The Search for Political Truth

Most blogs include an “about me” post that sheds light on the writer’s personal background, why they chose their theme, etc. While I did cover some of what I hoped to accomplish in my “mission statement”, I did not get into my own story.  I’m sharing it here because the technology that allows me to blog also led me to opposing views, new people, great writers, clearly defined terms of debate, and ultimately, a new outlook.

Part One: A Young Democrat

I was born in 1961 and grew up on the far south side of Chicago. Our neighborhood, Beverly Hills, had the feel of a suburb and many mistakenly thought it was one. It was the tail end of the baby boom. My parents were Irish-Catholic Democrats. JFK was their political hero. The eighth of eleven kids, I was sure I was a Democrat too. My four older brothers were draft-age during the Vietnam war. It was an anti-war household. We were not wealthy-but we didn’t go hungry either. Education was a top priority and we went to great schools. We absolutely believed in the American Dream. The next generation would be better off, and if you worked hard you could accomplish anything you set your mind on.

I read the Chicago papers, mostly the Daily News because that’s what landed on the doorstep. Before long I read the paper for one reason: Mike Royko. I later followed him and shifted my allegiance to the Sun Times and lastly the Tribune. The seeds of cynicism were sewn. Chicago was ruled by Mayor Daley then, and his son now. It is easy to feel powerless as a voter. Machine politics and patronage armies make the wheels go around. Chicago is a fun and beautiful city in spite of this-not because of it. The next mayor will inherit a fiscal mess many years in the making.

As Watergate unfolded I became fascinated by politics. Richard Nixon was a perfect villain. I had a love / hate relationship with politics. I was a high school class president, and then lost interest as I came to view virtually all politicians as hypocrites.

Not much changed over the next many years. I alternated votes between Democrats and third party candidates. I didn’t “get” Reagan. He seemed old and odd. I believed all the negative press about him. His tax cuts were allegedly causing big deficits that would ruin our economy. There was “Iran Contra”.

I got my first apartment in 1982 and began a long career at the Chicago Board of Trade. There were parties, Cub games, beaches and girls to chase. Politics was for old, boring people. I considered myself “liberal”-as in open to change-but the Democrats didn’t seem to represent my views. I think many of my generation spent the 80’s and 90’s blissfully ignorant of politics. Elections provided poor candidates and lesser-of-two-evil choices. I was just as disgusted by “Slick Willy” as I was by “Tricky Dick”. Neither party had anything to offer me. Ross Perot was fun for a while and then he turned batty.

I stumbled onto Rush Limbaugh’s half-hour TV show in the early 90’s.  There was not much he had to say about Clinton that I disagreed with. The seeds were sewn. A long journey had begun and I didn’t even know it.

Part Two: Terms Defined

Our most commonly used political terminology is terribly flawed. “Liberal” is used as a blanket term to cover the left wing. They want bigger government, higher taxes, more spending, more regulation, redistribution of wealth, gay rights, affirmative action, abortion rights and gun control. They’re mostly anti-business, anti-capitalism, anti-free trade, anti-voucher, anti-death penalty and anti-war (no matter the circumstances). They hate the concept of free markets and seem unable to identify them at work. But this is almost exactly the opposite of what “classical liberalism” was all about. Read about it here: LINK

I’ve always considered myself open minded. “Conservative” sounds so stodgy. The dictionary defines it as “reluctant to accept change, in favor of preserving the status quo and traditional values and customs”-nothing about free markets or limited government. The Republican party needs to address this if they want to attract the youth of America. Young voters need to get informed because their future is being mortgaged to avoid political and fiscal responsibility today.

I use liberal and conservative in the way that they are commonly understood but I make a point to clarify where I stand-especially on free market principles. We don’t all neatly fit into two big tents but there is common ground to be had if we can clarify what free-market capitalism has done for this country.

I mostly agree with the Libertarian agenda-but as a party they are politically impotent. Their foreign policy view is naïve. Ron Paul is right about the Fed and seems to grasp economics better than most-but he has baggage, crackpot groupies and zero chance of winning at the national level.

The centrists and independents are a mixed bag. I don’t blame anyone for not wanting to hitch their wagon to either of our broken and corrupt major parties but you have to take a stand on important issues, get informed, get involved and vote. This is no time for apathy. If you are not part of the solution you are part of the problem. When polls are taken on serious issues and 14% declare they are “undecided” it can be mind boggling.

As for the parties, liberals want the big government described above and their Democrat politicians generally deliver. Free-market capitalists want small government-but instead we get Republican politicians like McCain and Bush who “reach across the aisle” and engage in constant compromise that leads to an ever-growing government and creeping socialism that is now accelerating.

Part Three: Transformation

In 2000 I discussed the election and politics with a conservative co-worker. I was open minded and he made sense. I was done with Democrats and knew Al Gore was an empty suit. I don’t like political dynasties yet I voted for Bush, my first Republican. I also bought my first personal computer that year. The PC was going to change my business and put me out of a job. I figured if you can’t beat ‘em, join ‘em. It was time to embrace the technology and reinvent myself. In November 2000 the firm I worked for was bought out. I left the trading floor behind and moved to Milwaukee.

I went to work for a firm that specialized in computerized trading. In my spare time I did research on the economic fundamentals and their impact on markets. My goal was to make money-this was not a politically motivated project. I traded some of the ideas for a proprietary account. This was a very different track for me. Success on the trading floor is driven by proximity to the action. Who you know and where you stand make all the difference. Understanding the order flow was key. That info was relayed to mostly New York based traders who did the fundamental thinking.  Sure there were traders in the pits who analyzed that info on the fly as it came across the news jets but most of us were too busy keeping our count or juggling phones to analyze things.

Off the floor was a different rhythm. I talked politics with the other traders. I was on the computer at work and at home. The internet brought me opposing views. The liberal bias in the mainstream media became apparent to me. I was angry when I discovered I’d been lied to for so many years-and yet I was energized by the new perspective it gave me. In a new town with extra time and the internet I read with renewed interest.

I learned that Reagan wrote his own speeches and studied economics looking for the best solutions. Jack Kemp and Arthur Laffer presented ideas that became the cornerstone of his economic policy. I read Rand, Hayek, Sowell and others; dozens of books; thousands of columns, both print and online. “Supply side” economics had worked. “Trickle down” was a pejorative used only by the left. Free-market capitalism had made the U.S. the most prosperous country on earth in it’s very short history. It is directly tied to all the freedoms we enjoy, and that some take for granted.

Economics is full of common sense, and when it’s presented by Thomas Sowell, Walter Williams or Milton Friedman it resonates. After reading their wisdom it was no longer possible to listen to disingenuous politicians blather on about myths like “Social Security trust funds”. It was impossible to digest this logic and hold the views I had for so long. I had become a free-market capitalist.

Part Four: A Post 9/11 World

On September 11th I was trading our firm’s positions in the 5-year note futures when planes hijacked by terrorists slammed into the World Trade Center and the Pentagon. Some of the brokers we dealt with on a daily basis were killed, incinerated and crushed in the rubble. The trading was frantic for a few hours and then everything shut down. Milwaukee was in no apparent danger and we stayed our full day. It was surreal. I went home to my lakefront apartment and looked at the gorgeous blue sky. I was homesick. I called friends and family and watched the news until I fell asleep. Things changed for me that day. Permanently. It bothers me that, for many, the outrage has faded away.

I wrote letters to the editor to counter the “blame America” liberals who cried, “why do they hate us?”-as if certainly we must have done something to deserve it. A mere 7 years later they would vote for Obama in droves resulting in the great apology tour and our extended and deep recession.

I followed the Bush presidency with great interest. Tax cuts would be used to spur an economy reeling from a burst tech bubble and 9/11. The Laffer Curve and supply side economics would be implemented-but once again these economic truths would be distorted by the accompanying spending increases and resulting deficits. Prescription Medicare expanded the entitlement programs. “Compassionate Conservatism” was nothing more than a watered-down version of big-government liberalism. The Afghanistan and Iraq wars are still hotly debated, and while I can acknowledge some solid arguments from the left here, I still support both wars-as long as we fight to win.

The end of the Bush presidency was as disastrous as McCain’s presidential campaign. Collapsing markets led to bailouts. The Republican party was damaged and capitalism declared dead. It was hard to accept but McCain as president with his misguided centrism might have made things worse. The sooner that the GOP realized they had veered off course the better.

Obama was in the right place at the right time with charisma and vague slogans for an uninformed electorate. The Democrats were celebrating and preparing for ”40 years” of political domination. I predicted the opposite. History was about to repeat itself. A “community organizer” with little political experience and socialist views paired with a congress led by left wing extremists would not deliver the solution to the economic mess we faced. The Democrats would blow it.

The midterm elections are the first confirmation that this view was / is correct. The economic policies he is pushing are poison. They did not work when FDR tried them-nor any time sense. Even Keynes is surely spinning in his grave and would be protesting the distortion of his views if he could. He felt 25% tax rates were the limit that the economy could bear.

The left is pushing us toward socialized medicine as it is failing in the UK and Canada. They are trying to increase government and the welfare state as it is collapsing in Greece and elsewhere. Public-sector unions have quietly increased power to the point that states are being bankrupted by pension obligations for a new privileged class that retires at age 50 to “double dip” with another government job.

How many voters regret falling for the Obama hype and backing him? How many who cheered the government’s “doing something” about health care will cry foul as they discover more and more of what Nancy Pelosi and her gang were hiding in that odious bill? Will people realize that there is a difference between emergency moves to prevent a sudden collapse of the banking and financial system and bailouts to the UAW while screwing the GM bond holders? Do they support the “DREAM” act because of its name? Do they want Iran to have nuclear weapons? Can they see that sanctions and talk don’t work. Do they realize that the START treaty is naïve and dangerous?

Part Five: What now?

In 2003 I went to a “Townhall meeting” where I was introduced to Americans for Prosperity. I am now involved to varying degrees with other organizations including the Illinois Policy Institute, the Heritage Foundation, and of course the Chicago Tea Party. I’ve been able to have great conversations with people I never thought I’d meet including Art Laffer, Steve Moore, Fred Barnes, Michael Medved, John Kass, Sen. Tom Coburn and UN Ambassador John Bolton. For anyone feeling that their voice is not heard and their vote doesn’t count-I assure you this will change your outlook.

If you read Sowell and Williams;  listen to Boortz, Rush, Don Wade and Mark Levin you get a clear sense of the battle within the US.

I check out left wing radio occasionally. Instead of looking for answers to what went wrong with the economy so we can avoid the same mistakes in the future they prefer the echo chamber and just blame everything on Bush. That so many believe a major crisis could be caused by dropping top tax rates from 39% to 35% is staggering. That so many think top rates of 70% or 90% are acceptable is frightening. I’ve heard callers rant that this is 30 years of Reaganomics collapsing on itself. The hosts cheer them on. One reason for starting this blog was to attempt to understand the liberal mindset through civil debate.

Reagan and others left the Democrat party. Obama, Reid and Pelosi will drive more away. The center is growing. If the GOP cannot heed the message of the tea parties and get back to basics a third party is likely to arise. Several states are facing imminent bankruptcy and the entitlement programs are over $100 TRILLION in deficit.  Already in Illinois, businesses are failing because money is owed them by the state.

Playwright David Mamet wrote a piece detailing why he is “no longer a brain dead liberal”.  LINK. He starts with a quotation attributed to the aforementioned John Maynard Keynes. The message is timeless, “When the facts change, I change my opinion. What do you do, sir?”

The Laffer Curve (LINK) is an economic truth: higher tax rates at this stage would be harmful to the economy. Bigger government = less freedom. The vitriol spewed toward the various tea party groups is proof that they are on the right track. The two-party system has led to this sorry state of affairs. Either one of the two big parties becomes the party of common sense or a true third party will likely emerge. There is zero chance of the Democrats abandoning their core views. The Republican party needs a thorough cleansing to get back to basics and there is no guarantee that the entrenched hoards will yield. It will take several more elections like the one we just had, and term limits, whether through legislation or the vigilance of the voters. We can no longer afford the luxury of being politically apathetic.

We commonly hear that if we don’t do something our children and grandchildren will pay the price. This is just another way to kick the can down the road. The cold reality is that if we don’t do something now, the markets will deliver swift punishment that will be felt by all of us. It is crucial that the leaders of this generation find the courage to speak the truth and confront the harsh realities before it is too late.

Facts are stubborn things.

Pat Duggan

Published in: on January 7, 2011 at 7:19 am  Comments (2)  

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2 CommentsLeave a comment

  1. Pat,

    Very well said. The fact that Republicans are bringing the Constitution to the forefront is a good thing. The long awaited transparency should also be good, but I’ll believe it when I see it. Ron Paul will expose the Fed, but the big banks still run the show. People need to go to jail for the housing mess, and unless they do it is a continuation of the scam.

  2. Pat,

    It was good seeing you the other day. I like the site of course being a RINO at heart I am more or less on the same page.

    Funny thing is…you grew up in an industry that has paved the way for what needs to happen in this country. That is nurturing smaller independent entities to take risk in transparent architectures with government consisting of efficient minimal (no your limitations) framework, regulation and policing. Unfortunately the industry you grew up in is loosing its way like so many others have in this country.

    Our forefathers and Andrew Jackson showed us the way. He kept this country from being swallowed up by a small number of banks and ruining everything our forefathers stood for. (He had other issues that did not shine so well but we can pick our spots when looking at history).

    We need to Jacksonize! We need to spread the wealth and minimize risk via transparent, fair and simple market mechanisms that let everyone have a shot. We need Ma and Pa banks to be banks and not try running the world.

    We need constitution litmus tests!

    Our children need to study 17th century Netherlands and latter 18th century America until they are blue in the face!

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