All Together Now ...

What's Up With The Whig -- 'Official' edition

Yesterday's Herald-Whig splashed a story across the front page suggesting that "officials" thought the Federal Reserve's Quantitative Easing, or Q.E.--which will see $600 billion printed over the next half a year to buy Treasury bonds--was meant to weaken the dollar, and that this is why gas prices have seen a double digit rise.

The 'official' cited was the head of the Illinois AAA. Hmmm, sounds more like an orchestrated 'talking point'.

First, let's review why the Fed is engaging in Q.E. When our economy gets into a funk, it's as if everyone is waiting for everyone else to get out on the dance floor, but not wanting to be the only one out there. The federal government usually steps in and announces over the PA system that it will be offering refreshments in the middle of the dance floor. Usually, this gets people moving. Another option is for the Federal Reserve to likewise announce that it will be offering dance lessons--not nearly as welcome, but usually enough to get a few feet moving.

Critics of having the federal government involved through the 'stimulus' of refreshments say that Uncle Same offers overly expensive refreshments. Why not just let the dance happen? This is a curious argument. Surprisingly, it relies on an almost Communist altruism to do something for the greater good that no individual would otherwise do. Why be the first one to walk out on the dance floor when it's much easier to wait for others to head out there? It's simply not in your best interests to do the right thing.

The effect of no government involvement is for the economy to wait...and wait...and wait for a war or some other reason to get cranked up, meaning that we all sit on the sidelines when we could be out there dancing to full employment.

And what's the best way to have a strong economy when we're in a recession with high unemployment? Government stimulus. That's because business has no reason to hire and the unemployed can't afford to buy when money is scarce. So, the government, using the PA system, is the only one who can say "Ok, I'm counting to three, and everybody take a step out there." This can only happen, though, if there is a political consensus to do so. Unfortunately, Republicans are more interested in proving their economic theories are superior and so have time and again filibustered an adequate stimulus.

And the second best way for the government to respond? Have the Fed lower interest rates. In our current situation, though, that is of course not possible since rates are already up against 0%.

And the third best way? Print money. Normally, this could be a gateway to inflation, but in a time of low interest rates, the great danger from a recession is that deflation will occur, resulting in businesses sitting on the sidelines, waiting for prices to fall even further. Unemployment simply gets worse...and worse...and worse. When that happens, or if inflation falls to close to 0%, there's a need for more money in the economy, especially if the economic downturn was caused by a run on banks (failed banks are exhibit A in both the 1929 Great Depression and the 2008 Great Recession).

That then explains why the government is printing money. So, what's this about intentionally devaluing the dollar? It's true that a weaker dollar can be an effect of getting the economy going again, but it isn't what the Fed is trying to do. Whether the dollar is trading at 100 or 98 Chinese Yuan--or whatever the exchange rate is--is secondary to getting our economy functioning at near peak capacity.

Is the Herald-Whig intentionally harping on the increase in the price of gas? Is this a sign of it pandering to the no-doubt popular notion of government over-reach? I prefer to think it's a simple ignorance of macro-economic policy.

Gentleman's Honor

What Would Buddha Do?

It's a remarkable fact that President Obama rarely seems angry. In fact, the only time I can remember him blaming political opponents was when he was joking--and even then, it wasn't personal. Instead, he merely describes his difficulties as taking office in difficult circumstances, or having to get to work digging ourselves out of a hole. No accusatory tone, no name-calling, no finger-pointing, nothing but a focus on the future.

Given the circumstances he faces, that's amazing. The Republican Senate minority leader, for instance, has said:

"The single most important thing we want to achieve is for President Obama to be a one-term president."

And does that out-rank doing what's good for the country? Apparently so. For the past two years, and presumably for the next two, the minority leader has flouted senatorial procedure to intentionally slow the legislative branch to a crawl, has collaborated in holding up government appointments and in general acted in bad faith.

If President Obama's disciplined calm weren't genuine, though, he'd occasionally crack, as his opponents got under his skin. But no....

Nor do I expect him to tout his reserve. That, too, would go against character.

But surely a pundit or vocal voter will eventually notice, that at least at the White House, the tone in Washington has indeed changed.

Take It To A Higher Level

Voting -- Stone Age To Modern

As a close observer of the political scene, it puzzles me why, in an age of on-line surveys and surprisingly accurate polling, some enterprising member of the House of Representatives doesn't choose to 'listen in' on and occasionally align him- or herself with the will of the people.

The first step might be to pick a high-profile vote that would attract lots of attention, say, the recent vote on health care reform.

Our representative would invite voters to register at a website that would verify their being residents in a legislative district, would introduce them to the subject to be polled, provide arguments for all sides, then poll the issue, with an opportunity for feedback that could be accessed and ranked by subsequent viewers. Registration would include several questions regarding the participant's socio-economic background, to be used by a polling firm to generate a representative sample of voter opinion. Our representative could then, at a minimum, say that he had listened to his constituents, and could even tout his ensuing vote as the will of the people.

Before we address the possible problems with this scenario, let's follow it to its conclusion. Our representative now invites civic organizations of all kinds to submit short videos on specific or more general topics tied to impending legislation; these are then chosen or rejected by congressional staff.  Other representatives would then follow suit, the universe of issues to be polled would expand, and soon the House of Representatives becomes an institution that listens, educates and shapes opinion, rather than propounds and fundraises.

While there would be, under this scenario, a minimum of candidate fundraising, an electoral challenger couldn't very well focus on an incumbent's votes, since many votes would be 'of the people'. This would tend to focus campaigning on issues, rather than the typical accusations aimed at an incumbent, which can all too often involve assertions regarding personal character. So, even though opponents could challenge the style or substance of video presentations, the charge: "stop lying about my record" would be much less likely.

Meanwhile, those representatives who didn't abide by the learned opinion of their constituents would be hard-pressed by challengers who promised that service.

And soon presentations would be 'signed on' to by any representative who agreed with the content (videos adapted for different legislative districts).  Eventually, as more and more issues were covered, voters would have a better and better understanding of the issues and would vote accordingly.

This, then, is the organic way for major progressive change to occur. When enough voters understand an issue well enough to see through deceptive ad campaigns, and vote accordingly, there is no hope for the dishonest politician.  A good example would be Climate Change.  Much of the opposition to resolving the problem comes from the fossil fuel industry, with its money and influence difficult to trace.  Low information voters are easy prey for campaigns that protest government meddling, red tape and exaggerated cost.  But the more one studies the issue, the clearer the science becomes and, one soon realizes, the more self-serving the motivation of those holding back progress.

And now for the problematic nature of our proposed scenario.

* Could tabulated opinions be nefariously 'adjusted' after being tallied, perhaps by hackers or by the representative himself?

The hang-up in moving to on-line voting has always been that unlike using a credit card, the receiving end of the equation must maintain voter anonymity, which is near impossible to do without compromising security. But, a representative hearing from her constituents is allowed to know how they feel on a given issue. So, the transaction is more akin to that involving a credit card, with secure, verified information, and thus very doable.

In fact, verification could also involve re-sending voter opinion back to the voter in question, automatically, the way one receives a confirmation e-mail when ordering something on-line.

* Could on-line voters simply lie about where they lived? 
Not likely. Once a voter's address is entered at the polling website, and checked against a database of residents, a 'pin number' could then be mailed to the address.

* Could poll-takers lie about their socio-economic identity? While this would seem to be an obstacle, polling could be based on both collected data and residency (the latter is the way congressional districts are often drawn, with census data used to identify subsections of the population).  In other words, the polling organization would use both reported information and a 'guesstimate' based on census data.

* Could polling organizations be trusted to get it right?

Polling could involve a transparent process of plugging in raw data that anyone could examine after the fact.  Thus, the polling firm hired by a representative would only come up with a formula that is then used when determining individual outcomes that the firm would have nothing to do with.
This formula would be a model that any other polling firm could examine.

And if this were a problem, the raw data could be crunched by multiple polling firms and the results averaged.

* Could important issues receive too few votes for the polling data to be meaningful? 
This would be a problem initially, and our representative could simply vote as they saw fit, when needed; but over time, there'd likely be enough participation.

One fun idea would be to sign up each opinion generator, by default (a box could be clicked to opt out), in a lottery that paid out, say, ten $10,000 prizes each month in each congressional district. This would encourage those less likely to participate.  The cost would be $1,200,000 x 438 = $523 million.

Update (8/24/14): There have been reports that the city of Los Angeles is considering a lottery idea to increase voting in local elections (it would be illegal for elections involving federal offices).  Luckily, our idea does not involve actual voting. 

* Wouldn't voters tend to skip over the presentation when voting, just to be entered in the lottery?
This would seem to be a problem until one realizes that all political activity is based on an educated electorate.  People can't be forced to understand an issue and The People receive the government they deserve.  Besides, there is probably a tech fix.

* Wouldn't the same voters, especially those who have plenty of time to vote, make up the bulk of the sample? 
Yes, but the beauty of a well-done poll is that it filters out bias. So, no matter how many issues you vote on, the 'formula' would randomly select your vote only when it needed a 43-year-old Native American female making between $30 - $50,000.

* What about those without a computer? 
By the time this idea is more than an experiment, computers at libraries and community centers would likely be able to handle those without one.  Besides, while the raw data might be missing for the computer-less, their racial, socio-economic and age groups would be adequately covered, thanks to census data. 

* Wouldn't Republicans disproportionately benefit? 
Since Democratic congressional districts are more apt to be overwhelmingly Democratic (in urban areas), it would seem that Republicans would tend to have more districts where a representative's persuasive power could be put to use. But, it could also be claimed that, to a degree, Democratic ideas tend to rely on knowledgeable voters able to understand in-depth issues, so, raising the level of voter education will likely be to their advantage.  Result: neither party benefits.

How long will it be before a representative opts to take politics to a higher level? And how long after that before the entire House of Representatives sorts through the issues of the day using polling input from constituents? Could the House become the thinking mind of the body politic in our lifetime?