From a posting at Daily Kos, a concise summary of why up is up, not down:


The author of 23 Things They Don't Tell You About Capitalism, Ha-Joon Chang, writes:

It is increasingly accepted that these policies are not working in the current environment. But less widespread is the recognition that there is also plenty of historical evidence showing that they have never worked. The same happened during the 1982 developing world debt crisis, the 1994 Mexican crisis, the 1997 Asian crisis, the Brazilian and the Russian crises in 1998, and the Argentinian crisis of 2002. All the crisis-stricken countries were forced (usually by the IMF) to cut spending and run budget surpluses, only to see their economies sink deeper into recession. Going back a bit further, the Great Depression also showed that cutting budget deficits too far and too quickly in the middle of a recession only makes things worse.

As for the need to cut social spending to revive growth, there is no historical evidence to support it either. From 1945 to 1990, per capita income in Europe grew considerably faster than in the US, despite its countries having welfare states on average a third larger than that of the US. Even after 1990, when European growth slowed down, countries like Sweden and Finland, with much larger welfare spending, grew faster than the US.

As for the belief that making life easier for the rich through tax cuts and deregulation is good for investment and growth, we need to remind ourselves that this was tried in many countries after 1980, with very poor results. Compared to the previous three decades of higher taxes and stronger regulation, investment (as a proportion of GDP) and economic growth fell in those countries. Also, the world economy in the 19th century grew much more slowly than in the high-tax, high-regulation era of 1945-80, despite the fact that taxes were much lower (most countries didn't even have income tax) and regulation thinner on the ground.

The argument on hiring and firing is also not grounded in historical evidence. Unemployment rates in the major capitalist economies were between 0% (some years in Switzerland) and 4% from 1945-80, despite increasing labour market regulation. There were more jobless people during the 19th century, when there was effectively no regulation on hiring and firing.

So, if the whole history of capitalism, and not just the experiences of the last few years, shows that the supposed remedies for today's economic crisis are not going to work, what are our political and economic leaders doing? Perhaps they are insane – if we follow Albert Einstein's definition of insanity as "doing the same thing over and over again and expecting different results". But the more likely explanation is that, by pushing these policies against all evidence, our leaders are really telling us that they want to preserve – or even intensify, in areas like welfare policy – the economic system that has served them so well in the past three decades.

For the rest of us, the time has come to choose whether we go along with that agenda or make these leaders change course.

Blink!

Blink! Where'd 2011 go?

Pharo Christmas 2010

What To Think About The Midterms

2010 Midterms

A somewhat larger than usual mid-term adjustment. That will be the conventional wisdom.

In 2008, the conventional wisdom was “paradigm shift,,” “transformative,” etc. In hindsight, the conventional wisdom seems to have missed the mark – widely.

What to think about 2010? First, I suspect that a year from now, the President will be under siege from the various investigations and impeachment hearings that will be launched in the House. The repeal of DADT will be a bitter pipe-dream. The government will be forced to cease any number of critical services, from food inspection to financial regulation. Veterans will be under attack from the government they were once part of. Cap-and-trade will be the Topic That Must Not Be Named, Let Alone Discussed.

Pretty much partisan politics as usual.

Two things worry me the most. The first is that the Dems continue to struggle with leadership. They are focused on good policy (which is why I like them), but they do not believe that leading the people is part of their job. They are tragically wrong. The GOP understands that many voters want someone who seems certain, even passionate, about their beliefs. They further understand that all the passion in the world won’t matter unless a voter feels it, so they shout and bang the table and make outlandish accusations, etc., all of which is loud enough to get through to persuadable voters.

The Dems sound like a round-table discussion on NPR. Their passion is no doubt real, but that authenticity lulls them into thinking that they just need to be themselves for voters to understand how committed they are.

False. Too many voters’ take-away from the Dems is “politics as usual,” a certain sense of entitlement, and a lack of commitment to what matters most.

There’s no doubt that the Dems suffer from a kind of patronizing attitude, and that this attitude is extremely off-putting. Dems also don’t understand the basics of mass communication, often choosing worthy candidates in terms of their positions, work ethic, etc., but who are not telegenic or likable. Nor do they understand basic negotiating techniques, like starting with a position more extreme than what they would ultimately accept. The GOP uses their base for this purpose very effectively, while the Dems seem ashamed of their base. The Dems will need to address these concerns before they can expect a wide embrace of their platform.

Besides the continuing failure of the Dems to understand the need to be seen as fighters, the other concern coming out of 2010 is the impact of corporate cash. For Karl Rove & Co., this was a warm-up. And the experiment is continuing – to qualify for their tax-free status, more than half their funds are supposed to be spent on non-electoral activity, which means they are planning a big ad blitz in the coming months to overturn health care reform and financial regulation. In terms of 2012, Rove will have a compelling argument that investing with him will return good dividends, and I’d be surprised if the GOP didn’t have more or less unlimited money in 2012.

We are on the verge of a new, corporate era of politics. The rules for 2012 will be different. And the corporate interests now believe (correctly) that their ability to spend will bring them subservient pols.

My guess is that the GOP will increase their edge in the House, take the Senate, and almost get the White House in 2012, provided they are running against Obama. If he has been forced from office (or, God forbid, worse), the GOP will likely have no trouble with either Biden or whoever the Dems end up fielding.

It is always disturbing to see otherwise sensible people falling for the Big Con that is today’s GOP. I don’t see any reason to think this basic dynamic is going to be changing any time soon. The march of the United States of America towards third world status will continue with renewed vigor. And the shame is those most responsible will be cheered as deficit-cutting, tax-cutting heroes, and not as simply sadistic bastards, which is what far too many of them really are.

Lincoln Saw It

Future President Abraham Lincoln in his famous 1858 speech at the Cooper Union articulated the problem he saw of dealing with the slave-owning interests, who could not stop accusing him and his party of undermining their rights to own slaves, notwithstanding a complete lack of evidence:

The question recurs, what will satisfy them? Simply this: We must not only let them alone, but we must somehow, convince them that we do let them alone. This, we know by experience, is no easy task. We have been so trying to convince them from the very beginning of our organization, but with no success. In all our platforms and speeches we have constantly protested our purpose to let them alone; but this has had no tendency to convince them. Alike unavailing to convince them, is the fact that they have never detected a man of us in any attempt to disturb them.

This applies today with the same force to so-called conservatives, who constantly complain of government spending and the need for "limited government." They cannot stop damning Democrats, who they falsely accuse of radicalism. Future President Lincoln saw through this non-sense as well:

But you say you are conservative - eminently conservative - while we are revolutionary, destructive, or something of the sort. What is conservatism? Is it not adherence to the old and tried, against the new and untried? We stick to, contend for, the identical old policy on the point in controversy which was adopted by "our fathers who framed the Government under which we live;" while you with one accord reject, and scout, and spit upon that old policy, and insist upon substituting something new. True, you disagree among yourselves as to what that substitute shall be. You are divided on new propositions and plans, but you are unanimous in rejecting and denouncing the old policy of the fathers. Some of you are for reviving the foreign slave trade; some for a Congressional Slave-Code for the Territories; some for Congress forbidding the Territories to prohibit Slavery within their limits; some for maintaining Slavery in the Territories through the judiciary; some for the "gur-reat pur-rinciple" that "if one man would enslave another, no third man should object," fantastically called "Popular Sovereignty;" but never a man among you is in favor of federal prohibition of slavery in federal territories, according to the practice of "our fathers who framed the Government under which we live." Not one of all your various plans can show a precedent or an advocate in the century within which our Government originated. Consider, then, whether your claim of conservatism for yourselves, and your charge or destructiveness against us, are based on the most clear and stable foundations.

As usual, the so-called Conservatives suffer from a mental tic that makes them accuse others of their own sins. Future President Lincoln had a final word for those who claimed that the issue was raging across the land, and that such raging was evidence of the wrongheadedness of Lincoln's claim that he only wanted to preserve the status quo -- the very essence of the word "conservativism:"

Again, you say we have made the slavery question more prominent than it formerly was. We deny it. We admit that it is more prominent, but we deny that we made it so. It was not we, but you, who discarded the old policy of the fathers. We resisted, and still resist, your innovation; and thence comes the greater prominence of the question. Would you have that question reduced to its former proportions? Go back to that old policy. What has been will be again, under the same conditions. If you would have the peace of the old times, readopt the precepts and policy of the old times.

Everything old is new again, except of course that history never repeats itself exactly the same way twice. And many Americans think we are simply going through the usual partisan back and forth. I submit that the half-century long failure of the left to develop and execute a push-back strategy is no more small thing, and that their timidity and inaction has already opened the door to destructive forces they are now powerless to pacify absent a great cataclysm.

"If the next year is going to bring exceptional growth," [UCLA Anderson Forecast director Edward] Leamer writes, "consumers will need to express their optimism in the way that really counts — buying homes and cars. And that is not going to happen if businesses continue to express their pessimism in the way that really counts — by not hiring workers."

The result is an economic Catch-22.

That, in a nutshell, is the scenario that I believe has been slowly unfolding for some time. The thing that people don't seem to realize is that the Catch-22 is not neutral, i.e., it doesn't represent treading water. It is downward. You can reverse the polarity and get the same result: if businesses keep laying people off, people won't have money to spend, so businesses will turn to lay-offs.

Corporation have relied on job-destruction to cover-up a decades long failure to innovate and create the future. Throwing almost all our R&D money into war research for the last 70 years hasn't helped either.

This only ends when the government opens employment offices in every city and gives everyone who wants one a job that puts a roof over their heads and 3 squares a day. The armed forces isn't nearly enough to do it, at least in the absence of an actual conflagration, which is looking more and more likely by the day.

On the upside, the Mets swept a road series.

The Long War

In the press of daily business, it’s easy to forget that the big picture matters more. (Yogi: “In the long run, we’ll all be dead.”) But in the long run, the most powerful social forces will have their way. (“The arc of history is long, but bends towards freedom:” MLK Jr.)

I don’t mean “Long War” in stupid sense favored by Bush-ites: a turd-polisher to cover the inanity of America’s never-ending wars. I mean it in the sense of the long war to obtain social justice. (WARNING: GLENN BECK DISAPPROVES! A LOT! “SOCIAL JUSTICE CODE FOR …SOCIAL JUSTICE! HOW EVIL!)

If you want to know what the future of our society is, take a look way back into history. Many of our social conventions – the role of “women” in society (in quotes because most of the claptrap about “women” is about rich white women), the sudden reverence of blasto-cyst Americans (anti-abortion), the “problem” of unemployment, etc. – are modern constructs. Early humans struggling to survive didn’t have much of a concern for “creating jobs.”

Many of our current social problems are traceable to the rise of modern conservatism. The key idea of that movement is not only that private enterprise is the only legitimate social structure, but that the government is the enemy of private enterprise and therefore legitimate social order. Government is bad because it re-distributes money from the wealthy to everybody else, both directly by taxation and indirectly by making it harder to become rich (for example, by outlawing child labor or limiting pollution). In fact, it’s the government-hatred that really defines modern conservatism, as veneration of the wealthy can occur without it (think “Lifestyles of the Rich & Famous,” or People Magazine).

Failing schools. Failure to invest in R&D. Corporatism run amok. Lack of health care. Global warming. World poverty. Lack of water. The list of our ills goes on and on, and in most cases, can be traced back to a lack of adequate government action/investment by those who have the resources. (It’s a phenomenon that I’ve been thinking of “passionate devotion to wrong ideas.”) A strong government, especially a democratic government, is the best hope that non-wealthy people have to fight the rich and powerful.

The President is in the news today because he is thinking of tackling the Israel-Palestinian crisis directly. (Would that problem be so intractable if wealthy Arabs contributed to the Palestinians’ relief at something like adequate levels?) And here’s the “Long War” part: the Middle East situation is (obviously) not sustainable. A hundred years from now – or two hundred, or a thousand – the fights of today will be forgotten and a new set of issues will be thought to be important. Some kind of settlement – equilibrium – will be reached, the only question is how, when, and what kind. (The future’s coming – no way to stop it!) Will a nuclear bomb obliterating Tel Avis kick off a conflagration that will consume millions of lives for years and years? Will a popular revolution in Iran lead to a new Middle East leader who lays the groundwork for a cooperative diplomatic union that ushers in an era of peace? Will the Americans and Europeans force their clients to accept a deal that the clients themselves eventually come to see as the end of their enmity? Of course, the one thing I can say for sure is that factors that we currently aren’t considering or seeing (“known unknowns” – D. Rumsfeld) will play a major role in events, but that in the long-run, the unsustainable will not, in fact, be sustained.

The rich exploit the poor, the powerful the weak. It’s been true forever, and ain’t going to change any time soon. However. However…there’s a certain back-and-forth, and over the long haul, the poor and the weak are doing better and better. The long arc of history favors the just, no doubt. The question for our public policy makers is what are the best ways forward. Should we let Iran be bombed by Israel? Should the government raise tax rates? Should the US government pledge to re-build Haiti? The actual outcomes of many of today’s important debates is a foregone conclusion. Over the long-haul, the poor will be raised up (a bit), the greatest injustices will be adjusted, etc. But getting there can be hard or easy, take forever or just a week, be destructive or constructive – in short, the means are how we will be judged. We All Know(sm) what the ends are.

Not Worried? Read This

Despite flat denials earlier this month, the RNC's Young Eagles will be holding an April fundraiser at the headquarters of Blackwater in Moyock, North Carolina.

GOP + Blackwater = Not good, not good at all.

HCR Summit

OK, apparently none of you know What To Think(tm) about the health care summit, so I will tell you.

You're welcome.

1. The biggest breakthrough was to bring Republican opposition down to earth. Any notion that the Democratic approach is illegitimate, un-Patriotic, etc., was absent, and the lingering effects of this event will make it just a bit harder fro the GOP to continue down that path. The President ("I like calling you that") made them sit up and behave, and made them spit out their stupid ideas in a way that they couldn't be ignored.

2. This was the next step in creating the fissure that will ultimately sever the crazy out of the GOP. For some of those GOPers, like Coburn, for example, there was simply too much temptation to participate in the substance, which means one cannot pretend that the entire undertaking is bogus. See #1.

3. The President modelled how to both confront these guys and stay civil. Several Dems were already pretty solid on this (Clyburn comes first to mind), but many of them got a chance to show that they too could act like grown-ups.

4. It would be pretty hard for any fair-minded viewer of the event to conclude that the GOP was serious in its thinking, or that the Dems hadn't thought pretty hard about their proposal.

5. This event, together with the one in Baltimore, will be remembered for being a sort of watershed for both the Dems and the GOP.

6. Importantly, the GOP was without one its main tactics: shouting down those who would show you to be a liar. The President felt comfortable speaking over fairly vociferous GOPers when he felt that had gone too far. I think this will give a lot of other Dems the courage to do the same, with the effect that their voices won't be drowned out so easily or so often.

7. The event ensures the passage of HCR, and for that matter much else.

8. By staking everything on their nutty worldview, the GOP bet the farm and lost. If they cannot persuade enough voters that government action inherently wrong, they've got nothin.

9. Anyone watching the event would have to conclude that a fair portion of the GOP's senior-most leaders are venal and not bright.

10. Speaking of not bright, how 'bout that Chris Matthews? Even next to dim-witted Chuck Todd he STILL seems dumb.

That is all.

This is the Problem.

This is why we're not just going to head out of the woods and be OK. So many years of job losses, in a society already weak in the nest-egg department, is going to have consequences.

Freddie Mac reported that the rate of serious delinquencies - at least 90 days behind - for conventional loans in its single-family guarantee business increased to 4.03% in January 2010, up from 3.87% in December - and up from 1.98% in January 2009.

There's another major wave of economic decline heading our way, although none of our leaders appear ready to acknowledge what is fairly obvious.

The Tide is Turning

The under-appreciated Steve Benen notes that the fissures separating the crazy-right from mainstream politics are leading to isolation:

The remarks were a further reminder of the isolated nature of the Cheney wing -- the dominant wing -- of the Republican Party. The Obama administration's positions are enjoying the support of Powell, Gen. Petraeus, Adm. Mullen, the Pentagon, and national security experts from across the spectrum.

A lot of people on the left are despairing that Dems seem so weak, the right seems to own the media narrative, and we are all hopelessly doomed. And if this particular movie were to roll credits right now, it would surely be so. But this ain't the last reel in the film...

David Axelrod noted to a reporter after a big victory that "you guys" -- meaning his former profession of political reporter -- are always looking backward. You're sitting in the back of the pick-up looking at where we've been. Those who are actually driving the truck -- the candidate and his team -- are looking forward, always forward.

From where I sit, the trivialization of the crazy-right, long thought to be absolutely inevitable, is well and truly underway (apologies to John Cleese). An important step in the process is to have a series of issues that they embrace, but are not embraced by those in the mainstream.

Here comes Colin Powell. (In my mind, he is a sad and mostly pathetic creature, but is a card-carrying member of the mainstream elite.) He says that the claim that the Obama administration is making us less safe is not his view. He comes as close as any card-carrier ever will to saying the claim is nuts.

The idea that we need to start over on health care, or that it is a government take-over, is likewise finding less and less traction in the mainstream. Some sort of health care financing reform seems both desirable and inevitable. So, HCR is another brick in the wall.

The idea that the stimulus was a pork-barrel wasteland that did nothing for the economy is likewise now firmly rejected. I/m sure you can come up with more examples.

The point of all of this is that the steps necessary to dismiss these nuts for a good long time are now being taken. Looking forward, Axelrod-like, it seems clear that the President will pass some sort of HCR, and that some group of non-crazies Republicans will join him. If not, that will lead to the demise of these GOPers. HCR is the thin edge of the knife: those that want to be part of relevant politics in the next half decade or more will have to find a way to appear to be on the side of HCR, while those who go down fighting it will, well, just go down -- to oblivion.

Dems seem unable to imagine a future in which they win. I think the President sees it, and that's why he's not projecting defeatism.

It seems to me the future will be the result of a new wave of pols on the left and right. On the right, lack of sociopathy will become the norm, once again, and restraint, caution, reluctance to accept change, etc., will return as the positive forces society needs. On the left, defeatism and fear will be shown the door, and the new pols will embrace the electorate's growing appetite for change.

Right now, Obama is the leader of BOTH groups. At one point, he may end up on one side or the other. (I'd guess he'd be a more center-right than center-left.) The President is trying to preserve a space for non-insane GOPers, and is also trying to buck up those of his party-members who would really rather just quit.

Is is written in stone that Obama can't yet succeed? Aren't there enough sentient voters left that will reject the crazy and embrace meaningful change? My guess is that the electorate is ahead of the old-school pols and that a majority is way past ready for change - real change, and that they will end up getting it, at long last.

That concludes today's screed.

Here's Someone Who "Gets It"

Here's an excerpt of a long-ish piece by one L. Randall Wray that finally gets to the heart of my idea about jobs - that the private sector's failure to meet society's needs for employment is not fix-able via half-measures like modest tax incentives:

But what I am advocating is something both broader and permanent: a universal jobs program available through the thick and thin of the business cycle. The federal government would ensure a job offer to anyone ready and willing to work, at the established program compensation level, including wages and benefits package. To make matters simple, the program wage could be set at the current minimum wage level, and then adjusted periodically as the minimum wage is raised. The usual benefits would be provided, including vacation and sick leave, and contributions to Social Security.

Note that the program compensation package would set the minimum standard that other (private and public) employers would have to meet. In this way, public policy would effectively establish the basic wage and benefits permitted in our nation--with benefits enhanced as our capacity to provide them increases. I do not imagine that determining the level of compensation will be easy; however, a public debate that brings into the open matters concerning the minimum living standard our nation should provide to its workers is not only necessary but also would be healthy.

Once our friends on the right (and frankly many on the left!) get over their revulsion at the idea that the government can act directly in the market as a market participant, this is the only way to go. The only question is how much damage will we cause ourselves before we finally take the only step that will work?

Jobs!

There's hardly a TV talking head or Congress-critter or administration representative who can talk about anything other than JOBS. J-O-B-S! It's as though the crying need for jobs just arose (it has been around for 20 or more years). It's also talked about as though it were a virus that needed a cure -- 'if only the Congress would FOCUS on job creation," or "This year, the Administration's #1 priority is JOBS." Yet another triumph of American obfuscation. The problem is simply a lack of will, a lack of focus, a lack of the 'right idea.' Solutions, people. Solutions.

But of course the truth is far from this preposterous framing. The idea that businesses are not hiring because they lack a tax break is ludicrous. The idea that small businesses aren't thriving due to lack of credit is not borne out by any actual data. However, there's a mountain of data suggesting that the great wealth accumulations in our society are not producing any socially useful result.

The nation's rich and powerful have succeeded so well in convincing their fellow countrymen that their success is warranted that it is now a bed-rock principal of American social thought. Poor people deserve their fate, as do the young, the sick, and most especially the incarcerated. And young Mr. Trump deserves those millions because he has so very cleverly wrung them out of the American economy.

My experience in American business since 1980 or so has shown me that leaders who create shareholder value by simply taking it from those least able to protest -- employees, suppliers, customers. I have not seen American leaders in any great numbers succeed by innovation, commitment to excellence, developing new ideas, new markets. In short, American business leaders succeed by cutting jobs, not by creating them. Of course there are notable exceptions, but the overall drift is clear.

Consider the political orthodoxy that taxing things makes people do them less. This has been twisted by our elite to mean that all taxes mean less economic growth. Even Democrats lack the courage to denounce this nonsense for what it is. But where does the government get most of its money? From the press, one might think it's from beleaguered "small businesses," or from the sweat of our "entrepreneurs." But that's simply false. The vast majority of the government's revenue is from wage withholding -- in other words, job taxes. We have heaped so much of the government's need for money onto wage-earners, no one should be surprised that jobs are in short supply.

I have an idea. Let's tax wealth in excess of say, two generation's worth of expenses, and use those proceeds to eliminate payroll taxes. Let's also tax income in excess of, say, $500,000 per year and use the money to pay for healthcare -- and I mean to include corporations in that. Why shouldn't large business enterprises pay a significant portion of their income as tax? The idea that large businesses need special protection to form and to succeed is borne out by no actual evidence, and there's a fair amount of evidence to the contrary.

And finally, we have tried every trick in the book to get the private sector to create adequate levels of employment, so far with dismal results. I have said this many times over the last several years, but we will not exit this jobs crisis that began so many years ago until the government takes direct action in the labor market. Think Harry Hopkins hiring millions of new government workers in 1934, or government contractors and the military scrounging for every able-bodied adult in 1941. That is the kind of thing that will work. And to be an ongoing solution, those hires have to transition to something that is sustainable, such as alternative energy, healthier food production, improved community services, etc.

It's a hard enough challenge when one wants to do it. But when the entire power elite has for many years preached the gospel that we can do anything EXCEPT the one thing that would work, it's impossible. Unless and until we as a society start to embrace the kind of things that will actually work, we will continue to sputter along, failing a little bit more every day.

That concludes today's screed.

And Another Thing

I've said before on this blog that I think the underlying economic crisis is far more serious than the "financial" crisis. Long-term economic woes can persist for some time without causing any kind of crisis -- an occasion for noticing and hopefully dealing with the underlying woes. The recent financial crisis -- itself a sort of underlying woe triggered into crisis by the catalyst of the collapse of the housing market -- will be seen down the line as a catalyst of a larger economic crisis.

I have written previously that:

Another undesirable consequence of Wall St.'s demands is that it starves society of research and development.... [A] lot of companies don't have any R&D strategy, so they riff on the products they already have, they move those products into new markets, and they buy-out the competition. Plus, there's always moving work to lower-cost markets and otherwise depriving workers and suppliers of any available pennies in order to make the firm look like it's growing.

This all points to a serious crisis in the world's economy. We have faced and rebounded somewhat from last year's financial crisis. But we have yet to face and rebound from the underlying economic crisis that continues to worsen. I believe that the current downturn shares this feature with the Great Depression.

We exited the Great Depression by providing work to every man and woman we could get our hands on. We came out of the war with enough technological innovation to support a couple of decades worth of improving products and services.

I don't see any such deus ex machina on the horizon, and so don't see any basis to suppose that the long-term decline in our standard of living is going to be reversed any time soon.

While many companies are in fact engines of growth and innovation, it's hard to conclude that the large majority are. We are living at the beginning of a long period of slow-decline -- not entirely a bad thing, to the extent it allows others to climb out of terrible poverty -- and sadly, most Americans are completely unaware of what's been done to them for the last 40 years.

Should any political party attempt to abolish social security, unemployment insurance, and eliminate labor laws and farm programs, you would not hear of that party again in our political history. There is a tiny splinter group, of course, that believes you can do these things. Among them are H. L. Hunt (you possibly know his background), a few other Texas oil millionaires, and an occasional politician or business man from other areas. Their number is negligible and they are stupid.

- President Eisenhower

I believe this will soon be the majority view of the current rump of the GOP. However, it will be wrong. This splinter group is a bomb waiting to go off. They are but one or two lucky breaks away from a serious threat to American society. Still, it's intereresting that DDE not only thought this, but articulated it so plainly.

Health Care Reform

It's been a while, and I thought it was high time to explain What To Think (tm) about the impending health care reform.

First things first. The bill as written is a mess. It's a product of a legislative process that both lacks leadership and has a large faction devoted to promoting ignorance and fear. Here's what's troubling about the bill:

1. No minimum level of coverage. The mandate's analogy to auto insurance is compelling to many people, but there's a huge difference: GEICO and State Farm can compete on price because they cannot compete on coverage. The basic coverage required by state law can be improved, but it's a floor that's also an adequate level of coverage. If a consumer takes only the minimum coverage, they'll be OK in the event of a claim. This omission is largely absent from the current debate -- and it's the #1 thing that makes the bill unlikely to improve anyone's health care coverage.

2. No Pre-existing Condition Exclusion. The health insurance lobby got rid of the "no pre-existing condition" language and have re-instated it as a basis for excluding coverage. Again, this received no coverage, but it's a problem.

3. The "subsidies" are a joke. They do not take into account anything like affordability. It assumes that $90,000 has the same value in Los Angeles as it does in Terre Haute, when it obviously does not. A family in NYC that makes $100,000 and pays $3200 a month in housing expense will be required to pay $15,000 a year or else face a fine of about half that (meaning they pay half and get nothing, coverage-wise). This is ridiculous.

4. It preserves the status quo for half a decade. The bill's provisions won't take effect until 2014. That's more than enough time for the moneyed interests to undo the beneficial effects of the bill.

5. Cost-Containment Is Absent. There's a lot of pilot programs to test various kinds of cost-reduction strategies, but there's no guarantee that even successful programs will ever be rolled out more broadly. Cutting the cost of health care in the US isn't a mystery that has flummoxed the nation's brightest minds for years. It's a goal that it antithetical to the interests of those with access to power.

6. It further codifies the Right's misogyny. Telling poor and middle class women that abortions are not for them is simply wrong. I can't imagine greater hypocrisy than saying abortions are OK only for those that can afford them. This is supposed to be principled? Complaining that you don't want your (federal) tax dollars going to support abortions is like me complaining that I don't want to have my (federal) tax dollars spent on killing innocent Yemeni women and children.

7. Public Option? Yeah. Um, just yeah. This was never going to be the panacea we all hoped it would be. At best, it was something that could grow into something useful, but that wouldn't happen for sometime. And in the meantime, we can come back to this, though I doubt we will. The sad truth is that in the class was in the US, the outcome is clear: the rich have won, and they will never accept quality healthcare for all. Being mean to our poor and weak is the hallmark of our society, and that's not going to change any time soon.

I could go on, but that covers it. There are some reasons to support the bill.

1. It goes far beyond what any Presidential aspirant proposed as recently as 2004. Compared to previous health care reform measures, this is significant. Remember it wasn't much more than a year ago that the President (Bush) vetoed a modest expansion in S-CHIP coverage for children. This bill undoes that veto and then some.

2. It signals to the health finance industry a cultural shift toward reform and meaningful cost control. This is the value of thought leadership. For tens or even hundreds of thousands of people who work in healthcare and its related financial industry, this bill will be an inspiration to consider new approaches, to take on things that were previously thought to be sacred cows, etc.

3. It makes Republicans mad. This is the best reason of all. And apart from the sport of seeing the likes of Jim DeMint and "Doc" Coburn fuming mad, this bill is only possible because of the GOP apporach. Their boycott of the process has meant that there are no "middle ground" bills to attract the weak minded Maine Senators and their ilk. For Dems, it's the Senate bill or nothing -- a choice that's bringing us the Nelsons and the Landrieaus.

Add it all up and I'd vote for it. A half loaf is on offer -- take it! I doubt there will be many benefits from it, but even a few benefits are worth it, and who knows, maybe when the electorate gets a load of their money being shovelled to United Healthcare, they might actually want real coverage. It's not likely, but it could happen! Ponies!

Lousy Air Travel The Least of Our Worries

Kevin Drum riffs on an Atrios comment that "flying really sucks." Kevin says:

If I can put on my Andy Rooney hat for a moment, doesn't it seem as if this describes most of American business these days? It's not just the airlines. As near as I can tell, consumer-facing businesses these days virtually never think about how they can make things genuinely more convenient for people. Rather, they seem almost obsessively concerned with calculating the maximum amount of pain people will put up with before they finally get pissed off enough to take their business elsewhere.

I think Kevin's on to something significant.

I heard a restaurant evaluator a few years ago talking about restaurants, and he always favored local institutions, whatever it was, from a great Northern Italian to a clam shack at the beach. He described food at big chain restaurants as "just good enough so that you won't swear never to return and mean it." He pointed out that there's no one for whom Olive Garden is the best restaurant, just the most convenient, easiest to park at, and not so bad that one would never return.

A lot of large businesses are run this way: gouge every penny possible from the consumer to the point where you are one cent shy of losing the customer. And, after all, it's a smart way to maximize near term profits.

Smaller businesses that don't have to face the demands of the stock market have freedom to charge what they like, and provide whatever level of service/quality they like.

The problem is that the larger businesses essentially rig the game by using their size -- and ready (ish) access to capital to preclude smaller businesses. That's why nearly every town in the US has the same stores, restaurants, etc.

Another undesirable consequence of Wall St.'s demands is that it starves society of research and development. Air travel benefits in part from the R&D that is done by the government. But a lot of companies don't have any R&D strategy, so they riff on the products they already have, they move those products into new markets, and they buy-out the competition. Plus, there's always moving work to lower-cost markets and otherwise depriving workers and suppliers of any available pennies in order to make the firm look like it's growing.

This all points to a serious crisis in the world's economy. We have faced and rebounded somewhat from last year's financial crisis. But we have yet to face and rebound from the underlying economic crisis that continues to worsen. I believe that the current downturn shares this feature with the Great Depression.

We exited the Great Depression by providing work to every man and woman we could get our hands on. We came out of the war with enough technological innovation to support a couple of decades worth of improving products and services.

I don't see any such deus ex machina on the horizon, and so don't see any basis to suppose that the long-term decline in our standard of living is going to be reversed any time soon.

It's certainly true that some of the decline of the West is the happy by-product of a sort of global equalization which is having the positive effect of lifting hundreds of millions out of abject poverty. But we are also dealing with the consequences of a poorly managed society for the last 40 years or so. (Hardly surprising when one considers that we've had a faction in our society for that period that seems to seek and celebrate poor or non-existent social management).

The Future

The Dems will win on health insurance reform, and over the next 25 years will argue with the Republicans over various important improvements (which the Repubs will denounce as "expansion of government power" and "employing more and more bureaucrats" or some such).

In the medium- to-long term, say 25 or so years out, the Democrats will in fact have come to take their rule for granted. They will propose foolish ideas and will be taken down over the ensuing 15-25 years, when the latest iteration of the conservative movement again captures political power.

Rinse. Repeat.

I'm inexplicably upbeat and positive about tonight's BHO speech. I saw a few minutes of his Cincinnati speech, and had the experience of thinking I was re-connecting with an old, dear friend after a summer apart. Weird, yeah.

Yup.

Any hoo, I'm sure I'll find more than adequate grounds for pessimism and gloom shortly. Do not be alarmed!

A sustainable answer to the cruel logic of exponential math

Simply a Deep Thought(tm):

Humans had, for most of our development, millions, thousands, hundreds and even tens of years to adjust to the new problems of our growing species. How best to protect the tribe from animals? How best to store grains? How best to protect our group from other groups who would attack us? How to attack other groups and get their stuff? All of these questions have been addressed with the luxury of some considerable time -- and in a time when significant loss of life was not all that rare.

In the last 200 years, though, our growth has risen to insanely high levels. (Strangely, most population growth experts expect it to top out at some point fairly soon, though why that should be so I have no idea.) We have had to invent, nearly on the fly, systems to handle our basic human needs. We have often done so while incurring large loss of life, and I'm not even counting warfare and genocide - simple death from starvation has been an ongoing catastrophe of enormous proportions.

When I consider the state of our American experiment, I am concerned that we do not have a sustainable model. We still follow an extractive model, and routinely waste enormous resources, lost in our obsession with free markets and social Darwinism.

Social Darwinism is not who we are as creatures. We are hard-wired to be more community-minded, and are obviously striving to get more and more community minded all the time. But we have a hard time imagining a better future, and remain fixed on the structures that have "worked" in the past.

Our society, like so many others around the world, has a jobs/work crisis. Humans need to feel productive to remain happy, and far too many are not producing at anything like their potential. The value of specialization, the value of economies of scale, the power of technological acheivements - these are all forces that free humans from various kinds of work. But we have operated under the impression that the goal is a society where no one has to work, which has sadly led us to a society where not enough people have useful work to do.

In considering the best ways to create work/jobs, we must start to value more highly the need of humans to have meaningful work. Even if it means we "pay" more. We might pay teachers more, even though we might not "have" to. We might "pay" to have more manufacturing work done nearby, even though we could "pay" less for it to be done elsewhere.

I've been trying to formulate a model that would be universal enough to be adopted by almost any society. My thought begins with something like, "for every 2,200 humans, we need one dentist, for every 100,000 humans we need 1,400 farm workers, for every 28,500 humans we need 100 carpenters," and so on. The idea is to have communities that are optimally sized and ensure a wide variety of vocations. A single social unit of say, 300 million, is simply too large to manage. My current thought is to establish something rather like colleges and universities, but these institutions would have missions that do not revolve around education (though some could and would), but would have some focus or speciality. I can imagine a transportation college, where engineers would design forms of transportation and workers could produce it; the rest of the community would work to support that. It's not something I've finished thinking through, so there are a lot of issues. But the core of the idea is to create communities of sizes that would more readily allow adaptation, change and growth over time, so that we wouldn't have to work solely on systems that worked for communities of a half a billion souls or more.

If we don't grab hold of our own destiny, the cruel logic of math will leave us with a single system for all 20 billion of us, in which errors are far more costly, innovation is therefore harder, and far too many will fail to lead the kind of productive and satisfying lives that they could if we only built smarter structures and systems.

Max Blumenthal Is Big

Max Blumenthal is on Democracy Now! promoting his new book, Republican Gamorrah.

This is a major voice already. His willingness to show the hard-right on camera as they really is by itself a major contribution both to our current discourse as well as to later historical analysis.

This new book takes the already highly-insightful thinking of Richard Hofstadter's in his Paranoid Style and American Politics one step further. He takes the paranoid mind-set that describes so well the Right's perspective, and links that mind-set to what I've always believed was at the heart of their movement: a (sometimes all too accurate) perception by its members that they have failed by the standards they subscribe to.

Blumenthal quotes the amateur philosopher (OK, that's just fun to type) Eric Hoffer to Explain Everything:

“Faith in a holy cause,” Hoffer wrote, “is to a considerable extent a substitute for the lost faith in ourselves.”

This thought becomes Blumenthal's thesis (likely more of a theme, but hey, it's not a literary society), and is used over and over to illuminate the workings of the current Right at their very most fundamental level. He also introduces readers to some of the charlatans and lunatics who have personally created and led this movement - the actual Right Wing Conspiracy.

Max and I disagree about Obama's read of this history -- he thinks the President doesn't take it on board adequately, I disagree. My own view is that the President is taking a long-ish view, and knows that a success on health care will be the crack in the dam that brings about the destruction of the Lunatic Fringe as a significant force in American society for many years to come.

That destruction will take some time, and the health care win will be but the first big breakthrough. But once Americans come to understand that the government can be a very good solution to many problems, the current RIght will finally have their "emperor has no clothes" moment. We will then be able to enjoy another 40-50 years without their interference.

The Guns of August: How the Republican Right Fired on Health Care

I think the President understands something that Professor Reich and many others do not: victory goes to the side that understands the power of the counter-attack.



The right has had months to mount their opposition, and have come up with things that we can all accept (like "no death panels"), or things that make no sense ("we don't need health care reform).



When Obama returns to the offensive, he will be able attack a fixed target. I predict he will prevail, and all those who wondered why he "let the narrative get away from him" will have to concede that in the end, we got meaningful health care reform.
Read the Article at HuffingtonPost

The Public Option? It's About Accountability

Why don't Dems talk about the need to have non-public ownership of an insurance option? Not too long ago, plenty of insurance companies and banks were owned by their insureds/d­epositors. The vice is the need to post year-over-year profit increases, as demanded (probably justifiably) by the public markets...



I think a lot of older Americans would recall "mutuals" with some fondness. Well that they should, too!
Read the Article at HuffingtonPost

"I Hate Big Government"

Don't know where this is from, or who wrote it. I found it on Americablog.com.

This morning I was awoken by my alarm clock powered by electricity generated by the public power monopoly regulated by the U.S. Department of Energy.

I then took a shower in the clean water provided by a municipal water utility.

After that, I turned on the TV to one of the FCC-regulated channels to see what the National Weather Service of the National Oceanographic and Atmospheric Administration determined the weather was going to be like, using satellites designed, built, and launched by the National Aeronautics and Space Administration.

I watched this while eating my breakfast of U.S. Department of Agriculture-inspected food and taking the drugs which have been determined as safe by the U.S. Food and Drug Administration.

At the appropriate time, as regulated by the U.S. Congress and kept accurate by the National Institute of Standards and Technology and the U.S. Naval Observatory, I get into my National Highway Traffic Safety Administration-approved automobile and set out to work on the roads build by the local, state, and federal Departments of Transportation, possibly stopping to purchase additional fuel of a quality level determined by the Environmental Protection Agency, using legal tender issued by the Federal Reserve Bank.

On the way out the door I deposit any mail I have to be sent out via the U.S. Postal Service and drop the kids off at the public school.

After spending another day not being maimed or killed at work thanks to the workplace regulations imposed by the Department of Labor and the Occupational Safety and Health administration, enjoying another two meals which again do not kill me because of the USDA, I drive my NHTSA car back home on the DOT roads, to my house which has not burned down in my absence because of the state and local building codes and Fire Marshal's inspection, and which has not been plundered of all its valuables thanks to the local police department.

And then I log on to the internet -- which was developed by the Defense Advanced Research Projects Administration -- and post on Freerepublic.com and Fox News forums about how SOCIALISM in medicine is BAD because the government can't do anything right.

Quad. Erat. Demonstratum. The government is NOT incapable of doing anything (with the possible exception of bombing people on the other side of the world).

The Face of Joblessness

This photo is so full of longing, dispair, defeat, desparation.

I suggest looking at it full-size.

Once again our society faces an employment crisis, and we seem to have no better way out than these folks did 70+ years ago.

I'm not certain I see a viable way forward at this point. We need literally millions and millions of jobs. Our leadership seems bereft of any idea of how to do that. (Me? I got plenty of ideas...)

Ten years after this was taken, these girls were women, maybe having lost someone dear in the war. They stood, however, at the start of a new age of economic opportunity. I hope today's 8, 10 and 14 year-olds stand someplace similar in 2119...

I think this sums it up

Had to get much clearer than the great Tom Toles:

We Are Pissing Away our Assets

This photo-essay is something that has really stuck with me. Detroit is experiencing in a couple of decades what Philadelphia experienced over a century.

I am posting it here so I can find it easily. It is beyond haunting...

Apology Fliers

Don't really know if this is really true or not, but it's an example of what one could do justce-wise if one weren't constrained by ossified values from the millennia before last:

A woman judge in Turkey has ordered a wife beater to personally distribute 1,000 leaflets apologising for the act, the Turkish media reported on Tuesday.

Judge Aslihan Limon, 28, in the northern town of Arac served the ruling on Mustafa Kadinci who was accused of hitting his wife and then locking her up after a row.

Apology Fliers. Imagine what we could do if all we were trying to do was provide the best justice system we could, based on effectiveness, fairness, etc. rather than on constraining Anglo-Saxon ideas form 10-something.

Healthcare, Smhealthcare

President Obama writes me:

The campaign to pass real health care reform in 2009 is the biggest test of our movement since the election. Once again, victory is far from certain. Our opposition will be fierce, and they have been down this road before. To prevail, we must once more build a coast-to-coast operation ready to knock on doors, deploy volunteers, get out the facts, and show the world how real change happens in America.

And just like before, I cannot do it without your support.

So I'm asking you to remember all that you gave over the last two years to get us here -- all the time, resources, and faith you invested as a down payment to earn us our place at this crossroads in history. All that you've done has led up to this -- and whether or not our country takes the next crucial step depends on what you do right now.

I think the world of the President, in general. I know he will not embarrass us, he will not do overtly dumb things, he will often do good things, and occasionally very good things. But I'm starting to get a rather panicky feeling...

I've been listening to the debate the last several weeks, and all I hear is mandates and tax credits. And something about gateways or collectives. I know I didn't vote for that. I thought I was voting for universal health care. But this administration starts off by saying that we will never acheive that, so let's settle for some bureaucratic mumbo-jumbo and reforms and affordability and call it a day.

And then he asks me to throw my support behind it.

Look (as the President is so fond of saying), no person in this country should be unable to get healthcare because of an inability to pay. Ask me to work for that and I'm there tomorrow. But to ask me to work for a tax credit, for Clintonian incrementalism, for a no-illegals guarantee, for a public option -- well, as the President would say, "come on now."

Leading a mass movement requires embracing inspirational ideals. It requires pushing for the changes that the people are clamoring for. Many people like their insurance just fine, says the President. That's because they're not sick. To get welfare programs for the poor, people who are not poor had to be convinced to get on board. Mr. President, let's see you do some convincing that every American deserves health care, even if he/she can't scrape up the $890 a month it's going to cost.

Isn't Supply-Side Economics Debunked By Now?

The question I'd like to ask every politician who opposed tax increases and favors cuts to social services is this:

"You are placing a rather large bet on the idea that the budget is best balanced on the backs of the weakest, the neediest, the sickest, etc., and that we must not under any circumstances ask the rich to contribute even one cent more, all on the theory that increasing taxes will cause more harm in the long-run by discouraging enterprise. Given the size and social importance of this wager, can you tell us what evidence you have that this theory is true?

John Cole says:

The unemployment situation is getting worse than was expected, something we all knew anyway:

(And I'm not going to remark on the Thing We All Know(tm)

Here's What To Think(tm):

I don’t think people have processed just how serious is the trouble we’re in. We have been created job-less people at an alarming rate for some time. That is translating, as personal savings are exhausted, the kindness of family and friends is dwindling, and assets are being liquidated, into more foreclosures and evictions—some of which will also contribute to the coming commercial real estate collapse. (So says Atrios, so it must be true.)

We may get to a point where the external indicators agree we have nowhere lower to go. But that won’t mean we start climbing back up. Our economy has been so distorted for so long that it will take a long time to get it right again.
When was the last time housing was affordable? When could most families handle paying their own tuition bills, or health insurance premiums?

Which industries are going to be creating new jobs in adequate quantity any time soon? (Search your heart and you’ll know it ain’t alternative energy, at least not in the next 5 years.)

We are in serious trouble. This is not ordinary ebb-and-flow of the business cycle. Yes, the business cycle still exists, and yes it will eventually stop swinging negative and start swinging positive. But we’ve learned in the recent past that an economy that is in a statistical growth period can still be a hard place to find a place to live, educate the kids, and take care of the sick.

This Is A Good Example

Great post about CA's problem which shows how balancing the books on the backs of the poorest, sickest, ailing, etc. is now the overt and explicit policy of the CA government. It is no longer Something We All Know(tm) but never say out loud. This is out loud for sure.

When NY Gov. Paterson have his first speech on NY's budget woes last fall, he went in this order: First, the sick. Then the old. Then the little kids. Then students. But never, ever, the hedge fund managers -- that would be wrong!

Ah-nolt's experience is CA is eerily reminiscent of Ron Reagan's stint in the governor's mansion and then White House. "Tax Cuts! Yea! Pay for Them By Cutting Government Waste (And Yes I Mean Those Welfare Queens)." Who knew such a tough-but-compassionate guy would end up creating whole new generations of homeless people.

http://downwithtyranny.blogspot.com/2009/05/as-arnolds-political-career-dies-how.html

Jeebus.

Today's NY Times is a perfect example of dumb-ness masquerading as insight. On the front page of the site, the headline manages to blame President Obama for "push[ing] the issue of 'identity' back to fore front."


Seeing it in context is worse. This - likely intentionally -- makes it sound like the President caused this controversy by dint of his nominating a Latina judge. WRONG. EPIC fail.

The controversy is caused by the barely-concealed bigotry of what passes for the leadership of the Republican party. Where is Steele denouncing Rush and Newt? Where's Boehner distancing House Republicans from these people?

The NY Times manages to locate the center of gravity on this in exactly the wrong place. Further evidence, I suppose, that no one with critical thinking skills reads the NY Times before it is published.

I've Never Seen It Put Better

Bob Herbert:

America has become self-destructively shortsighted in recent decades. That has kept us from acknowledging the awful long-term consequences of the tidal wave of joblessness that has swept over the nation since the start of the recession in December 2007. And it is keeping us from understanding how important the maintenance and development of the infrastructure is to the nation’s long-term social and economic prospects.

It’s not just about roads and bridges, although they are important. It’s also about schools, and the electrical grid, and environmental and technological innovation. It’s about establishing a world-class industrial and economic platform for a nation that is speeding toward second-class status on a range of important fronts.

It’s about whether we’re serious about remaining a great nation. We don’t act like it. Here’s a staggering statistic: According to the Education Trust, the U.S. is the only industrialized country in which young people are less likely than their parents to graduate from high school.

We can’t put our people to work. We can’t educate the young. We can’t keep the infrastructure in good repair. It’s hard to believe that this nation could be so dysfunctional at the end of the first decade of the 21st century. It’s tragic.

'Nuff said.

What It Means To Be a Republican

In the dust up over former Vice President Cheney's recent appearance promoting torture, there was a revealing bit that shows what being a Republican means to old Dick:

"I think my take on it was Colin had already left the party. I didn't know he was still a Republican."

"So you think that he's not a Republican?"

"I just noted he endorsed the Democratic candidate for president this time, Barack Obama," Cheney said. "I assumed that that is some indication of his loyalty and his interest."

In fact, old Dick even went so far as to explicitly proclaim that "maintaining our loyalty and commitment to those principles is vital to our success" as Republicans.

Seems to me that Dick's view is that being Republican means marching in lock-step loyal formation. Obedience to orders would seem to be a core Republican virtue, at least according to old Dick.

HHS Secretary

Dear Republicans,

Do you think your concerns about Gov. Sibilius' reproductive rights record might be a wee bit, I don't know, WAY, WAY out of proportion to the real issues here on Planet Earth?

Thank you for shutting up and getting out of the way.

Signed,

One With A Brain

Reader JB at TPM has this insight:

Now that Bush is gone, there is nothing and nobody else for the Republicans to turn to. They can either try to build a new identity for the party from scratch, or they can remain loyal to what they know, as so many 1930s-era Republicans remained loyal to the legacy left by Coolidge and Hoover. The latter course obviously doesn't offer much hope for the future (unless President Obama crashes and burns), but at least it promises safety for the present to the majority of Congressional Republicans representing safe Republican constituencies.

There's two things worth noting. First, those 30's era Republicans who remained loyal to Hoover and Coolidge in fact passed on their legacy -- to Barry Goldwater, Ron Reagan and ultimately George W Bush.

Secondly, there's a certain irony in the fact that Republicans took jerry-mandering to new heights, thinking it would enable them to hold onto their "permanent" majority. However, it seems to be having the effect of forcing Republicans to stick with a failed ideology, thereby ensuring their trivialization. Funny how that works.

I Just Gotta Say

We live in a mass society. 300 million in America alone. And the days when most people were more-or-less self-reliant are long gone -- centuries gone. We have stumbled into a sort of social agreement. Leaders make the choices for us: what work shall there be, who gets to do what, who can live where, will there be education or health care or entertainment.

These leaders have a powerful responsibility. Should there be a social breakdown, restoring order can be difficult, and take decades. What we're living through now is a failure of monumental proportions. Of course, the leaders of our society have been failing in various ways forever -- world poverty stands as a pretty powerful rebuke, for example. And failing to build a society that is sustainable, that provides more and more opportunity for more and more people, that delivers a kind of social justice -- that is the crime which has been committed.

We are coming to realize that we need to re-think our society from the ground-up. Of course, doing so is a wonderful opportunity to avoid past mistakes (and make all new mistakes!). But the fact that we must do so in an environment of crisis is to be regretted, as it was avoidable.

There's nothing natural, or inevitable, or "inherent in the system" about our current woes. On the contrary, many leaders have failed, time and again, to take the right path. While we all bear some blame for suffering our leaders, at the end of the day the leaders themselves must bear the brunt of the responsibility.

I fear that our society has not yet figured out that the people who led us to this point are still hanging around trying to save their skins. We can get better leadership by demanding it, of course. But one of the things that the new leaders must handle is getting rid of the ideas of the old leaders. In these times, it seems, that includes getting rid of the notion that we need to return to a consumer-ist society where "shopping" is a primary activity, where borrowing is "necessary" for consumers to live a good life-style, or that failed businesses must be given new leases on life to redeem their failures.

Things Were Pretty Bad Before The Crisis...

In all the talk about the economic crisis, a fact that get overlooked, one that I think may well prove to be the reason that this recession is fundamentally worse (i.e., harsher, deeper, more prolinged, likely to never truly end, etc.) is that we were already in dire straits:

The recession in Flint, as in many old-line manufacturing cities, is quickly making a bad situation worse.

Most of the coverage in the papers is by (and for, in the case of the NY Times) people of means -- people who had largely escaped the slow decline of the American economy for the previous decade or more.

The recession simply made real to the richest Americans what was long real to everybody else: we had built an economy that was failing to meet the needs of the society it was supposed to serve.

Paging Governor Perry

Texas Governor Perry to the white courtesy phone, please.

I hold that in contemplation of universal law and of the Constitution the Union of these States is perpetual. Perpetuity is implied, if not expressed, in the fundamental law of all national governments. It is safe to assert that no government proper ever had a provision in its organic law for its own termination. Continue to execute all the express provisions of our National Constitution, and the Union will endure forever, it being impossible to destroy it except by some action not provided for in the instrument itself.

Again: If the United States be not a government proper, but an association of States in the nature of contract merely, can it, as a contract, be peaceably unmade by less than all the parties who made it? One party to a contract may violate it—break it, so to speak—but does it not require all to lawfully rescind it?

- Famous 19th Century Illinois Politician

Another Deep Thought

Josh Marshall has a deep thought:

Conservatives are so incensed by warnings about the threat of right wing radicalism that they're considering overthrowing the federal government.

I note as oddly absent in the whole Perry-Texas-Secession debate any reference to the fact that the right of a State to secede via unilateral declaration was the causus belli of the Civil War. The non-Perry-Texas-Secession party prevailed, decisively (or so it seemed at the time).

“I Must Have Somebody,”

Both Frank Rich and Arianna Huffington seem to be developing a case of the vapors. Both cite Geithner as the problem in the administration’s efforts to respond to the unraveling economy. Huffington wants him fired. He is, these and others say, too close to Wall Street. Too invested in the culture of corporate greed. Too close to the problem as NY Fed President. Too…something. The idea seems to be to get someone who is outside the system, someone who is not invested in the banks’ survival to Do the Right Thing. (Maybe Spike Lee is available?) It almost seems that the chorus of would-be Simon Cowell’s are crying for anybody to replace Mr. Geithner.

First, the evidence that Geithner is not succeeding is thin to non-existent. Other than picking off elements of his plans that seem ill-advised, the main thrust of the criticism is that his thinking is too conventional, too wedded with restoring the status quo ante. But the technical measures of the performance of the markets aren’t so clear that Timmeh must go.

Boys and girls, ladies and gentlemen, this is no time to panic. Let’s remember we’re 10 weeks into this thing. Whether Geithner’s plan is smart or dumb should be judged at least in some measure by how well it works.

We need to remember that the criteria for judging his work is not comparison to a perfect person or an ideal Treasury Secretary. A rigorous standard of judgment would suggest a reasonable, successful Treasury Secretary as the baseline for comparison. (A fair standard of comparison would be to compare Geithner to a hypothetical Secretary Phil Gramm, since that’s who we would likely have if we didn’t have Obama making the call.)

Pundits and voters have a hard time imagining the challenges Geithner faces. My guess is that the level of reliable information is appallingly thin. But does it make sense to share that with the public? Is knowing that our regulatory apparatus is dangerously broken something that will help or harm our situation?

We don’t know, by definition, what we don’t know. When Al Gore was asked a few years ago how accurate was the press’ coverage of the Clinton administration in terms of correctly divining what was really going on, he answered (paraphrasing here) “about 5%,” meaning that 95% of what was important was simply missing from the press. Geithner and Obama have a good deal more information than we do, and if their actions seem curious or ill-advised in light of what we know, the likeliest explanation is that they know things we don’t, and in light of what they know, they are acting reasonably and responsibly.

An example. People like to agitate for ending “zombie banks,” those institutions that are dead but haven’t been buried. But which ones, exactly are dead? While we as savvy consumers of news may feel confident saying, “why Citibank and BoA, silly,” that may not be so clear once one starts digging in a little. If the Obama administration seems to be proceeding more slowly than we would like, it may be because caution really is the best strategy in light of all the circumstances. After all, what are the chances, really, that the steady-eddie Obama who we all watched in the election and the transition, who carefully weighed his options and then took decisive action, is suddenly flummoxed, or suddenly under the spell of the Wall St. elite? To me, that seems rather far-fetched.

(I do think Obama has made a communications error in not having Democratic surrogates get off of the “bail-out” terminology. It has allowed a straight rhetorical line to be drawn from the excessive lavishness of the lifestyles of the rich and powerful to the doling out of trillions to try to steady the markets and stop the downward spiral of the economy. We are not bailing out banks; nor are we bailing out counter-parties; we are bailing out creditors and shareholders, and ultimately the borrowers, of these institutions. Some of these folks are rich, and a means test to ensure we are not using taxpayer dollars to pay for luxury is warranted (and I suspect in the works). But a lot of these folks are 401(k) plans, teacher retirement plans, local governments, and others who have seen their means melt away.)

It’s easy to take pot-shots at the plans that are being developed urgently to respond to an unprecedented crisis. One thing that’s little discussed is that whatever steps the US may take could be easily rendered futile if other governments don’t act in harmony with us and each other. Building a coalition of numerous independent governments is going to take a little time.

It’s always easy to criticize, and as voters and readers and pundits that’s something we all know. During the Civil War (another unprecedented crisis forced on an incoming administration), Lincoln was bedeviled by the appaling lack of generalship available to the Union forces (especially compared to those of the confederacy.) Senators (who then as now are basically nothing more than extra-pompous pundits) were crying for the head of McClellan, Lincoln’s top general. Lincoln had no great love of McClellan, but a Congressional Committee on the Conduct of the War demanded his resignation. According to Doris Kearns Goodwin’s account in Team of Rivals (p. 428),

“When Lincoln asked who they proposed to replace McClellan, one the committee members growled, “Anybody.” Lincoln’s reply was swift. “Anybody will do for you, but not for me. I must have somebody.”

Geithner may well not be perfect. (Fairly clearly, Obama isn’t perfect either. Just ask parents of kids trying to qualify for the Special Olympics.) But for Obama, he must have somebody. Who, exactly, does Ms. Huffington propose as an upgrade to Geithner?

I think the Republicans are om the verge of defining anyone who receives any benefit from governmental activity as a Democratic constituent.

Republicans continued to complain, however, that, whatever the bill’s original purpose, it had been stuffed by Democrats with “anything they wanted,” as Senator John Cornyn, Republican of Texas, put it.

I think they may want to rethink that.

Analytical Folly

With so many pundits carping about Obama's struggles in getting his stimulus bill passed, noting that he has taken hits for a lack of bi-partisanship, for a lack of pleasing the progressive left, his naivety in dealing with Washington, etc., it's worth remembering that the correct analysis is not comparing his performance to a utopian ideal President, but to the actual likely alternative: one John Sydney McCain.

Would President McCain be performing better or worse? My guess is that President McCain would be locked in mortal combat with the Democratic Congress over the question or whether to include any spending at all, not the extent and nature of spending.

Just sayin'...

Rich

The very definition of rich.


And somehow irony-free.

Tick Tock

Crazy good.

Floored. Read to the end.

The amazing Billmon had a piece earlier this week that has a simply jaw-dropping conclusion. I won't spoil the fun, but the piece is about how Russians weren't inclined to look at past crimes in the Soviet era, and wondering if something very similar isn't underway here.

There is just a yawning disconnect between the nature of the crimes allegedly committed (and, in many cases, essentially admitted): waging aggressive war, torture, secret prisons, illegal wiretapping on a massive scale, obstruction of justice, perjury, conspiracy -- to the point where it would probably take an army of Patrick Fitzgeralds and a full-time war crimes tribunal a year just to catalogue them all -- and how the story is being treated in the corporate media.

Read it all. To the end.

Jobs. Now.

We are at the end of a decades-long jobs crisis. The only way out is to ensure that every American who needs a job can get one. And that the jobs that are available will pay enough to cover decent housing, food, transport, health care, etc.

Tax cuts will not do it (as we have amply demonstrated over many, many years. Government "infrastructure" plans, as now discussed, are simply too little to make the difference we need.

The federal government needs to take the lead in direct job creation. To me, success will occur when there is a jobs center in every town in the nation where anyone can go to get an actual job. If that means the government has to create some "make-work" jobs so be it. But I think we could get to work addressing any number of our crucial chalenges right now: alternative energy, education that works, affordable housing. All of these require a lot of work, and we have a lot of people who need work. The market has failed to re-allocate these people to these needs; the government has to step in and short-circuit a process that the private sector either cannot do, or will take decades to do.

At some point, the government can sell of the assets it will have created, and can use the proceeds to start to pay down the government's debt.

That's the end-game. Everything else we do -- keep Citibank afloat, give Detroit money to make cars no one wants, give consumers checks for $300, etc. -- is just pushing peas around on our plate.

We need large and decisive moves, and we need them yesterday.

This is nearly the greatest video I've ever seen.



Nearly. (h/t John Cole)

The Truth, Circa 4th Century

The truth, maties:

"What keeps you from giving now? Isn't the poor person there? Aren't your own warehouses full? Isn't the reward promised? The command is clear: the hungry person is dying now, the naked person is freezing now, the person in debt is beaten now-and you want to wait until tomorrow? "I'm not doing any harm," you say. "I just want to keep what I own, that's all." You own! You are like someone who sits down in a theater and keeps everyone else away, saying that what is there for everyone's use is your own. . . . If everyone took only what they needed and gave the rest to those in need, there would be no such thing as rich and poor. After all, didn't you come into life naked, and won't you return naked to the earth?

"The bread in your cupboard belongs to the hungry person; the coat hanging unused in your closet belongs to the person who needs it; the shoes rotting in your closet belong to the person with no shoes; the money which you put in the bank belongs to the poor. You do wrong to everyone you could help, but fail to help."

Basil
4th Century

Thanks to Adventus.

Sometimes, the people on TV don't know what they're talking about.



In my experience, most of the time most of the people on TV have no idea what they're talking about.

I especially like the laughing, smirking dismissal of the Fox business analysts when Peter Schiff correctly predicts that the real estate and stock markets will not in fact go up no matter what.

BHO - Not a Liberal?

The great Glenn Greenwald writes that those who are disappointed by BHO's non-"progressive" appointments have been deceiving themselves.

So many progressives were misled about what Obama is and what he believes. But it wasn't Obama who misled them. It was their own desires, their eagerness to see what they wanted to see rather than what reality offered.

I think BHO plays a more subtle game than this right-left, progressive-conservative sport we've been stuck with for so long. Until quite recently, many thought of universal health care coverage as a strictly lefty, progressive thing. Same with opposition to the Iraq war.

The American people, it seems to me, moved away from the right towards a more progressive, more practical "center," and BHO rode this movement as much as led it. Cokie Roberts still thinks pro-choice is "left," even though a substantial majority favors it (and has for some time).

I don't read BHO as "progressive" or "liberal" or "centrtist" or frankly anywhere along the ideological spectrum that we've used as short-hand for so long that we seem to have forgotten what it ever stood for. Well, that plus the fact that an extreme faction arose in our nation which tried to yank the country to the most extreme views through intimidation and deception.

It's certainly wise to look at BHO's actions so far in the context of his campaign rhetoric: he promised pragmatic solutions, focus on the things we all agree on, de-emphasis of things where we seem unable to agree, a hatred of ignorance, stupidity, and the veneration of things that work. For the life of me, I can't characterize that as left or right, really. (I read it as left since I think of progressives as pragmatics; others, maybe most, disagree.)

I'm looking forward to holding BHO accountable to the nation's wishes, but I'm starting to hear a strain of discontent that he is not 100% lined up with some agenda. Well, no one is. But I still expect to see compelling results, just as we did in the two successful campaigns (and so far, successful transition effort) he's already run.

This is from Mr. Fish at Harpers:

















Me likee.

Hey! I Know How to Fix the Economy and Finally Realize the Dream of Democracy!

Change, via Atrios:

CHICAGO -- Armed with millions of e-mail addresses and a political operation that harnessed the Internet like no campaign before it, Barack Obama will enter the White House with the opportunity to create the first truly "wired" presidency.

Obama aides and allies are preparing a major expansion of the White House communications operation, enabling them to reach out directly to the supporters they have collected over 21 months without having to go through the mainstream media.

I think this misses it -- wide. The opportunity here is much bigger than an excellent e-mail list. It's a chance to engage Americans with its own government using a series of tubes on a new and more meaningful level.

BHO is a techno-geek. He "gets" it. I think one of his initiatives will be a re-technologicalization of the federal government. Sort of like Al Gore and the internet, but married with his "re-inventing" government work.

The federal government had made many software companies and tech consultants rich with an unending series of technological drives. (This isn't too different than what most companies have been doing, either. I'll come back to this.) But there hasn't been a, ahem, transformative exploitation of technology into the fabric of government itself. I think (hope) someone with a higher pay grade than mine (mine being "lowly citizen") will see that this is a multiple-goal serving opportunity. It is aimed squarely at making the government more competent, making it more cost-effective, creating jobs and spurring socially worthwhile R&D.

Here's an example. Why can't I go on-line and browse all my tax records, with ease. BHO has talked about a tax system in which the government basically prepares your return for your review and approval. Why not go with that idea in spades? Here's another: if McDonald's can spy on its workers via webcams, why doesn't the US do the same to monitor working conditions (and if not cams, then whatever remote, automated sensor makes sense)?

This could spark a trend in businesses to do similar things. Con Ed might actually allow me to do simple and easy transactions with them. I might be able to look at the Gap website and see the actual in-store availability of the jeans I want. Or have my cel phone easily configurable and transparent to my computer?

When cars and telephones first came on the scene, there was a rush of great fortunes made in those industries. But after a little while, those technologies transformed not only the economy but society itself. We are at the start of this second, more transformational, wave, and the historical trend could well prove to be a key to turning our economic fortunes around.