Hello and welcome to the Political Party Pooper Playbook.
I didn’t put calls to action at the end; subscribe, comment share. So here’s some buttons.
A note to the listener. I really hate listening to myself on audio. I know everybody says that. But I really do have a voice for newprint. HOWEVER! I discovered in editing my last podcast that my stuff sounds 100% better when played at 1.25 speed. It’s much more engaging. It sounds like Ben Shapiro with an earthier voice. Do with that knowledge as you will.
In last week’s P4B podcast I set up this series and spent a bit of time defining the motivation behind the article America’s Growing Zero Sum Economy. Subtitle: It’s also where you find many of the nation’s ultra-rich.
My first point was a take down of the churlish, class envy subtitle. The previous episode will give you a flavor for the series.
Today, I will dispense with the title itself.
The first and recurring rebuttal to that is this: There is no such thing as a zero-sum economy. This term, much like “trickle down economics”, is a contrivance created by the left. It invents a problem to use as a cudgel with which to attack clear minded, productive, free-market people. That’s where the power of the Left comes from. Emotional outbursts and silly populists notions.
I didn’t use the example of trickle down economics without a reason. I used it as a historical reference to demonstrate how the Left always get economic issues wrong. And I am 100% confident Reich used the term frequently during the Reagan years to try to prevent the 30 years of economic growth we experienced, thanks to the Gipper.
Now, he wasn’t, in his own mind, trying to prevent the expansion. He was just busy being wrong and promoting his Ivory Tower political narrative. That’s what happens when you get into a money gun fight with a broken political knife.
Anyhoo, When Reagan brought Art Laffer and the Laffer Curve into play to support his tax cut proposals, the Left immediately carted out the term “trickle down economics”. As Thomas Sowell pointed out in an article about the subject, NO ONE in the Reagan administration, no one handling the Supply Side argument, said the economy would benefit by money trickling down from rich to poor. And that was never any basis for their efforts.
The Left knew this. But they claimed that the Laffer curve was just that, and Supply Side economics was voodoo economics. What they were intentionally overlooking was Supply Side economics is precisely how an economy works. History proves this. The power and control Lefties see in central planning, which people like Reich espouse, is where economies go to die.
Getting it right
The actual effect of Reagan’s cuts, as with JFK’s and Trump’s cuts is a certain and undeniable ripple effect that happens across the entire economy. The effect mimics perfectly, the ripples in a still pond when you throw a pebble into it. The ripple don’t get to a certain spot and stop. They don’t just stay in the rich side of the pond. They eventually reach the entire pond.
An economy is stones of all sizes being thrown into the pond without let up. What a low tax rate and free market ALWAYS DOES it allow for more people to throw more stones into the pond. And it allows the ripples to reach everywhere in the economy.
I know there will be silly push back on this historical reference. I therefore provide the following:
The Kennedy Tax cuts and resulting expansion and Government revenue: Economic economic growth and increased government revenues.
The Reagan Tax cuts are severely skewed by many as having failed.
I would argue that people like Wessel at the link above, are thinking zero-sum nonsense. Growth throughout the 80’s was nothing short of spectacular. Confidence in the economy was astounding. Everybody was throwing stones in the pond and getting wet.
What went wrong was two-fold. First, after putting a responsible economic plan into effect, Reagan and Congress went on a spending bonanza. And the Gipper started to get cold feet. He signed little increases back into the code instead of letting the inevitable growth occur. And the spending did what all spending does, it created a lag on an otherwise astonishing economic machine. And despite the needless and damaging spending, the US went on a long and successful growth curve.
Left in place revenues to the federal government would have seen steady growth, but the inexcusable spending ruined it. If you expand an economy money does pour into the treasury. But if you outstrip the growth with spending, then yes, revenues as percentage of the GDP will shrink.
And anyone who says the Trump cuts weren’t a “social good” (as we’ll see, this is a Reich tag line) you just aren’t living in reality. His policies put the economy in overdrive - twice. Then Brandon killed it all with his “social good” projects and his massive executive overreach.
The tip-off for me that David Wessel, was thinking in zero-sum terms was his use of the term winners and losers. The whine of central planners.
The “zero-sum” nonsense in Reich’s article and elsewhere in recent history is meant to mean that the economy is a finite thing. If I win, you lose. If congress cuts taxes we get less government revenue. Period. And if I don’t get a personal benefit from a transaction you carried out with someone else, that means what YOU did was a zero-sum transaction.
All of those statements are ONLY true when we are operating in a centrally planned, dystopian economy. None are true in the free market (a slowly dying entity in the US). And Reich repeats the phrase again and again in his piece. And here’s where he tips his central planning hand.
“You might think a rational society would heavily tax zero-sum work while subsidizing work that generate lots of social good.”
Not only is Reich stuck in this historically failed concept, it emerges in almost everything he writes. He and others like him, ten of thousands of them, are teaching this lunacy to our kids. Doubt me not!
Almost all LEGAL financial transactions result in “social good”. They fuel the process by which WE improve OUR lives. The “social good” Reich is clearly espousing in his Substack is the kind of “social good” politicians, the media and ivory tower do-gooders want to saddle us with.
Saddle is the perfect word here. The Left want to use their “social good” as a means of control. It is ultimately demeaning and the more people “benefit” from this kind of “social good” the less likely it is that they will ever be able to go through life without the government on their backs.
This is almost exactly the same kind of “social good” Mexican cartels employ to keep them in business. They make small gestures and give “gifts” to the people in their regions to keep them quiet. The idea is if El Scumo, the narcotics guy, builds a little school in your village or hands out Christmas gifts for your kids, you might develop a bit of amnesia when the federales come sniffing around.
You’re being played for chumps!
Accordingly, the Left (and not a small number of GOP political whores) are enriching themselves at our expense. To continue doing that they are working to control every aspect of our lives (ESG much?) To smooth their way and do more of that, they “give” you things. The more you take, the more they’ll give. Every year they increase the amount of other peoples’ wealth which you can enjoy by keeping them in office. Talk about creating winners and losers!
And as we’ve proven in the endless, phony “war on poverty” we’ve been “fighting” since LBJ, no real good comes from the “social good” people like Reich pontificate about.
We’ve spent multiple trillions, in this “war” on programs that have the veneer of Reich’s “social good”. By gradually debasing respect for value - the value of personal property, the value of civil behavior, the value of respect and accomplishment and keeping one’s word, even the value we hold for our own health - the “war on poverty” has created a society overpopulated with people who have an outsized expectation of free provision. I think the greatest casualty of this debasement is the disrespect for pursuit of real knowledge.
If you don’t see the significance of the last sentence, consider for one second what passes as “science” these days.
At the same time these takers resent the hell out of those who remain at the till, providing the very wealth they exploit. The taking class have become grasping but easily distracted, easily medicated horses the Left rides to stay in power. And the Left knows this.
In a show of pretense that has been churning since FDR, rich elitists have made wild theatrical display of scorn for the making class, calling them greedy and lazy. This is 180 degrees out from reality, like most of what these people dump on the takers. To want without providing is greed. To do little and expect much is laziness.
And I would argue that this very point has been the operating principle behind the “war on poverty”. By making a show of giving “gifts”, the elite cement their power at the expense of their horses in the making class.
And let me caution you here. The line between makers and takers has been blurring for years. More and more people, through frustration or ignorance are becoming the proles. You still work and produce, but you are slowly sinking toward the taking class. You are easily distracted. You don’t look past your desk or front door when thinking of your self -interest. You let entertainment become your knowledge. Sports statistics mean more to you than the health of you 401K.
This class, the proles, wear the same saddles at the takers. And they will be forced to obey along with them. But don’t worry. People like Robert Reich and Klaus Schwab will find flowery phrases to make wearing your saddle seem patriotic, almost pleasant.
I said last week I was working on an idea to dress up our podcast package with music. What you hear now is cute. We now have a little intro and stings and bumps. But it wasn’t the idea I had.
One of my favorite soundtracks is the one from a BBC TV show called Ground Force. It features the Black Dyke Band. Get your mind out the homophobic gutter. It was previously known as the Black Dyke Mill Band. It’s a brass band.
So I got it into my undersized brain cavity that I’d like to feature some really fun or beautiful snippets of the soundtrack here. It would fit the personality of the podcasts, especially future videos we’ll have.
So I emailed the band. On receiving their reply, for one glorious half second I was ready to jump up and cheer. “That sound like a wonderful idea. I know the band would love it.” Good, right? Huh? Then they said that they can’t actually provide the permission because the BBC owns the rights to the music. Wa-wa-wah.
Undetered, I wrote to the BBC and basically begged for the snippets. They told me that they didn’t control permissions, that was contracted to Getty Images. There is no way a retired Gunner’s Mate could have gotten those rights. We’d be talking hundreds of dollars just to start the conversation, and recurring payments!
So I went, tail between my legs, to the place where retired Gunner’s Mates get all their audio snippets. They’re nice. I like them.
But if you want the real high quality brass band stuff you’ll have to make P4B rich. So do subscribe and be ready for when we go to paid. And if you’re really feeling generous, go with the founders option. [insert side eye here]
So much BS to unpack here!
As I move through this intellectual and economic train wreck of an article, the task in breaking it all down into digestible chunks seems endless. Oh, well. That’s why it’s a series, right!
I’ll start today with Reich’s opening statement. I whole-heartedly agree that Trump’s NFT and gold check ideas are a riot. Anyone who purchases one of these are the suckers PT Barnum spoke of. There is an exception with those who are buying them knowing Trump won’t live forever, and when he eats his last Big Mac the price of everything Trump, as with all celebrities, will likely boom. SELL! SELL!
So at least there’s that.
Where RR starts to drift away from reality.
More complex NFT’s and block chain “currency” are slightly different creatures.
NFT has real appeal to the younger tech generation, among whom I and Reich do not number. And it was born as a means of owning works of art that exist only as digits, but are some are arguably quite amazing works. Would Robert argue that art isn’t a social good? Is NFT art to be dismissed because the medium isn’t canvas and oils?
That I nor he would not buy an NFT work says nothing of the actual value of the work. And who are we to criticize the transaction in any meaningful way?
And like all transactions, including buying traditional art, or subscribing the PBS (very popular with rich people), the buyer wants the thing being sold more than the money he has in his hand. Show me a single voluntary transaction that differs from that reality.
Just because someone buys something that doesn’t result in a cut going directly to a third party, does not make the transaction a zero-anything!
Digital currency even has it’s value to the buyer. I see them as being no more than an electronic checking account that is difficult to track. Yes, that is why criminals like them. But we are talking about legal transactions here as Reich was in his piece. And in this realm, the young techies again are the market.
I would never use Bitcoin to make a transaction. But I sure wish I saw the “pet rock” potential in holding some while the market went loony tunes over it. I would have lost not one minute of sleep over the doing of “social good” if I had bought a thousand Bitcoin at a dollar and sold it at the peak last year. And there are two points here.
The first is that people like Reich think it is their duty to extract from me to give to you. In my case all he’d get is debt and truck. But you see my point. The Left feels entitled to tell you what you must do with your wealth. If you don’t share the worldview of say, Robert Reich, you are somehow evil or without merit in their world.
The second point is if I had bought 1000 bitcoin at a dollar and sold it a $62,000 I’d have gotten a whole bunch of social good out of the deal. AND I WOULD STILL NEED TO EAT.
Now, even before Uncle Stinky got his greasy meathooks into my $62M, who can we safely assume would benefit from that money? First, I tell you true, my new accountant and lawyer would. AND THEY EAT TOO!
Then there will be the guy who builds my new house and his crew, and his suppliers and the gas station who fuels his trucks and equipment and the material suppliers and the truckers who move them, and the guys who make the nails, and on and on…
That $62M would send shock waves (the good kind) through my community and state. Every purchase I make will ripple. And yes, I would give money away. American are the most generous people on the planet and I have dozens of things I’d love to fund.
But it’s not all fun and games
But there will be a wet blanket. My county and Virginia and Uncle Stinky would come skulking around for their cut. I won’t begrudge them the productive, efficient things they do with the money. But there is so little of that. And so much of that money would be just handed to people, getting them through until the next check but further debasing their lives in the process. Reich seems to believe that these recipients, across the board are entitled to the money. But we have more than 7 million men of prime working age not participating in the job market. Where does their money come from? And if some are working under the table, you can bet they’d be getting a cut of my Bitcoin sale from Uncle Stinky anyway.
But even THEY have to eat so…ripple,ripple.
You see the point. If I say a thing has no value, that means nothing to the transactors. They will make their exchange and participate in the big pond we call the economy. Even the huge numbers of able bodied, young and middle-age adult welfare sponges serve a purpose in the larger scheme of things. But that lends them no legitimacy.
So at least we have dispensed with the value in Reich’s opinion of other peoples’ buying and selling. That value is zero. But like I said in part one, he sounds good saying it, doesn’t he?
Don’t read too much anger into this series.
I think it’s important to point out that I don’t dislike Robert Reich, the person. If I were at a social gathering and struck up a conversation with the man, I think I’d find him affable and well-mannered - altogether pleasant. I don’t think I’ve ever seen the man shit thunder. Conversely, he might find me a bit loud and flippant (flip? not sure).
The purpose of this series is to debunk the economic and political myths the Ivory Tower, of which he is a charter member, foist on us every single day. And perhaps provide you with some warnings you can provide your kids before the Universities get a hold of them.
..And a warning
In the first few paragraphs, RR mentions FTX. The intrinsic problem with FTX was the fact that is was an elaborate con job. Idiots threw money at this fat slob and since he had money, he had the undivided attention of our political whores in DC. And then they all ended up looking deservedly stupid.
But mark my words, in the very near future, you will be hearing the lecture from Uncle Stinky that BECAUSE of FTX and the fat slob, the ONLY digital currency we should have is the government’s digital currency. This will be, of course, undiluted bullshit. Uncle’s digital money can be manipulated and will be used against you - if you’re not a good prole.
Bad Prole! Bad! No food for you this week!
Thanks for reading The Political Party Pooper Play Book (P4B)! Subscribe for free to receive new posts and support my work.