Market Mad House

In individuals, insanity is rare; but in groups, parties, nations and epochs, it is the rule. Friedrich Nietzsche

Politics

California shows how our 21st Century Civil War will End

The polarization of American politics is not a bad thing. Recent events in California demonstrate how fast a new political majority can arise and impose its will on everybody.

A great Medium column by Peter Leyden and Ruy Teixeira uses California history to demonstrate how America’s current civil war will probably play out. They correctly noted that the situation in America resembles that in California around the turn of the 21st Century.

Here is a brief description of California politics circa 2005. A controversial; and larger than life, outsider celebrity businessman Governor promoting unpopular neoconservative fixes to the state’s problems.

A polarized state legislature that was unable to get anything done. Rampant but shallow anti-immigrant hysteria stoked by unpopular demagogic Republican politicians. Sound familiar?

Is Trump Schwarzenegger 2.0?

Here is how Leyden and Teixeira described California circa 2018: “Now the state is totally run by Democrats. All statewide offices are controlled by Democrats, and both Houses of the Legislature have Democratic super-majorities.”

Their belief is that Governor Arnold Schwarzenegger (R-Santa Monica) created the template that President Donald J. Trump (R-New York) is following today. Arnold was elected as a left-leaning reform-minded moderate; like the Donald in 2016.

The former Mr. Universe then tried to govern as a hard conservative, as Trump is doing. That failed, and led to the collapse of California’s Grand Old Party (GOP) and a Democratic supermajority.

Republicans and conservatives will not like this because California has been expanding government and taxes dramatically, since Democrats took over in 2010. For example, voters raised sales taxes and increased income taxes on everybody who made more than $250,000 a year in 2012. In 2016 the voters extended those increases for another 12 years.

There are also plans for a $15 minimum wage by 2022 in California, a high-speed rail system financed by taxpayers, and a cap and trade scheme to fight climate change. Leyden and Teixeira’s thesis is that such changes might soon play out nationwide and history is on their side.

Is California America’s Future?

Back in 1966, Californians bucked a nationwide liberal trend by electing Ronald Reagan (R-Los Angeles) governor. Just 15 years later, Reagan was in the White House and America was turning right led by California.

If history repeats itself, a left-leaning Blue Wave will roll out of California; wash over the nation, and sweep a lot of Republicans away. That wave will end the national civil war much as the California civil war ended.

One result will be a moderate Democratic president with far-left positions. For a preview of the next president see the Second Coming of Governor Jerry Brown (D-Oakland).

This should worry us because California is far from perfect. The state has serious problems and very dysfunctional politics.

California has a huge affordable housing crisis that the supposedly progressive legislature refuses to deal with. The vaunted high-speed rail scheme is a bureaucratic boondoggle that has not put a single-train on the tracks.

To make things worse, the Golden State keeps reelecting some of the most out-of-touch and dysfunctional Democratic politicians. Examples of these dinosaurs include; U.S. Rep Nancy Pelosi (D-San Francisco), and U.S. Senator Dianne Feinstein (D-California).

Lessons from the New Civil War

Leyden and Teixeira have a few lessons for the rest of us taken from California’s experiences. Those lessons include:

  • Bipartisanship does not work. For any progress to occur one party will have to win a decisive victory. As Leyden and Teixeira state: “One side or the other had to win.”

 

  • Today’s conflict like that of 1861-1865 is a clash of two very different economic systems.

  • California represents the new information-based economy driven by technology.

 

  • Other regions like the Midwest represent the old resource-based economy driven by industry.

 

  • The Civil War analogy is that the South represented the old agricultural economy driven by slavery. The North represented the new industrial economy driven by technology.

 

Civil War is Class Warfare

 

  • The Civil War is class warfare. The California Blue Wave; like the Trump movement, can be seen as a populist revolt against business and political elites.

  • The current Civil War can be seen as class warfare between rival elites. The rival elites are the technocratic entrepreneurs from Silicon Valley, and more traditional business and media leaders from New York City. Much as the original Civil War was a battle between Northern industrialists and Southern plantation owners.

 

  • If Trump follows Arnold’s trajectory he will try to turn left at some point by compromising with Democrats; backing progressive legislation, and moderating his rhetoric.

 

  • Progressives might be in for another decade in the political wilderness. It took the Reagan Revolution 15 years to march from Sacramento to the White House.

  • The political upheaval is just beginning. California’s paradigm shift began with the recall of Governor Gray Davis (D) in 2003 and continues to this day.

 

  • Progressive action in one area can stimulate innovation in other parts of society. Elon Musk was inspired to dream up the Hyperloop by news stories about the state’s dysfunctional high-speed rail scheme.

 

  • Trump’s upset victory in 2016, was just the beginning of a wave of political upheaval that might continue well beyond 2030.

Every American ought to take a look at what California has gone through this century. The Golden State’s experiences are being repeated nationwide.