Divided We Stand - United We Fall

Extraordinary Popular Delusions and the Madness of Facebook

2012-05-18T07:58:00.002-07:00

The Facebook IPO priced at $38 per and the offering was increased 25% by over 100 million shares. At this price Facebook will be the largest tech IPO in history and second largest IPO of all time behind VISA. Depending on how the offering trades, it may finish the day as the largest offering of all time. At the IPO price Facebook as a company will be valued more than tech giants Cisco, Amazon, and more than all except 20 other companies listed on the S&P.

There is no shortage of advice on how to assess the value of Facebook's stock. You can easily find analysis outlining the bull case, the bear case, and everything in between. The financial news networks have turned all their programing over to 7x24 Facebook coverage. Many spent $5.00 to download an anonymous author's analysis in e-book form - The Pitch. This blog will not try to assess the merits of the company value versus the IPO value versus the value of as it trades in a speculative frenzy. However, we will suggest that the best book for analyzing the Facebook offering is available for a free download for your Kindle, or on the web.

Charles Mackay's Memoirs of Extraordinary Popular Delusions and the Madness of Crowds was first published in 1841 and summarized three economic bubbles:

"Among the bubbles or financial manias described by Mackay are the South Sea Company bubble of 1711–1720, the Mississippi Company bubble of 1719–1720, and the Dutch tulip mania of the early seventeenth century. According to Mackay, during this bubble, speculators from all walks of life bought and sold tulip bulbs and even futures contracts on them. Allegedly some tulip bulb varieties briefly became the most expensive objects in the world during 1637. Mackay's accounts are enlivened by colorful, comedic anecdotes, such as the Parisian hunchback who supposedly profited by renting out his hump as a writing desk during the height of the mania surrounding the Mississippi Company."

Submitted for your consideration - Charles Mackay's insight into the Facebook IPO:

"We find that whole communities suddenly fix their minds upon one object, and go mad in its pursuit; that millions of people become simultaneously impressed with one delusion, and run after it, till their attention is caught by some new folly more captivating than the first. We see one nation suddenly seized, from its highest to its lowest members, with a fierce desire of military glory; another as suddenly becoming crazed upon a religious scruple; and neither of them recovering its senses until it has shed rivers of blood and sowed a harvest of groans and tears, to be reaped by its posterity...

Money, again, has often been a cause of the delusion of multitudes. Sober nations have all at once become desperate gamblers, and risked almost their existence upon the turn of a piece of paper. To trace the history of the most prominent of these delusions is the object of the present pages. Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, and one by one."

Your loyal blogger is no more immune to the "delusion of multitudes" than anyone else. He has begged his discount broker for any allocation of the stock. Why not? I like tulips.


Semper Augustus, the most expensive tulip sold during tulip mania

Good luck to anyone lucky enough to be allocated shares.

Remember the trading aphorism - "No one ever went broke selling too soon".

Sell early, sell often.

Carnival of Divided Government LIII Três et Quînquâgintâ Special May Day Edition

2012-05-01T23:52:00.011-07:00

Welcome to the 53rd edition of the Carnival of Divided Government - Special "MAY DAY GENERAL STRIKE!!!!" Edition. It is the First of May - International Worker's Day - May Day - and the official start of the Occupy [FILL IN THE BLANK]! protest season.

Today the Occupiers kick off the season by calling for a national General Strike. Their inspiring motto: "No Work. No School. No Banking. No Shopping. No Housework." is emblazoned across dramatic posters calling for May Day protest actions. Vera HC Chan has identified what may be their most important and lasting cultural contribution: "Whatever the outcome of May Day, one thing has clearly emerged -- the return of propaganda art."

Wait. What? No House Work? Yeah. The poster actually says "No House Work." Is this really how the "99%" are going to stick it to the man? No house work? Some of the posters substitute "No Chores". No joke. It's like an Onion story.

Here in EssEff, the Occupiers were very excited about closing the Golden Gate Bridge. Until they decided not to close the Golden Gate Bridge. Then, apparently experiencing some Midwest Protest Envy, they decided to embark on a "Wisconsin-Style Occupation of San Francisco City Hall". And just like in Wisconsin, about 300 protesters marched into City Hall carrying sleeping bags, made some noise, then left. I guess that is sort of like what happened in Wisconsin. Well, if all else fails, they always have breaking windows and vandalizing small businesses in minority neighborhoods to fall back on.

The Dividist is disappointed that "No Blogging!" was not included in the general strike directives. He now has no excuse for failing to get this latest Carnival of Divided Government posted as scheduled.

Carnival of Divided Government LIII
Special May Day Edition

As explained in earlier editions, we have adopted Latin ordinal numeration to impart a patina of gravitas reflecting the historical importance of the series. In this the Carnival of Divided Government LIII (Três et Quînquâgintâ), as in all of the CODGOV editions, we select volunteers and draftees from the blogosphere and main stream media writing on the single topic of government divided between the major parties (leaving it to the reader to sort out volunteers from draftees).

Consistent with this topic, the primary criteria for acceptance in the carnival is to explicitly use the words and/or concept of "divided government" in submitted posts. A criteria that, to our endless befuddlement, is ignored by many of the bloggers submitting posts, which sadly results in The Dividist reluctantly ignoring their fine submissions. Among the on-topic posts, essays and articles we choose our favorites for commentary and consideration. We hope you enjoy these selections, and without further work stoppage, we submit for your consideration this month's selections:

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Harry Lambert, Political Editor of the University of York's student newspaper NOUSE is disappointed in Democrats and wonders "If this is what it is to be a Democrat, why bother?":

"With no one party controlling all the institutions of government, one might expect legislative gridlock. But divided government has not always led to such inaction. For all but two of the 28 years Presidents Eisenhower, Nixon, Ford, Reagan and Bush Sr. were President, Democrats were in charge of at least the House. And yet those Presidents managed to govern. As David Mayhew has argued, divided government did not lead to the introduction of fewer innovative policies. And while the innovativeness of policies is contestable, what is undeniable is that a spirit of bipartisanship existed then and no longer does.”

Actually it is perfectly deniable. In this recent incarnation of divided government, we have seen bills passed on a bipartisan basis and bills defeated on a bipartisan basis. To his credit, Harry does avoid the conventional and intellectually lazy path of blaming divided government for a lack of legislative productivity. He correctly cites Mayhew's finding that legislative productivity does not correlate with periods of united vs. divided government. However, he misses Mayhew's contention that change occurs when there is a pervasive public demand for that change. The jury is still out on this congress. There is still reason to believe that this Congress will address the unsustainable debt and spending in Washington DC. It probably won't happen until the lame duck session, but it will be addressed and it will be addressed in a bipartisan manner, and Harry Lambert will still be disappointed.

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Jay Ambrose writes a syndicated column picked up by the Wicked Local Framingham. He is as disappointed in conservatives and libertarians as Harry was in Democrats, explaining that re-electing Obama presents "High stakes for the right":

"...some conservatives and libertarians I ordinarily respect are saying oh, ho hum, it is no big deal if President Barack Obama gets re-elected because — listen up, worriers — we have separation of powers. We have divided government. Both houses of Congress are likely to be Republican after November’s election, and they will keep this guy in check. Excuse me, but have these fine folks paid any attention whatsoever to the past century or so of American history, to the gradually, then dramatically growing power of the executive?"

Jay has a point, but overlooks several others. Voters of an independent mind, in particular libertarians, are more concerned with the enhanced executive power of a republican president unconstrained by a lay-down republican congress, than a democratic president fighting a republican congress. Returning to One Party Rule will make the problem of executive branch overreach even worse than it is today.

A potential silver lining when executive and legislative branches are divided on partisan lines: Any additional overreach by the President may act as a catalyst for Congress to finally reassert itself and reclaim it's constitutionally mandated power and authority usurped from the executive branch.

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Jamie Stiehm at US News knows exactly who to blame for the gridlock. It's those darn Republicans. She cites Ornstein and Mann to confirm her carefully considered bias that "The Republicans Are Burning Down the House of Democracy":

"Mann and Ornstein observe, "Divided government has produced something closer to complete gridlock than we have ever seen." Yes, and please pass the potatoes. Republicans are acting the same way they ever did (late in the last century) in opposition to a Democratic president. It's just that they took a half-time break, easing up during the long years of the George W. Bush presidency and its wars. The Mann-Ornstein analysis (published in a new book available this week) is sound and welcome. At last an "official" acknowledgement that there is no center in national politics, so therefore it cannot hold."

Jamie's complaint can be distilled to this: "Republicans are destroying democracy because they refuse to vote like Democrats." There is nothing quite so galling to liberal Democrats as Republicans voting like Republicans.

But, there is a reason why there was a Republican electoral tsunami flipping control of the House in 2010. Voters simply did not want more of the insane fiscally irresponsible spending on display during two years of Democratic Single Party Democratic Rule. They saw two trillion dollars of new spending passed in two bills in two years on purely partisan Democratic votes (Obamacare and Porkulus). Enough was enough. Republicans in congress are doing exactly what they were voted to congress to do. As regards Mann & Ornstein, the Dividist will just note that they used to support divided government, but that was when it was Republican One Party Rule being divided.

In case there is any doubt whether Democrats hold at least an equal share of the blame for budget and deficit gridlock...

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Scott Wong of Politico interviews Retiring Democratic Senator Kent Conrad, Chairman of the Senate Budget Committee, and explains how the "Kent Conrad budget is a study in congressional gridlock":

"Conrad said he’s tried to fight through all the congressional gridlock and inaction: “I don’t spend much time being frustrated because I don’t think it does any good. I just keep plugging away to try to get done what I think is so important for the country...

Last year, despite weeks of behind-the-scenes negotiations with his own conference, Conrad abandoned a budget markup after it became clear it lacked support from Democrats, who complained it was too conservative. Majority Leader Harry Reid (D-Nev.) sealed its fate, saying it was “foolish” to pass a budget as Vice President Joe Biden was negotiating a deal to raise the debt ceiling. With eight months left in his final term, Conrad is returning to Bowles-Simpson, a Quixote-like effort considering the House last month rejected that plan 38-382, and Reid shows no desire to touch the commission’s deficit blueprint."

We can blame Democrats, we can blame Republicans, or we can just blame both...

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Kevin Williamson at NRO also read the Mann-Ornstein piece, and does not assign the blame uniquely to either Republicans or Democrats, noting that "Extremism Is Not the Problem; Bipartisanship Is" :

"Divided government can sometimes have good results, as it did during the Gingrich– Clinton years, but it can also have bad ones. When the government is divided, or when the majority party holds only a very small majority in one of the houses, there are very powerful incentives to accede to the least painful of the other side’s demands. Democrats have been energetic in condemning the “Bush tax cuts” and blaming them for the high deficits currently afflicting us, but they have made no serious effort to repeal the bulk of them, because the majority of the tax cuts went to households earning less than $200,000 a year. In fact, Democrats have touted the payroll-tax deal as a key domestic achievement, as though talking Republicans into supporting an irresponsible tax cut were one of the labors of Hercules."

The Dividist is sympathetic to Kevin's argument. Examples of truly bad bipartisan legislation are legion. But as that noted Political Scientist Albert Einstein once said: "It's all relative." We are grading on a curve here. The risk of bad bipartisan legislation under divided government is not as bad as the parade of horribles to be seen when partisan legislation is passed under One Party Rule. We don't always get good compromise under divided government. But we never get meaningful compromise at all under One Party Rule.

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Shane Goldmacher at the National Journal analyzes recent polls and worries that "Public Opinion Could Lead to Further Gridlock":

"Even after more than a year of pointed disagreements between President Obama and House Republicans, a narrow plurality of voters said that Washington is “more likely to make progress” on the major issues facing the country if it has a divided government after the 2012 elections. Both parties are furiously trying to sell their vision to the nation, but wary voters, after three consecutive wave elections that saw at least 20 House seats change party hands, don’t appear ready to grant either side an unequivocal mandate."

He says that like it's a bad thing. It's not. Shane's conclusion makes the Dividist feel all warm and fuzzy inside.

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Dashiell Bennet contributes to The Atlantic and wants us to know that "Grover Norquist Has No Interest in Bipartisan Cooperation":

"The only thing Americans seems to agree on these days is that we can't agree on much. With a divided Congress, a 5-4 Supreme Court, and a president who has as much difficulty with his own party as the opposing one, it seems like a legitimate miracle when our government accomplishes anything. Presidential historian and former presidential adviser David Gergen says things have gotten so bad that "we're in danger of national decline" because we can't resolve any of our issues.Maybe the question isn't "Why can't we all get along?" but "Did we ever?" ...

The trouble with our ideologically strident system is that the center no longer exists, and that puts the ability to compromise in danger. David Gergen remarked that James Madison would be appalled at the state our discourse, because while the Constitution was designed for a clash of ideas, the clash was supposed to "lead us to a higher place, not a lower one." ...

To Norquist, however, the solution is simple: a Romney victory combined with a Republican Senate takeover (complete with supermajority) by 2014. Then, as far as he's concerned, the problem of gridlock will solve itself."

This article puts the dilemma confronting independent/centrist/libertarianish voters into crystal clear perspective. There are worse things than division and gridlock. We are a divided country. As a consequence we have a divided government. We can have a united government, but only if it is United One Party Democratic Rule or United One Party Republican Rule. If you want a centrist policy result, you can get an approximation of moderate/centrist policy by always voting for divided government. Compromise is forced. It is painful, it is ugly, but compromise happens when it needs to happen. It does not matter if there is no "center", we can still get a centrist result. A barbell has no center. It can still be balanced.

BTW - Gergen is flat wrong about James Madison. Madison had no illusions about the nature of those who would govern, why we need separation of powers, checks, balances, and division among those who would rule over us and a prescription of exactly how to manage it. From Federalist #51:

"Ambition must be made to counteract ambition. The interest of the man must be connected with the constitutional rights of the place. It may be a reflection on human nature, that such devices should be necessary to control the abuses of government. But what is government itself, but the greatest of all reflections on human nature? If men were angels, no government would be necessary. If angels were to govern men, neither external nor internal controls on government would be necessary. In framing a government which is to be administered by men over men, the great difficulty lies in this: you must first enable the government to control the governed; and in the next place oblige it to control itself."

True. One way to keep our constitutional checks on power reinforced and not undermined is for a few percent of the electorate to consistently vote to prevent one party control of the executive and both legislative branches. To pit ambition against ambition.

Speaking of James Madison....

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Tom Burgum of the Longboat Key News thoughtfully puts it all in the context of the latest hotbed issue facing the Supreme Court in "ObamaCare vs. James Madison":

"While the future of ObamaCare is an important political question, the really important issue before the court is whether they will finally draw the line on the power of the Commerce Clause or say goodbye to James Madison’s system of limited and divided government powers...

There would not be massive grieving in Washington should Madison’s concept of government be sent to the waste bin, as many today are hostile to the concept of divided government. “He is,” wrote columnist Rich Lowry, “a most inconvenient Founding Father since he tells us: No, the federal government can’t do whatever it wants; no, we can’t all just get along; no, we can’t rush to pass whatever legislation is deemed a ‘can’t wait’ priority by the president. Now, grow up....

Madison even foresaw the coming of ObamaCare and Nancy Pelosi’s Congress. What else could he have had in mind when he cautioned the Convention and future generations: “It will be of little avail to the people, that the laws are made by men of their own choice, if the laws be so voluminous that they cannot be read, or so incoherent that they cannot be understood; if they be repealed or revised before they are promulgated, or undergo such incessant changes that no man, who knows what the law is to-day, can guess what it will be to-morrow.” Remember when Nancy Pelosi told us “we have to pass the bill to find out what’s in it?”

Genius.

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Mary Charuhas at Saint John's Catholic Prep has ambitions to be a journalist. Her story at The Viking Voice bodes well for her future as she analyzes the intersection of divided government and the national debt in "The Growing National Debt":

"The White House unveiled their new budget request last Monday. However, it is doubtful that it will be able to pass with such a divided government and economists say that it will do little to fix our major economic problems...

Along with the current GSA scandal of government over-spending and the Secret Service Scandal the American public is fed up with the government spending their money on what they see as useless. The economy is dire and the added stress of these scandals has the government in a tizzy and Americans in disbelief...

It is clear that something needs to change in order to combat the national debt. The country will never be able to return to the prosperous times if the attitude of the national government does not change and do what is best for the American people."

Fear not Mary. Churchill may have said it best. "Americans can always be counted on to do the right thing...after they have exhausted all other possibilities." So it is with our government.

For real compromise we need divided government and to force action we need a crisis. Both will be in place at the end of the year. A grand bargain will be hammered out if "sequestration" is perceived a sufficient crisis...

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Kate Brannan of the Federal Times sets the table for a Grand Bargain possible after the fall election and determines that no matter what happens in the election, it will be bad in "Sequestration could be left to lame-duck Congress":

"When Congress returns to work after the November elections, some members will have lost their re-election bids and will know that come January, when the 113th Congress begins, they will not be returning to Capitol Hill. Speaking March 27 in Washington, Rep. Barney Frank, D-Mass., predicted December would be the most powerful lame-duck session in history, with the results of the November elections shaping everything. While a decisive win for either party would remove any incentive to tackle these big problems in December, the consensus is that divided government is here to stay.

The likelihood that either side will receive a mandate to act from the election is very low, said Mackenzie Eaglen, a fellow at the American Enterprise Institute. While the White House or one of the congressional chambers could flip, the government will likely remain divided between the two parties, she said. For that reason, the results of the election may not matter all that much, Berteau said. "I have cautious optimism that the lame duck might be able to solve this, almost regardless of the outcome of the election," he said. For now, Berteau is not alone in his optimism. "There is a genuine desire on the part of members of both parties for a deal that goes big," Eaglen said."

Here is the thing. Divided government doesn't work until it does. Divided government only works when it needs to. It needs to work before the end of the year. So it will.

With that we conclude this edition. Look for the 54th Edition of the Carnival of Divided Government Quattuor et Quînquâgintâ (LIV) - Special Day of Mourning for The Loss of the Colonies Edition - sometime on or about July 5. Please submit your blog article at the carnival of divided government using our carnival submission form.

Divided and Balanced.™
Now that is fair.

Dividist Doubles Down on Divided Government for Six Year Blogiversary

2012-04-23T23:41:00.000-07:00

The Dividist let several auspicious dates float by without comment over the last week, including Earth Day, 4-20 Day and Tax Day. The latter is responsible for us missing the former. One date that we cannot let slip by is the six year blogiversary of The Dividist Papers (aka Divided We Stand United We Fall). We celebrate by reflecting on the journey as we paraphrase previous posts, plagiarize ourselves, and update some familiar themes and favorite topics.

Six years ago today, the Dividist started this blog by asking the question "Is this blog for you?" As no one else was reading the blog at the time, the Dividist answered his own query saying "Probably not."

Looking back on those first three posts from April, 2006 we take a certain perverse pride in offering a coherent and consistent thematic content from then until now. Then, we advocated a straight Democratic vote in the 2006 mid-terms in order to break the hegemony and consequent bad governance of Single Party Republican Rule [two trillion dollars expended in two unfunded decades-long nation building exercises in the Middle East]. Four years and two elections later we were advocated a straight Republican vote in the 2010 mid-terms to break the hegemony and consequent bad governance of Single Party Democratic Rule [two trillion dollars of new spending in two bills passed in pure partisan votes in just two years of One Party Democratic Rule]. In between we had two years of divided government, and again we now find ourselves in the midst of a divided government hiatus from those disastrous episodes of single party control pushing us toward the abyss of financial insolvency.

Changing teams in support of a political objective is incomprehensible to partisans who are psychologically incapable of voting for anyone outside of the their preferred party for President, Senate, or House of Representatives. Partisans generally subscribe to the “My party is on the side of angels and the other party is the spawn of satan.” rationalization for tribal politics. Their vote at the federal level is as predictable as sunrise and sunset and they represent the vast majority of the electorate. Studies show at least 70% and probably closer to 80%+ of the electorate vote as rabid partisans in federal elections regardless of whether they choose to label themselves by their party of preference, or as an independent, or as a moderate/centrist. Most self-identified "Independents" are closet partisan voters.

Not that there is anything wrong with that. Some of the Dividist's best friends are partisans. The correct way to to think of Partisan Dead Weight is as ballast - so long they stay roughly balanced on the right and left, they provide stability for our ship of state and keep it from listing too far to the port or starboard.

If early polls are any indication, the Partisan Dead Weight in the 2012 election will be as as evenly split and balanced as we have seen in recent decades. It is because of them that a relative sliver of the electorate who are true independents, voters who will swing their vote at a federal level between the major parties, can decide the complexion and direction of our government. They just need an organizing principle so they do not cancel themselves out. Until our political parties learn how to play nice with others, voting for divided government is a simple organizing principle that will keep both parties in check, force compromise, and yield centrist solutions. In this highly contested election year the Dividist will shoulder on and continue to push that divided government rock up the mountain. One more time.

The problem is these darn presidential election cycles (1992, 2000, 2004, 2008), where the electorate exhibits collective amnesia and tends to give one party all the keys to the castle. If it happens this time, it is likely to be a return to Republican control. Hopefully the country has moved beyond this collective learning disability and will keep the government divided - at least until our leaders slow or turn our hell bound bus away from plunging off the fiscal cliff as we careen down the mountainside at breakneck speed.

Our worst prediction over the history of this blog took place as we approached the debt ceiling "crisis" vote last summer. Based on the premise that our government only acts decisively and correctly when an imminent crisis forces them to act, and further assuming that we were staring into the financial abyss, the Dividist expected and predicted a "Grand Bargain" to be struck by our divided government leadership. We thought it would certainly happen either before the vote last summer, or with the formation of the "Super Committee" by the end of the year. We were wrong. Our leaders simply kicked the can down the road for another year.

In retrospect, the manufactured "Debt Ceiling" crisis last July, and the subsequent manufactured "Super Committee" deadline passed without meaningful resolution for one reason. The crisis and deadline were not real and everyone knew it. However, we think we now have in place a real (although still manufactured) crisis facing us at the end of this year. It even has a name. The "Fiscal Cliff". John Harwood explains:

"...beneath the campaign noise, some elected officials and policy experts see improving odds for 2012 to end up yielding much more, including progress toward a deal on tax and budget issues that have confounded Washington’s divided government.

... two looming events — an automatic $1.2 trillion budget “sequester” hitting defense and domestic spending, and the expiration of all of President George W. Bush’s tax cuts — will create pressure for the two parties to strike a compromise. “The probability of a deal strikes me as pretty high, since no agreement would be such a disaster,” said Peter R. Orszag, President Obama’s former budget director.

Mr. Ryan, who has absorbed more blows from Democrats over the budget than any other Republican, predicted, “We’ll get a deal in 2013 because we have to.”

“There are multiple factors that could come up and cause this to fall apart,” said Ms. MacGuineas of the Committee for a Responsible Federal Budget. “But there’s one factor that keeps it together: Everyone knows it has to happen.” Whether Mr. Obama or Mr. Romney wins in November, “nobody should want to govern without this deal,” she said. “It frees space and time for the other parts of their agenda — besides having to save $5 trillion."

The Dividist is All In. We are doubling down on last year's prediction. All we needed was a "real" crisis with a "real" deadline. Now we have one. We were not wrong. Our timing was off. We will get a Grand Bargain this year, under this divided government, that actually deals with the spending and debt. Really. We mean it this time. It will probably happen during the lame duck session, but maybe - just maybe - we might get it before the election. It could happen. And if true independent swing voters want to see this deal compromise struck somewhere near the rational center, the one way to be sure that happens is to vote to keep the government divided.

Divided and Balanced.™
Now that is fair.

William A. Niskanen - The Godfather of Divided Government Voting Strategy

2012-04-14T16:14:00.004-07:00

Bill. Niskanen, long-time member and chairman emeritus of the Cato Institute passed away last October. This tribute video was presented at a Cato Institute memorial service last week.

The Dividist considers Bill Niskanen to be the "godfather" of this blog. His work on divided government was our original inspiration and impetus to craft and advocate a consistent divided government voting heuristic. Our first post six years ago referenced Niskanen's analysis on divided government. His work was cited here repeatedly over the years.

The video tribute is an appreciation of the man and his values. It highlights Niskanen's uncompromising conviction that empirical evidence must drive policies and politics, along with his refusal to let partisanship trump principle. Despite being a Republican and despite being part of the Nixon and Reagan administrations, he publicly broke with both administrations over price controls and federal spending.

His willingness to put principle and empirical analysis over partisanship was again in evidence in 2006. AFter six years of Republicans controlling the White House and both legislative branches, with a key mid-term election imminent, life-long Republican Bill Niskanen contributed an essay to a Washington Monthly compilation of disgruntled high profile conservatives. He touts the virtues of divided government and effectively endorses a vote for Democrats in his essay - "Give divided government a chance":

"For those of you with a partisan bent, I have some bad news. Our federal government may work better (well, less badly) when at least one house of Congress is controlled by the opposing party. Divided government is, curiously, less divisive. It’s also cheaper. The basic reason for this is simple: When one party proposes drastic or foolish measures, the other party can obstruct them. The United States prospers most when excesses are curbed, and, if the numbers from the past 50 years are any indication, divided government is what curbs them...

American voters, in their unarticulated collective wisdom, seem to grasp the benefits of divided government, and that’s how they’ve voted for most of the past 50 years. To be sure, divided government is not the stuff of which political legends are made, but, in real life, most of us would take good legislation over good legends. As a life-long Republican and occasional federal official, I must acknowledge a hard truth: I don’t much care how a divided government is next realized. And, in 2006, there’s only one way that’s going to happen."

The Dividist appropriated Niskanen's title of this remarkable piece and was even inspired to exercise his rudimentary photo editing skills in a post promoting the article.

"All we are saaaying...

...is give divided government a chance."

The essay is also reprinted in chapter 25 of Niskanen's last book "Reflections of a Political Economist - Selected Articles on Government Policies and Political Processes". For a limited time, the Cato Institute is offering the electronic version of the complete book at no cost. Get it and read it.

Unfortunately, a tribute to Bill Niskanen's life and work is not complete without mentioning the controversy precipitated by his death. The Koch Brothers have been significant financial contributors to the Cato Institute over the years. Much of the good work of the Cato Institute over that time could not have been accomplished without their financial support. However, that financial support has not been without controversy and public friction between the Koch brothers and Cato Institute management.

To the delight of statists on the left and right, the conflict has erupted into a public fight for Bill Niskanen's controlling shares currently held by his estate. A legal and public relations war for the heart, soul, and control of the institute is underway. The Dividist will not attempt in this post to sort through the competing issues. The Koch Brothers case is linked here. The Cato Institute management case is linked here.

That said, if (as has been alleged) the Koch brother's actions are primarily motivated by a desire to make the Cato Institute a more effective tool to stop Barack Obama's reelection in 2012, then reconciling their actions with the public non-partisan divided government views of Bill Niskanen is problematical to say the least.

Of course, there is no telling for certain how Nikskanen would have felt about the upcoming election. But it is interesting to note that with the GOP a virtual lock to keep majority control of the House, and a very good chance of taking control of the Senate, the divided government vote in 2012 is a vote to re-elect Barack Obama.

Which scenario do you think Bill Niskanen would have seen as preferable in 2013? One Party Republican Rule under Mitt Romney? Or a divided government with Obama as president and the GOP in control of Congress? I suspect that Bill would ask - "Which scenario has more empirical historical evidence to support a more libertarian 2013?" The answer to that question is clear.

Divided and Balanced.™

Now that is fair.

The Doctrine of False Non-Equivalence - or - Why the left whining about "False Equivalence" is equivalent to the right whining about "Liberal Media Bias"

2012-04-04T15:56:00.000-07:00

It's all in the framing
image from [F]oxymoron

The President’s comments at the Associated Press luncheon on Tuesday received a great deal of media attention. Much of the punditocracy was focused on the President’s preemptive strike at the Supreme Court and apparent attempt to direct judicial decisions from the oval office. The political grandstanding by the President precipitated a grandstand volley between the judiciary and the DOJ, as well as predictable partisan posturing from both the right and left.

Frankly I am at a loss to understand what Obama hopes to gain from this kind of rhetoric. Sure it will fire up his base, but it also fires up the GOP base to a degree that the presumed Republican nominee could never hope to achieve. I also don’t see how it helps Obama with centrists and independents. When both a former mentor and student think he got it wrong, it is no surprise that his press secretary was on the defensive.

The President also tried to make hay with the oft-repeated point that the individual mandate was supported by Republicans before they were against it. Avik Roy and Ilya Somin point out the converse is also true, with many Democrats (including candidate Obama) opposing the individual mandate before they supported it.

We once again see partisan hackery, hypocrisy, and cynical opportunism from partisans and politicos on both the right and left. Nothing new there.

But is it true equivalent hypocrisy? Or is it false equivalence?

Which brings us to this response from the President during AP luncheon Q&A that did not merit quite so much media attention, but it got mine:

Question: "Republicans have been sharply critical of your budget ideas as well. What can you say to the Americans who just want both sides to stop fighting and get some work done on their behalf?"

President Obama: "I guess another way of thinking about this is -- and this bears on your reporting. I think that there is oftentimes the impulse to suggest that if the two parties are disagreeing, then they're equally at fault and the truth lies somewhere in the middle, and an equivalence is presented -- which reinforces I think people's cynicism about Washington generally. This is not one of those situations where there's an equivalence. I've got some of the most liberal Democrats in Congress who were prepared to make significant changes to entitlements that go against their political interests, and who said they were willing to do it. And we couldn't get a Republican to stand up and say, we'll raise some revenue, or even to suggest that we won't give more tax cuts to people who don't need them.. So as all of you are doing your reporting, I think it's important to remember that the positions I'm taking now on the budget and a host of other issues, if we had been having this discussion 20 years ago, or even 15 years ago, would have been considered squarely centrist positions. What's changed is the center of the Republican Party. And that’s certainly true with the budget."

Indeed. So the President thinks the press might be afflicted by an "impulse" to suggest that both Republicans and Democrats are at fault for failing to compromise on a budget bill. He goes on to patiently explain that is completely untrue - in fact that is "false equivalence" and bad reporting. The correct way for the Associated Press reporters to cover this story is to blame only Republicans. That should be obvious to everyone. Any questions?

I have a few. We've often heard this "false equivalence" complaint in recent years, but exactly what is the charge of "false equivalence" supposed to mean to a reporter on a practical level? Does it mean that the reporter should simply blame Republicans 100% for legislative failures at the behest of the administration? Or should the reporting be more nuanced than that? Should the reporter only slant the reporting to assign 75% blame to the Republicans and 25% to the Democrats? Or is it adequate to blame Republicans 52% and Democrats 48%? Who makes these fine judgments about whether there is false equivalence or true equivalence or some fine gradation of equivalence in a news story?

No problem. Democrats James Fallows and Greg Sargent are happy to tell you exactly who to blame and exactly what percentage to apply to Republicans.

This "false equivalence" meme and this speech are just another partisan attempt to shape the narrative, which is another way of saying - managing the press. Let's take a step back. In the early 2000's Professor George Lakoff, a Berkley cognitive linguist became a darling of progressive political thought. His ideas were embraced with an almost religious fervor on the left. To vastly (and unfairly) over-simplify his thesis: Lakoff asserted that the Democrats political misfortunes at the time were attributable to the fact that they let Republicans and Conservatives control the narrative and frame the issues. It was not the ideas, candidates or policies of the left that were being rejected at the polls. It was the way they talked about their policies. The problem was incorrect "framing" of how the issues were debated and discussed. It was just those darn words that they were using.

The subsequent conventional wisdom that evolved among Democrats and progressives was that if they simply use the right words - the correct "framing" - their ideas and policies would be broadly accepted by electorate at large. It's so obvious. If you start with the premise that progressives have a stranglehold on THE TRUTH, and if Americans are not being persuaded, then it should be obvious that THE TRUTH is just not being presented correctly. Progressives simply need the right "frame" to showcase their policy masterpieces and Americans will flock to admire their cause.

Meanwhile - on the other political wing: For years, even decades, Republicans have made political hay by accusing mainstream broadcast and print media of having a liberal bias. It is a de rigueur meme in virtually any GOP campaign that garners national attention. Every perceived criticism in the press can be deflected with that charge. Let's say you are a VP candidate who does not read books, does not know history, and has no real understanding of foreign policy? No problem. Liberal media and "gotcha questions" are to blame.

It is a popular and well mined meme. Best-selling books have been written about liberal bias in the media. Blogs are dedicated to monitoring and exposing liberal bias in the media. Conservative pundits bloviate about liberal bias in the media. The very raison d'etre for the Fox News Network was to provide a "fair and balanced" counterpoint to the perceived liberal bias in the media (which ironically spawned the current incarnation of MSNBC - apparently so conservatives could see what liberal bias in the media looks like when they really try).

"Liberal bias" is a cliche' but it is a politically effective cliche'. What does it mean when conservative politicians complains about "liberal media bias"? Simple. They don't like the way a story is being reported. They want the story reported the way a conservative perceives "THE TRUTH". If you can change the narrative int the press, or get your supporters to ignore a negative narrative in the press by charging "liberal media bias" - why not drag out that reliable chestnut? It's effective.

So lets get back to the left side of the political spectrum. What if you are a liberal Democratic candidate or operative and you also would like to influence the press to use a narrative more sympathetic to your cause? What if you'd like to undermine a competing conservative narrative in the press? What are you going to say? Are you going to accuse the press of "Conservative Media Bias"? Outside of Fox News, who is going to take that seriously? It's ineffective. No one believes it, not even liberals. But - a charge that media is reporting a "False Equivalence" between Republicans and Democrats - well - that sounds different and kind of intellectual and maybe that is a good reason to dismiss reporting insufficiently sympathetic to Democrats.

The charge of "False Equivalence" from the left is nothing more or less than political spin hoping to have the identical effect on perception of MSM reporting that the right seeks to achieve with "Liberal Media Bias."

The notion of charging the media with reporting "false equivalence" strikes me as absurd. Certainly there is media bias. There always has been and always will be. Sometimes it is left and sometimes it is right. It is not going to change because the right accuses the MSM of "liberal media bias" and it is not going to change because the left accuses the media of reporting "false equivalence".

This is politics as usual. I expect it from partisan Republicans. I expect it from partisan Democrats. But I do feel there is something unseemly and demeaning about the President of the United States stooping to this level.

But whether it is a president or a pundit, making the charge, I'll stick with the "Doctrine of False Non-Equivalence" which is to say....

They are equivalent. Deal with it.

UPDATED: Fixed typos. Cleaned up syntax. Added links.
Cross-posted at Donklephant