Stable Geniuses And Unstable Markets…

The media is a worry when it starts to become a propaganda machine, rather than a reporter of facts. Of course, to some extent it’s inevitable that there’ll be a certain element of propaganda in the facts one chooses to present. However, I couldn’t help but find the headline in today’s The Australian a little more cynical than one would expect from a paper trying maintain the appearance of neutrality:

Apprentices: $10k to help PM keep job

Of course, it could be argued that every decision from every government is one designed to help the leader keep their job, but still…

Jeff Bezos, founder of “Amazon” (the company not the river, in case you’ve been asleep for past twenty years), is also the owner of The Washington Post. During the recent election campaign, he intervened to stop the paper endorsing Kamala Harris which prompted a bit of pushback… particularly as the paper’s masthead has the motto: “Democracy Dies In Darkness”. Of course, the problem, it seems, was that a large number seemed to think that this was a call to shine light on things rather than a simple statement of fact along the lines of “Most plants need the sun and water to survive” or “Drinking poison may shorten your lifespan” or “Good policy announced to help leader stay in power.”

In order to clear up this ambiguity, Bezos has suggested adding this as the paper’s mission statement: “Riveting Storytelling for All of America”.

Now, I know that sometimes it’s possible to read too much into things, but I will make the point that, while the events of the world can be constructed in such a way as to create a narrative, there is a subtle differing between “writing the stories” and “storytelling”. The first implies someone constructing an accurate description in a way as to help one make sense of events, while the second suggests that you’re making it up. When you add the word “riveting” it adds further evidence of a fabricated fiction, rather than a faithful recreation of what’s happened. After all, the idea that a journalist can consistently create a “riveting” narrative around some of the latest economic statistics is hard to believe.

When it comes to “riveting storytelling” you really have to hand it to President Trump. His idea that you can eliminate income tax by making other countries pay with tariffs is a compelling story and, like much good fiction, it relies on a willing suspension of disbelief. As almost every economist has pointed out, the tariffs are added to the imported goods and, as such, they are charged to the consumer not the supplier. The supplier is not going to say, “Oh, they’ve just added a 25% tariff so I better send off a cheque to Uncle Sam because it’s only fair that I’m charged so those nice Americans can stop paying tax.” The only likely consequence of a tariff is that it’ll make the price of imported goods more expensive so local competitors may get a boost.

This last point could potentially be regarded as a good thing by many. However, if you combine Trump’s two main ideas: 1. We want more manufacturing in the US rather than those countries where wages are cheaper, and 2. We want to get rid of all the migrants working cheaply in the US because they’re all felons and you can’t be a felon in this country unless you’re President, then what you’re left with is a potential wages explosion because there just aren’t enough workers to go round…

Yes, I can see that this could be considered a good thing also. The point isn’t whether it works out well; the point is that there will be a lot of unintended consequences, including the fact that some imports are things like raw materials and other resources used in the manufacturing process. Adding to their cost just bumps up the price of production and before you know it, everything costs twice as much… but hey, no income tax, so that’s good, eh?

His basic pitch was to tell everyone to “come make your products in America” because you’ll be paying the lowest tax and if you don’t you’ll have to pay a tariff so everyone should be making things in America because that helps Americans and as for the US companies who’ve moved offshore so that they can pay workers a fraction of the cost of American workers, well they can come back because of the lower tax and the threat of tariffs… And all those factories in other countries can just shut which will give all those exploited workers the chance to retrain as doctors or engineers…

Still, what would I know. I thought that it would be a dangerous precedent for the leader of a country to say that he was going to do something which was unconstitutional (his Executive Order on birthright citizenship probably violates the 14th Amendment).

I heard someone compare Trump to Caligula. This is a little unfair because Caligula was a Roman emperor, a murderous tyrant who demanded to be worshipped and was alleged to have made his horse, Incitatus, a consul. However, most historians accept that this horse story is false. Even if it were true, the comparison is unfair because Caligula would have never given Elon Musk so much power…

More and more I think of the clip from Woody Allen’s “Bananas”.

Also by Rossleigh: Things That Don’t Work Or Elon, Donald And Peter

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