The Elite Catch-22

Plus, you can't fire Biden, he quits; and, the woeful state of economics reporting...

Below, my thoughts on Biden’s backward backdown, and my sympathy for economics reporters still calling Larry Summers for comment. But first…

THE ELITE CATCH-22

An ugly undercurrent on the corporate Right has always pushed the absurd position that members of the elite—Americans with the highest incomes, the most university prestigious degrees, the positions of power—must not criticize their own, challenge the justice of the system that has blessed them with success, or attempt to speak on behalf of the common citizens ill-served by the status quo.

The grumbling burst into plain view over the past few weeks, amidst the solidification of the Republican Party’s turn toward populism, my own New York Times essay on “This Is What Elite Failure Looks Like,” and Senator JD Vance’s elevation to the presidential ticket.

“You can’t criticize elites when you are the elite,” says Avik Roy, Foundation for Research on Equal Opportunity founder and president. “You’re the ones who are having disproportionate influence in the conversation.”

Scott Winship, director of the Center on Opportunity and Social Mobility at the American Enterprise Institute warns, “if you’re in the top fifth of the income distribution, I’m sorry, but I don’t want to hear your play-criticism of ‘elites,’” while his colleague Stan Veuger observes, “funniest thing about the New Populism is it’s Yale JDs all the way down.”

In an extended post on Twitter, Heath Mayo, an attorney at Wachtell Lipton and the founder of “Principles First” goes furthest of all:

I typically try to assume good faith and engage critics on the merits of their arguments, but here such an assumption is clearly inappropriate and the argument lacks merit with which to engage. So to be blunt: This is gross, and doubly so for what it says about the environment in which these folks are all operating. Let’s count the ways:

1. Beginning with the straightforward, it’s an ad hominem attack. It has no bearing on the underlying critique of the elite that it seeks to defuse.

2. But it’s also a particularly toxic form of ad hominem attack, because it seeks to disqualify honesty and introspection. It’s quite the defective worldview, and misunderstanding of one’s own role as a public commentator, that sees someone criticize their own tribe, against self-interest, as cause for suspicion. Do you have to think all Yale lawyers are going to be a good Yale lawyer? Is it that hard to imagine someone who earns more than $100,000 questioning the basis of six-figure incomes?

3. Note that this policing of who can speak for whom is precisely the behavior exhibited so frequently and foolishly on the Left and otherwise rejected on the Right. At least the Left then makes a point of finding speakers to elevate who can represent otherwise marginalized groups. The plan here seems to be to just ensure the issues do not get discussed at all.

4. Indeed, the position that elites cannot be taken seriously in criticizing the elite, or leading populist movements, creates a Catch-22. Elites must defend the elite, while non-elites get dismissed for insufficient understanding and inability to communicate their views in terms the elites will accept. Unsurprisingly, the same people who refuse to hear criticism from the elite also deride the common citizen for grievance and nostalgia and not understanding how wonderful everything is. What critique of elite failure would these self-appointed gatekeepers accept? None. And that seems to be the point.

What sort of institutional environment incubates such nonsense? Welcome to the corporate Right, where “profits [are] the mother’s milk of prosperity” and “cheap labor leads to a booming stock market? That benefits everyone.” The market is operated for the benefit of the winners, and if you are one, it is the height of ingratitude to do other than keep the gravy train rolling.

Mayo’s comment is particularly telling in this regard: “JD Vance’s own personal story from holler to high finance refutes the notion of American decline he tries to sell. … America gave him immense opportunity and he was able to seize it. … It’s a shame Vance now insults for political gain those who helped build his.”

But as Vance said in his Republican National Convention speech last week: “Things did not work out well for a lot of kids I grew up with. Every now and then I will get a call from a relative back home who asks, ‘Did you know so-and-so?’ And I’ll remember a face from years ago, and then I’ll hear, ‘They died of an overdose.’ As always, America’s ruling class wrote the checks. Communities like mine paid the price.”

For Mayo, a system in which one J.D. Vance makes it to the top is self-validating and, from the top, Vance’s task is to shout platitudes down to all those who cannot possibly make the same climb. For Vance, the system’s efficacy is measured by its failure for the majority left behind. For conservatism to succeed, politically and substantively, it must transit the vast distance from the former to the latter. We are making progress.

BIDEN’S BACKWARD BACKDOWN

After last month’s presidential debate, attention turned predictably to the question of when President Joe Biden would abandon his re-election bid. For pundits obsessed with the horse-race, and news organizations chasing clicks, this was the best sort of high drama. But for the health of the American republic, that question is not nearly as important as whether Biden will resign the presidency or be forced from office via the 25th Amendment in the coming weeks.

Joe Biden is free to run for office, the Democratic Party is free to nominate him, and the American people are free to reject all that at the ballot box. There’s no actual problem there from a constitutional perspective, only from a partisan one—if you’re a Democrat, the result is disastrous. So, perhaps unsurprisingly, that’s what the Democrats have focused on. But it’s painfully obvious that Biden is not capable of discharging the powers and duties of his office. As I wrote a few weeks ago:

Discovering that a candidate literally cannot do the job is a revelation of a different kind, particularly when that candidate already holds office, and that office is vested with the executive power of the federal government, including as the commander-in-chief of the Army and Navy of the United States. Unique in our constitutional system, the president has sole decision-making authority within many of the government’s most important functions and on those issues with the highest stakes and shortest response times. This is not Diane Feinstein hunched in a wheelchair, as one senator out of one hundred, or Ruth Bader Ginsburg not retiring at the time, affecting the partisan balance of the court.

The spinning about Biden’s election chances is the fun and easy part. But the hard question, and the one it’s hard to see how Democrats duck for the next six months, is whether anyone is actually in charge in the White House. Politicos are notoriously bad at thinking beyond the talking points that will get them through their next two-minute cable TV appearance—just look at how many figured they should just insist that Biden is still sharp as a tack, which was obviously not a position they would actually be able to sustain. If American journalism is not too far gone as well—and who knows, given the insane effort in recent months to hide from the nation the reality of the president’s condition—this is what every reporter will be asking about, every news organization clamoring to investigate.

Ironically, Biden resigning the White House but carrying on his election bid would have been the more legitimate course of action: He can’t do the job, but, dammit, he’s asking for your vote. Conversely, ending a presidential bid for the sake of a partisan interest while refusing to step down from office for the sake of the national interest is abhorrent—the Defenders of Democracy(tm) saluting it are reminding us all once again that it is only the defeat of Donald Trump that interests them.  

Hopefully he resigns in the coming weeks—prior to the Democratic National Convention would make sense, if he indeed wants to see Vice President Harris receive the nomination. Dropping out isn’t patriotic, it’s taking your ball and going home when the other kids start running up the score. Stepping down—that would be worthy of the applause being handed out too cheaply right now.

PITY THE POOR ECONOMICS REPORTER

It’s fun to watch reporters struggle with economics when the economists they rely on don’t have anything useful to say about it. The effect is greatly compounded by the shifting ideological valence of the issues, with Republicans now needing to be condemned on grounds that Democrats just yesterday would have been applauded. Good luck finding the in-depth analysis worrying that a Democratic push for greater union organizing would be “inflationary,” or the concern that too much investment in job training would boost productivity too high, thereby reducing the demand for work. But now that Republicans are interested in tight labor markets, worker power, and rising wages, surely something must be wrong.

New York Times political writer Jonathan Weisman delivered a spectacular example last week, reporting from Milwaukee: “J.D. Vance, the Republicans’ vice-presidential nominee, wants to center the working class in a Trump second term, but economists on the left and right question whether his prescriptions would actually help.” Citing Vance’s focus on raising wages and reshoring manufacturing through tariffs and immigration restriction, Weisman warned readers, “to some economists on the left and the right, the policies might have political appeal to blue-collar workers, but they are economically incoherent and inherently inflationary, and will ultimately harm the people they purport to help.”

Of course, Weisman’s economist of the “left” was center-left neoliberal Larry Summers, who has been as consistently and loudly wrong about globalization as any economist of the past 25 years. Indeed, in American Compass’s “Wrong All Along” project documenting the most embarrassing views on globalization from across the political spectrum, Summers appears repeatedly. “It has sometimes been remarked that asking five economists a question will generate ten different answers,” he wrote in 2000 while serving as Secretary of the Treasury in the Clinton administration, “on this issue there has been only one answer: that welcoming China into the global economic system is right for the American economy and for the global economy.” He added, “the economic and commercial benefits of granting [Permanent Normal Trade Relations to China] are significant and all on the side of US businesses and workers.”

Unsurprisingly, then, a refusal to follow his terrible advice earns low marks from him. “It’s a maximal prescription for stagflation,” Summers tells Weisman. “It brings together the worst of macroeconomic irresponsibility, the worst of a supply-side shock populism and the worst of anti-business diminutions of confidence.”

From the “right,” Weisman highlights center-right neoliberal Doug Holtz-Eakin, a senior adviser to John McCain’s 2008 presidential campaign. Holtz-Eakin doesn’t offer any substantive critique of Vance’s working-class agenda, instead providing Weisman the bromides that “it uses the power of the state to solve all our problems” and “what is absolutely missing is consumer sovereignty, the respect for individuals to make private decisions.” That’s not economic analysis at all, but misapplication of a political ideology to a set of policy issues where it makes no sense. How, besides the power of the state, would one set and enforce immigration levels or manage trade with Communist China?

Having gotten no substantive argument from his economists, Weisman attempts to piece one together himself, which is when the article takes a bizarre turn.

“Decades of economic research have also raised doubts that immigrants — especially undocumented immigrants — really suppress domestic wages. Most immigrant labor goes to work Americans don’t want, like in farm labor and meatpacking,” explains Weisman. But if immigrant labor doesn’t suppress domestic wages, how would its absence be inflationary?

“And the manufacturers that exist, facing higher-cost workers, would be encouraged to modernize with robotics and artificial intelligence, becoming productive without many workers,” he warns. But that’s, that’s exactly the point! Tighter labor markets, fewer workers, higher investment, higher productivity, higher wages… what exactly is the problem here?

When reading the economics coverage over the next few months, always watch who is being quoted and what they are arguing. Is it someone whose entire career and credibility was built getting the answers to our key economic policy questions exactly wrong and, if so, do they explain how the argument they are making now differs from the one we already know is incorrect? Are they even making the case for why a particular policy will have a particular effect, or merely reciting orthodoxy as self-evidently true?

As the physicist Max Planck observed: “A new scientific truth does not triumph by convincing its opponents and making them see the light, but rather because its opponents eventually die and a new generation grows up that is familiar with it.” Journalists who serve as stenographers for the outdated economic orthodoxy will be leading readers astray for the foreseeable future.

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