Election in Argentina boosted investor confidence, but is it sustainable?

My interview with Deutsche Welle on the Argentine election and the economy. I also had the opportunity of talking with Newsweek on Trump's strategy for Latin America.

Post Keynesian economics and academic freedom

Tom Palley wrote a short post on his recent experience with the Post Keynesian Economics Society (PKES). The post raises interesting issues about what constitutes an economic topic and where to draw the line between academic and non-academic work. A similar debate recently occurred on the listserv of the Union for Radical Political Economy (URPE) regarding an announcement about the Gaza conflict (specifically, whether it constituted genocide, whether URPE should have a statement on the topic, and so on).

On the two main topics of Tom's piece -- what constitutes an economic related topic, and what is an academic subject -- I should say that I tend to think that there are relatively clear answers (and my views might not be hegemonic, in this field; see what I did there?). I come from a political economy tradition, that harks back to classical political economy, according to which economics is about the material conditions for the reproduction of society, in which social classes, and the conflict between them are central not only for the determination of distribution, but also of the pace of accumulation and progress (another question open to debate).* Hence, issues related to Ukraine and Palestine, and other geopolitical issues are certainly part of political economy, and it is hard to suggest that they should be excluded from conversation.

On the other, whether something can be consider academic or not, at least from a sociological point of view, is entirely determined by peer review, what economists doing academic work in economics define as academic work. In this case, what Post Keynesians (PKs) considered PK economics to be. From that point of view, and regarding PKs, it seems clear that the issues of the war in Ukraine, that Tom was discussing (whatever the views on that were), would have always been seen as part of the tradition, and a perfectly reasonable topic of inquiry. Just to provide an example, in the second issue of the Journal of Post Keynesian Economics (the journal that gave the name to the tradition), Charles Issawi had a long discussion of the Arab-Israeli conflicts to understand the 1973 oil shock (there are other papers in that issue on similar topics).

Mainstream economics always took a dim view of PKs willingness to entertain issues that were hard to formalize. Robert Solow famously said that:

"The proper way to do macroeconomics can hardly be all historical context and no analytical structure. Unfortunately the school has provided no systematic description or example of what it conceives to be the right way to do macroeconomic theory. Thus far so-called post-Keynesianism seems to be more a state of mind than a theory." 

Note that, while critical of PKs, Solow was not for the exclusion of PKs from conversation, and he was always willing to discuss with heterodox economists (on this see my short piece on his relation to ROKE on the occasion of his death).

In other words, the post by Tom was on economics on a topic that PKs considered economics, at least ib the past.** For those reasons, it seems hard to justify the PKES decision, which appears punitive and an attempt to stifle conversation, the sort of thing they persistently criticize about the mainstream. This is much worse given the current attack on academic freedom, particularly in the US, with Trump going after academia in general.

* For my views on heterodoxy, and its relation to that tradition see this old post, and this paper. On Post Keynesian economics see this old piece.

** Colin Danby reminded me of the old PK listserv that used to be more than announcement emails, and was effectively a forum for the discussion of ideas. 

A Bipartisan Neoliberal Offensive

By David Fields

Donald Trump’s fascist political ascent is not a mere historical anomaly or an unpredictable deviation from the norm. On the contrary, it represents a predictable and deeply entrenched political outcome, that is, the logical, albeit unsettling, culmination of a long-standing bipartisan reorganization of the United States political economy. This restructuring can be understood as a coherent and potent neoliberal project, meticulously designed to reorder American capitalism around the central tenets of maximizing corporate power and diminishing the role of the state in social welfare.

In pursuit of these objectives, this neoliberal project systematically dismantled the post-World War II social contract, characterized by relatively strong labor unions, progressive taxation, and the expansion of moderate social safety nets. It aimed to balance capitalist accumulation with, to a certain extent, social equity and economic security for the working class. Over time this foundational agreement was incrementally eroded. Policies favoring deregulation, privatization, free trade agreements, and supply-side economics dogma became paramount, leading to a significant redistribution of wealth upwards for the few and stagnant wages for the many. This long-term trend of prioritizing corporate interests over collective well-being created fertile ground for populist discontent and the rise of figures who, like Trump, could tap into widespread frustration with the established political and economic order.

Read rest here. 

 

The Mueller Report

Perhaps worth reposting what I said about Russiagate, now that the Mueller Report led to no additional indictments and validated the No Collusion slogan we're going to hear for the next year and a half.

Just a brief note on the whole firing of Comey scandal that is still unfolding, and the incredible degree of anxiety on the left, which somehow thinks this means that there is a 'pee' tape and that Trump will be eventually impeached (here, for example; too many of these). This is at least the second event compared to Nixon's firing of the Attorney General, the infamous Saturday night massacre. The other being the firing the Acting Attorney General Sally Yates.

All of these is very unproductive and dangerous for progressives in my view. It emphasizes an interpretation of the election that is deeply flawed. That Hilary was a strong candidate, that she was progressive, that she would have won (yeah, I know she did win the popular vote; but that's not the way it works) if Comey didn't discuss the emails days before the election, or the Russians didn't hack her campaign, or if Wikileaks didn't expose them.

It exempts the Dems from being just the other pro-business, slightly less crazy, but pro-business nonetheless, pro-free-trade, pro-Wall-Street party. It reinforces the already strong Neoliberal wing of the Party, that with the help of Obama and the Clintons (all making huge amounts of money in the speaking circuit) elected Perez for the DNC, and might end up with another candidate that will loose the election in the Rust Belt (here and here for my views on the election).

The real danger is eight years of this madness (and my guess, that's much more probable than an impeachment right now), unless progressives within the Democratic Party take over. So sure, investigate, resist, but please, pretty please, let's stop with this notion that all was the result of Russia, and that the Neoliberal wing of the Democratic Party is blameless.

Original post here, from 2 years ago.

Why Manufacturing Still Matters

I've been reading in the spare time (not as much as I would like, and worse with the World Cup) Louis Uchitelle's Making It: Why Manufacturing Still Matters. I tend to agree with the general idea of the book and with many of the policy conclusions, even though I have some problems with minor points (for another post). As a result of this I went to check manufacturing output. There are many different statistics to check in the FRED database. Below a measure of industrial output.

And yes, it is below the peak from the previous recession. We were talking about this with Tom Palley, and it is clear to me that this statistics played an important role in the rise of left (Bernie) and right-wing (Trump) populism in the US. The failure of the Obama recovery to lift manufacturing, not just jobs, but output too is central to any political economy story about the last election.

Racism, the election and more

After writing on Venezuela last week, Trump suggested that the US might intervene there. And then the predictable happened, violence and death ensued... in the US. I don't have much to say about what happened in Charlottesville. It is worth noting that even though the city and the University of Virginia are relatively progressive places these days, they do have a long history that ties them to slavery and white supremacy (see this on NPR; h/t URPE blog).*

At any rate, it's not surprise that Trump didn't condemn his base (and yes the racist voted for him; but as I noticed before 1964 those votes went mostly to Democrats). He certainly is more explicit than previous Republicans going beyond racist dog whistle  politics. I would insist that racism is not the main reason why he won the election, and that a left wing populist right have won.

The topic is still relevant (even in the middle of the violence and crazy confrontation with North Korea; btw, this is a must read for those interested on the history of US-Korea relations), since the lessons of the defeat are important to preclude 8 years of this madness. So this piece in the NYTimes shows that Obama-Trump voters, meaning voted for Obama in 2012 and for Trump in 2016, are real.

As the authors says, echoing what I said here a while ago:

... the national vote doesn’t count, and Mrs. Clinton is not the president. She lost primarily because of the narrow but deep swing among white working-class voters who were overrepresented in decisive battleground states.

The interesting twist is that racism did play a role in the flip from Obama to Trump, at least more than I thought it did by looking at the Rust Belt alone. The piece says:

... racial resentment is the strongest predictor of the Obama-Trump vote in this survey data. White, working-class Obama voters with racially conservative views were very likely to flip to the Republicans.

Note that not all the 'rednecks' in the Rust Belt are racists though. There is an interesting piece on the redneck revolt here.

* It's also the home of the Virginia School, or the Public Choice School of Buchanan (briefly discussed here), that has been the subject of a new book that generated some controversy in economics circles. I'll have more to say about the book later, once I'm done reading it.

Slow Posting, Hyperventilation, and the Wrong Lesson for the Left

Still grading, so slow posting for a while. Just a brief note on the whole firing of Comey scandal that is still unfolding, and the incredible degree of anxiety on the left, which somehow thinks this means that there is a 'pee' tape and that Trump will be eventually impeached (here, for example; too many of these). This is at least the second event compared to Nixon's firing of the Attorney General, the infamous Saturday night massacre. The other being the firing the Acting Attorney General Sally Yates.

All of these is very unproductive and dangerous for progressives in my view. It emphasizes an interpretation of the election that is deeply flawed. That Hilary was a strong candidate, that she was progressive, that she would have won (yeah, I know she did win the popular vote; but that's not the way it works) if Comey didn't discuss the emails days before the election, or the Russians didn't hack her campaign, or if Wikileaks didn't expose them.

It exempts the Dems from being just the other pro-business, slightly less crazy, but pro-business nonetheless, pro-free-trade, pro-Wall-Street party. It reinforces the already strong Neoliberal wing of the Party, that with the help of Obama and the Clintons (all making huge amounts of money in the speaking circuit) elected Perez for the DNC, and might end up with another candidate that will loose the election in the Rust Belt (here and here for my views on the election).

The real danger is eight years of this madness (and my guess, that's much more probable than an impeachment right now), unless progressives within the Democratic Party take over. So sure, investigate, resist, but please, pretty please, let's stop with this notion that all was the result of Russia, and that the Neoliberal wing of the Democratic Party is blameless.

Robert Wade on Trumponomics vs. Free Trade

Echoing some of the arguments discussed here in the blog (for a list of posts on free trade go here, and for the effect of free trade on the Trump election here, here and here) Robert Wade suggests that the economics profession defense of "Free Trade" might have something to do with the election of Trump.

Wade's phrase is perfect (apparently Adrian Wood came up with it): "Like Gresham’s Law, 'alternative facts' drive out facts." The alternative fact here is the theory of comparative advantage and the notion that free trade is the best of all possible policies for all countries (and people within the country) at all times. As Keynes, quoted in Wade's epigraph, said:

Free trade assumes that if you throw men out of work in one direction you re-employ them in another. As soon as that link is broken the whole of the free-trade argument breaks down (J. M. Keynes, evidence to the Macmillan Committee on Finance and Industry, 1930)

Read paper here.

Electoral quakes and the establishment: A new world approaching?

By Denis Melnik and Andrés Lazzarini (Guest bloggers)

As the first days of Donald Trump’s presidency unfold, the prevalent attitude to his surprising victory among the various breed of the liberal intelligentsia all over the globe is pretty much the same as it was on the morning of November 9, 2016 — that of a profound shock. Apart of purely emotional reactions (ranging from desperate ‘Bernie could have won’ to hopeful ‘Trump will be impeached almost immediately’), this shock reveals itself in attempts to rationalize what those intellectuals regard as ‘irrational’ in familiar and comforting terms. The terms were provided by what had started as a pre-election narrative postulating why a ‘bigot’, ‘misogynist’, ‘white supremacist’, ‘fascist’, etc. simply could not have won the election, and was supposed to culminate in authoritative post-election covers of Madam President’s victory. That narrative was happily going hand-in-hand with the data provided by political scientists. The latter had all the tools available from their powerful analytical arsenal to prove the imminent failure of Trump; on the election night it happened so that they had to reposition themselves, and to explain the failure of the data ‘on air’. The narrative itself did not remain orphan even for a moment though: it was adopted to explain ‘Madam President’s’ loss. Its psychoanalytical potential is undermined, however, by the need to interpret how the win of the person with such disparaging characteristics was possible at all.

Even if the models of modern political science at times can be somewhat loose, it is the reliable source of plausible and comforting (for some) post-factum interpretations appropriate for becoming the commonplace (post-) truths. The interpretation of the 2016 election focused attention on the three Rust Belt ‘swing states’ accounting for roughly 70,000 majority of popular vote. Precisely these votes, according to the established narrative, actually delivered Trump to the presidency (see, however, a more nuanced analysis here).

A day before the election, the visionary U.S. Vice-President Biden had called on some understanding, even empathy, towards Trump’s supporters: ‘We’ve got to figure out […] what is eating at them.’ Shortly thereafter, ‘they’ were located among the Rust-Belt 70,000. It were those (presumably) male voters that became the locus of therapeutic exercises for the liberal intelligentsia. The number is comfortably meager as compared with over 2.8 mln. Hillary Clinton’s lead in the nationwide popular vote; the anomaly is confined to an inward region of cultural and economic backwardness as confronted with the progressive coastal and metropolitan areas (which allow for a liberal use of habitual ‘postmodern’ pattern of explanation dealing largely with ‘cultures’, ‘identities’, ‘gender’, and the like); the angst over the anomaly can be safely channeled into external causes (the very backwardness of ‘theirs’, the electoral college system, alleged Russian hacking, etc.)

Still, the location of the anomaly did not preclude the search for ‘what is eating at them’. There emerged two major modes of explanation: a ‘psychological’ one (the frustration of undereducated, poor white male voters lost in the changing cultural landscape), and an ‘economic’ one (the discontent of the undereducated, poor white working-class voters hit hard by deindustrialization). The two modes are not incompatible: after all, according to mass-media outlets, ‘working class’ usually stands for men (for some mysterious reasons the mass-media do not regard women working either at their homes or outside as ‘working-class’). But while the first perfectly fits into the ‘post-modern’ pattern, the second is rather heterogeneous as it revives the elements of the ‘obsolete’ reality from a mass-production era. Indeed, with the advent of the notion of post-industrial society, first among sociologists since the 1970s, but later among economists as well, the idea that large scale industrial production was dying had become common wisdom by the 1990s. By the very same period, in the wake of the Soviet disruption and the fall of the Berlin wall, it had been merged with the notion of globalization; and both notions contributed to acceptance and spread of the neoliberal consensus both in the academia and in the progressive public discourse. These notions reshaped the understanding of the future trends. If in the 1970s–80s the evidence of deterioration of formerly thriving industrial and urban areas were generally considered as the signs of a general economic and social decline, since the 1990s the depressed areas around the former centers of industrial production were seen as a by-product of progress: some unpleasant (and temporary) evidence of a coming global, digitalized and anonymized order. The story of the ‘lost’ regions and industries was told in terms of a statistical tendency: that of constantly declining share of manufacture in GDP, and of manufacturing workers in the labor force. The practice of outsourcing, the urge to sign of free-trade agreements (during the Clinton era in the 1990s as well as during Obama’s terms) and the creation of the ‘global value chains’, sanctified in the authoritative sources on management, only reinforced the discourse further — one simply cannot be progressive if not to side with the actual way of progress. For some other mysterious reasons we are all told time and again that this alleged path towards progress and enhancement is the product of some natural force in the era of ‘post-industrial’ production in which each individual should release her creativity that will pay off sooner or later according to their merits – and not to their patrimony - of each individual. After all, the story goes, all of us have merits (human assets, human capital) – it is up to each of us to release them in full.

In the new millennium means of production lost its significance to production of meaning. The working class was substituted by the ‘creative class.’ And the creative class of the world was effectively united by Facebook and other social networks of choice. Its major champions were creative indeed: they created the brand new industry of urbanism promoting their enlightened, valuable (and high-priced) expertise on gentrification and the other means of ‘post-modernization’ of the cities in decay. But it was a win-win game. The virtual reality allowed for a fair share of ‘likes’ for all, and the senses created by a new global value chain of symbolical production did produce the sense of participation among the aspirant cadres from the peripheral belts of the ‘global village’ (or, rather, ‘Greenwich Village’). A real world was conveniently represented by the newsfeed on a screen of an iPhone (preferably in a Starbucks); only the Hope was needed, and it was delivered in abundance. Alas, the Great Recession endangered the consumption of lattes and smoothies among the ‘creative class’, and proved that the discontent of the ‘working class’ in some cases cannot be relieved by urbanism alone, nor by any of the other virtual prosperous villages.

‘What’s eating at them?’ had been long in the air before November 9, 2016. But it seems that the ‘economic’ mode of approaching the question would have remained confined to a restricted circle of old-fashioned radicals, only rarely and condescendingly noticed by the progressive left, unless for the series of political quakes. It was again the political science that breached the established ‘post-modern’ pattern. By the time of the 2016 U.S. election the talks on the crisis of globalization and the major blow to the neoliberal consensus due to economic troubles of the ‘old’ sectors of the advanced economies had ceased to be regarded as eccentric. Initially the rise of ‘populist’ movements with their pleas for protectionism and nationalism was conceived as a political aftershock to the world economic crisis (and, more recently, to the wave of immigration); the aftershock that might have delivered a number of parliamentary seats to the newcomers, but not to shake the established bipolar (centre-left – centre-right) political order in the advanced economies (the electoral successes of populist and nationalist parties in Hungary and Poland were largely regarded as the excesses of young democracies to be corrected by the influence of the EU apparatus). It was the start of the anti-establishment U.S. primaries in 2015, Jeremy Corbyn’s unexpected rise, the Brexit vote in June 2016, which let into the mainstream discourse the idea that economic discontent can be translated into real political changes. Shocking as it was for the whole class of public opinion makers, Trump’s win was a verification of the hypothesis that had already emerged out of the previous experience. And afterwards, all other electoral events in the advanced economies have started to be seen under the light of this hypothesis: as its further verification. It was the case of the prolonged and inconclusive presidential elections in Austria (where the right-wing candidate at last failed); even more so it was the case of constitutional referendum in Italy on December 4, 2016. In the latter case, Matteo Renzi, then Prime Minister, a whiz-kid to Nicolò Machiavelli and Nelson Mandela (most likely with Mother Theresa as a midwife), a self-proclaimed communication guru (he uses his iPhone as masterly as Macbook), and a self-esteemed Latin Obama, managed to transform otherwise rather secondary electoral event into the reality show — to receive finally the international fame he fully deserved. The next test is the coming presidential election in France, where a bunch of gifted centre-left and centre-right political leaders did their best to support the cause of Le Pen family.

But here we are leaving the electoral analysis for the realm of political science models (assuming they are much more advanced now, than prior to November 2016), in order to concentrate on the hypothesis itself — the hypothesis, let us recall, that underlies an ‘economic’ understanding of the series of electoral quakes. ‘Trumpquake’ was strong enough to make the mainstream political discourse to embrace the notion of revolution (see here and here). Putting this ‘political revolution’ on economic grounds of deindustrialization and other negative effects of globalization, combined with the impact of the economic recession and slowdown on incomes and opportunities only made the notion more plausible. Again, there is nothing at odds with the idea that Trump’s victory was based on economic discontent of certain social groups, which would prevent using it as an element in therapeutic exercises of the liberal intelligentsia, that is in development of Freudian-like narratives. Generally, in such exercises it is just a background for narrating, and not the narrative itself: there is nothing in economic issues to make them even nearly as exciting as the search for a ‘father figure.’ True, the vast majority of the low-income recipients voted against Trump, while high-income classes opted for the billionaire only on a slight edge difference against Clinton. The huge absentee for election-day, which would otherwise have had other effects, can be interpreted as the big failure of the Dems to actually deal with the economic consequences of free-trade liberalization on the once-booming manufacturing workers.

Still, economic understanding of recent political history has its own logic, which is in its essence alien to the mainstream approach, centered on subjective psychological phenomena and their social objectification in forms of ‘identities’, ‘cultures’, ‘minorities’, all echoed by many mass-media outlets. Only one step from here is needed to postulate that the objective ‘economic forces’, rather than a variety of subjective representations and projections, is in fact the driver of historical processes; and that political and social effects of ‘economic forces’ may well differ from the desires and expectations for the future shared by respectable, present-day opinion-makers.

Such an understanding very much resembles a certain old-fashioned doctrine, originated in the works of an obscure and pretty ‘modernist’ 19th-century author. The notion of revolution as the ultimate means to ensure the compatibility between economy and society was central to that doctrine either — even if the proponents of that doctrine usually saw the revolution as an outcome of long conscious activity, rather than an unexpected break of the political prediction models. Even here, however, history is able to make a sarcastic grin: Steve Bannon, who urged the Trump team to concentrate efforts on white ‘working-class’ electorate of the states previously considered to be Democratic firewall, once allegedly proclaimed himself a ‘Leninist.’

It would have been really remarkable if the ‘post-modernist’ discourse were to embrace, even occasionally, a ‘modernist’ doctrine of historical process. It was not the case, however. A political revolution it was not — there were no change in any basic institution of the advanced economies.

There is a shift in political reality underway, but it was not an abrupt change in social and economic reality. True, Trump’s victory may dreadfully frighten those who eight years ago deemed Obama’s term as a hopeful and democratic paradise. But the fact is that the capitalist system is restructuring itself, back again to boost the domestic production (of the advanced economies) before any truly anti-capitalist threat may take roots. This political shift in the political reality on the globe does not in the least mean a break with neoliberalism and globalization – while we may await for increasing public expenditure on military and infrastructure, much alike to what Reagan did in the eighties, there is no reason to expect a tyranny now, which may break ties with the other economies of the world. There are no revolutions, but electoral quakes within the established circle of mass establishment options staging on the democratic playground of the global village. It is not the notorious ‘glass ceiling’ that is to be shattered, rather the mirror between the established class of the opinion-makers and reality of the modern world.

Can Trumponomics work?

Work for whom?

That's what Martin Sandbu (subscription required) asks in the Financial Times. In his view, it might. He cites Ken Rogoff -- of spreadsheet fame -- who also has said that it's a possibility. Sandbu cites Summers doubts on Trumponomics, which are all based on supply side factors, but has very little to say about that.* Like Rogoff, Sandbu thinks that what matters is private investment that matters, meaning demand, and, as it must be in these cases, the confidence fairy makes an appearance. In his words:

"What matters, of course, is whether business investment will increase under a Trump economic policy. If it does, it could be because regulations are made business-friendly, because fiscal stimulus boosts aggregate demand and expectations of future demand growth, simply because there is something about Trump that changes the "animal spirits" of investors and business decision makers."

Keynes' animal spirits, also valued by New Keynesians, become relevant. However, the really relevant stuff in there is the fiscal stimulus and how much in terms of actual spending rather than tax cuts for the wealthy, and on what he will spend (e.g. infrastructure). On that, by the way, Trumponomics remains a mystery. But he is right that if: "if a greater fiscal deficit would have boosted growth under a president Hillary Clinton, it should also boost growth under a president Trump."
But the important point Sandbu makes is that:

"Whether greater spending leads to greater (sustained) growth depends on, as Rogoff rightly points out, whether there is much spare capacity in the economy today, or more intriguingly, whether supply capacity itself responds with faster productivity increases in a 'high-pressure economy' of strong demand."

Note that Rogoff only makes the point about spare capacity, and the intriguing idea that the supply constraint responds to demand is Sandbu's own. In other words, he argues that some sort of Kaldor-Verdoorn Law might be at work in the economy. And yes, that's absolutely right.

So can it work? Sure, but for whom is the important question you should ask. And it will be for the few? A boost to infrastructure spending would certainly help, and even military spending (and I'm not discussing the foreign policy implications of a Trump presidency), which is the way the US promotes industrial policy, might stimulate growth. But I would expect after his choices for the economic positions in the cabinet, including his last very anti-union Labor Secretary (and his twitter rant against the Carrier union leader) that the benefits will not be very well distributed.

* Rogoff thinks the economy is not growing less because of secular stagnation, as Summers, meaning it's not a permanent supply-side problem (negative natural rate of interest, or whatever version of the argument you prefer), but the result of debt overhang (more on this for a later post).

The New US President: Jobs, Wages, Health & Social Security: What's Next?

More from the Economists for Peace and Security conference. The macro panel, with Josh Bivens, Nancy Altman, Pavlina Tcherneva, and Stephanie Kelton.

EPS Symposium: Policy Challenges for the New US President: Jobs, Wages, Health & Social Security: What's Next? from Thea Harvey.

The working class joins the cocktail party

The working class elephant in the room

Upton Sinclair famously said that "it is difficult to get a man to understand something, when his salary depends on his not understanding it." Not understanding the results of this election is what the Democratic establishment is trying very hard to do. Many will continues to say that at the heart of the loss are the misogyny, racism and xenophobia of Trump and his supporters, which is real and problematic, but deny the truth that it was the neoliberal free trade policies pushed by the Clintons and Obama that kept people from going to the pools, in particular in the Rust Belt (see here, but also here, which says essentially the same).

Hillary had slightly more votes than Trump (and yes the electoral college doesn't help, but that's not the problem now), but she had less votes than Romney and about 8 million less votes than Obama in 2008 (when some people thought he was a progressive; btw, there was back then a thing called Economists for Edwards, since many progressives thought, correctly, that Obama was a centrist like the Clintons. He ended up receiving a lot of support because he was the anti-Clinton candidate).

As I noted the other day, the neoliberal wing of the Democratic Party is not dead. Now they are trying to get Howard Dean to substitute Donna Brazile (that passed debate questions during the primaries to Hillary), the interim head of the Democratic National Committee (DNC) (a position she holds because Debbie Wasserman Schultz was forced to resign after being caught blatantly helping Hillary's campaign during the primaries). Bernie wants Keith Ellison instead, since he correctly noted that: “the Democratic Party has to be focused on grass-roots America and not wealthy people attending cocktail parties.”

Of course you will hear a lot about how we need serious people to take over the party in these difficult times, and how we need to collaborate with President Trump, and not be obstructionist, and the idea of electability (how did that work with Hillary?) will be brought back in four years. The emblem of that were the comments from Daron Acemoglu that I quoted the other day: "as long as the Democratic Party shakes off its hard-core anti-market, pro-union stance, there is a huge constituency of well-educated, socially conscious Americans that will join in." That position cost Dems the election, but you should not be surprised that this is taken seriously. This is what the party's establishment is trying to do, since their jobs depend on them not understanding that the Dems need the working class, and they do prefer the nice and educated people in their cocktail parties anyway, rather than the uncouth, and in their view, racist, misogynistic, and xenophobic,* blue collar workers.

* Before some idiot suggest that I'm saying no Trump supporter is racist, misogynistic, and xenophobic, yes there are too many indeed, and his presidency will make things worse. But that's not the reason the election was lost, and many of his voters are NOT those things and DO have legitimate economic grievances. And yes, the majority of the working poor actually voted for her (not enough in the Rust Belt), as I noted in my previous post on the election.