Month: April 2021

What to do with Social Media?

Social media is changing how we get news and debate public issues. How should its contents be regulated and by whom? The answer should reflect the fundamental importance of free and open speech for forming broadly supported public policies and social attitudes.

The quality of public discussion in the United States today has deteriorated. There are even some who wish to end debate on some issues altogether (the cancel culture). Take two recent examples:

In reaction to Georgia’s new Voting Rights Act President Biden said: “Parts of our country are backsliding into the days of Jim Crow, passing laws that harken back to the era of poll taxes — when Black people were made to guess how many beans, how many jelly beans, in a jar or count the number of bubbles in a bar of soap before they could cast their ballot.” “Biden US backsliding-Jim Crow”

Representative Maxine Waters traveled to Brooklyn Center, Minnesota, to join crowds protesting the police shooting of Duante Wright. On that occasion, “A reporter then asked, if Chauvin isn’t convicted on all charges, “What should protesters do?”

“Well, we gotta stay on the street,” Waters said. “And we’ve got to get more active. We’ve got to get more confrontational. We’ve got to make sure that they know that we mean business.”

For her complete comments see: “In her own words-Maxine Waters”

In response to Water’s words Representative Marjorie Taylor Greene tweeted:

_________________________________  

@RepMaxineWaters you don’t live in Minnesota.

You crossed state lines and incited riots, violence against police, shootings at the MN NG, and threatened a jury as a sitting US Congresswoman.@SpeakerPelosi surely you will expel this criminal from Congress and uphold the law! pic.twitter.com/twH52VwFTP

— Marjorie Taylor Greene 🇺🇸 (@mtgreenee) April 19, 2021

_________________________________ 

“Marjorie Taylor Greene says Maxine Waters incited riots calls for her expulsion from congress”

‘Maxine Waters-Kevin McCarthy Minnesota police”

President Biden’s and Representative Greene’s comments both earn four Pinocchios. Senator Ted Cruz’s comments about Waters’ statement were just as bad. But then we are used to politicians lying to us, especially in the heat of campaigns. However, they do not contribute to the constructive dialog needed over these and other pressing public issues.  

With regard to Georgia’s new Voting Law, assessments are mixed. For example: “Rather than allowing voters to request ballots six months from Election Day, the new law says voters can start requesting ballots 78 days out; counties can begin sending ballots to voters just 29 days before Election Day, rather than the previous 49 days.” “Georgia voting law explained”

This hardly strikes me as voter suppression. I grew up in Bakersfield California and our voting precinct voted in our garage. As a kid I was fascinated by it all (though not thrilled with having to clean the garage for the occasion). There was no such thing as early voting except for absentee ballets by military service men and women. No drop boxes or any of that stuff. You came to our garage on election day or you didn’t vote. But there is surely a place for serious pros and cons of each provision of the law. As the press has been overwhelmingly (almost hysterically) negative (despite Georgia’s Governor and Secretary of State’s refusal to yield to Trump’s pressure to overturn his election defeat in Georgia) here is a more measured defense of the new law: “Exclusive 21 black leaders defend Georgia voting law as proper honest reform”

The real question is why were changes in Georgia’s voting law needed in the first place? What weaknesses were being addressed? Even with this new law, Georgia’s law is more permissive than those of Biden’s Delaware. In a negative, but more balanced assessment, Derek Thompson stated that:  “Georgia’s voting rights have long been more accommodating than those of deep-blue states including not only Delaware, but also Connecticut, Massachusetts, New Hampshire, and New York.” “Georgia voting rights fiasco”

Maxine Waters didn’t, and often doesn’t, use the best judgement in where, when and what she said, but she didn’t say anything that she should not be allowed to say whether you agree with her or not.  Referring to Reps. Waters and Rashida Tlaib, D-Mich, Newt Gingrich wrote that:

“House Democrats have produced two radical demagogues whose policies would endanger the lives of innocent Americans, lead to the breakdown of society, and undermine the U.S. Constitution.”  “Repudiate Tlaib and Waters promote mob rule Newt Gingrich” This is precisely the sort of name calling that impedes the serious dialogue over concrete issues and proposals that we so badly need. Demonizing opponents–turning opponents into enemies–is a tactic of the weak (think Vladimir Putin).

Rep Waters’ charge that protesters should get more confrontational did not strike me as an incitement to violence anymore (and rather less) than former President Trump’s call for his assembled supporters on January 6 to march to the Capital and “fight like hell. And if you don’t fight like hell, you’re not going to have a country anymore.” The brief submitted by Trump’s lawyers for his impeachment trail stated the “his call for the crowd to ‘fight like hell,’ was not meant to be taken literally.” OK, then perhaps he should keep it to himself. This reminds me of my favorite “apology” for lying about voter fraud that kept Trump from remaining in the White House. In response to a liable suit by the voting software company Dominion Voting Systems,  Sidney Powell stated in court that “’no reasonable person would conclude’ that her accusations of Dominion being part of an election-rigging scheme with ties to Venezuela ‘were truly statements of fact.’” “Sidney Powell-Dominion-No reasonable person”  Sadly I know some very fine people who did (or do) believe her nonsense.

But what if Biden’s, Trump’s, Waters’ and Greene’s comments were suppressed–erased–rather than challenged? These were opinions, however off the mark, rather than statements of fact. What if someone (named Trump) claims that Barack Obama was not born in the U.S. and thus not eligible to run for President (despite irrefutable evidence to the contrary)? I will spare you the very long list of such lies. And, to finally get to my real topic, what should social media do about it?  

Unlike newspapers and magazines, which are responsible for the accuracy of their content, Facebook and Twitter and Tiktok (I am too old to be current with all of the other newer platforms) “merely” provide the vehicle by which its users (you and me) distribute our content. The government does have laws that limit speech.  “Categories of speech that are given lesser or no protection by the First Amendment (and therefore may be restricted) include obscenity, fraud, child pornography, speech integral to illegal conduct, speech that incites imminent lawless action, speech that violates intellectual property law, true threats….and defamation that causes harm to reputation….”  “United States free speech exceptions”. What is not legally allowed generally, should not be allowed on social media. But in my opinion, those are the only restrictions that should be allowed in the law.  The last thing we want is Nancy Pelosi or Ten Cruz deciding what is allowed and not allowed on Twitter.

In short, beyond speech that is already restricted by law, the government should leave social media free to set their own policies for what they permit on their platforms.  But what should those policies be? In my opinion, all opinions should be allowed, even those, and especially those, that the platform operators consider wrong or repugnant. Bad policy prescriptions should best be countered by counter arguments not by censorship. It is not possible to over emphasize the benefit to America of free and open debate. Bad ideas are best countered and refuted by good ideas.  You are not likely to find a better statement of these views and a better defense of free speech than in Jonathan Rauch’s Kindly Inquisitors: The New Attacks on Free Thought.

But what about clearly fake news? Unfortunately, the distinction between fact and opinion is not always 100 percent clear. Tweeter should not have removed Donald Trump’s pages, though full of lies. Facebook should not have removed QAnon’s totally ridiculous conspiracy claims to take another extreme example. Many far less controversial posts have been removed as well for very unclear reasons. Facebook and other social media are working diligently to strike the right balance but are not there yet in my opinion. When Facebook or other social media platforms have good reason to doubt facts posted on their platforms, rather than remove (censure) them it would be better for Facebook to attach its warning and perhaps a link to more reliable information.

If Facebook (or any other platform) chooses to forbid hate speech, it would be better to rely on user complaints than its AI algorithm to determine what is hate speech. In an amusing, but not so amusing, example of the pitfalls of reliance on programmatic detection of disallowed speech, Facebook removed a post of a section of the Declaration of Independence because of its “nasty” reference to American Indians.  “Facebook censored a post for hate speech-it was the Declaration of Independence”

It is often argued that given the realities of network externalities (everyone wants to be where everyone else is), Facebook and Twitter are virtual monopolies and that this justifies more intrusive government regulation.  But the competition has expanded to include at the top of the list: YouTube, Instagram, Snapchat, Tumblr, Twitter, and Pinterest. Even Trump plans to launch his own platform. Facebook and the other popular platforms must ultimately please their users or they will be replaced even if network externalities are hard to overcome. It has happened before and can happen again. Government intervention to regulate platform content beyond the restrictions already in the law would be contrary to our traditional freedom of speech and potentially dangerous.

There are measures that the government might take to make competition easier. When phone companies were required to give ownership of phone numbers to the subscriber, making them easily portable from one phone company to another, competition received an important boost. Something similar might be done with social media data of users (e.g., username, friends, pictures and posts).

A much more challenging area concerns social media algorithms for directing users to others with similar interests (or beliefs) in order to better target the advertising that pays for it all. If users only see or hear the views of the likeminded, unhealthy ego chambers can be created and promulgated. Agreeing on constructive approaches to dealing with this danger will require more public discussion.

Summary: Demonizing political opponents is bad for democracy. Opponents are not enemies. There needs to be enough common ground for most of us to stand on if we are to remain a viable country. Free speech has been a very important feature of America and its flourishing. It is best to protect free speech and counter misinformation and bad ideas with rebuttal and better ideas. No opinion should be censured. Social media should flag questionable information rather than remove.

A liberal dad complained about the one-sided liberal (in the American rather than classical sense) education his children had received in college because, he said, “they are completely unable to defend what they believe.”

National Defense

American military strength (an important aspect of our national security) depends on the size, training, and equipment (weapons) of our military, which is very much dependent on the size and efficiency of our economy, which pays for it.  Devoting more of our productive capacity to the military reduces our economic capacity. Getting the balance right between military and nonmilitary uses of our resources is very important.  Knowing what military capacity we need to insure our defense requires assessing the sources of threats to our national security and what motivates their deployment.

The cold war was a confrontation with international communism, most heavily concentrated in the Soviet Union. This was an ideological enemy of free market, capitalist countries, whose goal was to spread its ideology to the entire world. There is no such ideological enemy today. The Chinese government wants to be strong and prosperous and doesn’t care whether anyone else follows their model or not. They do want the rules for global trade and interactions to permit their own domestic model. We need to engage China fairly in establishing international rules that serve everone.

Historically wars were generally about territory and political control, usually about moving boarders a bit this way or that.  The Mogul, Roman, Persian, British, Ottoman and other empires existed largely to extract economic gain from the territories they ruled, something more peacefully enjoyed today via free (or freer) trade.  The mere threat of war and the creation and maintenance of potential enemies is also a useful device for rallying countries around their leaders and for keeping the money flowing to their “defense” industries–think of Mr. Putin, Xi Jinping and the U.S. military/industrial complex.

American defense today requires military strength sufficient to deter any country from successfully attacking the United States. It does not require the 800 military bases that we maintain around the world.  It did not require and was not enhanced by our many wars that followed the infamous and very damaging Viet Nam war (Lebanon 1982-4, Grenada 1983, Panama 1989-90, Gulf War 1990-91, Somali 1992-5, Bosnia 1992-5, Haiti 1994-5, Kosovo 1998-9, Afghanistan 2001-date, Iraq 2003-11, 2014-date, Somali 2007-21, Libya 2011, 2015-20, Syria 2014-date, War on Terror in various places). War with China would be quite a different matter. “The delusions of high tech warfare”

Fareed Zakaria unloaded on our war industry last month: “Defense Secretary Lloyd Austin outlined his key concern. ‘China is our pacing threat,’ he said. He explained that for the past 20 years, the United States had been focused on the Middle East while China had been modernizing its military. ‘We still maintain the edge,’ he noted, ‘and we’re going to increase the edge going forward.’ Welcome to the new age of bloated Pentagon budgets, all to be justified by the great Chinese threat.

“What Austin calls America’s ‘edge’ over China is more like a chasm. The United States has about 20 times the number of nuclear warheads as China. It has twice the tonnage of warships at sea, including 11 nuclear-powered aircraft carriers compared with China’s two carriers (which are much less advanced). Washington has more than 2,000 modern fighter jets compared with Beijing’s roughly 600, according to national security analyst Sebastien Roblin. And the United States deploys this power using a vast network of some 800 overseas bases. China has three. China spends around $250 billion on its military, a third as much as the United States.”  “The Pentagon is using China as an excuse for huge new budgets”  As noted above, over-investing in the military results in a smaller economy overall.

The latest debate is whether we should make our commitment to go to war with China to defend the independence of Taiwan explicit or leave it implied and ambiguous. In 1979 the U.S. recognized the People’s Republic of China as the sole legal Government of China and acknowledged that Taiwan was part of China (slightly fuzzy diplomatic language). So would American national security be enhanced by an explicit credible commitment to go to war with China, if necessary, to preserve the independence of Taiwan? China is a nuclear power. Going to war with China (World War III if we could get anyone else to join us) would inflect enormous damage on the U.S. whether it became nuclear or not, even if we won. In my opinion it would be simply insane to take such risks.

Would the U.S. deter China by being tough enough?  As Doug Bandow put it: “America’s antagonists saw something very different than weakness…. Stupidity and arrogance. Poor judgment. Refusal to admit mistakes. An almost demented willingness to sacrifice America’s future in a desperate attempt to redeem the nation’s tragic past. A better way not to show weakness would be to stop doing ‘stupid shit,’ as Obama suggested.

“China’s Xi Jinping and his colleagues in Zhongnanhai likely have a far more objective and practical take on U.S. policy: Endless wars by Washington are good for Beijing. The Chinese would love to see the US pour trillions more dollars and thousands more lives into new conflicts. Invade Iran? Please! Maybe occupy Syria too? Lebanon also needs fixing. Don’t forget the need to redeem Afghanistan. Then there is the problem of Russia in Ukraine, Syria, and elsewhere: go for it!”  https://original.antiwar.com/doug-bandow/2021/03/23/the-failure-of-huff-and-puff-foreign-policy/

But China (and Russia in Ukraine) has been behaving badly–claiming this little island in the China Sea and that one as its own, not to mention the ever-present risk of invading Taiwan. Even if the forced takeover of Taiwan by the PRC would not threaten our national defense, shouldn’t we care? Shouldn’t we care about the abhorrent genocide by the Chinese government against its Uighur Muslim minority in its western province of Xinjiang? Of course, we should, but we should reject the presumption of our neocon friends and the military/industrial complex we keep fat and rich that these and other interests can only be addressed militarily. See my experiences in Iraq and Afghanistan: “My Travels to Baghdad”

The creation of the United Nations and Bretton Woods institutions and other international cooperative agreements and institutions after World War II were meant to provide dispute resolution mechanisms other than wars. President Biden is committed to rebuilding these neglected institutions and strengthening and reenergizing our diplomatic institutions and initiatives. We can confront China more effectively and more realistically together with most of the rest of the world using the tools of diplomacy rather than of war. If the people of Taiwan chose to integrate their governance more fully with that of the PRC, that is their choice and their business. But if China invades Taiwan or otherwise forces such an integration, China should know the economic and political price they would pay. In my opinion, such a declaration would be far more effective in deterring such behavior by China than a fuzzy uncertain threat of war. It is encouraging that Congress seems on the verge of reclaiming its War Powers provided by the Constitution.

It is worth remembering the words of Dr. Martin Luther King, Jr. against our war in Vietnam delivered April 4, 1967. https://kingandbreakingsilence.org/

The Corporate Income Tax

Should the U.S. Corporate Income Tax be increased from its current 21% (plus state corporate income taxes that average about 5%) back to 28%? No, it should be reduced to zero. The corporate income tax should be abolished. Only people pay taxes, either workers from their wages, consumers in the prices they pay goods and services, or shareholders from their business incomes. The corporate income tax, taxes these people twice.  So who really pays a corporate income tax?

One of the standards applied by economists for a “good” tax is that it does not distort the allocation of resources. If tax treatment encourages investments that are less productive than otherwise, output will be lower, and we will be poorer. This is called the tax neutrality principle. “Next up: tax-reform”  The corporate income tax violates this principle because it taxes the same income twice contributing to a bias toward debt rather than equity financing. The activities of corporations generate wage income to its workers, which is taxed as income of its workers. Their purchases of supplies and services from other companies generate income for those companies, which are taxed there. The difference between a corporation’s revenue on its sales and these expenditures–its profit–is paid to its owners (shareholders) and is taxed as part of their incomes.

But corporate income is taxed again in the name of the company itself–double taxation. That tax must come from some combination of reduced employee remuneration (wages and benefits) and shareholder income.  Studies indicate that it comes largely from reduced wages. https://www.forbes.com/sites/johngoodman/2021/04/02/who-pays-the-corporate-income-tax/?sh=4eb92e9b58ab

Another problem with this double tax on corporate income is that many corporations operate in many countries. It is not easy (if even possible) to agree with each of these countries, which have their own tax policies, which income to tax in which country. Companies have become expert at shifting their activities and attributing income to the lowest tax jurisdictions.  Where, for example, is the intellectual property, which can be an important source of company’s income, owned for tax purposes? The answer is often Ireland.

Economists agree that the most neutral tax is a flat rate consumption (sales) tax.  “The Principles of Tax Reform” Consumption would be taxed were it takes place thus avoiding the issues in current income taxes of where the income is produced. In our global, internet linked world, the applicable consumption tax would be the one levied on the residence of the consumer as it finances the government services provided there.

In an earlier note on a Universal Basic Income, I presented back-of-the-envelop estimates of the consumption tax rate required to finance a UBI of 18,000 dollars per year for each and every adult and half of that amount for children (under 20 years old) if we abolish all income taxes (individual and corporate) and replace existing entitlement programs (Social Security, Medicare, Medicaid, food stamps, unemployment insurance, etc.) with that UBI. The combination of a flat rate consumption tax and a UBI produces an interesting degree of tax progressivity relative to income. I hope that you find it interesting. “Replacing Social Security with a universal basic income”

Vaccine Passports

Discussions of the pros and cons of mandated lock downs to stop (or slow) the spread of Covid-19 often miss the most important point. The key factor in restraining the spread of a contagious disease (beyond vaccines, basic public health measures, etc.) is the behavior of each one of us. Given our respective risk preferences the question is whether we adjust our behavior sensibly to protect ourselves and others from infection? Our behavior may be responding to government mandates to close restaurants, theaters, and factories or it may be responding to information provided by public health experts on the nature of the risks and measures to mitigate them. In the latter case our experience and that of our neighbors will depend importantly on the quality of the information provided and our trust in its efficacy. Our individual choices allow responses that are more suited to the individual situation of each actor.  “The unnecessary fight over covid-19”

In short, if governments were to say, “do whatever you want, but these are the risks as we understand them,” people would not necessarily rush to the concert hall, or baseball game, or hop on a plane. “Sports fans live attendance poll”  Offices, factories, restaurants and entertainment venues must convince their workers and customers that they have taken reasonable steps to be safe from Covid-19 (or other risks). Thus, comparing the results (infections and economic output) of lock down with no (or mild) lock down countries is not the right test.

We need to focus attention on the quality of the information being provided to the public, the public’s trust of such information, and the efficacy of the measures being taken by those offering reasons to gather in public places to enhance its safety. Those who have had Covid-19 or who have been vaccinated for it face minimum risk of catching it (again) or of spreading it and can pretty safely attend public events. Thus, a trustworthy way of establishing that fact would be very useful. I carry my vaccine certificate wherever I go but they are relatively easy to counterfeit if it became useful to do so. Thus, the reason behind the various projects to develop so called vaccine passports (better named vaccine certificates) is obvious.

The technical design, including privacy protections, raise more issues than you might at first imagine, including establishing interoperability standards and access to public records. However, the position taken by Florida Gov. Ron DeSantis defies understanding by those of us who place our individual freedom in first place. He stated that: “We are not supporting doing any vaccine passports in the state of Florida…. It’s completely unacceptable for either the government or the private sector to impose upon you the requirement that you show proof of vaccine to just simply be able to participate in normal society.”  “Biden vaccine passports-DeSantis”  This is incredibly wrong. Restaurants now serving indoors already test our temperature before allowing us to enter. I visited my credit union in the IMF building in downtown Washington, DC today and they took my temperature as well. If gatherings are not convincingly safe, sensible people won’t attend. Countries requiring arriving passengers from other countries with a high incidence of Covid-19 infections to quarantine for two weeks would presumably wave that requirement for passengers with a credible vaccine certificate.

It is hard to imagine that the public accommodation clause of the Civil Rights Act of 1964 would require a restaurant to admit and serve a customer with a contagious disease. But there are privacy and other technical concerns with implementing a reliable certificate of a covid vaccine. “The next front in the pandemic culture wars vaccine passports” The benefits to the economy and our freedoms are significant enough to make the effort to overcome them.