Politics & Policy

Manchin Reiterates Support for Senate’s 60-Vote Requirement for Legislation

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There has been an increasing amount of discussion among Senate Democrats about scrapping the upper-chamber’s 60-vote requirement to advance legislation. West Virginia Democratic senator Joe Manchin made news on Monday when told The Hill that he is “interested in listening to anything” regarding filibuster reform because the Senate “isn’t working.” 

But Manchin wrote on Twitter on Tuesday afternoon that he opposes repealing the Senate filibuster:

Does that mean Manchin is absolutely committed to keeping the 60-vote threshold for legislation (outside the budget-reconciliation process, which only requires a simple majority but is subject to complex rules)? A spokesman for Manchin tells National Review the answer to that question is “yes.”

Markets

Pensions: For Whom the Bell Tholes

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(SARINYAPINNGAM/iStock/Getty Images Plus)

I posted something yesterday on some of the challenges — to use too mild a word — that are looming for retirees, about-to-be retirees, and pension funds from an ultra-low-interest-rate environment that, thanks in no small part to central-bank involvement, has persisted for years and is likely to continue for quite a few years more.

Writing for Bloomberg Opinion, John Authers takes note of a recent case that highlights the difficulties surrounding the pension sector:

In Thole v. U.S. Bank, two retired members of U.S. Bank NA’s pension plan had sued for the right to bring a class action against the pension plan on the basis that it had been poorly investing the plan’s assets. They requested the repayment of approximately $750 million to the plan in losses suffered due to what they regarded as mismanagement. They had never, however, suffered any interruption to their own pension payments, which had continued in line with the contractually agreed amounts.

The [Supreme] court ruled that they could not bring an action against the pension plan because: “They have received all of their vested pension benefits so far, and they are legally entitled to receive the same monthly payments for the rest of their lives. Winning or losing this suit would not change the plaintiffs’ monthly pension benefits.”

The fact that defined-benefit plans have a legal duty to keep paying pension benefits does not, however, guarantee that they will find the money from somewhere to pay it.

Indeed not, and Authers has more than a little sympathy for what the dissenting justices had to say:

The Court holds that the Constitution prevents millions of pensioners from enforcing their rights to prudent and loyal management of their retirement trusts. Indeed, the Court determines that pensioners may not bring a federal lawsuit to stop or cure retirement-plan mismanagement until their pensions are on the verge of default. This conclusion conflicts with common sense and longstanding precedent.

To understand why the majority disagreed, this article in the National Law Review gives an excellent summary.

But whatever the law may say, the underlying problem that ultra-low interest rates represent to defined-benefit plans is not going away.

Authers:

The Federal Reserve appears determined to put a cap on corporate bond yields. Defined-benefits plans are dependent on two factors: returns on assets (largely stocks), and bond yields, which determine how expensive it is to buy an income – or in other words to meet their liabilities. The latest figures from the actuaries at Mercer, up until the end of May, show that S&P 1500 plans were in deep deficits, of about $500 billion, although the counter-acting effects of higher share prices and lower discount rates have largely stopped the deficit from deepening any further.

The problem is that the Fed’s master plan for getting through the next few years, and financing the huge sums of money that were thrown at the Covid-19 pandemic, is financial repression. This is the phrase for effectively forcing investors to lend to the government at artificially low rates . . . . There are arguments that this may be less painful than the alternatives, but it will be excruciating for pension plan managers, as it makes the cost of their liabilities artificially high.

As Authers notes, the nightmare scenario for the future is that large corporate pension plans will find that they are unable to meet their commitments. The presence of the Pension Benefit Guaranty Corporation may offer some comfort to pensioners, but that will be of cold comfort to companies brought to their knees by pension obligations suddenly made much more onerous by the effects of low interest rates (for another good discussion of how this can work, go here). And it will be terrible news for their current employees too.

Just another reminder that (artificially) ‘cheap’ interest rates are a lot more expensive than they seem . . .

World

FCC Designates Chinese Tech Giants Huawei and ZTE as National-Security Threats

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A man walks past a Huawei logo at the International Consumer Electronics Expo in Beijing in 2019. (Thomas Peter/Reuters)

The Federal Communications Commission has formally designated two technology giants closely connected to the Chinese Communist regime as national-security threats to the integrity of telecommunications networks and the communications supply chain.

The designation applies to Huawei Technologies Company and ZTE Corporation.

FCC chairman Ajit Pai announced that, after a full investigation, the commission’s Public Safety and Homeland Security Bureau (PSHSB) concluded that “[b]oth companies have close ties to the Chinese Communist Party and China’s military apparatus, and both companies are broadly subject to Chinese law obligating them to cooperate with the country’s intelligence services.” Consequently, the companies pose “national security risks to America’s communications networks — and our 5G future.”

The designation, under a process the FCC adopted last year, in a November 22 order entitled “Protecting Against National Security Threats,” bars Huawei and ZTE from access to money in the Universal Service Fund. The USF is an annual $8.3 billion account funded by fees American consumers and businesses pay on their phone bills. The USF is designed to be spent on developing and maintaining secure networks; the point of the designation process is to foreclose spending on equipment supplied by companies that could threaten national security.

Huawei and ZTE were originally cited when the designation process went into effect. That triggered the PSHSB process that concluded with today’s formal designation announcement.

On Huawei, besides the company’s ties to the Chinese regime, the commission’s designation order noted:

Huawei’s founder, Ren Zhengfei, previously served as a director in the People’s Liberation Army of China (PLA), the armed forces of China and its ruling Communist Party, and that former Huawei employees have provided evidence showing that Huawei provides network services to an entity believed to be an elite cyber-warfare unit within the PLA.

The FCC further observed that credible reports had highlighted known cybersecurity risks and vulnerabilities in Huawei equipment. Moreover, Congress and the executive branch have restricted the purchase and use of Huawei equipment; in fact, the Defense Department has banned the sale of Huawei devices on military bases and other DOD facilities worldwide.

DOD has placed similar prohibitions on ZTE, whose equipment is also notorious for cybersecurity risks and vulnerabilities. The FCC also found that ZTE undermined the U.S. embargo on Iran by sending $32 million of American goods to Iran and then obstructing a Justice Department investigation.

In 2017, ZTE pled guilty to violating U.S. sanctions against Iran. It agreed to pay a fine of over $430 million, as well as additional settlement agreements to other U.S. government security agencies that brought the total payment to over $892 million.

Back in February, the Justice Department announced a racketeering indictment against Huawei, charging it, along with two U.S. subsidiaries, with conspiring to steal trade secrets. The DOJ described the scheme as a “long-running practice of using fraud and deception to misappropriate sophisticated technology from U.S. counterparts.” The indictment alleges, among other things, that Huawei has abetted Iran’s domestic surveillance regime, including during the 2009 demonstrations that were crushed by the Shiite jihadist regime.

The indictment also charged Wanzhou Meng, the Huawei’s chief financial officer. She is currently under house arrest in Canada, fighting extradition on the U.S. charges.

As I noted in a post this morning, China has just pushed through a law that subjects Hong Kong to Beijing’s control, under the guise of national security against “subversion” and “terrorism” — the Communist regime’s words for protests in the formerly semi-autonomous territory. China’s aggression in Hong Kong, its domestic persecution of Uighurs and other groups, and its central role in the coronavirus pandemic, have ratcheted up pressure on the Trump administration to respond with meaningful punitive measures.

U.S.

Uncommon Knowledge: The Case against Revolution with Ayaan Hirsi Ali

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As the United States and the world embark on fraught conversations about race, history, law enforcement, and the underpinnings of our very civilization, Ayaan Hirsi Ali joins Peter Robinson for an enlightening conversation. A refugee from Africa, Hirsi Ali fled to Europe to escape an arranged marriage, becoming an activist, (now former) member of the Dutch Parliament, and now a research fellow at the Hoover Institution. With a different set of life experiences and perspectives from American-born Blacks, Hirsi Ali discusses how, as a Somalian, she views America as the best place on earth for minorities to grow up and achieve their potential. While acknowledging the hardships and miseries that American Blacks have endured and that racism still exists in many quarters of American society, Hirsi Ali emphatically believes that America is more than capable of solving racial inequalities, provided it preserves the institutions that ultimately ended slavery and empowered the protest movements of the 1960s that birthed the Civil Rights Movement. As she wrote in a recent column for the Wall Street Journal, an opinion she reiterates on this show, “There will be no resolution of America’s . . . problems of free thought and free speech are no longer upheld as sacrosanct. . . . Without them, honest deliberation, mutual learning, and the American ethic of problem-solving are dead.”

Recorded on June 25, 2020

Law & the Courts

The Supreme Court’s Insoluble Problem

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Chief Justice John Roberts can’t make the Supreme Court’s abortion jurisprudence democratically legitimate. Nobody can. My new Bloomberg Opinion column.

National Security & Defense

UFO or Foe?

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People visit the Alien Research Center in Hiko, Nevada, September 19, 2019. (Jim Urquhart)

UFOs are back on legislators’ radar. What sounds like a tinfoil-hat topic has actually sparked debates among American national-security leaders.

On June 17th, The Senate Intelligence Committee presented the Intelligence Authorization Act for Fiscal Year 2021 which included a provision for the centralized collection of information related to “unidentified aerial phenomenon.” The committee, chaired by Senator Rubio (R., Fla.), said that “information sharing and coordination across the Intelligence Community has been inconsistent,” and expressed concerns “that there is no unified, comprehensive process within the Federal Government for collecting and analyzing intelligence on unidentified aerial phenomena, despite the potential threat.”

Within 180 days of the act’s implementation, the committee calls for a report on all unidentified aerial phenomena including “Identification of potential aerospace or other threats posed by the unidentified aerial phenomena to national security, and an assessment of whether this unidentified aerial phenomena activity may be attributed to one or more foreign adversaries.” The goal of the provision is an overall standardization and centralization of intelligence on UFOs.

Is this just stargazing?

There may be good reason to keep an eye out for flying saucers. In the past few years, Navy members have reported unidentified aircrafts following Naval aircrafts off both the West and East coasts. Apparently, the Pentagon secretly investigated instances like these until 2012 under the Advanced Aviation Threat Identification Program.

These Naval sightings were caught on video between 2004 and 2015, prompting speculation about anything from aliens to Chinese or Russian military technology. The videos were initially leaked but confirmed real by the Navy in 2019.

The frequency of these sightings has increased since 2014 and one of these mysterious aircrafts almost collided with a Naval pilot in Virginia Beach in 2014. What’s more, witnesses report a lack of visible engine and exhaust plumes.

Aside from little green aliens, a likely target for speculation could be Russian or Chinese technology. While the U.S. stepped back on hypersonic technology, Russia and China invested heavily. Other explanations have to do with drone technology. 

The Pentagon, however, is not so sure. About the videos, Pentagon spokeswoman Sue Gough said that “the [Defense] department has determined that the authorized release of these unclassified videos does not reveal any sensitive capabilities or systems, and does not impinge on any subsequent investigations of military air space incursions by unidentified aerial phenomena.” The Air Force is not concerned about a foreign breach of security either. Major Bryan Lewis, Air Force spokesman, stated that the Air Force is “not concerned that China or Russia have developed a long-range capability about which we are not aware.”

Whatever the target of debate, does it really matter? These sightings are not cornfield flying saucers, they are confirmed breaches of military airspace that exhibit highly advanced — if not illusory — technological capabilities. Understanding these events is also essential in patching up any shortcomings in American defense capabilities. A centralized record for lawmakers and national-security leaders is long overdue and a sound step toward shoring up our defense abilities and detecting potential threats.

And who can deny the additional intrigue added to a growing storyline of America’s unconventional defense developments — Space Force, and now this?

White House

Wait, Just Who Is Not ‘Letting Trump Be Trump’?

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President Donald Trump takes questions during a news conference at the White House in Washington, D.C., June 24, 2020. (Carlos Barria/Reuters)

One of the president’s most devoted defenders, Jeffrey Lord, writes over at The American Spectator:

As this is written, the Trump White House is awash in almost the identical kind of political nonsense that engulfed the Reagan White House. The mantra is the same: The polls are a disaster, the president doesn’t get it, he needs to change course, he may withdraw and not run again, he’s going to lose in a landslide…

To wax Seinfeldesque? Yada, yada, yada.

My belief in the 1980s Reagan era was, Let Reagan be Reagan.

And looking back now, that is exactly what Americans loved about him.

And all these years later, as I suggested in 2013 when the political savants of the day said the very idea of a Trump candidacy was absurd?

Let Trump be Trump.

Who are these people who are allegedly not allowing Trump to be Trump? Do the president’s public comments, responses to interview questions, and tweets seem particularly stifled or carefully scripted or excessively strained by his staff? Does this president seem like a man who happily takes advice to choose his words carefully, to hide what he really thinks, and to attempt to match some stage-managed image instead of whatever he really thinks? Where is this different Trump that is being tied up and held back somewhere?

Can Lord point to any evidence at all that Trump is not “being Trump” and that the country hasn’t spent the past three and a half years witnessing “Trump being Trump”?

Because if Trump has been Trump, and he’s in the shape he’s in — with lousy polls and small turnout at his rally in Tulsa and difficulty even hinting at the broadest outlines of a second term agenda — then perhaps the problem isn’t that Trump is somehow being restrained or suppressed or micromanaged. Maybe the problem is Trump! Or maybe it’s just a heck of a lot easier to run against Hillary Clinton than Joe Biden.

The parallel between “let Reagan be Reagan” and “let Trump be Trump” probably hits a snag on the point that lots of Americans really liked Ronald Reagan — a much higher percentage of the public than the percentage that likes, or at least approves, of Trump.

One other way the Reagan–Trump comparison doesn’t work so well is that from mid-February 1984 on, Reagan pretty much stomped Walter Mondale in the polls.

Culture

Keeping Princeton Open

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The Princeton Open Campus Coalition has written an excellent letter in defense of academic freedom at the university. The students are pushing back against demands for required courses in left-wing thought and mandatory “diversity training” for faculty and staff. An excerpt:

The demand for “anti-racist training” is nothing more than the institution of a wrongthink correctional program, and we strenuously oppose any attempt to require “cultural competency” or “unconscious bias” training for any member of the University community. This training would undoubtedly coerce members of the community to accept the premises and conclusions that proponents of these reeducation camps advance. There would be no room for any act of dissent or good-faith debate on whether a particular instance of speech or action indeed amounts to racism. Potential dissenters would be intimidated in an atmosphere of fear and potential retribution. We have no doubt that every member of the Princeton community, ourselves certainly included, would strongly and unequivocally identify with the cause of “anti-racism” . . . . But “anti-racism” is a vague and radically unhelpful term that will be filled in with question-begging conclusions by those who subscribe to the reigning orthodoxy on matters of race. Affirmative action, for example, has long been a matter of contention, not only in American political and legal discourse, but also in academic circles. Are we prepared to say, as the University of California system appears to have done, that opposition to affirmative action is “racist” and constitutes an impermissible “microaggression?” Other examples of controversial matters touching on race include, but are certainly not limited to, the historical accuracy of the New York Times ’s recently launched “1619 Project,” the relationship between police officers and their communities, illegal immigration and immigration enforcement, urban crime, the so-called “War on Drugs,” issues of family structure and father-absence in poor communities of every description, and welfare policy. These, and other, matters lie at the core of significant legal, political, and academic discourse. Proper engagement with the various sides of these debates is premised on the robust protection of the freedom to make reasoned arguments and freely and publicly explore different points of view on these contentious issues with no regard for whether these free pursuits of truth “trigger” others.

Princeton Alumni for Academic Freedom is asking alums to sign a letter supporting the students.

History

A Word for Thaddeus Kosciuszko

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Portrait of Thaddeus Kosciuszko flanked by a cannon on the right and other rides on the left, 1835. (British Museum/Wikimedia Commons)

Earlier this month, during unrest in American cities, there was a lot of attention paid in Washington, D.C., to the area just outside the White House. As we continue into July, I don’t want to let an unfortunate but little-noted consequence of what happened there to be forgotten. 

Not far from the White House stands a statue of Thaddeus Kosciuszko. As has become increasingly common, the statue became a target of impassioned effacement. It was not taken down, but its base was tarred by graffiti. 

Defacing the Kosciuszko monument belongs in the same category of historical ignorance as efforts to topple the Emancipation Memorial, statues of Civil War general and racially progressive president Ulysses S. Grant, and a statue of abolitionist immigrant and Union soldier Hans Christian Heg. As detailed, among other places, in The Peasant Prince: Thaddeus Kosciuszko and the Age of Revolution by Alex Storozynski, Kosciuszko, born in 18th-century Poland, came to America early on in the American Revolution, motivated entirely by his belief in its justness as a cause. He played an important role in the Revolution, helping the revolutionaries to win the Battle of Saratoga and to build West Point, among other efforts.

After the war, Kosciuszko returned to his native Poland, hoping to accomplish there what he had helped to do in America. He assisted in the drafting of Poland’s Constitution (Europe’s first), helped to lead Poland’s military struggle against Russian invasion, then led an uprising against Russia’s conquest. During this time, he issued the Proclamation of Poleinac, which significantly curtailed serfdom in Poland. Kosciuszko ultimately lost the battle for Poland, was captured, and was sent to Russia. His nation became absorbed within Russia.

Eventually, he was released and returned to America, furthering friendships with such luminaries as Thomas Jefferson, with whom he debated slavery. Kosciuszko worked out an arrangement with Jefferson that the latter use the former’s will to free slaves and provide for them after their liberation. Jefferson, however, reneged on this, to his immense discredit. Kosciuszko’s life, moreover, ended sadly: He died in Switzerland, a man without a country, Poland’s borders having been erased. 

We rightly cherish the memory of this important, forward-thinking man, an immigrant who showed his dedication to liberty and equality on two continents (in even more ways than I detailed here) yet faced resistance to his ideals in his own lifetime. Again, if those who see in every statue just another old-looking figure to be violently belittled knew even a little bit about history, they might have shown some forbearance about this one. At any rate, we should wish the best of the efforts, encouraged by the mayor of Warsaw and the Polish ambassador to the United States, to keep this statue worthy of the man it honors.

Law & the Courts

The Implications of Espinoza

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The Supreme Court’s decision today in Espinoza v. Montana Department of Revenue was an important victory for school-choice programs.

The majority opinion declared that a state “need not subsidize private education. But once a State decides to do so, it cannot disqualify some private schools solely because they are religious.”

Diana Verm, senior counsel at the Becket Fund for Religious Liberty, tells National Review the decision has implications beyond school-choice scholarships:

There are all sorts of ways religious groups partner with the government. This means that governments can no longer use Blaine Amendments as the excuse to discriminate against groups that do good work because they are religious, including groups that shelter the homeless, prison ministries that fight recidivism, and soup kitchens and hospitals that serve the poor.

This is a great decision for religious freedom. Blaine Amendments, and their limits on free exercise, have been used to chill government partnerships with religious groups broadly, and schools specifically. As we grapple with discrimination around the country, we are grateful the Supreme Court took a strong stance against religious discrimination and anti-Catholic bigotry.

Elections

Trump’s Challenge in the Polls

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I noted here the other day that Trump has in the past made up as much ground in the polls as he needs to make up now.

Harry Enten compares what Trump needs to do against the performance of past incumbents running for reelection, rather than to Trump’s 2016 race. His key point: “Since 1940, the only incumbent losing at this point in the cycle who would go on to win another term was Harry Truman. He, like Trump, was down around 10 points to Thomas Dewey in the early summer of 1948.” And Truman, as Enten points out, was making his first run for president and so wasn’t a typical incumbent.

But then again, Trump isn’t a typical incumbent in a lot of ways, either.

Culture

‘A Woman Identified as Male at Birth’

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A trans woman is a man who begins at some point to self-identify as a woman. Try telling that to the woke staff at Merriam-Webster dictionary, who are now defining a trans woman as “a woman who was identified as male at birth.” (For now, the definition of “woman” still stands as an “adult female person.”) This is utterly unscientific, politicized nonsense that must be resisted.

Law & the Courts

The June Medical Decision Was Not a Win for Women’s Health Care

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In the wake of the Supreme Court’s ruling yesterday in June Medical Services v. Russo, abortion-rights groups are hailing the decision as a victory for women’s health care. Anyone familiar with the specifics of the Louisiana law — and not financially invested in propping up our regime of entirely unfettered legal abortion — knows this claim is obviously untrue.

It’s no surprise, however, to see groups such as Planned Parenthood, NARAL Pro-Choice America, and the Center for Reproductive Rights repeating this falsehood, because this is the narrative that prevailed all throughout the debate over the law and the only narrative that could justify opposing such a commonsense, pro-woman policy.

Let’s remember what was at stake in this case. On a bipartisan basis, Louisiana enacted a policy requiring abortion providers to maintain admitting privileges at a hospital within 30 miles of their clinic, so that women who need emergency follow-up care could obtain it more easily. A similar policy already applies to every other type of ambulatory surgical center in Louisiana; the law aimed to close the loophole that had permitted abortionists to avoid regulation despite being providers of outpatient surgery.

The law did not in any way infringe on a woman’s right to abortion as courts have outlined it. It didn’t infringe on women’s ability to decide whether or when to get an abortion. It didn’t place a limitation of any kind on abortion procedures in Louisiana. It merely required abortionists, like all other surgical providers in the state, to maintain admitting privileges at a local hospital for the sake of the health and safety of women seeking an abortion.

This is what Planned Parenthood is asking us to believe was a “terrible and dangerous abortion restriction,” what NARAL has cast as a “clinic shutdown law,” what the Center for Reproductive Rights insists was an attack from those “hell-bent on banning abortion.”

These groups fundraise endlessly off of the proposition that “women’s rights” are in danger, promising that they alone exist to protect “women’s health care.” Why, then, are they the loudest voices cheering the downfall of a policy crafted specifically to protect the health of women seeking abortions? As they purport to represent women’s interests, these activist groups instead are celebrating a case brought to court not by women, but by abortionists, who have a direct financial stake in continuing to perform abortions, no matter the health and safety risks to the women involved.

Science & Tech

Will T Cells Save Us from COVID-19?

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From the beginning of the pandemic, there’s been a lot of focus on “antibody tests” that determine whether people have been infected with, and thus are likely immune from reinfection with, the virus. It’s starting to look like that focus was misplaced, or at least incomplete.

Some studies have suggested that other coronaviruses (such as the old SARS) might give people immunity to COVID-19 via T cells, another part of the immune system. And now a Swedish study hints that infection with COVID-19 itself sometimes creates T-cell but not antibody immunity.

The actual paper is dense with fancy science words I don’t understand (“acute phase SARS-CoV-2-specific T cells displayed a highly activated cytotoxic phenotype . . .”), but here’s some information from a press release:

“Our results indicate that roughly twice as many people have developed T-cell immunity compared with those who we can detect antibodies in,” [says one of the paper’s authors] . . .

“One interesting observation was that it wasn’t just individuals with verified COVID-19 who showed T-cell immunity but also many of their exposed asymptomatic family members,” says Soo Aleman. “Moreover, roughly 30 per cent of the blood donors who’d given blood in May 2020 had COVID-19-specific T cells, a figure that’s much higher than previous antibody tests have shown.”

. . . Patients with severe COVID-19 often developed a strong T-cell response and an antibody response; in those with milder symptoms it was not always possible to detect an antibody response, but despite this many still showed a marked T-cell response.

This is a study of about 200 people that has not been peer-reviewed, so it might not hold up and its results might not generalize to other countries. But needless to say, the more people who are immune, the better, and if more people have been infected than we thought, the fatality rate is lower than expected.

Also worth reading: This piece from The Conversation on whether COVID-19 could burn out sooner than we thought.

Health Care

Trump Never Would Have Been Pro-Mask

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James Surowieki wonders why masks weren’t the favored solution of conservatives in America. They are about individual initiative, they’re cheap, and initially the scientific experts were against them.

You can come up with all sorts of explanations for why Trump didn’t embrace masks in mid-March (by which point he was admitting that the pandemic was a problem). But honestly it feels random, like if the right person had had his ear, he could easily have gone the other way.

— James Surowiecki (@JamesSurowiecki) June 30, 2020

I remember at the beginning of this crisis, I vainly wished Trump’s germaphobe instincts had kicked in. But upon reflection, I don’t think Trump ever would have been pro-mask.

Trump is a showman, and he cares about the look and “feel” of things. And I would bet the family farm that he believes masks put their wearers into a more fearful, downcast mindset, rather than a confident one. And further, that he believes this “mood” of the country plays a huge role in his reelection. His religious upbringing is about the power of positive thinking. And his approach throughout the crisis has been to project confidence. Masks don’t fit into it.

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