The blog papers of dr. Michael Sakbani: economics, finance and politics

Dr. Michael Sakbani is a professor of economics and Finance at the Geneva campus of Webster-Europe. He is a senior international consultant to the UN system, European Union and Swiss banks. His career began at the State University of NY at Stoney Brook, then the Federal Reserve Bank of New York followed by UNCTAD where he was Director of the divisions of Economic Cooperation, Poverty Alleviation, and UNCTAD`s Special Programs. Published over 125 professional papers.

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Post-Trump America; a Clarion Call for Reconstruction

Dr. Michael Sakbani

A Presidential Term Between Two Lies and an Insurrection Finale

Twentieth January 2021 is a date in American history that will be long remembered. It is the day that American Democracy broke out of the unsettling Presidency of Donald Trump. One all of the sudden felt that the normal is hopeful and the troubling reality is no more. It had been a ride like no other in the 232 years of the Republic. A President who adhered to no norms and respected no institution of governance began his term with a big lie, that he won the popular vote, and ended it with a bigger lie that he won the 2020` elections. The last act of his reign was to incite an insurrection against the US Congress when it convened to authorize the states elections results. the mob he incited were animated by lies he perpetrated for three months for which he earned a second, and this time, bipartisan impeachment.[1]

Trump is perhaps no more, but Trumpism has millions of voters. The 74 million voters he got are a mass of fact deniers. However, they are not a homogeneous lump of fanatics. Some of them are white supremacists like the Oath Keepers and the Proud Boys, Some are misinformed nationalists, Others are struggling people with numerous difficulties. Some are evangelicals led astray and some are Republican voters afraid of the Democrats` left. What is common among them is that they believed the lies of the President, they mistrust the media and the Government. They acted out of a mixture of fears, disgruntlement and bewilderment, many believed in the conspiracy theories espoused on social media. But their drama was not instigated by Trump alone without his enablers. It was the Republican Party leadership, Senators and Legislators, who kept mum about the lies and distortions for four years, and refused to stand up for the truth of the election results. Sadly,they failed the so many gullibles who believed the fictions spanned by Fox News and other RupertMurduch news outlets.

A common thread weaved through the politicians among the enablers: they all feared the Trump-base regarding their political careers.

A Party of Collaborators or of Lost Identity

President Trump hid nothing of his character or beliefs. Before the elections, he had championed the Birthers movement alleging that President Obama was not American- born. He was the host of a brash TV show and a veteran of bankruptcies, multiple divorces, sexual affairs and business scandals. After the elections, he banned Muslims (1.8 billion of the world population) from entering the USA characterizing them as terrorists. He called Latino immigrants thugs, druggies and rapists. He expressed his disdain for African immigrants by branding their countries as “shit- holes”. After the Nazi-Anti-Semite riots of Charlottesville, he declared there were fine people on both sides. Before the elections, Trump declared that any election he does not win is a fraud. He came out against mail -voting practiced by several states as illegitimate and insisted that it should not be counted- (he himself voted by mail)- even though there has been no fraud in mail voting in the history of the land. Throughout all of these, the leaders of the Republican Party did not disavow him and were non pulsed about his declarations, lies and acts.

On the day of the elections, he declared himself the winner after the polls were closed but before counting was complete; he declared he won a landslide and demanded stopping the count !!!. The Republican leadership maintained its support and many elected Republicans supported the lie of the President. Past the safe- harbor day of the electoral college vote on December 5, no Republican leader had called Joe Biden President-Elect (Sakbani,1)[2]. The President launched 62 cases alleging fraud, all of which except one, were tossed out by the various US courts including the USSC for lack of evidence[3]. Yet Republican elected officials maintained their support of his lie. After the Electoral College vote was certified by the Governors and legislatures of the states on December 15, a frivolous case was launched by the Attorney General of Texas against three other states claiming their vote was injurious to Texas, The Republican AG`s of 17 other states along with Mr. Trump plus 126 Republican House members supported this contention. It is noteworthy that 14 of these representatives only objected to votes cast for Trump but not to those cast for themselves in the same elections in the same states. The US Supreme Court unanimously dismissed the case in one short paragraph( A. Liptak)[4].

Finally, running out of means to challenge the results of the most secure and free elections in US history, he called the State Secretary of Georgia to ask him to find 11780 votes for him threatening him with criminal prosecution(CNN, MSNBC, CBC, ABC and Ass. Press)[5]. In the US` Senate, 13 Senators led by Ted Cruz of Texas and Josh Hawley of Missouri, supported by two-thirds of the Republican House members, sought to challenge the certification of the Electoral College by the US Congress. Their claim was that the millions who were lied to by the President and by themselves, deserve re-examining the results!! (Cruz.)[6] The President called on his supporters to back this effort to block the certification by coming to Washington to stop the steal.on Januar4y 6. When they gathered near the White House, the President, his son, his lawyer Rudi Giuliani, and congressman Mel Brook of Alabama, all whipped up the crowd and asked them” to march down Pennsylvania Avenue to the Capitol and fight hard to reclaim their country and its stolen elections”.(Associated Press)[7] March they did, with abundant zeal, aroused anger and overflowing determination. At the Capitol, they smashed their way into the building breaking everything in their way, killing five people and calling for hanging Vice President Pence and assassinating Speaker Nancy Pelosi. The President reportedly - Senator Ben Sasse, Republican of Nebraska- was gleefully watching the events on Television. He did not take repeated calls from the beleaguered Congressmen, including Kevin McCarthy, for him to stop the mob and call the National Guard(Avlon).[8]

After this insurrection against the US Government, the Congress reconvened but these legislators persisted in their objections, which of course failed. The Vice President declared Joseph Biden the official winner of the elections and hence, the 46th President.

The Republican party emerged from the Trump presidency without its old conservatism and with right-wing mob followers “commercing” in conspiracy theories. This politics of lies, nastiness and partisan war-fare has been seeded in the Republican Party by the 1992 Gingrich wave and has now come to full fruition under the demagoguery of Trump. Now the abiding question is will old-line Republicans recover their party or is it going into the Trumpian - Qanon conspiracy sphere. The easy solution is to continue winning elections by manipulating districts and restricting voting so that they can keep power as a minority body. The difficult, more healthy and lasting way is to embrace the multiracial and multireligious reality of America and offer policies that appeal across a wide spectrum.

A Country Festooned in Anger and Discontent

Since the end of the US civil war, many Southern Senators and Southern States officials embarked on reinstalling segregation in their region. By the 1960s , Jim Crow was doing well in the South up till the civil-rights movement. After the voting right act of President Johnson, the South was ready to flip Republican. President Nixon Southern Strategy was indeed to turn the South into a Republican heartland permitted to go back to the old practices under Republican laxity. One of the pillars of that was disenfranchising black voters. If the Republican Party is faced with unsurpassed demographic changes, then it should suppress black and minority votes as a way to get to power and to keep it. This practice spread out of its Dixy birthplace to other regions. In our days, Pennsylvania, Michigan, Ohio, Missouri, Oklahoma, Texas, Florida, Georgia, South and North Carolina have indulged in voter suppression. Voter suppression was added to the gerrymandering of election- districts to produce minority rule for the GOP. Except for the US presidential elections of 2004, the Republicans have failed to get a national majority in the last eight Presidential races. Along with the small-state bias of the Electoral College, the minority Democrats in the US `Senate represent more than 10 million more Americans than the majority Republicans with a similar but lesser margin in the Lower House. This is the Republican dilemma: how can its leaders eschew the facile strategy of winning elections in the short-run by hook and crook in favor of appealing by policy offerings to a majority of diverse voters.

President Reagan campaigned in the 1980 elections on the theme that the Government was the problem and not the solution. This plank reinforced the Individualist Americana mantra of anti-government. In the mid -1950s, the US government employed 5% of working Americans who served a population of about 170 million. Nowadays, the figure is 2.5 percent serving 330 million (Sakbani,2; Zakaria)[9]. The Covid-19 epidemic showed that the non-military parts of the Government are poorly financed and understaffed. And this same seminal occurrence showed that it is the Government to which people turned in the crisis as the principal actor in protecting and managing the society and supporting its economy.

Trump gave a focus to the anger and fears of several strata of Americans. The first of these are blue-collar workers whose job insecurity and diminished prospects drove them away from the educated and well-off Democrats. These so-called “Reagan Democrats” found once more a champion in Trump`s protectionist policies, and “America First” rhetoric. They also had a favorable echo to his anti-immigration advocacies. With the disappearance of most labor- Unions and corporate America`s enthusiasm for transferring jobs to cheaper places abroad, Trump`s nationalist protectionism found them in the target.

The second stratum was white voters whose identity and privilege and even religious beliefs were threatened by immigration, minority overreaching and tolerance of the LGTG. To be told that they will be a minority in 2045, stirred their anxieties and attracted them to the authoritarian Trump with his message of making “ America Great Again” with its sub-tunes of White reassertion. This stratum is composed of several subgroups. Some are right-wing racists with White Supremacists bent: the Proud Boys and the Oath Keepers, many are gun- owners opposed to gun controls. Others are anti-government individualists who back their beliefs with their guns. And still, others are people crushed by their poor economic circumstances and difficulties (Pavette)[10].

A third stratum was the evangelists whose triple - issues of packing the courts with conservative judges, outlawing abortions and pro-Israel foreign policies voiced out by Trump to prepare for the coming of the Messiah in occupied old Jerusalem. held sway. Despite his sacrilegious persona they received with credibility his claim, “I am the chosen one”; the sinner fulfilling the work of God.

The fourth stratum was the business and traditional conservatives who wanted lower taxes, fewer government controls, dismantling of environmental restrictions and reduced expenditure of Government on social programs. Trump dared to advocate all these things unlike the usual Republican elected officials.

This is the coalition of discontents for whom Trump was a political hero who dared saying all the politically incorrect things and whose election was the road to a safe White America.

A Post Trump Program of Action

On his first-day office, President Biden owned the virus problem. He signed and promulgated an action program of national leadership, held sway, communication, mask-wearing, testing for infection, distributing the vaccine and vaccination and using the NDP act for producing what is needed. The sad surprise was that Biden`s team found no vaccination- plan and no testing- plan. They simply have to start from zero.(Zietent, CNN)11

President Trump left to his successor a heavy burden of a broken state. The first order of business is to control the epidemic and achieve herd- immunity through vaccination. Trump gave up on that last March. He is leaving with a death toll of 410,000 running a daily rate of 3500 and a hospital- system stretched to the limits (CDC)[12] The Federal Government under Biden has to lead the fight as advised by the scientists, coordinate actions of all the states and mobilize all the national resources to test and vaccinate people and break the hold of the epidemics.

The second crucial task is reopening the economy and rebuilding both the aggregate demand and aggregate supply in tandem with controlling the virus. Biden`s proposal of another $1.9 trillion to support the economy is the right move at this time. It should aim at helping unemployed workers by extending unemployment benefits, re-floating small businesses, securing testing and vaccination, supporting state and local governments and alleviating the stress of insolvable mortgage holders and the hospitality-travel industries.

There will be the expected opposition from Republicans crying out the evils of deficits. But this is politics as seen before: the deficit is bad when the Democrats are in power and forgotten when the Republicans are in. This happened during Reagan, Busch jr and Trump, each of whom ran a record deficit. Nonetheless, the chorus will be less loud this time, because the case is very strong. Most economists have settled in recent years on the proposition that there should be no apriori characterization of the fiscal deficit. The Federal fiscal deficit may be good or bad, all depending on the cost of borrowing, the rate of return on the deployment of the borrowed funds and the timely necessity for borrowing If Biden should have learned a lesson from the Obama years, it is that a halfway is no way. The Recovery act of 2009 was too little.

After the confusing spectacle of fifty states with fifty different election systems, it is time to reform the election system. There should be standardized rules and protocols governing elections for the fifty states. Mail voting should be streamlined with standardized periods of reception, sorting, counting and delays. There is merit to taking out election supervision from politicians to judicial supervision. Voters identification and simple registration procedures should be enacted like in most European countries in places of residence. Perhaps it is time to enact a new voting right legislation to solve all the above problems. Gerrymandering has become a partisan game sapping the fairness of elections. A good proposal is to draw up districts by independent commissions in full transparency.

A fresh look at the Electoral College despite the known difficulties of a Constitutional amendment is a good thing to do later on in Biden`s term. There might be acceptance by the smaller states for a step -function increase of EC voting by giving one more vote for every, say, 5 million inhabitants over the first initial 5 million [13].

The Biden^s administration has to revisit the affordable health- care act. Universal health coverage through a system of multiple payers where private insurance schemes along with a viable operational public option is not a pie in the sky. The US remains the only developed country with no universal health- care. The system in place needs radical reforms in purchasing drugs, delivering health services and reducing the 18% of the GDP spent on a health- care system that performs unsatisfactorily and costs a third more than the next expensive advanced - country system.

There should be a frank and informed debate about the US tax system and the Federal budget especially as pertains to the military budget and the social entitlements on the expenditure side and the tax rates of the high income, high wealth tax-payers on the revenue side. The US has a revenue-starved tax system in which the Federal Government does not spend on essential services like public health, high education and infrastructure. Revising the tax rates would also help in dealing with the gaping income distribution problem of the US (Sakbani, 3)[14].

Two other areas of critical importance are investment in infrastructure and in environmental green- technology. The US should not only rejoin the Paris Accord but develop plans to increase public and private investment in these two areas. Public investment can play a catalytic role in attracting private investment at inception. Millions [mS1] of jobs can be created in these areas. At the prevailing low-interest rates this investment has a high rate of return and will be a boost to scientific advance. The President might find bipartisan support and business enthusiasm for such investments [15]

Immigration reform has been long in coming. There was a bipartisan attempt several years ago which ended up on Mitch McConnell`s desk. This reform should provide a solution to the DECA immigrants. The Biden administration promises to try immigration reform. It is an educated guess that the Republicans might support a bill that makes a clear distinction between economic immigrants and other categories such as refugees and candidates of merit as deemed by the US. Immigration policy should be determined to a certain extent by the needs of the country and by the social expenses incurred by immigrants [16]. Advocates of open immigration cite the US historic traditions. of reception. However, the US of the 19th and early 20th centuries is not the same as the USA today with 335 million inhabitants and a nonexpanding frontier.

The question of social media platforms is receiving urgency after social media platforms banned Mr. Trump’s accounts. The question is whether the First Amendment gives license to incitement for violence, for hate-speech, for speech disrupting the public order. Chief-justice John Marshall opined that shouting fire in a crowded -theater is not an exercise of free speech. This was what President Trump`s tweets were. Mr. Trump defense that his pronouncements are an exercise of free speech does not hold. Free speech is defended by the Constitution, but not incitement and hate speech.

The money- making social media platforms need thoughtful regulations by Governments. It is not a simple free-speech question, rather one of public order. This is beginning to happen in Europe but is lagging in the US. President Trump has shown how effective is the use of social media platforms in spreading lies and creating confusion and even in inciting an insurrection. After his Twitter account was closed on the 8^th of January, his approval rating dropped 9 points in 9 days to 32 % according to a CNN poll (Chalian)[17]. To be sure, the riots of 6 January might have caused that or at least contributed to it, but it is clear that as he fades away from the public view without his Twitter, his disruptions will diminish and his popularity will wither. There is herein a clear lesson in how the social order can be impacted by unfettered social media.

President Trump was impeached for the second time on Wednesday 13 January 2021 by a bipartisan vote. His trial in the US Senate, however, was not scheduled by Mitch McConnell to start before leaving office. By so doing McConnell deliberately postponed the trial till after January 20 in order to furnish the Republicans with a pseudo Constitutional excuse not to convict Trump!!! There is to be sure, a Constitutional question not totally settled: whether a President can be convicted after he left office. The majority of scholars opine that the Constitution had a double purpose of impeachment: vacating the office and barring an ex-President from future public office. Professor Laurence Tribe of Harvard Law School holds that a conviction after leaving office has legal precedent and fulfills the intents of accountability for high crimes and misdemeanor of the Constitution. (Smerconish-Tribe)[18] From a layman's point of view, it is important that he be held accountable for his incitement of insurrection and be consequently barred from public office. If leaving the office means escaping accountability and punishment then we would be in a lawless place, in which any President can escape accountability by quitting in January.

Student Debt and the un-affordability of high education costs for the vast majority of Americans is another pressing issue. When the author went to graduate school in the mid-sixties to the early seventies, the costs of tuition, registration fees and books were in real prices, only one-eighth of what they are today. That is why student debt is now $1.7 trillion. Education is a supreme public good. The state should shoulder this burden by direct financing of public institutions and helping out private ones. This is an issue that affects 40 million Americans and all the credit - banks. It needs airing and action.

US Democracy in Peril

How did it happen that a flawed man with a long history of provocations, unconventional behavior and penchance for lying can attain the supreme magistrate of a Democracy through free and fair elections? We do not live in a Plato Republic, but it is right to ask how can democracy be protected from such individuals?

American democracy has a classical and Anglo-Saxon heritage whereby democracy`s health depends on the respect of the civics rules of politics. This is a form of political virtue in which the public good is placed above the private and factional interest and truth rules the public discourse. Today, two-thirds of the Republican voters believe the election results are fraudulent !!!. Even though no Court of law has backed this lie, the President has been saying so for 4 months and those millions believe him even though he is lying. How can President Biden reconcile such a split America? National reconciliation cannot be achieved without acknowledging empirical facts and accepting the truth. One should recall that in mathematics there is no equilibrium without a fixed point. In the context of this discussion, the loser of the elections should have accepted the results and conceded to the will of the electorate. These norms are critical for the resiliency of Democratic institutions. President Trump not only lied but has also not conceded his defeat, a prerequisite for the peaceful transfer of poswer.

The public expects their presidents to set an exemplary model behavior. President Trump has shown no such modality. According to the Washington Post, Mr. Trump has by January 20, 2021 lied and made misleading statements 32,000 times ( G. Kessler, Daniel Dale)[19]. He never released his taxes, and never distanced his business interests from his personal guise while in office. He used the Department of Justice to pursue his legal defense and to chase his opponents. We now know (all media) that in his last week in office, he tried to fire the acting Attorney General for not taking election results to the US Supreme Court to throw them out.

In the last days of his Presidency, he pardoned convicted criminals who worked for him in order to protect himself from what they knew. In the second batch announced the day he left office, he pardoned contributors who in effect purchased their pardon and deplorable crooks sentenced for long years for financial frauds. In both cases, he did not ask the DOJ to scrutinize the pardoned as has been the norm, Again, he proved that what matters to Donald Trump will always be what serves his own interest. (Morning Joe)[20].

The US constitution fashioned a system of government based on Madisonian checks and balances and on an honor system in respect of upholding Democratic institutions. Has the abandonment of these checks by President Trump`s refusal of Congressional subpoenas, has his refusal to cooperate with the legislator placed Congressional oversight in permanent jeopardy?

All of that poses painful questions about the fragility of democracy and the brittleness of its institutions. In the 20^th century, Hitler in Germany, Mussolini in Italy, Juan Peron in Argentina, Ruhullah Khomeini in Iran and a host of authoritarians in Latin America, Africa and the Middle East subverted Democracy from inside. In our days, Urban in Hungary, the ruling coalition in Poland, Modi in India, Sisi in Egypt and Erdogan in Turkey, have done the same. Will American Democracy succumb to such subversion after Trump?
*********************

This paper did not dwell upon the Foreign Relation challenges facing the Biden administration. Biden had made the correct pronouncements and picked the right personnel to do a massive resetting of Trump`s policies. Only a full separate paper can do justice to the numerous issues involved.

Geneva, 21/1/2021

NOTES

[1]. The vote was 232 for. Ten Republicans voted for impeachment .Liz Cheney the third ranking leadership members led this bipartisan vote

[2] . See michael Sakbani,1”, The 2020 Elections; What Did the Two Parties Do”, in michaelsakbani.blogspot.com, December, 2020.

[3] In Pennsylvania, the Republican legislator changed the acceptance limits of receiving mail vote. But the state Supreme Court reversed that. Justice Alioto allowed the plaintiffs to come back to the Court. In the event, the US Supreme Court dismissed the case.

[4] . Adam Liptak,” In Blistering Retort 4 Battleground -States ToTexas:.Butt out of Elections”, The New York Times, 10/12/2020

[5] . AP, Washington Post, and other media, recording of Trump`s telephone to the S. Secretary of Georgia the Honorable Brad Raffensperger, December, 3 / 2020

[6] . Statements by Ted Cruz and Josh Hawley on the Senate floor, January 6, 2021

[7]. Transcript of Trump's Speech at Rally Before US Capitol Riot, in, Associated Press, Wire Service Content Jan. 13, 2021, at 9:11 p.m.

[8] . John Avlon, CNN, January 17, 2021.

[9] . Michael Sakbani, 2, “A Revisit of the Impact of the Pandemic on the Economic and Political Scene” in. michaelsakbani.blogspot.com, May 2020.

[10]. An example is Ashley Pavette, an Iraq`s US veteran who had a small business in need of financing. She borrowed at a loan-shark interest of 160 % per annum. She was killed in the January 6 riots..

[11 Jeff Zieten, on Today, CNN, January 21, 2021

[12] CDS, Weekly Briefing, January 17, 2021.

[13] . The suggestion is to give every state the present allotment of votes but add one vote per five million inhabitants starting with the second five million. For example, New York would be given under the present census of 19 million, 2 more votes.. Any other number can be considered

[14]. Michael Sakbani,3, “Trump the President That Was Not to Be; Analysis of the Likely Economics, Political and Foreign policy Consequences”, in michaelsakbani.blogspot.com, November 2016.

[15] . Interest rates at this juncture are less than 1 % on long-term bonds..With such a cost of capital, the net rate of return on the projects is likely to be much higher than that. The government would put in a starting seed capital, while private investment would provide the bulk of the venture capital. Naturally, once the project is up and running the Government can liquidate its seed capital.

[16] . Immigration reform should be bi-partisan. Many Republicans expressed the view that merit, need and expenses such as Medicare should be among the choice criteria

[17] David Chalian, CNN ;19 January 2021.. See also Morning Joe, MSNBC, January 19, 2021.

[18]. Michael Smerconish, CNN, 13/1/2021., interview with professor Lawrence Tribe

[19]Glen Kessler, Daniel Dell, The Washington Post, December 10, 2020.

[20] . Morning Joe, MSNBC, january 18/2021.

the Blog Papers of Dr. Michael Sakbani; Economics, Finance and Politics

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Thursday, January 21, 2021

Post - Trump America: A Clarion Call For Reconstruction

The blog papers of dr. Michael Sakbani: economics, finance and politics