The System Is Not Supposed to Work

NY Times 12-19-15On December 19, 2015 The New York Times ran an opinion piece by Kevin Baker entitled Political Party Meltdown, which put perspective and a smidgen of clarity to the opaque and toxic swamp that is our Congress. I urge you to read his insightful essay now. Then have a look at the exchange between my friend Dan Wallace and Kevin Baker. Whatever comes up for you in reviewing the words of these smart and informed guys, put them in the Comments section below. Help us all to learn even more. And perhaps the frustration we feel over our dysfunctional and often non-functional government just might abate just a bit.


Dan Wallace wrote:

Kevin – I loved your essay in the NYT, and I had a thought/question on which I’d love your opinion.

I worked for a moderate Republican senator in the early 80’s (about when I think the shift from 4 “parties” to 2 really started – the Reaganites were very intolerant of anyone to their left). I left Capitol Hill believing that the Founders had intentionally designed the institutions of the Federal government, and especially Congress, to require lots of horse trading because that would ensure that resources were apportioned reasonably fairly over time. It seems to me that it worked beautifully as long as resources were growing, which is all the Founders could have imagined they would do, but that it stopped working around 1975, which is the last year the US ran a trade surplus and therefore, I would argue, marks the point at which the US actually became intrinsically non-competitive in the global economy. Our political institutions simply have no capacity to take things away from people, which is really what they’ve needed to do for 40 years, and so they have behaved in a very distorted fashion. The main form of distortion has been to paper over our lack of competitiveness with massive deficit spending. “Conservatives” (and remember, my instincts are those of a moderate Republican, not a liberal Democrat) don’t like to remember this, but the deficit spending was kicked off in earnest by Reagan. We were running deficits of $50-60 billion/year until the tax cuts passed, at which point they jumped to about $350 billion/year, which is pretty much where they’ve stayed ever since, except for ’98-99 surpluses, and 2008-present, when they’ve been closer to $1 trillion/year. And the latter, I think, can be seen as simply one piece of reckoning for the can having been kicked down the road by institutions (not just people) who intrinsically don’t have the capability to do anything else.

The discourse certainly was much more civil in 1983 than it is now, but my experience tells me that Congress was no better at actually solving a difficult problem then than it is now. It just failed at lower volume.

That’s my 30,000-foot view of how this has played out. I would be REALLY interested to know where you agree and disagree.

Warm regards,

Dan Wallace


Kevin Baker’s reply:

Dear Dan,

Thanks for reading—and writing.  You make some interesting points. Just some quick reactions to them:

—While I’m hardly an expert on them, I’m not sure that the Founders, for all their virtues, really did foresee a lot of constructive horse trading.  They never seemed that at home with a party system; I sometimes [think] they envisioned high-minded debates in which the overwhelming logic and beauty of their arguments swept all away.  When that situation failed to materialize, they turned immediately to scandal sheets and pistols.

—I don’t think I’d agree that our institutions are incapable of taking things away from people.  I think Americans have a generally good record of sacrifice in times of war, and I would say that decades of generally stagnant incomes mean that many people have had a lot taken away from them. For that matter, the minimum wage still is not the equivalent of what it was in 1968, and didn’t the famous Reagan-O’Neill deal on “entitlements” entail a payroll tax increase on the vast majority of Americans?

—Did the trade deficit really mean we were inherently unable—or less able—to compete in the world economy?

I would question that.  I think the increased competition with the likes of Japan and Western Europe then was generally a good thing, which forced our companies and workers to get better.

But competing with a host of other nations, all over the world, that employed such tactics as using child labor, outlawing unions, banning civil liberties, and erecting tariff barriers?  I think that was, and is, crazy—and also, as I’m sure you know, very much an anomaly in our history.

William McKinley, for instance, would never have contemplated the idea that Americans should have competed against, say, labor from Italy in his time, much less from China.  But now, for some reason, both parties generally embrace it.

—Beyond that, I’d say our economy, and our society, both have deeper structural problems.  My thoughts on this are far from original, but in general I would say that these include doing much too little to support wages for the 70 percent of the population who still do not get a bachelor’s degree; shifting more and more of the tax burden onto the working and middle classes; and so structuring tax codes and financial regulations [such] that, more and more, the best minds of our nation are lured into the mere manipulation of money.

I don’t think most people aren’t sacrificing enough.  Instead, they are in overdrive:  scrambling to work 2-3 jobs, working desperately to send their kids to private schools and universities that charge ungodly amounts of money, and at the same time trying to take care of aged parents who now live longer than ever, with less and less capacity.

It’s a big reason why, I think, the establishment narrative from both parties—work hard, obey the rules, get an education, and you’ll be fine—seems increasingly absurd to them.

Anyway, nice corresponding with you.  Just out of curiosity, which Republican did you work for?  Many in my family were Rockefeller Republicans, and I’ve always had a certain admiration for old Rocky.

All the best,
Kevin Baker


Ed. note: There is much in America that needs fixing and we are on a path to continually fail to make things better. It is my goal to make a difference – perhaps to be a catalyst for things to get better. That is the reason for these posts. To accomplish the goal requires reaching many thousands of people and a robust dialogue.

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3 Responses to The System Is Not Supposed to Work
  1. Don Zwiers Reply

    Balance a budget:
    The American Taxpayers have big problems: consumers are paying all the taxes and governments and businesses don’t pay their share. It’s not fair. How about each government balancing their own budget?

    Replace a 70,000 page tax law which few understand with one simple paragraph that everyone will pay without a wink: “THE ONLY SOURCE OF REVENUE EACH GOVERNMENT HAS IS AN ADJUSTABLE CONSUMPTION SALES TAX ON ALL PRODUCTS AND SERVICES, CREATED FOR PROFIT.” Eliminate entitlement programs that take away people’s self esteem and thousands of Special District Governments, leaving Federal, state, county and local governments as the only “Not for Profit” businesses. Everyone works and pays their fair share. As businesses consume products and services they pay the same taxes as everyone else. The constitution says Taxes shall be uniform throughout the United States.

    Voters are in charge. Local governments issue business licenses with regulations to collect taxes, pay workers their minimum wage, use local banks to deposit all revenue before spending, issue a receipt for each sale and follow their state’s environmental laws. Banks will forward all taxes, unless someone has a problem concerning higher governments not providing benefits fairly. The City Council can hold back their share of taxes until the issue is resolved. Money talks!

    People that can’t find a job will move where there is work. Schools are run by private citizens and higher governments provide the buildings and equipment from their taxes. Governments will never do the work the Free Market does; instead, contract it out and pay taxes.

    Taxes are cut in half, budgets are balanced, Free Market is stronger and a smaller government is doing a better job. Our differences are being utilized while our Guaranteed Freedoms are now shared equally. WHY NOT?

  2. dominick Reply

    Our founding fathers, mostly wealthy slaveholders, wrote the Constitution in the 18th century. Much like our wealthy members of Congress today, they were concerned about paying taxes. Now we have millionaires in Congress and other legislatures concerned about making laws for themselves to preserve and increase their personal wealth in this 21st century. It’s just human nature, I suppose.

    Unfortunately, many of our representatives today are sociopaths and lie continuously to hold positions of power to control taxation. While our US Constitution grants them immunity from civil and criminal prosecution from citizens for the harmful decisions that they make, they are providing an increasing number of their campaign donors these same privileges in many of our industries. For example, oil companies regularly pollute our environment and financial institutions regularly commit fraud. Yet, there are few consequences for their criminal behavior, except for having their shareholders pay fines, which are tax deductible and considered as just the cost of doing business today.

    If we want to create real change in our political system, we had better start demanding that our representatives listen and respond to us, instead of their wealthy donors and special interest lobbyists. Voting in elections for candidates who tell you what they think you want to hear, is an increasing useless activity, if they refuse to listen to you once in office. Bernie Sanders appears to be the closest in representing American opinions, and many other politicians appear to listen to their constituents. However, no politician in the country has a web site with a forum dedicated to his or her constituents and a polling program to involve their constituents in their decisions. Not one.

    If we want to have a true democracy, the constituents of our executive and legislative office holders must directly involve themselves in their decisions. It’s time to put an end to letting them talk with each other and their lobbyists to make laws we must obey, while we stand by hoping for the best. The process of having citizens involved in the decisions of their representatives can start today, with both incumbents and those seeking their offices. If you think you are supporting a politician who claims to represent your interests, just do what I suggest on my web site and you may discover they have been honest with you. On the other hand, you may also discover that the person you support has no interest in your opinion, just your vote.

    Just send or hand them a copy of our pledge, asking them what they think about it. If you never hear from them again, you’ll have a clear answer to the question: Does he or doesn’t he, or she – want you to play a part in the decisions they make for you. If Bernie would be first to sign our pledge, it would be impossible for him not to be our next President.

  3. Jim Altschuler Reply

    I appreciate both Mr. Wallace’s and Mr. Baker’s points. Another question, though, is at what point in time did the Congress quit caring about what was best for America and for Americans?

    When did they lose sight of what they were supposed to be doing in their jobs?

    And when did the American people give up on their responsibility to ensure that their elected “representatives” do the jobs for which they were elected?

    It seems that it’s not enough that the people in Congress don’t want to do what they are supposed to do, that they are too busy protecting their own asses and their party’s line and defeating anything that the other party thinks is the right thing to do (pure obstructionism), even worse . . .

    The American people have become totally apathetic to the whole process, yet they complain bitterly, albeit quietly, about their lot.

    Does anyone else see anything wrong with these situations?