Daily Archives: June 3, 2011
A year or so ago I wrote an post asking “Are we needlessly scaring ourselves to death”? My feeling was that we do indeed needlessly scare ourselves to death by not putting threats into perspective. Used in the post were statistics about terrorist attacks via airlines and the likelihood of actually being a victim of terrorism in such a situation. As you might imagine, given the number of passengers, flights and miles traveled, the risk per se is statistically miniscule. But that doesn’t keep the population at large from being “scared” of the threat or condoning limits on liberty to hopefully prevent even that tiny percent of successful attacks.
That brings me to a larger point. The evolution of “scaremongering”. Frank Furedi hits on the issue I’ve observed over the years since technology and the internet have given communication a rocket boost that we apparently haven’t quite adapted too. Scaremongering has become a competitive growth industry:
[T]he massive growth of fearmongering campaigns and crusades over the past quarter of a century has been unprecedented. Fear-fuelled grandstanding becomes most extravagant in relation to the very big catastrophic hazards that apparently threaten the survival of the planet itself. The list of potential planetary disasters is growing all the time. International terrorism, climate change, influenza-type pandemic, the AIDS epidemic, overpopulation, obesity, disastrous technological accidents – these are only some of the many mega-hazards that are said to confront humanity today.
Scaremongering also has a powerful impact in the arena of individual health. Health scares targeting women and children in particular have become a flourishing enterprise in recent years. Health scares are often linked to anxieties about food or the alleged side effects of drugs, pollution and new technologies. Personal security is another important area for fearmongering. Anxieties about crime, immigration and anti-social behaviour are regularly promoted by law-and-order groups. The environment, of course, is now treated as a potentially huge problem in it own right. Anything that has an impact on nature is said to store up big disasters for the future.
With so much to fear, it’s not surprising that there is now an intense level of competition to grab the attention of the public. Scaremongering has become a highly competitive enterprise; contemporary public debate often takes the form of countering one hysterical plea with another.
He’s right. And the result is a confused public and a debate that spirals out of control with little of substance being offered in the way of constructive dialog and argument. It is instead replaced by competing attempts to scare the public to one side or the other. We see it everyday in the so-called political debate. In many cases as debate about any issue is reduced to scaremongering. And while many of us may understand that, there are even more that don’t.
Complex issues are reduced to tag lines and sound bites. “Paul Ryan’s Medicare plan will kill old people”. Bumper-sticker scaremongering which opponents to such a plan consider successful if it goes viral and becomes the conventional wisdom. And those who throw things out like that know, for the most part, that the average American isn’t going to take the time or make the effort to research the plan and attempt to understand it. He who gets the first meme to go viral out there wins, even if it is blatant nonsense.
And the Democrats or left aren’t the only side which does that (although I’m of the opinion that it is something the left does more than the right based on my observations). Looking at many of the social con arguments on the right examples can be found that point to the fact that they’re not at all averse to a little scaremongering to advance their agendas.
The result, however, is ironic. In an era in which unprecedented information on just about any subject or issue are available to just about everyone, we find narratives and memes created by scaremongering to still be accepted at face value by majorities of people. And that sort of success – scaremongering – breeds imitation. If it works for side A, side B certainly isn’t going to eschew it.
Consequently, as Furedi points out, scaremongering has become highly a competitive enterprise of claim and counter-claim.
The problem, of course, is the fact that there are things we should be very concerned about, but we have difficulty breaking them out of the clutter of issues being fearmongered. We also have a tendency to dismiss legitimate claims out of hand, if they sound like fearmongering, because so many of the hyped up issues turn out to be so much nonsense.
Information and perspective are two very important tools in the war against scaremongering. In my estimation, the battle against the scaremongering alarmists of AGW is a case study in how such scaremongering should be countered.
But there are so many things these days, as Furedi points out, that are being given that treatment that it is not only exasperating but somewhat depressing. We can’t make rational decision based in irrational and over-hyped issues, but we do it all the time. Look at what Germany just did with its nuclear power based on the experience of a island nation hit by a tsunami. That’s likely to happen there, right? Pure fear expertly exploited.
Fearmongering is something which has to be guarded against and fought. One of the best ways to do so is obviously through offering facts and perspective instead of a counter claim based in fear. Unfortunately, for the most part, it seems the sides prefer fear to facts, and that does us all a huge disservice and can be potentially – and I say this advisedly so as not to be branded a “fearmonger” – catastrophic if the wrong policies are implemented as a result.
Ron Klain, former Chief of Staff for Joe Biden (and a Bloomberg View columnist) gives you a peek at the plan. Klain has a piece in Bloomberg where he puts the outline of what the administration needs to do to spin the car bailout properly if it hopes to make it a campaign positive. Klain’s suggestions are offered to form the basis of a narrative which will be polished and become a center-piece of the record of Barack Obama. The reason for beginning now is obviously an attempt to condition the public, which was very much against the bailout (and mostly remain so), to the supposed positive aspects of the takeover by government.
Of all the policy challenges I saw Obama tackle in my two years in the White House, none was more complex than turning around the U.S. auto industry. When the president took office, the industry was in free fall. Sales of cars and trucks, which had topped 17 million in 2006, fell to 10.6 million in 2009. Two of America’s three major automakers were insolvent, kept alive by weekly inflows of federal cash. U.S. automakers had an unsustainable cost structure, were badly trailing their foreign competitors in the production of fuel-efficient and electric vehicles, and seemed unable to make the hard choices needed to arrest their downward spiral.
The course the president chose was unexpected and risky. Most Americans remember that the administration decided to "bail out" the car companies — and indeed, the president did extend more loans and support to the industry. But he attached to the aid a series of controversial and painful conditions that ended business as usual in Detroit.
Call it “gutsy call II” if you will, but in reality, it is far from the picture that Klain ends up painting. Both the car companies were headed toward bankruptcy – a financial condition they had earned by their poor practices and sellouts to unions. Obama’s bailouts certainly ended “business as usual” for those two companies but not in a positive way.
One of the consistent memes is that had Obama not acted, GM and Chrysler would have gotten the equivalent of a death sentence by having to go into bankruptcy. By death sentence I mean the administration and its bailout supporters imply millions would have been thrown out of work and those two companies would have forever disappeared.
Uh, no. As Jim Manzi at NRO explains:
First, in the event of a bankruptcy, you don’t burn down the factories, erase all the source code on all the hard disks, make it illegal to use the brand name Chevrolet, and execute all of the employees. Others take ownership of the assets, and the employees go on with their lives. Some of these assets will be put to use generating revenues, profits, and taxes, and some of these former employees will get jobs or start businesses, and generate revenues, profits, and taxes. In order to measure the effect of the bailout over, say, five or ten years, you have to compare the actual taxes collected to what would happened over this same period in the counterfactual case where the bankruptcy was allowed to proceed. What owners would have bought the factories and IP assets, and what would they have done with them? What businesses would the former employees have started? Who would have moved to Arizona and retired? What new industry clusters will evolve in Arizona because of this transfer of people?
And what would have come out of the bankruptcy? Leaner companies better equipped to address the market and turn a profit. What wouldn’t have come out of the bankruptcy are the level of union pensions and benefits the administration preserved. Obama, through his bailout and modified bankruptcy made sure those were weren’t destroyed. Consequently you have pretty much the same conditions that existed prior to the bailout still in existence today with the added twist of more union control.
GM, for instance, just before it announced it had “paid off” its government loans, lost 3.4 billion dollars. Hans Bader, of the Competitive Enterprise Institute destroys the myth of GM’s loan payback with an extensive investigation into the real story. It is a story of known falsehoods being tacitly approved by the White House and the Treasury Department because the administration was desperate for some good news at the time. The Chrysler loan payback, as I noted recently, is of the same stripe. More smoke and mirrors from the “transparent” administration.
But back to the bailouts and the reasons. The defense offered for the bailout is this:
The White House report said the money invested in GM and Chrysler ultimately saved the government tens of billions of dollars in direct and indirect costs, including the cost of unemployment insurance and lost tax receipts that the government would have incurred had the big Detroit auto makers collapsed.
Again, that assumes nothing comes out of any bankruptcy proceedings. Nothing. And, as Jim Manzi of NRO explains above, that’s simply not how it works. It is an assumption without any real world foundation. We’re talking a zero sum assumption by the administration where no assets are bought, no one goes back to work, everyone is unemployed and no one can find a job. That’s just not the way bankruptcies (or the real world) work.
Second, some of the profit GM makes today would have been made by other companies that picked up some of the slack if the company lost market share after a bankruptcy. They would pay taxes on these profits, and as far as government receipts are concerned, money is money. How would auto industry structure evolve over time given whatever changes happened to the assets currently owned by the legal entity GM, or the employees currently paid by it?
Anybody who tells you they can answer all of these questions reliably is full of it.
Indeed. Again, the White House and its cronies must push the black and white version of this to make it saleable. If they can’t make you believe in their “either/or” scenario, then they can’t sell the lie. They’re banking on a large degree of economic ignorance to sell this. But they know that if they rely on the fact and figures they’re going to end up on the wrong side of the argument. So Klain says, break out the smoke and mirrors once again – sell it on emotion:
First, tell the story with fewer numbers and more emotion; less prose and more poetry. Rescuing the auto industry isn’t just a matter of saving jobs and factories — it means preserving a uniquely American manufacturing tradition. Cars are more American than apple pie or hot dogs (which, unlike the automobile, were both invented in Europe). We couldn’t have won World War II without this "arsenal of democracy"; as Walter Reuther famously said, "England’s battles were won on the playing fields of Eton, but America’s were won on the assembly lines of Detroit." The president needs to jujitsu Republican critics who accuse him of failing to understand American exceptionalism by pointing out his success in saving this exceptionally American industry.
You have to love the fact that even Klain doesn’t believe his own nonsense, but has no problem advising the president to use it. Note too that Klain seems not to remember that one of the reasons that GM and Chrysler were on the ropes had to do with the American public choosing competitive foreign cars over the American cars from those two companies (and with the VOLT, we see GM again in the same condition. But he feels if he wraps it all in emotions and not facts (a variation on “hope an change” that worked so well in 2008), they can fool enough voters into accepting the narrative or at least, not caring about it.
Second, equally emphasize the pain that was imposed as a condition of support, and the hard and unpopular choices the president made. It was a plan of “shared sacrifice,” in which executives were fired, workers lost jobs, benefits and pay were cut, and dealers were shut down. The story of the tough choices the president made along the way must be told to convince the public that this wasn’t a handout.
Of course, this plays into the part of the narrative in which you must believe their “either/or” scenario – that is had the government not acted, millions of jobs would have just vaporized. Of course, what Klain describes above would most likely have been the result of normal bankruptcy proceedings minus the $50 plus billion government money injected into GM. They don’t what that known though. And, naturally, they don’t want any speculation about what would have emerged, how many jobs would that would have entailed, etc.
If you start down that road and use the history of bankruptcies and the emergence of companies from that situation as a basis, you’ll have a very difficult time swallowing the administration’s story. So avoid those facts at all costs and concentrate on “emotion” and “pain”.
Finally – Klain advises the White House to crank up the propaganda:
Third, let the people of the auto communities tell their own stories — encouraging homegrown viral videos and other uses of social and new media. This is a lesson I learned the hard way during the 18 months I was part of the White House team that struggled to explain the benefits of the Recovery Act. We used visits by the president and vice president, videos posted on WhiteHouse.gov, as well as endless statistics and charts and maps and graphics on Recovery.gov — and yet nothing got the job done. Finally, two ice-cream shop owners made an iPhone video that told the story better than we ever had, by showing how a single small business loan rippled across their area to create jobs in countless other businesses.
The White House needs a similar personal narrative to tell the auto rescue story, or it will risk being denied a return to Victory Lane in 2012.
So there is the plan – “emotion, pain and propaganda” – that Klain claims the administration should use to sell something that is about as un-American as the internment of Japanese/American civilians during WWII. The most interesting part, of course, is Klain understands that if they get into the specifics of this “deal” and the facts come out, it ends up looking like a very poor decision. And Klain knows that the opposition, once it finally settles on a candidate and its own narrative, is going to seize on this subject as a part of their attack on the Obama record.
He instinctively knows that any chance of blunting that, or making it a non-issue, requires that the administration’s narrative be out there actively being pushed now and that it has to be spun properly for it to work.
How do you counter this? With facts. And the facts are aplenty. There is no shortage of factual information that can gut these arguments and show them for what they are – emotion and propaganda. The opposition also has to use “American exceptionalism” in its proper way and point to the fact that the administration misusing “exceptionalism” in its version.
And that doesn’t even start to get to the really long-run considerations of what effects this has on rule of law and moral hazard (or if you want to make the case for the bailout, social solidarity and degradation of the working class).
One of the things America prides itself on is “rule of law”. That is a large part of our exceptionalism. We also founded a country that attempts to avoid the moral hazards that abound in this sort of a situation. We are and for the most part always have been a meritocracy. You get what you earn. We don’t buy into exceptions because they’re “too big to fail”. We understand that freedom means the freedom to fail and we don’t bail out –selectively- failures. We don’t throw good money after bad, and we certainly don’t expect our government to interfere in that process.