The editors of Bloomberg remark on President Biden’s budget. In general they support it but they find a few defects:

The plan is right to raise taxes more than spending — enough to curb borrowing and stabilize the ratio of debt to gross domestic product at 106% by 2029. That’s much better than the current baseline, which shows debt rising from 99% of GDP this year to 117% by 2034, with more to follow.

Yet the budget’s forecasts optimistically assume strong and steady growth over the coming decade. A downturn would drive debt higher. Starting out with a ratio pinned at well more than 100% of GDP — the highest since just after World War II — leaves no space for emergency fiscal expansion. When the economy is at full employment and growing well, public debt should be falling.

and the numbers don’t add up:

First, after 2025, many of the measures included in the Tax Cuts and Jobs Act of 2017 will expire. Biden’s plan relies on the revenue that would result despite promising (no details) to extend the law’s changes for people making less than $400,000 a year. In effect, that hides a shortfall of $1.4 trillion. Second, Social Security is heading for insolvency in 2033. The budget promises to prevent this, but doesn’t say how — another big fiscal hole.

I thought these were their central observations:

Unrealized capital gains should be taxed at death, not erased by so-called step-up basis. Carried interest should be taxed like ordinary income. But smart reforms like this can’t do the heavy lifting. With households making less than $400,000 excluded, the biggest hauls come from taxing profits at 28% instead of 21% and from sharply higher taxes on the rich.

This strategy is questionable. Recent evidence suggests that former President Donald Trump’s corporate tax cuts spurred investment; over time, that means faster growth. And by international standards, the US personal tax code is already progressive. (Europe’s governments, having tested the limits of income taxes, rely heavily on broadly based consumption taxes to pay for their more expansive spending programs.) New taxes that fall heavily on capital formation and boost the rewards for tax avoidance are likely to hurt the economy and raise less money than the administration’s planners think.

They also don’t mention that public debt overhang tends to reduce GDP growth, something demonstrated empirically. Increasing public debt while relying on growth for solvency is a non sequitur.

The editors of Bloomberg are generally supportive of the president.

I wanted to call attention to just two sentences in the editors’ of the Wall Street Journal’ remarks on Sen. Schumer’s and President Biden’s recent statements on Israel. First is this:

The joke around Jerusalem is that while Mr. Biden once worked to help Israel after Oct. 7, he’s now working on the “two-state solution”: Michigan and Nevada.

That comports pretty closely with my earlier observation: Sen. Schumer and President Biden are doing damage control, trying to avoid losing Jewish votes and Arab votes. I wish them luck. I don’t believe there is any way of threading that needle.

Here are the other two sentence:

To leave Hamas in power in Rafah is to lose the war, and to replace Hamas with Fatah is to lose the peace. That’s an Israeli consensus, not “Bibi.”

which comports with my observation yesterday that Sen. Schumer and President Biden are imagining an Israel that does not exist. That they are also imagining Palestinians who don’t exist doesn’t compensate for that. It actually makes it worse.

I think that Donald Trump is a loose cannon who says things for shock value, to rile people up, and to get headlines. I don’t think he’s temperamentally suited for the presidency.

I also think that importing Chinese EVs will be hard on the domestic auto industry. I have problems with importing any product from any country that has received massive state subsidies.

What do you think of Sen. Bernie Sanders’s proposal for a 32 hour work week (at the same pay). Sounds like he’s going after the Generation Z vote to me.

Tomorrow I plan to vote in the Illinois Democratic primary. The Cook County Democratic Party helpfully sent me a handout which I plan to take to the polls with me. It shows me exactly who I won’t vote for.

I wanted to make some observation on Senate Majority Leader Chuck Schumer’s recent speech on Israel. The full text of it is here, made available by the Times of Israel.

My immediate reaction to his speech was that as a good Democrat he was attempting to do damage control for President Biden’s, frankly, confused or conflicted policy with respect to Israel. As such his speech reflects the fantastical view towards Israel of American Jews and, indeed, many non-Jewish Americans. On the one hand there’s the fantasy Israel, a liberal democratic country, a sort of paradise on earth. On the other there’s the real Israel which, while more liberal and more democratic than its neighbors, is not that liberal or democratic and is far from a paradise and in which public opinion, under the repeated assaults of Islamist terrorist groups, has grown increasingly hostile to those groups.

I wanted to call attention to these passages:

Hamas has knowingly invited an immense civilian toll during this war. Their goal on October 7 was to provoke a tough response from Israel by killing as many Jews as possible in the most vicious manner possible — by raping women, executing babies, desecrating bodies, brutalizing whole communities.

Since then, Hamas has heartlessly hidden behind their fellow Palestinians by turning hospitals into command centers, and refugee camps into missile-launching sites. It is well documented that Hamas soldiers use innocent Gazans as human shields. The leaders of Hamas, many of whom live lives of luxury in places far away from the poverty and misfortune of Gaza, do not care one iota about the Palestinians for whom they claim to nobly fight.

and

The only just solution to this predicament is one in which each people can flourish in their own state side-by-side.

But for a two-state solution to work over the long term, it has to include real and meaningful compromises by both sides.

and

Right now, there are four major obstacles standing in the way of two states, and until they are removed from the equation, there will never be peace in Israel and Gaza and the West Bank.

Those four major obstacles are:

Hamas, and the Palestinians who support and tolerate their evil ways.

Radical right-wing Israelis in government and society.

Palestinian Authority President Mahmoud Abbas.

Israeli Prime Minister Benjamin Netanyahu.

Does anyone else see the cognitive dissonance in those statements? You can not coherently insist on a “two-state solution” and reject both Hamas and Palestinian Authority. Those are the alternatives for Palestinian governance. With whom would such a settlement be negotiated? There are no liberal democratic Palestinian parties with anything resembling majority support waiting in the wings.

And, of course, he’s assuming that whoever would replace Benjamin Netanyahu would be less “right-wing” and nationalistic than Mr. Netanyahu. IMO that reflects the fantasy Israel again. IMO Netanyahu’s bad polling numbers are due to the attack on 10/7 not because he’s not liberal or democratic enough.

This is an aspect of the situation in Gaza that I had not previously considered—the roles of tribes and clans. Jacob Magid reports at Times of Israel:

The Doghmosh Family — a major clan in Gaza — has issued a statement declaring that all Hamas members are legitimate targets after its leader was assassinated by members of the terror group along with ten other relatives allegedly for stealing humanitarian aid and being in contact with Israel.

The statement pledges retribution against all responsible and warns Hamas fighters not to test the clan’s patience.

Here’s an excerpt from a short paper at Middle East Brief by Dror Ze’evi on the tribes and clans in Palestine:

From March to July 2007, the British journalist Alan Johnston was held in the Gaza Strip by Jaysh al-Islam (the Army of Islam). It was later revealed that the epithet was an alias for a local group of families headed by the Dughmush clan, which is said to have been recruited by al-Qaeda.

According to some sources, it took a combination of Hamas’s military might and a hefty transfer of cash to convince the clan to give up its British Hostage. Then, in late October 2007, serious fighting broke out near the city of Gaza between Hamas and another clan, the Gaza-based Hillis family, said to be Fatah supporters, in which four people were killed and scores injured. An entire neighborhood was leveled in the fighting, which ended in a cease-fire agreement. Intermittent fighting between Hamas and these clans continues to this day. These incidents draw our attention to a seldom observed reality of Palestinian political life: Clans, which share many attributes with tribal structures but have developed along a different path, are a major factor in local politics and in many ways define the boundaries of what is politically possible.

In the Palestinian territories, clans (locally called hamulas, sing. pronounced hamoola) have become a focus of political activity and major hubs of local power. Since members of Hamas or Fatah invariably belong to their clans as well, when a member of one organization is killed by a member of another, and the killer’s identity is known, it is no longer just an issue of organizational enmity. The perpetrator is likely to be sued by the victim’s clan in accordance with local tribal law. Thus, Hamas in Gaza will take action in certain neighborhoods of Rafah or Khan Yunis only after informing the major local clans and asking their permission. In the West Bank, Abu Mazen’s Palestinian Authority will seldom appoint a senior official not approved by the local clans. Any attempt by the government to disarm militias is automatically perceived as an attempt to chip away at the power of the clans and encounters serious opposition.

I found the paper interesting but not particularly elucidating. I suspect these are social relationships into which you really must be born to understand. To my eye it highlights the many aspects of this conflict. It’s not just Israelis vs. Palestinians. It’s also tribe against tribe and clan against clan. All the more reason that we should be cautious in involving ourselves in these conflicts.

I’ve pointed this out before but not precisely in this context. There is an unappreciated similarity between Russian President Putin and Israeli Prime Minister Benjamin Newtanyahu. Neither one of them is a radical. They don’t represent the “far right” in their respective countries; they’re moderates by their own countries’ standards. Were they to be replaced the results would almost undoubtedly be worse for the outcomes we claim to want.

Putin represents the opinions of a majority of Russians; Netanyahu those of a majority of Israelis. We are kidding ourselves if we say we desire regime change.

I wish we were thinking about how Russian and Israeli opinion became what they have rather than dreaming about how nice things would be if we didn’t have Putin or Netanyahu to deal with.

I recommend that you read Nate Silver’s analysis of the shift in voting patterns among blacks, Hispanics, and Asians. Here’s his summary:

It’s worth pointing out that Black voters overall are still heavily Democratic. But going from 97 percent of the vote to 90 percent — not to mention 80 percent as more recent polls have found — is an enormous problem for the party. Democrats have become increasingly dependent on the votes of college graduates, but college grads are the minority — about 40 percent of people aged 25 and older have a bachelor’s degree or higher, and the share is no longer really increasing as the number of Americans attending college is leveling off, particularly among men. Without winning huge majorities of Black voters, and solid majorities of Hispanics and Asian Americans, Democrats’ electoral math doesn’t add up to a majority.

To win the election Republicans don’t need to receive a majority of the black, Hispanic, or Asian vote. They just need to reduce Democratic black, Hispanic, and Asian votes in the “battleground states” by a percentage or two. They’re not going to stop that with campaign strategies targeted at white, suburban, college-educated women.