First murderer, now enslaver?

With Obama's planned signing of the National Defense Authorization Act,we now face the real prospect of Americans being detained without trial, or recourse to legal counsel or even Habeas Corpus.  I personally am not impressed with the tortuous logic that the Executive Branch, and now the Legislative branch have used to justify this heinous abrogation of our civil liberties.


Obama and his advisors are already guilty of the murder, without trial, of an American citizen (Anwar al-Awlaki), so why should a little arbitrary and without due process detention worry him? 


This whole affair reminds me of the Nazi Party implementing "Protective Custody" to incarcerate their undesirables after the burning of the Reichstag .   Then it was Jews, Communists and Socialists, the Mentally Ill and, well just about anyone they wanted to arrest, and ultimately liquidate.  "Good" Germans sat fearfully by, hoping that the terror the Nazis unleashed on their land would go away.  At first they trusted that the aged Hindenburg would stop the madness, and by the time the woke up to the fact he wasn't able to, it was too late.  Literally millions of deaths, a world war, and the complete and utter destruction of their nation (and every adjacent one as well) later, the "good" Germans were able to say they were never against it, and wasn't a shame.


What will it be for us?  As we're in a perpetual and undefined state of war, and the USA is now the battle field, I guess anyone questioning authority and its decisions are aiding and abetting the enemy in a time of war - Treason under Article Three, Section three of the Constitution:  "Treason against the United States, shall consist only in levying War against them, or in adhering to their Enemies, giving them Aid and Comfort. No Person shall be convicted of Treason unless on the Testimony of two Witnesses to the same overt Act, or on Confession in open Court."


No, it's time to end this unconstitutional grab at our liberties.  Time to dust of our sacred documents and remind ourselves that Freedom is never free, is always earned through the blood of Patriots, and that a modern society is based on the consent of the people to be governed.  Our Declaration of Independence stated this, Jefferson held that a society requires a new revolution every 20 years or so, Washington that society need be armed sufficiently to retake power from any government, and Franklin held that those who are willing to give up a few liberties to secure their freedom deserve neither security nor freedom.


So, are you a "good" American?  Or one who understands your duty to resist this newest tyranny?  Will you trust the Judicial branch (bought and paid for by the same corporations that bring you this Congress and President) to protect your rights?  Will you sit idly by, watch your big screen TV and give thanks to the consumer gods for all the useless crap that clutters your life and demeans your existence, or will you pay attention and do something about this?


Time will certainly tell - but remember it only took about 6 months in Germany to solidify the power of the police state.


Tick


Tock


If you're not pissed off by this point, you really haven't been paying attention.

Can we create a police state? Yes we can

Can we create a police state?  Yes we can.

The audacity of totalitarianism - the United States is now officially a fascist totalitarian state with the passing, and presumptive signing, of the National Defense Authorization Act, which defines in Articles 1031 and 1032  that the executive branch can label anyone an enemy combatant, including US citizens in the US, and imprison them indefinitely with no right to habeas corpus, no right to counsel, and no right to trial.

So, out the door goes at least 800 years of legal prior precedence (so much for stare decisis), as the Great Writ of Habeas Corpus precedes the Magna Carta (1215) which states “...no free man shall be taken or imprisoned or disseised or exiled or in any way destroyed except by the lawful judgment of their peers or by the law of the land.”

One can argue that this was the seminal issue with the nobles' revolt and establishment of the Magna Carta.  And with one deft (well, two if you count the nifty predecessor PATRIOT act) stroke of a pen, Obama will attempt to eradicate 800 years of civil liberty, citing the endless and undeclared war on terror as the reason.  I'd say we should push for a constitutional amendment to rectify this, but it strikes me we already have one which is being blatantly ignored.  (The Fourth Amendment for those of you counting)

This is a patently unconstitutional law, and should be vigorously assailed at every turn.  It'd be a great time to join the ACLU if you don't already belong.

Media Matters or why you shouldn't necessarily believe what you see / hear / read in the media

Much of what we base our opinions on is based on what we read or see in the media.  The topics that are covered, the content and tone of the discourse we're exposed to, all this shapes and influences the perception we have of the world around us, where we perceive there to be good, and where we perceive there to be evil or bad.


The media can be either a great source of diversity of thought and transparency of society, business and government, or they can be shamelessly propaganda.


Our open and free society is based on several tenets, one of which is a diverse and active free press.  A free press is one of the fundamental pillars of a democratic society, and our founders we prescient enough to mandate it in the Bill of Rights in the First Amendment.

John Mayer got it right when he sang:

"And when you trust your television 
What you get is what you got 
Cause when they own the information, oh 
They can bend it all they want"

A diverse and locally based free press leads to diversity of opinion, diversity of views presented.  If this diversity is narrowed or abridged, then we will have less of what makes us free.


Over the past 30 years, even as the venues for the media have increased with the advent of the internet, we have seen an unprecedented consolidation of the channels of information that keep us informed, and keep us free.  The chart below shows concentration of media over an 11 year period from 1993 to 2004, increasing from 50 companies owning 90% of the news and information outlets in the US in 1993, to just 5 in 2004.

Media Reform Information Center

Just what these five mega corporation own is outlined in the chart below - an astounding concentration of power in a few companies. 

Media Literacy, Section 001, Fall 2011, at the University of Minnesota

Links to the media holding of each of these companies can be found here: Media Ownership


With less diversity, and the consolidation of news desks from local offices to regional and then national news desks represents has led to less reporting on local issues, and hence less transparency in government and governmental agencies on a state and local level, as well as to a consolidation of media point of view to a very few individuals.  Not to be a conspiracy theorist, but this means that the leadership of these five companies control what the majority of Americans see of the world - the very information they use to form their world views and determine how they interact with each other and society.


Think about the level of discourse you've personally experienced on TV, or the Radio and how this has changed in your lifetime.  I remember the statesmanly Walter Cronkite, the humorous and irreverent Andy Rooney, the insightful yet acerbic William F. Buckley.  Where have these men and their ilk gone?  They no longer exist, having been replaced by charlatans like Rush Limbaugh and sensationalists like Ann Coulter.  Increasingly, young Americans are relying on comedians for their information from Jon Stewart who professes to NOT be a journalist.


Increasingly what is called news contains shameless product placements and corporate press releases, unedited and unchallenged by increasingly complacent news desks.  With no budgets and pressure from corporate to conform with policies and mandates, even the most committed journalist will be beaten into submittal within a few years, or leave the field with no place to go to.


So when you see the latest images on TV with the corporate narrative behind it, remember that you're being fed what the corporations want you to hear.   And they've increasingly gotten unashamedly blatant about twisting or down right misrepresenting the facts - going as far as to fabricate what they present as truth.


Don't settle for this and complacently act on the drivel you're being fed.  Seek out other sources of information.  Read the Canadian or Australian newspapers every now and then.  Try Russia Times for a laugh and a challenging set of perspectives.  Yes, watch the Daily Show for Jon Stewarts humorous and often cutting view on reality.  And armed with multiple perspectives, then decide on your own narrative.  Because you're being fed shite from the mainstream media which, in its arrogance, doesn't even care what you think because they've realized you don't matter.

A Modest Proposal for the 21st Century

Recently there's been a series of articles going around the internet about a couple that lost their home in Tennessee because they didn't pay a $75 annual fee (the firefighters came to the fire, not to put it out, but to make sure it didn't spread to nearby homes that had paid the fee), and more recently about counties in Georgia that are considering using prisoners to augment their fire fighting departments to save money and make vital services more affordable. (On a separate note, where else but the south would they even consider this - I'm looking for the chain gangs of my youth to return in road maintenance projects soon - I sort of dug the striped duds the prisoners wore.)  Of course, ever the realists (unlike administrators who apparently are the dreamers in this situation), The fire fighters complain that having prisoners would break the community trust as homeowners would worry that the combined group would steal from them.  


Which leads me to propose my own Modest Proposal for the 21st of my own (Jonathan Swift watch out!  Newt Gingrich watch out!)


There's any easy fix to both problems, and to addressing scofflaws in society in general.  Eliminate personal bankruptcy completely, and reinstitute debtors' prisons - if you can't pay your credit cards, you go to a debtor institution where you're afforded an opportunity to work off your debt.  The prison would act as a job referral agency, matching scofflaws with value added work in the community, potentially including firefighters.  After paying a modest charge for lodging, security, meals, and administration (say $80 or $90,000 a year), anything the debtor earns above this would be applied to first the accumulating interest on their debt, and then to their debt.  Eventually they would be debt free, and have learned some real market valued skill sets they can apply in the geriatric ward upon their release.


This is a really exciting concept, we could return the concept of legal inter generational debt obligation (as a child of a scofflaw it is your responsibility to pay of the debt as well), and afford the children of debtors the opportunity to learn real, viable, job skills.  None of these namby-pamby liberal arts learnings like music or fine arts (who hires these folks anyways - it's just a poor decision and we should protect them from making it) - no, the children could learn to be janitors like Newt Gingrich is proposing (he's so my hero for this fine, well thought out suggestion, except I worry as a modest proposal it might outshine mine).


The economic benefits of this are astounding.  


First - Debtors have a chance to pay off their debts, rather than living with the crushing reality of never being able to pay for all the stuff they bought with the credit cards they never should have had.


Second - Industry has an opportunity to hire skilled, low cost labor to become competitive with overseas slave societies like China or India. 


Third - the youth of our country could learn real, salable job skills through on the job training.


Fourth - Banks could sell the past due debt to these Debtor prisons, and the individual be incarcerated with I believe only an administrative procedure - no more expensive bankruptcy filings clogging our court systems and draining pubic funds unnecessarily.


I could go on, but you get the point.  The concept is brilliant, timely and resolves many of our deeper societal issues by reinstating accountability for your actions into the equation.


You must admit this is a great idea, - this Modest Proposal for the 21st Century.  Join me in writing your Congressman (chose the one most funded by the prison industry, they'll listen because they know which side of the toast is buttered) to demand a return to debtors prisons as a way to solve our competitive issues and address the lack of moral values that have evolved over the past 40 years.

Gingrich is a total Tool

So Newt on OWS: "“Let me take that for a brief moment to describe Occupy Wall Street. All of the Occupy movement starts with the premise that we all owe them everything."

Gingrich Being a Tool

Herein methinks he doesn't have a frickin' clue.

The OWS movement is about revisiting rules that have been calcified over 40 years that direct 95% of any improvement in productivity to 1% of the nation.  That create tax laws that ensure this perpetuates itself.  That value Capital over Labor, losing any sort of a balanced perspective, and that have sold our legislative and judicial systems to the highest bidder, depriving the 99% of any sort of real Democracy.  They're protesting the sham of a political process where, two parties bought and paid for by the corporations owned by the 1% (OK, by the top 5% in this case) create no real change, only useless gridlock which isn't even entertaining anymore.

The fact is, if you look at it, if you aren't part of this group, the odds of you ever being a part of the group, or even improving your measly lot in life are pretty slim for most Americans.

So Newt, why don't you get a job that doesn't involve leveraging your political position with corrupt companies to make a couple million a year?  Something real and tangible that adds value to the US.  You once were apparently a good history professor - why don't you try teaching history again.  And stop displaying your ignorance and total tool status in debates on nationwide TV.

11.11.11

On today, Veterans day 2011, 10 years into the Global War on Terrorism -


My fellow veterans: I salute you. Thank you for your service to our great country. I'm proud to have served and I know you are too. 

(stolen shamelessly from Monique Hayden Gary with whom I served not once, but twice, on two continents)


I saw a chart the other day that something like 0.45% of the American population has served/are serving in the Iraq and Afghanistan wars / occupations. This is down from something like 15% for WWII and 4% for Vietnam.

This is why the government and society can pay lip service to admiring our citizens in uniform, yet in actuality do nothing to support them. (Note the funding and state of the VA, burying remains of fallen servicemen in a garbage dump at Dover AFB etc.)

As a decision maker in the political or economic systems, you might know someone who knows someone in the service, but the odds that you or an immediate family member have or are serving are miniscule. And that's what's wrong with the military-industrial complex we've built - there are no longer personal consequences for the decision makers for employing our sword, or trying oil or resheath it.


So on Veterans Day 2011 remember, respect, support.  And please think about the system we've created that encourages us to put our brave citizen soldiers, airmen, marines and sailors in harm's way, and support them after they've served or given their all.

In God We Trust

A response to Congress  reaffirming this week as the national motto the phrase "In God We Trust" and encouraging its pronouncement on public buildings and continued printing on the coin of the realm. 


See the LA Times for an article on this matter.


Who's god?  Or gods for that sake?  Yaweh?  Allah?  "God"?  Ganesh is a favorite of mine - let's make Ganesh our god we trust in to provide, direct and favor us above all other nations on earth.  


For 175 years (give or take until 1956 that is during the hysteria of the Cold War and under the influence of such great American leaders as McCarthy) we realized that religion is divisive and plays no place in a modern, post - theocratic government.  This is why the Pilgrims and many colonists came to this nation in the first place - to get away from state religions.  This is what the Enlightenment was all about, and arguably why European nations have ruled the world for over 400 hears.  Let me hear the words - "Separation of Church and State".


While living a just, moral and contributory life is an integral part to being a human being and a member of society, there's no place for Congress, or your city council for that matter, to legislate morality.  Legislate actions, behaviors.  Outcomes.  But morality?  Please.


Your religion is your business.  No one else's.  And plays no role in the development and management of a well run secular society.


Now if you'd like to like in a Theocracy, where religion is major part of the governing of a people, then I'd suggest you move to Iran or Taliban controlled areas of Afghanistan.  Just watch out for those who might take issue with your god, or your interpretation of what he, she or it is telling you to do.  

Why don't they just get a job?

This is a typical comment from most my conservative friends - and they do somewhat have a point.

Most everyone I've known more than 20 years have made their way in life through hard work, many by serving in the military as I did.  They worked McJobs, they were baristas.  So their point of view is that, if they pulled themselves up by their bootstraps and made something of themselves, why can't all these OWSers?


Good question, but sort of missed the point in my estimation.  The world is full of individuals who've been successful despite the obstacles thrown in front of them.  Many haven't succeeded. Why should we knowingly create an economic and political system that favors the few to the detriment of the many?  I think this is the issue on the table here, not why can't a group of protestors get employed.  It's about the systemic destruction of opportunity for anyone but the already privileged, and whether that's the world We the People want to make ours, or if there is truly a better one out there.

When Citibank begins marketing financial products to the "Plutonomy" (clever taking a concept, changing the suffix and making it a trade-markable item) you know we're in trouble.  They don't even care about keeping the topic quite anymore.  (See this article on Plutonomy to get started on the details: Times Colonist)

What's really amazing to me is how the upper middle class (lets say the top 20%) have bought into this line of argument.  Coming from a world of relative privilege compared to the bottom 80%, yet a stone to the sun compared to the 1%, they've adopted the liturgy of the wealthy in some misguided belief that they too will get there.  They've been to the best schools (their parents' money can buy), networked into powerful business relationships, and are set to make their $250,000 or so a year, and somehow this has convinced them that they've succeeded on their own merits.  In reality, they've neither succeeded (A hedge fund manager can make $250,000 a day guys), nor competed on their own merits (they were favored from birth.)

If this group (which I'll agree I too belong to in comparison to the bottom 60% - I'd say I've moved from somewhere around the 60th percentile where my parents were to somewhere in the 3rd to 5th percentile today) can't see the disparity we've created in opportunity, and the wasted potential this represents for all of us Americans, then we're in trouble.  For as the Terror taught la France, so too shall OWS teach America - when the vast teeming masses that make up the bulk of this country see no future, no potential, no ability to improve their lives for themselves or their children, then things can and will get ugly.

Proposed Talking Points for OccupyWallStreet

After dropping by the Occupy Seattle non-camp ground yesterday I realized that the time has really come to begin coalescing this movement around a few basic efforts that more than the fringe can identify with.  I mean really, there might have been 100 people there, and they were all younger than 30, full of tats and dreds.  Not a middle class person amongst them.  The movement clearly needs a more inclusive theme other than nuke the banks or kill the capitalists.


This made me start thinking about what the theme might be, and today I had a great cab ride from my Client to SEATAC here in the People's republic of NorthWestia that really helped clarify my thoughts for what the talking points for the OWS movement should be.  I owe a debt of gratitude to my cabbie, an elderly gent from East Africa who spoke little English, but actively commented and drove home the points that I've been trying to clarify in my head for months now.


The conservative media has dehumanized and vilified them; most central in their message is that this is a rag tag group of discontents who have no platform to promote.  They acquaint OWS with the masked anarchists who have shown up at so many other anti-establishment protests.  And somehow they miss the point.


OWS today is an exciting example of Democracy in action.  It's gritty, unorganized.  A group of people with an enormous set of issues looking for a common direction that they can mobilize both themselves as well as a sizable chunk of the US around to make what they hope is real change.


Central to their complaints, I'll say central to OUR complaints are two themes that, if addressed would enable a democratic process to emerge in this great nation to address all the others.  I propose these as starting points to productively resolve our issues.  I think they'll both take Constitutional Amendments, but  with the power of social media and the internet certainly we can get sufficient energy around these to get them passed:


ISSUE ONE: CORRUPTION


Our current governmental system is corrupt and no longer can claim to legitimately represent us.  Our representatives are bought and paid for by wealthy individuals and corporations who, through campaign contributions buy access and action.  It's pure pay for play driven by greed, and the need to compete in dollars with other candidates.  At what point did we agree to let a dollar represent one's worth in society?  


PROPOSAL


Contributions to elected officials or candidates for public offices shall be limited to no more than one day's average wages for the bottom 20% of Americans.  It shall be a felony to give more than this amount to any elected official or candidate.  It shall be a felony to receive more than this.


PACS and other aggregators of funding shall be illegal and disbanded.  It shall be a felony to establish one, a felony to contribute to one.


ISSUE TWO:  PERSONHOOD


Last I checked our Constitution read "We the People of the United States" not "We the Businesses of the United States."  Corporations are not people, no matter what tortured legal thinking you apply to the issue.  


PROPOSAL


Corporations do not have the legal rights of persons.  Therefore they shall not be permitted to contribute or give money to any elected official or candidate for office.  A corporation found to be doing so shall have its license to do business in the jurisdiction the offense occurred REVOKED.  (If found giving money to a state official or candidate they shall be forbidden to do business in that state, if found giving money to a US Governmental official or candidate they shall have their right to do business in the US REVOKED.




By doing these two things we can take the money and power out of politics, and reintroduce a democratic process in our great nation.  We once more can have real elected representatives, not the charade of options presented by the two equally corrupt parties today.  Once we've done this we can address all the other issues the way a democracy is supposed to - by open dialog and debate.  It will be messy.  It will be contentious.  But at least it will happen, rather than being shoveled under the carpet the way it is today.

Rethinking Occupy Wall Street

So the interesting thing about Occupy Wall Street is that the protestors seem to be asking the government, which is a wholly owned subsidiary of corporate America thanks to the fiction of corporate personhood and the treasonous practice of campaign contributions, to increase regulation of the very corporations which own it. 


And then we're surprised that the police, the enforcement arm of this corrupt (and therefore I'd say illegitimate) government violate the civil rights of the protestors? This is the same government that, ignoring both our own and international laws, has been using extraordinary rendition to do away with foreign "terrorists". The same government that has executed US citizens without trial. And you're surprised?

No - it's time for a major shift in how we think about what legitimate representation is, what the role of government is in our society, and how we the people (the 99%) agree or not agree to engage in discourse or interaction with a corrupt and illegitimate government. I'd suggest a re-read of Voltaire and other Enlightenment philosophers about what a legitimate government looks like. Or even easier, re-read our own Declaration of Independence:


US Declaration of Independence

"We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.--That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed...."

Dissent is Patriotic.

If you aren't pissed off then you haven't been paying attention

Once again I agree with Ron Paul - well sort of ...

Ron Paul is dead on in this piece on the need to define the sanctity of life in America, not the first time that I've agreed with him, much to my chagrin.   However, I'd guess where I'd part ways with him is on how we do this, and the implications for our domestic, economic and social policies.  I see no role for government telling a woman what to do here; having said that, I'm generally anti-abortion except in early stage pregnancies (say first trimester) and where the life of the mother is at stake.  I hear a lot of talk about incest, rape or other situations, but I think these can easily fit within that first trimester.


Ron Paul on Life

On a broader topic, that of life and the sanctity of it in general, and the need to have an agreement in place for our society to lay a moral compass for our actions - absolutely.  Having said that I'd move to two places - war and poverty.

On war - what is different between a late term abortion and sending one of our citizens to some hell hole and having them either kill or be killed?  Usually it's economics or some misguided principle of nationalism that we haven't fully though through.   I'd say it's incredibly hypocritical to be virulently anti-abortion and pro war simultaneously.

On poverty - if life is sacred, should we be focused on creating an environment where those alive can live a fulfilling, meaningful life without the pains of hunger, homelessness and sickness?  Shouldn't our public policies be maximizing the happiness of the maximum number of people we can?  How can we, the greatest nation and people ever to have existed, live with ourselves with 16% of the nation in extreme poverty, >25% of our children going hungry at night, and the degree of homelessness we have today?  I'm staggered by the evident hypocrisy of those who would try to impose their will on women through so called "pro-life" policies and dogma, yet allow this condition to perpetuate and grow worse.

Thoughts on the Brink

Here we are, 4 days from what could prove to be a complete global financial meltdown, and I've been pondering how we got here.


Not the fact that the buffoons in Congress can't come to an agreement - I've long since given up hope of our American political system acting in a responsible and sane manner.  It's too caught up in the media hyped blame circle pandering to their narrowly defined bases and corporate sponsors to think that they would be able to reach a reasoned agreement on anything of substance.  No, rather how did we get to the point that we have a $14 Trillion debt, earmarked or priority spending levels where they are, and have no maneuvering room.  It's worth pondering.


I, like many people out there, have a point of view on this.  However my view doesn't fit nicely into minute thirty sound bites on CNN or Fox News, and that it requires you to think about cause and effect over decades. It starts with Nixon and the supposed collapse of the Republican party after his near impeachment.  This was followed by the development of Conservative and Neo-Con think tanks in response to  the real prospect of Business losing their control of Washington, and the development of long term plans (in the 70s) to reinstitute a facade of democracy in this nation covering the absolute dominance of legal and judicial processes by business interests.  What's interesting about this is that while these Think Tanks have always resisted revealing where their funding comes from, they never been shy about communicating their focus and intents.  It's been there for you and me to see for 40 years now.


In the '80s Reagan modeled with the Soviets what I believe the Republicans have succeeded in doing to the Americans in the '00s and today.  He simply outspent them and forced them into a corner where they had no alternative but to give up and sue for peace.  This lead to arguably the greatest single freedom event in history as the Berlin Wall came tumbling down, and the Soviet economy was revealed to be the Potemkin village it really was.


25 years later the Republicans, with Bush as their front man, armed with a military mandate derived from 9/11 and an economy on the skids from the dot bomb, managed to accomplish two major things that have driven us to our current dilemma. 


First, playing upon our fears in the clouds of the crumbled towers, they launched both a massive expansion of the military (with its spending) plus they mired us in two wars that continue to this day.  Our current military spending is over $1 Trillion a year (Counting appropriations and black ops budgets) - approaching 25% of the Federal Budget, and greater than the military budgets of all other nations on earth combined, and on top of that we've incurred at latest estimates a $4 to $5 Trillion debt to run the wars in Iraq and Afghanistan.  


Second, this stroke of budgetary and resource allocation brilliance was coupled with another - a reinstitution of Supply Side economics, that utterly failed policy that, guess who, Reagan brought forth in the '80s.  After 25 years everyone seemed to have forgotten that, by cutting the taxes on the wealthy in the 80s, we accomplished nothing, other than to prolong and deepen the recession we were in.  As a result, right as we were expanding expenditures, we cut revenues, betting on the come that this would result in an expansion in GDP as the wealthy, in their infinite wisdom, invested in business opportunities that created jobs in the US economy.  (We'll come back to that one in a minute)


Fortunately for Bush, the artificial inflation of the economy driven by the soon to be emerging Mortgage crises covered in the short run (2002 - 2008) any issues supply side economics might have created.  For those of us who have forgotten (it was after all three years ago - several dogs years in our ADHD media cycle and two Congresses ago), a relaxing of governmental regulation and financial standards allowed mortgage brokers to underwrite mortgages to people that would never be able to repay.  After this stroke of regulatory brilliance, the financial institutions were then allowed to commoditize these mortgages into homogenized debt offerings that assumed that, while any individual mortgage might fail, certainly the entire portfolio wouldn't.  I could try to explain this, but I don't have 100 pages and a month to do it, and it has been done really well already - look at Matt Taibbi's excellent and entertaining book Griftopia-Machines-Vampire-Breaking-America.  Also Dilbert explains it in a much shorter version:

This perfect storm of regulatory ineptitude coupled with greed and avarice led to the greatest financial meltdown since the Great Depression, and, guess what, required investing over a Trillion dollars more in propping up a lethargic and struggling economy.  We now have something like 16% un- and under employment (U-6 I believe).


So coming back to supply chain economics - that mantra of the neo-conservatives and savior of the rich. As I said above, the premise is that, by cutting taxes on the rich, they will have more money to invest in the US economy, creating jobs and ultimately lifting everyone out of economic trouble.  Unfortunately the global financial economy has significantly shifted in the past 30 years under the US lead World Bank and IMF and their financial policies (See Joseph Stiglitz' Globalization and Its Discontents if this interests you at all - worth a read by the Nobel Prize winning economist).  Today, rather than investing in the US, increasingly Global companies have realized they have greater returns and diversify risk by growing brands and operations outside the US.  As a result tax breaks and corporate incentives increasingly have little, if any effect on our economy, serving to grow corporate earnings with little if any employment impact in the US.  Couple that with lower cost labor alternatives overseas driving an outsourcing trend for the past 20 years and one has to wonder why there are any good jobs left in the US at this point.


Putting all this together all its clear that the neo-Cons and Republicans have lead us to the brink, painting us into a corner from which there really is no exit.  They

• deliberately overspent in the 00s, raising the debt to the $14 Trillion mark
• through regulatory "reform" have created an economy that can't make jobs
• created non discretionary buckets of expenditures that leave no room to maneuver, and
• are now citing "philosophical" reasons that they can't even begin to discuss revenue enhancements to address the issues they've created in the first place

Gotta love it eh?

As an aside, while I've been lambasting the Republicans here, the Democrats are every bit as culpable through their ineffectual meanderings and inability to find a platform to promote.  While the Republicans have successfully implemented their strategies and tactics to get us to a point where corporate take over of the US legislative process is at hand, the Democrats have been clowns on a stage they weren't even aware of.  I honestly don't know which party to despise more, so I'll despise them equally for different reasons.

So now, with the US on the brink of default, which would challenge 60 years of global financial market management where the US debt is considered to be risk free, can we find a compromise to our problems?  No. because it's against everyone's principles.  

The Republican's approach to negotiation is akin to Bruce Willis' negotiation in the 5th element.  Remember the scene?  Ugly aliens have taken over the luxury cruiser and demand to negotiate.  Bruce asks if he can take over negotiations and proceeds to shoot the ugly aliens.  

The Democrat's approach to negotiation, as led by our enormous disappointment of a president Mr Obama, is to roll over at the first request for something and offer more than was asked.

In short, we're up S*&^%s creek without a paddle, and Tuesday the 2nd is just around the Corner.

So I hope you've pulled your money out of the market and invested in gold and firearms.  I wish I had at this point.

Good luck!

Response to Chris Walen - "“No Downside” to Not Raising the Debt Ceiling"

Chris Walen, some time "banking industry analyst and co-founder of Institutional Risk Analytics" recently stated on the The Daily Ticker that there's no down side to not raising the debt ceiling:


"My view is that Congress should vote down any debt ceiling measure unless President Obama agrees to sign the balanced budget amendment. Even if Secretary Geithner has to run the US government on cash, like the good people of Iceland and Ireland today, it will be a good thing for America's political debate to default — at least for a few weeks. Then people will know that the once unthinkable is very possible."


Let's take a look at his assertion for a second:


Geithner and other fiscal policy makers are no doubt driven by the uncertainty principle in finance (not unlike Heisenberg's uncertainty principle in Physics) - it's a basic mantra with economists and financiers.  ANY uncertainty in the underlying assumptions or mechanics of the markets MUST be eradicated, for only with certainty can efficient economic markets function (or other words to that effect.)


What Mr. Walen proposes to do is inject uncertainty into the markets.  So what's interesting is that no one really knows what would happen if the US defaulted (which is what we're really talking about, even if it's a few days or weeks) on its debt. What is known is that every economist, banker, treasurer in the world uses a basic assumption of the "risk-free" rate to be US government debt. Every other rate in the world is in some way based on it. So for the US to default on its debt, even for a matter of days, could have the equivalent effect of us waking up one day and discovering that the laws of gravity were annulled, and the moon had left its orbit about the earth ... Or not.

But for a "banking industry analyst" to assert there's no downside to allowing this to happen is simply irresponsible, or slavish adherence to some dogma that has no basis in fact or history. Truth is we don't know.


But wait!  "All he's saying is that we should cap the debt and pay the interest out within that cap" you say.


Perhaps, but let's look at the reality our friends in Congress are dealing with.


This suggestion is only valid if, as part of the process, Congress is clear that debt is serviced before anything else including essential services, military, fire fighting, CDC etc.  We'll have made a point of paying debt holders their interest before ensuring the national trust and security. Goodbye pork barrel legislation that buys all those corporate campaign contributions.  While we could spend days or years arguing the merit of this as a decision, and its consequences, the ONLY way to not raise the debt level without a priori addressing the spending issues is to agree to something like this.

I guess another nit to cite is that Social Security, which makes up about $760BN in the current budget (if memory serves me right - it's almost identical to military spending before black ops (estimated somewhere between $50-100BN a year) or off budget military spending including the wars in Iraq and Afghanistan (currently running something like $50BN and $120BN for 2011 (Congressional Research Service - page 7 note the chart)) is non discretionary spend which ostensibly has its own source of funding (the $2 - $3 Trillion set aside in SSAN payments). This, coupled with other non-discretionary spending (Medicare - $468 billion, Medicaid - $269 billion, (both of which have independent funding sources) TARP - $13 billion, and all other mandatory programs - $598 billion.) totals $2.1 Trillion out of a $3.7 Trillion budget. (About.com US Economy)

Some other inconvenient truths here:

1) Debt servicing (the INTEREST we pay on treasury notes, bonds and other Federal Debt) is about $241 BN in the current budget, or about 15% of total discretionary spend. (GovernmentSpending.com)
2) Somewhat dated (as of July 2010) but likely still directionally direct - the average maturity of Treasury debt is about 55% maturing within 36 months (~30% within 12 months), which means that we have to reissue about $4.2 Trillion in debt within the next year to stay at the current debt ceiling. (Presentation to the Treasury Borrowing Advisory Committee U.S. Department of Treasury Office of Debt Management February 1, 2011 page 20)

So, put plainly, to move forward with capping the debt we have to be prepared to:

1) Cut 15% of the discretionary budget immediately - given the incredible lack of foresight or intestinal fortitude shown by the current occupants of the Capitol Building (both sides of the aisle) I'd say we have a better chance of a small planetary body striking Washington and destroying the planet, thus eradicating the problem entirely with no work involved (they can all breath a sigh of relief!), and/or
2) Refinance the existing debt (for certainly we wont be able to retire any of it given constraints identified above) with increasing expense (e.g. higher interest rates), which
3) Leads to debt servicing occupying an even greater portion of the discretionary spend leading to
4) repeating at point one ad nauseum.

So unless I've missed something, to facilely suggest, as Chris Walen implies, that we should freeze the debt ceiling without increasing revenues and/or decreasing outlays FIRST, without catastrophic consequences coming from some quarter, either through defaulting on debt covenants, or by essentially shutting government down by dealing with the debt servicing issue, is misinformed at best.


Personally I think there's a better chance of waking up and finding the laws of physics have been overturned than for Congress to successfully freeze the debt ceiling as Chris Walen has proposed.  The banking system will yank the rope they have Congress by balls with just like they did during the last financial fiasco (the market melt down of 2008) and get them moving.  Look to Gierthner and other financial mavens including the heads of the banks to increasingly get shrill about this in the next few weeks.


Meanwhile,  I look forward to seeing the Moon spiraling out of orbit, being able to leap tall buildings in a single bound (but wait, how do I get back down with no gravity?) and other such fantasies!

Response to 11th Circuit Court of Appeals discussion on "Obamacare"

As reported in the LA Times today, the 11th Circuit Court of Appeals is considering the constitutionality of Obama's healthcare reform:


"the judges opened the arguments by saying they knew of no case in American history where the courts had upheld the government's power to force someone to buy a product."


And Acting U.S. Solicitor General Neal K. Katyal raising the point:
"... that healthcare is unique and unlike purchasing other products, like vegetables in a grocery store. "You can walk out of this courtroom and be hit by a bus," he said. And if such a person has no insurance, a hospital and the taxpayers will have to pay the costs of his emergency care..."


Interesting if facile questions all around by the bench. Really the only issue at stake here is  can the government mandate an individual to purchase a product?

So let's think about it - you are required (by law, duly passed decades ago and in force since in every state that I know of) to purchase auto insurance as part of owning and operating a car - so we've opened the door on mandating purchase of a service already. (Although arguably you do have the choice of NOT owning and operating a car, just good luck getting anywhere or earning a living without one in our auto-centric communities) So to through out that they've never heard of government having these powers before is either a disingenuous belief, or an outright falsehood-which is it?

On this topic remember George Bernard's prostitute joke (see The Independent- at the bottom of the article) which certainly applies: 


"Best joke about prostitution ever done was by Bernard Shaw. He was at a party once and he told this woman that everyone would agree to do anything for money, if the price was high enough. `Surely not, she said.' `Oh yes,' he said. `Well, I wouldn't,' she said. `Oh yes you would,' he said. `For instance,' he said, `would you sleep with me for... for a million pounds?' `Well,' she said, `maybe for a million I would, yes.' `Would you do it for ten shillings?' said Bernard Shaw. `Certainly not!' said the woman `What do you take me for? A prostitute?' `We've established that already,' said Bernard Shaw. `We're just trying to fix your price now!'

The second issue raised here (and frankly immaterial from a legal standpoint, but important to understand from a healthcare reform standpoint) - is whether we want to admit it or not, you and I already pay for all the uninsured - and at the absolute highest rates you can think of.

The uninsured wind up in Emergency Rooms with life threatening conditions, often at end of life. Our laws prevent ERs from turning anyone away in this condition (can you imagine a society where someone with a GSW to the head is turned away from the hospital because they can't show proof of insurance? Not sure I want to live in that country). Because of this, the state agrees to pay the ERs for anyone who can't pay - and where does that money come from? Well you and me in the form of taxes. 


So to put everyone into some form of a health plan is actually a cost savings device - it should lead to earlier, lower cost interventions for many of these people, and should also ensure that we're paying negotiated rates and not rack rates. (as an example I just had lab work done - rack rate if I didn't have insurance - $650, with negotiated rates - $54. Sort of begs whether Healthcare providers are engaged in discriminatory pricing in violation of Robinson-Patman, something I'll leave to another day.)

Lastly on this point - by mandating coverage, the state can entice private insurers to come to the market with products designed to be compliant with the regulators mandated design for minimally compliant healthcare plans. Without creating the market for 50 MM new members, the insurance companies will not bother. Plain and simple. (I used to manage Product Development for one of the major West Coast healthcare insurers ...)  The only other reasonable alternative would be to go to socialized medicine from the start, by-pass how we entice private ensurers to enter the market and deliver the services directly.  But we don't want to go there.  Do we?

There's lots that is wrong with "Obamacare" that should be changed. But if we're going to challenge its consitutionality let's stay focused on the powers of the Congress to act, and not mix that up with whether it's a good bill that should be continued and implemented - that's not a question for the Judiciary, that's for the Legislative branch of the government.

7 minutes ago · 

Failing grade for California Educational Budget Policies

The LA Times reported today (More non-Californians are offered freshman slots at UC schools) about the disturbing trend of the University of California increasing the number of out-of-state freshmen to make up for budgetary shortfalls.


The UC System is built and funded to provide California's children a world class education - part of our state's collective effort to help our citizens achieve their dreams and create a more vibrant economy. This is one part of the reason California  used to be the 6th largest economy in the world. 


Fact is that, due to budget cuts and revenue shortfalls, they now need to raise more money from tuition than before - out of state tuition is now $34K (UC out of State Tuition), about 3x in-state tuition of $12K (UC in State Tuition)- do the math. 


What this means is that our educational institutions are no longer fulfilling their mission to the state in terms of delivering on the promise of improving education for state residents. 


This is due to revenue (tax) and budget shortfalls and choices we are making as a state about what to fund, and not to fund. Real tradeoffs are being made that the average citizen either isn't aware of, or doesn't care about. For example - we decide to fund prisons ($9.4 BN in 2011 up from $8.6BN in 2009) (CA Corrections Budget - look to page two, bottom of the page for summary by year) to the detriment of UC funding ($6 BN proposed down from$6.4 BN) (CA Education Budget - read the first line for UC system).


The choice we are making as a society through our elected representatives is clear - less educational and economic opportunity for our citizens coupled with more funding to lock them up when, unable to get good jobs due to lack of opportunity and education, they break the law. Couple that with fewer in-state students because the UC system needs to raise revenue, and you have a vicious cycle that we're feeding through public policy gone wrong. 


If you aren't pissed off then you simply aren't paying attention.

Perpetuating the Welfare Society

As the debate about what we can, or can not afford as a nation continues we have some tough choices to make.  Seems to me that ideology is getting in the way of open and considered dialog on the topics that face us, and what we as a society want to be.

What values will we use to determine where to invest or not?  What can we afford and what can't we afford?  What role should the government play and where should it steer clear?  One issue (among many) is the role of government in creating a level playing field and support structure for our citizens to live and work within.  Looking at the Obama proposed budget for 2011 (NY Times Budget Analysis), something like 63% of the proposed budget goes to Social Programs (about $2.4 Trillion out of $3.69 Trillion. (1)  All I can say is WOW!  That's a lot to be spending.  This has to beg some basic questions:

1. Is there a problem here worth focusing on?  
2. Should we be investing in these things?  Is it really the government's role to do this?  Should it be the Federal Government's role? Or should it be left to someone else?  
3. Even if the Federal government should be investing in these matters, is it doing so in a effective and cost efficient manner? All weighty questions worthy of discussion and debate.  

Unfortunately all we seem to be getting from both sides of the aisle is rhetoric and an uncompromising restatement of core belief statements.   I don't see any real effort being made to get the issues on the table and have an honest dialog about them.  Rather I see grandstanding and so called principles based discussions.  In other words, I can't compromise without breaking my principles, so we won't even talk about the issues.  Rather we'll shout past each other and throw our hands up in disgust when the other side won't agree to our demands.  Frankly the process makes me sick and begs whether our form of government, to use a Donald Rumsfeld saying, is a "quaint anachronism" requiring a total overhaul - topic for another day perhaps.

So in an effort to start a dialog on the issues I'll lay out some premises and understandings.  Today I'll try to address the first question - is there a problem here.  For if we can't agree there is a problem, then certainly we'll never be able to agree that we should do something about it.

Is there a problem here worth focusing on? 

We've heard a lot about free markets, minimalist government and a desire to take back our hard earned tax dollars.  Laissez-faire capitalism seems to be all the rage these days.  However, let's be clear - we don't have free capitalism in the United States.  There isn't a level playing field for We the People to compete on.  Rather, we've systematically created a situation where a very small number of people have enormous advantages over the rest of society.  To believe that somehow the rest of us can succeed in this system is foolhardy, and needs to be challenged.

Further, Laissez-faire capitalism is a cold, hard world.  It's truly the law of the jungle where innate ability and drive determine your lot, and if you're on the bottom of the ladder you get trampled.  Recent economic history shows just how bad this can be with the Great Recession here in the US.  Driven by corporate greed in the financial sector, and unregulated by the Government (I recall when the Glass Steagall act was repealed in 1999 telling myself and others that this surely was the beginnings of financial market collapse - the surprise to me was that it took 9 years to happen), millions of Americans were put out of work following the market crash.  To policy wonks and economists these may be "market transition" effects, to common Americans this is a tragedy they can neither forecast nor control. .  Something close to 60% of Americans have less than $12,000 in savings - a nest egg that is easily wiped out in turbulent times.  And with no jobs on the horizon, they truly have no recourses.  

We should really ask ourselves how far down the free market path we want to go

That said, do we even have a free market?  

Our current system subsidizes corporations for their efforts.  Oil companies receive subsidies even during years of record profits.  GE posts record US profits and not only pays nothing in taxes, but receives a multi-billion dollar refund.  This is known as Corporate Welfare Capitalism in progressive circles.  

Further, we don't have a level playing field for individuals to compete within the market.  Much of our nation's wealth is transfered inter-generationally, with the top 400 individuals currently (2010) owning something like $1.37 Trillion worth of assets (about 2.5% of everything of value in the country), and the bottom 60% of the population, or about 180 Million Americans combined owning LESS than the top 400 (about $1.26 Trillion or 2.3% of all wealth).   (Politifact)  As a matter of fact, the capital base is concentrated to the point of the top 20% of the populous owns 87% of the nation's wealth  and the bottom 25% have negative net worth. (Economic Policy Institute Wealth Distribution press release).  As a side note, the tax benefits for corporations noted above therefore flow directly to this small portion of the population that owns all the assets.

In other words a small minority of the population has a huge advantage over all others in terms of access to opportunity, much of it derived not from their own labors and abilities, but rather through the luck of the draw on who their parents were.  This is similar to other systems we've seen in history - Feudalism, Oligarchies and the like.  And this advantage has been increasing significantly for the past several decades with the richest 1% now having 50% greater wealth than in 1983, and the bottom 60% actually being worse off.  Further, our laws perpetuate this situation through capital gains taxes (less than wages), tax exempt bonds, and inheritance laws.  

Wealth accumulation in the US is intergenerational - with the majority of wealth being transferred through inheritance over time. The fact is that there's something like an 85% plus probability that you are in the same wealth quintile as your grandparents were.  And if things remain the same, there's a similar probability that your grandchildren will be in the same economic lot as you are today. We have the most stagnant populous in terms of income and wealth mobility of any of the 25 OECD countries - we're worse than Great Britain or South Africa.  The privileges of wealth flow to this minority therefore based on parentage rather than merit.  Starting with what pre-natal care you're likely to receive (therefore determining your health and longevity once born), moving on to what schools you go to (determining your education and competitiveness in the marketplace as well as the network you have access to after school), and what society you have access to - all these are determined by who your parents are, not by your innate drive and ability.  Oh, to be sure there are plenty of exceptions to this - there are hundreds of self-made millionaires out there.  You may be one of them, or you may know one.  However, in the law of large numbers, these are anomalies for the greater population.  We can't be basing public policy on these exceptions, and shouldn't be using them to drive our world view.

So, the above tells me that we don't have free capitalism in this country, that we've created a system, and reinforced it with laws and tax codes that perpetuate the agglomeration of capital, and therefore opportunity into an increasingly small segment of the population.  

These observations beg a few questions:

First - is this system somehow wrong?  Do we require a level playing field? Do we care about this intergenerational accumulation of wealth and its implications for our economy and society, or is this what our nation should look like? 

Second, what about the rest of the country?  What does it imply for the 80% of the country that doesn't have the advantages of the wealthy?  What support mechanisms need to be in place (if any?) to create opportunity and some form of security for the bottom 80%?  I

 hear plenty of talk about the sense of entitlement the poor seem to have, what about the real entitlement the rich have?  Somehow I'd think the rich would have learned from the French Terror - that "let them eat cake" would not be the mantra of this class.  It would seem to be in their self interest to at least recognize the issue and address it.

Lastly, what sort of society and government do we want to have?  Should we truly be creating a free capitalistic society, a movement back to Upton Sinclair's world of The Jungle, or should we be focused on creating something different?  A place where we all can succeed if we want to.  Where we have the opportunity to harness the talents and passions of our citizenry.  Where the weak, elderly and infirm have support systems in place to ensure they aren't cast out on the cold hard streets?

These are important issues to discuss and come to a shared point of view for they shape the answers to the next two major considerations - What role should government play in addressing this issue, and how can it be done efficiently and cost effectively.

So, the time I have to write this edition of Random Politics comes to a close.  I know this hasn't been the most cogent of arguments.  I'm sure you disagree with some if not all of what I've written.  That's alright though, for it's in the dialog that we can find commonality of ideas and purpose.  All I ask is that you consider the points I've made.  Rebut them if you like.

In closing, a quote from one of the wisest Americans of all time.  Something to think about as we consider what sort of support systems we want to have for our nation and its people:

"I am for doing good to the poor, but I differ in opinion of the means. I think the best way of doing good to the poor, is not making them easy in poverty, but leading or driving them out of it. In my youth I travelled much, and I observed in different countries, that the more public provisions were made for the poor, the less they provided for themselves, and of course became poorer. And, on the contrary, the less was done for them, the more they did for themselves, and became richer.
Ben Franklin -  On the Price of Corn and Management of the Poor (29 November 1766)


Footnotes
(1)  For those of you footing and ticking I've included Social Security ($738Bn), Medicare ($498Bn), "Income Security" ($567Bn), Health ($381 Bn) and Education / Training (estimated at $142Bn) in this.  The next three categories are Defense (strangely $738Bn the same as Social Security), Everything Else (tons of different programs like DOE etc. at $375Bn) and Interest Expense at $251 Bn).