Friday, January 13, 2017

Edward Harrison — The potential for military confrontation due to Trump’s foreign policy


Edward Harrison examines Rex Tillerson's testimony to the Senate. He is guardedly optimistic about US-Russian relations and somewhat pessimistic about US-China relations.

One problem I see developing with Trump's style as a negotiator is that it is an advantage to insert uncertainty in private dealmaking purposefully. However, uncertainty in domestic and global politics is destabilizing and that extends to economic matters, too. Trump apparently believes he can strike a balance in this regard, but things can get out of hand in unexpected was and have unforeseen consequences. 

37 comments:

John said...

Former high ranking officials in the UK's foreign office have been heard complaining that uncertainty in policy may be to discombobulate one's enemies, but what is the point of doing so to one's allies (EU, UK, Nato, etc)? It doesn't make any sense. If the British are heard complaining - and the British are the most docile of allies - clearly there are frictions. A lot of it stems from Trump not in fact really having a clearly well thought out foreign policy.

Penguin pop said...

John, it goes back to what Steve Bannon said. They will try anything against the wall and make it stick. In other words, they really don't know anything and it's going to be like pulling teeth trying to invent the wheel when it's already been done before. He's a media savant (hence explaining how he got the title of "Master Persuader"), but clearly a dullard on so many other things.

John said...

Penguin, at the moment it seems that Trump is the savant in the old Peter Sellers film Being There: everything he does is endowed with some sort of media brilliance or political genius, when in fact he's a dope! Eventually, he'll have to stop tweeting and actually do policy, and it now is blindingly obvious that he doesn't really have any policies: for example, repeal Obummercare and "replace it with something terrific".

The same people going gaga over Trump are the same ones who went gaga over Obummer eight years ago, and they also happen to be the same dunces who dreamed that it took a village crafted by Killary's hands and sang"Don't Stop" with fat Bubba and went braindead when he played the sax, and they also happen to be the same lamebrains who were brainwashed with gibberish about "a shining city upon a hill". Some people never learn, no matter how many times they get royally shafted. So lube up, bend over and get ready to take it in the ass again. Oh, but the cry is, This Time It's Different...

Matt Franko said...

He's not a polymath.... he's maybe a 'monomath'...

Matt Franko said...

John,

HE is not going to come up with an Obamacare replacement he is getting a team together to do it... from Johns Hopkins, Mayo Clinic, Cleveland Clinic and top actuaries from industry...

ie NOT Professor Gruber...

He is going to the best places to get a team together to do it... this is what good management does...

He is not a ditch digger...

That said, if the Johns Hopkins guy and the rest of the team thinks "we're out of money!" then it will fall way short just like Obamacare...

Penguin pop said...

"That said, if the Johns Hopkins guy and the rest of the team thinks "we're out of money!" then it will fall way short just like Obamacare..."

Matt, what do you think are the chances of that team coming to that conclusion? I would hope they would be smarter than the idiots who don't know how a balance sheet works and think we're out of money and on the metals.

John said...

Matt,

I know you're a Trump man, but come on! I was once a Trump man, but bailed because I couldn't get much sense out of him.

It's really unacceptable for a president to say my policy is whatever the guys at Johns Hopkins say! Does he not have a policy? Does he not have any idea or any vision of what it should be? Gruber's next job could be at Johns Hopkins. Gruber and the Johns Hopkins health economists are no different.

When Americans voted for Trump, they were presumably under the impression that Trump in fact had a policy. Now he's telling them, more fool you, I never had one other than to make things "terrific". So apparently he hasn't got the faintest idea of what to do, but the Johns Hopkins guys do. This isn't leadership. This is merely handing power to other Gruber-like neoliberal professors.

Let me understand this. If Obummer asks the shady Grubers of the world to come up with a health policy, he is to be pilloried. If Trump asks shady Gruber clones to come up with a health policy, he's a man of unparalleled vision. Although it must be said, that in Obummer's defence he at least knew what the outcome should look be. Trump doesn't, otherwise he would have articulated it. His silence proves he doesn't have a policy. Would that not be a fair conclusion?

If handing responsibility over to experts is such a winner, in that case Trump may just as well hand all policy over to who he considers experts and play golf for the next four years. What is very clear is that Trump does not have any idea of what to do, and so being a PR man to the core, he claims that he's going to take advice and come up with the best possible healthcare for Americans. He's stalling for time, but eventually he's going to be found out.

John said...

Penguin: "Matt, what do you think are the chances of that team coming to that conclusion?"

The answer is preordained. This way Trump can stall and then he can hide behind the skirts (or up the skirts while grabbing some pussy) best health experts in the world.

If Trump was half the leader he claims he is, he'd say, this is my policy and I'm passing it in my first hundred days. It's the policy I've given careful consideration to because a prospective president needs to have a healthcare policy. He can't say any of this. And we know why: because he doesn't have one. If he had one, do you not think we would have heard it? His silence is proof that he doesn't have a policy. Where's the confusion?

Penguin pop said...

"The answer is preordained. This way Trump can stall and then he can hide behind the skirts (or up the skirts while grabbing some pussy) best health experts in the world.

If Trump was half the leader he claims he is, he'd say, this is my policy and I'm passing it in my first hundred days. It's the policy I've given careful consideration to because a prospective president needs to have a healthcare policy. He can't say any of this. And we know why: because he doesn't have one. If he had one, do you not think we would have heard it? His silence is proof that he doesn't have a policy. Where's the confusion?"

This is why so many people hate Cheeto so much. He's vague and wishy washy on everything. He claimed there would be a border wall, and now it's a fence if any. He changes his mind constantly and you never know what his real position is, which I'm suspecting he has none at this point. He has proven himself to be a king at telling lie after lie and all his false promises. The Nigerian prince scam would be an apt analogy for what he is. I've pretty much given up on there being anything positive coming out of this unless the activism really goes up the roof and he's pressured at every corner. He's less likable than Reagan, dumber than Tricky Dick and Dubya to me. I wanted to give him a chance to see if he'd be different. I didn't vote for him and I never would, and I knew Killary wouldn't have been much of a blessing either, but these are the cards we've been dealt with. Damned if we do, damned if we don't.

Bob said...

Trump has expressed support for single-payer health care in the past.

John said...

Bob: "Trump has expressed support for single-payer health care in the past."

True, but, as Penguin Pop says, it's in a very wishy washy way. Tune in another day and he says something else. That's the real problem. Nobody really knows what the policies are because he seems to make them up as he goes along. He never nails his colours to the mast. Other than on the wall, which is now a fence, he never says, love me or loath me, this is where I stand.

Government is hard enough when you know what it is you want to achieve. Imagine how hard it's going to be when you don't know what it is you're meant to be achieving?!!?! And then it all turns to shit because you learn from a tweet that the prez has now reversed his position and wants to do something else instead. And why can't that be achieved at the drop a hat?

Penguin, yeah, the Trumpsters are really going to have to hold his feet to the fire to get anything. You're too hard on Nigerian scam artists. They didn't have the luxury of a rich daddy giving them a gigantic fortune, which he then did little with. If Drumpf put all his money in an index tracker he'd be between two and three times richer than he claims to be. But according to some of the top accountants in the US, judging by the information that's available, Drump isn't even a billionaire. If he had indexed the money his daddy gave him, Drumpf would be worth approximately $20 billion and $30 billion. A Nigerian scam artist makes money - he doesn't lose it! And if you gave a Nigerian scam artist a casino, it wouldn't file for bankruptcy!

Tom Hickey said...

I am with Matt on this. DJT's m.o. is to hire experts to get a job done. This is unlike the normal political process in which politicians consult with lobbyist and then conspire with each other to distribute the $ in a way that they can reach compromise on. It has little of nothing to do with effectiveness or efficiency. This is the swamp that DJT promised to drain. I don't think he was just talking through his hat. His plan was to go around the normal process and get people who know what they are doing to work it out instead of throwing it into the pig trough.

Matt Franko said...

Maybe "single payer" of a premium not "single payer" of individual procedures...

Tom Hickey said...

BTW, Obama and the Dems jamming though the ACA only to see it repealed now shows the poverty that that philosophy.

Trump knows this, too. The political process is sausage making rather than Congress passing the president's preferred policies.

Trump has laid down the broad outline of what he will accept. Now the negotiation begins over how to achieve it.

DJT has already said to forget about just repealing the ACA. Only 18% of the country is behind that. It would be political suicide, as he pointed out.

So Congress has to repeal and replace if they don't want to amend the ACA. Obama even said he would support it if the can come up with something better.

No one knows what Trump actually wants and that is how a good negotiator operates. Obama gave away the store by not understanding key principles of negotiation. DJT is not going to fall into that hole.

Tom Hickey said...

Maybe "single payer" of a premium not "single payer" of individual procedures...

Single payer of individual procedures is the lowest cost. Anyone one Medicare that has had by procedures can tell you what the government pays. It's not much of what is billed.

I had an emergency develop several years ago for which I treated as Mass General. The bill came to 35K. Medicare paid under 3K and the supplement paid 20% of that.

I'm told that private insurers get about a 30% discount.

John said...

Tom: "DJT's m.o. is to hire experts to get a job done."

That may be his m.o., but that's an m.o. that's acceptable when buying nails and hammers, not for running a country. And what if the solution is worse than the status quo? Eventually, Trump is going to have to make some decisions, and not just palm it off to someone else. aAlthough that in itself may be his policy: why attract attention when it's easier to deflect the problem onto someone else? But even then, Trump will have to take responsibility if it doesn't work.

If he wanted to get the job done, he'd just pass Medicare for all or something better. Do you genuinely believe that the people at JHU are going to come up with something the insurance companies don't like? Because the only real solution is a policy that the insurance companies don't like. But the important point is that Trump has never given any thought to what healthcare in America should look like, otherwise we would have heard it. And if he has no interest in healthcare, how's he going to judge whether what the JHU people advocate will in fact get the job done?

Remember this has to get through a Republican congress. Between the notoriously rightwing JHU and an emboldened Republican congress, what works is a matter for interpretation. After all, the system before Obummercare also worked: if you didn't have insurance, then tough luck. That worked. Obummercare also works: the insurance companies make lots more money.

Too many presidents come in to office thinking that they're going to run things like a business, America PLC with the President as CEO. It doesn't take long to be disabused of that silliness. For it to be done with any competency, the job requires attention to detail. You got a sense of how uninterested to detail Trump is, when it was disclosed that he doesn't want to be briefed on intelligence every day.


John said...

Tom: "DJT has already said to forget about just repealing the ACA."

Trump promised to repeal it because it's a "disaster". He didn't say he'd amend it. Tom, he said it a million times: "Obamacare is a disaster" and that he'd "repeal" it on day one, if he could.

This is the healthcare equivalent of the wall becoming a fence. And a fence only where it's appropriate, you know, because in some places you can't build...

Matt Franko said...

I would bet Trump doesnt like the way single payer is done now where the providers submit a bill for individual procedures and the govt just pays the bill for the individual procedures... he would probably look at that as ripe for over-charging the payer...

He probably wants to do something like Warren's proposal where you capitate the individuals and the institutions just do what is necessary if somebody comes in for treatment... get a quote to cover the people per person and establish large pools of people for the provider institution to work with from an actuarial perspective...

All we really have is this to work with though which isnt much:

https://www.youtube.com/watch?v=6inQmf96SYQ


He says "I would make a deal with existing hospitals to take care of people...."

So he met recently with leaders of Johns Hopkins, Mayo and Cleveland Clinics like he said he was going to do to start the discussions... have to see where it goes...

He might think from the video "we are going to save so much money...." that he can hit existing budget targets for Medicaid/Medicare while still thinking "we're out of money!" like all the others...

From a financial management perspective, if you have a firm fixed quantity and payment guarantees its a different management approach than if you have no guarantees and just hope somebody comes in sick that you can bill the govt for individual procedures...

Nobody can achieve scale economies if there are no quantity guarantees...

Its called "Indefinite Duration/Indefinite Quantity" type approach and that is not how you get the best prices from a vendor... you have to commit to firm quantities...

You cant say "how much to build a building per floor?"... you have to say "how much to build this 30 story building?"

So Trump could say, "we have 48M people in Medicaid age 0 to 64, how much to provide their healthcare PER PERSON for one year?"





Matt Franko said...

" The bill came to 35K. Medicare paid under 3K and the supplement paid 20% of that.

I'm told that private insurers get about a 30% discount."


Well the 35k is the "list price" and then discounts are awarded it is standard pricing methodology 101... and nobody pays "list"...

the private insurers are paying for most of US healthcare that is where the providers get the bulk of revenues to cover their nut...

Sure they take the Medicare $$$ every little bit helps they already have the infrastructure in place...

Its like selling the Canadians pharma at their low prices... all you have in it is COG sold so if they sell Canada a pill for 5 cents that they get 12 cents for in US, and all it costs is a penny to produce they still make 4 cents off the Canada business and its accretive to earnings... but they couldnt do that for the US business they would go broke..

thats why this whole left outrage thing on the vote with the buying the pharma from Canada is all BS you cant dictate price to vendors period... all you can do is commit to large firm quantities to reap scale economies and then get hopefully quotes from several vendors who compete...

I think if Trump can get quotes he might be able to drop the price per enrollee by half...

... and this will probably have a detrimental effect on the economy as the increased productivity from the scale economies will mean less people working in some classifications...



Matt Franko said...

Rather "Indefinite Delivery/Indefinite Quantity":

https://en.wikipedia.org/wiki/IDIQ

It is far from ideal approach if price is most important criteria...

(FD I am a graduate of Defense Systems Management College...)

Matt Franko said...

Trump is changing what is termed "Acquisition Strategy":

https://www.mitre.org/publications/systems-engineering-guide/acquisition-systems-engineering/program-acquisition-strategy-formulation

Trump is proposing to modify the past approach to acquisition of healthcare to a new approach... seeking to bring the $$$ paid DOWN when viewed ex post...

John said...

Matt,

From all the details above, things don't get clearer but murkier and murkier. You're a Republican, a Trump man and you follow Republican politics in a lot more detail than the rest of us, so you're in a position to better gauge what is going on.

This may be an impossible question to answer, but what do you think Trump actually wants? He says a million times if he's elected prez he'll "repeal Obamacare because it's a disaster". Now apparently the Reps are saying there is zero chance of repeal but some amendments here and there are necessary. Politics is politics, but the current crop of Reps look like charlatans. They scream that Obamacare is a "disaster" and that they'll "repeal" this "socialism" if they ever get the chance to do so, but when they're handed the opportunity they say a few "amendments" should suffice, and that the Kenyan Muslim who didn't have a constitutional right to even be in the country did such a good job on healthcare that all it needs is a couple of tweaks. What kind of political party is this? These people should be televangelists.

So don't do what the Obummeristas do, and project their values on to their candidate! Forget for a moment what you think would work, what is it that Trump wants to do? Does he want to negotiate pharmaceuticals? Does he want to force lower costs from the insurers? Does he want to bulk buy into the insurance sector? Or will he just keep Obummercare, tweak it imperceptibly and call it Trumpcare?


Tom Hickey said...

The whole emphasis on cost in health care is, as we know, a red herring. The only constraint is real — available resources. Affordability is never an obstacle to a currency sovereign like the US government.

The objective is to provide high quality health care for every American and if the system is not present capable of doing that, then build it out, whatever it takes.

Cost not an object when it comes to military spending for the simple reason that the federal government issues the dollar using keystrokes, which are unlimited.

The same thing is true in every area of society that is vital. If the private sector is unable or unwilling to accomplish the task, or the task involves public goods or utilities, then the federal government should fund it.

The only area in which the government should not participate is in discretion goods and services. That is to say, government should be involved in providing needs and not wants.

The private sector can be involved in providing needs to the degree that needs are met effectively and efficiently, but the private sector should be chiefly involved in meeting wants rather than needs.

Of course the government doesn't need to either run the operations that provide for needs, or even administer them. That can be done on contract.

All the federal government needs to do is provide the funding and run an economic policy based on functional finance that ensures price stability.

Inflation? Tax it back. The right hand giveth and the left hand taketh away.

Tom Hickey said...

" The bill came to 35K. Medicare paid under 3K and the supplement paid 20% of that.

I'm told that private insurers get about a 30% discount."


Well the 35k is the "list price" and then discounts are awarded it is standard pricing methodology 101... and nobody pays "list"..


Not exactly. If someone is uninsured they are billed the full price. I know, since was billed full price for an incident that did not meet my high deductible before I was on Medicare. A friend of mine was insurance and he told me that I could likely bargain them down 30%, especially if I was willing to offer cash settlement. That's what happened. But most people likely don't know that and just pay the price or get hit with a judgment.

Bob said...

You have a health care system that the major stakeholders want. Hiring experts to make recommendations won't fool anyone. "Getting it done" requires political will.

Tom Hickey said...

You have a health care system that the major stakeholders want. Hiring experts to make recommendations won't fool anyone. "Getting it done" requires political will.

The US health care industry is not doing so well in some respects. Iowa just privatized Medicare and the ins co. are getting creamed. The state is going to have to pony up.

The ACA also has real problems with huge premium increases that is making it unaffordable for some, who are electing to just pay the penalty.

A lot of people, on the left included, were saying from he get-go that the ACA was trash and never should have been passed in the form it was. I was one of them. It was not only inadequate and poorly designed but stupid politically with the mandate and fine.

There is no way to have a universal health care program with the provisions that the public wants other than single payer like Medicare.

The no-brainer is to Medicare for all — and recognize that it doesn't have to be paid for. The only requirement is real. This involves the investment needed to provide increasingly high quality care in the present and future. This means that government must ensure that the private sector continues to develop innovative technology and that educational facilities are expanded to meet the needs of a growing population.

Bob said...

I've heard that some medical procedures are being done in India. Americans are being put on planes and sent overseas because it saves the insurer's money.

You want Medicare for all - you'll have to fight for it. Trump could be your hero, but he'll need the public behind him to scare the pants off those who have been bought and paid for.

Bob said...

PCR is not sounding optimistic:
http://www.paulcraigroberts.org/2017/01/13/is-trump-already-finished-paul-craig-roberts/

Noah Way said...

The Deep State is running the show regardless of who's on the throne.

Orwell was dead on. It's either Eurasia or Eastasia.

Hopefully not both at the same time.

Tom Hickey said...

DJT has not even been inaugurated yet. He just has to get through the next six days. Then we will see.

Penguin pop said...

PCR is having buyers remorse already. Not looking good. I am fearing the worst, but good point, Tom. Wait and see.

Tom Hickey said...

I am fearing the worst, but good point, Tom. Wait and see.

This is new territory and most people are viewing it through old lenses and projecting wildly. Stay calm and don't get sucked into the vortex.

Penguin pop said...

"This is new territory and most people are viewing it through old lenses and projecting wildly. Stay calm and don't get sucked into the vortex."

That's what I liked about the people who were able to foresee the DJT victory and were ahead of the curve all along. They view this whole situation through a new paradigm just like how Mike takes a unique approach to trading and making use of mental game even when the adversity is high. Since I know people who are seeing it a different way and I'm naturally very cynical and distrusting of the guy and also have my pretty left-wing bias, often times, I am torn between thinking DJT will be worse than Bush II or he'll completely defy my expectations, change reality and do some really unexpected stuff no one could have seen coming and be this Master Persuader after all I overlooked. I am looking at a 50-50 shot here. Tons of people who frequent comment on his Twitter page are in the fearing the worst mode and hate his guts beyond belief.

Again, the opinion polls for Trump according to this Quinnipiac poll show Trump having 37% approval right now before taking office. It's just like during the election when the numbers for him were at their lowest points after the Access Hollywood tape, and then he managed to pull off a surprise victory. I know you're also a generally left leaning person and you're one of the few that isn't repeating all the same fear and doubt I've heard from all the different progressive channels out there like Democracy Now, David Pakman, The Young Turks, etc. There are other progressives that are actually focusing on calling out the BS from Democrats and others on their own side and actually trying to educate others about MMT and not wasting too much time trying to talk about Trump, but I feel those people are still in the minority right now.

Bob said...

PCR is "old school", and is evaluating Tillerson's statements at face value. He admits that it could be a ploy. He states that he did not play such games during his confirmation hearings.

All the bases are covered. I'm a cynic, so I expect the worst.

Wait and see. We keep saying it, yet we don't do it. LOL

Matt Franko said...

John,

FD: #1, I think everybody other than the few of us are either not qualified, or are being made stupid... the operative scripture is "those who are retaining the truth in injustice... alleging themselves to be wise, are being made stupid..." Rom 1

That said, I dont think Trump has a very detailed plan .. I think he operates on strict but some simple and effective principles when it comes to business/material systems administration... and he is disciplined... like he always wears the same clothes....

Revising the entire Acqusition Strategy for US heatlhcare of over 300m people is way more complex than renovating the clubhouse at Doral, the F-35 program is way more complicated than renovating the old Post Office pavilion in DC into a small hotel ... so this is not going to be like falling off a log for him or anybody.... especially if anybody thinks "we're out of money!"...

I only think it will get a bit better from a material perspective under Trump as he and his people are material systems experts... as opposed to the Obama people who were more human focused and not qualified from a material systems perspective and many there being made stupid too...

We of course would do better than either Trump or Obama admins but we are not in any position of authority.... so we have to just sit back and watch... I think this might be what is really going on ie we have to go thru this with possession of the key knowledge and truth but no authority to apply it... at least for now...

Its a very unique experience for the few of us there are... I think we are in some way learning valuable lessons from this experience itself... tho dont ask me what they are....

Tom Hickey said...

The world is going through a huge transformation now, one that present immense opportunity as the developing world catches up with the developed world and huge challenges as we enter a new globalized civilization that conflicts with nationalism and tribalism.

On one hand, Trump can be seen as a reactionary (rigid) force in this dialectic. On the other, with his focus on building a better world he can viewed as a radical (flexible) force.

In his philosophy of achieving ideal society, Maharishi Mahesh Yogi elaborated on the process of developmental or evolutionary change in general in terms of "five fundamentals of progress" — stability, adaptability, integration, purification and growth.

Stability is provided in political change by reactionaries, who emphasize tradition and the status quo.

Adaptability is provided by radicals, who emphasize experiment and exploring alternatives.

The center integrates these two opposing forces into a compromise that balances the two forces to some specific degree depending on circumstances, which is adopted through the political process.

If this process driven by pruning aspects of past behavior and institutional arrangements in deemed in need of reform, then this process leads to growth to the degree that the new approach is effective.

Stability and adaptability are the dialectical forces. Integration and purification are the process. Growth is the outcome.

Obviously, the key to progress is purification. The old must die for the new to be born. Without reform, change is just more of the same dressed up differently.

The good news is that populism is about reform. The bad news for the left is that Trump represents a variety of populism of the right and for the traditional right, too, since it is heavily oriented toward the alt-right.

But this was the choice of the center that determines elections in a democratic republic.

So the best course now from the POV of analysis is to leave one's preconceptions and preferences aside and view what is unfolding as objectively as possible regardless of whether one likes it.

This process has deep ramifications not only for domestic politics but geopolitics, economics and finance. It is not possible to do high quality analysis in any of these areas independently of the others since this constitutes an interactive system in which each influences all to some degree.

Conversely, most of the analysis I am saying is just a projection of the authors' cognitive-affective bias — normative rather than descriptive. There is also a volitional bias since much that is written is performative, designed to persuade readers to change behavior and take action.

Tom Hickey said...

Correction: In "Conversely, most of the analysis I am saying"…"saying" should be "seeing."