Predictions
1. Sarah Palin will give an interview at the Republican National Convention in which she hints that she may well run for Senator in 2014 or President in 2016. There will be a flurry of press interest and her true believers will swoon and throw money at her PAC’s website.
2. Herman Cain will not win the Republican nomination, although he may actually win a primary or two…well, I’m not even sure about the primary part. Now that people are hearing more about the 999 Plan than its title, he may be back in the single digits by this time next week. But there are two other reasons that he won’t make it to The Show:
- Obama v Cain = Michael Jordan v Sherman Jefferson. You tell me who wins that match-up.
- Those Who Count within the Republican Establishment know that enough potential voters, when confronted with the choice between a black man and a black man, will vote for None of the Above. They know that most of that group of voters generally vote Republican. There’s a whole political strategy (called “the Southern Strategy”) built around it.
3. The Republicans in Congress will continue their strategy of blocking all legislation relating to jobs and wasting time voting on Social Conservatives’ pet peeves over and over. Reason?
- When your popular base only has one issue, you have no other way to win their favor. It’s also a good way to conceal the fact that the base their real agenda supports consists of less than 1% of the population.
- Ir’s the Economy, Stupid. By refusing to vote on jobs, or voting only on jobs bills consisting solely of tax giveaways to the wealthy, they intend to prolong the economic doldrums and increase economic dissatisfaction, in the hope that they will push Obama out of office and retake the Senate.
4. It won’t work. I know that there are plenty of AM radio listeners who bobblehead along with the notion that Republican obstructionism is all masterminded by Obama, somehow, and that voters will turn to Republicans as the party that gets things done. The basic idea is that if we vote for the people the plutocrats want to see in office, the corporate coffers will open, and prosperity return to the land in a wave of business investment. On the small scale, that would be called blackmail. On a large enough scale, it’s called Business as Usual.
It’ll be a tough sell. Enough of us remember the Bush years when Republican legislators voted themselves a three-day work week, without a corresponding pay cut. We have noticed that they have filibustered nearly every bill proposed in the Senate. And we have noticed the sort of legislation they do pass when elected: Strip workers of their rights, lower taxes for the wealthy, eliminate local government, and selectively restrict voting rights. Americans are showing signs of waking up.
5. It will be a bloody, bruising campaign, and an apparent horse race to the end. But when all the votes are counted, it will be a reprisal of Johnson v Goldwater.
6. If I miss my bet on Prediction #5, the remainder of the American Public sector will be dismantled and sold off to profit-making enterprises. Think 44 cents is too much to mail a letter? Compare it to FedEx. Think your school tax is too high? Try sending your kids to private school. Roads? Tolls. The rationale will be trotted out, once again, that private industry, by adding a layer of profit to the cost of providing a service, will be able to do the job cheaper. Sure, but only if they cut wages and increase workloads. Buyer beware.
Point of View
Just as a thought experiment, get three identical cylinders: paper towel rolls, cans of soup, whatever. Stand them up in a straight line on a table. Now get down on their level and walk around the table (or put them on a Lazy Susan, if you have one.) Looked at from one point of view, they appear to be one object. But move just a little in any direction, and you notice that they are, indeed, three separate things.
Hold that thought.
Let’s go back in history a bit. Not to minimized our grandfathers’ sacrifices in WWII, or the”self-evident” fact that our values are better than Hitler’s, or our geographic advantage, if you have to pick one thing that allowed the Allies to win, it was oil. In a giant mechanized war, we had the fuel for the war machines. The Axis ran out of gas, literally.
So what does WWII have to do with paper towel rolls ?
The oil industry was the central pillar of America’s victory and the half-century of American dominance that followed. Once the war was over, we built a brilliant and prosperous culture based upon those vast reserves. The industry made massive profits and these flowed the the shareholders. Keep in mind that most shares are owned by a tiny minority of shareholders. Fortunes were made. Those three objects: the good of the country, the good of the oil industry, and the good of the wealthy and powerful individuals who owned those companies were perfectly aligned.
But times change. In 1971 half of American oil reserves were gone. Two years later, in 1973, we experienced the first Oil Shock. That stuff we were accustomed to buying at 30 cents a gallon suddenly cost a buck, and we stood in line to get it. The table turned, and those unified objects were seen to be separate. The oil companies, with their contracts in the Middle East, still made money, more, in fact, than ever. Their shareholders made money. The nation took a bath, whether you measure that in the whupping motorists’ wallets took, the effect on our balance of trade, or the shift in power from Washington to Riyadh, Teheran, Baghdad.
The longer as the United States allows itself to be stuck in the age of oil and drags its feet in the development of renewables, the further we will fall behind, the more our ecomony will bleed, and the weaker and more dependent on the vagaries of foreign politics we will become. We cannot remain a world power when the source of the power we rely upon comes increasingly from outside our borders, when the cheap, easy-to-access-and-ship-to-market domestic reserves rapidly diminish. Even if we were to drill every inch of soil, every inch of the ocean floor within our jurisdiction, it wouldn’t be as cheap as Colonel Drake’s well in Titusville, dug by hand and its contents sold for 10 cents a barrel. Even Michelle Bachmann’s $2 a gallon target is out of reach. Prodction costs are just too high. If prices fall too far, producers will shut down supply until the prices rise enough to insure profitability.
Tomorrow NPR will air a segment on China’s bid to be the world’s dominant force in renewable energy. You can hear it between 6:30 and 7 pm on your local NPR affiliate. I urge you to listen. And while you are listening, keep in mind that all the opposition to funding for renewable energy development, all the opposition to Climate Change science, comes from the Oil Industry, and, despite their protestations of patriotism, is designed to maximize their profits and political dominance.
The Tea Party Opt-Out
I was thinking about Obama’s speech last night. I was pretty much on board with all the proposals, with the possible exception of those trade agreements, which I’ve heard bad things about. I watched Eric Cantor and John Boehner’s faces assume the “oh, we are so fucked” look. Eric seemed to have recovered his spirits by the time Fox News got a mike in front of his face, though, as he said he thought he could get some of the proposals through quickly, while he’d have to wait and see about the others. (Taking out my secret Republican decoder ring, I quickly ascertained that the tax cuts would pass quickly, while things like infrastructure projects and anything, basically, that would help the general public would be deferred to infinity.)
But there’s still that problem with the purest of the pure, those who believe that government should just curl up and die and would vote against it out of ideology, hatred of Obama, pure cussedness or because God told them to. [Or their husband. Same difference.] Yes, the Tea Party. I though long and hard and figured out a way around that. Actually, I got the idea from watching the Republican debate the night before.
Add two sentences to the bill:
- A State or Representative district will be required to “opt-in,” in order to collect Federal funds authorized by this act.
- A Representative or Senator’s vote in favor of this act will constitute a decision to opt in.
That should work. Republicans love the whole optional thing, you know, with opting in being even better than opting out. For example, states should be allowed to set their own pollution standards, unless, of course, they choose standards that the oil companies don’t like, like those hippies in California did. Rick Perry thinks states should be able to opt out of Social Security. Heck, he thinks states should be able to opt out of being states. (If Texas got its wish, I wonder who’d pay for their firefighters? Maybe he could ask the Koch Brothers to pony up.)
The more rightward-thinking Republicans also hate, just hate, hate, HATE, Federal largess. Well, unless there’s a photo-op involving themselves and a giant check involved.
So there you have it: they get to appeal to their base by voting against a landmark piece of Kenyan socialism, then putting their principles into action. What could be more ideologically pure than that?
Freedom!
“Freedom!”
-Mel Gibson as William Wallace in Braveheart
“…as we go forward, America needs to be about freedom. It needs to be about freedom from overtaxation, freedom from over-litigation, freedom from over-regulation.”
–Governor Rick Perry
“Whenever someone says to you, ‘Freedom,’ ask them, ‘Freedom from what, and freedom to do what?’”
–Edward Peter Fitzsimmons
Edward Peter Fitzsimmons wore a handlebar mustache and a three-piece suit with a heavy gold watch chain draped across the brocade vest covering his ample tummy every day that he taught English III at Northern Valley Regional High School. Back then (the late ’60′s) a very different sort of person was shouting the word “Freedom!” from the rooftops. And so, as a rather formal sort whose life was devoted to out-Britishing the British, he cautioned us: “Whenever someone says to you, ‘Freedom,’ ask them, ‘Freedom from what, and freedom to do what?’”
So I’d like to do just that. I’ve only pulled one recent Republican quote, that of Governor Perry comparing tax cuts, deregulation, and tort reform to the Civil Rights Movement, but I’m pretty sure that you can remember off the top of your head any number of Bachmann, Romney, Paul, Cain, etc, quotes featuring the word “Freedom.”
Freedom from what?
According to them, from bank regulations, the EPA, OSHA, investment regulations, the FDA, in other words, pretty much every government function outside of Congress, the courts, the police and the military. Freedom from minimum wage laws, child labor laws, Social Security, Affordable Health Care. Businesses’ freedom from liability from any damage they do to others in the course of their profit-making enterprises.
Freedom to do what?
To lower wages for the most desperate, to put children in competition with adults in the labor force, increasing the number of potential workers and driving down wages, to poison the environment and skip out on the consequent health care costs, to go back to the pre-Social Security days, when the average worker lived just months past his or her 65th birthday and the leading cause of death among seniors was suicide.
This, they submit, is a way to make America stronger. How exactly having a nation full of injured and sick people unable to afford treatment strengthens us, they’ve yet to explain. Unfortunately, logic leads to the conclusion that the old and sick are just supposed to die off, in a Darwinian survival of the fittest scenario. Maybe that’s why they keep insisting that Darwin is nonsense. Just like the Wizard of Oz kept yelling, “Pay no attention to that man behind the curtain.”
The Founders, they say, wanted this. Which Founders? I ask. The Founders from South Carolina who refused to sign the Declaration of Independence unless slavery was maintained? Or Ben Franklin who invented the volunteer fire company and the lending library? (You know, people working together for their own benefit without anyone making a profit off it.) Danged if I know.
The fault lines we are seeing now in our body politic have been there from the beginning. From the moment settlers landed in Virginia with the intention of getting fabulously wealthy. From the moment settlers landed in Massachusetts with the intention of creating a theocracy. From the moment Rhode Island seceded from Massachusetts in pursuit of freedom from theocracy. From the moment William Penn began his grand experiment in creating a society based on the principles of non-violence. From the moment Nat Turner rebelled against slavery. From the moment our grandfathers and grandmothers left the factory gates to protest inhuman working conditions.
The Founders. What about our immediate ancestors, who through our constitutional process established those protections that Conservatives love to hate? What are they, chopped liver? Or are they American citizens using the tools of Democracy to better their lives and create a more just and prosperos society?
“Freedom’s just another word for nothin’ left to lose.”
-Kris Kristofferson, Me & Bobbie McGee
Think about it.
Random Musings
Mitt Romney: “Corporations are people!”
@tfgray: Yes, Mitt, but would you want your daughter to marry one?
Moot point, he’s got all sons.
Iowa is about to cast it’s straws. Earlier prediction: Sarah Palin will take a family vacation whenever the Palin family finances run low. Oh Look! She’s going to Iowa. How long ago was her last road trip? About a month. Look for another one in 4-6 weeks.
Rick Parry has run a very smart campaign so far, showing himself to be the best of all possible options, based upon all the most successful Republican strategies:
- Sarah Palin’s will-she-won’t she fan dance to tease the crowd.
- Michelle Bachmann’s appeal to the Christian Dominionist “Slavery’s a good thing if the slaveowners are Christians” wing of the Party. (See earlier post re Republican principles–Principle #1: It’s okay if we do it.)
- Sarah Palin again, creating a New Hampshire media event to bigfoot Iowa’s media event.
- A very good good-ole-boy George W Bush act.
- A very good impersonation of Mitt Romney’s hair.
- Plus taking advantage of the notable tendency of Republicans to all jump on board for the newest kid on the block.
I mean seriously, is this guy not the best of all worlds? Except for that Rick Parry guy, of course.
Ba Ram Ewe!
Open Letter to Eric
This news report is what set me off:
“Standard & Poor’s cut the U.S. long-term credit rating from top-tier AAA by a notch to AA-plus on Friday over concerns about the nation’s budget deficits and climbing debt burden.
China — the United States’ biggest creditor — said Washington only had itself to blame for its plight and called for a new stable global reserve currency.
“The U.S. government has to come to terms with the painful fact that the good old days when it could just borrow its way out of messes of its own making are finally gone,” China’s official Xinhua news agency said in a commentary.
After a week which saw $2.5 trillion wiped off global markets, the move deepened investors’ concerns of an impending recession in the United States and over the euro zone crisis.
The source said the credit rating downgrade had added a global dimension on top of the euro zone debt issue, raising the need for international coordination.
In the Xinhua commentary, China scorned the United States for its “debt addiction” and “short sighted” political wrangling.
“China, the largest creditor of the world’s sole superpower, has every right now to demand the United States address its structural debt problems and ensure the safety of China’s dollar assets,” it said.
“International supervision over the issue of U.S. dollars should be introduced and a new, stable and secured global reserve currency may also be an option to avert a catastrophe caused by any single country,” Xinhua said.”
Here’s the rant:
Nice job, Mr Cantor. You’ve got the world’s largest creditor nation calling for your supporter’s worst nightmare, a global currency to replace the dollar as the world’s default currency. Plus “international supervision.” The credit downgrade will increase government expenses by driving up interest rates, and, of course, tax increases are, according to you, off the table. Let’s see…how to get the economy moving…hmmm…
Wait! first we’ll throw teachers, police, and firefighters out of work and destroy the right of American workers to organize. Then we’ll give our manufacturers more tax incentives to ship jobs overseas. Then we’ll cut unemployment benefits, get rid of the minimum wage and child labor laws. When the American middle and working class have been starved into submission, we’ll offer them $3 an hour to pick tomatoes…no, wait, make that a dollar a day, you know, like in the good old days before Teddy Roosevelt, when a loaf of bread cost a nickle.
Okay! Corporate profits are up, and being invested in China, Brazil, and India. Americans live in the way the Founders intended: growing their own food and hauling it to market on dirt roads, since government isn’t supposed to maintain infrastructure.
Let’s get rid of the EPA, so industry can save a buck by disposing of toxic waste in people’s lungs, intestines, and bones. Health care crisis? What health care crisis? Anyone who can’t afford a doctor or insurance on their $1 a day can pay with the chickens they are raising in their back yards. You know, just like in the days of the Founding Fathers, when a cancer diagnosis was accompanied by a bottle of laudanum and instructions to take a little nip when the pain gets too bad and plan your funeral.
High tech industry? Why bother? We’ll defund the public school system so nobody will be qualified for those jobs anyway. India’s just chock full of English-speaking geeks. Practically a dime a dozen.
All that money that came out of your payroll for Social Security and Medicare? You really think that will be there when you need it? I bet you thought your 401K was going to be there, too. And that you’d get a pension when you retired, you know, like they promised when you decided to forego that pay increase in favor of better retirement benefits. Sucker. I have a bridge to sell you. (No, seriously, it’s part of the Indiana Turnpike, sold to a foreign consortium a few years back.)
Of course this all will restore America to robust economic health, as the minimally employed will buy tons of consumer goods with the money they are simultaneously spending on food and shelter, saving for their old age, spending on private school tuition for their kids-since “vouchers” are really only discount coupons-and medical care. No, wait…the consumer market will be in places like China and India, oh, right, where the jobs went.
Wow. You’ve succeeded in outsourcing the entire country.
Except for the people.
Did you know that prior to Social Security, the leading cause of death among those over 65 was suicide?
Nice work, you piece of work.
Thought about it some more, put on my tinfoil hat, and thought about the unfolding shakedown of recent events.
- China’s asking for a global currency (presumably the renmibi). Look for the headlines on NewsMax, Drudge, and Fox to crow, “See! We were right!” Never mind that it was brought on by House Republicans refusal to do the totally normal thing of voting to raise the debt ceiling. Cutting taxes in the middle of a war (Never done before because it’s economically stupid.) =Good. Raising the debt ceiling (Never questioned before.) in the middle of a recession = Bad. How does that go? Right up there with War is Peace. Ignorance is Strength.
- Expect Limbaugh’s (et al) main talking point to be “Look what Obama did to us!” Um, who was it who started this food fight and refused to settle for anything other than running out the clock? Nevermind.)
- Look for S&P’s and China’s comments to power a blathering rush to austerity. Yes, the problem is that those who have gotten 88% of the income gain in the last 10 years just don’t have enough money. Those whose incomes have remained flat, or fallen, are just being piggies.
- The list of things that we can’t afford will encompass everything that can’t afford to have a lobbying firm represent it. It will not include subsidies to the most profitable companies in the history of the world, or military spending on unnecessary and ineffective weapons systems. (Nah, my prediction is that one or two will be sacrificed for appearances.)
- Look for the flood of ALEC-created legislation to intensify at the state and federal level, especially legislation designed to create barriers to voting for the elderly population, minorities, and the economically disadvantaged. In their heart of hearts, Conservatives know that they can’t win without gaming the system. This may sound terribly cynical, but “average” means the middle. By definition, half of any population falls below it on some measure, including intelligence. (Rupert Murdoch has made billions off this simple mathmatical fact.) In order to rule, the 1% that benefits from the destruction of the American middle and working classes only needs to persuade 50% of the electorate to agree with them, to which end they have built a massive media structure that relies on misinformation, faulty logic, and appeals to psuedo-religious fervor and base instinct. When 50% of the population can no longer be schnookered, it’s necessary to move the goalposts (i.e 60 votes now needed to pass legislation in the Senate) and shrink the pool of eligible voters by denying the vote to as many likely opposition voters as possible, by whatever means necessary.
- It’s been documented that negative campaign ads don’t so much change people’s votes as change the likelihood of the target’s supporters voting. This will be an election of unparallelled ugliness. Vast sums of money, from Even God Doesn’t Know Where will be spent.
“The Quest,” as Galadriel told Frodo, “Stands upon a knife’s edge.” So does our Democracy. There are some very odd bedfellows between these sheets. The ideologues on the Right want to prove themselves correct, no matter what the cost, including taking down the US economy. After all, in their view, their policies will work in preciesly the opposite fashion that they ever have throughout history. China will benefit greatly from the collapse of the American economy. Bedfellows! Osama bin Laden’s three goals for 9/11 were Oil at $140 a barrel, up from $28, (60% success on that) US out of Arabia, (announced 3 days before the infamous “Mission Accomplished” banner photo op. I’m still wondering what mission, other than Osama’s #2 goal was accomplished.) and bankrupting the US by bogging us down in a land war in Asia or so. That makes it a threesome with the Tea Party Right, China, and Al Quaeda. Throw in a bunch of pious folks whose fervent dream is total war in the Middle East, preferably involving nukes and men with scorpion heads, and you’ve got enough for a swinger’s party. Toss in a few of Bush’s Got-Mores, the Saints of Selfishness, who apparently won’t be happy until they’re the Got-It-Alls, and you’ve got a political daisy chain.
They all hate each other, of course, but when you have that many interests lined up, working toward the same goal, wittingly or not, we’re in for a rough ride. We’d better get up off the couch and fight politically before the knives come out. Or the guns.
Predictions
I dunno, sometimes I just can’t help myself. Here’s a quote from the Financial Times, with a link to the original article:
“The equity market’s sell-off is clearly a reaction to the intractability of Congress and the president,” said Jack Ablin, chief investment officer at Harris Private Bank. “It’s clearly frustrating investors worldwide but is ultimately a buying opportunity as this is a contrived crisis.”
Hat tip to
Alex PareeneAndrew Leonard of Salon for the quote. (Apologies, Andrew.)
Here’s a link to my post last week.
True, I came up with a different reason for Wall Street’s blasé attitude, but there’s a fundamental similarity. They’ve already figured out a way to make money off it. Buy low, sell high is a lot easier to do when everyone is bailing on their investments in order to cover the expenses that their Social Security check used to.
I’ll take half credit for that one.
I’m sticking by my prediction that Sarah Palin won’t run for president and doubling down. Watch for her to resume her political fan dance whenever the Palin family bank account runs a bit low. Remember, as long as the ostrich feathers keep moving, the audience will throw money. Once she declares, one way or the other, the show’s over.
I’m also sticking with my prediction that Rick Perry will run. Look for lots of camera crews shooting footage of cheering crowds at the big tent meeting in the stadium. It’ll make great campaign ad footage. Much better than 50 reporters and one’s immediate family watching you stand in front of a boat in front of the Statue of Liberty (which, according to one of the invited clerics at Perry’s event, is a pagan goddess, although not the one that schtupped the Emperor of Japan.) I thought Perry might announce his candidacy at the conclusion of the event, after the revival preachers have the crowd whipped to a frenzy, but he says it’s a non-political event. I dunno, is it really a political act to announce your candidacy if Jesus told you to do it?
I’m waiting for a reporter or town hall participant to ask Michelle Bachmann if she will abandon her God-mandated obligation to obey her husband’s direct-from-the-Divine marching orders if she is elected President. Not holding my breath, exactly, but thinking that it might be a good question to ask, as she’s telling us that her husband and his rather retrograde opinions are irrelevant so far as her campaign is concerned.
One more thing: as much as I would like to see Obama on the tube at 9 pm, August 1, announcing that the lack of a debt ceiling increase has forced him to invoke the 14th Amendment, I feel that it’s more likely that Dems and Republicans will unite to throw whichever constituency they feel is least powerful under the deficit reduction bus. However, it’s important to remember that pretty much everyone, no matter how powerless, has some family member that would be forced to take them in well before November 2012 if their benefits/paycheck/earned income credit dried up and blew away. Those who don’t may well resort to vagrancy or petty theft at a time when, thank you Republicans, police budgets are being savaged.
Be afraid, oh politicians, be very afraid. Be careful what you ask for.
You might get it.
Why the Markets Aren’t Panicking
Consider this possibility:
The government is about to get another $2.4 trillion added to the debt limit with no tax hit to the wealthy and a guarantee that we’ll go through another one of these roller coaster rides again in about 3-6 months. Moody’s has warned that the threat of another round of Republican Russian Roulette in the near future will lead to a downgrade of the constitutionally impeccable US credit rating, meaning higher interest rates for all. Under classical economic theory, this is bad for business. Higher borrowing costs mean lower profits. Boo! Hiss!
But this theory forgets that the #1 industry in the country is now Finance. People who make money by shuffling money around. So how will a rise in interest rates work?
- Interest rates rise, allowing rates to go up on your adjustable-rate mortgage, credit cards, and any future debt you might take on. This makes it more profitable to lend, especially if you can simply jack up the rates on existing loans, rather than put capital into new loans. Winning!
- There will be an additional $2.4 trillion available to invest in. And, coincidentally, there’s over $2 trillion in profits sitting in corporate coffers. So do you loan it out to Uncle Sam at a newly-attractive rate, or go through the bother of hiring those pesky workers who keep whining about earning a living wage and getting their kids to the doctor? No brainer. Winning again!
- But don’t expect lending to loosen Mr. Small Businessman. Let me think…should a bank loan money to your shaky little start-up when it could get more with less risk by lending it to Uncle Sam? Main St 0, Wall Street 2.4 trillion. Winning!
- The Fed will continue to loan mega bucks to bank holding companies at .01 something-something percent, which can then be rolled right back into T-bills at a newly-increased return, paid for, of course, by the taxpayer. Doncha just love the free market?
Yes, and in six months, the Tea Party will stage another tantrum. What will be their next target? Social Security, Medicare, and Medicaid have been on the conservative hit list since about 1934. A 9% tax cut for the top and 2% increase for everyone else is also in the cards, according to Paul Ryan’s plan.
Unfortunately we of the under $250K bracket have a guy negotiating on our side whose first move in every hand of poker is to discard his aces. Compromise, shmompromise. Pick the ace back up, Obama. Invoke the 14th Amendment, article 4, “The validity of the public debt of the United States…shall not be questioned.” Dare them to impeach you for following the Constitution.
Stay tuned.
Am I better off than I was 8 years ago?
Well, yes, I am. Did George Bush or government fiscal policy have anything to do with it?
Probably not.
Eight years ago, I was supporting 3 kids. Now they’re grown and supporting themselves.
Eight years ago, my mortgage was around $70K. Now it’s about $13K. Turns out my employer shut down my workplace in 2005. I had to choose: move with my job or stay where I was and find a new one. As it turned out, my job moved to Oregon, a place I’d visited 25 years before and loved. I sold my house, the timing controlled by my workplace closing and my daughter’s graduation. As it turned out, June 2005 was the top of the real estate bubble.
The criteria for the new place were (1) no more than a $25K mortgage and (2) no more than 5 miles from work. We downsized into a smaller house on a smaller lot in a cheaper neighborhood 3.3 miles from my job and 3.5 from my husband’s. (Our previous commute was 40 miles a day each, in opposite directions. )
We always gardened, but now we are more interested in maximizing yields and putting up produce. The new place has an apple and a plum tree, and we’ve planted two dwarf pears. Our next major investment will be $200 for a small chest freezer, and in the spring, about twice that for a lean-to greenhouse for the south side of the house. Our first major investment, which we paid off this month, was upgrading the windows to state of the art. We use about half the firewood of other households in our neighborhood.
Yes, firewood. We couldn’t heat with wood in the old house, but this one has a fireplace with a fairly efficient insert, definitely a selling point from our perspective. Since my husband works in landscaping, wood follows him home (in the back of his pickup truck) on a fairly regular basis. As in the previous house, we have a timer on the thermostat. The furnace kicks on just before I get up, and kicks off an hour later, when my husband waltzes out the door to walk the dog. Whoever gets home first starts the fire.
The rest of the time, the thermostat is set at 60 degrees. During cold weather we bank the fire at night. Daytime, we open the shades on the south side in the winter; we close them in the summer. When it’s hot, we use fans rather than air conditioning. The windows keep the temp consistently 19 degrees cooler than the outside temp. In cold weather, the furnace, outside of that one hour in the morning, comes on infrequently. Our worst natural gas bill so far? $62, in February ’06, the month that natural gas prices mysteriously doubled. (Just for comparison, the monthly bill in the summer, when only the pilot light runs, is $16. There’s a minimum fee and some taxes and whatnot that account for much of it.)
Eight years ago, in a house heated with oil–the price of which has nearly quadrupled since–we ran about $300 a year. Our oil company would sell contracts. We would estimate how many gallons we needed, pay our heating bill in July and then settle up for the difference the following spring. The company stopped offering contracts in 2004. Oil prices had gotten too volatile and they could no longer guarantee the price.
Am I doing better? Yes, I think I am, but I’ve been lucky. Without that fortuitous job-related move, I’d be looking at making mortgage payments until I was 82. My husband and I would be burning about 3 gallons of gas a day between us, instead of 3-4 a week total. My home heating bill would be at the mercy of Big Oil, speculators and Arabs.
I’m lucky. My kids are a blessing. Every day at work I hear co-workers talking about their kids’ problems with school, drugs, the law, and whether they’re on the right meds. Mine, knock wood, are doing ok. Luck has a lot to do with my being better off, as does making every effort possible to conserve energy and become self-sufficient in food and energy.
Some people wouldn’t see me as being better off. I’m in a smaller house in a more modest neighborhood, driving a used compact car. I get my hands dirty in the garden and slice and dice and pickle and stew. I sweat and watch my hair frizz as I put quarts of dills and bread and butter pickles in the hot water bath. I stack firewood while my husband swings an axe. To some people, this is a giant step backward, a fearsome reversal of the eternally upward trend of the American economy.
To me, it’s just that the lifestyle I’d aspired to, so demonized as “Hippy” in the Sixties and Seventies, happens to be working out just fine.
Mo’ Betta Bailout
Latest news from our running economic soap opera, As The Street Churns.
Hank Paulson told the Senate Banking Committee today that no mention of oversight was made in his back-of-the-napkin plan to Save the Economy because he “wouldn’t presume” to dictate terms to Congress… except for those 32 inconvenient words where he specifies that there will be no oversight. Tony Fratto, over at the White House, claims that Paulson’s cocktail napkin had been sitting there for several months, but somehow, (seeing as Everything Is Fine and Nobody Saw This Coming) they only saw fit to share it with Congress after the largest players in the economy started tumbling like bowling pins. Oh, and this is so important that Congress had better pass it RIGHT NOW, or else We Are All Doooomed and it will be all your fault! You know, sort of like how you better buy that house RIGHT NOW before you get priced out of the market.
And don’t bother reading the fine print. It will only confuse you.
So, if this was not a long-planned event, why was the plan written ahead of time? If they didn’t think they could force a gigantic liar’s loan on taxpayers by presenting it as the only, desperate, last resort during a crisis that could Take Down the World, why hold off until the crisis occurred? I’ll say it again. This is an attempted takeover of the US, and perhaps the global, economy. It’s a scam.
And there’s something else that’s set off my crap detector: Fox News is acting like nothing’s happening on this topic. Every time I surf past O’Reilly, Hannity, et al, they’re having trivia contests and chit chat. Why would it be in the interest of an alleged news organization to miss the biggest story of the year, maybe the decade?
Any thoughts?
Here’s a little something my son showed me over at Cracked:
So if somebody wants to bypass your critical thinking circuitry, all they need to do is make you scared or anxious, often with a time limit or urgent threat (“We need to act now, or lose our way of life!”).
Instead of pondering the situation with the analytical neocortex, you’re using the primitive limbic system, scanning the landscape for the “Right” and “Wrong” move. You’ll have no patience for wishy-washy talk about “a spectrum of options.”
http://www.cracked.com/article_16656_6-brainwashing-techniques-theyre-using-on-you-right-now.html
Deja Vu, All Over Again
My parents were old enough to remember The Great Depression. Unlike the other kids in my neighborhood, whose parents had been born a decade or more later, I grew up at the dinner table hearing tales of the Stock Market Crash and how my grandfather, a stone setter in a jewelry factory, lost his job shortly thereafter. My mother went to work at age 15, as a legal secretary in the Essex County Court House in the neighboring city of Newark, NJ. She got to keep $5 of her pay each week to cover trolley fare and other necessities. The remaining $10 went to her parents to keep things going. A couple of years later, at age 9, my uncle got a job, too. He set pins in the local bowling alley for a few hours each evening, and lost some of his hearing in the process.
Oh, look! It’s happening again.
I can’t remember who said that “those who ignore History are doomed to repeat it,” but it seems like a sensible thought, so let’s look at History.
In the Roaring Twenties, the Free Market ruled. You could buy stock on margin, meaning that once you owned some stock, you could buy more by borrowing against the value of your existing stock. Buy 100 shares, borrow against them, and buy 90 more. The system worked, like all good pyramid schemes, so long as everyone was confident that it would work. In September 1929, the biggest of the big boys started pulling their money out of stocks. It didn’t affect prices. Everyone else was in a frenzy to buy up whatever they could before they got priced out. The market continued to rise.
Then, in October, there was a “liquidity crisis.” Banks stopped lending. With margin no longer available to fund buying, and the major investors sitting on their cash, the market began to deflate. If you’ve borrowed against the value of your stock and that value goes below the amount you owe, you have to make up the difference by either adding more money (which many didn’t have as it was all invested) or by selling enough stock to make up the difference. All sellers, no buyers? You get a spiral to the bottom as the whole house of cards collapses.
President Herbert Hoover was shocked. Had not a book come out just the year before, written by a respected economist, saying that the stock market could not possibly go down? He turned to his advisors, notably Henry Morgan, grandson of the legendary investor J.P. Morgan, (and co-founder of Morgan Stanley) for advice and was told that this was a necessary market correction and he should let it run its course. In due time, capital would return from “those who don’t know how to use capital productively” to those who did, i.e. Morgan and his friends.
We all know how that turned out. The Depression worsened. 25% of the American workforce was on the street. The Republicans were routed at the next election and Franklin Roosevelt and the Dems in Congress laid down a set of rules that protected ordinary investors and prevented the sort of meltdown we are seeing now.
Until Reagan, who stood everything on its head. You see, we’d be that much more prosperous, if only those pesky New Deal rules could be dispensed with. You’d think he’d have known better. After all, he was old enough to remember the Depression. Of course, for him, the Depression wasn’t quite the argosy it was for my family. His dad had a steady government job with one of FDR’s alphabet soup of bureaus. He got a football scholarship and went to college.
At the time, it reminded me of my high school English teacher, Edward Peter Fitzsimmons, with his handlebar mustache, three piece suit draped with a gold watch chain, and ponderous pronouncement, “When someone says ‘Freedom’ to you, ask them, ‘Freedom from what and freedom to do what?’”
Ah, Freedom.
In the case of Reagan’s supporters, it meant freedom from the pesky regulations that kept them from reinacting the Roaring Twenties and Crash of ’29, complete with a respected economist predicting that the Dow would reach 36,000. But they were a dedicated bunch. They began with the Savings and Loan industry, took it down in the late ’80s, and sucked massive amounts of taxpayer loot to cover the bad loans they had written for each other and defaulted on. (Google Neil Bush and Silverado for a notable example).
Then the wall between Main Street Banking and Wall Street Banking came tumbling down, weakening one of the protections against another Great Crash set up during the Depression. But hey, we’ve got the FDIC, remember? So if it all turns sour, we’ll be insured.
Let me enlighten you. FDIC is an insurance fund, paid into by the banks. It runs on the assumption that all the banks will not fail, and certainly not at the same time, just like auto insurance companies run on the assumption that every car will not be totalled on the same day. Think about it. Do you really think that the FDIC has funds equal to all deposits in all American banks on its books? It’s a fallback mechanism designed to cover worst case scenarios in a generally well-regulated environment. If you weaken the regulations, you get more worst-case scenarios, and those worst cases get a lot worse, if you catch my drift.
Perhaps you remember a few years back, how investment bankers were relentlessly promoting stocks that they privately referred to as “dogs.” Ah, freedom! Actually, it sort of built into the system. Several years ago, I began studying for my Series 7 (stockbroker’s license) I stopped when I got to the following. If an IPO is not selling out, there is only one way to promote sales: you can’t drop the price; that’s locked in by contract. You can’t give away toasters. The only legal thing you can do is increase the commission to the brokers selling the shares to their clients. So buyer beware. The more your broker is hyping something, the more likely it’s a dog.
And then there’s the Enron Exception. Phil Gramm, having single-handedly destroyed the S&L industry with the Gramm-Leach-Bliley Act (okay, he had help) now turned his sights to the commodities market. In 262 densely-packed pages that he literally had an aide drop into the text of a larger piece of legislation the night before it came to a vote, he repealed all regulation on energy trading, leading bright young traders to chortle that they were ‘sticking it to California Grannies up the a**,” or words to that effect. Coincidentally, [irony here] his wife was named to the Enron Board of Directors 5 weeks after the bill passed. Senator Gramm now advises both the Swiss bank, UBS, and John McCain’s presidential campaign. (They did have to put him in the closet after that “mental recession/whiners” gaffe, but he’s still apparently in the running for Treasury Secretary, should Mc Cain prevail at the polls.)
Ok, where were we? Yes, watching Paulson and Bernanke doing their Burt and Ernie show in front of the Senate Banking Committee. Watching the smartest guys on Wall Street plead the case that everyone else should pay for their arrogance and greed, simultaneously insisting that they were too stupid to see it coming and the only guys smart enough to fix it. Watching them demand $700B in ransom money for the economy they are holding hostage. Fix Wall Street, they say, and everything will be fine.
For them. Keep in mind that the real crisis is foreclosures. Wall Street’s crisis is based upon the fact that they bought up a bunch of loans to people who couldn’t afford to repay them. Handing off cash will solve the current “liquidity crisis” (at least until they figure out a way to snort $700B up their noses) but leave the underlying problem untouched.
Here’s an alternative proposal: Work out a temporary deal to restore liquidity (a fancy name for trusting someone enough to loan them money). Then start from the bottom up. Comb through those stinky, mucky mortgages. Do what can be done to keep people in their homes and prevent an even worse crisis as waves of foreclosures crater the housing market. Perhaps that means freezing adjustable rate mortgages. Put people who only own their residence at the head of that line and let those who drove up the market by playing Monopoly with real houses cool their heels. Go after the brokers who wrote the liars loans and fine them, using the proceeds to fund the process of fixing the mess. Work deals so that those who are hopelessly over their heads can, perhaps, get out of their mortgages and become renters, staying in the same home. (I don’t know how that would work in practice, but it’s a thought.) Unravel those massive CDOs and CMOs and figure out just which mortgages are in which bundle, then let Mr. Market figure out what they are actually worth. More work than writing all those zeros on a check, but probably worth it.
Whatever you do, don’t get fooled again.
Of Spinal Regeneration and Chickens
Whew! There’s a mixed metaphor. Let me ‘splain. It appears that the Dems are showing sign of a spine, triggered largely by the Bush Administration’s chickens coming home to roost. Despite the best efforts of Bush, Cheney, McCain, Palin, Paulson and Bernanke to panic the American people into a run on every bank in the country with their use of the words “panic,” “depression,” “rescue,” “crisis,” et al, the majority response seems to be, “Gee, this feels a lot like the run-up to the Iraq War.” The members of the House and Senate, Repubs and Dems alike, are standing firm, as well they must.
Here’s an item from Mother Jones, written by Naomi Prins, formerly a managing director at Goldman Sachs:
But even as Capitol Hill debates TARP [Troubled Asset Relief Program], few seem to have noticed the proposal item that puts taxpayers on the hook for future bailouts. It’s in Section 6, and the key phrase is this: “The Secretary’s authority to purchase mortgage-related assets under this Act shall be limited to $700,000,000,000 outstanding at any one time.”
What does “at any one time” actually mean to economists? It means that if everything we American taxpayers buy re-evaluates down to zero, we get to buy more. That’s hardly taxpayer “protection.” With several hundred billion dollars of write-downs already announced this year by the part of the industry compelled to post their losses, it’s a safe bet that $700 billion worth of the junkiest assets in existence will be heading to zero the second they are purchased.
http://www.motherjones.com/commentary/columns/2008/09/the-bailout-plans-fine-print.html
Yes, you heard that right. At any one time. Call your Senator, quick!
{note: on Chris Matthews’ show today, Jim Kramer was virtually salivating over the notion that this $700B investment could possibly turn a $200B profit, once everything stabilizes. Or lose $200B of taxpayer geldt. Cheap in his estimation. They won’t all go to zero, he maintained.]
And here’s another minor technicality: Under Paulson’s plan the job of sorting out who owns what and what it’s worth will be subcontracted out to [drum roll please] Goldman Sachs and others of the firms that created them.
Government contracts. Where have we heard that before?
Seriously, call your Rep and Senators. Make sure they read all the fine print.
Straight Talk Express Makes Hard Right, Runs into Waffle House
Hoo, boy! John McCain appears to be running a parody of a political campaign. Here’s my prediction: within two years there will be a comedy film about it. It will consist of actual campaign footage intercut with dramatized scenes of the backstage workings of the campaign. Tina Fey will, of course, play Governor Palin. Richard Dreyfus would be my pick for the top of the ticket, with Morgan Fairchild as his lovely wife. The campaign advisors will be played by Cheech and Chong.
You read it here first, and I want royalties.
Another Day, Another Crisis
We have an agreement on the bailout! We’re saved!
No, we don’t. We’re dooooomed, well maybe not so much.
What’s up with that?
I’m sticking by my original intuition: it’s a scam. Amazingly, I am not alone in this opinion:
Paulson Bailout a Historic Swindle http://www.thenation.com/doc/20081006/greider
Stop the music, so to speak, instead of allowing individual financiers and traders to take opportunistic moves to save themselves at the expense of the system.
And here’s an article by James K. Galbraith, who doesn’t state things as baldly but offers a more reasoned analysis of the plan. Cliff notes: The bailout is badly thought out and largely unnecessary.
http://www.washingtonpost.com/wp-dyn/content/article/2008/09/24/AR2008092403033.html?nav=slate
Galbraith points out that the basic problem is that the mortgage market became totally corrupted and the problem lies within the mortgages themselves. The notion that these “vehicles” are “too complicated” to unravel is nonsense. People make their mortgage payments and somehow those payments make their way to the correct investors. The notion that the whole thing can’t be unwound and the soundness of each mortgage determined is just not going to fly.
No, the solution lies, like the solution to so many other scandals these past eight years, in old-fashioned law enforcement. Were there abuses? You betcha! From the liar’s loans on the wrong sides of so many tracks to the speculators leveraged up the wazoo, playing Monopoly with real houses, right up to the boardroom, with plenty of retirees looking for safe investments getting schnookered in the process. The notion that the problem can be solved by bailing out the top of the food chain and sweeping the rest of the mess under the carpet is pure gobbledygook. For a more technical analysis, see Martin Wolf’s article in the Financial Times.
http://www.ft.com/cms/s/0/a09b317e-898d-11dd-8371-0000779fd18c.html?nclick_check=1
But let’s look into the political fallout. In the face of this economic disaster, John McCain’s response began with denial, then partial acceptance, then a desire to jump into the middle of it coincidental to finding an excuse for a bailout of his own, bailing out of Friday’s debate. I tend not to go for economic or political analysis on these things, but look for the underlying psychological logic.
The whole basis of NeoCon thought lies in the concept of short-term gain. At Harvard, back in the 50s, when the concept of the Masters of Business Administration was first hatched, one early research finding was that steering by short-term considerations (such as measuring your success by each quarter’s earnings report) would be more profitable than employing a long-term strategy. Basically, your profits would compound faster. Another tenet of the MBA religion is that you need to privatize your profit and externalize your risk.
This is the thinking that led to Paulson’s plan. Profit is retained for the giant brokerage houses and the risk offloaded to the taxpayers. This is also McCain’s logic. Campaign’s in the doldrums. Hey! Let’s nominate that hot babe from Alaska! Ooops! She doesn’t just look like a Barbie doll…Quick, Robin! The Batmobile to Washington! Then he plots to seize the high moral ground by “suspending his campaign” without actually stopping anyone from campaigning on his behalf. I can imagine the debate, if he does actually show up. “Oh, look Barack! A bird just buzzed your head!” McCain specializes in short-term strategies to leapfrog himself from crisis to crisis. As the editor of The Nation said on Countdown tonight, “McCain’s gone all in, betting on the stupidity of the American people.”
Don’t laugh. Rupert Murdoch’s been betting on that for years and winning billions.
There’s a traditional name for short-term thinking. It’s called “cleverness.” Remember that the next time you hear the phrase “the smartest guys in the room.”
There’s a traditional name for long-term thinking, as well. It’s called “wisdom.” We could use a few wise men and women. I’ve had it with the wise guys.
The First Debate
Well, if you’ve read my previous posts, you’ve probably figured out that I’m rooting for Obama, but contrary to my hopes, and John McCain’s pre-debate victory announcement (released even before he agreed to show up, can you believe it?) I’d have to call it a draw. Obama looked relaxed and in control, as always. McCain flashed that shark-toothed grin on more than one occasion, and refused to look at his opponent. They both scored points.
I think Obama could have scored more.
- He could have pointed out more forcefully that McCain’s call for regulation on Wall Street comes only after the deregulation he championed for decades has nearly destroyed the banking system.
- When McCain went on about how well he would care for veterans, Obama could have mentioned McCain’s rating from the Disabled American Veterans (DAV), as compared to his own. McCain voted against bills favored by the DAV 16 times, with 11 votes in favor and 5 unrated. Obama voted against their positions once, in favor 17 times, with one vote unrated. However, veterans organizations are picking up that dropped stitch.
- When asked by Lehrer about spending cuts that would be forced by the bailout, Obama could have made a stronger case that the areas he wants to increase spending on are investments that will strengthen the economy and that the dangerous mismanagement of the past 8 years has jeopardised our ability to create a better future. He could also have mentioned that no one really knows if the bailout will actually cost $700B or $100B or even $1.8T, or, after all the shouting is over actually turn a profit, and whether that profit will go to the taxpayers or into the pockets of a few corporations, as the details have not been hammered out. The end result, “too soon to tell” may have been the same, but it would have looked more reasoned and less evasive. McCain, of course, has no problem with cutting anything, ever, regardless of the consequenses.
- I think Obama tried to call foul on McCain’s support of nukes, given the senator’s consistent record of supporting nuclear power and waste disposal so long as it stays outside of Arizona, but McCain talked over him, a tried and true tactic of the Right.
The early polls, meanwhile, are showing a boost for Obama. Maybe I’m just too picky, (McCain neither lapsed into a bleepable tirade nor ran from the podium in tears) maybe the Republican psy-ops strategy of the “victory ad” hasn’t taken effect yet.
Or maybe you really can’t fool all the people all the time.
Stay tuned.
Bailout Reboot
Despite John McCain’s heroic use of the Batphone, the Bailout bill failed. A substantial minority of Dems voted against it on principle. A substantial majority of Republicans voted against it, some on principles that may have been similar to or the polar opposite of the Dems, and a round dozen we are told, because their feelings were hurt by a girl.
Although I work in the banking industry, at the bottom end of one of those institutions that are in danger of becoming extinct if something isn’t done, I was relieved. Let’s forget about the original fox-in-the-henhouse Paulson version of the bill. Let’s forget about making cosmetic changes to something designed to save the butts of hedge fund managers by tossing in a few crumbs for the rest of us. Let’s start over. Oddly, we don’t have to start from scratch.
I can’t claim credit for this. I found it posted in a comment by Christian to a Mother Jones article:
If the current credit crisis stems from the collapsing housing market, it makes sense to stabilize the housing market. Fortunately, we already have a historical model to accomplish this. Among his many New Deal reforms, FDR created the Home Owners Loan Corporation. The government can purchase all foreclosed properties and mortgages approaching foreclosure and reset the mortgages at a more reasonable rate. Properties which are already foreclosed can be refurbished to ensure better long-term value, including such energy efficient upgrades as solar water heating panels and improved insulation. Properties beyond redemption can be destroyed, and the property used for newer, better housing or other appropriate use at market prices.
The cost? With the current foreclosure rate at around 2.03 million houses, and a median house price of 200K, the taxpayers will have to pony up about 421 billion dollars. Throw in another four billion to cover administrative costs and property ugrades, and it’s still a bargain at 425 billion. This plan has the advantage of allowing people to remain in their homes and pay their mortages, creating additional jobs through improvement of housing stock, and ensuring that the money spent by the taxpayer is used in a manner that is well-observed and grounded in real values, not hazy market derivatives. Historically speaking, the HOLC of the New Deal even turned a small profit.
There will be some who argue that allowing “irresponsible” homeowners to keep houses they could not afford risks creating a moral hazard. To help avoid this possibility, the program could be restricted to primary residence to ensure it is a homeowner’s program, not a tool for speculators flipping properties. But in any case, don’t we risk a moral hazard on a much greater scale by bailing out Wall Street speculators and billionaires with little to no oversight?
Main Street needs a fair deal. Wall Street has had things more than fair for the past three decades, and they blew it. Enough of that failed model already.
I’ve already copied and pasted this into an email to the Obama campaign, where it is no doubt sitting in their capacious inbox waiting to be read by a volunteer while negotiations proceed apace on Capitol Hill. Stronger measures are needed. This plan makes sense, and needs to be added to the debate. Want to help?
Here’s why I think Obama and the Dems need to take up this proposal and desist from anymore of this “bipartisan” schtick.
- This plan is a proven entity, having provided major relief during the last depression and actually paid for itself and then some.
- This plan addresses the root of the problem: the crumbling housing market, while allowing the guys who made fortunes off the return side of the risk/return equation to accept that good old free-market risk. (There should also be investigations and accountability for the scammers. The problems of small investors having bought into these atrocities should also be addressed, but in a separate bill.)
- This plan fits in well with Barack’s alt energy and green jobs planks and could actually kick start the retrofitting of America. My friend Steve Hegedus from the University of Delaware’s Solar Research Center has long maintained that the only thing holding back solar is lack of enough demand to introduce economies of scale that would bring prices down.
- In addition, the reference to FDR would allow Barack to address that “elitism” thing, perhaps with the Gumpish phrase, “Elite is as elite does.” The Right has long pulled votes via a phony populism based on the fantasy that you, too, the hard-partying, slidin’ by C-student could become president, even if your daddy were not a politically connected millionaire, so why not elect someone like you, not that nerd who actually learned stuff in school. FDR was a card carrying member of the Elite, scion of a family already wealthy by the time of the American Revolution, Yale grad, former Secretary of the Navy, cousin of a legendary former president, governor of a certifiably Eastern Establishment state, New York. Then tragedy struck. He went to bed one night and woke up unable to move his legs. Polio, then a common scourge, had laid him low. His efforts to recover sent him to a sanatorium in Warm Springs, GA, where 99% of the patients were, well, from the other 99% of America. Unlike his social classmates, he got to know and befriend ordinary people, and this connection sustained him when his peers demonized him for the New Deal. I’m sure a researcher could come up with any number of Depression-era quotes that sound remarkably similar to recent Republican pronouncements.
- Obama could also make parallels between the Republican economic policies in the Twenties and their reinstitution since Reagan.
- He could point out that Lassez Faire capitalism has historically led to and endless cycle of booms and busts, and that as much as Conservatives hate regulation, wise regulation actually functioned to establish trust in the financial system and keep the economy on an even keel for the better part of a century. He could point out that the current crisis is living proof of this.
- It would answer John McCain’s dare, that Obama has nothing to offer, unlike McCain, who offered more tax cuts for the rich, protection for exorbitant executive pay for incompetence, and federal insurance for the junk paper, which would bring its nominal value back up to 100% (Hey, it’s insured. It’s safe! ) This last would essentially reboot the scam.
- Continued attempts to bring Republicans on board give them enourmous power, and they already have a proven track record of abusing that to feather their own beds.
The alternative is a continued attempt by Dems to entice the Republicans to cover their butts by voting with them by including their poison in the eventual bill. There are enough Dems to pass a good bill along partisan lines, and probably enough Main Street-oriented Republicans to provide a cushion, but we’ll have to act fast. Other proposals are already in play. We’ll need a groundswell of support to get this to the table.
Call your Representative. Tell them about this proposal. Do it now. If the line is busy, keep trying.
Nancy Pelosi (202) 225-0100 Barney Frank (202) 225-5931 Rahm Emmanuel (202) 225-4061
Barack Obama (202) 224-2854 Joe Biden (202) 224-5042
Capitol Hill Switchboard (202) 224-3121
House member links http://clerk.house.gov/member_info/index.html
Senate member links http://www.senate.gov/general/contact_information/senators_cfm.cfm
What Mortgage Meltdown? The End of Smoke and Mirror Economics
Let’s start with a comment from Polixian to a previous post:
This should give responsible media outlets a greater opportunity to point out the history of how it is our economy got to where we are…beginning with the Community Reinvestment Act of 1977 (President Jimmy Carter); the push by the Clinton Administration to force sub-prime mortgage lenders to expand their offerings into under-qualified, high-risk groups; the money trail of industry lobbyists (esp. Freddie Mac, Fannie Mae) and their political allies (esp. Frank, Dodd, Obama, and other republicans as well); and, the efforts by the aforementioned, as well as Maxine Waters and Pelosi, to protect such industry practices via outspoken congressional opposition to reform measures.
Ok, I admit I started it, by thinking that the Bushies had pushed this to bring the maximum amount of sheep in to be fleeced by predatory lenders. It was the Liberals that started this. However, here are a couple of details that have come to my attention:
Polixian echoes the Right Wing charge that Liberal policies have forced banks to make loans to people who could not afford the payments. It is soundly rebutted here:
http://www.snopes.com/politics/obama/loans.asp
The landmark case, Buycks-Roberson v. Citibank Fed. Sav. Bank was about the bank’s refusal to make a loan to a Black woman while granting loans to whites with similar income profiles. The lawsuit sought to end redlining, the practice of refusing credit to individuals based upon their neighborhood, regardless of their ability to repay.
I spoke with Michael, my go-to-guy at work, a second-generation bank consultant, who told me he ran the math and figured out that the $700 billion figure for the bailout was based upon 7% of the $10 trillion mortgage market going south, of which $0.5 billion represents those nasty, evil, ACORN-inspired subprime loans. Po’ folks taking down the global economic system? Not hardly.
Then I ran across this, at http://www.webofdebt.com/articles/its_the_derivatives.php
What had to be saved at all costs was not housing or the dollar but the financial derivatives industry; and the precipice from which it had to be saved was an “event of default” that could have collapsed a quadrillion dollar derivatives bubble, a collapse that could take the entire global banking system down with it.
Michael puts the total US derivatives market at $180 trillion, or about 18% of the global total, and notes that the entire GDP (Gross Domestic Product) of the entire world is a measly $70 trillion. Yeah, you read that right: the derivatives market is about 14 times the entire annual income of the entire world. OK, so what’s a derivative?
Essentially, it’s a bet. Again, from Ellen Brown, who explains this stuff so clearly:
Derivatives are financial instruments that have no intrinsic value but derive their value from something else. Basically, they are just bets. You can “hedge your bet” that something you own will go up by placing a side bet that it will go down. “Hedge funds” hedge bets in the derivatives market. Bets can be placed on anything, from the price of tea in China to the movements of specific markets.
“The point everyone misses,” wrote economist Robert Chapman a decade ago, “is that buying derivatives is not investing. It is gambling, insurance, and high stakes bookmaking. Derivatives create nothing.”1 They not only create nothing, but they serve to enrich non-producers at the expense of the people who do create real goods and services. In congressional hearings in the early 1990s, derivatives trading was challenged as being an illegal form of gambling. But the practice was legitimized by Fed Chairman Alan Greenspan, who not only lent legal and regulatory support to the trade but actively promoted derivatives as a way to improve “risk management.” Partly, this was to boost the flagging profits of the banks; and at the larger banks and dealers, it worked. But the cost was an increase in risk to the financial system as a whole….2
Credit default swaps (CDS) are the most widely traded form of credit derivative. CDS are bets between two parties on whether or not a company will default on its bonds. In a typical default swap, the “protection buyer” gets a large payoff from the “protection seller” if the company defaults within a certain period of time, while the “protection seller” collects periodic payments from the “protection buyer” for assuming the risk of default. CDS thus resemble insurance policies, but there is no requirement to actually hold any asset or suffer any loss, so CDS are widely used just to increase profits by gambling on market changes. In one blogger’s example, a hedge fund could sit back and collect $320,000 a year in premiums just for selling “protection” on a risky BBB junk bond. The premiums are “free” money – free until the bond actually goes into default, when the hedge fund could be on the hook for $100 million in claims.
And there’s the catch: what if the hedge fund doesn’t have the $100 million? The fund’s corporate shell or limited partnership is put into bankruptcy; but both parties are claiming the derivative as an asset on their books, which they now have to write down. Players who have “hedged their bets” by betting both ways cannot collect on their winning bets; and that means they cannot afford to pay their losing bets, causing other players to also default on their bets.
The dominos go down in a cascade of cross-defaults that infects the whole banking industry and jeopardizes the global pyramid scheme. The potential for this sort of nuclear reaction was what prompted billionaire investor Warren Buffett to call derivatives “weapons of financial mass destruction.”
[This might be the time to mention that W's brother Marvin runs a hedge fund, Winston Capital Management, but I digress.]
So, what did that $700 billion buy us? Damned if I know. The credit market is still seized up, since the dominoes are still a-tumblin’ and $700 billion, as impressive as that string of zeros is after the 7 looks, is only .00000004 of the value of the total derivatives market.
And the most interesting part, as Brown points out, is that “Derivatives create nothing. They not only create nothing, but they serve to enrich non-producers at the expense of the people who do create real goods and services.”
So essentially, derivatives are fluff, wispy critters of air, the foam on the economic beer, so to speak. with as much intrinsic value as the average casino chip. And yes, there are people who have profited most handsomely from them. What to do? Soak the Rich? That would be nice, but the problem is that down the line the real money underlying the cotton candy is your IRA, my 401-K, and Mrs. McGillicutty’s annuity.
Exactly how do we untangle this? How do we blow the foam off without spilling the beer? Nothing jumps off the top of my head, but I’m putting on my thinking cap, and I hope you will, too.
The Whited Sepulcher
A few years ago, when I lived in Elkton, MD, I got to chatting with a fellow on the road crew fixing my street (after years of potholes, busted water mains, cheap patches, and neighborhood complaints). He asked me what I thought of the Bush Administration. That can be a loaded question in Cecil County, MD, a finger of Appalachia poking into the eye of the Eastern Seaboard, so I answered carefully. “I think the country’s being run by a bunch of whited sepulchers,” I said.
He nodded. “Yep,” he said.
Now for any of you not inclined to Biblical reference, that’s a term Jesus used to describe the Pharisees, then the dominant sect of Judaism. Jesus may have loved everybody, but the Pharisees annoyed the bejazus out of Jesus, and he returned the favor. A sepulcher, you see, is a tomb. People liked their family crypts to look nice, showing respect for the dead and all, so they would whitewash them. The paint, as Jesus pointed out, did not change the fact that there were rotting corpses inside, “filth,” I think he termed it. White sepulchers, all shiny outside and gross within.
I remembered that term when I saw Governor Palin on the news today, claiming that the recent investigation in Alaska had cleared her of any wrongdoing, “legal or ethical.” When the reporter pushed back, pointing out that Finding #1 was that she had violated the state ethics code, Palin again cheerfully asserted that yes, the report had cleared her.
This was the same code of ethics that she used to discredit the head of the Alaska Oil & Natural Gas Commission, on which she served, which is the linchpin of her reputation as a maverick. Let’s add in a few other emerging facts:
- Palin was associated with Wasilla residents Mark Chryson and Steve Stoll, members of the Alaska Independence Party, which has connections to theocratic movements and other secessionist parties, particularly neo-confederates in the South. When preparing to run for governor, they advised her to register as a Republican. Since then AIP vice chairman Dexter Clark has bragged about his success in “infiltrating” the Republican Party and urged his fellow theocrats and secessionists to do the same with both Republican and Democratic local organizations. Source: http://www.salon.com/news/feature/2008/10/10/palin_chryson/ Although her campaign is careful to point out that she was never a member and that her husband Todd, a member of 7 years, did not take part in formulating party policy, (he switched to Republican right before her first mayoral campaign) she has remained supportive of them and their agenda, including praising them in her welcoming speech at their 2008 convention. Who is being played here? The AIP wingnuts who hate taxes in all forms and want to secede from the Union (bye-bye Federal funding)? Palin, their Manchurian Candidate? The GOP base? McCain? Voters? All of the above?
- Tonight’s blockbuster news is that their lovely Wasilla home, which Todd, “built himself with the help of some contractor buddies,” was, in fact built for free with the labor and materials contributed by the “contractor buddies” who would go on to build the palacial Wasilla Sports Complex. When looking at the pictures, keep in mind that this facility is in a rural town of approximately 6,000 people and was paid for by a combination of Federal earmarks and raising the city sales tax to a whopping 25%. By comparison, the combined state and city sales tax for New York City, that hotbed of tax ‘n spending, is 8.375%, and far-left pinko Massachusetts, 5%.
- Go listen to the question at the end of the Biden/Palin debate, the one about “if, God forbid, you would have to succeed your running mate” and compare Biden and Palin’s replies.
By their fruits shall ye know them.
The Sheriff of Nottingham…Not!
God bless Thomas J. Dart, Sheriff of Cook County, Illinois (aka Chicago). He noticed that evictions had doubled in the past year. Then he noticed that he was evicting people who had paid their rent in a timely and consistent fashion. The landlords were getting their money, just not passing it along to their lenders.
According to DSnews.com, “Just two years ago, there were less than 19,000 foreclosure cases filed [in Cook County]. This year’s total is expected to exceed 43,000.” On top of all the other problems involving people playing monopoly with real houses, the banks were not doing their due diligence, leaving it up to the Sheriff’s Office to determine if the owner inhabited the house. Tom Dart had the courage to cry foul, and not for the first time. Last year he tried to get a bill passed that would at least identify children and elderly residents of properties in foreclosure so that social service agencies could contact them in advance and ease their transitions to other housing. The bill failed.
There’s historic precedent for Dart’s action, as covered by Ann Keating at http://www.examiner.com/x-781-Chicago-History-Examiner~y2008m10d12-The-Trouble-with-Evicting-People-from-Their-Homes-Even-if-they-dont-Own-them
Tom’s not the first to show compassion. The banks haven’t changed a whole lot, either. Accredited Home Lenders filed, then dropped, a lawsuit in a case where Tom refused to evict. And Chicago is not alone:
http://www.boston.com/realestate/news/articles/2007/10/21/default_crisis_is_evicting_renters/
http://www.nytimes.com/2007/11/18/us/18renters.html
http://www.lasvegassun.com/news/2008/jul/27/when-renter-pays-owner-doesnt-youre-out-tenant/
What can you do if you are in this situation? The following site has some useful information:
http://www.caltenantlaw.com/Eviction.htm [Scroll down to "Foreclosures."]
It suggests that by fighting back, you can delay the whole process by 6 months or so, and this might be the most important sentence in the whole article: “You should also know that if you cannot afford the filing fees, you can get the fee waiver application forms from the Court Clerk, and submit them in lieu of actual payment. When in doubt, do that, because it may be granted, it gives you more time, and it protects your case file from others viewing it.” It also warns against “Cash for Keys” agreements, in which you agree to give up your security deposit and residence in exchange for promises they generally don’t intend to keep.
Important disclosure here: this website,http://www.caltenantlaw.com/, is specific to California Tenant Law. Seek legal advice relevant to your home state.
In the meantime, it would seem that there could be some sort of legal arrangement worked out to get the property shifted from the non-paying owner’s clutches while not disposessing the paying customers. After all, wouldn’t an income-producing property be a more attractive buy than a vacant one? Whether the solution is governmental or private sector, the key would appear to be changing the law that requires a rental property to be vacated before foreclosure. Any thoughts?
After sleeping on it, I’ve come up with one:
- Make the lender’s due diligence include finding out if the owner occupies the property. If not, rather than sending eviction notices to the renters, then would be sent a letter requesting that they show receipts proving they were current on their rents, with a two week deadline. The letter would explain that if they can prove they’re current, they will not be evicted. (Provision should be made that someone who is getting free rent in return for managing the place doesn’t get wrongfully evicted.) Once they have documented their payment status, they would receive instructions to pay their rent to an escrow account. To avoid confusion, the lender could send a couple or three postpaid envelopes to cover the transition period.
- Those who were not current on their rent would be evicted. And yes, Sheriff Dart’s proposal, that those renters be checked for disabilities and age should be included in the proposed legislation.
- The property would be auctioned off at a sheriff’s sale. The funds in the escrow account, less the cost of hiring someone to manage the building, would go to the lender.
Why do I think this would work, even though it gives the lender an extra hoop to jump through? Because an income-producing property would sell for a higher price than a vacant building, thus bringing a greater return to the lender. The escrowed funds would cover the cost of the added research and the cost of managing the property during the transition period.
Be Like Ben!
I came across this discussion of Joe the Plumber economics at OEN:
If Joe takes a salary out of the business of more than $250,000, then he’ll pay more [tax]….Now, let’s say there is a higher tax and it makes Joe reconsider crossing that $250,000 threshold. What else can Joe do with the money? Invest in the business in new services? Expand marketing? Hire more employees? The other side of the decision helps the economy. Oooh, that sound so un-American, so socialist, as Joe accused.
source: http://www.opednews.com/articles/Joe-the-Plumber–the-Para-by-Rob-Kall-081016-366.html
Rob Kall’s on to something, in fact, something that goes back to the Founding Fathers, Ben Franklin, in particular. In Ben’s humble opinion,
All the property that is necessary to a Man, for the Conservation of the Individual and the Propagation of the Species, is his natural Right, which none can justly deprive him of: But all Property superfluous to such purposes is the Property of the Publick, who, by their Laws, have created it, and who may therefore by other laws dispose of it, whenever the Welfare of the Publick shall demand such Disposition. He that does not like civil Society on these Terms, let him retire and live among Savages. He can have no right to the benefits of Society, who will not pay his Club towards the Support of it.
So much for the notion that paying taxes is some kind of Socialist innovation. The following comment on the current banking crisis, from Ellen Brown, also posted on OEN, shows how Franklin put his beliefs into practice, while governor of Pennsylvania:
If banks went bankrupt, they could be put into FDIC receivership and nationalized. The government would then own a string of banks, which could be used to service the depository and credit needs of the community. There would be no need to change the personnel or procedures of these newly-nationalized banks. They could engage in “fractional reserve” lending just as they do now. The only difference would be that the interest on loans would return to the government, helping to defray the tax burden on the populace; and the banks would start out with a clean set of books, so their $700 billion in startup capital could be fanned into $7 trillion in new loans. This was the sort of banking scheme used in Benjamin Franklin’s colony of Pennsylvania, where it worked brilliantly well. The spiraling-interest problem was avoided by printing some extra money and spending it into the economy for public purposes. During the decades the provincial bank operated, the Pennsylvania colonists paid no taxes, there was no government debt, and inflation did not result.
Source: http://www.opednews.com/articles/2/THE-REAL-DEBATE-CRONY-SOC-by-Ellen-Brown-081016-471.html
How far we have come from Franklin’s thinking. In fact, Conservatism, the dominant political philosophy in this country for the last 30 years, seeks to support an economic system that goes back to the Closing of the Commons, the never-ending quest of individuals to enrich themselves by aggregating to themselves that which initially belongs to all. As John Kenneth Galbraith put it,
“The modern conservative is engaged in one of man’s oldest exercises in moral philosophy; that is, the search for a superior moral justification for selfishness.”
Franklin, who began his career in Philadelphia with 3 cents in his pocket and grew to be one of the wealthiest American colonists, understood that material acquisition by itself was an empty, endless pursuit.
Money never made a man happy yet, nor will it. . . . The more a man has, the more he wants. Instead of filling a vacuum, it makes one.
Further, according to Franklin,
An enormous proportion of property vested in a few individuals is dangerous to the rights, and destructive of the common happiness of mankind, and, therefore, every free state hath a right by its laws to discourage the possession of such property.
At a time when a member of Congress, Michelle Bachmann (R-MN) has called for an investigation into “the people of Congress [to] find out if they are pro-America or anti-America” it’s important to ask, just how do you define “pro-American?”
Reversion to Type
A few posts ago, I mentioned Bush’s facial expression as he tried to sell us on his bailout package, you know, “the bird flew in the window and ate all the cookies” look, and how people, when under extreme stress, tend to revert to earlier successful behavior.
Being one who periodically trips over her own feet, I’ve been reading a book called, Self-Defeating Behaviors: Free Yourself from the Habits, Compulsions, Feelings, and Attitudes That Hold You Back. The central insight is that these self-defeating behaviors (example, overeating) were once useful (provided solace after an emotionally painful experience) and are therefore continued even when they are no longer productive.
Hence, Obama is now a Commie. Walk it backwards: He’s black. Didn’t work. He’s a Muslim. Didn’t work. He’s a terrorist. Didn’t work either. Now we’re going all the way back to the Fifties and throwing around terms like Socialist, Communist, (as in “the Communist parts of Virginia”) and anti-America(n).
We’ve still got a couple of weeks to go. Will the $1million donated to Michele Bachmann’s opponent alert Republican’s to the fact that they are making fools of themselves?
Any thoughts as to what their next campaign strategy will be? There are wingnuts around the edges with their “Obama’s Hawaiian birth certificate is not genuine” lawsuit, the “cocaine-fueled gay sex in the limo,” and, of course, the voter fraud charges (while they do everything in their power to engage in voter intimidation).
Speaking of intimidation, go on over to www.Consortiumnews.com and check out what’s up in Alaska. Palin’s people had agreed to testify in Troopergate in July. After her vice-presidential nomination, they began refusing to honor their subpoenas, apparently on the advice of the McCain campaign. A member of the Alaska legislature has called them on it, noting that it appears to be what is known as “witness intimidation,” a federal crime.
Stay tuned.
Priceless in Omaha
Just read this on the Mother Jones website and had to share it:
“…a syndicated morning zoo show on the local classic-rock station was making fun of celebrities, offering up jokes about Jenna McCarthy’s “big cans.” Then the host read a news story about illegal immigrants returning to Mexico because of the economic situation here. The whole crew was apoplectic. “Was that the Bush administration’s immigration policy,” the host shouted, “to make our country suck so bad that everyone will want to leave?’”
Source: http://www.motherjones.com/mojoblog/archives/2008/10/10409_omaha-dispatch.html
Let me count the ways…
- Cost of paying Sarah Palin per diem to stay home while governor, $17,000, paid by the State of Alaska
- Cost of ferrying her children around on oficial business, $21,000, paid by the State of Alaska
- Makeup artist for one month, $13,200, paid by RNC
- New clothes for the whole family, $150,000, paid by RNC
Just think what she will be able to do once she has access to the US Treasury, especially since she thinks that the VP’s job is to run Congress and tell them what bills to pass.
Can you say, “Dick Cheney wears Prada?”
Atlas F*@#ed Up
In my senior year of high school, a friend pressed a copy of Atlas Shrugged into my hands, enthusing that I had to read it. I did, and failed to see the reason for her enthusiasm. Rand’s characters struck me as flat; her worship of geniuses and contempt for the rest of humanity failed to move me. I asked my friend if she thought that Leonardo da Vinci would have accomplished half as much if he had to cook his own food, much less grow it; wash his own clothes, much less spin, weave, and sew; or empty his own chamberpot. I’m afraid that terminated our friendship.
In the intervening decades, having run into the odd Libertarian or two (and you can take this sentence any way you like) I developed my Theory of Ayn Rand. In order to explain it, I have to make a side trip to Lake Woebegone, so bear with me.
In one of his LW stories, Garrison Keillor tells of an angst-ridden young man who nails 95 theses to the door of the Lutheran Church. They’re all a stitch, but the one that pertains to this rant goes something like this:
You taught me that South is East and North is West, and even when I turned it around backwards, it still didn’t work!
Keeping that philosophical insight in mind, lets take the Nickel Tour of Russian History. The tsars ruled Russia for about a thousand years. They largely treated their people like shit, and enlisted the Church in support of the throne, a strategy that has been employed since the dawn of either churches or thrones. Kommes der revolution, everything, being totally wrong, gets turned on its head.
Royalty? Evil. Wealth? Evil. Religion? Evil. What’s good? Working class chuds.
Into this new social order is born Miss Rand, a bright child, daughter of a pharmacist who lost all in the effort to purify the nation of any semblance of economic inequality. Please keep in mind that the middle class was the face and hands of the wealthy. The Count didn’t come around and evict you if you didn’t pay your rent. He hired someone to do that, someone who had a steady paycheck and a nice house to live in for doing the Count’s dirty work. Or, maybe, told someone that no, they couldn’t have the medicine their child desperately needed unless they could pay for it. So, middle class? Evil, too. In short, this was not a society in which someone like Miss Rand could get any respect.
South being East and North being West, she corrected the error by turning it upside down. Oddly enough, it wasn’t the Holy Little Father the Tsar that came out on top of her new world order. No, it was the geniuses like herself. (Ms Rand was not noted for her humility.) You see, if people like herself were just left to their own devices, the world would improve at an exponential rate. Complete freedom. Rules being unnecessary, as the law of cause and effect would trump everything.
Ms. Rand had notable followers and fellow travelers: Alan Greenspan, Milton Friedman, Leo Strauss and his acolytes come to mind. She had no children, but many intellectual offspring, worshiping at the altar of Communism’s polar opposite, the Free Market.
Fast forward half a century, and Miss Rand’s philosophy of selfishness is summed up by the renowned philosopher, Gordon Gekko: “Greed is good.” Freed of silly regulations, the Market will function with the perfect balance of Mother Nature herself. The weak will fail, the strong thrive and prosper, to the benefit of all. Fast forward another thirty years, give or take, and Reality says, “Not so much.” Mother Nature, as bountiful as she is, has been known to serve up the occasional hurricane, drought, or flood. It turns out that those stupid chuds are necessary to the greater well being of the genius types after all, if only to keep paying the mortgage interest that flows through the derivatives labrynth, emerging at the top as new Beemers and mansions in the Hamptons.
Miss Rand’s ideal dog-eat-dog world is maybe not such a great place to live after all.
So can we get it right this time? Can we strike a balance between Freedom and Responsibility? Can we thread the narrow path that allows the individual to express his or her abilities to the fullest without damaging others who are less gifted, or less ambitious? Can we view the world clearly, and make our decisions based upon fact and not ideology?
Can we set our compass to True North?
The New New Republican Strategy
In a post a few days ago, I asked what tactic the McCain campaign would embrace next, and wondered if McCain’s repeated use of the word “fight” was a code. How blind I was.
Feldman notes the “complete repackaging of the McCain campaign” in “violent populism.” He notes a Time report about McCain staff in Virginia training volunteers to tie Obama to Pentagon bombings and says that the McCain campaign has “a ground operation actually training its volunteers to elicit violent responses in voters–specifically by making false claims about Barack Obama.” This raises questions, he says, of whether “John McCain is using campaign rhetoric that not only depart from recognized moral boundaries, but risk igniting actual violence.”
Some pundits have been reluctant to believe that John McCain would want to launch these baseless and wrongheaded attacks. They lament, where has the real John McCain gone?
Source: http://www.huffingtonpost.com/dawn-teo/mccain-palin-and-the-luci_b_136572.html
The real John McCain, whoever he may have been, is no more. One has only to look at the recent McCain/Palin interview to see who the dominant person is in that relationship. McCain is not in charge of his campaign. Hasn’t been for months. Remember when his own campaign advisor stated that “John McCain does not speak for the McCain campaign?” At the time it seemed merely weird. Now McCain knows he’s lost the election, and will join Barry Goldwater on the list of all time biggest losers. He’s given up trying to win and has set his sights on revenge. I don’t think he even cares whether Republican policies continue, just that Obama and his supporters suffer. Those behind him are looking for ways to nullify the electoral results, by violent means, if necessary. Here are some of the attacks from the past ten days, from the above article:
Sunday, October 12
In one case, an Obama supporter was shopping with his infant son when an angry McCain-Palin supporter rammed his shopping cart. Luckily, the police were able to identify the man from video of his license plate, and he was charged with assault.
Wednesday, October 15
In Greensboro, North Carolina, a reporter Joe Killian was kicked to the ground at a Palin rally just for doing his job. He was interviewing Obama supporters who were protesting the Palin rally after a group of angry McCain-Palin supporters warned him that Palin was the story – not the protesters. One McCain-Palin supporter was so angry at Killian for interviewing the Obama supporters that he kicked him to the ground – from behind.
Friday, October 17
Even Barack Obama’s home state is not immune. Two separate homeowners in Villa Park, Illinois found death threats in their mailboxes that read,
Get the Obama signs off your property – now. Failure to obey this order will result in the immediate death of all family members.
Although both families vow to keep the signs in their yards, one of the families is now afraid to let their 7 year old son play outside in the yard.
Saturday, October 18
In Wisconsin, McCain-Palin supporter Ronald Goetsch physically attacked 58 year old Nancy Takehara, grabbing her by the hair and striking her in the face, while she was canvassing for Obama. According to Takehara, “[Goetsch] was telling us we’re not his people, we’re probably with ACORN, and he started screaming and raving. He grabbed me by the back of the neck. I thought he was going to rip my hair out of my head. He was pounding on my head and screaming. The man terrified me.”
By the time Takehara returned to her home in Chicago, she had a message from Barack Obama on her answering machine. She called the number that had been left on her machine and talked directly to Obama. He reassured her and said that this is an isolated and extremely rare occurrence, but many Obama canvassers have begun to voice fear or nervousness about canvassing both because of a rash of incidents reported in the news and because of a notable change in atmosphere on the streets. Some who were previously comfortable canvassing along are now opting to canvass in pairs.
Saturday, October 18
Incidents have even occurred at Obama events. In Fayetteville, North Carolina, someone slashed the tires on more than 30 cars during an Obama rally, leaving women and children stranded. Lynne Steenstra, whose tires were slashed, believes it was meant to intimidate Obama supporters, to prevent them from casting their votes.
Sunday, October 19
The car of an Obama volunteer was trashed (rear windshield smashed, spray painted, stolen Obama signs shoved into the backseat) while he was out to dinner with friends.
Sunday, October 19
In Princeton, West Virginia, a crowd of McCain-Palin supporters gathered to heckle and intimidate mostly black voters as they arrive to vote at an early voting location. When journalist Christina Bellantoni asked the sheriff if the protesters were allowed at the early voting location, the sheriff showed no concern of voter intimidation and merely answered, “They’re fine.”
October 19, 2008
In Fairfield, Ohio, Mike Lunsford hung an Obama effigy from a noose in a tree in his front yard. He attached a campaign sign to a ghost figure, wrote “Hussain” (yes, it was misspelled), put a noose around its neck, and strung it up in a tree.
I have found no reports of Obama supporters retaliating or otherwise engaging in violence in this campaign. [Note: I read of a small-town McCain office being vandalized, but have seen no follow-up reports.]
Tuesday, October 20
A bear carcass was dumped with Obama signs strung around its neck at the base of the statue at the entrance to the Western Carolina University campus in Cullowhee, North Carolina, where tensions have recently been heating up between conservative locals and liberal college students.
October 21, 2008
Someone took an Obama yard sign and replaced it with a large Confederate flag in the yard of an elderly African American minister. That night, after the flag had been replaced with a new Obama sign, a car drove by several times, honking and yelling at the family. The next day, the car returned again, honking and yelling in broad daylight, “No Change!” while a reporter interviewed the family in the yard. The minister told a local reporter that he had a simple message to pass on to the culprit, “I love you, and God does too.” The Baptist minister also told the reporter, “I feel like this is somebody with a lot of hatred in their heart. It’s our job to help the guy try to do better in life.”
…and of course today’s headline, “McCain Campaign Worker Mutilation Hoax,” which was quickly debunked.
There’s more, of course. Republicans intend to place 3,600 paid recruits inside Ohio polling places on Election Day to challenge the qualifications of certain voters.
Source: http://www.huffingtonpost.com/diane-tucker/dems-mobilize-against-ohi_b_137528.html
The thing that most concerns me is that after the election, Obama supporters will think, “The long night is over. We won!” and go back to their own concerns, just like we did after Watergate and Iran/Contra. At this point, it appears that the Republican strategy is to poison the national debate to the extent that rural areas of the country will consider some form of Civil War. (You know, the “Real America” defending its “values.”) Keep in mind that Sarah Palin, with her ties to the secessionist Alaska Independence Party and theocratic Christianity, is very obviously positioning herself to run in 2012.
Will we go back to sleep and let this happen? Will we be able to maintain our center, our emotional equilibrium, and not stoop to their level, returning hatred for hatred and blow for blow? Again, Ben Franklin said it best, “A Republic, if you can keep it.”
The 5 Stages of McCain/Palin
Republican Strategy, oy…
After taking his pasting by Rachel Maddow, American Enterprise Institute think-tanker David Frum contributed the following article to the Washington Post:
Sorry Senator, Let’s Salvage What We Can.
If you’ve been reading my posts, you can probably figure out that I have a few problems with it. I do agree with his points that the McCain campaign, despite their rosy predictions, is most likely dooooooomed, and that the Palin choice bears much of the blame, and I suppose that loyal Republican that he is, he feels honor bound to offer a strategy for salvaging at least something out of the rubble, i.e. shifting funding from the presidential race to Congressional races, but first, I don’t think they’ll take his advice, and second, I find his reasons for supporting Republican candidates ludicrous.
Why they won’t
The President in and of himself, has, according to the Constitution, 1/3 of the power of the Federal Government, the remaining 2/3 being split between the 9-member of the Supreme Court and the the 535 squabbling members of Congress. Under Bush and Cheney, that Executive Branch share has grown exponentially. The Republicans have hidden so much dirt under the White House rug that it’s turned into a compost heap. (Just how many signing statements are there? Which laws do they affect? What really is the law of the land, anyway? How many prisoner are scattered in which dungeons in what countries? What does Corporal Jones calls his wife when he phones home after six months in Iraq? And just what is our National Energy Policy, anyway? to name just a few.) The Republicans cannot afford to let go of the office. Despite the fact that Frum’s advice makes sense from a tactical standpoint, it simply will not happen.
Now for the fun part…
Here are a few of the points he raises, at least the ones that irked me:
“Divided government is the best precaution you can have.”
I don’t recall him holding this position when Karl Rove was advocating a permanent Republican majority.
“You need oversight and accountability.”
Which is an interesting concept, coming from a member of the party that abandoned oversight for 6 years and locked Democrats out of the hearing room when they tried to hold investigations.
“The United States needs Republicans and conservatives to monitor the way Democrats wield this extraordinary and dangerous new power — and to pressure them to surrender it as rapidly as feasible.“
This refers to the $700 billion bailout package, currently being used by FOR (friends of Republicans, such as JP Morgan & Co.) to buy up tottering banks at bargain prices, rather than improve liquidity and clean up the mortgage mess, the alleged purpose of the bailout. There is nothing new in Republicans pressuring others to surrender power, (for their own good, of course, but the notion that giving Republicans power (or reducing the power of alternate parties vis a vis Republican power) is good for the country has been demonstrated false over the last 8 years. Oddly, when Republican control the government, the economy grows more slowly than when the Dems have their hands on the throttle, and such growth as there is is skewed toward the top 1% of the economic system. As John Kenneth Galbraith put it, “The modern conservative is engaged in one of man’s oldest exercises in moral philosophy; that is, the search for a superior moral justification for selfishness.”
“There’s a fierce new anger among many liberal Democrats, a more militant style and an angry intolerance of dissent and criticism.”
Actually, the anger is over the lies, not dissent or criticism. Thousands of Americans have been injured or killed; millions of Iraqis have lost homes and loved ones, all due to a pack of lies in service of imperial ambition camoflaged as “spreading Democracy.” You bet there’s anger, and it’s not just Democrats. It’s mothers whose children have come home in a box. It’s reservists and National Guard members who have lost their businesses, jobs, and spouses under the pressure of repeated tours in Iraq. It’s the parents of sick children, who can’t afford treatment for them. It’s families facing foreclosure because the Bush Administration refused to enforce fraud laws against its contributors at Countrywide and pushed to tighten bankruptcy laws. It’s every worker who watched his job be shipped overseas to get his CEO a bigger bonus. Your ideology and policies have hurt so many, David, and earned you their scorn. (Oh, and ps—when the government is saying it, it’s not dissent., it’s “official policy” and those who support it are not dissenters.)
“Some will want to silence conservative talk radio by tightening regulation of the airwaves via the misleadingly named “fairness doctrine”; others may seek to police the activities of right-leaning think tanks by a stricter interpretation of what is tax-deductible and what is not.”
Compare this to the Reagan Office of Public Diplomacy, that harangued editors, threatened reporters, and stifled reporting on the Contra/Cocaine connection and other right wing malfeasance. (Otto Reich, John McCain’s Latin American foreign policy adviser, was the lead Rottweiler in that endeavor.) Consider that both the Washington Times and Weekly Standard were financed by Sun Myung Moon, a man whose stated goal is to overthrow American democracy and replace it with a theocracy that worships himself. What cause are you serving, David?
Once upon a time, the Republican Party made much of personal responsibility. It’s time for you to man up, examine your conscience, and start working for the good of the country, not just those in the executive suite. As Ann Coulter would say, “Quit whining.” You have richly earned everything you are now experiencing.
There Really is a Better Way to Run an Election
It’s 9:20 pm here, and I just watched the coverage of midnight voting in Dixville Notch, NH. 21 votes cast: 6 McCain, 0 Nader, 15 Obama. A good omen.
They filed past, dropped their ballots in the box, and in less than 10 minutes it was all over. As you may have noticed, things won’t go this smoothly in most of the country.
I have a suggestion to pass along to you. Out here in Oregon, we vote by mail.
Yup. a month before the election, they send out booklets with all the info: candidates, propositions, zoning changes, bond issues, you name it. A week later, a second booklet arrives, chock full of position papers by the supporters and opponents of the various propositions. One week after that? Your Paper Ballot. Once you’ve finished your decision-making process, you MAIL IT IN, or, if you prefer, run by the local election board office or public library. You’ve got until election day.
That’s it. No muss, no fuss, no lines, no time off from work, no BS about Democrats voting on Wednesday, or getting arrested at the polling place for a traffic ticket. No high-pressure snap decisions in the little booth. NO DIEBOLD.
Here are some links:
http://www.sos.state.or.us/executive/votebymail/
http://www.co.multnomah.or.us/dbcs/elections/election_information/voting_in_oregon.shtml
Consider starting a petition, writing your Congressman, making some changes that would make Democracy work so much better.
psst…tell your friends.
The First Week
Sometimes, reading political commentary, I think back to an early review of the Harry Potter movie, in which the writer chortled that it would be very weird to watch “an 18-year-old Daniel Radcliffe play Harry Potter in the seventh movie,” apparently not having done the basic homework of finding out that the characters age a year in each book as they progress through the Hogwarts curriculum. Today’s gem was the notion that by choosing Rahm Emmanuel as Chief of Staff, Obama was going with a Left-wing Clintonite Washington-insider agenda. Basic homework again. Rahmbo has represented Chicago in the House of Representatives since 2002 and their families (yes, that includes wives and kids) are friends.
So, like, if even that guy can make predictions, why not me? Here they are:
- John McCain will position himself as the go-to guy for the moderate wing of the Republican Party. Lindsay Graham has already positioned himself as wingman, and I suspect that Lieberman will offer himself as Third Musketeer.
- If Ted Stevens is dumped (and they don’t find the missing ballots in Anchorage that might conceivably go to Mark Begich) Sarah Palin will run for the Senate. The fact that she said she wouldn’t is proof enough for me.
- The rightward edge of the Republican Party will become a dogfight between the Social Conservatives and the NeoCons. If Palin makes it to the Senate, the SDs will coalesce behind her, if not, Huckabee. The NeoCons, not having realized that the rest of the country thinks they are criminally insane, will try at least one highly dramatic legislative stunt, which will backfire. It is also possible that the SDs will also try at least one highly dramatic legislative stunt, to similar effect.
- The moderates will stay out of the dogfight, cut deals with Obama, and wait until things sort themselves out before aligning with the winning faction.
- We will make more progress toward developing alt energy and solving global warming in the next 8 years than in the last 30.
- Someone will notice that Sarah Palin talks more than Joe Biden and call her on it publicly.
The Republican Conundrum
Much ink is being spilled these days over the current disarray in Republican political circles. Was Palin helpful, or not? Should McCain have gone more negative, or less? John Boehner recently called for a return to “First Principles.” I have a philosophical problem with that. If the ideals you have been pursuing for the past three decades have left the nation in the dumpster, why bother clinging to them? There’s a deeper problem with those First Principles, as well, which the Republican Party will discover as it churns through its debate. Significant numbers of those First Principles contradict each other.
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Republicans want small government.
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Republicans want American global domination.
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Republicans want Freedom.
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Republicans believe that anyone who disagrees with their politics is a danger to the nation and should be carefully watched, lest they do harm.
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Republicans want a responsible, self-sufficient population.
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Republicans want no restriction on the accumulation of wealth, no regulation of the means by which it is attained, and no means of recourse for those who may be harmed in the process.
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Republicans want a nation ruled by Christian morality.
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Republicans believe government has no business poking it’s long nose into one’s life.
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Republicans want low taxes.
- Republicans want no limit to the amount of money spent on maintaining American Dominance.
- Republicans are against abortion.
- Republicans are against helping impoverished families support their children.
I believe these are the most significant contradictions. Any astute political observer will be able to identify which Republican sub-group supports which position, and as long as they persist in stalwartly clinging to these principles, the GOP will be more catfight than party. There are two ways out of this conundrum. The first, and more likely outcome, is that the catfight will continue until the last man standing wraps himself in the party mantle. If that is the case, expect to see either new parties forming, or existing minor-league parties gaining new recruits. The second, less likely outcome, is that the party will recognize that their principles did not achieve the expected results and develop new principles. Given the current reliance on ideology as a defining characteristic of Republicanism (or Conservatism, as many of their commentators tend to use those terms interchangeably) anyone suggesting a new set of principles will likely be spit out. Given the Evangelical wing’s insistence that their personal salvation is based upon adherence to certain of those principles, expect them to either bolt or be that last man standing. Or woman…Palin’s fortunes within the party may well be the litmus test for this. (I’m not writing off Huckabee, but she seems to have the more dominant personality.)
I have a theory about how political identity is formed. Around about age 3, one realizes that life is not fair. Those who feel it should be made more fair head leftward. Those who gravitate toward the right do so under the logic, “If life is not fair, how can I make the system work in my favor?” This can take the form of, “What are the rules, so I can follow them and succeed?” or “How can I stack the deck in my favor?” or some combination of both.
If you look at the list of contradictions above, you’ll see that the common thread can be boiled down to, “Government should control other people’s behavior, but not mine,” which is a pretty good compromise between following the rules and stacking the deck. If Ghandi’s statement is true, that the arc of the Universe bends toward justice, then the Republican Party, as currently constituted, is on the wrong side of history.
But there is still a need for a strong opposition party. History is littered with examples of well-intentioned programs leading to unintended consequences. New proposals need to be vetted, thought through, and debated vigorously. But if the opposition’s paramount value (cloaked in whatever high-flown rhetoric) boils down to, “What’s in it for me?” then the debate will be twisted and come to rely on lies and character assassination rather than the merits of the actual proposals. (See campaigns 2000, 2004, & 2008.)
Perhaps, rather than “First Principles,” the Republicans should develop a vision of what their perfect America would look like, then a set of programs that would get it there.
I mean, other than, “Us on top, forever.”
After I’d written the above essay, just before I was about to hit send, another thought struck me. Code talkers. Republicans talk in code. No one realized this until the Religious Right freighted in and W. made entire speeches whose true meaning flew over the heads of the unsaved. Code talking existed unrecognized in American politics long before that. I think it was back in the Sixties that I noticed that “Democracy,” when uttered by an American politician, really meant, “allied with US interests or under American control.”
So what are “First Principles?” Taking out my secret decoder ring (as I am not a native speaker) I’m thinking that it could mean the following:
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Republicans want small government.
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Republicans want low taxes.
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Republicans want a responsible, self-sufficient population.
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Republicans believe government has no business poking it’s long nose into one’s life.
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Republicans want freedom.
Prediction: This definition of “Return to “First Principles” means abandoning the anti-abortion stance, which opened the country club doors to the Holy Rollers, and tossing the empire-building Neo-cons out on their ears. It would represent an alliance between the moderates and the Libertarians. [Keep in mind that Margaret Sanger's early support came from conservative Republicans, not so much that they had witnessed women trapped in abusive marriages by endless pregnancy, nor because they believed, as she did, that every child should be a wanted child, but for eugenic reasons. They saw the world being overwhelmed by impoverished, brown-skinned hordes.]
However, to certain Republicans, “First Principles” would mean:
- Republicans are against abortion.
- Republicans want a nation ruled by Christian morality.
- Republicans want a responsible, self-sufficient population.
Prediction: This faction claims no more than 25% of the electorate. If they dominate, they will draw the racist elements, for whom terms like “responsible” and ”self-sufficient” are code for “white.” They will also ally with the anti-gun control and law ‘n order crowds. These factions are the most likely to take the government in a draconian direction or, failing that, to rebel. (See: Palin, Todd, Alaska Independence Party.) The other possibility (remote at this point) is that they will revert to their original non-political roots, waiting for Jesus to sort things out and hand them Dominion on a silver platter.
The there’s the corporate wing, whose interests can be summarized as follows:
- Republicans want American global dominance.
- Republicans want no restriction on the accumulation of wealth, no regulation of the means by which it is attained, and no means of recourse for those who may be harmed in the process.
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Republicans want low taxes (for the top 1%).
- Republicans want no limit to the amount of money spent on maintaining American Dominance.
- Republicans believe that anyone who disagrees with their politics is a danger to the nation and should be carefully watched, lest they do harm.
- Republicans want Freedom. (Defined as freedom from regulation of the business sector.)
Prediction: In case you haven’t been paying attention, this is George W. Bush’s wing of the Party, despite the Neo-con varnish and all the lip service to the Religious Right. At the moment, the invisible hand of the market has pointed to their invisible clothing, but this wing is largely composed of those who control the economy, and their wealth, and therefore power, is substantial. Will they learn the lesson, that the golden goose is mortal after all, back off, and accept a reasonable balance between freedom and legal restrictions? Will they acknowledge that the economy does not work in a trickle-down fashion, and that when the bottom of the well runs dry the entire system grinds to a halt? If so, they will most likely come to an accomodation with the first, limited-government group, returning to the traditional, pragmatic, Eisenhower Republican philosophy.
If that happens, the Libertarians, Neo-cons, and Religious Right will spin off leaving the rest of the part without enough votes to govern. In any event, the Republican Party will be in the minority until enough time passes that a/ the Dems succumb to the temptations of power and screw up, b/ a new, charismatic, Reaganesque figure emerges, or c/ we all forget what happens each time they come to power.
More Predictions
One:
Obama will have effective control of the government by the end of the year, possibly sooner. I’m not meaning this in a bad “he’s staged a coup” way, but in response to two facts: first, there happens to be a many-faceted diamond of a crisis going on right now, and second, the Bush Administration and it’s many minions aren’t doing anything about it. One might excuse this as evidence of their belief in the Libertarian throw-the-baby-in-the-creek-and-see-how-fast-he-can-learn-to-swim theory of economics, but I can’t help but notice that our current leadership is obsessed with wringing as much out of the situation for their own interests as possible (their own interests being that of the American corporate world.) While Wall Street burns through trillions of OPM, Bush focuses on executive orders that will gut the Endangered Species Act, give Big Oil more virgin acres to ravish, and put nukes next to the Grand Canyon….oh, and implant their Regent University grads in the federal bureaucracy so as to continue their obstruction of the work of numerous agencies. (Prediction 1-a: Look for lots of lateral transfers to basement offices after January 20 and the return of experienced hands who quit during the Bush years.) Oh, yeah, and Bush agreed to a truly bizarre treaty with Iraq so he could declare victory, which the grateful Iraqis celebrated by burning him in effigy. Priceless. Bush was always better at the “destruction” part of “Creative Destruction,” anyway.
I’ve got lefty friends wringing their hands over the notion that Gates will continue at Defense, but I see a strategy here. For example, Obama just picked Geithner to head Treasury. Not only is Geithner the person who publicly called foul on CDOs back in 2006, when everyone, including the sainted Alan Greenspan, were saying they were just peachy, he is also the President of the New York Federal Reserve Bank, which, in case you don’t spend your time boning up on the banking system, is the 800-pound gorilla on the Federal Reserve Board. He’s already in place, doesn’t need to take more than 5 minutes to dictate his letter of resignation, doesn’t need to finish grading term papers before starting his new job. He’s already doing it. He’s been working with Paulson for years, but in a subordinate position, 800-pound gorilla to Bernanke and Paulson’s half-tonners. Now he’s an equal.
I was in the cafeteria when Paulson gave his latest speech. I couldn’t hear what he was saying over the conversational hum, but I could see that every time his lips moved, the stock market ticker next to him on the screen trended downward. Later I found out that the summary of his speech was, “I don’t have a clue, so I’m handing it off to the new guy.” Within 24 hours, there was the new guy, already standing at his elbow. So the question is: Will Paulson obstruct, or will he work constructively with his successor? Assuming that Paulson’s calculus revolves around the equation, “What’s in it for me?” I’m thinking that he will listen and act. One, standing by clueless while the economy tanks doesn’t look good on your resume. Two, the political winds have shifted and he will set his sails accordingly. Prediction 1-b: Those toward the Left will squawk: “They call this change!? Where’s the new blood?”
In a similar fashion, I think that if Gates remains, and Bush continues to focus on the vital business of deciding how to write a pardon that will absolve everybody from everything back to the Beginning of Time, Gates may be amenable to proactively chatting with the incoming administration. (Maybe Bush should just take the entire White House staff and Cabinet down to the Potomac and dunk ‘em. Hallelujia!) With this paradigm in mind, It will be interesting to watch the unfolding saga of Obama’s picks.
Two:
The Republican Party is pretty much sorting itself out as I predicted in my previous post. Thanks, guys! The Rightosphere is planning to flex their muscles, now that they can point to the Obama campaign’s successful use of the internet. It won’t work, at least until they grapple with their underlying problems: a philosphical mindset that is opposed to what most people in this country want, a history of winning elections by misrepresenting their true goals (Compassionate Conservatives, anyone? How about a slice of humble foreign policy pie?) I lurk on several right-wing sites, and they are still focused on strategy, not on a deep examination of conscience, or even demographics. Right now, Huckabee seems to be the only one who is taking that tack. A second problem with the notion that the Internet will save the Conservative cause is that Conservatives tend to be reluctant to adopt the new, just by their nature. While the blogger I read used conservative leadership’s rejection of the Internet as a campaign tool as his example, it brought to mind a conversation I once had with a fellow who wouldn’t have a computer in his house because he didn’t want the government spying on him. Lots of luck reaching him with your enhance graphic capabilities and sophisticated database management, Sparky. Read an excellent analysis of the issue here.
Three:
Tina Fey willing, Saturday Night Live will feature a “Palin” interview in front of an outhouse, with sound effects. Or maybe in front of a mugging. Or a couple of guys field dressing a moose. Or World War III. Or a lumberjack pissing on a tree. Or all of the above. Prediction 3-a: She will never hold national office, but either she or a family member will eventually have their own reality show.
Blowing the Foam off the Beer
A few posts back, I ended with the question of how to blow the foam of CDOs off the financial stein without spilling the beer. Recently I read this article, which pretty much sums up the bad pour that generated the foam in the first place. Here’s the central insight:
The typical mortgage bond was still structured in much the same way it had been when I worked at Salomon Brothers. The loans went into a trust that was designed to pay off its investors not all at once but according to their rankings. The investors in the top tranche, rated AAA, received the first payment from the trust and, because their investment was the least risky, received the lowest interest rate on their money. The investors who held the trusts’ BBB tranche got the last payments—and bore the brunt of the first defaults. Because they were taking the most risk, they received the highest return. Eisman wanted to bet that some subprime borrowers would default, causing the trust to suffer losses. The way to express this view was to short the BBB tranche. The trouble was that the BBB tranche was only a tiny slice of the deal.
Ok, Investing 101 so far. The investors willing to take the greatest risk get the biggest reward. However, demand grew, and there are only so many impoverished people willing to get suckered into high interest mortgages. Enter the magic of the market, via double-entry bookkeeping:
But the scarcity of truly crappy subprime-mortgage bonds no longer mattered. The big Wall Street firms had just made it possible to short even the tiniest and most obscure subprime-mortgage-backed bond by creating, in effect, a market of side bets. Instead of shorting the actual BBB bond, you could now enter into an agreement for a credit-default swap with Deutsche Bank or Goldman Sachs. It cost money to make this side bet, but nothing like what it cost to short the stocks, and the upside was far greater.
The arrangement bore the same relation to actual finance as fantasy football bears to the N.F.L….
But wait, there’s more!
Eisman knew subprime lenders could be scumbags. What he underestimated was the total unabashed complicity of the upper class of American capitalism. For instance, he knew that the big Wall Street investment banks took huge piles of loans that in and of themselves might be rated BBB, threw them into a trust, carved the trust into tranches, and wound up with 60 percent of the new total being rated AAA.
Ruh-roah.
“You have to understand this,” he says. “This was the engine of doom.” Then he draws a picture of several towers of debt. The first tower is made of the original subprime loans that had been piled together. At the top of this tower is the AAA tranche, just below it the AA tranche, and so on down to the riskiest, the BBB tranche—the bonds Eisman had shorted. But Wall Street had used these BBB tranches—the worst of the worst—to build yet another tower of bonds: a “particularly egregious” C.D.O. The reason they did this was that the rating agencies, presented with the pile of bonds backed by dubious loans, would pronounce most of them AAA. These bonds could then be sold to investors—pension funds, insurance companies—who were allowed to invest only in highly rated securities.
Take three deep breaths and keep reading:
That’s when Eisman finally got it. Here he’d been making these side bets with Goldman Sachs and Deutsche Bank on the fate of the BBB tranche without fully understanding why those firms were so eager to make the bets. Now he saw. There weren’t enough Americans with shitty credit taking out loans to satisfy investors’ appetite for the end product. The firms used Eisman’s bet to synthesize more of them. Here, then, was the difference between fantasy finance and fantasy football: When a fantasy player drafts Peyton Manning, he doesn’t create a second Peyton Manning to inflate the league’s stats. But when Eisman bought a credit-default swap, he enabled Deutsche Bank to create another bond identical in every respect but one to the original. The only difference was that there was no actual homebuyer or borrower. The only assets backing the bonds were the side bets Eisman and others made with firms like Goldman Sachs. Eisman, in effect, was paying to Goldman the interest on a subprime mortgage. In fact, there was no mortgage at all. “They weren’t satisfied getting lots of unqualified borrowers to borrow money to buy a house they couldn’t afford,” Eisman says. “They were creating them out of whole cloth. One hundred times over! That’s why the losses are so much greater than the loans. But that’s when I realized they needed us to keep the machine running. I was like, This is allowed?”
Apparently the answer was “Yes,” and the allegedly free-market consequence is that the government will race in with billions of taxpayer dollars to allow the executives that set up this Rube Goldberg device to keep their bonuses.
This still doesn’t address the question of how to disentangle the finances of those who made good-faith investments in AAA bonds from those who created and ran a system that allowed garbage to be marketed as gold, but understanding how it was done is a start. The problem, we are told, is that “those crappy sub-prime ACORN mortgages the banks were forced to make defaulted and tanked the system.” No so much. The problem, we are told, is that “nobody understands these CDOs.” Well, now you do. If it wouldn’t be too much trouble, could you forward this post to your elected official?
The Beck Secession
Well, there you have it, Glen “I am not a racist” Beck is calling for the Republican areas of the country to secede. I don’t know that it’s necessarily racist to want to leave the US after Obama’s election. It could be simple paranoia. I can think of a few folks on the Left who contemplated moving to Canada when Reagan was elected, and then again in 2000. That’s the difference between the Right and the Left. The Right wants to keep their real estate.
Still, what would happen if the um, Rightward States seceded? Well, first off, which states are rightward, and how many of them are rightward enough to waltz on out the door? I suppose Glen is envisioning that broad swath of red on the electoral college map, but I suspect the most likely would be the more limited area where Republicans actually picked up vote share a couple of Tuesdays ago: southern Appalachia, the Ozarks, and Oklahoma. Oh, and Alaska, where Governor Palin would presumably be crowned Queen Sarah.
What are we looking at? Well, we’d lose the Kentucky Derby, Jack Daniels, and a couple of Saturn and Toyota plants. We’d lose a bunch of coal and Alaska’s twenty, no, fourteen, no three percent of our energy supply. We’d lose the ability to protect ANWAR from drilling and to enforce safety and environmental standards on a lot of coal mines, and that all-important back porch view of the former Soviet. They, as traitors, would presumably lose their Social Security, Medicare, Medicaid, Food Stamps, ag subsidies to farmers, Head Start, and various pork barrel projects, like roads, schools, and dams. They’d lose a bunch of military bases, too, along with the businesses supported by all those G.I. paychecks. I think Glen would be over-optimistic to think that all of the soldiers sworn to defend the Constitution would go over to the anti- side, even though Robert E. Lee did. And those who did would, of course, lose their paychecks anyway. Still, the Rightward side is generally agin’ all those things, except for the military, so they probably wouldn’t miss them. They’d still have Walmart. They could plant gardens. And if they genuinely are racist, maybe they’re thinking they can get the black folks to tend their gardens for them, maybe they’re thinking that said folks wouldn’t either leave town or fight back.
I suppose they could get pissy and try to blockade the Mississippi or some such, but that’s what a Navy’s for. Gunboats on the river blasting away, protecting the barges full of grain on their way to blue-tinged New Orleans.
But look at the upside. Without Alaska’s oil and Appalachia’s coal, we’d be forced to develop alt energy sooner. Without Alaska, which sucks up far more government funding than it provides in taxes, we’d have a little more money to do all kinds of things with. In fact, a quick trip to www.taxfoundation.org reveals that those states with increasing redness are all doing quite well under our current pointy-headed liberal tax and spend system. Here’s how much each of those states gets back for every dollar of Federal tax paid by its citizens:
Alaska $1.87
West Virginia $1.83
Mississippi $1.77
Alabama $1.71
Oklahoma $1.48
Arkansas $1.47
Louisiana $1.45
I don’t know. It’s hard to tell what’s really going on when TV talking heads come up with these notions. Does Beck even halfway believe what he’s saying, or is this just a way to catch a media buzz? Or is Fox, Beck’s new home, now the face of Treason?
But maybe he’s on to something…maybe we do need to cut loose of those parasites sucking on the government titty. If you look at the Tax Foundation’s map, you’ll see that all red states, with the exception of Texas ($.94) and Georgia ($.96) get more from the Feds than they pay in federal taxes. A smart response to secession would be to close all the military bases, removing all personnel and ordnance, cut off all Federal funding to rebel areas, and wait. I’m thinking the rebellion would be over two days after the Social Security payments failed to show up in old folk’s checking accounts. In fact, reducing Federal spending to an amount equal to Federal revenues collected might just be a good bargaining point for readmission.
Be careful what you wish for, Glen.
Hank Paulson: Underpants Gnome?
Well, it’s just come out that bank lending really hadn’t frozen up the way they said it had. And that $700 billion, at least the half that’s been distributed, hasn’t increased bank lending. And that the little sentence in the Bailout Bill that prohibited any of that taxpayer largess going to executive bonuses was revised to say it only applied to funds disbursed via auctions of toxic securities. And there were no auctions. And the executives get their bonuses. And it’s all perfectly legal.
Go ahead, go back to my first post on the bailout. I will quote from it:
It’s a scam.
Actually, go back and read up on how the first Great Depression came into being:
- Overextension of credit, leading to an investment bubble.
- Major investors quietly pull out their capital.
- Credit is curtailed to ordinary folks.
- Major deflation, unemployment, etc.
- Asset prices decline while those with capital sit on the sidelines.
- When asset prices have cratered, big money buys them up for 10 cents on the dollar.
- Massive government economic stimulus (on the order of WWII) reboots the system.
Or, you could just watch South Park. Months ago, when I first blogged on this subject, my son told me it was an Underpants Gnome scheme. I just got around to googling the term. Wikipedia features a deadpan recounting of the infamous underpants gnome episode of South Park. For the uninitiated, I will sum up:’
Underpants gnomes are small, humanoid creatures that steal underwear. They are businessmen, however, and can prove it by showing you their business plan:
- Steal underpants
- ???
- Profit!
The first paragraph, above, outlines at least one of the ?s. Except it’s $700 billion worth of underpants we’re talking, here, which, if logic serves, would make Hank Paulson the world’s tallest underpants gnome.
Seven Fat Cows
Pharaoh had a dream, a vivid, recurring dream of seven fat and seven skinny cows. Only Joseph could interpret it.
“There will be seven years of plenty followed by seven years of famine,” he said, and further advised that the surplus be conserved and stored to sustain the nation through the lean times. Pharaoh took his advice and Egypt prospered.
Fast forward a few millennia, and we had our seven fat years, also known as the Clinton presidency. The budget was balanced, we lived, as a nation (although not necessarily as individuals) within our means, we saved for the future, and prosperity abounded.
Then we got a new pharaoh. Despite his affinity for the Bible, he ignored the wisdom of Joseph and gave the national treasure away. Everybody got some, but those closest to him, the “Got Mines” and the “Got Mores” got most of it. He started a war, got bored with it, started another war and ran it badly, squandering borrowed money to pursue his dreams of global oil hegemony. He repealed or refused to enforce laws that protected investors, saying that thieves would lose and honest investors gain, simply by the natural functioning of the marketplace, apparently in the same way that closing all police precincts will protect us from crime.
In eight short years, his rule transformed us from the world’s wealthiest creditor nation to the world’s greatest debtor. Policies begun under Ronald Reagan and pushed even further by George W. Bush, caused wages for working people to stagnate. The percentage of income going to the top 1% of the US population now stands at 20%. The last time US income distribution reached that degree of concentration was 1928, and the greatest herd of Lean Cows in our history stampeded across the landscape.
The greatest herd until now.
One definition of insanity is doing the same thing repeatedly and expecting a different outcome. The conservative economics of the 1920′s returned with a vengeance under “Supply Side” Republican rule, beginning in the 1980s, and despite a respite under Clinton, ground inexorably toward the same result. In a rational economy, under a rational government, the cyclical nature of reality is acknowledged and, like Pharaoh, or any wise householder, the fat years’ surplus is retained and disbursed during the lean years as a way of maintaining social stability. (Economists, especially the Neo-conservative economists whose principles ruled until recently, just love the work rational. Here I will cite the computer programmer’s rule: GIGO Garbage In, Garbage Out. The most perfect logical process is only as good as the data fed into it.) Where a rational person would look to savings to get them through the lean times, just as Pharaoh did under Joseph’s wise guidance, we find that they and their theories have squandered our sustenence. We’re like the woman who lost her job and discovered that her husband had gambled all their savings away, and run up massive credit card debt, as well. She has to buy groceries. Is it wise to use her credit card? No. Does she have a choice?
Getting back to Holy Writ, it’s interesting to see that the Communist Chinese are better at following it than we are. When times were good, and we bought everything they could manufacture, they saved, both as individuals and as a nation. Now that trade has fallen off, their government, using the surplus they conserved, has launched massive infrastructure spending to keep employment up. They did it right. We, with our emphasis on forgetting that the government is the collective arm of the people, not some free-floating entity, allowed our government and ourselves to become wastrels, and are now discovering the results of that policy.
There’s another biblical concept I’d like to bring up: Charity. People often think of it as an unpleasant thing you do for the moral brownie points, like eating spinach or flossing. Others point out that givers get at least as much of an emotional boost as recipients. I’d like to propose a third possibility. Just as the Ten Commandments provide a behavior code that reduces interpersonal conflict in society, Charity, the cycling of resources from the top of the heap to the bottom, keeps the economy revving. I will go further and suggest that the effect is the same, whether the mechanism is personal choice, minimum wage laws, or progressive taxation.
It’s no coincidence that financial jargon uses terms related to water: liquidity, frozen assets. When the well of consumer spending runs dry, when the rain of charity doesn’t fall from above, the crops fail, and the cows get skinny.
Casey Jones, CEO
Conservatives, clinging to their principles, still maintain that if everyone simply were to look after his or her own interests, the world would function perfectly; that regulations and rules are unnecessary. For those of you who haven’t been paying attention, let me explain why this hasn’t worked.
CEO example #1, let’s call him Angelo Mozillo, makes his fortune by selling mortgages. While banks lend money and patiently wait for it to trickle back to them in the form of principal and interest, drop by monthly drop, Angelo figured out that he could make his profit on closing costs and fees and sell the mortgages to those desiring a steady income, freeing up his capital immediately to loan out for new mortgages. Brilliant!
The low hanging fruit is picked, and his employees, to meet their quotas, are forced to reach higher and higher up the tree, or deeper and deeper into the bottom of the barrel, pick whichever metaphor appeals to you. But hey, everybody wins: buyers get mortgages, employees get their bonuses, investors get their perfectly safe mortgage-backed securities, and Angelo gets rich.
Which brings us to CEO #2, let’s call him, um, Mitt Romney. He makes his fortune by buying failing companies and restoring them to profitability. The biggest tool in his drawer is reducing labor costs. Obviously, it works. He’s worth (before presidential campaign expenses and possible recent stock market losses) about half a billion dollars, or approximately $10,000 for each of the 50,000 American workers he has downsized.
But hey, his remaining employees are happy to have jobs. That has to count for something.
The lure of low mortgage rates generated record sales, and the consequent demand pushed housing prices up. Meanwhile outsourcing and layoffs increased the supply of available workers, keeping wages low.
Now, you have two formidable wealth-generating engines hurtling down the tracks. The only problem is that the tracks are not parallel. At some point the Making Mortgage Payments track will intersect with the Laying Off Workers track. That point being approximately Here, and Now.
Who could have seen this train wreck coming?
Someone, it seems, was asleep at the switch. Oh, wait. There was no switchman. What do switchmen produce? Nothing! Eliminate that money-eating, profit-destroying job, the fatty-assed bureaucrat! Switchmen just get in the way of the locomotives, telling this one to wait, while the other blazes past. No fair!
I’m not pretending that the above is some kind of brilliant insight. If I’d written it 5 years ago, maybe, but now the results are all to obvious for me to take credit for anything other than expressing it in cute metaphors. There is still a sizable group of Republicans, however, who cling to the notion that switchmen are unnecessary to the safe and continued functioning of railroads, metaphorically speaking, and I have to ask, what are they thinking? CEOs, by nature and job description, focus on the profitability of their own enterprises, and like locomotive engineers whose job is to focus on the track in front of them, they may well be unaware of the rest of their surroundings and where their train is in relation to other trains. Unlike the switchman, sitting high in his tower overlooking the train yard, they are not positioned to see the Big Picture. Few even try, although those who do, like Bill Gates and Warren Buffet, tend to be the most successful of all.
Or as the Grateful Dead so brilliantly put it,
Drivin’ that train, high on cocaine.
Casey Jones, you better watch your speed.
What Are Republicans Thinking?
I’ve asked that question a few times in my posts recently, and thought I’d spend this one at deductive reasoning, as in “who benefits from the policies Republicans favor?” I mean, these people occupy influential positions. They can’t be stupid. Or crazy.
Then Alan Keyes gave a truly gob-smacking interview in which he asserted that “Obama must be stopped by any means,” normally short-hand for assassination. And The New York Post printed the infamous dead chimp cartoon. Rush Limbaugh compared liberals to murderers and rapists. (Remember the fellow who shot up his ex-wife’s church children’s pageant? He said he did it because he couldn’t get to the real Evil Liberals.) And, in a lighter vein, Mr. Clean Airwaves, Rep. Eric Cantor, posted not just the obscenity-laden AFSCME remix, but a YouTube vid celebrating his party’s impotence against the stimulus to the tune of an Aerosmith oldie about having sex with a hooker.
Oh, yeah, back in the saddle again.
Okay, I am still going to write this piece, even though my premise, that recent Republican antics are not the product of dopieness, delusion, or, well, dope, may not be accurate.
Cui bono? Who benefits? This question has been used in criminal investigations since the Romans. Let’s look at a few Republican policies one by one, and remember the Underpants Gnome business plan:
- Steal underpants.
- ????
- Profit!
- Savaging clean water standards = a rise in sales of bottled water and water filters. Profit!!
- Reduction in mine safety standards = digging more coal out of depleted mines, workers lives be damned. Profit!!
- “Deficits don’t matter” when they result from massive government spending to defense contractors and massive waste and mismanagement of said funds. Profit!!
- “Deficits will be the death of America!!” when funds go to average people in the form of food stamps or unemployment benefits. It’s instructive to note that the Republican governors who quibble over taking Stimulus money seem willing to take all but those funds dedicated to extending unemployment benefits. Who benefits? Employers who can watch desperate people line up for the chance to get substandard wages and non-existent benefits. It’s also interesting to note how many of those governors are already well above average when it comes to Federal funds entering their states pre-stim. You’ll note that the spokesman for those governors is Tim Pawlenty, who along with Texas Governor Rick Perry (who just bailed on his resistance) is, the only one on the list who’s below average on that score. Louisiana, Alaska, Mississippi, and South Carolina all get more from the Feds than their citizens pay out. In addition, people without a safety net will be more inclined to deplete their resources (cash in their IRAs and 401Ks, sell or be foreclosed out of their homes, sell their jewelry, etc.) this would allow prices to fall further and Rich Dad, Poor Dad practitioners to sweep up assets at pennies on the dollar. In other words, Profit!!
- Opposition to healthcare: Medicare, Medicaid, SCHIP. Okay. I will grant that this results logically from the belief that no one should get anything they can’t afford to pay for, but here’s the problem. If your goal is to cut wages and benefits to the bone to maximize profit, then, the more you succeed, the less your employees will be able to afford health care. (See previous post, Casey Jones, CEO.) And in what way does having more sick people benefit American business? I’d like to hear the other side of that argument.
- Allowing infrastructure to decay = pressure to sell public roadways to cash-heavy consortiums who can afford to make the needed repairs, and then install tollbooths. Profit!!
- Oppostion to renewable energy, global warming remediation, and environmental concerns in general = continued reliance on oil and maintenance of the global power elite, plus cost-savings on environmental controls, with the costs pushed off the corporate books in the form of increased illness in downwind and downstream populations and remediation costs, such as Superfund sites and the horrendous clean-up of the recent fly ash disasters in Tennessee pushed off on the general public. Profit!!
I’m seeing a pattern here. It’s called creating economic pressure to put public resources into private hands, where they can create profit for those wealthy enough to own them, in tandem with shunting all costs away from the corporations and their owners to the general public.
The Republican Party serves the interests of the economic elite. They may make occasional noises about the Right to Life, (until you’re born) National Defense, (as long as it’s profitable) and Public Decency, (as long as you don’t listen to the lyrics of their YouTube postings or pay attention to Rush Limbaugh’s substaance abuse) in order to get votes from those who don’t belong to their country club, but their primary, eternal, platform is, “What’s in it for me?”
Their Pork, Your Pig Farm, My Porkchop
Ok, let’s take on the steaming issue of the day, at least according to Congressional Republicans.
Pig odor.
Don’t know if you’ve ever lived on or near a pig farm, but it’s not something that will make you rave about fresh country air. Used to be that people lived in cities and towns and pigs lived on farms. The people who lived on the farms with the pigs were sort of looked down upon by the city folk, but now they’re called “neighbors.” We had this post-war suburb boom, and a real estate boom, and well, the cities melted into puddles of suburbia and the puddles began to lap up against the pig farms. Somewhere over the course of this, the US population doubled (1945-72, to be precise) creating the need for all that new housing.
And the city folk who had moved into the suburbs, thrilled to get all that space at such a great price when they signed the agreement in, oh, December, turned to each other in April and asked, “What’s that smell?”
As a Georgia farmer once said to me, “Smells like bread and butter to me.” To the suburbanites, thinking What will this do to my property values? Well, not so much.
Voila! The birth of pig odor research, a perfectly reasonable strategy to balance the comfort and real estate values of non-farmers, the economic interests of farmers, and the food budgets of all of us who eat pork.
Congressional Republicans who, other than Tom Harkin, apparently do not live downwind of pig farms, are enraged and have singled it out as the poster child of all of the 9,000+ earmarks available for public scorn. The fact that they are ranting, in many cases, against their own earmarks, inserted into the budget before Obama’s election, much less his inauguration, bothers them not one whit.
It’s a game of Gotcha, which, of course, Republicans abjure. (See Sarah Palin’s comments re the gotcha nature of that most softball of questions, “What magazines do you read?”) Now, with three days to the shutdown of several Federal Agencies if the bill is not passed and signed, They Who Write Earmarks cry, “Obama must not sign this, or he as bad person! A hypocrite! Hah! We Told You So!” This will be embroidered by the Four Horsemen of the Conservative Apocalypse: Limbaugh, O’Reilly, Hannity, and Coulter, into a full fledged Tapestry of Doom.
Just remember their concept of morality, “It’s only okay when we do it.” And then ask, WWRD? What Would Republicans Do? Hmmmm….government is not the solution. Government is the problem. Science is poopadoodle. What does that leave, exactly?
The Suburbanites sue the Pig Farmer for creating a public nuisance. The Pig Farmer points out that his family has been raising pigs there for four generations, that there was no problem until the developer built the neighborhood, and sues the Suburbanites for, I dunno, restraint of trade. Its hard to see this coming out any way other than a/ making millionaires of a bunch of trial lawyers (Trial Lawyers! Sacriledge!) or reciprocal mobs armed with torches and pitchforks. Pig odor research sounds positively civilized, nay, sensible, by comparison.
The Conservative Logic Loop
According to Rush Limbaugh, speaking at CPAC, the basic Conservative principles are “Life, Liberty, Freedom, and the Pursuit of Happiness.” He mis-attributed it to the Constitution, which opted for “Life, Liberty, and Property” and stuck that redundant “Freedom” in there, but I’m not here to quibble.
According to Jonathan Krohn, the 13-year-old actor, Bill Bennett fan, and CPAC wunderkind, the four pillars of Conservatism are respect for the Constitution, respect for life, less government, and personal responsibility. I mean, what’s not to like? We will all be law-abiding citizens, having sex only when we desire to bring an additional child into the world, paying our bills on time, and with perfect honesty and self-control. Who can argue with that, other than a depraved pervert?
Well, me, apparently, hard-working, bill-paying middle-aged, middle class housewife and mother that I am. I don’t have a problem with any of those principles, per se. I’d just like to look a little deeper and see just how the implications of those principles shake out, because there, I think lies the problem confronting the Conservative movement.
Back when I was in high school, during the Dreaded Sixties, “Freedom” was not a Conservative principle. The Civil Rights Movement and the Hippies had laid full claim to that turf, and Conservatives aligned themselves firmly behind the phrase “Law and Order.” (And if Law and Order does not imply a strong government, just what does that phrase mean?)
How short and fleeting is Memory! I can’t fault Jonathan for that, pre-embryo that he was in those days, but Rush really is old enough to know better. (I suppose it would be appropriate to contrast his terror of “Democrats choosing our candidates” in open primaries to his gleeful endorsement of “Operation Chaos” in which he encouraged his minions to vote Hillary in open Democratic primaries, as proof of his obviously short memory. Or something.) The mill of the gods grinds slowly, Rush, but it grinds exceedingly fine.
Anyway. Edward Peter Fitzsimmons was my English teacher in my junior year at Northern Valley. A tall, imposing sort, resplendent in his handlebar mustache and 3-piece suits, heavy gold watch chain draped across the brocaded expanse of his tummy, he devoted his life to out-Britishing the British. “Freedom,” he intoned one day in class. “Whenever someone says ‘Freedom’ to you, ask them ‘Freedom from what and Freedom to do what?’”
Just asking, Rush.
I suppose Rush would respond “Freedom from excessive government regulation,” but then there was that unfortunate other applause line in his speech, the one about Conservatism “protecting the people.” Okay, from what? And more importantly, how, if not by Government and Law? I find it interesting that Obama’s taking hits from the Left regarding his reluctance to reverse Bush’s draconian, unconstitutional, and tyrannical Unitary Executive policies, while the allegedly anti-governmental-power Right remains mum on the topic. They’re all in a lather over economics, bringing us back to that Life, Liberty, and Property thing that the Constitution actually states and Rush sort of tap-danced around. Freudian slip? Code-talking? Bone-headed ignorance? Who knows?
One has only to look at the Food and Drug Administration for an example of the Conservative contradiction. Initiated by that Republican icon, Teddy Roosevelt, it protected the people against profit-oriented food processors’ inclination to cut corners and include bits of rats, feces, or missing employees in their products. Ronald Reagan, in his “government is the problem” monomania, cut FDA inspection funding, Bush cut it further, plus handed the keys to the office to a cattle industry lobbyist, and essentially killed nine people and sickened tens of thousands with just the resulting peanut fiasco alone. The Market will handle the problem, you see. If people die from eating your product, they won’t buy it any more. If their friends and relatives figure out just what it was that killed thm, they might not buy it either. God forbid some government scientist should figure out just what sickened people and who was responsible for its production.
Let’s continue to employment practices. If the bottom line is all that matters, then labor unions are obviously a bad thing. They’ll stand together for good wages and working conditions. If you mistreat one employee, the rest of them might gang up on you. Looks to me like a system that would allow Management and Labor to work out their differences without the need for the government to become involved, but apparently not to Conservative Logic. Okay, so you have a powerful corporation with a cash flow equal to or greater than any number of small nations on one side, and you have the fifty-two individuals whose plant just got shut down packing up the machinery for a trip to one of those smaller nations on the other. This is the Conservative ideal of fair and balanced. Fortunately, Conservatives also believe in widespread gun ownership. Okay, I can’t fault their logic on that one. They don’t call guns “The Great Equalizer” for nothing. It’s the implications that I don’t like. The possibility that a plant manager might get shot for carrying out orders that he might not be jazzed about himself, or that the displaced worker might take that personal responsibility thing literally and do away with himself and/or those mouths he can no longer afford to feed. A creepy thought, but it happens, especially if your governor believes it’s wrong for people who don’t work to get anything to tide them over until they find work again.
Then there’s that notion that we’ll have plenty of willing buyers keeping up on their payments while their paychecks shrink or disappear entirely.
And immigration. On the one hand, we don’t want hordes of “them” taking our jobs, on the other, we’re not williing to live three families to an apartment in order to be able to live on what “they” are willing to work for. God forbid workers should band together for decent pay. That would be Class Warfare. Downsizing workers and replacing them with underpaid illegal immigrants, however, is not. It’s Business as Usual.
And then there are those god-awful environmental regulations, you know, snail darters, owls, whatnot. Why protect them? Leaving aside the concept of the canary in the coal mine, in which the animal provides a status report on the health of the environment (which we rely upon for our existence, as well) or the notion that certain pieces of land, although of little intrinsic commercial value, provide unpaid service to us (example, wetlands protecting New Orleans from storm surge, exchanging carbon dioxide for oxygen, and providing breeding grounds for shrimp) we still come up against that right to life thing. So only humans have a right to life? And if the life forms—plants, animals, microbes—that support human life are degraded to the point that they can no longer do so, then what happens to everybody’s right to life?
While we’re there, lets look at the more narrowly defined right to life. Oddly, some of those who are most vehement on the subject of abortion, the underlying logic being that only unmarried people who hate children would ever get one, are also against contraception. The logic is that contraception increases the incidence of out-of wedlock sex. I have a secret to share. Married people have sex, too. Last I checked, it was a major reason for getting married in the first place. And a marriage license is no guarantee of a job, and what is more responsible than loving your spouse while planning to have children only when you know you can provide for them? So now Conservative principles, or at least the most extreme adherents of them, are in essence asserting that only people with money get to have sex. Or perhaps that children are God’s punishment for having sex. That should get them a lot of votes.
And there’s the other end of life. Terry Schiavo became a cause celebrè when her life support was terminated, but she’s not alone. It happens to people who don’t have million-dollar settlements to fund their hospital stays. Without a single protest, without a single Congressional eyebrow being raised, without the self-appointed guardians of sacred life giving a tinker’s dam, hospital boards vote to terminate life support to patients who can’t pay their bills. Meanwhile, Conservatives assert that people who can’t afford to pay for health care shouldn’t get any. Oh, and that the evil trial lawyer who got Schiavo that malpractice settlement should not have been allowed to do so. Okay, please explain to me how that “right to life” thing works again?
The strange being that Conservatism has become is currently self-destructing under the weight of its own contradictions. Their “leadership crisis” springs from the underlying reality that those who most proudly flaunt the conservative banner are blind to those contradictions. The ones with sense have abandoned the cause.
Pig Addenda
Just a note pertaining to a previous post, Their Pork, Your Pig Farm, My Porkchop:
Pig odor is not just about aesthetics. Eau de Hogfarm is linked to a host of ailments including depression and asthma. You can read about the scary details here. Kudos to Salon.com.
Like other environmental issues, it’s a public health issue. Why do Republicans think that’s so funny?
Where Do I Sign Up?
Poltico just outed the Vast Left Wing Conspiracy known as Journolist. OMG!OMG! Liberals talk to each other!!!! How evil!!! Where do I sign up?
Apparently the fact that some reporters and bloggers get story ideas from other reporters and bloggers, as opposed to, say, reading about them in the newspaper or seeing them on TV, or hearing them on the radio, or–god forbid–in person is evidence of Nefarious Doings.
Apparently, this is also proof that the Bush White House memo-fueled Right Wing Echo chamber never existed. (I’ts apparently falling apart without those daily faxes. Within the last week or so Bill O’Reilly announced victory in the War on Terror while Sean Hannity announced surrender in the same alleged war.) Or that Sun Moon never funded the Washington Post, or that Reagan’s White House Office of Public Diplomacy never threatened journalists and editors who strayed beyond the Spin Zone.
This is the classic Right Wing excuse for everything. They’re doing it! They did it first! When they do it, it’s evil, but when we do it, it’s good! Because we’re the Good Guys! And they’re the Bad Guys, so everything they do is Bad! Go ahead, substitute any word you want for ‘Journolist”… How about “torture”…”suppression of human rights”…”teenage pregnancy”…
Just because they are morally and politically bankrupt, don’t expect them to go away. Hell, AIG’s still in business.
ps–if you google “journolist” you will find this excellent site on internet skills for journalists (and anyone else interested in research.) This is a great resource and worth bookmarking.
Smackdown on the Right!
I heart Megan McCain. She’s the Athena of the Republican Party, doing long-overdue battle with the Harpies. So far, so good. Maybe the Party can be pried loose from the death grip of the extreme Right.
But still, the fact that the biggest thing in the Republican Party right now is, essentially, a trash-talking match in the girls locker room (“She’s fat!” “Kiss my ass!”) doesn’t bode well for the Party of Ideas.
And what about the Rushbo? Over in Limboland he’s sticking up for the outsized payouts to the guys who trashed the economy. Apparently his philosophy is that destroying global capitalism is a tough job, but somebody had to do it. I’m wondering if his legions of working class dittoheads are going to parrot that one, particularly those employed in the automotive industry, or if he just self-destructed. The concept of Rush Limbaugh jumping the shark brings up amusing, but highly disturbing, mental imagery.
Cool Tools!
I’m adding a few links to my sidebar. Up at the top right, by clicking the orange doohickey, you can be automatically notified each time I publish a new post.
I’m belatedly adding Journolist to my sidebar. No, not the infamous Journo-listserv where Liberals allegedly plot to take over the world, but an excellent site that will give you a full set of internet tools to do your own research, and handy how-tos on how to use them.
My son sent me this link, modestly titled “The Most IMPORTANT Video You’ll Ever See.” The real title is “Arithmetic, Population, and Energy,” and it gives the clearest and simplest explanation of the intertwined problems of energy use, population growth, and resource depletion I’ve ever seen. There’s an address at the end of Part 8 if you’d like your own copy, but no price info. If you have a way to get your favorite conservatives to sit down and watch it, it might be worth it at any price, if only to watch their heads explode.
The Sunlight Foundation website will give you the ability to see what Congress is up to, using a variety of links that enable you to slice and dice data relating to federal legislation. It also links to a slew of other sites busily slicing and dicing Federal information. For example: Who sponsored that bill? Who contributed to their campaign? Who made a profit on the project that bill funded? Expect to see connections.
And finally, Firedoglake’s Jane Hamsher has been looking into the above connections regarding Senator Evan Bayh’s Conservadem quest against Obama’s policies. It appears that, among other things, he has a problem with the notion that owners of properties bought at inflated prices should have their mortages reduced to avoid default, which would give mortgage companies a haircut as well. She discovered that the good Senator has accepted a million dollars in campaign contributions from the Finance industry. Wonder if she used the Sunlight Foundation website?
What’s Happening?
It’s been a fascinating few weeks. Mexico is pretty close to a Feds vs. Heads civil war, armed by us, Iraq continues to be a dangerous neighborhood, Afghanistan gets worse, and prepares to add us to the list of empires that ended their existence by invading them, screwy things continues to go on on Wall Street, with the screwers being paid handsomely by the screwees via the magic of the Bailout.
The Right has lit a major firestorm over Obama’s use of the teleprompter, which is sort of like criticizing him for being able to read. Michael Steele has declared that his feud with Limbaugh, and subsequqent groveling was a deliberate strategy to “discover who the enemy is and who’s inside the tent.” I’m not sure whether he ascertained that Limbaugh is the enemy or “inside the tent,” but I sure wish that the interviewer had asked. Michelle Bachmann is determined to protect us against our dollars not being the world’s default currency, by writing a bill that prevents us from doing something that has nothing to do with creating a worrld currency. House and Senate Republicans unveil their budget outline template, or, in the words of Captain Barbossa, “More like guidelines, actually.” I really like the part about how we will get out of debt by reducing taxes by 30% on the taxpayers who allegedly pay 87% of all income tax. Palin’s high schoolish V.P. debate performance was due to her not being able to get anyone to pray with her beforehand, not due to any lack on her part. Glen Beck wrapped a dead fish on his show [I could not, for the life of me understand the point., but he seemed to think he was pretty funny naming it Larry and talking to it.] Oh, and Samuel “Joe the Plumber” Wurtzelbacher is horny.
It’s sad to watch a once, or at least occasionally, great party (Lincoln, Eisenhower) fall into babbling incoherence. It’s even sadder to realize how much power they still wield. It’s frightening to think that there are 16 nationally elected Democrats who are willing to stand with them against President Obama’s budget.
The Other Side of the Story
Go here to read essays by AIG employees:
There are 3 links to other stories at the bottom of this one. Their perspective can be summed up in the lyrics of a Bone Poets Song (Great pacific NW band, BTW.)
Deep in the dark, in the boiler room of plenty, we stoke the banker’s fire.
These are the people who work in the boiler room, talking about how those fat bonuses were a substitute for 15 years of not getting raises, of how those who relocated to London saw their rents multiply five times over while their pre-bonus paychecks remained the same. How they had their jobs put on the line by bosses who demanded they make trades they felt were unwise–and with that loss of bonus, which would put them into an economic hole if they quit hanging over their heads, they went along–and how the boss who pushed them into those unwise business practices is walking around with his more than quarter billion dollar net worth intact.
Okay, we”re talking about very well-paid wage slaves, but still, it’s interesting to see that the pattern that exists at the bottom of the socioeconomic heap permeates the entire system. As individuals, they are as subject to the “You can be replaced” threat as any busboy, and there are thousands of well-trained mathematicians and traders standing in line to take their places.
Employee Free Choice Act, anyone? What would our economic system look like if, say, the AIG Financial Products (AIGFP) employees had gone to their union rep complaining of their boss’s abusive behavior? According to them, his giant profits (built on sand) earned him carte blanche with his superiors, and life or death power over his subordinates. Were they just chicken, or was this a situation in which having the sort of countervailing force that comes from being a member of a large organization, devoted to employee interests, could have created both better working conditions, more equitable pay, and more honesty and transparency in the business itself?
When will we learn that the power of the elite Few can–and must, in a Democracy–be balanced by concerted action on the part of the Many? That it’s okay, wise, and perfectly normal to join with others in the pursuit of common dreams. That the Cult of the Individual is a sham, foisted upon us by those who would use the oldest techinique in the imperial arsenal to their advantage: Divide and Conquer.
Thanks, Joe!
Joe Conason, writing at Salon, brings up an interesting point. Okay, don’t be put off by the title, “Dick Cheney Was Right.”
Remember, back in the day, when Republicans insisted that “Deficits don’t matter?” I mean before they lost their shirts in the last election and decided that Deficits Will Destroy Us?
Joe makes a good point. Deficit spending got us out of the Great Depression. The humungous deficit spending package known as WWII not only stopped Fascism, (“The unification of State and Corporate power,” per Benito Mussolini) but also created the industrial base for three decades of unparalleled, widespread prosperity. To use the household metaphor that Republicans are so fond of these days, there’s a difference between borrowing to, say, build a house and borrowing to, say, go on a foreign adventure. There’s a difference between spending that hard-borrowed cash frugally on projects that will bear fruit later on, like, say, planting fruit trees or putting your kid through college, and blowing it at the casino.
It’s not the size of the deficit, it’s how you use it.
Of Pirates, and a Cup of Tea
I suspected that the Navy Seals would have something to do with the release of Captain Phillips. The news is full of it, and rightly so. But what I find interesting is that all the experts talking about what to do about the situation ignore its source.
Somalis turned to piracy when foreign fishing trawlers depleted their fisheries and industrialized nations began dumping toxic and radioactive waste in their waters. What passes for a Somalian government is not able to fund a Navy or Coast Guard to keep the giant factory ships and garbage barges out. As desperate people tend to do desperate things, the result was piracy.
But wait! There’s more! For an excellent article, click here.
Yes, it’s a business. Lassiez-faire incarnate. I can hardly wait for Grover Norquist to start praising them. A government small enough to be drowned in a bathtub, indeed.
An on another rightward note, if you are over 18, and were not aware of the term “Teabagging” prior to the Fox News flogging of the tax day protest, click here. I’ll wait.
I must admit, this is not my father’s Republicn Party. Actually, you might want to watch David Schuster pinch hitting for Keith Olberman last night (story #4 on Countdown.) before you google. Then watch it again afterwards and count all the jaw-dropping double entendres. (Sorry, bad image.)
If you’re wondering how these dots connect, please read Thomas Frank’s The Wrecking Crew: How Conservatives Rule a book my wonderful kids gave me for Christmas, and which I’m finally getting around to reading. Written in impassioned, well-researched, and occasionally wickedly funny prose, Frank deconstructs the recent swelling tide of Republican corruption, blows the cover off their justifications for same, (“Freedom!”) and makes the connection between what the nation has recently experienced and the historical motives for our first Revolution.
Go on, click the link. It’s got that cool “Look Inside” feature. You’ll want to read more.
Oi! Oi! Blagojevich!
Now he’s been offered a reality show, at $80K per episode, yet.
It got me thinking.
How can I f&#k up badly enough to get offered that kind of money? I mean, this has become the American road to success. I always thought my problem was that I was weird. I mean, there are so many extraordinarily popular things that leave me baffled: NASCAR, American Idol, George Bush (well for a while, anyway). Now I find out that the problem is that I’m not weird enough.
Texas Tea Bags
As members of his audience chanted “Secede! Secede!” Texas governor Rick Perry announce that he agreed with them.
Well sort of, not really, um, he did take the $17 billion, after all.
But still, there were American flags all over the place and constant references to the Founding Fathers. So why is it that real patriots want to destroy the United States?
Republican Pirates
Well, I wondered when this would come along, and didn’t have to wait long. Rush Limbaugh wept crocodile tears for the deaths of ”black, Muslim, teenagers” on the order of President Obama. And referred to the pirates as “Merchant Marine organizers.”
Scroll down to yesterday’s post, to the link to the Foreign Policy magazine article, “The Pirate Economy.” Oh, heck, I’ll save you the trouble of scrolling.
Where to start?
Words fail me, so I will turn the blog over to my evil right-wing twin, Rhonda Rayguns, to explain.
“Pirates are the coolest example of pure lassez faire capitalism out there! No rules! What could be better? You see, it’s the way of nature that the strong should succeed and the weak get eaten, right? I mean, it’s a business. You’ve got wealthy Somalis without jack shit to invest in, I mean Somalia’s practically a desert. So they look at this great profit opportunity, all those big freighters and oil tankers cruising past and they see an opportunity. They finance starving fishermen, buy them guns so they can attack the ships and hold them for ransom. This is called “job creation.” How could anyone in their right mind be against creating jobs for poor fishermen? I suppose we’re just supposed to send them free food? And it gives further stimulus to the global economy by all that money moving through insurance companies, and then, of course, there will be future job creation as the merchant ships arm thenselves and hire mercenaries. See, it’s a win-win situation!”
If you don’t believe me, read Thomas Frank’s book, particularly the chapter, “The Bantustan that Roared” about Saipan, a beautiful tropical island that has become one of the sweatshop hellholes of the world. (Part sweatshop hellhole, part horny tourist mecca, actually.) Well, Somalia’s not quite up to Saipan’s level. You see, Saipan actually has a government, one controlled by the businessmen running the sweatshops, and it has a police force, which it really needs. Otherwise, who would go out and beat the snot out of those uppity guest workers when they ask for decent working conditions?
When you look at the rhetoric coming from the Right, about secession, about protesting Obama’s tax cuts, about the general hatred and loathing of all things Government, right down to public schools, you really have to wonder what their goal is.
So long as you are looking at the guys carrying signs and wearing funny hats out in the street, nothing makes much sense, unless you figure that just by getting pissed off you can bring back a job for hubby that will let wifey stay home and homeschool the kids. Okay, maybe you have to click your heels together three times, or something.
Never mind that American corporations massively increased their profits by outsourcing better-paying manufacturing jobs. Never mind that $100 billion taxable dollars each year sit tidily in off-shore bank accounts, running up tax bills for all those guys with tea bags decorating their hats. Never mind that American post-WWII prosperity rested upon the bedrock of cheap oil prices and abundant domestic supplies, which increased drilling will not restore.
“We’re running out! “
“I know how to fix it! We’ll use it up faster!!”
Obviously, at least according to these guys, the reason they’re feeling the squeeze is: Taxes!
However there’s another way to look at all this. it’s a concerted effort by the biggest of businesses and their owners to eternally and infinitely increase their profit at the expense of everyone else. And the consequence of that, which history has shown over and over, (including the society contemporary to our original Revolution) is tyranny, the rule of the many by the few.
In this brave new world we live in, all this talk of destroying the rights and livelihoods of Americans is now called Freedom, and ripping the country into a collection of sovereign states, Patriotism. Let’s hope the dittoheads wake up to how they are being manipulated soon, before they get what they ask for.
Tea
I’ll let the essay speak for itself. Thomas Hartman, writing over at Commondreams.org, began his education on hte Boston Tea Party after he came across a copy of Retrospect of the Boston Tea Party with a Memoir of George R.T. Hewes, a Survivor of the Little Band of Patriots Who Drowned the Tea in Boston Harbor in 1773 in a used book store.
The Real Boston Tea Party was an Anti-Corporate Revolt
For those of you who don’t have the patience to read a whole essay, I’ll pull a few of my favorite quotes:
Unemployment was exploding and the economic crisis was deepening; corporate crime, governmental corruption spawned by corporate cash, and an ethos of greed were blamed.
and
The real Boston Tea Party was a protest against huge corporate tax cuts for the British East India Company, the largest trans-national corporation then in existence. This corporate tax cut threatened to decimate small Colonial businesses by helping the BEIC pull a Wal-Mart against small entrepreneurial tea shops, and individuals began a revolt that kicked-off a series of events that ended in the creation of The United States of America.
By comparison, the tea parties of 2009 were organized by FreedomWorks, Dick Armey’s organization, which organizes on behalf of the interests of giant corporations, including several who received the TARP money that so offfends the sensibilities of the teabag crew. Again, from Hartmann:
A pamphlet was circulated through the colonies called The Alarm and signed by an enigmatic “Rusticus.” One issue made clear the feelings of colonial Americans about England’s largest transnational corporation and its behavior around the world: “Their Conduct in Asia, for some Years past, has given simple Proof, how little they regard the Laws of Nations, the Rights, Liberties, or Lives of Men. They have levied War, excited Rebellions, dethroned lawful Princes, and sacrificed Millions for the Sake of Gain. The Revenues of Mighty Kingdoms have entered their Coffers. And these not being sufficient to glut their Avarice, they have, by the most unparalleled Barbarities, Extortions, and Monopolies, stripped the miserable Inhabitants of their Property, and reduced whole Provinces to Indigence and Ruin. Fifteen hundred Thousands, it is said, perished by Famine in one Year, not because the Earth denied its Fruits; but [because] this Company and their Servants engulfed all the Necessaries of Life, and set them at so high a Price that the poor could not purchase them.”
As Harmann points out, who does this sound like, the teabag crowd or the anti-globalisation demonstrators?
Anyone out there want to help me write a screenplay about the Boston Tea Party…I mean the one in 1773?
Defining Conservatism
After watching a TV clip re Obama’s little gift from Chavez, learning that the book is now #2 on Amazon.com, and that #1 is Mark Levin’s Liberty and Tyranny: A Conservative Manifesto, I went and checked out Mark’s book. I already have decades worth of reading under my belt re El Norte’s not too shining historical relationship with our fellow American nations.
Levin begins, of course, with the ringing words of the Declaration–well, actually, that comes a page or so later, after he defines Conservatism as “…a way of understanding life, society, and governance.” He then goes on to cite a number of Enlightenment figures as having given birth to Conservative thought. Locke, Montiesque, Adam Smith.
I looked at that, and it occurred to me that those men were the radicals of their day. They proposed ideas that were utterly opposed to the European hierarchical world view and allegedly “divine” right of kings to rule. They bolstered their argument against a divinely-sanctioned rule of the masses by the nobility with the assertion that God, indeed, was on their side. In fact, the “Conservatives” of that day, those who wished to “conserve” the existing social order, were staunchly on the side of the King, “For God and King,” as they proudly put it.
Maybe the problem is that the Conservatives need a new name, at least those who wish to parade under the banner of Enlightenment philosophers. Was it not American Conservatives who instigated Jim Crow laws and resisted the dismantling of segregation? Was it not American Conservatives who opposed Roosevelt’s opposition to the rise of Nazi Germany and his support of Britain under the Lend Lease program? Was it not Conservatives who opposed–violently–the right of American workers to peaceably assemble and freely associate in unions?
Maybe this is the real dogfight in the Republican tent. The intellectual heirs of those noble Liberal philosophers (which is what they called themselves) are somehow trapped in bed with the intellectual descendants of those who burned witches and homosexuals at the stake. They are in bed with those who never found a war they weren’t willing to send someone else’s kids to fight. With those whose allegiance to their right to property transcends any other consideration, such as other people’s lives, liberties, and property. Those who voted to deregulate interest rates and restrict debtors’ access to bankruptcy. To dismantle environmental protections. To grant no-bid contracts to war profiteers.
You can go to the above link to the book and read the first few pages. He segues pretty quickly from his noble definition of Conservatism to equate Liberal philosophy with”Statism,” or a blind belief that the bigger the government, the better, by which definition that Conservative darling, Mr. Bush, must be the biggest Liberal of all. I also could not help but notice that he did not quote a single liberal or cite a single source to back up his claim on that topic. Liberals, he maintains, are just gung-ho to destroy the individual in their quest for the perfect state. We are imperfect human beings, he asserts, but Conservatives understand that, and don’t get too bothered by it. Which somehow explains why prison populations ballooned under the Bush Administration and Republicans were able to win elections by such tactics as calling triple amputee Max Cleland a coward and that whole thing about John McCain’s alleged “black baby.”
After eight years of warrantless wiretapping and torture under Bush, it’s the Liberals who are trying to destroy our Constitutional underpinnings. (Okay, I’ll admit Obama has me nervous on that point these days.)
But still, yikes!
Although I give him credit for his historical references to Locke, et al, I find him engaging in the usual Right Wing game of attributing every evil to The Other, and all virtue to one’s co-believers.
Here’s my definition of Conservative, “One who wishes to hold onto current structures, because one finds an advantage in the existing structure.” For example, Jim Crow kept Blacks from obtaining decent wages and equal treatment under the law. While I grant that abortion opponents sincerely believe in the sanctity of unborn life, lack of choice regarding the number and spacing of one’s children does put women at a disadvantage in the work force, giving men an advantage when it comes to hiring, promotions, and raises. Discrimination against gays likewise diminishes their earning potential. Environmental regulations, their opponents freely admit, gunk up the profit machine by insisting that they clean up after themselves and leave at least a couple of stones unturned now and again.
If the vision of the Founders was truly enacted, there would be no discrimination against anyone. Period. The notion that the Founders were religious men has been disproven over and over. They were Deists, Freemasons, for god’s sake, believers in God as Reason, not as a spiritual being. The notion that the Bible is the source of all morality is likewise ignorant nonsense. While Social Conservatives do sincerely believe that they have cornered the market of Moral High Ground, the agenda of the Republican Party has long been the protection of a wealthy minority by means of an appeal to anyone who will turn a blind eye to their own self-interest in order to further their own hobbyhorse: ending the right of a woman to choose; diminishing the right of blacks, gays, or anyone defined as “other” to compete freely in the workplace; ending those pesky laws protecting air and water; secession from the United States.
High-flown rhetoric aside, this is the working definition of the current Conservative movement, and its near total dominance under Bush has sown the seeds of its destruction. As people are forced by economic events to notice that their own interests have been damaged by Republican policies, they leave. Of course, a parallel trend will take place, as the number of those who feel that they cannot compete in the workplace unless the deck is stacked in their favor will rise, as well. Not a good trend, that one.
Today’s prediction:
What passes for the Republican Party will become increasingly shrill, as those with any degree of moderation will become alienated from it. If the pronouncements of Hannity, Beck, Limbaugh, Malkin, Bachmann, et al signify a trend, the Party is looking to the militant fringe to bolster its numbers, pulling them in from the smaller parties to the Right, including the secessionist movement. (You’ll notice they’ve been making a full-court press for that constituency the past few months.) If you’ll read my earlier posts on Authoritarianism, you’ll find that such control freaks generally despise their followers as easily-manpulated idiots, and assume that they can, with a combination of smoke, mirrors, appeals to traditional belief systems, and cold hard cash, extend their control indefinitely.
Just like the Saudis fund the Jihadists, thinking to channel their religious beliefs to turn their aggressive instincts outward, toward the Other, in order to protect their own status and wealth.
Ask anybody. The Saudis are very Conservative.
The Triumph of Democracy
I read an article recently that said that sales of Ayn Rand’s books were off the charts, particularly Atlas Shrugged, 50-page infodump of Objectivist philosphy and all. Then I read this article:
Thoroughly Modern Marx by Leo Panich. Foreign Policy Magazine, May/June 2009
And you know what? Sale of Karl Marx’s doorstop, Das Kapital, are likewise soaring.
I suppose it makes sense. Capitalism is in an existential crisis, and people are looking to source material to make sense of it. (Bible sales up, likewise.) Do take a few minutes to read the linked article. I’d read Rand, but not Marx (being more of a Groucho fan, myself) and found a few jawdropping thoughts in Leo’s article. A few choice quotes:
Such a system [capitalism], he wrote, “leaves no other nexus between man and man than naked self-interest, than callous ‘cash payment.’” Indeed, capitalism leaves societies mired “in the icy water of egotistical calculation.”
In other words, Marx refuted Rand a century before she wrote her magnum opus. Interesting. But my favorite is this one:
The resulting social isolation creates passivity in the face of personal crises, from factory layoffs to home foreclosures. So, too, does this isolation impede communities of active, informed citizens from coming together to take up radical alternatives to capitalism.
Marx would ask first and foremost how to overcome this all-consuming social passivity. He thought that unions and workers’ parties developing in his time were a step forward. Thus in Das Kapital he wrote that the “immediate aim” was “the organization of the proletarians into a class” whose “first task” would be “to win the battle for democracy.”
Yes, you read that right. Win the Battle for Democracy. Marx, Carl, founder of Communism. Interesting. But didn”t the original NeoCons start out as Marxists?
It’s even more interesting that those who today are most eager to establish Democracy worldwide just happen to be those who are dead-set against labor unions. This brings me to a point that I first noticed decades ago:
Democracy has become a code word for subservience to American business interests. That’s where the real battle is now, and in fact has been for the past forty or so years.
There are games being played with language, ones that George Orwell noted over half a century ago. So the question is, will we start paying attention?
New Ideas
The Republican Party is on the hunt, or at least part of it is. If you’ll scroll back a bit, you can read my prediction that the Party would split in to the Country Club, Social Conservative, and Libertarian factions, which we’re starting to see. The Libs and the Socials (I really love being able to apply those abbreviations to the Rightward side of the spectrum) have their philosophies pretty well hammered out and, despite repeated evidence that the majority of Americans do not share them, are convinced that eventually the rest of us will smarten up and see things their way. The Country Club set, however, is looking for new ideas. As John Stewart notes here, they pretty much rule out wide swaths of ideas before opening up the floor for questions, thus freeing themselves to just say no to everything that won Obama and the Dems the last election.
Although this is billed as a listening tour, the clips that I saw mostly featured the three official “listeners” giving opinions and those whose ideas they sought asking questions that sort of boiled down to “What’s in it for me?” (Example: “What are you going to do for small business?”)
I will allow that news organizations are more interested in quoting famous people than ordinary ones and that maybe the group wants to keep those new ideas to itself until they can polish them up a bit, but still. I’d like to ask some questions. Maybe someday they’ll make it out to a pizza place in my neck of the woods (I would highly recommend Wallery’s over in West Salem, OR.) But in the meantime, in the interest of letting them prepare, here are some questions I have. After all, they say they’ll listen to anybody.
Oops! Well, I just found out that the “Listening Tour” has been canceled by executive order of Rush Limbaugh. Still, I don’t want to tell them anything, just ask questions, so my offer stands. Here are the questions:
- America is a place where people can work hard and get rich. But what if some of the strategies used to get rich harm other people? For example: A company can save millions by not installing pollution controls. This can create a health care crisis, with millions of people suffering from things like asthma and cancer. Given that the Republican Party is against universal health care and has been against environmental regulation for the past 3 decades, how do you propose to deal with this problem?
- The Republican Party places a high value on individual effort and feels that government should have as little input into the private sector as possible. Often the pioneers are cited as role models, people who heroically tamed the wilderness, turning it into productive farmland. However, this view of history ignores the Homestead Act, by which the government gave away millions of acres of land for free or a small filing charge, and it ignores the role of the US Army and the US Bureau of Indian Affairs (both taxpayer-supported government agencies) in wresting that land from its original owners. It ignores the fact that the railroads were given rights of way, which they then leveraged via bank loans to construct the railways. (Both of these programs were signed into law by Abraham Lincoln.) What is the modern Republican equivalent of the Homestead Act? What are the industries of the future and how would a Republican-led government create an environment favorable to their establishment?
- Governor Romney, you are a highly successful businessman. You made your fortune buying up failing businesses and restoring them to profitability, which is a good thing. You’ve discovered a business model that works and have been busy replicating it. At the same time, banks make a tidy living making loans. They too, have found a successful model and use it over and over : lather, rinse, repeat. So we have a situation in which American businesses reduce their domestic labor force, sending jobs overseas, and people who previously could make their payments no longer can, and the whole economy falls apart. Can you see how this is like two freight trains, each intent upon its own journey toward riches, racing toward a place where the tracks intersect? Is there a role for regulation? If it’s not the government that regulates, who or what would? Given that business executives are trained to seek short-term profit, who looks out for the long-term interest of the nation?
- Republicans frequently cite the Founding Fathers and the original principles of our nation. Benjamin Franklin once said, “All the property that is necessary to a Man, for the Conservation of the Individual and the Propagation of the Species, is his natural Right, which none can justly deprive him of: But all Property superfluous to such purposes is the Property of the Publick, who, by their Laws, have created it, and who may therefore by other laws dispose of it, whenever the Welfare of the Publick shall demand such Disposition. He that does not like civil Society on these Terms, let him retire and live among Savages. He can have no right to the benefits of Society, who will not pay his Club towards the Support of it.”
Walmart is an example of an organization that has successfully used government programs (the Interstate highway system to move goods, Medicaid to provide its employees with medical benefits). Why does the Republican Party oppose asking those who have benefited the most from the system to contribute a higher percentage toward its support? - Who does menial tasks (harvesting, cleaning, food prep, etc.) if the wages for such work are too low and the working conditions too dismal to attract American workers? How do you balance the need to get those jobs done without mandating higher wages and decent working conditions or bringing in impoverished people from other parts of the world to do those jobs?
- Given that everyone understands the importance of Education in individual and national success, why do Republicans favor policies that divert funding from the public school system, weakening it?
It seems to me that until the Republican Party addresses these issues in terms other than the boilerplate terms “freedom,” “traditional values,” and “low taxes,” they will doom themselves to increasing irrelevance.
Quick Robin! The Backhoe!
Wow, just yesterday I mentioned my long-time belief that whenever you think the Republicans can go no lower, the rent a backhoe.
Their latest backhoe is Rick Scott. (Excellent article. Read it!)
This gentleman, a former Bush business partner at the Texas Rangers and financier of the Swift Boat Veterans for Truth, is now spearheading the fight against affordable healthcare.
As Rachel Maddow and her excellent research staff have discovered, Mr. Scott, as CEO of Columbia Healthcare, led an organization that defrauded the Medicaid and Medicare programs of enough money to justfy being forced to pay the biggest fine in the history of our nation: $1.7 billion.
He was forced out over it, of course, clutching his pitiful $10 million golden parachute. He’s since founded another business, Solantic, a chain of free-standing ER facilities in Florida, that he hopes to nurture into a national chain. While he claims he fears that government -sponsored healthcare will stifle competition and eventually raise prices, the fact remains that Medicare/aide is still the most cost-effective medical program out there. If you’d like to read more supporting that point of view, click here.
Also, while that first link leads you to an article that speaks well of Mr. Scott’s cost-cutting tactics, there are other opinions on the subject. And of course, there is a pretty obvious downside to employer-sponsored health insurance in a shrinking economy, as noted here. And here’s Danile Gross’ take on the subject from Slate.
I, Pencil
My son (who just graduated with his BS in Electronic Engineering Technology last weekend, Go, Jake! You rock!!) Okay, enough embarrassing my kid. Anyway, he brought this essay to my attention. Apparently, Michelle Malkin really likes it, as does Milton Friedman. You can read the whole thing here. For those of you in a hurry, it celebrates the miraculous nature of the humble pencil. (Leonard E. Read’s term, not mine.) It’s a sweet and enthusiastic essay on how millions of people must co-operate to create something as simple as a pencil: Sri Lankan graphite miners, Oregon loggers, the sailors who haul graphite from Sri Lanka, the campesinos who pick the coffee beans that keep the miners, sailors, and loggers functional, etc, etc. The part that struck me was this:
Here is an astounding fact: Neither the worker in the oil field nor the chemist nor the digger of graphite or clay nor any who mans or makes the ships or trains or trucks nor the one who runs the machine that does the knurling on my bit of metal nor the president of the company performs his singular task because he wants me. Each one wants me less, perhaps, than does a child in the first grade. Indeed, there are some among this vast multitude who never saw a pencil nor would they know how to use one. Their motivation is other than me. Perhaps it is something like this: Each of these millions sees that he can thus exchange his tiny know-how for the goods and services he needs or wants.
Okay, so far so good. People cooperating to create a product because somebody needs that product. It gets better, however:
I, Pencil, am a complex combination of miracles: a tree, zinc, copper, graphite, and so on. But to these miracles which manifest themselves in Nature an even more extraordinary miracle has been added: the configuration of creative human energies—millions of tiny know-hows configurating naturally and spontaneously in response to human necessity and desire and in the absence of any human master-minding! Since only God can make a tree, I insist that only God could make me. Man can no more direct these millions of know-hows to bring me into being than he can put molecules together to create a tree.
In the absence of “human masterminding?” Like nobody’s managing inventory at the pencil plant and ordering cedar slabs and graphite? Has this man ever run a business?
So my question for Read (alas, he no longer available to answer it) Malkin, Friedman, et al, is this:
If, as he says, that the miner, logger, and pencil company president each only contribute a tiny bit to the production of this amazing object*, then why is it that the Sri Lankan graphite miner lives in a hovel with his hungry children, the Oregon logger lives in a trailer, and the pencil president is a millionaire?
I think people can pretty much figure out how to create goods and services and buy them and sell them to/from each other. No problem with that. The Soviet master planners pretty much showed that their way of doing things didn’t work a-tall. But why is it that the rewards of all these miniscule contributions to the humble pencil are so wildly skewed?
Oooh, the Conservatives and Libertarians are going to scream over that line. I think it’s about balance, though. I keep coming back to Ben Franklin’s observation that not only is the accumulation of wealth addictive, it, like any other uncontrolled addiction, is ultimately harmful to society.
If I could get every person on the fact of the earth to give me a dime, I’d have $650 million dollars, but that’s not likely to happen. Half the world’s people live on less than $2 a day. They flat out can’t afford it. So, you see, that whole poverty problem, you could say, is a distribution problem.
It’s getting late. I’ll have more thoughts on distribution tomorrow.
Just asking.
* Read Hyemeyohsts Storm’s Seven Arrows for a passage relating to “the amazing object,” particularly the sentence “The amazing object died.” Then reflect on Read’s elevation of the pencil to semi-divine status.
I, Pencil, Too
I’m a day late with my continuation, with apologies. Got caught up in the Barry ‘n Dickie duelling national security banjos. Interesting stuff. Rachel Maddow was ahead of the pack, as usual, in picking out the fact that, while Obama eleoquently explained what’s wrong with the Bush/Cheney national security strategy, he’s proposing one that is even more illegal: indefinite preventive detention.
It’s an interesting conundrum. Cheney’s willingness to use extralegal means of getting information (apparently in his quest to prove things that weren’t true, but that he desperately wanted to be) have now created a situation in which the evidence, accurate or not, is inadmissable under law. Heck of a job, Dickie. Of course, seeing as the very thought of incarcerating terrorists in Super Max prisons [cue scary music] scares the beejeesus out of nine-tenths of the Senate, one can only imagine how popular letting them out on a technicality (a la Ted Stevens) would be. Obama’s got a real flaming bag of dog mess on his front porch. Neither stomping out the flames nor letting it burn is an option.
Bush/Cheney, the gift that keeps on giving. Evil geniuses who planned this out in advance in order to further totalitarian control of the increasingly restive populace or paranoid opportunists lurching from one crisis to the next? We report, you decide.
The other “best of” coverage was CNN’s word cloud, demonstrating visually that Obama spoke of Americans, detainees, and people, while Dick Cheney’s vocabulary is remarkably similar to Rudi Guiliani’s–a noun, a verb, terrorists, and 9/11. Without the dress. But I digress…
So, back to the issue of wealth distribution. I mean, what’s fair? I just read a NYT article about Vietnamese hot sauce. The guy started making the stuff decades ago in Vietnam, ground the peppers by hand, sold it in hand- packed baby food jars, saved his money, moved to America and is now selling $10 million a year worth of hot sauce, you know, the stuff with the green cap and the rooster on the bottle that is starting to show up everywhere. This is great! I have no problem with a good product making it’s inventor wealthy.
But down the road, here’s where a problem can develop. The issue is power. And face it, in our “money talks, bullshit walks” culture, Money = Power.
For example, when Ben & Jerry developed a dee-licious array of ice cream flavors and started to expand beyond their parlor and into supermarkets, Pillsbury, maker of Haagen Daz, bribed supermarkets to keep B&J off the shelves. The Vermont boys, being geniuses, triumphed, by making an end run around the massive Pillsbury legal department and taking it directly to the press and public with their “What’s the Doughboy afraid of?” campaign.
Not everyone is that clever. Or lucky. Watch Matewan, if you’d like a pretty accurate look at early union organizing. If you’re in a hurry, you can skip to the last 10 minutes or so.
The Boston Tea party is another example. No, they were not protesting “government” or even taxation per se. They were protesting Big Business abusing the British taxation system. Nobody died that night, but it set off a series of events that included numerous fatalties, AKA “The American Revolution.”
You could also look at Central and South America in the Eighties, where thousands of people “disappeared,” if you’d like to see what happens when 1% of the population controls 90% of the wealth.
The issue, as I see it, is not the size of Government, but who controls it and whose interests it serves. (That’s where that “eternal vigilance” part comes in.) You can read McMafia, if you’d like to see how a small, weak government is no defense of Liberty, unless you define “Liberty” as the right of gangsters to take over your country and run its economy. (As the late Gary Webb wrote, “Unlike many legitimate industries that merely pay lip service to the concept, the cocaine industry is a fervent believer in the get-government-off-our-backs philosophy of commerce.”)
This problem is not new. It is, in fact the problem that the Founders addressed.
“’Great wealth has never made a man happy. Rather than fill a vacuum, it creates one.”
–Ben Franklin
Or, if Ben’s not good enough for you, here is Justice Louis Brandeis’ take:
We may have democracy, or we may have wealth concentrated in the hands of a few, but we can’t have both.
At some point, the amassing of wealth turns into the defense of wealth. I suppose that some would say that the two are concurrent, at least for some people. What happens then is that the Haves see any attempt by the Have Nots to share in prosperity as a frontal attack. There have been a few extremely wealthy individuals who understand that this is not a logical position. Henry Ford paid his workers well, understanding that every employee who could afford to buy a car was a potential customer. Warren Buffett resists the British East India Company-like demands of his peers that capital gains be untaxed. But there’s more here. As Anna Chenault said, ”Power overpowers all reason.” (I’m sure she was talking about Communists, not powerful people like herself, but I think it applies to the Right as well.)
I’m going back to my favorite Founder, Ben:
All the property that is necessary to a Man, for the Conservation of the Individual and the Propagation of the Species, is his natural Right, which none can justly deprive him of: But all Property superfluous to such purposes is the Property of the Publick, who, by their Laws, have created it, and who may therefore by other laws dispose of it, whenever the Welfare of the Publick shall demand such Disposition. He that does not like civil Society on these Terms, let him retire and live among Savages. He can have no right to the benefits of Society, who will not pay his Club towards the Support of it.
Let’s look at an example of how this works. Would Microsoft or Apple be where they are today if the military hadn’t funded the development of the Turing Machine? If the military hadn’t developed the Internet, and Al Gore pushed through the legislation that made it more than a toy for the universities and military? Would they have access to as many skilled programmers if the State University system had not evolved? Yeah, taxpayer loot financed that, too.
Would Walmart, whose founder’s children have occupied the bottom half of the Forbes Top Ten Wealthiest individuals for as long as I’ve been paying attention, be able to function without the Interstate Highway System, another one of those ”pork barrel projects” that Conservatives and Libertarians love to rail against? Oh, they’d put their stuff on trains. Um, the railroads were kickstarted by the Civil War-era Railroad Act that gave free land to the railroad companies, who then mortgaged it to provide capital for the actual construction. And then there’s Walmart’s outsourcing their employee benefits program to the Feds by keeping their employees’ hours and pay so low that they can get on Medicaid. Sweet. See what Franklin meant about those who benefit most from the common changepurse being obliged to kick more back in? It’s not, as Grover Norquist would have it, “theft.” It’s paying your club dues, or, in the case of Walmart, paying for services rendered.
Okay, so what’s the fairest way to do this? Set limits on how much a person can own or earn? Nah, That would just drive high-achievers nuts, although I can see where executive compensation has gotten way out of line lately. Hand out a bunch of money so every one is “equal?” Nah. As long as there’s booze, bad health, and stupidity, we’d still have rich people and poor people.
Here’s a thought: following Franklin’s principles, why not tax higher incomes more steeply? There’s a certain amount of empirical data showing that it works: the 1950′s, when the top tax rate was 90%, the nation was remarkably prosperous. Keep in mind how a progressive tax system works: the first $8000 or so of every person’s income is tax-free. The next $20K or so gets hit at 10%, and it goes up from there. No, the top tax rate does not mean that that percentage of that person’s entire income goes to the gummint, just the amount over a specified amount, or “Bracket.” (If you already understand this, my apologies for being so basic, but a lot of people talk like they don’t. If you don’t believe my numbers, click here and remember that you start counting after all your deductions and exemptions are subtracted from your income.)
Some interesting math evolves when you raise the tax rates. First off, people have more incentive to give to charity, since that way they can control what the money is spent on, as opposed to just throwing it into the Federal pot. Second, businesses have more incentive to keep the money in the business, investing it in ways that improve the business’ functioning, or even benefit workers, as opposed to pulling it out and throwing it at fancy restaurants and thousand dollar shoes, not to mention abominations like Ken Lay’s infamous $6,000 shower curtain. (Those whom the gods would destroy, they first make mad.)
When the progressive income tax was a steep slope, the nation prospered. When it flattened, there was a burst of economic activity as the nation’s wealth shifted to the top, and stagnation since. Wealth moves from the bottom to the top. It’s source lies in the earth, in the form of raw materials and food. Human labor, often ill-paid, harvests it, and each step of the way to the consumer, it’s value roughly doubles. There needs to be a way to complete the cycle, returning liquidity to the bottom of the economic system, or the well runs dry. One way to do this is Charity, but Charity is voluntary and, since Ayn Rand, looked down upon. A progressive tax system, managed honestly, with the funds going to public entities: schools, libraries, hospitals, sewer systems, parks, transit, infrastructure, that benefit all is a highly effective means of doing this.
Sorry, Libbers and Conservatives, if you object to this notion. Go live among savages, and if the bridge to your island needs repairs, pass the hat.
A note: If you read carefully, you’ll note that I have no bone to pick with Read so far as the production end of things goes. My issue is with the distribution of the spoils, as it were, and lest you think I am against all things Republican, I’d like to say that one of the most brilliant government policies ever enacted came from Richard Nixon (bet you weren’t expecting that.) Revenue sharing. A portion of all income tax collected was divvied up and channelled to communities (with those with a lower tax base getting larger amounts) to be spent on community projects according to priorities set at the local level. I think it neatly got around the problem of low-income communities having little or nothing to spend on public works and its sister problem of some guy in an office a thousand or so miles away telling you what to spend the money on.
Republican Strategery 2.0
I just read a Huffington Post article wondering why the Right has pretty much abandoned abortion as its flagship issue in favor of the sinking ship of man-on-woman-only marriage.
A couple of points occurred to me:
First, the question is raised in the article as to why the Rightward side of the Christian spectrum is so obsessed with controlling other people’s morality. It’s the same reason that allowed Pat Robertson to blame Katrina on Pagans with a straight face. I noticed some time ago that the most vociferously Christian are prone to throwing Jesus overboard anytime His teachings conflict with the Old Testament.
14 But if ye will not hearken unto me, and will not do all these commandments; 15 And if ye shall despise my statutes, or if your soul abhor my judgments, so that ye will not do all my commandments, but that ye break my covenant: 16 I also will do this unto you; I will even appoint over you terror, consumption, and the burning ague, that shall consume the eyes, and cause sorrow of heart: and ye shall sow your seed in vain, for your enemies shall eat it. 17 And I will set my face against you, and ye shall be slain before your enemies: they that hate you shall reign over you; and ye shall flee when none pursueth you. 18 And if ye will not yet for all this hearken unto me, then I will punish you seven times more for your sins. 19 And I will break the pride of your power; and I will make your heaven as iron, and your earth as brass: 20 And your strength shall be spent in vain: for your land shall not yield her increase, neither shall the trees of the land yield their fruits.
–Leviticus 26
So to these literal-minded people, any violation of Old Testament rules, by anyone, means they will be subject to Divine Retribution. In that context, you can understand how see how same-sex marriage would utterly terrify them. Their heaven will be as iron and their earth as brass because of what some guys are doing in their San Francisco apartment. Burning ague!!
Okay, with that as a given, I would love to look at the results of their direct marketing efforts lately. I’m betting that line of research would prove fruitful. My thesis is that abortion direct mail campaigns have shown diminishing returns. After all, Obama’s very logical position that taking steps to reduce the number of abortions seems to be making inroads: that access to birth control, sex ed that actually educates, support for those women who want to keep their babies, and support for adoptive parents, will do more to reduce the abortion rate than treating children as God’s punishment for having sex. And then there’s the burnout factor. The issue has been flogged for so long, and to such small effect in changing abortion laws, that one would suspect that, well, the money is not rolling in the way it used to.
Am I saying that the pro-life movement are nothing more than a bunch of money-grubbers? No. Of course not. These people are sincerely concerned about saving the lives of babies. However, if you’ll read Thomas Frank’s The Wrecking Crew: How Republicans Rule, you’ll find that there’s a whole cottage industry behind the ideology of the Right, and that frequently the organizations whose names are on the letterheads of the begging letters end up in debt to the mail order houses. (And then essentially blackmailed into additional mailings in order to get out of debt. This time for sure!) So, in light of the $80 million raised by California’s Prop 8 opposition alone, and the fact that legal same-sex marriage is popping up across the country like dandelions in a suburban lawn, it would make sense that this issue would launch a thousand email campaigns. Ditto the Sotomayor nomination, pitched in the most derogatory terms to an audience with a documented dislike of people with non-English-sounding names. The Right is playing to the basest, most ignorant instincts on these issues, and by trying to raise funds with these arguments is displaying the low opinion it has of its base.
In keeping with the devotion to short-term profit displayed by the Republicans when recently in power, it would seem that this money-grubbing bottomfeeder strategy is what currently drives the Party, and is currently driving anyone with a timeline greater than three months and a concern for anything beyond their personal bottom line out of it.
Rush to the Bottom
I’ve said it before, but it bears repeating: every time you think the Right can go no lower, they get out the backhoe.
Today Rush Limbaugh, he who doubts Obama’s citizenship, who thinks Obama is worse than Al Qaeda, who wants him to fail, who introduced “Barack the Magic Negro” to the nation, has announced that the racist anti-semite who shot up the Holocaust Museum is a left-winger.
Keith Olbermann thinks Rush is crazy. BS, Keith. Rush is covering his vast expanse of ass. Sorry to use Anglo-Saxon language, but there it is. There’s a fairly good case to be made that Rush represents the mainstream edge of the extreme Right. Rush knows that he’s dancing on the edge of charges of inciting violence–not quite enough to get him an accessory before the fact charge, but enough to bring the wrath of every decent human being in this nation and beyond down on his head.
His reaction? To tell his followers that this sort of action is beyond the pale? Who? Rush? The guy who sent his cleaning lady out to score hillbilly heroin? The guy who thinks his thirty years of militaristic bluster is a fair exchange for having opted out of actual military service? The moral crusader who needed 60 hits of Viagra to get him through a Carribean vacation while unmarried?
Nope. All you have to do is blame the problem on your opponents. Is there any factual basis to the accusation? Nah. Logic, even? Not a shred. But that’s never stopped his horde of minions from swallowing everything he says whole.
So the question is, will they swallow this one, too? Will they decide that random murder is justified to protect the nation from Socialism, or Communism, or today’s dangerous -ism du jour? Or will they rise up en mass screaming, “How dare you call us Aryans ‘Commies?’” (Not holding my breath for that one, but it would be fun.) or will they, at last, see him for the manipulative, lying coward that he is?
Census Shenanigans and This Ghastly Week.
“…you’ve got to hope for a decent mail-back response rate, because the workload goes way up and the costs go way up if you don’t have a good mail-back response rate. And we simply do not yet know what the response rate is because we haven’t done it yet. But if it’s not in the mid-60s (%), it’s going to be both budgetarily and operationally very difficult for the Census Bureau….it’s up to the American people to do it. What can the Census Bureau do, other than put it in their mailboxes on schedule? And if they [the American people] don’t send it back in, they have to start knocking on the door. So there is the mail-back response rate and then there’s the willingness to cooperate in nonresponse follow-up[.]
Former US Census director Kenneth Prewitt
http://www.motherjones.com/interview/2009/06/census-uncensored
So, basically, what the cost-conscious Rep. Bachmann is advocating will raise the cost of the census and, if followed by her right-wing sympathizers, will result in their being undercounted for congressional representation and Federal benefits.
Look at the bright side: they don’t want the money anyway, and maybe, if enough of the people in her district follow her lead, her district will be eliminated.
Yeah, I know, all the stuff that had happened this week and this is what I’m writing about? I find much of it overwhelming. A civil rights struggle in Iran, (triggered by a questionable election, but fueled by decades of struggle and organization for women’s rights) yet another sanctimonious politician revealed to revere morality only as a blunt weapon to use on his opponents, and a celebrity death every other day or so: Ed McMahon, Farrah Faucett, Billy Mays, and the haunting end to the brilliant, tragic life of Michael Jackson.
He was a child star, and in many ways a child his entire life, surrounded by those who saw him as a never-ending font of money. As the details come out, it’s less a standard Ziggy Stardust tale of meteoric rise and fall, but the story of a man who from childhood was controlled by others to achieve their own personally profitable ends. There was a place in there, between leaving his father’s domination and before his health issues began to surface, destroying his face, his body, and the enormous promise of his talent, when jackson shone, releasing albums that dominated pop music.
The best writing on his death comes from the reporter who wrote his biography, writing in the British paper, The Daily Mail. Read it. It outlines the cadre of leeches who attached themselves to him and watched him die, while plotting to suck the last drop of lifeblood from him.
My condolences to his family, friends, and fans.
Going South in Carolina
According to South Carolina Governor Mark Sanford, God wants him to continue drawing a government paycheck. God apparently also wanted him to–how do you put it? Oh, yeah–”Cleave to his wife,” but apparently some commandments are optional. Not, like, engraved in stone, or anything. This is another example of the standard Republican rulebook:
Rule #1: It’s only bad when they do it. Followed quickly by
Rule #2: They must be punished for their transgression, and
Rule #3: But not us.
God notwithstanding, Governor Sanford will not resign for one simple reason. If he does, the next question will be, why not Senator Ensign? I mean if Clinton can get impeached over a bimbo, what’s Diaper Dan Vitter doing in Congress? Why are people still listening to potifications of thrice-married philanderers Rudi Giuliani and Newt “Impeach Clinton for his disgusting immoral behavior” Gingrich?
The Republicans have put themselves in an interesting predicament. They built a power base by cozying up to the holier-than-thou crowd. If they do the right thing by taking their lumps when they violate the principles they supposedly stand for, they lose votes in the Senate in the short term, but might redeem themselves with their Base in time. If they claim that their behavior should not be measured by the same standards they apply to everyone else, they keep their votes in Congress but risk losing voters who cling to those values.
But when’s the last time they thought long-term?
Yeah, I know, Carl Rove thought he was building a “permanent Republican majority.” The Neoconservatives thought they were initiating an era of permanent US world dominance. However, if you look at the means they used to try to achieve these goals, you’ll see that it was one short-term trick after another. Telling lies: about WMD, about 9/11, about Saddam Hussein and Al Qaeda, about the parentage of John McCain’s adopted daughter, Al Gore and the Internet,the list goes on. They demanded that lobbyists contribute to only their candidates, utterly failed to enforce laws that would rein in business behavior that profited their contributors, another list that grows with every headline.
No. They’ll stick with the short term strategy, and trust that their most fervent supporters will continue to be blind to their actions. They’ll count on our collective memory not extending all the way to November 2010.
The Governor Throws a Curve
Happy Independence Day!
In that spirit, Governor Sarah Palin of Alaska has announced her resignation. The media, of course, went predictably agoggle, not surprising, since the 24/7 Michael Jackson coverage was beginning to get repetitive [Will his mother be able to take care of the kids? No, dummy, the nanny will continue to take care of the kids and will be paid by Granny, or if Granny declines, by Diana Ross, out of the trust fund. Now shut up and let the family mourn.] Allegedly Palin neglected to give any reason for the abrupt move. The theories boiled down to four:
- Avoiding prosecution
- A desire to focus on running for President in 2012, without the bothersome timewaster of governing Alaska
- [According to Rick Sanchez] Pregnancy
- “I want to be with my family,” the explanation given by her friends.
Taking them in reverse order:
When was she ever not with her family. At public expense?
Pregnancy: been there, done that, while in office. 12-hour flight from Dallas while in labor. Nice display of your sexist street cred, Rick.
Running for president in 2012: Well, duh. More on that later.
Avoiding prosecution: Well, duh, and exactly how does this not connect to motive #2?
By quitting now, before any more of her and her family’s shenanigans hit the front page, she preserves what’s left of her credibility as a governor. Perhaps she’s hoping that, since punishment in the form of removal from office would no longer be an option, that everyone will stop digging.
I’m not betting on it, particularly in light of her intention to continue in politics.
“Part of her decision is she wants to spend more time campaigning for candidates,” Nick Ayers, the executive director of the RGA, told Fox News.
“She felt like she needed to make her colleagues around the country aware, so she had given us a brief heads up,” Ayers said of getting the emails. “We have known for a couple of days she was considering not running for re-election but it was news today that she had gone ahead and made the decision to fully step down and resign.”
So far, so good. Whistlestop campaigning is what she does best. She flashes that thousand-watt news anchor smile, lobs red meat at the crowd, and they eat it up. The question, however, is on whose behalf will she campaign?
From her resignation speech [emphasis added]:
And I’ll work hard for others who still believe in free enterprise and smaller government; strong national security for our country and support for our troops; energy independence; and for those who will protect freedom and equality and life… I’ll work for and campaign for those proud to be American, and those who are inspired by our ideals and won’t deride them.
I will support others who seek to serve, in or out of office, for the right reasons, and I don’t care what party they’re in or no party at all. Inside Alaska – or Outside Alaska.
Sophie Nelson kindly offered the governor advice in a Huffington Post article, sensible advice that boils down to “become a moderate Republican like me” and “become educated on world affairs.” Somehow, I don’t think La Palin will comply. Her schtick has served her well, so far. Why research when you can just lay your hand on a pile of paper and imply that all the answers are in there? Why bother learning the name of the top general in the Middle East when you can get it wrong and no one calls you on it? Take a look at the Salon article that inspired the recently revealed email exchange between Palin and Steve Schmitt during the ’08 campaign for more information on the AIP and their agenda.
No, she’s not going to run for president by building a Big Tent coalition. She’ll do what she’s always done, advocate for a theocractic nation in which the Federal Government is too weak to maintain order. It’s still a long way to the 2012 nominations, and so many things could change (such as the rumored potential corruption charges involving her free house and the coincidental awarding of the Wasilla Sports Palace contract to Todd’s housebuildin’ buddies becoming actual charges) but right now, look for a Palin/Romney cage match, and don’t be surprised if she, at the very least, threatens to take the Right Wing of the GOP off to Bull Moose land if she doesn’t get her way. She has consistently conflated her personal ambitions with God’s Will in the past, and so far, it’s worked out just fine.
Dances with Whales
I’m taking a break from my customary political fixation to share my recent birthday adventure. Last year we went to Crater Lake, a pristine body of water located a mile above sea level in the Cascade Range, in the remains of Mount Mazama, which blew its top about 70,ooo years ago, leaving a hole deep enough to accommodate the deepest lake in the US. A lake so deep that the only color of light that reflects back from its transparent depths is a jaw-dropping shade of blue.
The Phantom Ship at Crater lake
It’s surrounded by a narrow, twisting road, so narrow in places that the little white stripe that reminds you where the edge is has crumbled into the 1,500 foot drop giving way to that totally awesome view. On the other side, a cliff stretches up to the cloudless blue sky. In front of you, a Winnebago the size of a city bus approaches, taking up his half of the road, and then some, as he’s terrified of scraping the paint off his RV on the cliff, but not as terrified as I am of launching into the atmosphere. It also reminded me how smart I was to buy a teeny-weeny econobox.
I was fine while we were there, but had dreams of falling for three nights afterwards. This year I would celebrate at sea level.
So off we went to Depoe Bay, the “Whale Watching Capital” of at least this part, if not the whole world, also the world’s smallest bay, about the size of a little league ball field. On the way from the ticket booth, we descended hundreds of steps spiraling off the cliff to sea level. “It’s a good thing we’re doing this while we’re still young enough to get back up,” I joked. We excused our way through a dozen or so guys newly off the salmon fishing boat, happily counting the dull-eyed Coho filling plastic laundry baskets while they waited for the crew to gut and fillet them.
The boat left the dock and the shelter of the bay, bounding over the waves like a merry-go-round horse. I turned to my husband. “Did I mention I’ve never been on the ocean before?”
He smiled. “You are now,” he said.
We got to the whale watching grounds, about half a mile offshore, already staked out by another tour boat, this one a glorified rubber raft with half a dozen people and a golden retriever peering over the side, the one I’d wanted to be on, what with my fantasy of seeing the whale come up for air right next to the boat.
“Thar she blows,” the captain called out.
Ooohhs and aahhhs from the passengers in the bow. “Where?” I asked.
“Thar she blows,” he called again.
Maybe I was on the wrong side of the boat. In order to obtain the best view of the feeding grounds, he’d parked the boat athwart the waves. (I’m better with nautical language than actual nautical goings on. Obviously not completely proficient: see “parked” above. ) Each time a wave came in–every few seconds–the boat waddled like a big fat goose. I climbed in a generally starboard direction, clinging to the numerous handholds, then staggered to the rail as gravity reversed itself.
“Thar she blows,” he called.
I saw nothing. Other than the fact that everyone was looking in the opposite direction. Back to portside.
On the next surfacing, I saw it. A wisp of steam reminiscent of the smoke from a colonial re-enactor’s musket, without the easy-to-locate noise, hovered above a strip of whale about the size of a carpet runner and was immediately erased by the gentle sea breeze. I realized that “whale watching” was something of a euphemism.
Then I realized that my waistband felt uncomfortable snug. Maybe eating lunch right before getting on the boat wasn’t such a good idea. Instead of that tuna sub, maybe I should have had a stiff gin and tonic. That always worked against airsickness, and there is that longstanding connection between sailors and alcohol. I’d never considered the possible reason for that connection before. Still, although I’d had a history of carsickness as a child, and am perhaps the world’s worst flyer, I’d never had a problem with the motion of the ocean when body surfing six-foot breakers and didn’t anticipate any problem with the waves. I took a deep breath, and got a lungful of diesel exhaust. That didn’t help.
I felt uncomfortably warm and staggered over to a seat to drop my jacket. “Thar she blows!” called the captain, and the whale, now displaying as much skin as a mountainous par 5 putt-putt green surfaced, right next to the other boat. My camera dangled uselessly from my wrist.
I suppose you can imagine how the next 45 minutes went. That phase began with my asking the crewman, “Where’s the head?” (I told you I was pretty good with nautical terminology.) At least, I told myself, I was in the boat with a head.
Compared to the remainder of the voyage, walking back up those stairs and past another dozen or so tubs of dead fish was a cruise. In the same sense that the whale watching cruise was a “cruise.”
Next year, maybe I’ll go swimming with dolphins. I hear they do that in a pool. Or maybe I’ll just find some way to celebrate that doesn’t involve bodies of water at all.
See the whale?
My Healthcare Story
Lately, I’ve been massively concerned over the current health care debate. It’s activated all the bad memories of my mother’s death. She had emphysema and was hospitalized for the last time on April 10, 1987. After a few days, they hoo…ked her up to a ventilator. She got pneumonia from it. She fought her way back from that in order to be able to hold her newborn daughter, Ariel, who was born May 17.
http://www.youtube.com/watch?v=81oMSxZBRhM
Our Healthcare Update #1
Ralph hurt himself at work in July. He was walking down a hill, carrying a backpack blower, and his knee went out. This is not a good thing to happen in a 50-some year old guy who landscapes for a living. He reported it to his boss.
Ralph went to our family physician, who said, “I don’t take Workmen’s Comp.” So we paid for that one. (Note: I have insurance through my work, but the deductible is $1,500 per family member, which means that we, not the insurance company have to pay for it–did I mention that the coverage costs not quite $12K per year?) The doctor did, however, refer Ralph to a surgeon who does take Workman’s Comp. The verdict? His knee is seriously damaged and will most likely require surgery for torn cartilage. However, the surgeon won’t operate without taking an MRI first, as there is a small chance that it might be something else, that could be handled with a brace and physical therapy. In the meantime, until the MRI is approved by the insurance company, all he gets are prescriptions for painkillers, which we pay for.
After 6 weeks of “I don’t know how to get the forms” from the boss, I called the Workmen’s Comp Board, who got me the phone number for the insurance company, who walked me through their website to the “Print forms” page. Elapsed time: 5 minutes.
It’s a one page form. My husband filled out his half that night (elapsed time: 7 minutes) and took it to his boss. After several days of alternating, “I don’t know how to fill out this form” (Basically something a fourth grader could do.) and “I don’t have time to fill out the form,” bad words came out of my husband’s mouth in the presence of his employer, who then admitted that some friends had told him,”The surest way to destroy your business is to file a Workmen’s Comp claim.”
My husband then checked with the insurer, SAIF, who explained that the surest way to torpedo your business was to not file the form, as the doctor would file one, and if it showed up without an employer report holding its hand, then, buddy, you are in violation of state law and the employee can sue, which seems a lot more likely to wipe out your business than filing a claim on an insurance policy you’ve paid for.
Once he understood that, hubby’s boss found the time, and the reading skills, to fill out the form and send it in.
Then we get to the next level. The insurer says, “Go ahead and get your MRI. If you’re approved, we’ll pay for it later.” Ah, but there’s that tricky little word, “if.” When my husband called to get the MRI scheduled, the receptionist told him, “Yeah, they say that, but if we submit a bill to them, they’ll say, ‘We never approved this! We’re not paying.”
The boss talked to SAIF, and was given “good news,” he told Ralph.”I’ll only have to pay half the cost of the MRI.” Ralph asked who would pay the rest. “You, I guess,” he replied. Ralph explained to him that the whole point of buying insurance was that the insurance company pays for the claim, not the insured.
Ralph’s gone through another week of pain (When the injury first happened he used a vicodin left over from dental work. Didn’t make a dent in his level of discomfort.) The knee is getting worse. He’s up to 3200 mg of ibuprofin a day, and the pain is spreading. They say if the ibuprofin starts to eat away at his stomach lining, he should take Prilosec. The insurance company says it could take two months for approval.
He keeps working for two reasons: 1. His employer doesn’t offer sick pay. (As a small business, he can’t afford it.) 2. It hurts more when he’s sitting down than when he’s standing.
Oh, yeah, reason #3. If SAIF denies coverage, that $1500 for the co-pay is going to have to come from somewhere.
Best health care in the world? Right.
Onward! Over the Edge!
Pat Buchanan has a new book out. You can read about it here. Here’s a quote:
If Hitler wanted the world, why did he not build strategic bombers, instead of two-engine Dorniers and Heinkels that could not even reach Britain from Germany?
Why did he let the British army go at Dunkirk?
Why did he offer the British peace, twice, after Poland fell, and again after France fell?
Why, when Paris fell, did Hitler not demand the French fleet, as the Allies demanded and got the Kaiser’s fleet? Why did he not demand bases in French-controlled Syria to attack Suez? Why did he beg Benito Mussolini not to attack Greece?
Because Hitler wanted to end the war in 1940, almost two years before the trains began to roll to the camps.
Hitler had never wanted war with Poland, but an alliance with Poland such as he had with Francisco Franco’s Spain, Mussolini’s Italy, Miklos Horthy’s Hungary and Father Jozef Tiso’s Slovakia.
Indeed, why would he want war when, by 1939, he was surrounded by allied, friendly or neutral neighbors, save France. And he had written off Alsace, because reconquering Alsace meant war with France, and that meant war with Britain, whose empire he admired and whom he had always sought as an ally.
Um, maybe because he’d really rather have focused all the resources of Germany on getting those trains rolling to the Death Camps without the distraction and expense of fighting his neighbors. However, Buchanan maintains, the war was unnecessary. What’s 6 million Jews, give or take a few? Oh, and the inconvenient detail that he declared war on us, after we declared war on Japan after Pearl Harbor. On the other hand, maybe Hitler wasn’t such a bad guy after all, at least the way Uncle Pat seems to be telling it. Which means that if Obama is like Hitler, well, gee, then according to this icon of the Right, it must mean he’s okay, too. Are you listening, Tea Baggers?
George Will has now decided that the Afghan War is an unwinnable bad idea and we should get out, tout suite. Now he tells us. This is interesting. If Obama stays in, he gets to complain, and if Obama does what the leftward edge of the Dems have been requesting for months, and gets out, he can take credit.
Michelle Bachman asks her loyal minions to “slit their wrists.,” an interesting strategy for stopping health care reform. I hope they all have good insurance coverage.
And don’t live in California, where 22% of all insurance claims are denied.
In other news, Conservatives have come out against children attending school, setting, goals, and studying hard. They call such notions ”indoctrination.” Oh, and according to Terry Jeffries, who debated Joan Walsh on Hardball yesterday, “all children should be taught that abortion is wrong.”
This, it appears, is not indoctrination, despite the fact that it is, literally, the teaching of a religious doctrine. Another bit of evidence supporting my contention that the real Republican philosophy is, “It’s only okay if we do it,” and its colloraries, “Everything we do is okay,” and “Everything they do is wrong. Even if it’s the same thing we’re doing.”
Buy This Stuff Or Diiiiie, Part 2
I ran my last piece past a few of my gardening friends, and we all wondered, “Who would buy this stuff?” Anyone with actual gardening experience would know how to get heirloom seeds for a whole lot cheaper. City people and suburbanites would be generally not interested in buying enough seeds to plant an acre, since they wouldn’t have that much room available. It would have to be someone with over an acre of property, not enough gardening experience to know diddly about the vast quantities produced by that colossal number of seeds or the effort involved, not only in the planting and maintainance, but also the preserving, plus the cost of all those canning jars or that humongous freezer you’d need. (“Nutrient-dense foods for pennies!”) Also someone inexperienced enough to believe that all varieties of everything will grow optimally, as promised, in any climate. Dudes and dudettes, if they did, why would there be….well, I went to Victory Seeds and checked the tomato selections. I counted 52 varieties of red tomatoes before giving up in the middle of the “P”s. I didn’t even attempt to count the pink, purple, green, yellow, white, zebra, paste, small-fruited types, or the Livingstons. Life is too short, and I think my point is made. In addition to the above, you’d need someone who responds positively to the pitch, “Grow enough nutrient-dense food to feed your family and friends forever!” As opposed, say, to Nichols Garden Nursery’s spot ad for Plant a Row for the Hungry. Who could that be?
Ask and you shall receive. Tonight on Rachel Maddow, she interviewed Mike Lux, whose article, “Calhoun Conservatism Raises Its Ugly Head,” can be viewed here. John Calhoun, building upon the thinking of the most conservative of the Founders, James Madison, viewed the individual States as the supreme authority, and opined that the Federal Government had no power to enforce federal law, from the Constitution right on down the line. Read it. It will give you deep background on the whole reactionary phenomena that can be described by terms like Tea Parties, anti-Obama, anti-health care, and secession.
But wait, there’s more. Over at Salon.com, Rich Benjaminwrites about the psychology behind the likes of U.S. Representatives Joe Wilson and Michelle Bachmann. He should know. He’s the author of Searching for Whitopia: An Improbable Journey into the Heart of White America.
As it turns out, as non-white Americans are following the American Dream to the suburbs, white folks, or at least those white folks who are convinced that white folks are, you know, better than others, and aftraid of anyone with a different complexion, are heading for the hills. That they feel safer surrounded by skinheads, however, is a bit worrisome.
There’s the market for the Crisis Garden. Recent exurbs, enthusiastic about their new country lifestyle, clueless regarding horticulture, and living in fear, calling it “common sense.” Caring only for themselves and their own. Determined that America become the never-was fantasy of an America of by and for the white race, or that they live in a little kingdom of their own, separate from the rest of the country. Let me be clear. Not every resident of such places is racist, or interested in anything other than cheap land surrounded by beautiful scenery, but still, there’s a trend.
But maybe there’s a silver lining, here. People who once despised vegetarians, (and largely still do) are now accepting the notion that vegetables are, indeed, “nutrient rich.” By this time next year, they’ll be up to their elbows in green beans, up to their noses in tomatoes, and dealing with the 3,500 heads of lettuce created by planting the 1,750 seeds of each of two varieties of lettuce. (Actually,those would have bolted months ago.) But still, maybe reality will intervene and they will become aware of a/ the stark, raving abundance of nature, b/ the need to share this abundance, as it tends to rot if you try to keep it all for yourself, and c/ just what a blessing a division of labor can be.
Would it be too much to ask that their 1 acre gardening experience teach them the hardness of life for the illegal immigrants who pick the crops they currently buy at the supermarket?
Not holding my breath, but I can dream.
The Annotated What Obama Should Have Said to Congress
John Stossel, now at Fox News, is celebrating his job transition with a bang. You can read his essay, What Obama Should Have Said to Congress, at Reason.com. I’ll save you the bother of clicking the link, and in the spirit of Representative Joe Wilson, offer commentary.
I wish President Obama would have said to Congress: Members of Congress, I ask you to address our fiscal emergency.
In 1964, President Johnson won a landslide victory—quite similar to mine. His election also brought liberals into Congress. The next year, they created the first government-run health care plan: Medicare.
They meant well, but unfortunately, this was the height of fiscal irresponsibility. I know Medicare is popular with the elderly. Of course it is. Everyone likes getting free things. But it is unsustainable.
Retirees believe that their Medicare bills are paid from a “trust fund” that was created with deductions from their paychecks. But this is a politician’s lie.
In truth, our predecessors spent every penny of those contributions immediately. They spent them on wars and pork that helped them get re-elected. The money for current retirees’ health care is taken from today’s workers. [This policy began with Ronald Reagan and was resumed under George W. Bush.]
This Ponzi scheme worked for a while. But then more people had the nerve to live longer. The average life span increased from 71 to 78 years. When Medicare began, there were five workers for every Medicare recipient. Now there are only four. [Dammit, Grandma, why don't you just die off? Preferably in 2010, when the Estate, I mean Death Tax, is 0%.] And by 2030, the Board of Medicare Trustees expects there to be just 2.4. Unless millions of new young workers suddenly arrive from some other planet, [Like Planet Mexico? It already contributes workers, and if those immigrants were legalized, they would have to pay taxes.] there is no way that there will be enough workers to pay the Medicare benefits that we politicians have promised. Medicare’s unfunded liability is $37 trillion—yes, trillion. It’s a scam. We politicians should be ashamed of what we promised our constituents.
We locked up Bernie Madoff for less.
Therefore, today I apologize for defending the absurd health care bills that have emerged from your committees—proposals that would add trillions of dollars of additional debt to an already unsustainable system. [By reducing costs.]
Instead, I propose that we raise the Medicare eligibility age. I propose that wealthy seniors receive Medicare only until they recover as much money as they paid in. [Meddle with Medicare? Has this man ever heard of "town hall meetings?"] After that, you rich people should pay for your own damn health care. [And you damn kids should get off my lawn. This man obviously does not understand the psychology of the rich. I've spent the last two weeks taking annual brokerage fee calls at the bank. Favorite quote, "I have so much money, you people should pay me to have my account there." Yes, actual quote.]
These measures will delay but not prevent Medicare’s bankruptcy. You Democrats and Republicans both better get your heads out of the sand. [I will refrain from making the obvious comment.] There will never be enough tax money to pay for everything that everyone wants. [Unless it involves starting a war or kicking massive government contracts to those who feed the lobbying industry.] If we expect the state to pay for care, a bureaucracy must tell people, at some age, “No, you can’t have that.” You might call it a death panel. [Everyone knows, of course, that Death Panels are better handled by the private sector, specifically the insurance industry.]
There’s a better way. I remind you of my speech to business leaders in March. I said, “America’s free market has been the engine of America’s great progress. … And I believe that our role as lawmakers is not to disparage wealth, but to expand its reach; [If the wealthy have all the money, then everyone will be wealthy, right?] not to stifle the market, but to strengthen its ability to unleash the creativity and innovation that still makes this nation the envy of the world.”
Only the vitality of the private sector—a truly free one, unencumbered by the crippling stranglehold of burdensome government regulation—can lift America out of the unsustainable mess that we liberals [aka Ronald Reagan and George W. Bush, the masters of borrow and spend economics] created. [Yes, just like Phil Gramm's Enron Exception made energy cheaper, and Wall Street deregulation made Wall Street the a safe place for people's retirement money.]
Therefore, I propose complete deregulation of medicine and health insurance. [Who needs a medical degree? Anyone who can afford to get a sign made with "M.D." after their name should be able to go into practice. Okay, maybe they should also have to buy a white coat.] State mandates raise the cost of insurance by forcing people to have coverage many would never buy on their own. The federal government reinforces this crazy system by forbidding competition across state lines. [To take a look at what happened to credit cards when they were deregulated, click here.]
Meanwhile, professional licensing and controls on medical schools keep the supply of medical services limited and prices high. [Like I said, who needs medical school? If your patients die, you'll have no patients. In that way, the Invisible Hand of the Market will force bad doctors out of business. Why not just outsource our medical care to India? Look how well that worked for call centers. Oh, and did I mention that trial lawyers should be outlawed?]
That must end, along with restrictions on Health Savings Accounts. [Yes, I want the right to put unlimited amounts of money into tax sheltered accounts that can be inherited by my children. Inheritance: you can't build a ruling class without it.]
A free medical market would bring lower prices and better services. [Unless, of course, the doctors are paid by the number of procedures they prescribe, as they are now.] The price of insurance would come down with the price of care. [Just like premiums have doubled since 2000 and insurance companies profits have quintupled in that time. You see, left to their own devices, unregulated, (in those respects) like they are now, everything will get cheaper. Just like it's doing now.]
The only way to avoid Medicare’s collapse is to get retired people onto private insurance plans that they pay for themselves. [Was this guy watching TV at all during August?] Since many on fixed incomes would have trouble buying even inexpensive insurance. I propose we sell off the 507 million acres that the federal government owns and give the proceeds to the oldest and most needy. [Oooh, how convenient. Let the oil, mining, timber, and cattle industries pay for the care of the elderly. Averaged out at $2000/acre (and much of the Federal land is fairly wild, remote, and inhospitable) it actually comes to just over $1 trillion. Why didn't we think of that when we needed the bucks to invade Iraq? Duh! I know that 507 million sounds like a nearly infinite number of acres, but how do you pay the tab when they're all sold off?]
Then we must free younger workers from the albatross of Medicare so they can save for whatever medical services they choose, now and in retirement. [Along with freeing them from the albatrosses of good paying jobs, Social Security, Workmen's Comp, and regulation of the financial markets that they invest their hard-earned savings into.]
Yes, my liberal friends, free enterprise is the way. [to Hell.]
Memory is such a short and fleeting thing, and history such a boring subject. Doesn’t anyone remember the Homestead Act, in which the government, yes, the Federal Government, that government, handed out free land for the taking? That those fatty-assed bureaucrats at the Bureau of Indian Affairs negotiated the treaties that freed up that land for settlement, backed up by the long rifles of the tax-payer supported US Cavalry? Does no one remember that it was that Republican icon, Abraham Lincoln, who gave, yes, gave free land to the railroads, who then borrowed against the value of the land to raise the cash to build the tracks using, yes, immigrant labor, largely Chinese and Irish (who weren’t considered actual white people at the time. Read Henry David Thoreau’s comments on “the bog-trotting Irish with webs between their toes” for an eyeful. Does no one remember the electrification of America, the start of the hydropower industry, the Tennesee Valley Authority, the Hoover and Grand Coulee dams, all taxpayer-funded projects? The Interstate Highway System, Eisenhower’s dream, without which Walmart itself would not be possible? The Internet, begun as a project by the military and public universities? That even the conservative wet dream, nuclear power, was a government project?
Does anyone remember that the Constitution mandates that Congress work on behalf of the “common welfare?”
Apparently not. Not Conservatives, not Libertarians, and certainly not John Stossel.
23 Skidoo!
I’ve been away, watching, but not commenting, on the 2009 elections. Events in the 23rd District of New York, in particular, appear to confirm my earlier prediction of Republican schism. So far, there are two sides to the split: the moderate, centrist flavor and the Extra Spicy conservative. I’m going to go out on a limb and predict that the Extra Spicy will itself split into the religious and libertarian factions, most likely just after the 2010 elections. (In a power struggle if they win; in a toxic fume of recrimination if not.)
The results are not all in yet, as I write, but so far Corzine and Deeds have succumbed, Bloomberg has held on in NYC, and Owens leads in New York State. Expect the Republicans to blame the losses on Obama. (Side note: Rep. Joe Wilson, who voted against funding for H1N1 vaccine production, is blaming his wife’s Swine Flu on Guess Who?) I think that Rachel Maddow and Jane Hamsher had an interesting take, however: that Corzine’s loss and Bloomberg’s fairly tight win had something to do with their association with Wall Street wealth. They both outspent their opponents massively and got a loss and a squeaker to show for it. This election is about the electorate turning away from a business-as-usual model that has benefited The Few to the tune of taxpayer billions.
Uncle Pat was on with Chris, claiming that this turn from business as usual would benefit his favorite brand of right wingery, but I have my doubts. I can see where the Right would turn away from the Republican Party, which consistently enlarged the national debt and instituted policies favorable to the wealthy. Unfortunately, the policies favored by the Right will exacerbate the concentration of wealth and pull the support system out from under everyone else. I disagree with his assertion that this is what the American people really want.
Meanwhile, despite Virginia’s amazingly consistent record of voting for a governor of a party opposite the president’s, despite Craig Deeds not particularly good campaign, despite Corzine’s personal unpopularity and so-so record, despite exit polls showing that about 60% of voters didn’t let their feelings for or against Obama affect their vote in the least, with the remainder being split fairly evenly for and against, there will be those only too willing to attribute the state-level losses to the president.
If Hoffman takes the 23rd, expect to hear nothing else for the next year.
This just in: Hoffman has conceded. Gazing into my crystal ball, I see the Extra Spicy crowd coming to the conclusion that if they’d just started backing Hoffman a little earlier, they’d have pulled it off. Chris Matthews was just on with a radio personality I’d never heard of, who announced that “all” Republican leadership must go, although he refused to mention anyone by name. (Mostly he stuck with the buzzwords “Obama” and “Pelosi.”) Maybe I’m alone in this, but the way I see it, the Republican Party had a safe seat in upper New York State until Palin and Armey stuck their big noses in and dragged in some out-of-towner to hand the election to the Democrats. Encouraged by this turn of events, they plan to take it national, gunning for every Republican incumbent to the left of Attilla the Hun. Those whom the gods would destroy, they first make mad.
This should make for an interesting couple of years.
Election Reflection ’09
Everyone is poised to take their own lessons from last night’s election results. On the left, we have Markos Moulitsas of the Daily Kos:
GOP turnout remained the same as last year, but Democratic turnout collapsed. This is a base problem, and this is what Democrats better take from tonight:
- If you abandon Democratic principles in a bid for unnecessary “bipartisanship”, you will lose votes.
- If you water down reform in favor of Blue Dogs and their corporate benefactors, you will lose votes.
- If you forget why you were elected — health care, financial services, energy policy and immigration reform — you will lose votes.
In the middle, we have John F. Harris and Jonathan Martin over at Politico who state:
The off-year elections were, in two big races, an unmistakable rebuke of Democrats, reshuffling Obama’s political circumstances in ways likely to have severe near-term consequences for his policy agenda and larger governing strategy….
Obama now faces a much tougher challenge persuading these mostly moderate Democrats to put themselves further at risk by backing such liberal priorities as expanding government’s role in heath care or limiting greenhouse gases.
I haven’t check the rightward edge yet, but stand by my prediction that they see the results as an endorsement of their views, despite the fact that both gubernatorial candidates presented themselves as moderates and the unabashedly conservative candidate lost.
Update: the ousting of an RNC-approved candidate in favor of a conservative is apparently now the standard for “victory,” even if the conservative loses the actual election. At least according to Dick Armey. Somewhere, Rahm Emmanuel has just fallen down laughing. Hopefully, Rahm will make the case to the Blue Dogs that any step toward getting the progressive base to the polls will work in their favor. Not holding my breath, but not writing off the possibility, either.
For the record, I’m with Kos, but regard Politico’s warning as valid advice, although I think they are being disingenuous by ignoring the fact that Corzine was an unpopular candidate (the White House initially tried to dissuade him from running) and the flabby nature of Creigh Deeds’ campaign. Still,the Blue Dogs will most likely respond by becoming less willing to support a liberal agenda, which means that the Obama Administration will need to respond to the desires of their base in order to increase the pool of voters and make future elections repeats of 2008. Will they see it that way, or take the easy, downhill road of cutting their jib to fit the prevailing winds from established power brokers and cash cow lobbyists? We’ll see. And speaking to the critique from the right, those disaffected with business as usual are as fertile a field for the Democrats as for the Republicans, providing the Dems can resist the siren song of Washington.
New prediction: there will be plenty of primary action in 2010 in both major parties, but the conservatives will be more likely to pick up their marbles and run as spoilers if their primary battles are lost.
I would like to add one comment to my previous post. As a history buff, I’ve noticed that any movement that becomes obsessed with ideological purity–the Jacobins of France, for example, or the SDS of the 60′s–is on the road to self -destruction. Also, apologies to Creigh, not Craig, Deeds for my misspelling.
What If?
After my last post, it occurred to me that perhaps the grown-ups in the Republican Party would put the kibosh on this primary-challenge-from-the-right strategy. Well, a couple of them have made noises in that direction: Newt and Phil Graham, to be precise, but it appears that, to the rightward edge, these guys are as much the enemy as any Dem. It seems pretty obvious, if you check polls and dig deeply into the nature of yesterday’s races and their results, that the right wing shattering of the Republican Party is highly unlikely to win elections for them.
But what if this is deliberate? Stick with me here, it’s loopy. So many of their statements invoke violence: Michelle Bachman’s “whites of their eyes” and “armed and dangerous,” Limbaugh’s comment that a global warming activist who said that global warming is man-made should save the planet by killing himself, that much-photographed tea party sign about being unarmed “this time.” Not to mention, of course, the actual shootings: of Dr. Tiller and at the Holocaust Museum. Their electoral strategy is the political equivalent of lemmings running off a cliff. One has to wonder what Mr. Koch, funder of tea parties and charter busses to DC, has in mind.
After their political strategy reaches it’s predictable conclusion, will he then advise his followers to take up weapons?
Okay, taking off my tinfoil hat now, and hoping that I am totally, totally wrong.
Right Face
Well, the busses have left DC, and it’s safe for Liberals to go out now. I noticed an interesting glich in the videos of Michelle Bachmann’s event yesterday. Never mind that John Boehner got his Constitution and Declaration of Independence mixed up…I noticed the rewriting of the Pledge of Allegiance to read “…one nation, UNDER GOD, [their emphasis] with liberty and justice for all.”
Perhaps you noticed that those ultra-America-lovers removed the phrase, “indivisible.” from the pledge. Interesting.
I also read a piece on Sarah Palin’s run-hard-to-the-Right strategy, wondering if she really “sees things that others can’t,” or is truly, deeply out of touch with reality. I thought about it, and realized that her “strategy” isn’t a strategy, at least not in the sense of being a logically thought-out series of steps. I believe that we’re looking at Palin’s Faith in action. I’m somewhat familiar with the teachings of her church, and her actions make perfect sense within that context.
On the rightward verges of Christian Fundamentalism, you see, you are the boss of God. You Decree what you want, and God provides it. So strategy, in the conventional sense, is not needed. “The Abundance of The Lord Descends upon the Righteous,” as one of my born-again friends used to tell me constantly, so paid invitations to blather in Hong Kong and Iowa are a sign of God’s approval. To the uninitiated, it may seem like crass opportunism, but, according to the theology of such groups, if you’re doing it for Jesus, it’s okay. Whatever it is. Presumably, if it wasn’t God’s will for you to want it, then you wouldn’t, so there you have it. Sanctifed all around.
I read that she’ll be speaking to a small group of anti-abortion activists soon, and has forbidden the Media, cellphones, and all recording devices. It reminded me that her initial support, back in Wasilla, came from the Alaska Independence Party,a secessionist group with ties to Right-wing and racist organizations. Any guesses as to her topic or why it’s so hush-hush?
I suppose she’s tired of the media being mean to her by quoting her words exactly, but (tinfoil hat warning) isn’t the anti-abortion movement the part of the Right with the strongest record of violence in recent days?
Ah, to be a fly on that wall.
Us and Them
Where do the divisions in society really lie?
Garrison Keillor wrote this on Salon.com:
The former Marine officer Matthew Hoh, who resigned his Foreign Service post in Afghanistan because he feels the war is pointless and not worth dying for, deserves all the attention he’s gotten and more. The Obama administration faces hard decisions there, and the man made a good case against deeper American involvement. He says that our presence among the Pashtun people, the rural, religious people, is only aggravating a civil war between them and the urban, secular (and, it seems, fraudulent) government of Kabul, and the role of the Taliban and al-Qaida is not central — the real issues are tribal and cultural.
I don’t think this applies only to Afghanistan. Keillor has a point about the fracture point of civic strife not being christian v muslim or capitalist v commie, but a rural/urban split, with the rural areas tending to be more conservative and attached to the most traditional forms of whatever religion is indigenous to the area. Look not just at the Middle East or the US culture wars but, if you will, to the Amazon rainforest, where shamanic hunter gatherer cultures are confronted by agriculture, cattle raising, and resource extraction companies.
Seen through that lens, a surprising number of hot button issues take a different cast.
- Gun rights-if you live in an area where hunting for food is an option, and where defending your flock against predators is a necessity, of course it makes sense to own a gun. If you live in an area where hunting for food would involve the consumption of rats and pidgeons, not so much.
- Abortion-if feeding another child means adding another row to the garden or shooting a moose, v being plunged into a life of desperation, that does make a difference.
- The environment-This one gets interesting. On the one hand, you have the indigenous peoples, who generally prefer their land to be left as God made it, and as they have been accustomed to living on it for centuries. At the other extreme, the city dwellers, who, living in places where nature has been pretty well beat back and is frequently toxic, increasingly tend to lean toward preservation and restoration. In the middle, people who tend to live in rural areas tend to make their living from either agriculture, animal husbandry, or resource extraction, and often agree with a fellow I met in Brunswick, Ga, home to a paper mill, a turpentine plant, and a shrimp cannery, “Smells like bread and butter to me.”
Population density changes everything.
Fifteen Reasons for the Economic Meltdown, + 1
The other fifteen reasons are here.
So on to the + 1.
You could call it supply and demand. You could call it over-concentration of wealth. I’m thinking that it occupies the intersection of the two. Here’s why:
The more wealth one accumulates, the more one expects to live off income generated by it. Sometimes this is what Stephen Gaskin referred to when he said, “Money is fossilized laziness,” back toward the end of the Sixties. Sometimes this is institutionalized, as when workers put money in pension funds against the day when they will no longer be able to put in that hard day’s work. When wealth accumulates past a certain point (and I’d love to know exactly what that point is. Any economists out there?) the supply of money looking to be invested exceeds the number of sound investments.
That’s when the fun begins.
According to Supply Side theory, the number of possible investments is theoretically infinite, since the human imagination is theoretically infinite. True, but the number of investments that will actually succeed and turn a profit is limited by any number of things from the usefulness or desirableness of the product, the cost of the resources and labor needed to produce it, and the available cash in the potential customers’ pockets. You can extend the game for a while by such tactics as lowering your labor costs by sending the jobs to Shanghai, or by making credit really, really cheap so people will buy things they can’t really afford, but eventually these two trends will intersect in a bad way. Jobs, and their related paychecks, go away and payments come due.
In the meantime, however, hay is to be made from investing all that accumulated cash. First you invest in Grade A++ investments that actually are Grade A++ investments. When the supply of them runs out, there’s still that enormous demand, and much of the demand is generated by pension funds, which are prohibited from investing in lower grade securities. What’s a good investment banker to do? You can’t turn clients away.
So the pressure is on, and it is applied throughout the system. Ratings agencies are under the gun to produce what the market demands. Mortgage companies are under the gun to keep churning up new customers, and the pressure comes from the boardroom and percolates right down to the guy in the storefront. The entire economy is based upon the notion of never-ending growth, sort of like cancer, and with as fatal consequences.
Enter the speculators, whether of the “Rich Dad/Poor Dad” variety, day traders, or commodities fans. Once again, a bidding war results among people who never intend to live in that house, give a rat’s ass whether tat company will be in business a year from now, or actually eat all those pork bellies. The system becomes distorted by their activity, driving up costs for the rest of us.
Now again, according to the Right Wing economic theory still clung to by some, this is all okay, as the market will regulate itself. Well yes, it does, in the sense that if you make a stupid investment, you’ll lose your money and won’t have it to invest any more. Which leaves the guy who lied to you and cheated you that much richer, unless he got conned by someone else.
If enough people buy houses, the supply of renters dries up, leaving the real estate speculator holding a very big bag. If the market turns, the day trader’s gains go up in smoke. If the price of bacon, gasoline, sugar, you name it, is too high, sales go down, and prices tumble.
The whole rules-are-for-sissies notion that the economy operated under during the Zeros (2000-2009) is designed to work for the best interests of criminals.
Justifiable Homicide
Emily Bazelon, writing in Slate, discussed the Tiller murder case, specifically the judge’s ruling that
Roeder will be allowed to argue that he was justified in shooting Tiller because he was trying to “protect the unborn.”
Interesting logic, which I suspect the Right will applaud. By the same logic, however, someone could then shoot Roeder, in order to “save the lives of doctors.” For that matter, the Underpants bomber could claim that he was trying to “save the lives of Muslims” by providing a deterrent to US Mideast policy.
That’s one slippery slope, Your Honor, taking the concept of self-defense and applying it to premeditated murder.
Tea Partypoopers
Well, the upcoming Tea Party Convention in Nashville has hit a few speedbumps. There seems to be a conflict between people who want to make money without the government collecting taxes on it and people who want to make money off of people who want to make money without the government collecting taxes on it.
Still, you have to admit that $350 a plate for dinner is kind of spendy, especially for a crowd that bills itself as working class. Michelle Bachmann has bailed, Marsha Blackburn has bailed, but what about Sarah Palin?
This is a tough one. She’s demonstrated that she likes to make money, and there’s $115K on the line here. She’s also demonstrated that when the going get hot, she wants to stay in her kitchen in Wasilla. What to do?
Fortunately, there’s an excape clause in her contract: In case of illness, she can send a substitute.
Perfect! A win-win all around, especially now that having done the natural thing of supporting the re-election bid of the guy who dragged her from relative obscurity to the national spotlight has transformed her from Right-wing darling to Tea Party bete noir. She can still get her fat paycheck without having to speak to a hostile crowd.
Who do you think she’ll send? I’m hoping it’s not Bristol. True, she’d be a logical choice. It would keep the speaking fee in the family. Bristol’s starting a public-speaking career and could use the publicity boost. She’d speak on a topic near and dear to Conservative hearts: not having sex outside of marriage, although how many unwed teens could afford $350 for surf and turf is questionable. She’s young, and pretty, and surely their delight at her choice to bear a child out of wedlock rather than abort would outweigh their feelings toward her mother. I mean, it’s not as though anyone would consider asking her to tell her mother anything on their behalf, would they?
Still, there’s that saving yourself by throwing your child to the lions thing.
I fully expect La Palin to ditch at the last minute. It will be interesting to see who she sends in her place.
Dad Blamed Gummint
I was working in the call center today, and a fellow called in to take some money out of his IRA. “Would you like the check overnighted?” I asked.
“Sure,” he said.
“There’s a $15 UPS fee, and someone has to be home to sign for it.”
“That damn Obama! He just keeps taking more of my money!”
“Sir, that money goes to the United Parcel Service. That’s what they charge to deliver a package.”
After he hung up (of course) I wished I’d said, “No sir, that’s the capitalist system taking your money,” just to see how he’d react.
Then I got home, turned on the news, and found out that, now that Goldman Sachs has been busted for massive, intentional securities fraud involving casino-style betting on subprime mortgages derivative trading, the Republicans all signed in blood their intention to filibuster Wall Street Reform. (By casino-style betting, I mean in the sense that the odds are stacked in the house’s favor.)
Now, according to the Tea Party, government is the problem and the solution is to get rid of as many regulations as possible. Hmmmm…. So exactly who will be strong enough to keep the bazillion dollar firms of Wall Street from playing Monopoly with our houses, our savings, and our retirement accounts?
It’s becoming obvious, what with the latest Luntz talking points, the Tea Party strategy memo leaked from the PR firm that consulted in its creation, Rachel Maddow’s excellent investigative work on Koch Industries generous support of the lobbying and PR firms providing infrastructure and organizational help to the TP, and Republican leaders’ recent pilgrimage to Wall Street to assure the current crop of malefactors of great wealth that they’ve got their backs, that the grassy-rooty thing known as the Tea Party Movement is just the latest iteration of that recurring strategy by which the smarty-greedy 1% hornswoggle the True Believers into attacking the Middle Class. In the name, of course, of attacking the Lower Class.
Why would the conservative rank and file let themselves be used in this manner, seeing as many or most of them would qualify as Middle Class themselves? Or Working Class. Or Dependent upon Government Benefits. Just asking.
So looping back to the question I asked earlier, “exactly who will be strong enough to keep the bazillion dollar firms of Wall Street from playing Monopoly with our houses, our savings, and our retirement accounts?” I’d like to propose that We the People are the ones to do it. We can either do it by refusing to entrust our money to the large banks and brokerage firms or by voting in people who take their responsibilities to act on behalf of their constituents, as opposed to their campaign donors, to set up and enforce laws that prohibit criminally reckless behavior or better yet some combination of both.
It’s a delightful image, formerly giant financial institutions chasing after us, begging us to come back, promising honest dealing and transparency to induce us to bring back our mason jars stuffed with cash. In reality, they’d probably just offer us free toasters or a sweet teaser rate and we’d come back like lemmings. After all, Roosevelt’s creation of the FDIC revived the banking system after the series of bank crashes that ushered in the Great Depression, not any voluntary behavior on the part of bankers. Yeah, I’ll review my banking options, but I’ll also root for John Law and the threat of Club Fed to keep the big boys in line.
Most people choose their banks based upon convenience. Yes, it’s true that there all those telephone and internet service options, but for the most part, people choose banks that have ATMs near their home or job; banks where they can trot down the street and ask Doris for the latest CD rates. And there’s a legitimate role for large institutions. A pension fund holding billions of dollars of OPM (other people’s money) needs to deal with someone equipped to invest those funds quickly, efficiently, and honestly. Trotting down to the local credit union and dropping it into a jumbo CD would overwhelm the credit union. Wall Street has the quick and efficient part down pat. It’s the honestly part that needs work.
While it’s popular on the Right to blame the whole problem on Fannie Mae and Freddie Mac, or poor people trying to buy homes, they were merely a part of the conveyor belt of bad debt that transformed America’s credit rating into a pile of shredded paper. The ability to sell mortgages to investors gave lenders an incentive to relax lending standards. After all, once the loans left their books, it didn’t matter to them whether they got repaid. This problem was worst in the independent non-bank lenders who were free of banking regs and had a business model in which their income stream relied upon a never-ending flow of new mortgages, rather than the repayment schedule. Eventually the pool of qualified borrowers was drained and those firms’ existence came to rely on generating liar’s loans. On the other end, the selling of these bundled securities was driven by the increasing concentration of wealth and the need to invest it. Part of this was driven by the inevitable transformation of those Boom Babies into gray-headed retirees with retirement accounts. Another part arose from the change in American business that saw an advantage in sending as many jobs as possible overseas. Increased profits came back home, but they went to a comparativelysmall pool of shareholders while the former workforce was left to shift for itself. This concentration of wealth created more demand for investible securities, and that demand drove the creation of mortgage-based derivatives.
Derivatives are complicated, and that’s what has enabled the institutions trading them to play fast and loose with their fiduciary responsibilities. That, combined with a culture that unabashedly worships Mammon and glorifies the Big Swinging Dicks (the Salomon Brothers term, from Michael Lewis book Liars’ Poker) who bring the most profit into the firm. But now we’re learning the lingo. Derivatives are bets, bets that the value of something will go either up (long) or down (short). When you are “long” in an investment, you own it, and are hoping that it will increase in value, or in the case of loan-based investment, that the homeowners will continue to make their payments. When you are “short,” also called “hedging,” as in “hedging your bets,” you’re betting against that proposition. Essentially you’ve taken out an insurance policy on the investment ‘s eventual cratering. You have no stake in the underlying investment, or the people living under those roofs. It’s like taking out an insurance policy on someone else’s house. Moreover, for the most savvy players of the game, it’s like inspecting all the houses in the neighborhood to find those with faulty wiring, piles of greasy rags, and people who smoke in bed, preferably in a flood or earthquake zone, and then taking out insurance policies on their homes. Hedgers look for mortgage-backed securities with a high percentage of no-doc “liar’s loans” and adjustable rate mortgages, where the homeowners are pretty much guaranteed to default when the teaser rate expires.
Why would anyone take the dumb end of that trade? Because selling the option brings in cash flow, millions in cash flow, in addition to the income from the mortgage interest. Presumably, you can always sell it to a sucker when it starts to go south, declare bankrupcy, or hold out your tin cup to Uncle Sam if you lose the bet. While that system enables a tiny group of math geniuses to accrue massive profits, it’s nothing but trouble for the rest of us.
That’s what the Dad Blamed Gummint is for…to create a mechanism to enable the many to unite and stand up to the abuses of the powerful, a radical idea in the Eighteenth Century. The powerful know that, and that’s why they support the Tea Party, which has as its primary goal the weakening of the Federal government. So much for returning to the ideals of the Founders.
Universal Health Care, Republican Style
Sue Lowden, one of the Republicans jousting for the privilege of running against Senator Harry Reid this November, has suggested that a good strategy for bringing down health care costs would be to barter with your doctor. She specifically suggested payment in chickens or housepainting, like ”in the old days.”
In return, should we expect the healthcare our chicken-raising forebears got? As in, “You have cancer. Here’s a bottle of laudanum [tincture of opium]. Take a little nip when the pain gets too bad and go home and plan your funeral.”
My husband just had surgery for two herniated discs. We’ve been told that the insurance company will pony up something like $58K. How many chickens is that?
Still, I can see some other uses for this tactic, say, campaign contributions. Twenty-some years ago a friend of mine got a fundraising letter from the Republican Party, complete with postage-paid return envelope. Since he was not particularly fond of the Republican agenda, he wrapped the envelope around a brick and mailed it. Think of the possibilities.
So my only quandary is: Should I send her my campaign contribution fried, grilled, extra-crispy, raw, or live?
The American Way
Mom and Pop came over on the boat. They worked hard at whatever jobs they could find. They lived frugally. Maybe they never learned much English beyond Hello. Goodbye. Please. Thank you, and Police! Their children, Gen2, were most likely bilngual. They, too, worked hard, got more education than Mom and Pop, and did better. If Pop worked as a janitor, maybe Son started a janitorial service. Gen 3 speaks English with an American accent. Possibly went to college, and possibly never learned much of Mom and Pop’s native language beyond Hello. Goodbye. Please. Thank you and the names of the special dishes that Mom serves on holidays.
Oversimplified, maybe, but that’s how it worked in my family. And unless you are a pure-blooded member of a Native American tribe, that’s how it worked in your family, too. (With the exception of those whose ancestors were English-speaking, who, like my Irish forebears, were discriminated against for their accents.)
But here’s the thing: we still need janitors, orderlies, maids, agricultural laborers. Those who object to illegal immigation probably don’t want to push lawnmowers for a living, nor do they favor sending their kids out to pick tomatoes and follow the harvest as migrant farmworkers. Yet there’s pressure in our political system to delay, indefinitely if possible, a serious reform of our current immgration system, which is overwhelmed by the number of people wanting to come here. Why is this?
Many of the nations of Latin America are facing serious political and economic problems. For the most part, small elites control the overwhelming majority of the assets. Poverty, and the resulting desperation, create horrendous living conditions, conditions so bad that coming to the US and living 6 to a room looks good by comparison. I can’t argue. My father’s people came over to escape the Irish potato famine and my mother’s people come from Germany to escape violence between Catholics and Protestants.
That’s the Supply side. The Demand side comes from employers who boost their profits (aka “remaining competitive”) by hiring illegal aliens. No muss, no fuss, no need to pay minimum wage. Benefits? Who needs Benefits? While honking and quacking over how illegal aliens should not be included in any national health care plan, they are perfectly willing to use emergency rooms to provide free healthcare for their workers. Result? Higher costs for everyone who pays for healthcare, whether on their own dime or through an insurance plan. Sweet deal.
Now the Republicans, while alleging that the Democrats caused Arizona’s ham-handed law by delaying immigration reform, are adamant that now is not the time to bring up the subject. They’re in a real bind. Their constituencies consist, on one side, of those most attached to the idea of a white, English speaking America, who feel that immigrants are competing for their jobs (and want to see their food prices stay low) and on the other those who profit from the cheap labor provided by the existing state of affairs. The Republican position pretty much cuts them off from any possibility of gaining Hispanic votes. Right now they’re praying very hard to get immigration off the front pages until after November. Out of sight, out of mind.
This is a pattern that goes back to the birth of our nation. Right now we have policies in place that will guarantee a permanent underclass of undocumented workers. When the Constitution was being debated, each slave, while being denied a vote, counted as 3/5 of a man for purposes of assigning representation in Congress. That meant that each Southern vote was worth approximately 1 3/5 Northern vote. The Conservative custom of wanting it both ways dies hard.
Funder, Blunder, & Plunder
It’s said that the three generations of business are “Funder,” the generation that starts and builds the business, “Blunder” the second generation, that lacks Daddy’s innovative talents and seeks to maintain the business without responding to change in creative ways, and “Plunder,” the generation that runs the business into the ground, liquidates the assets, and lives high on the hog until the money runs out.
I think this concept applies to politics, as well. I was watching TV and saw one of Rachel Maddow’s spots in front of Hoover Dam. She spoke about how our grandparents built such projects with the intention of building something lasting and beneficial for us, their descendents: They were the Funders. Conservatives would beg to differ, but I see St. Ronald of Reagan and his political cohort as the Blunder generation, spending trillions, tripling the national debt in pursuit of weapons of mass destruction, while beggaring our infrastructure and furthering the notion that there is no such thing as the common good.
We’re now afflicted by the Plunder generation—sacking our cities and states, stealing our roads, our parks, liquidating the businesses founded by our grandfathers and sending the pieces to China, Burma, the Marianas, anywhere desperate people can be treated worse than livestock to increase profit. Like Ayn Rand’s villains, they create nothing, stifle innovation, and seek to appropriate the institutions built by generations of workers and taxpayers to their own benefit, the leeches. They’ve pretty much run out of private businesses to gut, so now they’ve turned their gimlet eyes to public assets.
Need examples? There’s the Indiana Turnpike, sold to a foreign consortium; Detroit’s public schools, being parceled out to private companies running charter schools; that lakeside park in Michigan on a fast track to becoming a ritzy golf course; Chicago’s parking meters, a 75-year lease sold to a private enterprise for enough money to cover one year’s budget shortfall. Chicago’s downtown parking rates have tripled since then and there’s nothing anyone can do about it.
Sure, Conservatives say, let’s dismantle the work of our grandfathers. Social Security? Nanny statism. Let Goldman Sachs have at your retirement funds. After all, they did such a brilliant job with your 401K. Highway maintenance? Pork. We don’t need no stinking maintenance. Roads and bridges, they seem to believe, will fix themselves. (Actually, there’s a strategy here. Let them run down through lack of routine maintenance, then, when they become “too expensive for the state to fix,” they can be sold at deep discount to private owners who will do the needed repairs and erect tollbooths.) Healthcare? Let them eat aspirin. Sometimes I wonder—how many people have become addicted to painkillers, buying them on the black market, because they can’t afford to see a doctor, get physical therapy, or take time off work to heal?
I’m not an Ayn Rand fan, but she did have one gem among her marbles: the notion that established players will act to stifle any innovation that threatens their interests. Miss Rand came from Russia, where bureaucrats—even prior to the Communist Revolution—ran the place, so it’s not surprising that she chose bureaucrats as her progress-stopping villains. Here in America, business runs the place. Is anyone surprised that here, in the Age of Oil, where the entire economy runs on oil, is “addicted to oil,” in the words of a former president, that the primary forces working to hold back change and stifle innovation (other than the transfer of public resources into private hands) all seem to be related to the oil industry?
Ironically, the Koch brothers, those Libertarian icons and sugar daddies, are actively filling the role of Rand’s villainous progress-stopping bureaucrats in this drama. It’s an odd twist to their family history. Their father invented a new process for refining oil. He was driven out of Texas by oil barons invested in older, less efficient refinery technology. He went to Russia, where the Soviet bureaucrats (Soviet bureaucrats!) welcomed his expertise and technical innovation, but he became disillusioned when he learned of Stalin’s gulags. Returning to America, he established his business, became a founder of the John Birch Society, and passed his anti-Communist meme to his sons.
But the brothers are, after all, the second business generation, seeking to blindly maintain the edifice that Daddy built without the innovation needed to respond to a changing reality, so there’s a certain logic to their opposition to all things Progressive, i.e. any transition from an oil-based economy. Acolytes of the Gospel of Selfishness, they are defending their economic interests.
Life is sometimes stranger than fiction.
Fooling the People
The partisan health care debate has devolved into a battle of sound bites, which can be basically summed up as, “You’re trying to kill Medicare!”
“No, you’re trying to kill Medicare!”
“Nuh-uh!”
“Yuh-huh!”
The root of the problem is, of course, that medical care is pricey, and that the older you get, the more of it you tend to need. So let’s look at some basics.
An ounce of prevention is worth a pound of cure.
Ben Franklin said that, I think, so even the Tea Party should be able to agree with it. Prevention breaks down into three components:
Healthy habits: good diet and dental hygiene, moderate eating and alcohol consumption, not using tobacco or other addictive substances, regular exercise. This is the “personal responsibility” component. There are, of course, powerful economic interests lined up against much of this. “Fourth meal,” anyone?
Preventive medical care: regular checkups and dental cleanings. Catching that high cholesterol before it shows up in the Emergency Room clutching its chest. Finding that little lump before one boob is twice the size of the other. Get folks in where the docs can catch things before they involve major surgery. But there’s a personal responsibility issue here, too. You have to make the appointment and show up. And be able to pay for it. This is where Universal Health Care comes in. Yes, I said Universal Health Care, which is what Medicare is for people over 65. More on that later.
Clean air and water: This, I think, is why much of the anti-“Obamacare” funding comes from folks like the Koch Brothers. They’re taking the short-sighted, but standard, corporate view that their own profits trump everything. Internalizing profit and externalizing risk are, after all, standard corporate operating practice. Save money by not having to install smokestack scrubbers? Sure, I’ll donate to that cause! Increase in lung cancer and asthma rates? Not my problem. You people are after my money. Moving the responsibility for providing medical insurance from corporations to taxpayers may be a carrot to offset the stick of environmental responsibility, but corporations can always save money by reducing employee health benefits without the bother of cleaning up after themselves.
You get what you pay for.
I don’t think Ben Franklin said that, but he probably wouldn’t argue against it, either. Want to pay your doctor in chickens? Don’t be surprised, if, when he gives you that cancer diagnosis, the treatment consists of a bottle of Laudanum—tincture of opium—and he tells you to take a little nip when the pain gets too bad and go home and plan your funeral. You know, just like the good old days. [Watch John Wayne's last film, The Shootist for a primer.] That state of the art stuff involves a lot of expensive equipment and highly-trained personnel with student loans to pay off.
Strength in numbers
Why is health insurance more affordable for employees of large corporations than small, and more affordable for employee plans than for individual coverage? Because the larger the group, the more the risk is spread. A group of 330 million people is going to have lower rates than any smaller group.
Of course, the Right presents this as “healthy people paying for sick people’s treatment,” which ignores the simple fact that anyone who participates in any insurance plan is, in real terms, paying the medical bills of their less-healthy fellow plan members. The deal is that they’ll pay for yours when it’s your turn. Pretty much everyone has healthy and sick times in their lives. No matter how well you eat, how much you exercise, how diligently you avoid carcinogens, there’s always that hit and run driver out there somewhere, that patch of ice in the parking lot, that loose step on the stairs. A neighbor of mine, a construction worker who climbed ladders every day of his life, became paralyzed from the waist down when he stepped off the bottom rung of a ladder helping a neighbor take a dead branch off a tree. Shit happens.
The Right, on this issue, finds itself arguing simultaneously that we should all get out of paying for medical insurance if we choose, and eat bacon double cheeseburgers for breakfast, lunch, and dinner while chain smoking, and that anything else is some sort of government tyranny over our personal lives. (Our lady parts are, however, a legitimate target of government control, but I digress.)
According to Conservatives, private industry does everything better than the government at all times. Under our current medical system, thanks to the dreaded Obamacare, 85% of your premiums must be spent on actual medical care, leaving only 15% for overhead and profit. (This is a reduction from previous insurance company admin costs and profit margins.) Medicare spends 97% of their funding on medical care, and only 3% on admin, and contrary to what the Right keeps insisting, without sending seniors to government clinics or putting them on waiting lists.
Let me reiterate: Running your health care money through private insurance companies raises medical costs. Want to save 12% on national healthcare spending? Let Uncle Sam do it. Our Medicare system is held in such high regard internationally that when South Korea looked to set up universal health care for its citizens, it compared national healthcare systems worldwide and chose Medicare as their model. Yes, South Korea, the anti-communist one.
Why medical bills are so high.
As noted earlier, high-tech medical care is inherently pricey, but there’s more to the equation. Once upon a time, my daughter needed a standard round of blood work. We weren’t insured at the time, so I told the receptionist at the lab that I’d pay the bill myself. She gave me an odd look and asked me to take a seat. Fifteen minutes later she handed me a bill for over $650, and asked me to pay up front. Fortunately, my daughter didn’t really feel like getting stuck with a needle that day, and even more fortunately, we were able to figure out what caused her problem without the blood work. I remarried a few months later, and my new husband needed the same round of blood work, which was covered by his company’s plan. It cost about $100, of which he paid $33.93. Yes, the lab was thrilled to get only $67 from the insurance company and another $33 from us and further, they were willing to let him pay a month or so after the tests were done. What gives?
Simple. Medical providers have been burned over and over by deadbeat patients. It’s a trap, because while there are deadbeats who are legitimately able to pay their bills, but don’t, many more fail to pay because they don’t have the means to do so. In addition, since many doctors won’t see uninsured patients without payment in advance, those individuals are more likely to show up at the ER, where it costs a couple of Benjamins just to walk in the door for even minor maladies, or they defer treatment until the ER is the only appropriate place for them to go. What might have been handled with a ten-day antibiotic prescription or outpatient surgery turns into a week in Intensive Care or major surgery that costs hundreds or thousands of times as much. Given that approximately 1/3 of them won’t pay, those costs get tacked on to everyone else’s bills. Insurance companies bypass this, since they have the size needed to negotiate, (the same principle as collective bargaining, BTW) and because medical providers know they’re generally good for it and let them pay the actual cost. It’s the uninsured—specifically those who own property that could have liens placed on it—who end up paying other people’s bills.
Perhaps, you are thinking, we should change the law that says that everyone who shows up at the ER must be treated. Think about the possibility that your child might be hit by a drunk driver or your father might show up in cardiac arrest, only to have treatment delayed while their insurance status is verified. Still so sure? Universal healthcare, aka Medicare for all, would stop this part of the medical cost spiral.
I just listened to Paul Ryan discuss his plan on TV. He explained that Medicare would be replaced by something very similar to the current Medicare Advantage option, in which, rather than medical providers billing the government directly for their services, government funding (approximately $6,000 per senior per year) would be given directly to insurance companies, with seniors paying the remainder of the premiums themselves. As discussed above, this would automatically result in a 12% reduction of the amount of money available for your medical care. (Watch your premiums rise, Granny!) Increases in Ryan’s voucher or “premium support,” as he now calls it, are indexed to general inflation, which is lower than the rise in medical costs. Year after year, an increasing portion of premiums would be paid by retirees, whose incomes tend to be fixed. The Democratic plan is to keep the current Medicare system and get rid of Medicare Advantage, since that is the most wasteful and least efficient part of Medicare. Meanwhile, Republicans claimed to oppose last year’s health care reform bill, in part, due to the removal of Medicare Advantage, painting it as a defunding of Medicare that would reduce seniors’ benefits.
I can’t be too clear about the effect of Paul Ryan’s plan. It would scrap the most cost-effective parts of Medicare and expand the most expensive, all in the name of saving money.
You can fool all of the people some of the time, some of the people all of the time, but you can’t fool all of the people all of the time.
Some Republican said that.
How to End the Debt Ceiling Gridlock, In 4 Easy Steps
1. Stop all Congressional and Senatorial paychecks until the ceiling is lifted.
If that doesn’t speed things up,
2. Furlough all Congressional and Senatorial aides.
If that doesn’t work:
3. Furlough all Capitol maintenence workers.
If that doesn’t work:
4. Furlough all Capitol security personel.
Step 5, if needed, would be to cancel all military pay.
The Morbidly Obese Economy
Bear with me. This will make sense.
Fat is necessary in the human body. It produces hormones, like estrogen, and serves as a reserve for lean times, when food is scarce. However, you can have too much of a good thing. Fat as twenty percent of body weight is considered healthy. Over thirty percent is considered obese. Over fifty percent is known as “morbid obesity.” That’s Morbid, as in Preoccupied with Death.
How does fat get there? The body’s main fuel is carbohydrate, a molecule made from carbon and water (carbo + hydrate) When you eat, the digestive process breaks carbohydrates in your food into a simple carbohydrate called glucose, or blood sugar. Whatever glucose isn’t used is converted to a more complex carbohydrate called glycogen and stored in the liver. This gets converted back to glucose and burned when you run low temporarily, like when you miss lunch. When the liver is saturated with glycogen, additional carbohydrate is converted to fat and stored all over the body.
Now here’s why it’s so hard to lose weight: In a word, ghrellin. This hormone triggers feelings of hunger and is produced by your body when blood fat levels rise. In ages past, a rise in blood fat level most frequently occurred during famine, when people literally “lived off their fat.” As fat is consumed, it moves from storage through the blood stream to the liver, where it’s converted back to glucose, temporarily raising blood fat, or “lipid” levels. Your body can’t tell the difference between a diet and a famine. When you diet, you feel hungry.
But your body can also be fooled in another way. If you eat a diet high in fat, the rise in blood fat levels from your food will trigger the production of ghrellin, which triggers hunger pangs. That’s why you feel hungry sooner after a fast food meal than a more balanced meal. It’s almost as though those fat cells will do anything to preserve themselves. In a healthy body, with a modest amount of fat, this is a good thing. It keeps your weight stable, but when the fat cells take over, you’ve got a real problem.
In case you haven’t noticed the website this blog links to, nationalgovernment.biz, is a political satire site. Well, sorry to disappoint, if you’re reading this to lose weight. I’m switching gears here because I think the metaphor of morbid obesity applies to our economy. I think you’re smart enough to figure out how to lose weight from the information above. Hint: eat lower-fat food, fill up with water or fibrous foods like fruits and veggies when you feel hungry, and move around more. But keep reading, because stress, as in “I need a job” or “I can’t pay my bills” is a major cause of overeating, too, and that’s what I’m getting to next.
Bear with me. This will make sense.
Let’s compare the economy to the human body. Just how does that work? Let’s start with money.
M1 is what economists call cash plus Direct Demand Accounts (DDA, or “checking accounts”). This is the money we use on a day-to-day basis and would correspond to glucose, the form of carbohydrate that fuels the body.
M2, savings accounts, CDs, and suchlike, is equivalent to glycogen, a little harder to get to, but still available in a pinch.
For simplicity’s sake, I’m going to lump all less liquid forms of wealth into one category, M3, although economists have various numbers to describe them. For purposes of this essay, I’m going to define all of the more difficult-to-access forms of wealth—stocks & bonds, real estate, jewelry, collectibles, precious metals—things that take some time and effort to turn into cash, as fat.
There’s a second way to use this metaphor, as well. Look at the distribution of wealth in a society. If you think about it, what I have arbitrarily classified as M3 above tends to be associated with wealthier folks. It’s not that poor people don’t have gold chains or middle-class people don’t own houses, but if you’re looking at a $1 million dollar house vs a $50,000 house, or someone owning one house vs many, I’m betting it’s the rich guy who comes out on the pricey end of that comparison. What happens when a majority of the wealth in a society is concentrated in few hands? I think we are in the process of finding out. Right now 20% of all income goes to just 1% of Americans, and 50% of the stock market is owned by that same 1%.
Let’s say that the heart is industry, the great engine that pumps goods and services through the economy. What happens when there’s too much fat in the body? Plaque—fatty deposits—in the arteries feeding the heart choke off blood flow to the muscle cells (factory workers) that do the work of pumping. Underfed, those cells begin to atrophy. Perhaps working families borrow to make up for a diminished cash flow, or a cash flow that remains static in the face of rising prices. And don’t get me started on what happens when we ship jobs overseas. For an economic comparison, try this: Unions invest their pension funds in the Wall Street. The stock market crashes, due to irresponsible behavior on the part of bond traders, who make money on their trades regardless of whether their clients gain or lose. Pension funds tank, and the resulting shortfall in pension funds is then blamed on “greedy union members,” who are then asked to take pay cuts, pension cuts, and give up their right to collective bargaining. Somehow this looks a lot like those fatty plaque deposits blocking blood flow to the heart muscle. In health terms, this is called heart failure. I’m not quite sure what the economic term is, [Recession? Depression?] but I think we’re seeing the symptoms now.
Obesity has other effects, such as diabetes, a condition in which the body no longer has the ability to properly regulate its blood sugar level. In the economy, this could correlate to a lack of financial regulation, and the resulting high blood sugar levels might correlate to excess credit. Bubble of 2008, anyone?
But the clearest correspondence between the body and the economy is symbolized by those pesky ghrellins. No matter how much the rich have, they seem to always want more.
There’s problem here in this country. It’s not unlike the one faced at the turn of the previous century, when robber barons ruled the land, and a progressive income tax was instituted, not only to fund the Federal Government, but to put the brakes on the fat cells’ takeover of the body politic. The Republican Party would like to reverse this.
Do you really think this is the way to economic health? I don’t think it is, any more than morbid obesity is the way to physical health.
I’m not alone. Click here.
From the Mouths of Babes
Have you ever met someone whose favorite topic is how smart they are?
What is your estimate of their intelligence?
Exactly. If they have to tell you, they’re not. If they were, they wouldn’t have to tell you. You’d figure it out from their actions.
So what does Michelle Bachman say about herself? She’s serious. She’s a serious candidate. She says it over and over. And over. This is not to say that she, like the people who brag about their intelligence, doesn’t absolutely believe herself. It’s just that it’s not proof of seriousness. In fact, it’s proof of the depths of her delusion.
Likewise for any politician who calls him/herself fiscally conservative and refuses to raise taxes.
Who the People?
Michelle Bachman officially announced her presidential campaign a few days ago. She spoke of “We the People” getting rid of burdensome government regulations.
Her memory is so short. In 1977, my husband watched from the deck of the USS L.Y. Spear as flames swept through the Portsmouth Naval Shipyard, damaging his ship and the nearby USS Iwo Jima. The Naval Yard didn’t catch fire, the river did, just like the Cuyahoga River did in Cleveland in 1969. Back then, We the People petitioned, hell, nagged, our elected representatives until they passed the Clean Water Act and established the Environmental Protection Agency.
How things have changed. “People” just aren’t like they used to be. Now the richest and most powerful “persons” are corporations. If you prick them, as Shakespeare put it, they do not bleed. These are the “People” whose interests Bachman represents.
It remains to be seen how many voters will go to the polls believing that they are the “people” whose rights Bachman wants to expand.
Stakeholders
I read Harold Meyerson’s excellent article in the Washington Post today. He outlined the causes for the bankruptcy of the LA Dodgers and the decline of the LA Times. I’ll give a quick quote, if you don’t have time to click through and read it:
The stories of the Dodgers and the Times can be read as parables of a particularly vicious form of capitalism that America has come to know too well the past few decades: a new owner takes over a venerable firm and extracts what he can for himself, decimating the company and damaging the community in the process.
This brings up for me the concept of the “Stakeholder,” an individual or group who has a stake in the success of an enterprise. Today, it seems that the concept has been pruned back to equate with Shareholder, or Owner. Even employees seem to have been squeezed out of consideration. If you’ll read Meyerson’s piece, he makes a convincing argument that a great newspaper provides a cohesion and sense of identity within a city, and so does a great team. Aren’t a newspaper’s readers and a team’s fans stakeholders as well? Without them, the owners and employees would be looking for other work. Aren’t the local organizations that post their meetings in the newspaper stakeholders? The advertisers?
I’d take it farther than that. It’s not just the shareholders and employees of a company that hold a stake in its success. The luncheonette across the street has a stake in its neighboring businesses’ success. The cops, firefighters, and teachers have a stake in the success of the businesses that contribute property taxes and pay workers who then pay taxes that support their departments. Those same businesses and private citizens have a stake in well-functioning schools, police, and fire departments.
When you get right down to it, we are all stakeholders in each other’s success.
Life is not a zero-sum game, and the sooner we remember that, the better off we’ll all be.
Horse Race, First Furlong
Early polls are fun. They’re pretty much meaningless, but distracting eye-candy for political junkies such as myself who aren’t interested in sports or celebrity mating habits.
And coming into the first turn, it’s…
None of the Above, ahead by 9 lengths.
I’m still sticking with my prediction of Romney/Bachman on the Republican ticket. Gov. Christian-Gathering-in-the-Stadium Rick Perry could change that, and will, if he decides to take advantage of that friendly audience to declare his candidacy and/or have video crews stocking up on potential ad footage for a later announcement. If he goes for it, they’ll still need a Northerner to balance the ticket, but they’ll also need a non-Evangelical, so the default would be Pawlenty. Nobody expects the Veep to be Mr. Charisma.
Logic, the Enemy of the State, Apparently
In the past 30 years, the income of the top 20% has gone up by 20% and the income of the bottom 80% has increased by 4%. Therefore, according to Republican economic theory, the problem is that the bottom 80% is getting too much money. They say that society would be better served if they paid higher taxes and receive fewer services so the top 20% could have more money. This, they claim, would lead to an increase in business activity which would result in more jobs being created.
I read an article recently about the Tiger 21 Club, a self-help organization for New Yorkers with a net worth of over $10 million, which would put them safely in the top 2%, although nowhere close to the top .1%: the Rockefellers, Bushes, and Romneys of the land. One interesting fact is that people in that club (all, the writer notes, self-made, none of that wealth inherited) found that their focus had shifted from gaining wealth to protecting their existing wealth. Translation? Risk-aversion. These guys are looking for safe investments, not providing capital for start-ups. Job creation? Not so much.
When an entrepreneur goes to the bank for start-up capital, it really doesn’t matter whether that money comes from one guy with a million dollars in the bank or from a thousand depositors with an average balance of $1,000. In fact, from the point of view of the bank, small is better. The big fish regularly demand—and get—higher interest rates. Loaning out money from smaller, lower-yielding accounts creates a bigger spread, more profit for the bank.
And don’t think that millionaires leave their money in savings accounts with a rate of .02%. No, a large proportion goes into the stock market, which takes it out of the realm of small business investment. Little fish can’t get into that pond. A business has to grow to the point where the considerable expense of an IPO is going to pay off before the owners can even contemplate going public. In case no one’s noticed, the strategy du jour of large companies, in these days of increasing raw materials costs and slumping sales, has been to squeeze workers salaries and benefits, downsize workforces, and ship jobs to places where benefits like medical insurance are either unheard of or provided by the State. There’s a relation between smaller workforce, lower wages, and lower sales.
Henry Ford was hardly a left-winger, but he understood the relationship between workers’ pay, their disposable income, and his own bottom line. He paid $5 a day at a time when the average factory worker made $2. (Around that time, my mother made $3 a day as a legal secretary. The $5/week she kept, after giving the rest to her mother to cover room and board, paid for her trolley fare, lunches, and clothing.) By paying his workers above average wages, Ford created new customers, taking the automobile from rich man’s toy to American necessity.
Modern businessmen and shareholders seem to have forgotten this. They’ve become enamored of the notion that profits must always go up. That worked just fine when the economy was growing but now that growth has slowed they’ve shifted to a beggar-thy-neighbor strategy that has sent the entire economy into a downward spiral.
This is not just big-boy, major corporate behavior. My husband’s former employers, a family-owned landscaping firm first reduced their workforce, taking each crew from two to one man while keeping their rates the same. As they lost customers, a mysterious number began showing up in the middle of each pay stub. Eventually my husband figured it out. They were taking the actual earned pay, multiplying it by the mysterous decimal and reducing the final pay by that amount. They also claimed not to know what that number was or why it appeared on the pay stub and solved the ensuing Labor Board problem by replacing their hard drives and drilling holes in the old ones.
Their rationale? Maintaining the lifestyle they had become accustomed to during the Go-Go 90′s. I believe this behavior is what were looking at on a national scale. Historically, this has never ended well, and despite the fact that all the “Second Amendment remedy” language is happening on the Rightward side of the discussion, it won’t end well this time, either.
Migraines
As it turns out, Michelle Bachmann and I do have something in common….besides being white females with multiple children over the age of 50.
We both suffer from migraines.
I have no way of telling how severe hers are, but I thought I would, for those of you lucky enough to have never experienced one, give you the cliff notes on the malady.
Migraines are caused by stress. There are approximately 300 known migraine triggers, ranging from motion sickness to food allergies to diesel fumes to tobacco smoke, alcohol, and caffeine to TMJ to eyestrain and the weather, and a given sufferer may be triggered by one or more. It’s hereditary, and more common in women than men. The best explanation of the condition came from my dentist, and here are the Cliff Notes:
Let’s invent a concept called a “migraine point.” This equals one percent of whatever level of stress it takes to bring on a migraine for you. Let’s say that you have a deadline at work, one sufficient to bring on 20 points. Let’s then say that you have to work through lunch to finish the project on time, and that the resulting low blood sugar is worth another 30 points. After work you celebrate with dinner out and a glass of wine, another 30 points worth of stress from the alcohol. You’re at 80 points. No migraine.
But suppose there’s a low pressure front rolling in, and that’s one of your triggers. All by itself, it’s worth 50 points. Now you’re at 130 points and, friend, you have a corking migraine.
This is the problem with migraines. You can’t control all the triggers. Adequate food, sleep, and hydration, yes. Weather conditions and the pollen count, no. Job-related stress or the adrenaline rush when that jackass cuts you off on the way to work, maybe.
But how does a migraine affect your ability to function? Here’s how a migraine works for me:
First, my eye-hand coordination goes. It’s hard to type accurately. Then my eyes have trouble focusing. Unfortunately, even though I have a mild prescription and choose the lightest-weight frames possible, at this point, the weight of the glasses on the bridge of my nose contributes enough discomfort to worsen the rest of the symptoms. The pain gradually creeps up. If the trigger is pollen (and I take allergy meds, thank you) the pain starts in the sinus region and later migrates to the temple. By this time, it’s difficult to form sentences, remember procedures at work, and keep my eyes open. Light hurts. A client gives me their account number and my hand hovers over the keys, wondering which one to strike. But I’m one of the lucky migraine sufferers: I don’t generally toss my cookies.
I’m sharing this for those of you who wonder what this whole migraine thing is and whether or not it should be a factor in presidential politics, not to garner any form of sympathy. I live with it and deal with it, pay attention to avoiding triggers and lay down in a dark room when I can’t.
But I’m not running for president.
Its true that the office of president has the best support system in the world. You have people to cook, clean, dial your phone, fetch your meds when you need them, read lengthy papers and summarize them for you, and do at least part of your thinking. But still, the president needs to be functional at the periods of greatest national stress.
Still, Woodrow Wilson’s presidency continued with his wife Edith at the helm after his stroke. Clandestine, yes. Illegal, yes, but there it was. She ended up with mental problems of her own from the stress of not only trying to do the job but of trying to do it on the sly. I could see Marcus Bachmann slipping into a similar role, without an ounce of guilt. After all, he’s the Biblically-ordained boss of the little wife, is he not? Unfortunately, I also could see Mrs. Bachmann, or whoever’s filling in while she’s in a dark room with a pillow over her head, acting on her fundamentalist beliefs in a moment of crisis and behaving in a way guaranteed to make the situation worse, fueled by a belief that an imminent Armageddon is God’s Will and that she was put into the White House in order to bring about the End of Days.
That doesn’t have anything to do with migraines, of course, but that would be a national headache.
Venture vs Vulture
One of the largest elephants in the American living room has just been outed. Willard “Mitt” Romney’s wealth has become a major issue, thanks not so much to the Occupy folks, but to his Republican rival Newton Leroy Gingrich. In his own defense Mitt cites his job creation record at Bain Capital. He started some big companies: Staples, for one. Although Romney conflates his Bain Capital days as though they were all of a piece, there was a significant shift in his investment strategy midway through his tenure.
He shifted from venture capitalism to merger and acquisition. Let’s talk about that.
Venture capitalism is classical capitalism, using the model pioneered by Queen Elizabeth I and Sir Francis Drake. Her Majesty provided the capital: buying the boat, paying the sailors. He provided the executive experience. If the ship goes down, Lizzy loses her grubstake. If Frank comes back with a literal boatload of spices and silks, they share in fabulous profits. This simple model, the British East India Company, soon gave rise to both the corporation (as a means of limiting the liability of the Queen should the boat go down and the widows and orphans of the sailors show up complaining about starvation and other petty grievances) and the insurance industry.
Risk and reward. Simple as that. Big risk, big reward. (Unless you’re a sailor, in which case, you get a fixed wage in return for risking your life. Life, apparently, is cheap.)
And then there’s merger and acquisition, which won its nickname, “vulture capitalism,” by operating under a different model.
Step 1: find a company with a cash flow problem that has a pot of money tucked away, generally in the form of an employee pension fund. Borrow the money to buy it, putting the loan in the company’s name. None of your own money is at risk.
Step 2: persuade the employees that they can only save their jobs by agreeing to pay and pension cuts, and if that fails, fire them.
Step 3: hire new workers as cheaply as possible, in China, if that works out to be the best deal. Or, if the math indicates, butcher the company and sell off the parts.
step 4: rename the pension fund “executive bonuses.”
Step 5: Collect them, plus “management fees.”
Step 6: find further expenses to cut, to make the bottom line look more profitable. R&D is a favorite target.
Step 7: sell your newly-profitable company to someone else, who has borrowed gobs of money to buy it from you, and is unwittingly signing on to pay off not only their own debt, but yours.
Step 8: collect your millions as capital gains, which will be taxed at a mere 15%. Better yet, have your accountants classify it as “carried interest.” Then you can avoid taxes indefinitely, so long as you let your pile of wealth sit in the corner multiplying itself. Sort of like an IRA, without all those pesky contribution restrictions of $5,000 or $6,000 per year that the rest of us have to live with.
Step 9: move on, not looking back to watch the company you gutted crumble into bankruptcy.
No risk, all reward.
Mitt Romney’s strategy is to pretend that he was a venture capitalist all along, and that any criticism of “vulture capitalism” equals an attack on all forms of capitalism. He’s trying to set up a false dichotomy, getting voters to believe that questioning the business model that exported millions of jobs is a threat to existence of mom and pop businesses.
Want to know what’s a threat to mom and pop businesses? It’s when some bright boy figures out a way to create a national chain in an industry dominated by small, local merchants by using the economics of scale to undercut them, and finds a venture capitalist to fund his plan. You know, like Staples. Get out your phone book. How many mom and pop office supply stores are in it?
The result is that widely dispersed profits that used to support a middle-class life for thousands of families are now concentrated into the hands a a relatively small number of shareholders.
Yes, I know that anyone can buy stock. In fact, as of yesterday’s close, $15.81 invested in Staples would have bought you 40 cents a year income. In order get your $40,000 annual profit, you’d need a grubstake of $1,581,000. Surely, everyone can do that.
Or you can just go to work at Staples. At $8 an hour, all you have to do is work 80 hours a week. Not that they’d let you. Most of their employees are part-time, you know, so they don’t have to provide benefits or pay overtime.
Mitt Romney is the poster boy for the diverging fortunes of America. Newt Gingrich, of all people, is pointing this out.
Predictions & Other Thoughts
1. The big league Republicans (Bush 2.5, Barbour, Daniels, Christie, et al) are sitting this one out in a strategic bid to regain control of the party. Is it because they think Obama is unbeatable? Probably not. Traditionally a bad economy = no re-election. No, the current crop of candidates all kowtow to the Koch brothers wing of the party to one degree or another. The Big Boys are looking at the last time that crew took over: Goldwater 1964, the worst drubbing the Republicans ever took. I’m betting that the Republican Establishment is thinking that the Koch wing and their Tea Party allies are simply too strong to fight right now, but if they lie back and let the electorate bitch slap them, they can put the Bircher genie back in the bottle, tail between its legs, and go back to business as usual, in which the need to throw the occasional sop to the poor and working class is recognized as politically wise.
2. As improbably as it sounds, what with their $50 billion friends to speak for them, the Koch brothers will eventually go bankrupt. Yup. Won’t be the first gazllioniares to belly up. Hunt brothers anyone?
How can I say that? Well, their organization, Americans For Prosperity, appears to be what passes for Herman Cain’s campaign apparatus. This does not speak well of their judgement. And they seem to have a limitless appetite for throwing money at right-wing causes. Go Koch!
3.There are only two presidential candidates who have not yet had their moment in the coveted Not-the-Romney spot: Santorum and Huntsman. I’m betting that Santorum will be next and they’ll skip straight to Romney, bypassing the almost-Romney on they way to the real one. But who knows? Could Santorum hang in there? He certainly checks all the correct boxes. More children than Palin, homeschooled, to boot. Anti-gay? check. Anti-abortion? check. But he’s Catholic. Could be a problem for the Whore of Babylon crowd.
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