence or economy through immigration. The Chinese state has largely decided that ethnicity matters, and China is not seeking to create a multicultural amalgamation to improve the world, but rather a nationalist state. The U.S. isn’t restricted in this way; anyone can be an American. Immigrants are also more likely to start businesses and take risks. That means the most creative and ambitious people in the world can come to the United States and contribute to our culture, knowledge, technology, and wealth. Moreover, these remarkable people already want to come here. Increased dynamism and economic growth also makes the rest of our geopolitical challenges easier; it means the national debt is less of a burden, and national defense spending can be higher in absolute terms while costing less of a percentage of GDP.
This is also perhaps the best and simplest way to improve the world quickly. It’s extremely difficult to improve nations with poor institutions, yet people who struggle in developing nations can be immediately more productive if they are transplanted to the U.S. And of course many are quite willing to do so, uprooting their entire lives for a chance at the American Dream. We can pursue limitations on their access to public money, or a simple tax upon immigrating, but nonetheless we should be voting to improve the world in the most altruistic and nationalistic way possible: expanding legal immigration in order to make more Americans!
Federal Incentives to Build More Housing in U.S. Cities
This is a specific policy taken from the Niskanen Center’s Will Wilkinson. Cited on this blog before, he suggests giving federal money to urban areas that add large amounts of new housing stock. Why? Because American cities are absurdly expensive to live in, yet new housing is extremely difficult to develop due to overregulation and zoning laws.
The impact of our poor housing policy is enormous. Economists suggest housing constraints have lowered U.S. GDP by as much as a third over the last 50 years. Think about that. We could be missing a third of GDP because millions of people who wanted to move somewhere for a better job couldn’t find a place to live. It’s clear that the most productive areas in the U.S., especially cities like New York and San Francisco, are prohibitively expensive, keeping out potential new productive workers.
Wilkinson’s suggestion isn’t the only possible policy solution; another is to change zoning to be hyper local, composed by residents of a single street or city block. This would allow experimentation and innovation, instead of immovable local land interests which keep out future non-residents who can’t vote in today’s elections.
While the viable solutions are still up for the debate, the impact is clear: the lack of housing development in U.S. cities due to overregulation may be the single greatest barrier to economic growth, thus earning its inclusion on this short list of policies.
Decriminalization of All Drugs
Ever since Pete Buttigieg announced his support for this policy, I’ve had it circled for inclusion on this list. The War on Drugs has been a colossal failure, has not reduced drug use, and has radically increased prison populations. There have been extraordinary costs to the taxpayer in both civil liberties and assets. Massive application of state force has helped to give a monopoly in funding to the most bloodthirsty and gruesome organized criminal elements in the world, including terrorists. There have even been spillover effects as governments crack down on prescription pain killers, leaving patients in agony.
This policy is wrong morally, practically, and economically. It is not the place of the state to determine what substances informed adults can consume or inject. It is also abundantly clear the state has zero capability to halt the trade or consumption of drugs. Rather, enforcement of drug laws have bolstered a black market where information is asymmetric and scarce, endangering all involved. The only thing the state has succeeded in doing is making organized crime more financially viable. The resulting conflict in Mexico has killed over 150,000 people, making it one of the largest conflicts of the 21st century behind only the Iraq War, Syrian Civil War, and Darfur. It is this monstrous loss of human life as a result of changeable government policy that places this item so high on this list.
And of course it goes without saying that this massive assistance to organized crime is occurring at great financial cost. Estimates for enforcement, prosecution, incarceration, and military interventions are as high as $50 billion a year. State prohibition of private mutually consensual transactions also requires erosion of our rights in ways that frustrate measures of concrete financial cost. The ACLU notes extensive surveillance has been justified under the guise of drug enforcement while increasingly militarized police forces have abused their power to break into homes unannounced or preemptively shoot victims all in the name of stopping transactions among consenting adults. It’s time to end this failed policy.
Catastrophic Risk
It’s clear today that the federal government does not respond well to large disasters. Perhaps too much relies upon the whims of the executive who happens to be in power, but it seems likely that we could institutionalize better responses to catastrophic events. Yes, this includes pandemics, but also major earthquakes, solar flares, artificial intelligence, and even plans for averting nuclear war (for a more detailed analysis, read Toby Ord’s recent book, The Precipice).
This is a highly neglected problem and thus one of the highest impact policies we could undertake (climate change could go here, but it has not been quite as neglected a topic as other risks, so I’ve detailed it later). At the beginning of 2020, I would not have included this in the list of top policies, not because it was low impact, but simply due to the fact that it was not discussed as a major political issue. The failings of the federal government to respond to a deadly virus have pushed catastrophic risks into the mainstream. While the likelihood of any given catastrophe is low, it is the enormous impact of the tail-risk that should concern us; preparing now will mean the difference between devastation and mere hardship.
We should look to create public commissions to investigate our preparedness for various catastrophic events, identify what can be done now for relatively small budgets with larger payoffs when a disaster comes, and then pass legislation that enshrines this knowledge institutionally in ways that do not rely on the whims and competence of whomever happens to be president. It is vital that any commissions include our preparedness for other challenges besides pandemics; preparedness for unexpected events is not selected through democratic pressures, and perhaps this has resulted in our current difficult situation with COVID-19. It would be wise to use this opportunity to prepare not just for the next viral outbreak, but for other unlikely events as well.
Other Topics
There are arguments for inclusion of a lot more policies. I’ll run through several more quickly.
It matters a lot who the president appoints to the Federal Reserve, and that they are extensively qualified and independent. I’ve left it off of this list mostly because we’ve lucked out and it seems Trump’s appointments haven’t been that different from normal. When odd choices were floated, they were largely quashed. Independence is obviously still at risk with the president tweeting criticism of his own appointees, so this issue shouldn’t be overlooked, but given that I treat it like a pass/fail grade, we can reasonably hope this will be a “pass” for all candidates in 2020. I wish I could say that more definitively, but I can’t.
Healthcare is a huge part of the federal budget and has an outsized impact on the economy. We also don’t have great solutions, but this is another issue that could easily have made the list. The most important aspects are stopping reliance on employers providing health insurance (which makes it much harder for workers to take risks and switch jobs), and expanding coverage for the least well-off. How we do that is difficult to answer in such a small space, but I’m wary of radical changes that seek to quickly re-imagine the U.S. healthcare industry from the top down.
Climate change is a potentially expensive disaster waiting to happen. If the past months have taught us anything, waiting for disasters to happen is not the correct strategy. Instituting a small carbon tax seems like a good place to start. It can be refunded to taxpayers equally, or even made to incentivize carbon sequestration programs with refundable tax credits for carbon taken from the atmosphere.
Free trade has had a massive impact on reducing poverty worldwide, while also improving the economies of all countries around the world. There’s also some evidence for reduced chances of wars between important trading partners. Aligning American and Chinese commercial interests through trade will be a vital part of avoiding a war between these world powers. Free trade is also a vital vehicle for continuing the pattern of global poverty reduction seen in the last 30 years.
U.S. interventions in the Middle East have been one of the largest contributors to excess deaths from U.S. policy. Obviously there is high uncertainty over whether many conflicts would have continued even without American intervention, but that seems unlikely in at least a couple large instances (the Iraq War being the biggest one). U.S. support of regimes like Saudi Arabia also seems to show negative payoffs from a humanitarian calculus. It also does not seem that larger 21st century goals like opposing authoritarianism in China and avoiding large scale wars are served through Middle Eastern interventions.
Candidates’ Priorities Matter Too
While this is a nice policy platform, ultimately the goal is to judge candidates by their relationship with these policies.
A major problem for this approach of separating out policies isn’t that most people running for office oppose these positions, but that they might be indifferent or even positive on these high impact policies while still focusing on other completely radical ideas. Elizabeth Warren’s many proposals come to mind here. There are some meritorious critiques in Warren’s proposals; competition is vital to a well functioning market, and some of her ideas could enhance competition. But many are far more radical with, at best, unknown effects on competition and the economy generally. These include the eradication of private equity, the changing of corporate boards, and an unprecedentedly large wealth tax which could significantly curtail investment. If Warren scored highly on the top policies put forward here (she does alright on immigration, housing, and drug policy), how do we balance that with the relatively radical (and I’d argue unhelpful) economic proposals she made the centerpiece of her campaign?
Unfortunately, we have to take those points seriously and note that while I have tried to rank these policies in a somewhat utilitarian, impact- centered way (policies within the Overton Window that help the most people by the greatest amount), radical policies that backfire could have very high impacts that shove aside the ideas proposed here.
There is a lot of uncertainty that remains; some of these policies could be higher on the list, and I’ve likely excluded some that are high impact that have not yet occurred to me. Major policies could matter in the future that we just haven’t encountered. And of course these are only policy preferences; as noted in my last post, simple competency is an important factor as well. Despite all of these caveats, this an important step in laying a foundation of policy discussion and analysis against which we can measure candidates. Electoral politics is messy and tribal; discussions confound concise and consistent frameworks, but when they do swerve towards policy, these points should help form the questions that need to be asked.
Immigration liberalization is one of the policies this blog has described as highest impact. It could have massive benefits to both immigrants and native born citizens in the United States and other developed countries. Immigration bypasses the need to solve the extremely difficult problem of “building good institutions” which is a mercurial and sparsely solved goal in development. By moving people directly to societies where good institutions already exist, we don’t have to make them. OpenBorders.info also suggests free movement of people could double world GDP, with smaller migration seeing proportionally smaller but still substantial growth.
The United States is uniquely positioned to absorb immigration. It is the largest developed country by both population and GDP by significant margins (developed country referring to either OECD member or country with HDI > 0.8). By nominal GDP the US economy remains the largest in the world, and by PPP it is second only to China. Unlike China, the US is the only large country with a large foreign born population, and indeed the US has the largest foreign born population in the world at over 46 million. The US also has a long history of immigration contributing to its excellent position as an immigration destination.
Given this blogs inclination towards the benefits of markets, self determination, and individual rights, our default position should be in support of more liberalized immigration. Current immigration policy is geared towards family connections despite much of the potential benefits of immigration stemming from economics. The U.S. also takes in less immigrants as a percentage of its population than other developed nations, despite the previously mentioned advantages the U.S. has in absorbing immigration.
Originating from economist Gary Becker, an immigration tariff would allow prospective immigrants to pay a tax or fee to enter the country and work. We have a somewhat similar although highly limited current system with H-1B visas which are sponsored by companies for employees. Expanding this and accounting for age and level of education, Congress could create a tariff schedule for various immigrants based on potential costs and tax revenue from these immigrants. They could also simply sell off additional green cards after the current legal green card approaches were filled in the current year. The Cato paper linked goes into more detail.
The benefits of any such system would be to guarantee that immigrants with the skills and ability to work productively in the United States would be able to do so, with additional monetary compensation provided up front to the U.S. to avoid any potential risk of those immigrants becoming a net cost on society. This would see benefits in terms of additional labor, entrepreneurship, and economic growth.
The issue with this approach is that immigration is a highly divisive political issue. Republicans would be unlikely to embrace this proposal due to their base’s opposition to apparently all immigration. Democrats may be more interested, but may balk at the notion of people “buying” their way to the front of the line.
The entirety of the openborders.info site offers substantial arguments to the benefits of open borders, and virtually all arguments they make apply to marginal immigration liberalization as well.
Libertarians are not fans of wars or government spending, often for overlapping reasons. Consequently, libertarians often remain uninterested in foreign policy, writing off the entire area of study as something not worth engaging in. Given the current administration has found a way to be both not interested in global affairs (“America First“), while also highly anti-market and pro-government spending (especially defense spending), I believe there might be an alternative that both retains a small government approach to the economy, as well as an important role for American leadership in the world.
The overarching theme here is that China is a rising power, whose outlook is distinct from that of the U.S. and the liberal world order generally. We might have expected China to continue its trajectory towards a freer economy and perhaps even a freer political ideology even 10 years ago, but no longer. Economic reforms touted by Xi Jinping have not materialized, and in fact the Chinese Communist Party and the state have strengthened their hold on the economy and the role of state owned enterprises within it. The Chinese state has maintained a highly nationalistic ideology; American foreign policy has created plenty of messes, but has also done some good in promoting free trade and at least stated goals democracy and respect for human rights. China is looking to offer an alternative to the current American-dominated world, and it is likely one that is worse for the world. American policymakers need to do better. Here are ways they could do so.
Institute Fiscal Discipline
The first point is that any potential policy that looks to achieve American goals vs Chinese goals will cost money. The U.S. government had a deficit of $665 billion last year. This year it will probably exceed $1 trillion. Entitlement spending will cost money, military R&D will cost money, cybersecurity will cost money, projecting power near China will cost money. Yet, we have passed a massive tax cut with no way to pay for it. From a libertarian perspective, unfunded tax cuts could be argued either way; they reduce the tax burden on citizens, but they crowd out investment, don’t actually change the amount of government interference in the economy, and they could lead to higher taxes later on. But from a national security perspective, this fiscal policy is terrifyingly irresponsible.
I find it uninteresting who owns the national debt. Much has been made of the fact that the Chinese government owns large portions of our debt. So what? They will receive future interest payments, but the federal government received cash from outside the U.S. economy it could spend immediately. That kept interest rates low in the U.S. while Chinese savings and taxes were taken by the U.S. government and used to pay for Medicare, Social Security, and the War in Iraq. This is just a trade and doesn’t even seem like a great investment from China’s perspective. China could dump its American debt holdings onto the market, pushing up interest rates in the U.S., but by flooding the market, they’d also be selling the debt at a discount, writing off the losses. Moreover, China only owns a bit over a trillion dollars of debt, compared to the national debt’s total size of almost $21 trillion.
China could have put that capital directly into infrastructure investment or education or buying off communist party officials to implement more complete market reforms or even malaria nets in sub-Saharan Africa! But instead they bought low yield American government bonds. Seems like a waste of capital in my opinion. Had China not purchased that debt, the federal government still would have issued it, but interest rates would have been higher. On the other hand, the fact that the treasury owes some of this debt to other entities in the government isn’t super comforting. Those government agencies need the cash too; if they aren’t paid, they won’t be functioning, and their employees won’t be working.
No matter who owns our debt, increases in interest payments, whether through interest rate rises or increases in the underlying total debt will make accomplishing any policy goals, including foreign policy, that much more difficult.
Stop Military Counter-Terrorist Interventions
Predictable point of any libertarian foreign policy critique? Yes, but it’s unfortunately unavoidable. The cost of the Iraq and Afghanistan Wars are hard to calculate exactly. Direct appropriations costs were over $1 trillion, but the Afghanistan War remains ongoing (are you sick of winning?). Long term costs including veterans benefits will probably be more than double the direct costs.
The U.S. has a long history of Middle East interventions, and they just don’t have much to show. There are still almost no democracies, Libya, Syria, and Yemen are still divided states living under various governments, Iraq has been suffering under a war with the Islamic State which has cost a hundred thousand lives and displaced millions. The Iranian nuclear deal prevented a theocratic autocracy from obtaining a nuclear weapon, which was said to be only a couple years away. This would be one of the only bright spots in U.S. policy in the Middle East, yet the President has threatened to tear up the deal.
If China is to be the focus of an American foreign policy, we can no longer afford to sink resources into fighting small terrorist groups that kill 10 times fewer Americans per year than police officers. And despite Trump’s so-called “America First” approach, we are most certainly still wasting resources in the Middle East. The President has carried out operations in Syria, Iraq, Yemen, Afghanistan, Pakistan, Somalia, and Libya. There are also U.S. forces apparently in Niger, Chad, and Cameroon. Perhaps it’s too late, and China’s expanding influence means the U.S. has to maintain a military presence in developing countries around the world to offer an alternative, but it would have been nice to save those expenditures in the intervening 30 years between the end of the Soviet Cold War and the ratcheting up of whatever this new one is. As it is now, these interventions have left American foreign policy broke.
Reform the Military Budget
As (grudgingly) stated earlier, we will need to fund the Department of Defense if our goal is to geopolitically confront China. Nonetheless, the DoD budget needs serious reform, and perhaps should be torn down and rebuilt from the ground up. The Government Accountability Office (the best government office) has never been able to audit the DoD in over 20 years (see page 3). In 2010, Congress told the DoD it had seven years to get its act together and finances in order. It missed the deadline. This year, the Department will allegedly finally undergo an audit, the report to be released November 15. This is, of course, a step in the right direction, but we need so much more.
The procurement system in the DoD is a complete mess. The F-35 fighter is way behind schedule and already $400 billion in. Last year, Lockheed Martin produced 66 planes. This exposé from 2014 is deeply disturbing. When the military isn’t pouring money into contractors who are making out like bandits, or paying for tanks it no longer wants nor needs, or blowing up perfectly usable munitions because it can’t keep track of what is needed and where it should go, it dumps its extra assets, including leaving thousands of humvees in Iraq that were eventually captured by the Islamic State.
This military budget needs a reckoning and I’m unsure Trump is up to the task.
Promote Free Trade
China is jumping off the free market ride, and the U.S. needs to pick up the slack. The best way to expand the benefits of markets is to expand markets themselves through trade. More to the point of this post, countries that have a stake in global trade and free movement of goods are much more likely to have economic goals and values that align with the U.S. and its allies. During the Cold War, there was a strong alternative to capitalism and trade, and while most countries didn’t have a “choice”, many countries did exist outside of the free trade liberal market order pushed by the West. After the fall of the Soviet Union, that alternative largely dried up. Today, if you want to have a successful, rich country, freer trade and openness to foreign investment are vital steps to take.
China is much more open to trade and markets than the Soviet Union ever was. Nevertheless, any policies or goals where their motivations are less market oriented and more nationalistic would be exactly where they would differ with that of western values/free trade/liberal markets. This is evident in their extensive protection of Chinese industries and even in non-tariff barriers such as the Great Firewall. To the extent that China seeks to offer an alternative to the United States’ world order, they support protectionism and oppose free trade.
This means increasing trade and integration into the global economy of an allied (or possibly allied) country is the national security interest of the United States. A hypothetical Cuba that was highly integrated into the U.S. economy would be much less likely to be flirting (metaphorically I think) with Chinese dignitaries. The Trans-Pacific Partnership played exactly this geopolitical role, integrating Pacific countries’ economies with the U.S. and its allies, while leaving China on the outside. Yet Trump declared that we should leave the TPP as soon as he entered office, effectively siding against American national security and promoting China’s geopolitical goals.
Tying U.S. policy to free trade and global markets is powerful. It’s very difficult for a country to become rich and successful without at least selling their products on the global market. Access to the global market is thus in every country’s national interest. If U.S. policy is to have open trade, then the American economy will be highly integrated into the global market, meaning it is in the national interest of other countries to gain access to the American market. U.S. trade policy has been to offer access to the American market as part of bilateral and multi-lateral free trade agreements, thus offering foreign countries’ national interest goals if they conform with American goals of free trade and free markets. Integration with the U.S. economically necessitates geopolitical alignment with the U.S. That’s why it’s not just obviously economically stupid to oppose free trade (like crazy stupid), it’s against American national interests.
Allow More Immigration
All of these points have been critiques of the current administration. Some of these might also be critiques of conservative positions generally, but that will depend on to what extent current Republican positions are defined by historical conservative positions or by Donald Trump. This final point may still be the most difficult for conservatives to hear.
As a matter of national security, the U.S. needs more immigrants.
Immigration is an important engine for economic growth, an engine that nationalistic Chinese policies will have a hard time replicating. America is better able to absorb and benefit from immigration than any nation on Earth; it should apply this strength.
The final point relates back to deficits; entitlement spending is projected to continue to grow and consume the federal budget. The ratio of workers to retirees is dropping. Immigration can help change that tide, keeping our working age population growing, when fewer Americans are entering the workforce, often because families are just having fewer children. It won’t be enough, entitlement reform is important as well, but immigration is tool that must be utilized.
Conclusion
I don’t know how much of a danger China really poses to the U.S. Xi Jinping’s recent power grab is a bad omen though, and a large highly nationalistic protectionist country led by a dictator is certainly worth keeping an eye on. But if Sino-American relations get worse in the next decade, U.S. policy is in a poor position to adapt. Trump has claimed to want to confront China, yet his policies are actively harming our national security.
We’re already caught up in how terrible the Trump presidency is, but over the next four years, it will be important to remember just how bad the Obama presidency was. When overcome with frustration at the current administration, I would urge readers to come back to this post and remember that the last president was also quite terrible. In his farewell speech, Obama tried to make the argument for his presidency’s accomplishments, but many of them were simply court cases that were decided while he was president, or decisions that were nice but had little real policy impact.
There have been plenty of reflections on the Obama presidency, but I think a high level overview of everything Obama did would put in perspective just how awful he’s been, especially as we experience the incompetency and horrible policy decisions of the current administration. I’ve done this by letter grades A through F.
The A’s
Iran Nuclear Deal
So…there was only one thing I could give an A to. Even this A is very hesitant. We did give up a lot for this deal–the Iranian government is pretty awful and by unfreezing their assets, they got access to very large amounts of money. However, I don’t think there was much else to do. Unless Republicans actually wanted to declare war on Iran, this seems like the only way to stop them from developing a nuclear weapon. Iran’s nuclear program will be prohibited from refining any uranium for 15 years, and this was accomplished without any military intervention whatsoever. That’s pretty excellent. Moreover, the average citizens of Iran matter as well and it is somewhat unfair to punish them with high inflation and economic hardship because their authoritarian government is irresponsible. Cato expands more here.
The B’s
Trade
One of the most important accomplishments is that Obama’s administration worked to pass several free trade agreements with Korea, Colombia, and Panama. He also tried to complete the Trans-Pacific Partnership and the Transatlantic Free Trade Area, although he could have really pushed harder on these initiatives. Obama didn’t do a great job making the case for free trade and his signature deal was ultimately a failure; honestly, a B is generous here, and is more of a function of the importance of free trade more so than Obama’s actual impact. Also worth noting is that his rhetoric while campaigning was pretty vigorously anti-trade, so he should be commended for changing his mind on this.
Gay Rights
Obama ended Don’t Ask, Don’t Tell, but was still on the record as anti-gay marriage as late as 2012. Sure, public opinion on gay marriage shifted rapidly, but Obama basically waited until it was 50-50 to switch to the right side on this; the Libertarian Party has been on board with gay marriage since the 70s. He should also be applauded for essentially not getting in the way of the court case. I know that’s a low bar, but he could have fought it and tried to keep the DOMA. The other issue is that while this is excellent, the impact of gay marriage legalization is somewhat limited to people who can take advantage of it.
Cuba
The Cuban embargo was imposed over 50 years ago in a bid to quickly end Castro’s dictatorship on the island. It failed. 25 years after the Soviet Union had disintegrated, a president finally spent some political capital to remove an outdated institution. Trade embargoes harm populations, and trade embargoes on a country that has been crushed by horrific socialist economic policies are even more harmful. The president cannot remove the embargo, but everything he can do without Congress, Obama has done on this issue. Trade can bring countries together, and Obama took steps to build those bridges. If he had actually gotten the embargo lifted, this would be an A.
The C’s
Marijuana Legalization
And that’s it for the entirely positive! Marijuana’s big progress had basically nothing to do with Obama, and Obama actually started out fighting it, performing more federal raids on state legal marijuana dispensaries in his first term than Bush. Eventually the administration did make the decision not to continue attempts to enforce marijuana laws with federal police forces. While kind of obvious and not very impressive, this may turn out to be something we remember fondly during the long night of the Jeff Sessions era.
Healthcare
As an incredibly brief overview, the ACA is flawed because it does nothing to address the fundamental problem with the healthcare system: a lack of market forces. The laws of supply and demand create incentives for lower cost and higher quality care. Plastic surgery and lasik are not covered by insurance and thus must compete on price and quality and over time these areas have seen remarkable improvement with prices remaining the same or even dropping.
Our insurance system insulates both consumers and providers of healthcare from the market prices; consumers don’t pay for care, they don’t pay different prices at different places, and they often don’t even buy the insurance that does pay for care. Instead their employers pay for the thing that pays for their healthcare. And sometimes, if you go to a hospital, the insurance doesn’t really pay for care either, it pays the hospital in obfuscated and arcane ways, which in turn provides the doctors and actual equipment needed to provide care. It’s a complete mess.
The ACA did do some nice things like allow people with pre-existing conditions and people who didn’t get their healthcare through their employees and poor people to get health insurance. This is great, and any healthcare reform should strive to do that. However, by not addressing the price issue, they doomed these reforms. Things have sputtered along, but healthcare costs have kept rising, and now insurers are stuck with a disproportionate amount of sick people, needing to raise prices, which only drives away more healthy people. The death spiral was a predictable consequence (and indeed I did predict this in 2010 in a blog attached to my real name and thus will not be linking to here). Obamacare was not a poorly intended bill, but it was an incredible missed opportunity to actually fix the healthcare system. The only reason I didn’t give it a lower grade was because the system was so bad already, it’s hard to argue it was made that much worse.
Global Warming
Obama took steps to reduce climate change. Even if you’re not concerned about the most dire predictions of global warming, that’s probably a net benefit. He also was able to get China to sign onto the Paris Agreement. While not having legal punishments for countries who break their promises, it’s a solid negotiating achievement. However, Obama also implemented, largely by executive order, regulations on coal plants in the US that will have very little impact on carbon emissions. It’s also not at all market oriented, and therefore not particularly economically efficient. Additionally, in his first year in office, Obama had a chance to try and pass a more economically efficient carbon credit trading bill. Assuming climate change is as dire a threat as many say it is (I’m admittedly less worried), it seems to be a poor decision to spend political capital on other bills that did pass, especially something that was as flawed as Obamacare.
The Economy
The employment rate is lower than it has been in a long time, but the problem is this graph. Labor force participation has plummeted from 65% in the depths of the recession to around 62% now. The last time it was this low was before 1980. Since the current labor is around 160 million people, and we are at 62% participation, that means the cohort of the working age population is about 258 million. In 2009, unemployment was around 9%. With a labor force of 155 million people, that’s almost 14 million unemployed. Today with an unemployment rate of 4.7%, that’s only 7.5 million unemployed. However, looking at the people not in the labor force in 2009 there were 83.5 million not working but not unemployed. In 2017, there are 98 million not working but not unemployed. so unemployment dropped by almost 7 million, yet more than twice that many more people were staying out of the labor force entirely. The economy isn’t in free fall, but it’s not knocking it out of the park either, and this is 8 years after the recession. This isn’t entirely Obama’s fault, as the Federal Reserve is much more responsible for economic success overall, but the things Obama did have control over were abject failures: fiscal restraint, entitlement reform, and deregulation.
Immigration
Obama’s legacy on immigration liberalization is mixed. Unfortunately, as this is one of the more important issues in improving the world, a mixed record is disappointing. Obama deported more people than George Bush and he failed to pass any sort of comprehensive reform bill. Obviously, he couldn’t pass bills on everything, but this would have been a pretty important area to do so. Obama did however create an executive order delaying deportations for millions of illegal immigrants. This was a bit odd constitutionally, but with so many illegal immigrants in the United States, it would be impossible to deport them all anyway. Obama’s order simply prioritizes some over others, protecting children and parents of American citizens. This was certainly a good policy, but unfortunately Obama’s legacy in this area should have been so much better.
The D’s
Endless Wars
Obama is the first president to be at war for every day of his presidency. From Iraq to Afghanistan to Libya and Syria, to undeclared wars and bombings in Yemen and Pakistan, we have entered a new era of endless war. Libya is specifically horrifying: Obama chose to involve the American military in Libya unilaterally. He explicitly did not get authorization from Congress, and in fact Congress explicitly voted against a resolution to authorize his military involvement after the fact. That is a terrifying precedent to give Donald Trump.
The only reason this category is not an F is because of Obama’s continued reluctance to expand the US involvement in Syria. Of course, he did this in the worst possible way, by drawing a line in the sand and then backing down from it but it’s undeniable that a larger American role in Syria would have involved the US in one of the largest, bloodiest civil wars of the last decade. Of course, we have not even touched the fact that American troops are in Iraq 14 years after the invasion, and many US contractors remain in Afghanistan 16 years after that invasion. Obama has still institutionalized war in way never before seen.
The F’s
Surveillance
I mean wow. How did we get here? If you want all the citatations, this Mashable article is a good start. The United States government engages in broad sweeps of Americans’ phone records through unconstitutional general warrants issued via a secret court that had no defense team, no oversight, and has only rejected a handful of warrants in its entire history. The NSA also had a program for collecting data on foreigners and Americans from major technology companies, as well as a massive database storing all of that information for later search. Every available method of siphoning data is apparently being used. The NSA also invested heavily in ways to break internet encryption standards. They even paid $10 million to RSA to get them to set their default encryption algorithm to one that was fundamentally broken in one of their products. Most impressively, it turns out that the big phone record collection the NSA was conducting in total secret, that had no oversight and Senators couldn’t even talk about, it’s illegal according to a federal appellate court.
It was such a disaster that Congress eventually tried to pass a reform bill to fix Section 215 of the Patriot Act which is what the courts cited as the justification for these general warrants. Yet in the end, that bill was watered down to the point of uselessness, with Justin Amash, Thomas Massie, and Rand Paul all voting against it due to its lack of real power. In fact, the bill extended the Patriot Act for several years. Obama’s legacy in this area is a total disaster, and he leaves an out of control intelligence agency with no oversight in the hands of a petty authoritarian. The NSA (and all agencies they share information with) knows intimate details about all of our lives, our communication patterns, and our digital existences. As we’ve written before, this is not good.
Transparency
Reason does a good job tearing the Obama administration apart over the “most transparent administration in history” line. Again, this area is such a disaster there are too many things to cover. We can start by discussing how just a month or two prior to the Edward Snowden revealing everything we talked about in the last section, DNI Clapper blatantly lied to a Senate committee about the government’s spying capability. Obama himself has hardly given any interviews to the press. His administration has had more than double the Espionage Act charges against whistleblowers than all previous administrations combined. Which is especially concerning since none of these were acts of espionage! These were legitimate problems that were hidden from view from the public, brought to light by people doing the right thing. But the secrecy was pervasive throughout the administration; regular employees were banned from talking with reporters, a record number of FOIA requests were denied and at least 1 in 3 were denied improperly (which was only ever found out if challenged), and, of course, the government had a secret extrajudicial kill list.
Drone Strikes
Conor Friedersdorf writes that in Obama’s first year in office, his administration conducted over 100 drone strikes…in Pakistan. Quick recap: Congress voted for an Authorization of the Use of Military Force against the perpetrators of the 9/11 Attacks, which allowed the government to invade Afghanistan. Congress also voted to go into Iraq. Pakistan is not one of these countries, yet apparently Obama was carrying out an entire proxy war via drone strikes. In 2010, those strikes only intensified, yet it was worse than that; to cloud the truth, the Obama administration counted all military age males in the vicinity of these strikes as combatants, regardless if they were civilians or not. There were eventually reforms to this process, and the number of civilian casualties per strikes started to go down, but this is but the smallest of victories. In waging these undeclared wars in Yemen, Pakistan, and Somalia, the Obama administration concocted an absurd “legal” process to target specific individuals without a trial, including American citizens. We are talking about a logistically planned and funded protocol for murdering American citizens overseen only by the President. This process eventually ended up killing a civilian by accident, a 16 year old American. This is unjustifiable. No one was ever held accountable for these lawless actions, and the president retains power to murder at will, which he has promptly done, murdering the deceased teenager’s sister this past week. Someone get this guy a Nobel Peace Prize.
Executive Power
This section condenses much of what Gene Healy says in his excellent piece “Goodbye, Obama”. The powers the Obama administration seized and expanded are vast. While initially running against “dumb wars” and unauthorized wars, Obama became the first president to be at war for every day of his presidency. He undertook drone strikes in countries where he had authorization to be in, he even undertook an entire military action in Libya when Congress had expressly voted against supporting it. He continued to use the 2001 AUMF six years after the death of Osama bin Laden and against a group (the Islamic State) that essentially didn’t exist on 9/11. And the Trump administration has continued this justification. His drone strikes have killed hundreds of civilians, and even American citizens. He has created a secret kill list with no oversight from courts or Congress. He has ascended to new heights of secrecy and prosecution of whistleblowers, and he has thwarted attempts at transparency at every turn. Without public knowledge, the ultimate oversight of the democratic process is destroyed as well. And none of this is even touching areas outside national security where Obama also took unilateral presidential orders to new and creative areas. These include instituting new immigration law by executive order when it was bogged down in Congress, creating new overtime labor rules, adding new environmental regulations on power plants, national school curriculum requirements, and even unilaterally amending Obamacare. Healy writes “More than any recent president, Obama has embraced and, to some extent, legitimized the anti-constitutional theory that congressional inaction is a legitimate source of presidential power.”
Obama’s legacy is the Imperial Presidency. Simply by occupying the same office as Obama, Donald Trump inherits vast powers, legislative, military, and judicial. Americans’ private information is available, their lives at risk without the need for due process, the very laws of the country can be changed via the presidential pen. Barack Obama has accomplished much during his presidency, but most of his important projects have ended in utter disaster, and the manner of their attempted accomplishment has greatly imperiled the separation of powers and constitutional restraint. While itg is quite possible, even likely, that the Trump presidency will be worse still, we cannot forget the incredible cost and horrific events of the Obama legacy.
It’s incredible how simple and yet revolutionary the principles are behind effective altruism as well as the ideas behind GiveWell and the Open Philanthropy Project; if you want to help people, don’t just donate to a charity that is looking to cure a rare disease, donate in a way that can do the maximum amount of “good” per dollar. That often means donating to a problem that affects many people, that has known, measurable, positive solutions, and that has lots of room for additional resources to combat the problem. If you don’t know about those organizations, you should definitely check them out.
Of course, there is an obvious elephant in the room when it comes to effective altruism: politics is complex, unscientific, and unpopular. In fact, GiveWell largely sidesteps the political sphere, ignoring a big swath of human activity which has tremendous impacts on society. Of course, they have good reason to do this; it allows them to focus on doing good things without harming anyone’s tribal identities or alienating their donor base. Moreover, it’s hard to get good unbiased data on what political policies would actually provide benefits; if there was, politics wouldn’t be so divisive.
However, I don’t have a donor base, and I have slightly different feelings on which policies would be most effective than the average American or even the average effective altruist. I wanted to see what would happen if we could assume away some of the unknowns about political policy. Let’s assume that the postlibertarian philosophy this blog espouses is correct: markets are pretty good at allocating resources efficiently, government policy can help address some economic areas where markets might not work (inequality, externalities), giving the state power is generally a bad thing and must be justified, and individuals should have robust protections from their government. We aren’t assuming away the current political landscape of the US, we’re just assuming we’re right.
So what would a libertarian trying to maximize efficiency in advocacy do? Do you try and emulate the Koch brothers and create or fund political organizations that change policy outcomes? Do you focus on viable candidates? How much do you accept the political process as given? Do you focus on political reforms (proportional representation), education (IHS, Economics of Library and Liberty), or do you try to work on making your own rules (crypto, seasteading, space exploration)? Let’s leave those hard questions for another time, and focus on perhaps the most mainstream approach to politics: how should you prioritize the importance of various political issues? People usually have specific issues they care about that determine which candidate they’d like to back, and the Open Philanthropy Project even has a U.S. policies page. But which issues are actually the most important? Continue reading Efficient Advocacy
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