Fareed Zakaria: The unbearable stench of trump

The unbearable stench of Trump's B.S.

Fareed Zakaria

A few days ago, I was asked on CNN to make sense of one more case in which Donald Trump had said something demonstrably false and then explained it away with a caustic tweet and an indignant interview. I repliedthat there was a pattern here and a term for a person who did this kind of thing: a "bullshit artist." I got cheers and boos for the comment from partisans on both sides, but I was not using that label casually. Trump is many things, some of them dark and dangerous, but at his core, he is a B.S. artist.

Harry Frankfurt, an eminent moral philosopher and former professor at Princeton, wrote a brilliant essay in 1986 called "On Bullshit." (Frankfurt himself wrote about Trump in this vein, as have Jeet Heer and Eldar Sarajlic.) In the essay, Frankfurt distinguishes crucially between lies and B.S.: "Telling a lie is an act with a sharp focus. It is designed to insert a particular falsehood at a specific point. . . . In order to invent a lie at all, [the teller of a lie] must think he knows what is true."

But someone engaging in B.S., Frankfurt says, "is neither on the side of the true nor on the side of the false. His eye is not on the facts at all . . . except insofar as they may be pertinent to his interest in getting away with what he says." Frankfurt writes that the B.S.-er's "focus is panoramic rather than particular" and that he has "more spacious opportunities for improvisation, color, and imaginative play. This is less a matter of craft than of art. Hence the familiar notion of the 'bullshit artist.' "

This has been Trump's mode all his life. He boasts — and boasts and boasts — about his business, his buildings, his books, his wives. Much of it is a concoction of hyperbole and falsehoods. And when he's found out, he's like that guy we have all met at a bar who makes wild claims but when confronted with the truth, quickly responds, "I knew that!"

Take, for instance, the most extraordinary example, his non-relationship with Vladimir Putin. In May 2014, addressing the National Press Club, Trump said, "I was in Russia, I was in Moscow recently and I spoke, indirectly and directly, with President Putin, who could not have been nicer." In November 2015, at a Fox Business debate, he said of Putin, "I got to know him very well because we were both on '60 Minutes.' "

Did Trump really believe that you could say something like that on live TV and no one would check? Did he think that no one would notice that the "60 Minutes" show consisted of two separate prerecorded interviews, with Putin in Moscow and Trump in New York? (By that logic, I have gotten to know Franklin Roosevelt very well because I have run some clips of him on my television show.)

In fact, Trump was bullshitting. He sees himself as important, a global celebrity, the kind of man who should or could have met Putin. Why does it matter that they did not actually meet?

Or look at the issue that fueled his political rise, birtherism. Trump said in 2011 that he had sent investigators to Hawaii and that "they cannot believe what they're finding." For weeks, he continued to imply that there were huge findings to be released. He hinted to George Stephanopoulos, "We're going to see what happens." That was five years ago, in April 2011. Nothing happened.

In fact, it appears highly unlikely that Trump ever sent any investigators to Hawaii. In 2011, Salon asked Trump attorney Michael Cohen for details about the investigators. Cohen said that it was all very secret, naturally. Trump has said the same about his plan to defeat the Islamic State, which he can't reveal. He has boasted that he has a strategy to win solidly Democratic states this fall, but he won't reveal which ones. (Even by Trump's standards, this one is a head-scratcher. Won't we notice when he campaigns in these places? Or will it be so secret that even the voters won't know?) Of course, these are not secret strategies. It's just B.S.

Harry Frankfurt concludes that liars and truth-tellers are both acutely aware of facts and truths. They are just choosing to play on opposite sides of the same game to serve their own ends. The B.S. artist, however, has lost all connection with reality. He pays no attention to the truth. "By virtue of this," Frankfurt writes, "bullshit is a greater enemy of truth than lies are."

We see the consequences. As the crazy talk continues, standard rules of fact, truth and reality have disappeared in this campaign. Donald Trump has piled such vast quantities of his trademark product into the political arena that the stench is now overwhelming and unbearable.

John Case
Harpers Ferry, WV

The Winners and Losers Radio Show

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Stiglitz: Trump and the damage done

Trump and the damage done

Joe Stiglitz

ONE OF Donald Trump's slogans is "Make America Great Again." The irony is that probably never before has a presidential candidate done so much damage — damage that will be hard to repair even if he is not elected.

In a democracy, each elected government has the intrinsic right to change policy; each president has the right to try to persuade Congress to support his priorities. Thus, in a democracy, a "commitment" is always temporary, but the credibility of a country and its government is based on confidence that there will be sufficient continuity among successive governments. Historically, in the United States, foreign policy has been largely bipartisan. At its base, such continuity is based on the premise that there is a broad social consensus. Governments seek to achieve political sustainability of the policies that they enact by working to achieve broad support, often through compromise and cooperation among all elements of society.

Regrettably, the Republican right has sought to polarize the United States. They enacted, sometimes with support of conservative and center-left Democrats, policies that led to the "great divide" between the rich and poor in the United States — to the point where median income, adjusted for inflation, of a full-time male worker is lower than 40 years ago, the hourly wage at the bottom comparable to levels 60 years ago. It is not a surprise that there are many angry people who see the economy not working for them.

Trump has exploited this great divide, announcing a striking change in US policies toward others. Trade agreements will be broken, so too will NATO agreements. Everything is to be renegotiated — even the US debt. Trump, in his own dealings, never seemed to have believed that a man's word was his honor. A contract, a promise to pay, was just the beginning of a negotiation.

Unless Trump is ignominiously defeated, with something like the landslide that defeated Barry Goldwater, the fact that Trump has done as well as he has — that he has received the nomination of one the two major parties, the Grand Old Party — puts all countries on notice: Next time, someone as or more extreme may be elected, someone even less committed (if that is possible) to honor old agreements.

 View Story

If it's liar vs. liar, Trump might win

If the battle for the White House comes down to truthfulness, Trump has a chance. Why give it to him?

Whether Trump likes it or not, the world has become highly interdependent. No country can solve the problems it faces — let alone the problems the world faces — on its own. Whether the United States likes it or not, it will be affected by global warming and climate change; there will be huge economic and social costs associated with weather variability. Terrorism is a global threat. Diseases move across borders, whatever Trump's oratory. The United States is dependent on imports from other countries for many raw materials that do not exist within its borders. The United States requires cooperation with others for the stability of the global financial system and to enforce the global system of intellectual property.

But with such interdependence, there is a need for global cooperation. Such cooperation can't exist if there isn't a basic element of trust and confidence in one another. Trump has issued a strong warning to all other countries: You can't trust me or any agreement I make. And Trump's success — with the support of even seemingly "reasonable" Republicans, like Paul Ryan — has demonstrated that the problem is not just Trump. It is a problem with America. Others are asking, "Can America be trusted? Is its word its honor?" Trump has given a triumphant answer of American exceptionalism. He has said no.

Some might say: Hasn't the United States (like other countries) always acted in its own interests? Isn't Trump simply speaking honestly, something admittedly unusual in the world of global diplomacy?

This misses the critical issue: Yes, countries should act in their own long-term interest, but that requires trust and cooperation among countries. In ordinary business, cheating, lying, breaking one's word, reneging on contracts, defaulting on loans might be good in the short run, but a businessman who engages in such policies will lose the respect of others — at least those who value honesty and trust, who will not want to deal with such a person. So, too, for countries. While the United States has not always been an exemplar of good behavior, never before has anyone in a responsible position suggested that we would renege on our debt. The United States has been a strong supporter of the international rule of law. We may not always fully live up to our agreements, but we typically do. Countries that violate the rule of law face the risk of sanctions. The enforcement of the international rule of law may be imperfect, but it is better than having no rule of law.

We need the cooperation of others. Trump's success has raised the question: Can the United States be trusted in the long run? Trump has already done enormous damage to America's reputation. The only way that the US can ameliorate this damage is for its voters to overwhelmingly repudiate Trumpism.

Joseph E. Stiglitz is a Nobel laureate in economics, university professor at Columbia University, and chief economist of the Roosevelt Institute. He is author of "Rewriting the Rules of the American Economy'' and "The Great Divide."

John Case
Harpers Ferry, WV

The Winners and Losers Radio Show

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On causes of Brexit [feedly]

On causes of Brexit

via Stumbling and Mumbling

http://stumblingandmumbling.typepad.com/stumbling_and_mumbling/2016/08/on-causes-of-brexit.html

There's something about the post-Brexit autopsies that I'm not entirely happy with. It's the failure to distinguish between the margin and the infra-margin.

Take a now-standard narrative – that older, authoritarian, less educated and lower-earningpeople tended to vote Brexit.

As Gary Bennett reminds us, we must avoid a common logical error here. Just because the uneducated disproportionately voted Leave does not mean that Leave voters were mostly uneducated.

Also, as Ben Chu points out, mono-causal explanations raise questions:

If the issue is a post-crash squeeze on incomes, why did young people, who have suffered disproportionately since the 2008 financial crash, apparently vote heavily in favour of continued EU membership while a majority of the over-50s, whose incomes have held up relatively well, vote against?

However, I want to focus on another problem. It's that we knew months ago that older, poorer and less educated people were anti-EU. And yet Brexit came as a surprise – to betting markets, financial markets and not least to David Cameron.

This paradox warns us that whilst the conditions for a big anti-EU vote were in place – we knew for months that some 40% of voters supported Brexit – what remains unexplained is the surprise.

To put this another way, longstanding anti-EU sentiment was infra-marginal. The question is: what happened at the margin to tip the balance in favour of Brexit?  

The answer here, I suspect, lies in the Vote Leave campaign itself. It succeeded in mobilizing latent discontent in a way that neither Labour not UKIP managed in the 2015 general election: only 3.9m voted UKIP but 17.4m voted Leave. It did so in four ways:

 - "Take control" was, as Will Davies says, "a piece of political genius. It worked on every level between the macroeconomic and the psychoanalytic." It spoke to communities which had long left neglected by mainstream politicians.

 - In not providing any sort of precise plan for Brexit, Vote Leave exploited wishful thinking and the tendency of people to take risks when they feel they have lost, by allowing voters to read into Brexit what they wanted: free marketeers saw it as a road to an open economy; Lexiters as a way of snubbing neoliberalism and anti-immigrationists as a way of closing borders. Thus was an incompatible coalition created.

 - It played upon hostility to immigration – a hostility the conditions of which were laid inpart by austerity.

 - It exploited the distrust of experts, and so neutralized economists' warnings that Brexit would make us poorer. It was helped in this regard by inequality. Not only did this create adistance between experts and lay-people, but we also know that inequality causes distrust.

What I'm trying to do here is reconcile two different perspectives. On the one hand, Eric says "culture and personality, not material circumstances, separate Leave and Remain voters. This is not a class conflict so much as a values divide." And Rick says "the left-behind who voted for Brexit last week were left behind a long time ago." These are statements about the infra-margin. But when I say that austerity and inequality – as cleverly exploited by Vote Leave - contributed to the Brexit vote, I'm claiming these things mattered at the margin.

There's something else. Vote Leave was surely one of the most successful political campaigns in history. It was also dishonest and anti-intellectual. That both these claims are true is one of the most troubling features of modern politics.

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Ain't Kitten

   "I Ain't Kitten, either"  

John Case
Harpers Ferry, WV

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MiB: Danny Kahneman [feedly]

MiB: Danny Kahneman
http://ritholtz.com/2016/08/mib-danny-kahneman/

In this week's "Masters in Business" podcast, we chat with Danny Kahneman, professor of behavioral & cognitive psychology, and winner of the 2002 Nobel Price for economics. He is also the author of the highly regarded Thinking Fast & Slow.

In a wide-ranging discussion, Kahneman discusses how he met Amos Tversky, who became his his long time research partner. He describes how "we" won the Nobel Prize, referring to his sharing of the prize with Tversky, who died prior to the Nobel Prize win.

Kahneman discusses the process of how they discovered the first three heuristics of Representativeness, Availability, and Anchoring. He tells why going first in a negotiation is, contrary to common opinion, an advantage, as the human brain tries to make sense of the number it receives, regardless of how ridiculous it may actually be.

For example, the Availability heuristic – "WYSIATI" aka What you see is all there is – reveals how people are unaware of what they do not know, and people use available info to create a narrative. Hence,

"Availability bias" allows people to use what looks to be salient info to fabricate narratives that seem to make sense.

You can hear the full interview, including the podcast extras, by downloading the podcast at iTunes, SoundCloud or Bloomberg. All of our earlier podcasts are atiTunes, Soundcloud and Bloomberg. (The show broadcasts all weekend on Bloomberg radio and SiriuxXM, at Friday at 9pm, Saturdays at 10am, 6pm, and 11pm, and Sundays at 3am).

Next week, we sit down with Michael Mauboussin, head of Global Financial Strategies at Credit Suisse, adjunct professor at Columbia University's school of business, and author ofUntangling Luck and Skill in Sports, Business and Investing.

 

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Globalization and its New Discontents [feedly]

Globalization and its New Discontents
https://www.project-syndicate.org/commentary/globalization-new-discontents-by-joseph-e--stiglitz-2016-08

NEW YORK – Fifteen years ago, I wrote a little book, entitled Globalization and its Discontents,describing growing opposition in the developing world to globalizing reforms. It seemed a mystery: people in developing countries had been told that globalization would increase overall wellbeing. So why had so many people become so hostile to it?

Now, globalization's opponents in the emerging markets and developing countries have been joined by tens of millions in the advanced countries. Opinion polls, including a careful study by Stanley Greenberg and his associates for the Roosevelt Institute, show that trade is among the major sources of discontent for a large share of Americans. Similar views are apparent in Europe.

Overcoming the Poisonous Politics of Protectionism

Simon Tilford examines how Barry Eichengreen, Joseph Stiglitz, Laura Tyson, and other Project Syndicate contributors address the anti-trade sentiment roiling advanced economies.

How can something that our political leaders – and many an economist – said would make everyone better off be so reviled?

One answer occasionally heard from the neoliberal economists who advocated for these policies is that people are better off. They just don't know it. Their discontent is a matter for psychiatrists, not economists.

But income data suggest that it is the neoliberals who may benefit from therapy. Large segments of the population in advanced countries have not been doing well: in the US, the bottom 90% has endured income stagnation for a third of a century. Median income for full-time male workers is actually lower in real (inflation-adjusted) terms than it was 42 years ago. At the bottom, real wages are comparable to their level 60 years ago.

The effects of the economic pain and dislocation that many Americans are experiencing are even showing up in health statistics. For example, the economists Anne Case and Angus Deaton, this year's Nobel laureate, have shown that life expectancy among segments of white Americans is declining.

Things are a little better in Europe – but only a little better.

Branko Milanovic's new book Global Inequality: A New Approach for the Age of Globalization provides some vital insights, looking at the big winners and losers in terms of income over the two decades from 1988 to 2008. Among the big winners were the global 1%, the world's plutocrats, but also the middle class in newly emerging economies. Among the big losers – those who gained little or nothing – were those at the bottom and the middle and working classes in the advanced countries. Globalization is not the only reason, but it is one of the reasons.

Under the assumption of perfect markets (which underlies most neoliberal economic analyses) free trade equalizes the wages of unskilled workers around the world. Trade in goods is a substitute for the movement of people. Importing goods from China – goods that require a lot of unskilled workers to produce – reduces the demand for unskilled workers in Europe and the US.

This force is so strong that if there were no transportation costs, and if the US and Europe had no other source of competitive advantage, such as in technology, eventually it would be as if Chinese workers continued to migrate to the US and Europe until wage differences had been eliminated entirely. Not surprisingly, the neoliberals never advertised this consequence of trade liberalization, as they claimed – one could say lied – that all would benefit.

The failure of globalization to deliver on the promises of mainstream politicians has surely undermined trust and confidence in the "establishment." And governments' offers of generous bailouts for the banks that had brought on the 2008 financial crisis, while leaving ordinary citizens largely to fend for themselves, reinforced the view that this failure was not merely a matter of economic misjudgments.

In the US, Congressional Republicans even opposed assistance to those who were directly hurt by globalization. More generally, neoliberals, apparently worried about adverse incentive effects, have opposed welfare measures that would have protected the losers.

But they can't have it both ways: if globalization is to benefit most members of society, strong social-protection measures must be in place. The Scandinavians figured this out long ago; it was part of the social contract that maintained an open society – open to globalization and changes in technology. Neoliberals elsewhere have not – and now, in elections in the US and Europe, they are having their comeuppance.

Globalization is, of course, only one part of what is going on; technological innovation is another part. But all of this openness and disruption were supposed to make us richer, and the advanced countries could have introduced policies to ensure that the gains were widely shared.

Instead, they pushed for policies that restructured markets in ways that increased inequality and undermined overall economic performance; growth actually slowed as the rules of the game were rewritten to advance the interests of banks and corporations – the rich and powerful – at the expense of everyone else. Workers' bargaining power was weakened; in the US, at least, competition laws didn't keep up with the times; and existing laws were inadequately enforced. Financialization continued apace and corporate governance worsened.

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Now, as I point out in my recent book Rewriting the Rules of the American Economy, the rules of the game need to be changed again – and this must include measures to tame globalization. The two new large agreements that President Barack Obama has been pushing – the Trans-Pacific Partnership between the US and 11 Pacific Rim countries, and the Transatlantic Trade and Investment Partnership between the EU and the US – are moves in the wrong direction.

The main message of Globalization and its Discontents was that the problem was not globalization, but how the process was being managed. Unfortunately, the management didn't change. Fifteen years later, the new discontents have brought that message home to the advanced economies.

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