Lawyers Revolt

Say what you will about Pakistan, but their lawyers have some balls:

Police used tear gas and baton charges Monday to break up protests as thousands of lawyers took to the streets across Pakistan in the first significant demonstrations against President Pervez Musharraf's declaration of emergency rule on Saturday.

The largest rally took place in the eastern city of Lahore, where lawyers and police battled each other at the city's High Court complex. Several lawyers were injured, and hundreds were arrested before the protesters were dispersed.

Lawyers vowed to continue their protests in the coming days.

"We are determined that until there is freedom for the judges and the overturn of emergency rule, this war will continue," said Anwar Shaheen, a lawyer in Lahore. "They can't quiet us."

In suits and ties no less, as you can see from related pictures of the protests. In case you haven't been paying attention, about no lawyers in this country have all that eagerly swept into the streets to protest abuses of our Constitution over the last several years.

Not that it'll help much, but if you want to go tell President Bush that it's these people-not a dictator-who we ought to be supporting, you can here.

More on Pakistan

The latest from Pakistan:

Pakistan's government on Sunday executed a nationwide crackdown on the political opposition, the news media and the courts, one day after President Pervez Musharraf imposed emergency rule and suspended the constitution.

Police throughout the country raided the homes of opposition party leaders and activists, arresting at least 500. Top lawyers were also taken into custody, and 70 activists were detained at the offices of the Human Rights Commission of Pakistan in the eastern city of Lahore. Police confiscated the equipment of journalists covering the raid and ordered them to leave the premises. All independent television news stations remained off the air for a second straight day. The prime minister, meanwhile, said that elections could be delayed for up to a year.

As Nat-Wu said, this all sounds like what happened in Iran. Musharraf could lose his grip on power and Islamic extremists could take over, except while Iran is years away from having one, they'd have nuclear weapons.

Despite "outrage" from the White House over the crackdowns and promises by Secretary of State Condoleezza Rice to review our $150 million-a-month assistance program to Pakistan, our policy is not likely to change:

The Bush administration signaled Sunday that it would probably keep billions of dollars flowing to Pakistan’s military, despite the detention of human rights advocates and leaders of the political opposition by Gen. Pervez Musharraf, the country’s president.

Aside from the fact that this Faustian deal undermines the admin's message of democracy, the U.S. military aid we give isn't even helping our fight against Al Qaeda all that much:

Despite billions of dollars in U.S. military payments to Pakistan over the last six years, the paramilitary force leading the pursuit of Al Qaeda militants remains underfunded, poorly trained and overwhelmingly outgunned, U.S. military and intelligence officials said.

Pakistani President Pervez Musharraf cited the rising militant threat in declaring a state of emergency on Saturday and suspending the constitution.

ut rather than use the more than $7 billion in U.S. military aid to bolster its counter-terrorism capabilities, Pakistan has spent the bulk of it on heavy arms, aircraft and equipment that U.S. officials say are far more suited for conventional warfare with India, its regional rival.

That has left fighters with the paramilitary force, known as the Frontier Corps, equipped often with little more than "sandals and bolt-action rifles," said a senior Western military official in Islamabad, even as they face Al Qaeda and Taliban fighters equipped with assault rifles and grenade launchers.

The arms imbalance has contributed to Al Qaeda's ability to regroup in the border region, and reflects the competing priorities that were evident even before this weekend between two countries that are self-described allies in the "war on terrorism" but have sharply divergent national security interests.

The situation also has emerged as a significant obstacle as the United States and Pakistan seek new approaches after a series of failed strategies in the frontier region, where Osama bin Laden and other top Al Qaeda leaders are believed to be hiding.

More problems:

Plans to build up the Frontier Corps are not universally supported by U.S. military officials. Loyalties within the corps are thought by many observers to be divided. Members are recruited mainly from Pashtun tribes with long-standing mistrust of outsiders. Most reject militant ideology, and have suffered hundreds of casualties in the fighting. But many also are devoutly religious and feel some degree of sympathy for the Islamists' cause.

"There is a push-back among some that the Frontier Corps is not a reliable ally of the United States," said Seth Jones, a military expert at Rand Corp. "The concern is that you give them additional training and equipment, and they could end up helping militants rather than taking action against them."

Perhaps as a hedge against those concerns, the U.S. Special Operations Command has recently begun exploring efforts to pay off tribal militias in the region that are not affiliated with the Pakistani government, and arm them to root out Al Qaeda and Taliban militants, a source familiar with the discussions said.

"You can't buy them, but you can rent them," said the source, who spoke on condition of anonymity because of the sensitive nature of the discussions. "There is a very serious effort to look at this."

That's probably the best hope we have right now for anything good to come out of this.

UPDATE: Other Western countries are reconsidering aid. The Duch government just froze millions of dollars.

The folly of trying to impose democracy

The Washington Post has an article this week which cites a new study from two political science professors at the University of North Texas (where I am getting my BA in poli sci), Andrew Enterline and J. Michael Greig, that examines in detail 41 cases over about 200 years where one nation has tried to impose democracy on another. Their findings?

A third of all democracies imposed by one nation on another fail within the first 10 years of their establishment, Enterline and Greig found. Strong democracies, such as the ones set up in Germany and Japan, that last beyond 20 to 30 years seem to survive indefinitely.

But 75 percent of weak democracies, where elections are held but the civic institutions that shore up a democracy are weak or missing, die within the first 30 years. According to the definitions used by the political scientists, the democracy in Iraq, like others established by European colonial powers in Africa and Asia, is extremely weak.

"Their trajectory of failure deepens so that 90 percent have failed by their 60th year, and most have failed well before that," said Greig.

The two big success stories came after WWII with West Germany and Japan, of course, but they differ greatly from the situation in Iraq:

Those two success stories had all four of the ingredients that Enterline and Greig found make for successful impositions of democracy: large occupation forces early on to stamp out nascent insurgencies; a clear message that occupation forces were willing to spend years to make democracy work; an ethnically homogenous population, where politics was less likely to splinter along sectarian lines; and finally, the good fortune to have neighbors that also were democratically minded, or at least neighbors who could be kept from interfering.

Iraq, unfortunately, has none of the four ingredients.

"Trying to create a democracy in an ethnically diverse society is very dicey and historically very difficult, so to expect the opposite in Iraq runs counter to what has happened historically," Enterline said. "The initial plan was democracy in Iraq would radiate outward and democratize the Middle East, but if you place a democracy in the middle of authoritarian regimes, what we found is the democracy oftentimes fails and becomes like its neighbors."

The article goes on to say that imposed democracies that fail have even smaller chances of reestablishing democracy because, as Greig explains, "citizens learn that democratic institutions are not effective in dealing with the problems in their societies, so the society becomes less likely to push for democracy in the future."

Of course, a lot of people recognized this before we went to war. It's especially hard to look back now as see how anyone ever thought turning Iraq into a democratic oasis in the Mid East would be a cakewalk.

Democratic Pirates

This particular bit of pirate trivia from the October Atlantic Monthly seems appropriate as we wrap up International Talk Like A Pirate Day:

In the 18th century, Britain’s Royal Navy may have been defined by rum, sodomy, and the lash, but the sailors often thought that there was too little rum and way too much lash. According to a study by a George Mason University economist, the navy’s cruelty and authoritarianism drove sailors to join pirate ships—by 1716, the pirate population was one-fifth that of the British navy. The pirates devised a separation- of-powers system to ensure that their new captains treated them better. They elected a quartermaster from within their ranks to mete out provisions and booty, and captains got only an equal share. Common sailors could barge into a captain’s quarters, “swear at him, seize a part of his Victuals and Drink.” Only in battle did pirate captains wield total authority, allowing their crews to profit from the quick decisions a unitary executive could provide. The sailors, before setting out, would agree on guidelines—known as the “Custom of the Coast” or “Jamaica Discipline—for settling disputes, doling out punishment, and deciding living arrangements. (Some ships even had strict no-smoking policies.) The author notes that the separation of powers on pirate ships slightly predates England’s 1688 Glorious Revolution, and he suggests that the American system of checks and balances appears to have a little Captain Morgan in it.

Who knew we had the Founding Fathers and pirates to thank for our democracy?

Income Inequality

To no one's surpise, it's getting worse:

Lately economists have been using new data to look more closely within the top decile of American incomes. What they’ve found is startling. Here are some results from Ian Dew-Becker and Robert Gordon of Northwestern University. Between 1966 and 2001, median wage and salary income increased by just 11 percent, after inflation. Income at the 90th percentile (six minutes from the end of the hour-long parade) increased nearly six times as much—by 58 percent. At the 99th percentile (the last thirty-six seconds), the rise was 121 percent. At the 99.9th percentile (3.6 seconds before the end), it was 236 percent. And at the 99.99th percentile (0.36 seconds, representing the 13,000 highest-paid workers in the American economy), the rise was 617 percent. That is worth repeating: Over thirty-five years, the rise in wages and salaries in the wide middle of the income distribution was 11 percent. The rise in wages and salaries at the top of the income distribution was 617 percent.Such extreme skewness is new. It suggests that a huge proportion of the economy’s productivity gains are neither being passed on to consumers through lower prices—which would have the effect of raising real incomes very broadly—nor being distributed to investors as profit, nor even being used to raise the wages of most employees in industries seeing rapid productivity growth. Rather, they’re being diverted to a comparative handful of employees.

The author if this article contends that this is not a result of labor's declining share of national income, but not everyone agrees on that:

In another recent report on the boom in profits, economists at Goldman Sachs wrote, “The most important contributor to higher profit margins over the past five years has been a decline in labor’s share of national income.” ...For most of the last century, wages and productivity — the key measure of the economy’s efficiency — have risen together, increasing rapidly through the 1950’s and 60’s and far more slowly in the 1970’s and 80’s.But in recent years, the productivity gains have continued while the pay increases have not kept up. Worker productivity rose 16.6 percent from 2000 to 2005, while total compensation for the median worker rose 7.2 percent, according to Labor Department statistics analyzed by the Economic Policy Institute, a liberal research group. Benefits accounted for most of the increase.

Harold Meyerson at the Washington Post laments this trend:

The young may be understandably incredulous, but the Great Compression, as economists call it, was the single most important social fact in our country in the decades after World War II. From 1947 through 1973, American productivity rose by a whopping 104 percent, and median family income rose by the very same 104 percent. More Americans bought homes and new cars and sent their kids to college than ever before. In ways more difficult to quantify, the mass prosperity fostered a generosity of spirit: The civil rights revolution and the Marshall Plan both emanated from an America in which most people were imbued with a sense of economic security.That America is as dead as the dodo. Ours is the age of the Great Upward Redistribution.

So what's causing all this income redistribution? Here's Meyerson again, on globalization:

Clearly, globalization has weakened the power of workers and begun to erode the egalitarian policies of the New Deal and social democracy that characterized the advanced industrial world in the second half of the 20th century.For those who profit from this redistribution, there's something comforting in being able to attribute this shift to the vast, impersonal forces of globalization. The stagnant incomes of most Americans can be depicted as the inevitable outcome of events over which we have no control, like the shifting of tectonic plates.Problem is, the declining power of the American workforce antedates the integration of China and India into the global labor pool by several decades. Since 1973 productivity gains have outpaced median family income by 3 to 1. Clearly, the war of American employers on unions, which began around that time, is also substantially responsible for the decoupling of increased corporate revenue from employees' paychecks.

So globalization has helped to depress wages, but it's not the sole explanation. Here's a more general explanation, from a researcher at the afore-mention Economic Policy Institute:

“If I had to sum it up,” said Jared Bernstein, a senior economist at the institute, “it comes down to bargaining power and the lack of ability of many in the work force to claim their fair share of growth.”

But why the lack? Unions are clearly no longer as powerful as they once were. Could that be part of the reason?

Researchers argue union weakness is due to the spread of skill-based technology jobs. Unions have the greatest appeal when workers are equally skilled; technology skills destroy that equality. Consequently, it becomes less profitable to join a union. Also, increased political and managerial opposition to unions has played a role.Due to the declining power of unions, the increasing productivity of skilled workers has not raised the incomes of their less skilled counterparts, as it once did through labor contracts.

What about technological change?

Computers and the internet have reduced the demand for routine jobs that demand only moderate skills, such as the work of bank clerks, while increasing the productivity of the highest-skilled. Studies in Britain and Germany as well as America show that the pace of job growth since the early 1990s has been slower in occupations that are easy to computerise. But the scale of America's income concentration at the top, and the fact that no other country has seen such extreme shifts, has sent people searching for other causes. The typical American chief executive now earns 300 times the average wage, up tenfold from the 1970s. Continental Europe's bosses have seen nothing similar. This discrepancy has fostered the “fat cat” theory of inequality: greedy businessmen sanction huge salaries for each other at the expense of shareholders.

So technology is part of it, but can hardly explain all of it. What if add immigration in the mix? From a study of income inequality in California by the Public Policy Institute of California (pdf):

Immigration contributed to rising income inequality in the state because the proportion of immigrants in the state's male workforce has grown substantially and has grown most at the bottom and lower-middle of the income distribution.

That only makes sense. If you add enough lower-paid workers to the mix, you'll reduce average income. So economic and social trends are clearly at work. But what about political trends? Paul Krugman thinks it has a lot do with who's in charge in Washington:

Finally, since 1980 the U.S. political scene has been dominated by a conservative movement firmly committed to the view that what's good for the rich is good for America. Sure enough, the rich have seen their incomes soar, while working Americans have seen few if any gains....it seems likely that government policies have played a big role in America's growing economic polarization -- not just easily measured policies like tax rates for the rich and the level of the minimum wage, but things like the shift in Labor Department policy from protection of worker rights to tacit support for union-busting.

I think Krugman is trying to avoid being too partisan, because it's clear that government policy can have a profound effect on income inequality. Let's start with those Bush tax cuts:

As it happens, Citizens for Tax Justice, a national think tank, just completed a study of the latest federal tax cuts. The study analyzed the benefits generated by these tax cuts vs. the national debt incurred to finance them, as well as the ultimate distribution of the final net benefits and costs across, horror of horrors, different income classes. The findings are thought-provoking. According to the study, 99 percent of Illinois families are net losers under these debt-financed tax cuts. Only the wealthiest 1 percent of Illinoisans -- folks with an average annual income of $1.44 million -- come out ahead.

It helps to have numbers to back it up, but it's common-sense that if you give more money back to the wealthy, thus increasing their share of income, then you're going to widen the gap between them and the poor and the middle-class, who get far less or nothing at all back from the tax cuts. "Starving the beast" also result in less public services to those with lower incomes (no, the tax cuts don't pay for themselves) furthering income inequality. Then there's the minimum wage, which as a result of the failure of Congress to increase it for ten years now, has declined in real purchasing power:

One way the United States addresses inequality is through the federal minimum wage. In 2005, minimum wage workers earned only 32% of the average hourly wage. Barring a minimum wage increase, we are poised to break a record in 2006 for the greatest inequality between minimum wage and average wage workers since the end of World War II.

So which party has been in charge for those ten years, and has deliberately stifled any effort to increase the minimum wage? (That's a rhetorical question.) This goes hand in hand with efforts to alter regulatory requirements for overtime pay that would reduce the take-home pay of millions of workers. And while the power of unions have weakened for reasons that have little to do with whose in office, without question Republicans continue to push changes that would weaken them still further.Lax governmental regulation of corporations as a result of Republican policies has also contributed to rising income inequality:

A clear example of such manipulation are the banking scandals of the 1980's. Under this scheme, the government implemented a deregulation plan which permitted banking institutions to offer unreasonably high interest rates to investors. These investors were overwhelmingly wealthy interests who purchased "brokered accounts" under the $100,000 federal insurance limit. The agency responsible for monitoring the investments of these institutions, the Federal Deposit Regulatory Commission, was understaffed and there was political interference with their activities. When numerous institutions failed, the government "bailed out" the many wealthy depositors. The total cost of the bailout according to a recent Federal Reserve report was $153 billion. The net result is a shift of this money from ordinary taxpayers to wealthy investors.

That's not even the most recent corporate scandal. Let's not forget the shenanigans of the likes of Ken Lay...or how some other corporate CEO's have managed to amass such hefty paychecks as a result of lax governmental regulation. Then there are the little ways that the current administration wants to make things a little easier on "the have-mores", such as making it a lot harder to collect taxes from wealthy tax cheats:

The federal government is moving to eliminate the jobs of nearly half of the lawyers at the Internal Revenue Service who audit tax returns of some of the wealthiest Americans, specifically those who are subject to gift and estate taxes when they transfer parts of their fortunes to their children and others. The administration plans to cut the jobs of 157 of the agency’s 345 estate tax lawyers, plus 17 support personnel, in less than 70 days. Kevin Brown, an IRS deputy commissioner, confirmed the cuts after The New York Times was given internal documents by people inside the IRS who oppose them.

You can pass all the laws in the world, but if you don't have enough police to enforce them, who's going to obey them, right? Which in this situation, is exactly the point.

This is at the same time that the administration is going to send debt collectors after poorer tax cheats, at greater expense than what it would cost to have the IRS' own agents do the job (a shining example of both Republican tax policy and the failure of privatization.)So...what have we learned? Income inequality can be the result of entirely natural economic and social trends. But at the root of income inequality lies human nature, and the simple fact that people who acquire wealth want to use their wealth to acquire still more wealth. If left to their own devices, they'll acquire as much as they can given the particular political circumstances; at the same time though, the wealthy will also use (or corrupt) the political process to make it easier to acquire more wealth (pdf). So why is this a problem? Back to The Economist:

Privately, some policymakers admit that the recent trends have them worried, and not just because of the congressional elections in November. The statistics suggest that the economic boom may fade. Americans still head to the shops with gusto, but it is falling savings rates and rising debts (made possible by high house prices), not real income growth, that keep their wallets open. A bust of some kind could lead to widespread political disaffection. Eventually, the country's social fabric could stretch. “If things carry on like this for long enough,” muses one insider, “we are going to end up like Brazil”—a country notorious for the concentration of its income and wealth.

The authors of this particular study say that generally, democracy has a negative effect on income inequality...but that reverse is true as well (pdf):

A skewed income distribution, in turn, could lead to a skewed distribution of political power, which negates democracy and therefore its effect on inequality.

In other words, income inequality tends to perpetuate itself, and it could potentially be a threat to our democratic system. Income inequality in some fashion is inevitible, and not necessarily undesirable. But severe income inequality that produces a permanent underclass of poor and reduces upwardly mobile opportunity is not only unjust, but a danger to American democracy. The consequences of current economic trends and political policy may be hard to visualize, as they may be some decades distant, but were things to continue unchanged it's not that hard to imagine a country where the wealthy enjoy a sytem of privileges entirely different from what the rest of us enjoy, aided and abetted by those in power who are like them or who serve them. What will that country look like and what will remain of the way of life that we've come to value as uniquely American? I for one would rather not find out.

Update: It's a little worse than we thought (via Kevin Drum.)