Category: Vietnam War

The “As If” Pandemic War

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December 1, 2023

by Stephen Stofka

Last week I mentioned that the pandemic simulated conditions similar to a large scale war. This week’s letter explores those war-like aspects, the personal behavior and public policy choices that promoted inflation. Economists measure indicators of supply and demand to gauge the human emotion and calculation that guides decision making. Supply and demand are discernible but inseparable, a synergy of planning, emotion and reaction. Wars and global pandemics transform the routine of our daily lives into a natural experiment to help us better understand the dynamics of our daily choices.

As inflation increased in 2022, economists fell into several camps. There were those who thought the inflation was due to supply bottlenecks and that it would resolve itself. Some thought that the government had provided too much stimulus and the excess demand fueled inflation. Others thought that it was a combination of the two – both supply and demand. Some thought the Fed had waited too long before recognizing and responding to the problem of rising prices. The public sometimes gets frustrated with the arguments of prominent economists who help shape public policy.

Economists gather a lot of data and develop causal models to construct scenarios of future events. People do not respond to events like automatons. People try to anticipate what’s coming and change our behavior before anything has happened. From several blocks away I can see that the light is green but it is unlikely to be green when I get to the intersection at the speed I am going. I can either accelerate quickly or ease up in anticipation of making a full stop at the light. I am not responding to the state of the world as it is but as I predict it will be. The philosopher Ludwig Wittgenstein (1889 – 1951) wrote that the future could not be inferred from the present. What if I speed up to beat the light and a driver swerves onto the road? At the same time I am making my decision to speed up, a pedestrian might think it is safe to cross the road. It is a minor tragedy in the making. What doesn’t happen is as much the reality of the moment as what does happen, Wittgenstein claimed. As economists try to predict human behavior, the subjects being studied are also trying to predict the behavior of the people and events around them.

During the pandemic, the global supply chain exhibited bottlenecks that would be more likely during a large scale war. A critical strategy during war is to disable or destroy the enemy’s supply lines. Factories, roads, railways and airports are bombed. The initial response to the pandemic was to shut down much of the global manufacturing capacity. The transportation networks were not destroyed but disrupted. For months shipping containers sat on ocean ships outside the port of Los Angeles in California. The ships could not return empty to factories in Asia and load up with more shipping containers. The conveyer belt of the global supply chain had stopped. To get critical supplies, U.S. companies hired planes to fly goods from Asian ports.

In January 2022, several economists at the New York branch of the Federal Reserve published a GSCPI composite index that estimates the price pressures in the global supply chain. You can read about their methodology here. In December 2021, the index measured a stress level that was so rare – less than four out of a million chance of occurring. In March the NY Fed estimated that global supply pressures had eased a bit but May’s report indicated worsening pressures. A month earlier the Fed had started a series of interest rate increases to curb inflation.

During a war, civilians alter their buying habits. Governments impose travel restrictions and curfews on the civilian population. Some goods are diverted to armaments. The armed forces requisitions certain foods for the soldiers fighting the war. During the pandemic, house-bound people bought household appliances and furniture, computers and entertainment devices. These are “core” goods that people buy infrequently so suppliers were likely to have a supply in stock. Stores could not restock and shelves were often bare. Where were the goods? Sitting in a container on a ship in the Pacific. By early 2021, Covid-19 vaccines were made available to seniors and others deemed vulnerable. By late 2021, restrictions on personal services like hair salons and restaurants were eased. By early 2022, a world that had gone stir crazy for two years visited restaurants, booked vacations, joined gyms and had their hair done. The household goods and appliances that stores had ordered now arrived but the public had switched their buying habits.

Many Americans had never experienced wartime restrictions and resented the heavy hand of government in their daily lives. Many states closed schools and day care facilities, leaving parents with round the clock care of their children. Some of us are content to be alone while others thrive on the company of others. As people re-emerged into normal public life, some rebelled against institutional rules of any sort. A request from a flight attendant on an airplane might incite a violent reaction from a passenger who regarded the flight attendant as representative of all institutional authority. Some passengers responded as if they were escaping from prison. They verbally attacked employees working in airlines, in restaurants and grocery stores, in hair salons and other public facing businesses. Here is a compilation of confrontations between passengers and airline employees. In the public square and on social media, we were acting as though we were at war with each other.

There are often social frictions following a war. The passage of the Prohibition amendment following World War I disrupted social relations in America. Some states and cities imposed restrictions to curtail the spread of the so-called Spanish flu (see note below). The drop in crop prices following the war put many farmers and regional banks out of business during the severe recession of 1920-21. Americans turned against other Americans, particularly minorities who enjoyed any good fortune. A prosperous Black community in Oklahoma was burned to the ground. Americans of British and northern European heritage pressed lawmakers for new immigration rules that would restrict anyone but northern Europeans from legal entry into the U.S. In 1924 Congress passed the Johnson-Reed Act that imposed country quotas favoring those from northern European countries at the expense of southern Europeans and Asians.

During World War 2, Americans were at war with Japanese, Italian and German Americans in the barracks and in the public square. A 1942 musical featured a song The House I Live In to promote a camaraderie among the public. In 1945 the popular singer Frank Sinatra starred in a short movie of the same name to combat prejudicial attitudes toward minorities. In the year after the war ended, the marriage rate hit an all-time high but the divorce rate also spiked.

During the 1960s and 1970s the Vietnam War provoked social and political hostilities among Americans. The conflict erupted on public streets, on college campuses and in households where children and parents debated the ethics of the war. To a growing coalition of Americans returning vets represented the barbarous atrocities that the country’s leadership had ordered. They were treated with scorn or disregard by a public that wanted to forget the war. Many were betrayed by the bureaucratic red tape that kept many waiting for benefits that the government had promised in return for their service. See 2: 45 on this 5 minute clip from the History Channel. How does rude and antagonistic behavior affect inflation?

The rudeness, the lack of kindness in social relations stirs a deep sense of dissatisfaction within us. The circumstances of the pandemic aroused feelings of vulnerability and anger. The antidote to dissatisfaction is satisfaction. The antidote to powerlessness is the exercise of power. Spending money on ourselves and our family promotes a sense of satisfaction and power – just what the doctor ordered. Newly escaped from pandemic prison consumers increased their credit card balances by an average of 15% annualized in 2022 and 17% in the first half of this year. Over a ten-year period, consumers increased their credit card balances by 4% each year, slightly more than the 3.65% average of all consumer debt. As they did after WW2, Americans put the pandemic crisis behind them by us by spending.

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Photo by Shalom de León on Unsplash

Keywords: World War 1, World War 2, Vietnam War, curfews, consumer spending, credit card debt

Note on Spanish flu:  The U.S., Britain and other allies suppressed news of the flu spreading among their troops. Spain did not impose wartime restrictions on publication of the news so the public first became aware of it from Spanish newspapers. Later genetic testing and historical records indicated that the origin of the world wide pandemic was an Army base in Leavenworth, Kansas.

The Tools of Peace and Power

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September 12, 2021

by Steve Stofka

The recent exit from Afghanistan after a twenty year war (2001-2021) reminds me of the twenty year war we fought in Vietnam (1955-1975). Neither war achieved our ends, demonstrating again that war is a series of miscalculations of the gains and costs. Our overwhelming fighting force can dominate short-term conflict like the Gulf War but it is not a winning strategy against poorly funded insurgent groups.  To those who study the practice of war, this dichotomy prompts many pages of speculation as to the causes.

An answer that fits the facts is that a dominant force like the U.S. does not go to war to win, so it achieves its goal by not winning. The traditional end of war – a win – is to capture territory or access to resources within a region. In Vietnam and in Afghanistan, the U.S. had no such designs. Its goal was remove an existing regime and to prevent its return to power. The first is a military goal. The second is a political end. In both countries, we achieved the military goal of removal. In both countries, we learned that armed troops cannot achieve a long term political goal. Why didn’t we learn our lesson after Vietnam?

An answer that fits the facts is that our goal is to demonstrate our military power, not to learn lessons. In 1795, shortly after the final ratification of the U.S. Constitution, the philosopher Immanuel Kant wrote Perpetual Peace, an essay arguing that a republican government, one with a separation of legislative and executive powers like the U.S., was the only hope of perpetual peace. Without a central authority over all the nations, the only constraint on leaders must come from within each nation.

Only those under a republican form of government understood the true costs of war. The citizens had to fight it, fund it and repair the country after the war was over. 200 years later, the development of technology has allowed most Americans to vote for war without fighting it. The U.S. spends over $536,000 per person in the armed forces, more than five times what China spends per active duty person (GFP, 2021). Because we are able to borrow from the rest of the world, we don’t have to fund our wars with our own taxes. Lastly, the wars are fought in another country so that we don’t have to repair the damages of war. The horrific attack on the World Trade Center twenty years ago was a visceral, deeply wounding reminder of the cost of war fought on the homeland.

Kant wrote that a treaty of peace could not solve the tendency of nations to find a justification for war because a treaty ended only one war. Since peace was not a natural feature of human societies, countries should try to construct a peace that ended all wars. He suggested a League of Peace and stressed that it be a federation of nations, not a nation of nations. The League of Nations formed after WW1 constructed only a treaty, not a peace. Intent on punishing Germany for the war, the Treaty of Versailles ensured the next war twenty years later. The United Nations and NATO were two attempts to form international organizations aimed at resolving issues without war. We have not had another world war since the mid-20th century but we have not constructed a durable peace either.

America has overcome Kant’s three safeguards against perpetual war. Writing at the end of the 18th century when nations fought to take something from someone else, Kant could not imagine our present circumstances. We fight wars to give something to other peoples, a chance for freedom and hope. That is our justification for the damage we do. But the end of war is to take what we want, not to give. We have built the most formidable fighting machine that has ever existed, but it is a tool of power, not peace. In memory of those who died that day 20 years ago, let’s invest in the tools of peace.

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Notes:

Photo by Stephen Johnson on Unsplash

GFP. 2021. “2021 Military Strength Ranking.” Global Firepower – World Military Strength. https://www.globalfirepower.com/countries-listing.php (September 11, 2021). Note: dividing total military cost by active personnel: US $536K per person, Russia – $48K, China – $108K, India – $44K, Japan – $198K, S. Korea – $76K.

Kant, Immanuel. 1983. Perpetual Peace, and Other Essays: On Politics, History, and Morals. Indianapolis, IN: Hackett.

National Constitution Center (NCC). 2021. “On This Day: Congress Officially Creates the U.S. Army.” National Constitution Center – constitutioncenter.org. https://constitutioncenter.org/blog/on-this-day-congress-officially-creates-the-u-s-army (September 11, 2021).

What’s In the Mirror

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November 8, 2020

by Steve Stofka

Every hour of the day, Mr. Trump issues a barrage of tweets about massive voter fraud. No evidence. He began his four-year term with the ridiculous claim that he had larger inauguration crowds than former President Obama. The overhead photos clearly showed that not to be the case. He claimed the photos were doctored.

Some families are unfortunate to have a crazy uncle that no one wants to invite for Thanksgiving. Mr. Trump is our crazy uncle President. Chris Christie, his former campaign and transition manager in 2016, has challenged the President to show the evidence.  There is none. There are a few isolated irregularities as always but no evidence of massive voter fraud.

I grew up a few miles from our wonder boy President. In our neighborhood, his whining and sniveling would have earned him a “put on your big boy pants, peckerhead.” He never had big boy pants, because his daddy kept him in diapers, buying him whatever he wanted, covering up for his stupidity and recklessness. 

Where I grew up you learned to fight your own battles. Our daddies didn’t coddle us. We didn’t have an army of lawyers to protect us, or doctors to get us out of the draft. We didn’t have the money to buy women. We had to earn our own way.

During the Cold War years, Americans trained their paranoia on the Communists. They were everywhere in America. At mid-century, people lost their jobs and had their careers cut short in a Republican witch hunt to rout out the Communists. Whenever Republicans want to rouse up their base, they complain of Socialists and Communists trying to take over the country. From the 20th Century playbook the older people are passing on their hate and paranoia to their kids who will carry on the tradition through this century.

Our culture thrives on conflict, and our media and politics profits from turbulence. Like our judicial system, we have an adversarial political system. Competition rather than cooperation is the default strategy. Both sides of an issue try to obscure rather than clarify issues. Our conflicts become our entertainment.

During the First Battle of Manassas in July 1861, congressmen and wealthy families from Washington picnicked at an observation point while young men slaughtered each other. They didn’t have TV then. Their picnic turned to panic when they were caught in the rout and retreat of Union soldiers.

America is a congregation of the world’s refugees. Persecuted or disadvantaged in their home country, many of our ancestors came to America to create a space for themselves. They brought their hopes and their hatreds. The first civil war was the American Revolution, when thousands of colonial citizens fled to Canada to avoid death at the hands of their countrymen.

In the 19th century immigrants from other European nations came streaming in through the ports and borders of America. Thousands of Irish farmers fled during the potato famine in their country at the mid-century. Chinese workers helped build the railroads during and after the Civil War. Shortly thereafter, in 1882, they became the first nationality to be excluded.

Expanding industrial businesses in America needed workers at dirt cheap wages. America opened the door to Europeans from north and south. They carried with them their hopes of a better life and decades or centuries of prejudices they had been taught since childhood.

One of those was a German young man fleeing obligatory military service. He was Donald Trump’s grandfather, Friedrich Trump (Frost, 2018). His son and grandson, our President, would disavow their German heritage in later years. Like his grandfather, Donald Trump evaded military service when his daddy paid a doctor to falsify medical records. Some traditions are important in the Trump family.

After World War I, America closed its borders to all but a few European nations. Antipathy to Germans ran high after the war. Returning servicemen still clung to their belief that the only good German was a dead German. Still, the nation was not among the excluded countries in the immigration act of 1924.

In 1965, a new immigration act reopened borders; now refugees from Asia and Latin American countries came to America. Like the Europeans, they brought their peculiar prejudices and a centuries long history of slaughter and civil war.

This country is founded on hope, prejudice, and tolerance. People of other nations have despised their neighbors because of religion, culture, ancestry, and history. America is the melting pot of that ugliness brought here by people from around the world. The torch held aloft at the top of the Statue of Liberty burns bright with the starshine of our ideals and the burnt cinders of our hatreds. People in other countries look to America and the millions of guns stashed in homes throughout our country; they wonder how is anyone still alive in America? If we can tolerate each other, there is hope for the rest of the world.

We are a tolerant people, civilized savages in a nation of laws. We go to church on Sunday and throw rocks at 6-year old Ruby Bridges, a black girl walking to school (Hilbert College, n.d.). That was sixty years ago this coming week. We pour out our sympathies and open our pocketbooks to help those whose lives have been torn apart by disasters around the world. We swear on our bibles, then tuck them away, pick up our torches and light Vietnamese children on fire. Love, charity and the darkness within.

Mr. Trump tapped into the power of our hatred and will continue to be a force in American politics. With millions of Americans following his Twitter feed, he delights in the conspiracies that feed the flames of righteous anger and justified hatred. As Pogo said, we have met the enemy and he is us.  

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Photo by Erik Eastman on Unsplash

Frost, N. (2018, July 13). The Trump Family’s Immigrant Story. Retrieved November 08, 2020, from https://www.history.com/news/donald-trump-father-mother-ancestry

Hilbert College. (n.d.). Social Justice Activists: Ruby Bridges. Retrieved November 08, 2020, from https://www.hilbert.edu/social-justice-activists/ruby-bridges

The Best in History

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March 29, 2020

by Steve Stofka

The financial crisis a decade ago prepared us to better handle this historic pandemic. Gambling by financial companies, fraud and foolishness sparked that crisis. It had a large impact on the economy and the lives of millions of Americans who lost their homes, savings and jobs. It did not shut down the entire economy.

The Federal Reserve has enacted many emergency measures to support the money market and bond market during the current crisis. Many were set up under the leadership of former Chairman Ben Bernanke in response to the last crisis. In the last crisis, heavy Republican opposition delayed or blocked bailout measures. Republicans whipped up that political sentiment and won back the House in 2010. At a Tea Party rally against Obamacare, one old geezer complained that people used to just go home and die. What does he think now about the pandemic? Should the hospitals turn away all those people? The Tea Party is largely inactive now. Former Congressman Dick Armey helped spark the movement, the Koch Brothers funded it, and the Republican Party rode the wave. In the House, a coalition of about thirty members call themselves the Freedom Caucus (DeSilver, 2015). They are the remnant of the Tea Party movement.

During his campaign, candidate Donald Trump was criticized for his support of the relief policies during the financial crisis (Sherman, 2015). In a recent NBC / Wall Street Journal poll, Republican voters gave President Trump a 92% job approval rating. Overall, the public gives him about 50% on his handling of the coronavirus crisis (POS, 2020).  As a presidential candidate in 2016, Mr. Trump famously joked / bragged that he could shoot somebody on fifth Avenue in Manhattan and get away with it (Diamond, 2016). Have his policies contributed to the deaths of New Yorkers during this crisis? Depends on which political glasses you wear.

55 years ago, many Democrats defended President Johnson who sent hundreds of thousands of Democratic and Republican sons to be slaughtered in the swamps of Vietnam. Communism was the virus then. It infected the young and turned them into anti-American socialists. The only remedy was to send the young to another country or beat them with batons at anti-war rallies in Chicago, Washington, and New York City. In the first years of the war, fathers and mothers blamed Communism not President Johnson for the death of their sons. My Lai was the most famous of many atrocities committed during that war (Levesque, 2018). Shortly after that tragedy in March 1968, Mr. Johnson abandoned his re-election bid. Was Mr. Johnson a monster or a hero? Depends on which political glasses you wear.

President Trump is a singular brand but was undoubtedly influenced by the culture of fear and hate that marked his formative years. He wears his hate like a favorite shirt. Like so many, he’s a “used to be”, a former Democrat turned Republican. On C-SPAN’s Washington Journal daily call in program, there’s at least one person who says, “I used to be.” Fill in the blank – either a Democrat or a Republican. They have donned a different shade of glass.

“I’m a this-ism” is another pandemic sweeping the nation. People no longer act in support of their beliefs. Christians declare that they are Christian. They don’t need to act with generosity to others. Progressives declare that they are progressives but don’t have time to vote. That lack of support in the voting booth has hurt the Sanders campaign. He often reminds his supporters that they need to show their enthusiasm at the ballot box. I don’t often hear liberals declare themselves as such. They might be socially liberal but fiscally conservative. Neo-liberals never declare themselves but there are a lot of them, from what I hear. Politicians who have the least restraint in their behavior declare that they are Conservative. Really?

Mr. Trump is the King of Declarations. He’s the greatest President with the greatest policies and his administration is handling this crisis better than any other country. As some people take their last breaths in an emergency room, they are thinking exactly that. This administration is handling this crisis better than anyone in history. How will President Trump’s leadership during this crisis be judged? That will depend on which glasses you wear. Remember, you can trade in for another color of glasses.

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Notes:

DeSilver, D. (2015, October 20). House Freedom Caucus: What is it, and who’s in it? Retrieved from https://www.pewresearch.org/fact-tank/2015/10/20/house-freedom-caucus-what-is-it-and-whos-in-it/

Diamond, J. (2016, January 24). Donald Trump could ‘shoot somebody and not lose voters’ – CNNPolitics. Retrieved from https://www.cnn.com/2016/01/23/politics/donald-trump-shoot-somebody-support/index.html

Levesque, C. J. (2018, March 16). The Truth Behind My Lai. NY Times. Retrieved from https://www.nytimes.com/2018/03/16/opinion/the-truth-behind-my-lai.html

Photo by Giorgio Trovato on Unsplash

Public Opinion Strategies (POS). (2020, March 26). Coronavirus National Polling (March 26th). Retrieved from https://pos.org/coronavirus-national-polling-march-26th/

Sherman, A. (2015, September 15). PolitiFact – Did Donald Trump support the Wall Street bailout as anti-tax Club for Growth says? Retrieved from https://www.politifact.com/factchecks/2015/sep/15/club-growth/did-donald-trump-support-wall-street-bailout-club-/