Election Results and Presidential Transitions

President Trump needs to cooperate with Mr. Biden’s transition team. Full stop.

President Trump does not need to show grace, although he should. He does not need to drop his legal challenges to election administration in selected states, although he should. He does not need to officially concede, although he should. But he does need to direct his presidential staff and agency principals to provide briefing materials, office space, and other assistance to Mr. Biden’s transition team. In kind, the media needs to accurately report administration transition preparations, not Trump tweets.

There is a difference between laws and norms. Both are important. Candidates conceding elections, showing grace, dropping challenges, and calling for unity are good norms that help make our republic more resilient. But none of those practices are law. Laws such as The Presidential Transition Act (PTA) provide a legal framework for continuity of operations. https://www.govinfo.gov/content/pkg/PLAW-114publ136/pdf/PLAW-114publ136.pdf

What is the current status of transition preparations? Back in April 2020, the Whitehouse directed agency personnel to prepare for an orderly transition. See Executive Order M-20-24. https://www.whitehouse.gov/wp-content/uploads/2020/04/M-20-24.pdf The executive order required compliance with the PTA with a deadline.

“Not later than September 15, 2020, and in accordance with subchapter III of chapter 33 of
title 5, United States Code, the head of each agency’ shall ensure that a succession plan
is in place for each senior non-career position in the agency.”

As a norm, the president should not challenge whether or not Mr. Biden is “an eligible candidate or president elect” within the meaning of the PTA. “(c)The terms ‘President-elect’ and ‘Vice-President-elect’ as used in this Act shall mean such persons as are the apparent successful candidates for the office of President and Vice President, respectively, as ascertained by the Administrator following the general elections held to determine the electors of President and Vice President in accordance with title 3, United States Code, sections 1 and 2.” https://www.law.cornell.edu/uscode/text/3/102

Readers interested in more detail are referred to CRS Report RL34722, coordinated by L. Elaine Halchin. https://fas.org/sgp/crs/misc/RL34722.pdf

Disastrous Transition – Hoover and FDR

Incumbent Herbert Hoover lost to Franklin Delano Roosevelt (FDR) in November 1932. Inauguration at that time was not until March 1933. FDR is generally given credit for gathering a range of experts in Warm Springs, Georgia to hit the ground running in March, such as this article in the Atlantic. https://www.theatlantic.com/magazine/archive/2019/03/fdr-herbert-hoover-big-government/580456/ What such articles often omit is that rumors of FDR’s intended policies roiled financial markets between November and March. Internationally, there was a run on the dollar because it was rumored that FDR would depreciate the value of the dollar. https://www.federalreservehistory.org/essays/banking_panics_1931_33 Domestic banks suffered a similar run both as domestic default rates soared and as their gold reserves were drained by worried counterparties. Upon taking office, FDR is credited with halting the crisis by declaring a bank holiday on March 6th.

But is it OK to ask if the panic subsided after March 6th because the system had already collapsed during the prior week? This is how the Federal Reserve characterizes the week prior to FDR’s inauguration.

“The Fed again raised discount rates and acceptance buying rates in February 1933, as it had during the fall of 1931, to help slow the drain on gold reserves. Interest rates rose across the board. But once again, the Fed did not increase its open market purchases significantly (Friedman and Schwartz 1963). In response to the large gold losses in New York, the Chicago Fed provided loans to the New York Fed on March 1 and 2, but refused the New York Fed’s request for another loan on March 3 out of concern for its own reserve ratio. The Federal Reserve Board then suspended the gold reserve requirement on March 3 (Wicker 1996). Rather than containing the panic, “The System itself shared in the panic that prevailed in New York” (Friedman and Schwartz 1963, 327), and even the Federal Reserve Banks were closed on March 4.”

Hoover and FDR did not cooperate between November and March while the financial system collapsed for the third time in four years. Accounts like those in the Atlantic believe Hoover intentionally undermined FDR in order to prepare for the 1936 election. What is absent from such reports is that FDR refused to cooperate with Hoover. FDR wanted Hoover to shorten the transition time by appointing FDR Secretary of State and resigning. https://www.newsweek.com/alter-what-obama-can-learn-fdrs-dodge-84987 Hoover criticized FDR’s rumored plans and wanted FDR to comment publicly because in Hoover’s view the run on the dollar and the bank runs resulted from lack faith in FDR’s commitment to the gold standard. Rather than take Hoover’s calls or make a public announcement, FDR responded that he believed that people were withdrawing from banks because they lacked faith in banks.

The Great Depression was already a disaster prior to the 1932 election. However, the presidential transition period saw the worst of the state bank failures and the international run on the dollar. One has to wonder if the transition off the gold standard could have been done with less financial collapse if Hoover and FDR had cooperated.

Lessons for Trump and Biden

Joe Biden has already signaled his willingness to cooperate. Donald Trump needs to cooperate with the Democratic transition team even if he defies other norms for concession, grace, and calls for unity. Presumably, the agencies began their preparations in April and executed the requirements of the PTA by September 15, 2020 pursuant to the Whitehouse’s executive order. President Trump can pursue his legal challenges (which I believe are doomed to fail) while preparing the new administration if (when) the challenges lose. Combative presidential transitions can make a bad situation worse. Year 2020 has been bad enough.

Modern Monetary Theory, Part 2: Colonial Dependents, Sovereign Money?

This is the second post in my mini-series on “soft money” Modern Monetary Theory (MMT) to the left, “hard money” Goldbugs to the right, and mainstream economists between. Mainstream economists worry that soft money economists lead their countries on the path to hyperinflation and sovereign bond default. MMT scholars argue that many of the examples used by mainstream economists are inapplicable because the governments cited were not sovereign money issuers. This post explores what MMT scholars mean by sovereign money – with a fun detour to the supposedly sovereign money of colonial subjects.

The MMT concept of sovereign money can be quite subtle. Today, we will see how some MMT scholars argue that British North American colonies in the 18th century were sovereign money issuers despite British mercantilism and colonial lack of what most people would consider sovereignty. Yet, those same states are no longer sovereign money issuers despite achieving independence and amending the new Constitution with the 11th amendment’s guarantee of state sovereign immunity against its creditors. Sorting it out will require revisiting an old debate in economic history, was there a money shortage in the English North American colonies?

Under English Mercantilism, the colonies had to return English coins to the mother country (England). As a result, other forms of payment circulated as the medium of exchange in colonial North America, including the Spanish dollar. Graphic 1 shows some North American money used during the colonial era. The colonies experimented with a number of paper alternatives. Many of these items were not designated money through a legal tender law compelling private sellers to accept them as payment; rather, they often circulated organically like the giant stones of Yap. (I apologize for the blurriness of the attached pic of colonial money from the Museum of American History.)

Reminder – The first post in this series used the giant stone money of the island of Yap to illustrate the standard “greater fool” theory of the origins of commodity money. The stone rai used on Yap demonstrated how an evolved commodity money can rely on a ledger to track money balances, not the commodity itself, even if the commodity sinks to the bottom of the ocean. Mutual ascent of the value of ledger balances replaces any intrinsic value of the commodity, if it ever had any. A working financial system can evolve money without real backing, but that doesn’t mean it did.

Randall Wray and other MMT scholars reject the commodity money framework as historical fact and as a framework to evaluate public policy. They believe that government power to spend and compel tax payments for redemption is the true origin of money. People willingly accept a government spending receipt as a medium of exchange because somebody will have to pay taxes, not just because it has been designated legal tender. Importantly, while MMT scholars say government spending receipts are money, they distinguish fully “sovereign money” from other government issued money. Therefore, some MMT scholarship is an objective assessment of the options available to a government that issues “sovereign money,” and the consequences of those options. Other MMT scholarship is a normative case for adopting the institutions of “sovereign money.” So, what do MMT scholars mean by “sovereign money” and what are some examples?

Sovereign Money Institutional Requirements

  • Government chooses the money of account in which money balances are denominated
  • Government imposes tax obligations denominated in its chosen money of account
  • Government issues currency denominated in its chosen money of account
  • Government accepts the currency it issues to satisfy its tax obligations.
  • Government obligations against itself (bonds) are denominated and payable in its currency.
  • The rate of exchange between this government’s sovereign money and other government’s sovereign money is allowed to float.

Some examples may help. The United States government is a sovereign money issuer. It chooses the accounting for money (the US dollar), imposes taxes in US dollars, issues currency denominated in US dollars, issues bonds denominated in US dollars, US taxes and US bonds are payable in US dollars, and the rate of exchange between US dollars and other currencies is allowed to float. The US government also has the power to determine the interest rate on its dollar denominated obligations.

The state of Illinois is not a sovereign money issuer. Illinois does not control the issuance or accounting standard for the currency used to satisfy its tax obligations or to redeem its bonds. The rate of value between an “Illinois dollar” does not float against the value of a “Nebraska dollar.” The state of Illinois cannot determine the interest rate on Illinois-dollar denominated assets.

Greece is not a sovereign money issuer. Greece is part of the European Union and relies on the EU currency, the Euro. Greece is more sovereign than Illinois in many ways, but Greece does not determine the value of the Euro just as Illinois does not determine the value of the US Dollar. Greece does not control the issuance of Euros. Greece’s bonds and tax obligations are denominated in Euros, not a currency it controls. Whatever its sovereignty in other dimensions, Greece is not a sovereign money issuer in an MMT perspective.

The case of Denmark is more nuanced. Denmark is part of the EU, but issues its own currency, the Danish Krone (DKK). At first blush, Denmark appears to be a sovereign currency issuer. It controls the accounting for DKK, issues currency and bonds denominated in DKK, and payment of DKK satisfies tax obligations and bond redemption. In theory, Denmark could regulate the interest rate of its obligation or let its currency float against other sovereign currencies. However, Denmark typically pegs the value of the DKK to the Euro rather then let its exchange rate float. Proposals for the EU to issue bonds always require addressing the rate at which Denmark and other EU members who do not use the Euro will be required to contribute to common bond obligations. Commitments by Denmark to maintain its peg to the Euro or to contribute to common bonds at a fixed conversion rate are not the hallmarks of a sovereign currency issuer.

Caution – it is a mistake to conclude that the general hierarchical relationship determines sovereign money from the MMT perspective. The United States participates in many multinational organizations, some of which it has ceded full or partial sovereignty over narrow policy areas. A treaty binding US acceptance of a UN or WTO decisions does not negate the US status as a sovereign money issuer unless it affects the six criteria listed above.

MMT scholars argue that many mainstream economic policy concepts do not apply to governments which issue sovereign money. First, acceptance for tax payment, not declaration of legal tender for private debts, creates money status. Private markets willingly accept the sovereign money because they can rely on someone having to pay tax obligations to accept them in return. Taxpayers create demand for money that satisfies the tax payments even for exchanges between two non-taxpayers for the same logic as the “greater fool” theory of commodity money. Issuers of sovereign money always have the ability to redeem and retire their bonds because the bonds are denominated in their own sovereign currency. Should government obligations be transferred to foreign hands, the floating exchange rate ensures the ability to redeem any amount of obligations.

Sovereign Money Consequences in MMT View

  • Sovereign Money Issuing (SMI) Government cannot run out of money
  • SMI Government interest rate policy, not bond markets, determines the terms of government finance
  • SMI Government does not face a budget constraint as conventionally defined
  • SMI Government can always ensure employment of its entire population
  • SMI Inflation is caused by demand for real resources, not the supply of money

Some critics of MMT issue dire warnings of financial collapse. Critics accuse the MMT scholars of believing that governments should (a) spend without limit, (b) act as if deficits don’t matter, and (c) operate government with unconstrained budgets. Critics argue pursuing the above three policies, which critics believe would require central banks to print money, would lead to hyper-inflation.

But MMT scholars deny the advocate for profligate spending. MMT scholars accuse the critics of conflating positive theoretical assessment with normative advocacy. For example, MMT scholars believe that mainstream scholars overemphasize a link between money creation and inflation. MMT is not unusual in believing that increased government spending during a period of high unemployment or otherwise slack economy does not necessarily cause inflation. More controversially, the MMT scholars deny that central banks need be the primary tool of money creation – remember that to an MMT scholar the receipts of government spending can circulate as money until they are redeemed as taxes.

Something about MMT seems wrong to people familiar with history. There seem to be too many examples of monetary basket cases and budget constrained countries to believe governments can’t run out of money – whether winners or losers in war, whether a developed economy or part of the developing world, whether in the modern era or long past history. Both victorious post-revolution America and defeated post WWI Germany experienced hyper-inflations. From Argentina to Zimbabwe, a variety of countries struggle with exchange rate collapse, inflations, and sovereign bond defaults.

MMT scholars are not blind to these historical events. In each case, MMT scholars attempt to identify an institutional feature that they say disqualifies the example as a sovereign money issuer, or find a catastrophic event in the real economy that they hold responsible for the government’s financial straits. Some MMT scholars may even suggest that developing nations are not yet ready for, or have not yet achieved, the ability to be a stable sovereign money issuer. This leads to the question of whether there are foundational conditions necessary for sovereign money.

It is easy to be misled into thinking that some level of economic development is the pre-requisite for issuing sovereign money. This is not the case. A sovereign money issuer need not have a powerful military, or issue the internationally recognized reserve currency, or closely regulate its banking system, or act as the central hub of a trade network. In fact, the government need not be the only monetary authority. Advocacy for issuing a parallel currency is not an uncommon application of MMT. Randall Wray believes that the American colonies illustrate the possibilities of a parallel currency and sovereign money even in the context of a dependent colony.

Monetary Experiments in the American Colonies, 1607-1787

Randall Wray relies on the work of economic historian Farley Grubb to describe the colonial monetary regime. https://www.nber.org/people/farley_grubb?page=1&perPage=50 Grubb’s work casts doubt on a relationship between money printing and inflation.

The quantity theory of money is applied to the paper money regimes of seven of the nine British North American colonies south of New England. Individual colonies, and regional groupings of contiguous colonies treated as one monetary unit, are tested. Little to no statistical relationship, and little to no magnitude of influence, between the quantities of paper money in circulation and prices are found. The failure of the quantity theory of money to explain the value and performance of colonial paper money is a general and widespread result, and not an isolated and anomalous phenomenon. https://www.nber.org/papers/w22192

Wray interprets Grubb’s work on colonial American monetary institutions as an illustration of MMT principles. The general policy of the British mercantilist policy in the colonial period was to accumulate currency in the mother country. Pursuant to that policy, British metal coinage was shipped back to England. When British interests favored colonial assistance against rival powers, the colonies were permitted to issue paper bills of credit to pay soldiers and acquire supplies. Colonies issuing and redeeming their own bills of credit became common, with outstanding paper bills forming part of the circulating money supply. An example from the 1690 Prince William’s War was printed with the following.

“This indented Bill of Five Shillings due from the Massachusetts Colony to the Possessor
shall be in value equal to money and shall be accordingly accepted by the Treasurer and
Receiver Subordinates to him in all Public payments and for any stock at any time in the
Treasury – New England, February the third, 1690. By order of the General Court.” file:///C:/Users/Owner/Downloads/historyo.pdf

Wray argues that colonial paper satisfies sovereign money. A Virginia Bill or North Carolina Bill was spent in units of Virginia or North Carolina pounds, and satisfied a corresponding tax obligation. Colonies could not rely on their bank regulatory authority to create money because of British review by the Board of Trade. Instead, the fact that a colony accepted its own bills for tax obligations encouraged circulation. The value of colonial bills floated against each other and circulated simultaneously.

MMT scholars place importance on the fact that these circulating bills of credit were government spending prior to being money or taxes. It was not unusual for these bills of credit to be destroyed upon redemption by the colonial government. In the MMT view, the colonial spending created money during the period of circulation. Redemption of the bills through taxation was effectively an inflation fighting move in their view. In colonial America, MMT scholars do not see the primacy of a commodity money magnified by banking balances.

Implications and Further Questions

The MMT scholars have invited us to revisit the origin, history, and nature of money. The seemingly obscure example of colonial North America has many implications for modern governments. For example, to what extent could countries in the Eurozone avoid a future crisis similar to Greece by allowing modern equivalents of circulating bills of credit? On the other hand, to what extent were colonial bills of credit effective because of an implicit relationship to the British crown, if any?

A system of multiple sovereign moneys creates exchange rate risk for international traders, financiers, and travelers. Even if MMT’s controversial theories of taxation, money, and inflation are true, would multiplication of currencies be stable in an increasingly globalized world? Consider the following quote from 1741 colonial America. ““There certainly can’t be a greater Grievance to a Traveller, from one Colony to another, than the different values their Paper Money bears.” An English visitor, circa 1742 (Kimber, 1998, p. 52). https://eh.net/encyclopedia/money-in-the-american-colonies/

These first two posts have been focused on convincing readers that Modern Monetary Theory’s conception of money is different from mainstream economists in a fundamental way. Unlike mainstream economists, MMT scholars do not start with commodity-based payment system and then build a money multiplier through the banking system. MMT scholars start with the receipts of government spending, redeemed through taxes, as the foundation for the payment system. Using the mainstream framework to evaluate the policy suggestions of MMT scholars assumes the MMT scholars are wrong from the beginning. In order to assess MMT, it is better to approach their theories about government spending, taxes, and payment systems with the same critical mind of any other theory. Future posts will discuss how an MMT approach to macroeconomic policies would differ from current approaches and discuss legal obstacles and options to implementing MMT.

Modern Monetary Theory, Part 1: Stone Money

This is the first post in a planned series on Money, Banking, and Macroeconomics.  Woohoo!  Recently, mainstream economists opposed the nomination of Judy Shelton, a “hard currency” economist, to the Federal Reserve Board.  On the other hand, mainstream economists also oppose the growing influence of “soft currency” economists such as Stephanie Kelton who is a Modern Monetary Theory (MMT) advocate.  MMT is popular among Democratic Socialists like Bernie Sanders and AOC. Yes, I chose Judy Shelton and Stephanie Kelton as the opposing representative economists because it would be confusing.  The study of Money, Banking, and Macroeconomics is confusing, so it seemed fitting. 

In small chunks, this series will provide my initial assessment of (MMT).  What is money? At a minimum, money is the means of payment, also known as the medium of exchange. Money may also serve other purposes such as a store of value and standard of account. What better way to explore debates on hard currency and soft currency than an exhibit of stone money?

Stone Age Currency: Sophisticated Money

The Smithsonian Museum of Natural History exhibits a giant stone circle from Yap, an island in the Pacific.  The stone, called a rai, is taller than I am and is much too heavy and unwieldy for a person to carry around.  (See picture). Can not imagine putting one on a raft or in a canoe and shipping it among Pacific islands.  Yet, people across the Pacific used these giant stones as a medium of exchange.  Exhibiters say that a rai would be used for the transfer of ownership of land and certain other transactions and ceremonies, and a parallel medium was used for other transactions.  Although the rai system may seem primitive, it is actually quite sophisticated with many lessons for monetary economics.

Lesson 1: Greater Fools – Almost any token can serve as a medium of exchange for as long as sellers believe they can unload the token on someone else.  A seller need not have a use for the medium as long as there is a greater fool willing to accept it for desirable.  Characteristics often cited for a commodity evolving naturally to this function include something that is easily divisible, durable, easily transportable, and difficult to counterfeit.  What!  A giant stone rai does not seem to fit the bill, at least at first blush.

Lesson 2: Only Need a Ledger – Do we really need to carry around a rai?  Or silver shavings?  Or wampum shells?  Or metal badges stamped to assure their weight (coins)?  Badges?  We don’t need no stinking badges!  We only need a ledger.  Someone needs to keep track of who owns how much of the medium of exchange.  Maybe write it down in a ledger, or keep track with colored beads in pottery representing each person (I made up the beads/pottery example).  The point is, transporting a rai is unimportant if someone just keeps track of transfers of ownership.  If you think about it, your bank account is just a line in a giant ledger.  The use of “Dollar” coins dropped out of use for many transactions with the rise of checks, long before the rise of debit cards.

Apocryphal Story: That Guy – An economic historian of money tells a rai story in Money Mischief.  In general, the giant stones were not physically transported; islanders just kept track of who owned them.  But every society has “that guy.”  Someone insisted that a buyer ship him his stone.  A storm came and sunk the that particular rai to the bottom of the ocean. Since everyone agreed on the transaction, and on the existence of the stone, the “ledger’ was adjusted just as if the rai had been transported.  Even if this story is fanciful, its lesson is real.  Once there is a ledger, there need not be any actual commodity medium of exchange.

MMT Proposition 1: Tax obligations create a medium of exchange –  Some MMT economists such as L. Randall Wray object to the ‘greater fool’ story of the evolution of commodity money.  He believes money evolved from tax obligations.  An authority that has the power to compel tax payment necessarily has the power to create money.  Some people will have to pay the taxes; therefore, even people who don’t have to pay the taxes can count on someone who does have to pay the taxes being willing to accept the announced token as a medium of exchange.  Among the evidence, Wray and others point to archaeological and historical evidence linking tax obligations and the development of writing systems. 

MMT Proposition 2: Government IOUs are Necessarily Redeemable – Wray and others assert that if there is an authority with unlimited ability to compel tax payments then government cannot go bankrupt.  If government accepts its own IOUs in payment for taxes, then any apparent surplus in IOUs can be redeemed.  A corollary of this view is that government causes inflation through its demand for real resources – displacing non-governmental uses – not by printing too much money.  Excess money can be soaked up through higher taxes.

Question: Was a Giant Stone the Chicken or Egg?  Wray emphasizes the history, law, and accounting of money.  He emphasizes the assertion that government spending precedes money, with the obligations themselves serving as the credible medium of exchange.  Which came first, the spending or the money?  If economist Wray is correct, then the giant stone rai in the South Pacific were government spending prior to money.  But does it really matter? The seas are 150 feet higher than when humans built monumental structures like Gobekli Tepe in modern Turkey. Would a finding by underwater archaeologists that showed commodity money preceded taxes negate MMT’s insights, or the reverse confirm them?

Complications – MMT scholars do add more sophistication to this overly simplistic story.  What if there are multiple tax authorities over the same people?  What if people in one taxable location want to exchange with people in a separate taxable location (exchange rates)?  What if there are Constitutional restrictions on the ability to tax?  What if the tax authority cannot set the rate at which obligations can be redeemed?    

Preview: Sovereign Money – My next ‘soft currency’ post will be on MMT conception of what they call sovereign money, and what they say is not.

Correction – The Turkish archaeological site originally referred to Catalhoyuk, which dates back to 7k BCE. It has been corrected to read Gobekli Tepe, which dates back to 10k-8k BCE. Point remains the same.

My Vote for President

I voted for Joe Biden. I just posted “8 Ways to Oppose Fascism.” In it, I describe the three-way 20th Century contest between Liberalism, Communism, and Fascism. In my opinion, every American president of both parties after World War II through President Obama accepted the broad Liberal consensus. That consensus held that governments rule with the consent of the governed. Governments have a duty to protect individual rights, including property rights, and administer justice on an individual basis. Individuals have maximum freedom to direct their own lives as long as it does not harm others, and as long as it is consistent with extending the same rights to others. I believe growing forces in both parties reject that consensus. Unless there is a revival, I believe Joe Biden will be the last president of the bi-partisan 20th Century consensus.

First, the easy part. I am for open immigration. I am for amending the Constitution to permit Congress to regulate the production, distribution, sale, ownership, and usage of firearms. I am for a woman’s right to choose to abort her child in consultation with her own medical professionals. I am for multilateralism in our military and defense relationships. I am for multilateralism in managing the rules for currencies (international finance). I am for multilateralism for managing the rules for exchanging goods and services (international trade). I am for using government as a convenient method of funding charitable safety insurance programs for health, old age pensions, and catastrophe. I am for using government as a convenient method to fund charitable baselines for food, water, electricity, education, housing, and education. However, for the role of government, I recognize that developed countries have experiments with a wide variety of methods of funding and delivering these services. Farmers do not need to be public employees to make sure that people don’t starve. For all these reasons, I support Joe Biden.

There are, and always have been, elements in both major parties that align with my views. Similarly, there have always been elements of both major parties that don’t align with my views. Therefore, I have swung between the parties. I do not consider myself a moderate, or somehow more objective than other people. I just vote for people who seem to match my views on major issues.

However, just as Communism imploded in 1989, I can see 20th Century Liberal Capitalism beginning to implode. The Liberal wing of both parties is in decline. Government relying on consent of the governed? Behavioral scientists challenge the meaningfulness of consent and focus on cognitive biases. Public decisions as the result of participatory legislatures? There is growing pressure to cede political evaluation of policy options to the technical advisers charged with evaluating the consequences of those options. Freedom of the press? There is growing pressure to regulate the flow of information, especially information with political import. Rights of individual defendants? There is growing pressure to subjugate presumption of innocence and due process not to rights of the alleged victim, but to the alleged harm experienced by observers affected by a similar crime. The ideal of justice as blind and focused on the actions only of the accused individual? The move is toward the exact opposite.

But most dangerously, in my opinion, is the success of illiberal activists. It is often intentional propaganda and obfuscation. The definitions of terms are changed after the fact to smear public figures. Just like the Committee of Public Safety at the height of the reign of terror, being labeled a moderate is to be accused of a thought crime. Rather than engage in substantive debate, the young are being trained to de-platform those they disagree with. Trivial activities from long lost decades are dug up to degrade ‘the enemy’ and drive them from the public square.

There is no safe harbor. To be inclusive is to culturally appropriate and be oppressive. To be neutral is to default to the dominant and be oppressive. To be silent is to be complicit with evil.

Basic functions like police are being undermined. Despite polling among African-Americans favoring more police resources to reduce response times in African-American neighborhoods considered underserved, activists demand defunding the police. Despite minority mayors raising police funding pursuant to recommendations of the 2015 blue ribbon panel formed by a minority Attorney General serving a minority President, people who try to discuss defunding police rather than repeat the slogan (not even in opposition yet) are branded oppressors or sell-outs.

Of course, none of this is the first or the worst in American history. It does not need to be either first or worst to be bad. And I am humble enough to consider that my values could be wrong, maybe all this is good. But large or small, good or bad, the rise of illiberalism among the young is unmistakable.

The Progressive wing of the Democratic Party is anything but. Among a growing number, justice is defined in terms of the group, not in terms of the individual. Due process and equality before the law for political opponents are labeled microaggressions. Attempts to strip the law of references to race are actually redefined as racism. Joe Biden may be the last post WWII consensus president nominated by either party.

8 Ways to Oppose Fascism

Although I have already voted, tomorrow’s election day has me thinking deep political thoughts. After you cast your vote, what can you do in your daily life to help reject Fascism? I offer some suggestions, followed by a more detailed discussion. If you define the terms differently, see the detailed discussion and then perhaps I can translate my thoughts to your definitions. I have an earlier post on the fall of the Weimar Republic if people want to go to those details.

How to Reject Fascism

1- Resist Thinking in Groups, Part 1, Ethnicity. Individuals assert and enjoy their own rights within the polity, and those rights must be evaluated individually, or for associations freely entered into. Focusing on culturally constructed concepts of race is a foundation of Fascism. Not all race-conscious philosophies are Fascist, perhaps most are not – but all Fascists are race-conscious. Keep your group-based analysis in your sociology class, not your civics class.

2 – Resist thinking in groups, Part 2: Rights. Whether you are a fan of the English Glorious Revolution, the American Revolution, or the French Revolution, Liberals framed rights in individual terms. Each individual has the right to direct one’s own life. Each individual has rights to say unpopular things, worship unpopular gods, and publish unpopular opinions. Individual rights extend to voting for the party of one’s choice and to enjoying one’s own property. The limits of these rights are predicated upon extending the same rights to others, not some greater good. The Fascist rejects these Liberal concepts and subjects the individual to the greater good of the nation-state. Keep your group-based analysis in your sociology class, not your civil liberties class.

3 – Resist thinking in groups, Part 3: Justice.  Individuals are responsible for their own words and deeds, and only their own. Resist the temptation to hold individuals responsible for the actions of others. Resist the temptation for show trials or public smear campaigns, in which you believe the societal repercussions of the treatment of accused or of a verdict outweigh the individual’s right to presumption of innocence or due process. Each individual has a right to presumption of innocence and due process, evaluated for one’s own circumstances, not based on whatever category you want to group someone in. Keep your group-based analysis in your sociology class, not your law class.

4 – Tolerate Dissent. The right to dissent is mutual. If you want the right to hold and express an unpopular opinion, tolerate the same in others. This is more than a legal suggestion. It is not limited to government suppression of dissent. Don’t attempt to drive dissent from the public square using non-governmental means. You have no obligation to listen to anyone or to provide anyone a microphone, but you don’t have a right to prevent one person from listening to another.

5 – Don’t Invoke De Minimus Harm in an Effort to Restrict Others. This is related to tolerating dissent. If each person has maximum freedom subject to not harming others, then one way to restrict others is to exaggerate harm. Is it truly harmful that you can see the shape of your neighbor’s children’s eyeglasses while they wait for the school bus? Shall we grant you the right to ban circular eyeglasses because of this supposed harm? The community can effectively eliminate individual freedom by exaggerating every de minimus harm.

6 – Accept some Inefficiency. Sometimes, you are going to think the system got it wrong. Perhaps the majority chose the wrong option despite the advice of subject matter experts. Perhaps you think the majority got it right, but another branch of government exercised its authority to thwart the choice. People will attempt to game any set of rules adopted. Resist the temptation to undermine confidence in the system as a whole just because you think the system is inefficient in particular cases. Resist the temptation to transfer all the political decisions to people whose role is explaining available options and their consequences. If inefficiency becomes too burdensome, the system has tools for change such as elections and Constitutional Amendments. Use them.

7 – Resolve Political Issues by Ballot, not in the Streets. The streets are a great place to raise awareness. People have the right to peaceably assemble, to speak, and to petition their government for grievances. The streets are not a great place to actually resolve political issues. The Fascists took to the streets to intimidate rivals, not to persuade. If you gather a crowd on the porch of a public official’s house before dawn, don’t try to claim you did it to raise awareness or petition for grievances. At least I am not buying it. Not saying you don’t have a right to, I’m saying you are straying more toward Fascism and less toward Liberalism.

8 – Resolve Political Issues on the Merits, not with Evasions. Even if you think someone else’s opinion is due to a cognitive bias, pretend it isn’t. Address the substance of their concerns anyway. It should be easy. Maybe you are the person suffering cognitive bias. An accusation of cognitive bias is an evasion because two things can be true. First, due to a cognitive bias, Detective Columbo jumps to the conclusion that the jilted lover committed the murder. Second, the jilted lover did commit the murder. Columbo’s cognitive bias neither confirms nor rejects the accusation. Focus on the evidence.


In political discourse, confusion reigns.  The terms are so messed up that we can’t communicate.  This morning I googled illiberal liberalism.  I got over 2 million hits.  I repeated in quotes and still got over 8 thousand hits.   The fun continued with searches for fascist libertarians and liberal communists.  Turns out there are elite Davos-attending uber-capitalists who describe themselves as ‘liberal communists.’  Who knew?  Google returns New York Times columnist Thomas Friedman paired with each of fascist, communist, and liberal.  While it is OK for language to evolve and terms to change meaning, it is important to understand what concepts were embraced by the 20th century bad guys like Adolph Hitler and Benito Mussolini.  Want to avoid another Hitler or Mussolini?  Learn what they stood for, and what they didn’t. 

Fascists were the Bad Guys      

First, people my age are all about rejecting Fascism.  We grew up on comic books, movies, and TV shows dominated by WWII images.  Need a bad guy?  Stick a swastika on him.  But the lessons ran much deeper than one-dimensional comic book villains. We grew up on Burt Lancaster as a German judge in Judgment at Nuremberg coming to grips with his complicity in administering oppressive laws and in ignoring individual defendants in favor of emergency ‘societal needs’ for show trials.  We grew up on Jimmy Stewart in Mortal Storm, trying to cope with childhood buddies trained to be Nazis and who oppressed his friends, teachers, and family.  We grew up on TV mini-series like The Holocaust which could spend more time on anti-semitic atrocities, from the extreme of the death factories to smaller everyday slights.  We grew up on Charlie Chaplin’s The Great Dictator with its hilarious lampoons of Hitler and Mussolini and its inspirational anti-fascist final speech.  We grew up on best-selling books like The Rise and Fall of the Third Reich and The Winds of War.  To us, the term Fascist has political content; it is not just a label to put on people we disagree with.         

Fascism, like any political philosophy, is a way of thinking that leads to policies – not the policies themselves.  For example, spending a lot on the military, funding public broadcasting, or having national cultural councils do not by themselves equal Fascism.  The Soviet Union spent a lot on the military and nationalized cultural councils.  Communists were not Fascists.  The Western Democracies spent a lot on the military during the Cold War, and many broadcast public media and created national cultural councils (BBC? NEA?).  Post WWII Europe was not Fascist.  

Fascism emerged from the ashes of World War I.  Supplied by America’s ‘arsenal of democracy,’ the alliance led by France, Britain, and Russia fought Germany and the Central Powers to a standstill during 1914-1917.  Despite complaints of German militarism, this was not an ideological war – the French Republic and Tsarist Russia had little in common philosophically.  In 1917, the American republic replaced Tsarist Russia after the Communist Revolution. Maybe it was less of a stretch to portray the Allied Powers as representing Liberal Democracy after 1917.  

The late war change in Germany was more important.  The German Kaiser abdicated when Germany was effectively defeated but before Germany was occupied, or had signed a final peace treaty.  The Germans who formed their post-war government and signed the Treaty of Versailles were blamed by many Germans for “stabbing the country in the back.”  The Fascists capitalized on this resentment by attributing Germany’s difficulties under the Weimar Republic with inherent failings of Liberal Democracy.    

Before giving the details of Fascist aspirations, here is the context of two philosophies that Fascists rejected: Liberal Democracy and Marxist Communism.  There were many other competing philosophies, but competition between Liberalism, Fascism, and Communism dominated the 20th Century.

Liberal Democracy

In the 20th Century, the term Liberal when used to contrast with Fascist or Communist refers to the Constitutional legacies of the American and French Revolutions. The revolutionaries explicitly referenced Enlightenment thinkers.  It cannot be emphasized enough that this Liberalism had an individual view of rights, including property rights.  Both the American and French Revolutions generated written Constitutions and Bills of Rights that became models for democratic movements in many parts of the world.  Liberal governments were characterized by elected legislatures of limited authority, with guarantees of individual rights.  At a minimum, these rights included freedom of speech, freedom of religion, and due process of law.  The following excerpt from France’s 1789 Declaration of the Rights of Man attempts to summarize the scope of individual freedom in a Liberal state.

“…These rights are liberty, property, security, and resistance to oppression…  …Liberty consists in the freedom to do everything which injures no one else; hence the exercise of the natural rights of each man has no limits except those which assure to the other members of the society the enjoyment of the same rights…”

Liberalism could fracture traditional relationships.  Catholic and Protestant churches coexisting in countries formerly ravaged by religious wars?  Feudal obligations replaced by contractual exchanges?  Migration of agricultural peasants to urban manufacturing centers?  Migration of oppressed populations to more tolerant societies.  Formation of associations to promote anything from a political idea to a traditional folk dance?  Liberal ideals permitted, but did not guarantee, the possibility of cultural change and multi-cultural societies.  

Liberal ideals could also permit economic inequality.  Freedom to act differently from one’s neighbor necessarily leads to the possibility of different results compared to one’s neighbor.  Free enterprise can flow easily from protection of private property, freedom of association, and freedom of contract.  Freely arrived at inequality of property was just unless proven otherwise; rather than a person with more than average being considered unjust unless proven otherwise.

Liberal ideals could lead to inefficiency.  There is no guarantee that a popularly elected legislature that makes decisions based on majority vote will make the same choice as a subject matter expert. In some cases, the Constitution may prohibit the legislature to act even if the legislature wishes to follow the advice of experts.  The democratic process is also vulnerable to demagogues and corruption.

Shifting from ideal to practice, 20th Century Liberal Democracy had even more flaws. In some Democracies there were property and other restrictions on the right to vote.  Women struggled for the right to vote, and still struggle for equal rights.  The United States denied African-Americans equal rights, and European democracies denied rights to colonial subjects.  Even with these flaws, the Liberal impulse was for self-determination and dissent in the political realm and tolerance in the individual realm.  

Marxist Communism

Communists derived their political philosophy from the economic writings of Karl Marx and the social writings of Friedrich Engels. Communists viewed society through the lens of class struggle, not the individual. To communists, the physical mode of production determined other social relations. Oversimplifying, agriculture yielded feudal relationships, while manufacturing yielded capitalist relationships. For the world economy of the early twentieth century, Communists believed the struggle was between the capitalist bourgeoisie (owners of means of production and hirers of wage labor) and the proletariat (people owning no means of production who must sell their labor to live).

Many communists believed in a historic progression of social relationships – from the feudal exploitation of agrarian peasants to the bourgeoisie exploitation of paid labor. Ultimately, Communists believed that capitalism was necessary to destroy feudal and religious systems, but that the Capitalist economic system was unsustainable. Capitalism’s self-destruction would eventually lead to a worker’s revolution.

Communists believed that the profit motive would disappear once society was run in the interests of the proletariat. Without a profit motive, people would naturally contribute according to their ability and distribute according to need without the need of force. Of course, force might be needed until then.

Communists interpreted the supposedly voluntary contractual relations exalted by Liberals as horrific desecrations of humanity. Consider this excerpt from the Communist Manifesto.

“The bourgeoisie, wherever it has got the upper hand, has put an end to all feudal, patriarchal, idyllic relations. It has pitilessly torn asunder the motley feudal ties that bound man to his “natural superiors”, and has left remaining no other nexus between man and man than naked self-interest, than callous “cash payment”. It has drowned the most heavenly ecstasies of religious fervour, of chivalrous enthusiasm, of philistine sentimentalism, in the icy water of egotistical calculation. It has resolved personal worth into exchange value, and in place of the numberless indefeasible chartered freedoms, has set up that single, unconscionable freedom — Free Trade. In one word, for exploitation, veiled by religious and political illusions, it has substituted naked, shameless, direct, brutal exploitation.”

Communism typically opposed Liberal democracies. A Communist society was to be run by the party in the interests of the proletariat, not necessarily by the proletariat. Denying the value of individual ends, Communists saw no particular right to self-determination or political participation. A Communist government could be totalitarian, meaning the authority of the party to use the levers of the state to act in the interest of the workers could be without limit.  Perhaps when Communism achieved its goals and the profit motive disappeared, the state would wither away, but that was a long way off.

Communism typically opposed nationalism. To Communists, workers in Russia, Germany, England, America, China, etc., were all united in their exploitation by the world bourgeoisie. In their view, nationalist governments pitted worker against worker in WWI to delay the inevitable collapse of the capitalist system. A Canadian capitalist was the class enemy of a Canadian worker, not a fellow countryman. Communist antagonism to nationalism collided with Fascism. Benito Mussolini had been a member of the Directorate of the National Socialist Party until he was kicked out for advocating Italian participation in WWI.

Italian Fascism

Fascists like Benito Mussolini were extreme state nationalists. It is important here to discuss the term ‘nation’ in this context – by itself ‘nation’ did not mean ‘country.’ The term nation was used to describe an ethnic group, often people sharing the same language, religion, history, or similar cultural traditions. France was a nation-state, meaning that the extent of the French government’s sovereignty roughly coincided with the people identifying themselves as sharing the French language, history, and culture (with all due respect to French-speaking Belgians and Swiss). In contrast, the Austro-Hungarian empire was made up of members of many different nations speaking different languages, observing different religions, and practicing different cultural traditions. Examples include German speaking Austrians, Slavic-speaking Czechs, and Moslem Serbs.

Fascists had an organic view of the nation-state; the unit of action was the community. Fascists sought to create or sustain a nation-state, and promote the interests of the nation through the levers of the state. Once state sovereignty coincided with the nation, organizations independent of the state were suspect. Fascists emphasized personal duty over self-fulfillment, often cast in terms of discipline. The interests of the individual were subordinate to the community. Fascists rejected what they saw as the petty selfishness and inefficiency of Liberalism. Consider these quotes by Mussolini.

“The Fascist conception of life accepts the individual only in so far as his interests coincide with the State. . . . Fascism reasserts the rights of the state. If classical liberalism spells individualism, Fascism spells government.”

“The foundation of Fascism is the conception of the State, its character, its duty, and its aim. Fascism conceives of the State as an absolute, in comparison with which all individuals or groups are relative, only to be conceived of in their relation to the State. The conception of the Liberal State is not that of a directing force, guiding the play and development, both material and spiritual, of a collective body, but merely a force limited to the function of recording results: on the other hand, the Fascist State is itself conscious and has itself a will and a personality.”

Fascists viewed Communists as traitors, although both had a totalitarian view of state power. Communists sought to divide the nation (remember: folk) along class lines. Communists might even favor the interests of foreign workers over domestic interests under some circumstances. After the success of the Russian Revolution, some Communist parties did receive financial assistance from Moscow and attempt to coordinate internationally. Since both Fascists and Communists rejected democratic institutions in favor of struggle, the groups would disrupt each other’s rallies and fight in the streets as elections approached.

Benito Mussolini led the Fascists to power in Italy shortly after WWI. Italy’s elected parliament had been controlled by alternating Liberal and Socialist parties. Mussolini waited in Milan while armed Fascist followers, called blackshirts, disrupted opposition and intimidated the government in Rome. Prime Minister Facta, although having resigned, drew up an order declaring Rome under siege. If signed by the King, the order called upon the military to put down the Fascist attempted coup. Instead of signing the order, King Victor Emmanual asked Mussolini to form a cabinet on October 29, 1922. Mussolini’s tactics of intimidation are as responsible for the phrase ‘March on Rome’ as his train trip from Milan.

Once in power, Mussolini described the Fascist economic approach as syndicalist.  The Fascist government organized and supervised both capital and labor.  Italian corporatism typically involved formation of cartels, promotion of mergers, or nationalization of industries.  Planning boards set product lines, production levels, prices, and the size of firms.  For labor, union membership was mandatory for all Italian workers, but the planning boards set wages and working conditions.  Strikes were forbidden. 

Versailles, Weimar, and Hitler

In evaluating the rise of Hitler, recall the Fascist stress on the nation-state.  The idealistic Woodrow Wilson and the Treaty of Versailles seemed to promote self-determination and a nation-state for everyone but ethnic Germans.  Even though this view was false (other nations were shafted at Versailles), many resentful Germans saw it that way.  Remember, in this context the German nation refers to the cultural group, not the country. 

The terms of Versailles left Germany a wreck. Its government, known as the Weimar Republic, had to deal with a hyper-inflation, reparations payments, and the loss of territories, including regions that had provided significant tax revenues. Its elections were marred by streetfights. Election-related violence provided local authorities justification for restricting public speeches, and the leanings of local officials often determined who would be restricted. Despite these problems, Germany was a viable Democracy for a decade.

Communists were active from the beginning. German Communists led their own coup attempt in 1919. Called the Spartacus Revolt, German Communists took over buildings in Berlin causing the government to flee the city. In putting down the Spartacus Revolt, Germany not only relied on the formal army, but also used the Freikorps, a militia made up of ex army personnel. The leaders of the revolt, Karl Liebknecht and Rosa Luxemburg, were not the only ones executed. German Democracy would be marred by assassinations, political violence, militia streetfighting, and even the occasional right wing coup attempt or Communist revolt.

Germany’s fascist movement was known as the Nazis, or National Socialists. Adolph Hitler had participated in an attempted coup against the Weimar government in 1923. Following this treason, known as the Beer Hall Putsch, Hitler was briefly imprisoned. He used his prison time to write Mein Kampf. He blamed Germany’s loss in WWI on a mythical stab in the back, condemned weak and corrupt Liberals, asserted the superiority of the Aryan race, complained of the victimization of the Germans by foreign powers and Jews, and promised a future German Reich presiding over inferior Slavs in Eastern Europe. Hitler and the Nazis bullied and fought opponents in the streets to undermine the Republic. They recruited a militia of stormtroopers to aid their street tactics.

Matching the Ethnic Nation to the Totalitarian State

Unlike Communists who often sought the brotherhood of workers across borders, Fascists often sought to match the nation and the state geographically. Alternatively, Fascists sought control of at least one state to protect their nation when minorities in other states.

While Communists seemed narrowly focused on the effects of industrialization, Hitler and the Nazis also referred to feeding a growing population. To understand Nazi hostility to Liberalism and Communism, and Nazi military aggression, see this 1927 Hitler Speech. Notice the emphasis on matching the nation to the territory, or the territory to the nation – another reminder of Fascism as matching state sovereignty to ethnicity. Notice immigration isn’t just about allowing people to move to Germany but also emigration of Germans to more spacious territory. He complains that other states would likely use restrictive immigration policies to bar migration of a growing German population, especially states that considered themselves pro-worker.

“…it is critical for a nation that its territory correspond to its population…. “The nation needs space.””

“…Feeding a nation of 62 million means not only maintaining our agricultural productivity, but enlarging it to meet the needs of a growing population. This is true in many areas. We National Socialists maintain that industrial production is not the most important in terms of the future of the European peoples.”

“…Power is also a part of economic struggles. Power is the prerequisite to earth and soil… Even the sorrowful effort to adjust the population to the available territory by encouraging the emigration of new generations requires power, even more today as states hermetically seal themselves from the immigration of uncomfortable elements. The more economic difficulties increase, the more immigration will be seen as a burden. The so-called workers’ states seal themselves off more than others as a way of building a protective wall against cheap labor. The newcomer after all must be either cheaper or better. Here, too, one comes to the conclusion that maintaining this way of supporting the population requires power.”

“…a nation that thinks internationally, follows the path of democracy, rejects struggle, and preaches pacifism. A people that has accepted these three human burdens, that has given up its racial values, preaches internationalism, that limits its great minds, and has replaced them with the majority, that is inability in all areas, rejecting the individual mind and praising human brotherhood, such a people has lost its intrinsic values. Such a people is incapable of policies that could bring a rising population in line with its territory, or better said: adjust the territory to the population.”

With contempt for Liberal weakness and hostility to Marxist internationalism, the Nazis sought the overthrow of the Weimar Republic. They blamed Germany’s problems on Communists, Jews, and the weakness of Weimar’s republican institutions. As the Depression deepened, desparate Germans took the bait. Nazi seats in the Reichstag rose from 12 in 1928 to 232 in July 1932. With the most seats (a plurality, not a majority), Hitler was asked to form a government in 1933. Despite open hostility to republican institutions and blatant election intimidation, the Nazis were voted to power.

German Communists (KPD) had fought the Nazis in the streets of Germany. For a time, the KPD was the third largest party in Germany. The KPD leader, Ernst Thalman, coordinated with Stalin’s USSR. By the late Weimar Republic, Stalin and the KPD considered the German Social Democratic Party (SDP) as the real enemy, even though the SDP’s socialism was closer to the KPD on many issues. The KPD sought to undermine governments incorporating the SDP, even equating the SDP with Fascists in party propaganda. The KPD just wanted chaos. They felt that even if the Nazis temporarily took power during unrest, that the Communists would come to power after the Nazis. Streetfighting was designed not only to oppose the fascists directly, but to undermine the rule of law more generally.  Thalman was wrong.  Once the Nazis took power, he was arrested and his fate was doomed, along with the other German Communists.

The Nazi approach to the economy was similar to Mussolini’s syndicalism.  Major industries were “rationalized.”  That generally meant government sponsored cartels, mergers, or nationalizations with prices and output supervised by production boards.  Similarly, German laborers had to join national labor organizations, but wages and working conditions were set by planning boards and there was no right to strike. 

Free market thinkers fled the Fascists. What in the United States has become known as the Austrian School of economics was in part the result of Hayek, Mises and others escaping to the west. They left central Europe because of the hostility of Fascists to their individualism and their opposition to syndicalism. There are a lot of legitimate issues to criticize the Austrian school of economics, but calling them Fascists is like calling a Jew a Nazi.

Conclusion: How to Oppose Fascism

Fascism rejects the individual and thinks in terms of the nation-state. To the Fascist, the nation is the cultural group, often united in language, custom, and common history. Advocates of Fascism seek to match the nation to the state and use the levers of the state to promote the nation.

Fundamental American institutions rely on the individual as the unit of analysis. The Bill of Rights speaks of rights in individual terms. The system of justice is administered individual case by individual case. When discussing these issues, reject Fascism by insisting that justice and rights be defined with the individual as the unit of analysis.

The individual as the unit of analysis for political economy does not invalidate sociology. Sociologists define terms and construct methodologies for their discipline. If using the group as the unit of analysis improves theory, evidence, and analysis in sociology – terrific.

The individual as the unit of analysis does not necessarily mean rugged individualism or selfishness. Individuals are free to associate in any combination they choose. Together, they can pursue selfless charity for the poor, selfish hedonism, personal duty to the wider community, or comradery with their own ethnic group.

So go out there and speak, or be silent. Criticize each other, or praise each other. Sit on your porch, or convert it to a front room. Join a bowling league, or join a political party. But don’t cast aside America’s individualistic Liberal traditions in favor of thinking in groups.



End of the Cold War Chronology (Wilson Center) – https://www.wilsoncenter.org/sites/default/files/media/documents/publication/EotCW_Chronology.pdf

World War I casulaties – https://encyclopedia.1914-1918-online.net/article/war_losses_france#_E2_80_9CDead_for_France_E2_80_9D__the_right_to_compensation

Maurin, Jules: Histoire militaire de la France, tome 3, sous la direction de Guy Pedroncini, 1997, p. 28

Darmon, Pierre: “Une tragédie dans la tragédie. la grippe espagnole en France (avril 1918-avril 1919), in: Annales de démographie historique (2000-2), pp. 153-173.





EU unemployment rates in modern era https://www.ecb.europa.eu/pub/pdf/other/art1_mb201410_pp49-68.en.pdf

Unemployment Rates in Great Depression, Economic History Association https://www.ssc.wisc.edu/~gwallace/Papers/2120839.pdf

Paul Robeson – To You Beloved Comrade – https://www.marxists.org/reference/archive/stalin/biographies/1953/04/x01.htm

Adolf Hitler’s Speech at the 1927 Nuremberg Rally

Click to access 2120839.pdf

Memorial Duels and Constitutional Interpretation

We all have our favorite memorials. Even memorials that are not our favorites include inspirational quotes and sayings that we can use to bash folks we disagree with. Donald Kettl aims some Jefferson Memorial engravings at Justice Amy Cony Barrett and the late Justice Scalia. but his swing is way off the mark. https://www.marketwatch.com/story/thomas-jefferson-has-a-clear-message-for-the-supreme-court-about-the-constitution-and-originalism-11603988774 Even though I believe that text requires context, and believe that Congress does organize itself in committees and does include legislative reports, I don’t think the arguments of textualists and originalists should be mischaracterized. Therefore, a blog post is warranted. Mr. Kettl, I see your Jefferson engravings and raise you dolphins and a water crane.

Temperance Fountain, 7th and Indiana, NW

Disposing of Donald Kettl’s Mischaracterization of Originalism

Before I go on my favorite memorials tangent, I should say Kettl’s topic is Constitutional interpretation. Kettl criticizes originalists like Scalia and his former clerk, the recently confirmed justice Barrett. As characterized by Kettl, the originalists have too much reverence for the Founding Fathers, and as a result prevent Constitutional change. This locks the country in outmoded laws and ways of life. If Kettl is correct, the originalists would have us trapped in the Constitution as written in 1787 by misogynist racists. Except Kettl is not correct.

I was raised in the city in which the Constitution was drafted, and this was how I was trained to address Donald Kettl’s argument.

Yo, Donald Kettl, read Article V. Or, should I say read the original Article V?

That little twist emphasizing the term ‘original’ is pure Philadelphia. Oh, wait, no – I am wrong. That twist is a common human exclamation. It was snarky and inappropriate. Like Article V itself, consider my impolite expression changed to “Please see Article V for methods to amend the Constitution.” In this case, the original writer (me) was not trapped. Often, the best way to change meaning is to change words. Here is an excerpt of Article V of the Constitution.

The Congress, whenever two thirds of both Houses shall deem it necessary, shall propose Amendments to this Constitution, or, on the Application of the Legislatures of two thirds of the several States, shall call a Convention for proposing Amendments, which, in either Case, shall be valid to all Intents and Purposes, as Part of this Constitution, when ratified by the Legislatures of three fourths of the several States, or by Conventions in three fourths thereof, as the one or the other Mode of Ratification may be proposed by the Congress;

An originalist who reads Article V of the Constitution recognizes that the Constitution can change with the times, or even ahead of the times. An originalist does not believe that our Constitutional provisions are trapped in 1787. New sections can be added, old sections can be removed, and the entire document can be replaced. There can even be a new Convention. We are not trapped by the scribblings of long dead misogynist racists after all. Article V provides for two different methods to change the Constitution, neither of which refers to a majority vote among the justices of the Supreme Court.

I refer the historically curious to Hamilton’s Federalist #85 for confirmation that the Founders knew their Constitution was imperfect and included provisions for amendment. I challenge Donald Kettl et. al. to find an example of an originalist rejecting Article V, or refusing to apply the subsequent 27 amendments on the grounds that they were not part of the original document in 1787.

** Claiming that existing words are dead is not the same as claiming existing words can’t be changed.

Jefferson Memorial Tangent: Kettl’s Chosen Quotes are Good Quotes

In making his erroneous critique, Kettle invokes the Jefferson Memorial in ways that should be amplified. Jefferson and the Founding Fathers believed in the power of the human mind to reason, to direct one’s own life, to progress, and to change. Those sentiments are engraved in stone overlooking the tidal basin in Washington DC, which I encourage everyone to visit, especially during the annual Cherry Blossom Festival. Kettle should be rewarded for praising Jefferson in the current intolerant climate. It is all too likely that the accusation “He quoted Jefferson!” will be enough to brand Kettl a racist. Here are the two Jefferson quotes he chose.

“I have sworn upon the altar of God eternal hostility against every form of tyranny over the mind of man.”

“I am not an advocate for frequent changes in laws and constitutions, but laws and institutions must go hand in hand with the progress of the human mind.”

Jefferson and his contemporaries believed in changing the Constitution. In addition to Article V discussed above, more than one state made ratification of the Constitution conditional upon it being amended to include a Bill of Rights, the first 10 amendments.

Nor was the founding generation content to defer to evolving interpretations of the Supreme Court justices. For example, the 11th amendment revised the text of the Constitution to invalidate the Supreme Court’s interpretation in the case Chisholm v Georgia. Later generations followed suit. The 14th amendment’s citizenship clause invalidated justice Taney’s reasoning in the Dred Scott case. In both examples, Chisholm and Dred Scott, Congress and the states used Article V to correct what they considered invalid Constitutional interpretations by the Supreme Court.

Court Packing? What Happened to Article V?

Frustrated with Supreme Court interpretations in high profile cases, some Progressives intend to ‘pack’ the Supreme Court if they attain power. The term packing refers to expanding the size of the Supreme Court so that the current president and Senate can add a sufficient number of justices to change selected Court decisions.

Packing the Supreme Court is Constitutional. It may or may not be wise, but the size of the court is set by statute and is subject to change through standard legislative procedure.

Packing the court is not a resilient way to change Constitutional interpretation. Since 2004, the United States has had (a) Republican President and Republican both chambers of Congress, (b) Republican President and Democratic Congress, (c) Democratic President and Democratic Congress, and (d) Democratic President and Republican Congress. If one party packs the court through statute when it controls the presidency and Congress, the other party can simply re-pack the Court through statute when it takes power. By 2035, we could have 33 seats on the Supreme Court.

Using Article V to change Constitutional interpretation is more difficult but more resilient. The Constitutional text is established by a super-majority (more than 50%) and takes a super-majority to amend.

Twenty-seven times Congress has passed Constitutional amendments by supermajority, which have been ratified by a super-majority of states. In some cases, such as Chisholm v Georgia, the amendments have been directed at specific Supreme Court interpretations that a super-majority of Congress and the states disagreed with.

Partisans have their Supreme Court rallying cries. Throughout US history, Constitutional interpretation affected politics. In the early days of the Republic, partisans differed on the Constitutionality of a national bank, the authority of Congress to legislate slavery in territories, and even Congress’s power to raise taxes on imports when revenues already exceeded expenses.

Current Politics and the Court

Some of the current partisan rallying cries focus on Supreme Court decisions related to abortions, guns, and campaign finances. The problem with textual originalists, some believe, is that they will focus on the Constitution as written. But that is also their virtue. Because Kettl is wrong and neither Scalia nor Barrett would look to 1787 to interpret the 25th amendment, which was proposed and ratified during the 1960s, the originalists can be directed to change their interpretation by changing the text. Use article V.

A common objection I get when suggesting Article V is interest group politics. The late Justice Stevens, who dissented in the Supreme Court’s Heller case recognizing an individual right to own guns, wanted a Constitutional amendment to address the issue – use article V. When Stevens explained that an amendment is simple, he meant the method is clear, well known, and has been shown to be effective. Many anti-gun partisans object that the money of the National Rifle Association thwarts the super-majority in favor of “common sense” gun control. Nowhere do the anti-gun activists admit that the reason they don’t try to use Article V is that the number of pro-gun people is larger than they want to admit. https://www.npr.org/2018/03/27/597259426/retired-supreme-court-justice-stevens-calls-for-repeal-of-second-amendment

For example, I happen to be for gun control. Use Article V. As per the late justice Stevens, I suggest the following amendment and encourage readers to make suggestions. – (delete the 2nd amendment) Section 1: the military is subordinate to and governed by the civilian power. Section 2: Congress may pass laws governing the production, distribution, sale, ownership, and usage of arms. Section 3: No law may discriminate in the regulation of arms based on suspect classifications including but not limited to religious belief, race, or gender.

Consider the NRA too powerful for my suggested amendment? See my favorite memorial.

The Temperance Fountain: My Favorite Memorial

My favorite memorial is the obscure centerpiece of a skateboard park. At the corner of 7th and Indiana, NW, there is a small monument which appears to be to kind fishermen. Walking three sides of it, one sees statues and reliefs of dolphins and fish topped by a crane, all themed with water. The crown is inscribed on those three sides with the words Faith, Hope and Charity. This is one of the few Cogswell fountains remaining in the United States. Its fourth side reads ‘Temperance’ and it was built to memorialize Henry Cogswell’s temperance army, which not only inspired people to drink water instead of alcohol, his army managed to insert the 18th amendment in the Constitution banning the sale of alcohol.

To make a long story short, my favorite Memorial is to the 18th Amendment which banned alcohol. The 21st Amendment repealed the 18th Amendment on December 5, 1933. There was a sports bar on Indiana Avenue across from the Temperance memorial, and I have been known to wander over on December 5th to toast the good intentions of Cogswell’s Temperance Army while watching the Capitals or Wizards on big screen TVs.

Make no mistake about it, advocates of Temperance believed they embodied Kettl’s first quote from Jefferson. Kettl wants us to remember that Jefferson was against any tyranny over the human mind. Temperance reformers “…declared independence from the tyranny of ‘King Alcohol'” They cloaked prohibition in terms of the Fourth of July, the Revolution, and emerging science of social health. https://www.mdhistory.org/king-alcohol-temperance-and-the-4th-of-july/

Inspiration? Consider what Cogswell’s army was up against! Not only was Temperance opposed by every tavern that sold beer, many American governments relied on excise taxes on alcohol. Think about that. The Temperance Leagues defeated an alliance of alcohol producers, local governments, and Joe Sixpack.

By most accounts the 18th Amendment was a dismal failure. Alcohol distribution was taken over by organized crime. Organized crime in turn corrupted local governments charged with enforcing the Amendment. On the individual level, there is evidence that casual drinking declined but binge drinking increased, in part because higher alcohol-content drinks tended to replace lower alcohol drinks.

That brings us to the second Jefferson quote that Kettl recommends. “I am not an advocate for frequent changes in laws and constitutions, but laws and institutions must go hand in hand with the progress of the human mind.” Yes, Jefferson might approve of the 18th Amendment experiment, given changes in our understanding of alcohol and social health. But, is progress a straight line?

The 21st Amendment repealed the 18th. American governments could again regulate alcohol distribution and sales, or not. But think again about what the advocates of the 21st Amendment were up against. In order to repeal Prohibition, they had to defeat a lobby that included organized crime, the corrupt politicians allied to or intimidated by organized crime, and several major organized religions.


The Constitution is not perfect. As Kettl points out, Thomas Jefferson believed that the Constitution should be amended with advancements in human knowledge. For confirmation that other Founders agreed with Jefferson, see Hamilton’s Federalist 85, or just read Article V of the Constitution. Originalists like Scalia and Barrett have read both documents. If you think that the NRA or some other interest group is too powerful to rely on Article V, consider (1) your complaint might just be that you don’t have the votes, and (2) the Temperance League defeated a combination of the alcohol lobby and local governments. But most importantly, consider that you might be wrong.

Maybe you just want to bash Conservative justices. I am happy to bash everyone. Please join me in complaining that textualists, including most originalists, underestimate the value of committee reports and other context that prioritizes definitions. Ask me how terms like Collateralized Debt Obligation or Covered Bond have been used in securities contracts compared to how those terms have been used in proposed legislative text. But don’t try to tell me Barrett is stuck in 1787; that is a lie.

To tell me I am wrong, or just to watch the Capitals play the Rangers, I recommend meeting at the sports bar across from the Temperance memorial at 7th and Indiana, NW on December 5th. We will toast the Cogswell’s Army and Article V. Or bring your skateboard during the day. (Not during Covid – I really hate 2020)






Not Monolithic: the Murder of Bernell Trammel and the Political Views of Black Americans

This post ties together the next half dozen posts. Bernell Trammel was a Black American with eclectic political views. He supported Donald Trump nationally and a progressive Democrat in local Milwaukee elections. On July 23, 2020, Mr. Trammel was murdered sitting outside his Wisconsin shop. As of this writing, the murder is not solved.

I bring up Mr. Trammel to demonstrate that the political views of Black Americans are not monolithic. This demonstration is necessary to prevent ‘othering,’ by which I mean the psychological concept of outgroup homogeneity bias. That is a bunch of big words to describe assuming that the ‘other’ group has less range of some characteristic than the group of insiders.

The following posts describe examples of a mainstream Democrat, an anti-racist critic of liberalism, an economist who served in Republican administrations, a Green Party socialist, Mr. Trammel, and finally an essay on the importance of opposing ‘othering.’

Donna Brazille

Donna Brazille is a Democratic political strategist and public commentator. This is how her website describes her.

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Veteran Democratic political strategist Donna Brazile is an adjunct professor, author, syndicated columnist, television political commentator, Vice Chair of Voter Registration and Participation at the Democratic National Committee, and former interim National Chair of the Democratic National Committee as well as the former chair of the DNC’s Voting Rights Institute.

Aside from working for the full recovery of her beloved New Orleans, Ms. Brazile’s passion is encouraging young people to vote, to work within the system to strengthen it, and to run for public office. Since 2000, Ms. Brazilehas lectured at over 125 colleges and universities across the country on such topics as “Inspiring Civility in American Politics,” Race Relations in the Age of Obama, Why Diversity Matters, Women in American Politics: Are We There Yet.

She first got involved at the age of nine when she worked to elect a City Council candidate who had promised to build a playground in her neighborhood; the candidate won, the swing set was installed, and a lifelong passion for political progress was ignited. Ms. Brazile worked on every presidential campaign from 1976 through 2000, when she became the first African-American to manage a presidential campaign.

Author of the best-selling memoir Cooking with Grease: Stirring the Pots in American Politics, Ms. Brazile is an adjunct professor at Georgetown University, a syndicated newspaper columnist for Universal Uclick, a columnist for Ms. Magazine, and O, the Oprah Magazine, an on-air contributor to CNN, and ABC, where she regularly appears on ABC’s This Week. Her secret passion is acting; she has recently made two cameo appearances on CBS’s The Good Wife. Ask her and she’ll tell you that acting, after all, is the key to success in politics.

In August 2009, O, The Oprah Magazine chose Ms. Brazile as one of its 20 “remarkable visionaries” for the magazine’s first-ever O Power List. In addition, she was named among the 100 Most Powerful Women by Washingtonian magazine, Top 50 Women in America by Essence magazine, and received the Congressional Black Caucus Foundation’s highest award for political achievement.

She is currently on the board of the National Democratic Institute (NDI), the Congressional Black Caucus Foundation, and the Joint Center for Political and Economic Studies.

Last, but never least, she is a native of New Orleans, Louisiana. In the aftermath of the two catastrophic hurricanes that made landfall in the Gulf region, Brazile was appointed by former Governor Kathleen Blanco to serve on the Louisiana Recovery Board to work for the rebuilding of the state and to advocate for the Gulf recovery on the national stage.

Ms. Brazile is the proud recipient of honorary doctorate degrees from Louisiana State University, North Carolina A&T State University, and Xavier University of Louisiana, the only historically Black, Catholic institution of higher education in the United States.

Ms. Brazile is founder and managing director of Brazile & Associates LLC, a general consulting, grassroots advocacy, and training firm based in Washington, DC.

Ibram X Kendi

Photo Credit: Stephen Voss

Ibram X Kendi is an academic, podcaster, and the author of several books on anti-racism. Here is the about section of his website.

IBRAM X. KENDI is one of America’s foremost historians and leading antiracist voices. He is a National Book Award-winning and #1 New York Times bestselling author. Kendi is the Andrew W. Mellon Professor in the Humanities and the Founding Director of the Boston University Center for Antiracist Research. Kendi is a contributor writer at The Atlantic and a CBS News correspondent. He is also the 2020-2021 Frances B. Cashin Fellow at the Radcliffe Institute for the Advanced Study at Harvard University. In 2020, Time magazine named him one of the 100 most influential people in the world.

Kendi is the author of THE BLACK CAMPUS MOVEMENT, which won the W.E.B. Du Bois Book Prize, and STAMPED FROM THE BEGINNING: THE DEFINITIVE HISTORY OF RACIST IDEAS IN AMERICA, which won the National Book Award for Nonfiction in 2016. At 34 years old, Kendi was the youngest ever winner of the NBA for Nonfiction. He grew up dreaming about playing in the NBA (National Basketball Association), and ironically he ended up joining the other NBA.

Kendi is also the author of three #1 New York Times bestsellers, HOW TO BE AN ANTIRACIST, an international bestseller that has been translated in several languages; STAMPED: RACISM, ANTIRACISM, AND YOU, co-authored with Jason Reynolds; and ANTIRACIST BABY, illustrated by Ashley Lukashevsky. HOW TO BE AN ANTIRACIST made several Best Books of 2019 lists and was described in the New York Times as “the most courageous book to date on the problem of race in the Western mind.”

Kendi has published fourteen academic essays in books and academic journals, including The Journal of African American History, Journal of Social History, Journal of Black Studies, Journal of African American Studies, and The Sixties: A Journal of History, Politics and Culture. He co-edits the Black Power Series at NYU Press with historian Ashley Farmer.

Kendi has published op-eds in numerous periodicals, including The New York Times, The Guardian, Washington Post, London Review, Time, Salon, Diverse: Issues in Higher Education, Paris Review, Black Perspectives, and The Chronicle of Higher Education. He commented on a series of international, national, and local media outlets, such as CNN, MSNBC, NPR, Al Jazeerah, PBS, BBC, Democracy Now, OWN, and Sirius XM. A sought after public speaker, Kendi has delivered hundreds of addresses over the years at colleges and universities, bookstores, festivals, conferences, libraries, churches, and other institutions in the United States and abroad.

Kendi strives to be a hardcore antiracist and softcore vegan. He enjoys joking it up with friends and family, partaking in African American culture, weight-lifting, reading provocative books, discussing the issues of the day with open-minded people, and hoping and pressing for the day the New York Knicks will win an NBA championship and for the day this nation and world will be ruled by the best of humanity.

In 2013, he changed his middle name from Henry to Xolani (meaning “Peace” in Zulu) and surname from Rogers to Kendi when he wed Dr. Sadiqa Kendi, a pediatric emergency physician from Albany, Georgia. They chose their new name together and unveiled “Kendi,” meaning “loved one” in Meru, to their family and friends at their wedding. Their wedding photos, including Sadiqa’s beautiful gold dress, were featured in Essence Magazine.

Kendi was born in 1982 to parents who came of age during the Black power movement in New York City. They were student activists and Christians inspired by Black liberation theology. While Kendi was in high school, his family moved from Jamaica, Queens, to Manassas, Virginia. He traveled further south and attended Florida A&M University, where he majored in journalism. He initially aspired for a career in sports journalism, freelancing for several Florida newspapers, and interning at USA Today Sports Weekly, as well as in the sports sections of the Mobile Register and Atlanta Journal-Constitution. By the end of his tenure at FAMU, he had become alienated from sports journalism and increasingly interested in engaging in racial justice work. He picked up a second major in African American Studies and graduated in 2004.

After working for a time as a journalist at The Virginian Pilot, Kendi pursued his graduate studies. At 27 years old, he earned his doctoral degree in African American Studies from Temple University in 2010. Kendi has taught at SUNY Oneonta, SUNY Albany, the University of Florida, and American University. In 2017, he became a full professor, the highest professorial rank, at 34 years old.

Kendi has been visiting professor at Brown University, a 2013 National Academy of Education/Spencer Postdoctoral Fellow, and postdoctoral fellow at the Rutgers Center for Historical Analysis. He has also resided at The John W. Kluge Center at the Library of Congress as the American Historical Association’s 2010-2011 J. Franklin Jameson Fellow in American History. In the summer of 2011, he lived in Chicago as a short-term fellow in African American Studies through the Black Metropolis Research Consortium. He has received research fellowships, grants, and visiting appointments from a variety of other universities, foundations, professional associations, and libraries, including the Lyndon B. Johnson Library & Museum, University of Chicago, Wayne State University, Emory University, Duke University, Princeton University, UCLA, Washington University, Wake Forest University, and the historical societies of Kentucky and Southern California. In 2020, The Root 100 listed him as the seventh most influential African American between the ages of 25 and 45 and the most influential college professor. Kendi was awarded the prestigious Guggenheim Fellowship in 2019.

His next book, BE ANTIRACIST: A GUIDED JOURNAL FOR AWARENESS, REFLECTION, AND ACTION, is available for pre-order and will be published on October 6, 2020.

Glenn Loury

Glenn Loury

Glenn Loury is an economics professor at Brown University. He has served in Republican presidential administrations. This is the bio provided on the school website.

An academic economist, Professor Loury has published mainly in the areas of applied microeconomic theory, game theory, industrial organization, natural resource economics, and the economics of race and inequality. He is a fellow of the American Academy of Arts and Sciences and of the Econometric Society and a member of the American Philosophical Society. In 2005 he received the John von Neumann Award, given annually by the Rajk László College of the Budapest University of Economic Science and Public Administration to “an outstanding economist whose research has exerted a major influence on students of the College over an extended period of time.” He is the recipient of a Guggenheim Fellowship and a Carnegie Scholarship to support his work. He has given the prestigious Tanner Lectures on Human Values at Stanford (2007), the James A. Moffett ’29 Lectures in Ethics at Princeton (2003), and the DuBois Lectures in African American Studies at Harvard (2000).

A prominent social critic and public intellectual writing mainly on the themes of racial inequality and social policy, he has published more than 200 essays and reviews in journals of public affairs in the US and abroad. He is a member of the Council on Foreign Relations, is a contributing editor at The Boston Review, and was for many years a contributing editor at The New Republic. His book One by One, From the Inside Out: Essays and Reviews on Race and Responsibility in America (The Free Press, 1995) won the American Book Award and the Christianity Today Book Award.