Gerrymandering - the root cause?

The moderates of both parties seem to be captive of the extremists of both parties in the budget impasse.  The Tea Party right wing refuses to raise the debt limit if there are any revenue increases, and the Pelosi left wing refuses to allow any of the real spending problems to be cut - entitlements.  


One of the biggest problems facing the country today is gerrymandering of congressional districts.  It is no surprise that the Senate is more moderate than the House of Representatives in Washington.  You can't gerrymander a state.  The political boundaries are already drawn and can't be redrawn.  But within each state the political parties draw the districts to assure safe seats for both Republicans and Democrats.  As a result, the safer the seat, the more radical those who are elected.  You can't have a safer liberal seat than San Francisco, and you are hard pressed to find a more left wing ideologue than Nancy Pelosi.  The same on the right wing, for example Darryl Issa of Riverside County.




As a result, members of the House of Representatives are in safe districts, so the automatic tendency is for candidates to be more ideologically pure than their same party challengers.  If candidates had to run in districts that were politically moderate, the more centrist candidates would win and the extremists would not be able to attract the center, which would decide the victors in more balanced districts, similar to how the presidency is usually decided by the political center rather than the extremist true believers of either party.


The House of Representatives, these days, is always extreme.  It operated far left of center after the Obama victory of 2008, passed health care and gave massive giveaways to pet liberal projects under the guise of Stimulus spending.  And now the House is operating far right of center as it is being held hostage by the Tea Party tax cutting extremes threatening to cause the government to default rather than allow increased revenues to help reduce our enormous deficit.


As a side note, this is why I am totally opposed to the idea of trying to change the relative powers in the Senate.  Ideologues are upset that Wyoming has the same number of Senators as California, even though each state has vastly different populations.  But, their attempts to change this is just another way to try to gerrymander the states in the Senate the same as they have gerrymandered the states in the House of Representatives.  What a terrible, extremist producing idea that is.


Ideology makes smart people stupid.  Everything ideologues see proves to them the rightness of their black and white ideological view of the world.  Pelosi Democrats against Tea Party Republicans - and no chance that either side will ever drop their hatred of the other.


It is up to Obama and Boehner to lead the center to just say no to the drug of ideological extremist absolutism.  


I send my hopes and prayers.

How the International Criminal Court keeps despots in power

George Friedman, of Stratfor.com, points out the unintended consequence of setting up the International Criminal Court in the Hague, Netherlands.  By prosecuting despots for war crimes, they pretty much guarantee that despots will do anything to cling to power when their people rise up to overthrow them rather than negotiate a transfer of power for the guarantee of a safe and comfortable exile. 

For example, Qaddafi has already been indicted for war crimes against his people.  As a result, he cannot accept a political settlement with those trying to drive him from power.  They are powerless to guarantee his safety.  The ICC will try him and find him guilty of obvious crimes against humanity.  The same has to be said for those who surround Qaddafi.  They are also undoubtedly guilty of heinous crimes and would also be sent to the Hague for prosecution. 

So, the tyrants who we want to abdicate and turn over power of their countries to the democracy movements of the Arab Awakening … can’t.  Not without being tried and executed by the Righteous in Europe.

Yugoslavia’s Milosevic died during a five year trial in the Hague.  Karadzic was sent to the Hague despite negotiations between him and the U.S. that if he ceded power he would be granted safety.   South Africa was fortunate enough to make a political transfer of power from the white leadership to Mandela and were granted forgiveness and safety as a result, but that wouldn’t have been possible if the ICC had been in place at the time.

So, the war in Libya drags on and people continue to die.

Is revenge in the ICC sufficient reason to prolong wars against tyrants that kill thousands of people?  I think not.  The ICC was probably not a very good idea, and it may be time to close it down.

The arrogance of being in control

David Brooks writes an insightful column about the underlying problem of the economic crisis.  He points out that three groups decided that they could control the future.

First came the genius banker quants who thought that their mathematical models would take the risk out of investing and thus they would control the future and make fortunes.  Of course, many of them made huge fortunes but that was by selling toxic securities to suckers who were conned into thinking that the quants knew what they were doing, while these banker quants almost destroyed their banks, the financial industry, and the economy of the U.S. and the world - but that is a different discussion.

Second came the true believer Democrat Keynesian economists and politicians who thought that massive stimulus spending would employ people by providing government demand and thus stimulating an economic recovery.  It may have helped a bit, but certainly not as the Keynesians predicted, and I don’t think it helped very much at all, but it certainly did add to the deficit and the debt.

Third, now comes the tax cutting true believers who think that the way to reduce the deficit is to stimulate the economy by cutting taxes and government regulation and thus allowing the always powerful and ready to rumble economy to take off and generate millions of jobs and prosperity for all.  These folks are looking at Reaganomics and overvaluing the effect of untrammeled markets and undervaluing the necessity of government regulation of those markets - which is needed to keep them competitive rather than letting them become forms of theft, corruption, and plunder.

Brooks’ recommendation is a cautious, conservative one:  control both debt and entitlements and “keep tax levels reasonable and the tax code simple.”  Most of all, he cautions against the arrogance of thinking that we have figured out how to control the uncontrollable: the future.

I think that what is happening is that the world is in a state of chaos, and is now obviously uncontrollable.  It is always uncontrollable, of course, but maybe it takes chaos from time to time to remind us of that fact.  And the way people who are afraid of the chaos react to the chaos is to revert to some form of fundamentalism as an attempt to control it.  The right wing goes for tax cuts, the left wing goes for Keynesian government spending, the fundamentalist religious believers, whether Christian or Muslim, look to apocalyptic visions and calls for purity, etc. 

The idea is to try to find a simple formula to control the explosive complexity of chaos.  It never works.

The deficit is the size of national defense and social security combined

Just to point out the obvious, the reason that the debt ceiling must be raised is because the government is operating at a deficit.  The only way the debt ceiling doesn’t get raised is if the government brings in more revenue that it spends, then the government doesn’t have to borrow to pay its bills.  If the government can’t borrow, it can’t pay its bills.  The debt ceiling doesn’t govern expenditures, Congress writes the laws that mandate and authorize spending.  The debt ceiling allows the country to pay its bills. 

How much is $1.6 trillion?  That is the estimate of our deficit; that is about how much more we are spending than we are taking in.

The New York Times has a nice rectangular chart that shows how much money the government spends.

Interestingly enough, the federal government spends the same on National Defense as it does on Social Security:  $738 billion for each.  Add these together and you have a little under $1.6 trillion.  So, to balance the budget by cutting spending, the federal government would have to eliminate all spending on both national defense and social security - which, of course, can’t happen.

We can thank the unholy alliance between the government and the financial industry for creating the housing bubble and the resulting financial collapse that created this monstrous deficit and recession.  Maybe we can legitimately hope that government can get out of the grips of ideology long enough to cut spending and raise revenues to shrink the deficit, and bring government spending and government revenues back together. 

It needs very courageous leadership by the president and the leaders of congress to do this.  Now is the time for them to elevate beyond being mere re-election functionaries and lead the country out of looming financial collapse. 

I have hopes that this is starting to happen.

Have the grownups finally arrived?

President Obama has finally made a big move to do what is needed in the Great Budget Battle.  He is proposing entitlement cuts, including Medicare and Social Security, in exchange for tax reform that raises revenues. This has always what has been needed: a way to raise revenue by lowering tax rates and closing tax loopholes, and real spending cuts in the areas that actually need to be reduced - entitlements.  


Apparently, Speaker of the House John Boehner visited the White House on Sunday and said he was open to raising revenues if he was offered tax reform and spending cuts in return.  Good for him.  Good for Obama for responding with just that.


It has always been necessary to both raise revenue and cut spending since we are borrowing more than forty cents of every dollar the government spends.  The partisans can be expected to lay out unbending non-negotiable demands, but we may finally be on the course to the obvious solution whereby both sides find a way to compromise for the benefit of the health of the nation, rather than obsessively pandering to the extremist wings of their parties.


It will be interesting to see how Democrats will react to the proposed compromise (we know that the Tea Party Wing of the Republicans will thump their chests in outrage at any suggestion of compromise).  I expect a violent Democrat opposition to their president for abandoning their extremist and obsessive protections of their precious entitlement programs.  


Both extremist wings must lose these battles.  Compromise is necessary.   Cut spending and raise revenues.


Have the grownups finally arrived?

Political Party death wish?

The “negotiations” between the Democrats and Republicans on raising the debt limit continues, with appropriate declamations about the intransigency of the others at the table.  This is a predicted Kabuki dance wherein each party is in the process of proving to its respective bases that they are really, really tough and are going to get the best possible deal from the other.

The trouble is, if they aren’t careful, they will go over the cliff by accident, the cost of government borrowing will explode, and the interest on the debt will swallow the government.

If the Republicans think that they can push the country into default and blame the Democrats, they are even more idiotic than they pretend to be.  It is an obvious fact that the Democrats have offered substantial cuts in government spending, and the Republicans have offered zero revenue increases.  The ones who  are refusing to negotiate are the Republicans, and they will be blamed for the consequences of not allowing an automatic raising of the debt ceiling.

The Tea Party sent anti-tax extremists into the government to insist on reducing the size of government, and those true believers are doing what they believe in.  But, the country is not becoming a Tea Party nation, and if the Republican leaders allow actual default, they will be complicit with the death of the Republican Party.

Meanwhile, where are Obama and the Democrats on the necessary proposal for tax reform that will create revenue increases while lowering tax rates and thus bringing in both needed government income and allowing the market and the lagging recovery to breathe?  Are they playing their own political high-risk stratagem of allowing the Republican Party to destroy itself while they pretend to be innocent bystanders? 

Playing politics can be dangerous - to the health of the nation, and to the survival of political parties.

Where is our leader? part 2

The president gave a press conference today and was critical of the Republicans for refusing to raise taxes as part of a congressional agreement to raise the debt ceiling and thus allow the government to continue to pay its bills come August 2. But, unfortunately, he gave no indication of where he stands in the negotiations other than his old, tried and tired urge to tax the super-rich, which will not even come close to balancing the budget.  It looked to me like a campaign speech rather than the leader of our country taking the bull by the horns and leading the country and the Congress into an agreement on reducing the deficit.


When the president spends his bully pulpit time blaming and attacking the other political party as the two parties are in the process of trying to negotiate an agreement, it tells me that the negotiations cannot come to an agreement.  I suppose Democrats were encouraged that Obama finally sounded tough and said nasty things about the Republicans that Democrats want him to say, but I don't see how today's performance created any space for Boehner and the Republicans to find a way to agree to raising taxes as part of what they will agree to.  It looked to me like a pandering to his base and another campaign speech for 2012.


I agree, completely, that the Republicans need to raise revenues.  It is not any news to anyone that this needs to be done.  But for the president to just criticize the Republicans does nothing to move them forward.


The only thing that makes any sense to me on the revenue side is a major tax reform that lowers tax rates, broadens the tax base, and eliminates the tax earmarks that give away special exemptions to taxation.  This was proposed by Simpson-Bowles in December of last year.  The only person in the country that could have taken that report, and the momentum created by that report, was the President of the United States, regardless of who the president was at that time, and regardless of which party the president belonged to.  But, this president ducked.  He pretended to be influenced by Simpson Bowles, and he proposed ... raising taxes on the super-rich ... what a surprise.  


I hope that the two sides agree to sign off on the increase in the debt ceiling by doing two things:  cut spending and make a binding pledge to create tax reform starting August 3, with the President taking the lead with a deadline of proposing an overhaul of the tax system by the end of September.  I see no other way of increasing tax revenues other than massive tax reform.  He doesn't even need to take any time to study the tax reform, all he needs to do is present the Simpson Bowles tax plan and lead the country from his bully pulpit, and lead Congress with good old fashioned LBJ congressional maneuvering and get it done.  


We need leadership, and only the president is in a position to provide it.  It takes more than a jaunty walk and snide attacks on his opponents to get it done.  It takes genius, and genius is what we need.  Maybe this crisis will finally awaken the man in the White House to become the leader that I had voted for two and a half very long years ago.

Where is our leader?

The non-partisan Congressional Budget Office has just issued a declaration that the country is headed toward a massive deficit explosion if we don’t cut spending and raise revenues.  Not a surprise, of course, but this official governmental declaration puts teeth in the obvious.

The main culprits of runaway spending, says the CBO, are Social Security, Medicare, Medicaid, and Obamacare.  The quickest way to raise taxes, they note, is to repeal the Bush tax cuts on the wealthy AND the middle class.  Both parties are dealing with this, the biggest crisis of my time, as complete idiots.  There is a kind of stupidity that only smart people are capable of, the stupidity of entrenched ideology.  And both parties are deeply entrenched in ideologies that are obsolete and toxic.

The Republicans have taken an idiotic blood oath to never raise taxes.  The Democrats have taken an idiotic blood oath to never cut entitlements.  This puts the country on the Greek path to financial and economic doom.

A dear friend has pointed out that we are dealing with a failure of imagination.  I believe that what people cannot imagine is the sincerity and decentness of  their political opponents' positions and values. 

Democrats can only see the Republicans’ desire to cut spending as the caricature of Republicans that they carry in their ideologically twisted minds – as greedy and uncaring pawns of the super rich.  That way, Democrats don’t have to confront the terrors of a government that is too big to succeed.

Republicans can only see the Democrat’s desire to maintain and expand entitlement spending as a caricature of Democrats that they carry in their ideologically twisted minds - as catering to the special interests that have kept them in power since FDR and attacking the golden goose of capitalism that lays the golden egg of prosperity.  That way they don’t have to confront the terrors of an aging, middle class and poor populations trapped in poverty, mediocrity, and hopelessness.

None of this is going to change without remarkable leadership, and the only position in the country that has the ability to lead the country into the deep and painful direction that it needs to go (cut spending and raise revenues for goodness sake, it's not that hard to figure out) is the presidency.  But, Obama is missing in action.  He seems remarkably passive in this drama being fought out in the House and the Senate.  His VP, Biden, is trying to bring the sides together, but it is all inside baseball.  And inside baseball is not going to get it done.

The terrible truth is that politicians on both sides of the isle are probably correct in thinking that if they raise taxes as Republicans or cut entitlements as Democrats they will be voted out of office.  So, they do what the most cynical observers of politics say they will do: anything they need to do to stay in office.  And, if they do what is needed to rescue the country from financial Armageddon they will be voted out.

So, who needs to demand that they come together and do the painful things that are needed to save the economy and the government is us.  The people need to wake up and realize that we are all Greeks now.  And we shouldn’t shame ourselves by metaphorically doing what the Greeks are doing, which is taking to the streets to demand that nothing change and the gravy train continues for them.

Only when the country decides that we need less government and more government taxes will the deficit explosion be successfully dealt with. If we don't, the debt and deficit explode and the interest on the debt wipes out all of the rest of government anyhow, and all that is left is paying off our debt.  


I think this is possible. I think most people have made that very change in their own lives by realizing that they were spending more than they were taking in and have made personal changes to live within their means.  I think a very large percentage of the voting populace will accept the same formula for our government to take those same steps.

What they need is a credible leader to make the case of the government doing what is needed to live within its means.  The first step has already been taken by the Simpson-Bowles Commission laying out the spending cuts and revenue increases needed.  The next crucial step is now needed – a leader to forcefully and persistently and persuasively to make the case to the voting public. 

Obama could have been that leader, but he has ducked.  I don’t see him or any Republican contender taking that message to the people for the 2012 election, both sides are singing to their own choirs, neither is leading to make the case to do BOTH cut spending and raise revenues. 

Where is our leader?

Futility in Afghanistan

David Brooks in the New York Times outlines the fundamental flaw of our attempts to build the nation of Afghanistan.  Somehow, Westerners are convinced that bad behavior is a function of poverty.  It's not.  Bad behavior is a function of choices.  In Afghanistan Brooks points to tribal feuds, old and new grudges, and religious fanaticism are much more the source of ongoing strife than lack of opportunity for young men.  I would add the culture where honor is the root value, various ways that the Americans and rival tribes and factions manage to dishonor various Afghanistani sectors is an escalating factor.


More money into Afghanistan sounds good to American ears, sounds compassionate, sounds smart, but it looks like all it is doing is overwhelming an old culture with more western wealth than it can deal with, and ends up so distorting the society that we are working at cross-purposes with our nation building efforts.  


Our need in foreign countries is to work within the frameworks of the countries themselves, but that is pretty much impossible when we have scores of thousands of troops there as part of our own self protection.  


The old saying is that once you are up to your ass in alligators, it is hard to remember that you came to drain the swamp.


Maybe the swamp in Afghanistan has been drained sufficiently of al Qaeda, and it is time to leave the alligators behind and come home.


Obama, as usual, looks like he is trying to find a way to kind of leave without leaving too fast and offending too many Americans as he does it.  He has apparently laid out a draw down schedule that is faster than wanted by the military, but slower than is wanted by American doves.  It's a tough call as to how to get out of Afghanistan, and there is probably no way to do it without some sort of disastrous consequence, but a lot of people are tired of fighting, and paying for fighting, the alligators.

Rory to the rescue

I had the pleasure of watching Rory McIlroy win the U.S. Open by eight strokes.  One thing is obvious: he is so different from Tiger. 

Rory is very human: as I was rooting for him I was actually anxious that he might come apart and start to make mistakes and lose the tournament, whereas Tiger has always been cast as a kind of super-human.  With Tiger it was as if he had been dropped into the golf world from the planet Krypton.  His feats were astounding.  Rory is different.  He is just a very human, and quite excellent, young man.  I can feel a connection to Rory that I never felt with Tiger. 

I am very glad to have been able to watch Tiger play what was perhaps the greatest golf of all time. Watching Tiger play golf was, in a strange way, to inhabit a kind of adolescent fantasy of skills and powers beyond human dimensions.  You couldn't identify with Tiger, you could only fantasize about having his golf superpowers.  

His era is likely over now, and a new era of young kids in their twenties has been arriving for the last couple of years, and is now firmly in place with Rory’s masterpiece at Congressional this weekend. 

I think that Tiger sabotaged himself with his sub-human behavior which eventually became public and destroyed his marriage, his career, and his golf game.  I think that his father shamed him by putting super-human expectations on him, which he could not live up to, especially in the world of golf, the most unpredictable and uncontrollable sport of them all.  I believe that Tiger had a sub-conscious urge to be less than super-human and eventually to be found out to be less than super-human.  Unfortunately, he seems to have been able to see only two polarities: super-human or sub-human.  Maybe someday he will be able to become just human, with nice qualities of desiring to be excellent at golf and be a good man.

I wish Tiger well.  And I hope that he is taking this time in his life, where he is no longer viewed as super-human, to become human, and a good human.  It would be so good if he softened himself up and let go of his domineering, hard, unapproachable shell.  That may be too much to ask, but we golf fans are being given a different gift in the name of Rory McIlroy.  I don’t think Rory will be able to overwhelm the sport the way Tiger did, but I do expect to see him in contention for decades to come, and what a pleasure it will be to see a nice person, a very human person be in that lovely position. 

With any luck, Rory will not become the Next Tiger, he will just continue to be a nice human being who continually grows as a golfer and a man.

The election issues

Presidential elections are often a response to the perceived weaknesses and strengths of the existing president.  


To the right wing, Obama is a leftist and their design for their run at the presidency will be to run as free market right wingers against Obama the leftist/socialist.  


But, to the moderate wing of the Republican Party, say Romney or Huntsman, Obama is an ivy league professor trapped in the wrong job who doesn't have the skill set needed to be a competent, decisive leader.  


I think that if the Republicans have any chance at replacing Obama, they must run on the issues of competent leadership, especially in the arenas of the economy and foreign policy.  If they can dodge the true believers demanding ideological purity, they may even have a chance to win.

Depressing presidential election campaign coming up

David Brooks wrote an article that expresses my sense of disappointment, maybe even despair, regarding the upcoming presidential contest.  The problems of the country are almost overwhelmingly important and challenging, and our candidates in both parties seem to be remarkably unable to deal with them.

I wish I could be happier with President Obama, but I’m not.  The structural problems of the economy, deficit spending and joblessness, just don’t seem to have captured his attention, or at least they haven't inspired his creativity and leadership.  His deficit solution seems to be to “tax the rich”.  This is a theme for Democrats since FDR, and it is woefully inadequate now.  Taxing the rich makes only a small dent in the deficit.  He seems to think his health care overhaul is going to bring down medical costs, but that won’t even come close to closing the deficit enough without serious entitlement cutting.

The Republicans are even more hopeless.  Their solution seems to be to “lower taxes".  This is a theme for Republicans since Reagan, and it is woefully inadequate now.  Lower taxes are supposed to stimulate the economy and thus raise government revenues and lower deficit spending, but those increases, if they work at all, will be far too small to handle the looming deficit and potential loss of U.S. credit ratings without revenue increases.

As the problems get bigger, the politicians get more entrenched in obsolete ideologies that might have been reasonable approaches to the problems of decades ago, but don’t look to me to address today’s problems, shoot, they don’t even seem to notice today’s problems.

Brooks’ solution is to address four areas:  entitlement reform, working class empowerment, political corruption, and pro-business environment. 

He proposes what he calls a “Hamiltonian agenda” which would be pro-market where appropriate and pro-government where appropriate.  But the parties are stuck in either pro-government (Democrats) or pro-market (Republicans).  Neither is sufficient. 

I think that the party that produces a leader that is both/and rather than either/or will lead his party into the future, and the other party may well die.  I had hoped Obama was that man three years ago, but I’m not seeing it now when it is needed so desperately.  It’s going to take some magic for that to happen.  He talks both/and, but leads either/or.

Maybe Romney or Huntsman can con their base into voting for them, and then become a pragmatic both/and leader in the end.  It’s going to take some magic for that to happen too.  

Gingrich and the pitfalls of entitlement

From just the personal unlike-ability and poor-character level, Newt Gingrich never had a chance to become President of the United States.  But his nearly immediate self immolation is still a surprise.  After all, isn’t he actually smart and politically experienced? 

What his failed campaign shows me is the pitfall of the excess egotism of entitlement.  That is, he seemed to think that he could get the nomination and the presidency by taking short cuts – just be smart, interesting, provocative, creative, etc.  Sarah Palin has the same entitlement/shortcut mentality – just be a captivating media personality and the country will give you the nomination and presidency. 

The truth is obvious that running for president is a full time occupation which includes a lot of tedium and patience and persistence.  I’m sure that endless fundraising and answering the same questions over and over are no fun.  But, there are no shortcuts.  It is an exhausting process that tests and reveals the character of the participants.

So, Gingrich is out.  Ironically, one of his political mistakes was stating an obvious truth when he criticized the Paul Ryan budget plan as “right wing social engineering” which he opposed the same as he opposes left wing social engineering. 

But, that is another matter that deals more with the delusions of the right wing faithful about the infallibility of their ideology.

The Republicans aren’t offering much in the way of opposition to Obama, which is a shame because I’m not real happy with the job the president is doing.  One thing I am very confident about is that the country is not going to elect a right wing extremist.  How a reasonable person gets nominated in the Republican party is a mystery to me.

Who to root for in Yemen?

Dictator Saleh was seriously injured a couple of days ago and fled to Saudi Arabia for hospitalization and surgery.  On the one hand it is good to see a tyrant wounded and probably not able to return.  However, from what little I have read about Yemen, the government power structure will probably stay intact and continue their attacks on the rebels.


My inclination was to hope that the rebellions in Yemen are part of the broader Arab Spring rising up throughout the Middle East - a striving for freedom and self determination of the peoples.  However, Fareed Zakaria was interviewed by Elliott Spitzer on his In the Arena show last week, and he said that in Yemen the countryside is controlled by Al Qaeda in the Arabian Peninsula (AQAP), the most powerful branch of Al Qaeda today.  So, I can't root for them, even though I can't root for the tyrannical government either.  


So, all that's left is to hope that the true spirit of the Arab Spring overtakes the protests in Yemen and frees itself from both the tyrannies of the government and of Al Qaeda.  

The trouble with tribes

I spent a long weekend at a lovely wedding of the son of a dear friend.  Along the way, I had some nice conversations with new people.  One conversation was with a lovely woman who is very passionately political.  I enjoyed our exchange, but I came away from it with a renewed sense of how tribal we are.

By we, I think I mean the Boomer generation, although the tribes go beyond my Boomer generation as well.  Our Boomer generation has been waging the culture wars for decades.  I, personally, am sick of the culture wars.


This woman's cause of the day was protecting the honest, hard working, underpaid government workers from the ravages of budget cuts to their pensions.  She sees this in good vs. evil terms:  those evil, greedy people from the opposing tribe want to do evil, greedy things to people of her tribe.  I could have asked her what did she propose be cut from the budget rather than pensions, but I was really just hoping to get away from a political discussion with her.  (I'm pretty sure her response would have been that all we need to do is raise taxes on the evil, greedy people of other tribe, but I digress...)


Actually, I think her purpose for the topic was to see if she could identify me as a member of her tribe so we could delight in the shared shared pleasures of  bemoaning the fate of having to live in a world that included such greedy, evil people of the opposing tribe.


I can certainly see her concern, and think it is legitimate, that the terrible budget problems of the state of California aren't the fault of the government workers, so why should they bear the brunt of the budget cuts.  But, like I say, where do you cut instead?  Everywhere that you look for budget cuts are painful and unfair.  But we need to cut the budget.  


And we need to raise revenues.  Cut spending, raise taxes.  Obvious.  But the two tribe refuse to see the obvious.  One side only wants to cut spending, the other only wants to raise revenues.  They are wrong.


The only way to end the culture wars is stop waging the culture wars and look at the members of the opposing tribe with respect.  They have concerns that are as legitimate as the concerns of our own tribe.  This may be easier for me to see because I have been both a left wing whacko and a right wing whacko, and I know that they each have noble concerns for humanity which are legitimate and need to be heard and addressed.  


Compromise and cooperation is so needed today, but to get there we need to call off the wars and see each other as human beings rather than as sub-human enemies.

Derivatives still unregulated

Mark Mobius, of Templeton Asset Management has said that another financial crisis is inevitable because the issues haven’t been resolved.

“Are the derivatives regulated?  No.  Are you still getting growth in derivatives?  Yes…The total value of derivatives in the world exceed the total global gross domestic product by a factor of 10... Are the banks bigger than they were before?  They’re bigger…too big to fail.”

These derivatives are the way the gigantic financial institutions gamble, and create enormous wealth for themselves by their trading activities.  I don’t care how wealthy anyone gets, if it is a legitimate way of doing business, but when the banks are risking the livelihoods of all of the rest of us, when the economies of America and the world are put at risk so they can make fortunes that will last for generations, I object.  

Give me liberty or give me death

It is Memorial Day, a day to remember our soldiers.  And I do, with gratitude.  Their service guarantees our freedoms. 


But, I want to look beyond our borders in a strange place to find the essence of Memorial Day - the Arab Spring.  I have read that the fundamental cry of the young in the Muslim world as they fight for their own freedom and self determination is "I am a man."  It is a response to decades, perhaps centuries, of being humiliated and being tyrannized.  


Back in February I read that another rallying cry in Egypt was "Give me liberty or give me death."  And, isn't that the essence of democracy?  Isn't that the essence of America?  Isn't the very founding of America based on that powerful ideal:  liberty? freedom?  The ability of people to create their own lives out of their own responsibility?  Isn't the push for liberty in the Muslim world a culmination of an over two hundred year world wide push first declared in America in 1776?  Isn't it time for all of the world to be free?


Although there are many reasons to be afraid of the progress toward freedom and democracy in the Middle East, I am fundamentally hopeful.  I don't believe that those who risked and lost their lives throwing off the ossified tyrants of the Middle East will allow their hard won freedoms be stolen from them by newly minted religious tyrants like the Taliban or al Qaeda.  I expect democracies in the Middle East to be unlike Western democracies, but I expect that they will adhere to the fundamental ideal of allowing greater self determination of its peoples.

Palin's travelling side show

I guess Sarah Palin wants people to think she is running for president.  I think she is just another Trump – wanting to draw attention to herself because she has become addicted to the spotlight.  It’s heady stuff, I suppose, to be such a media draw, both lionized and condemned. 

But, I can’t see her doing anything more than trying to make a lot of money as a media star.  She is so unprepared to be president that even the Tea Party folks will turn away, I believe.  She hasn’t taken the last couple of years after her VP run to become more knowledgeable and expert at foreign and domestic affairs.  She just seems to think that all she has to be is spunky and cute and ride a wave of right wing anger at Big Government, and tada… she wins. To me, her new bus tour is little more than a travelling side show.  The problem is that her pandering to the hard right could push more reasonable candidates to the right in self defense.

Of course, the hard right wing wants a hard right winger to capture the Republican nomination because they are convinced that the way to win is to be a hard right winger.  But, that’s the same reasoning that the hard left wingers have – the way to win is to be a hard left winger. The extremes always think that the moment for the great political awakening of the populace is just around the corner: all they need is the right messenger and the country will be transformed into people just like themselves. 

I really don’t think that the Republicans will go for the extremists.  In 2008 Rush Limbaugh did everything he could to derail McCain, and he failed.  The extremists in the media get fine ratings, but they only sing to the choir.  Lots of noise, but I expect that even in the primaries, where the extremes have an oversized influence because they are more highly represented in the voting totals, the Republicans will choose someone more moderate than someone like Palin.  If not, they guarantee a humiliating loss in 2012 – think of McGovern in 1972.  

The middle of the road is good

When young, I had been a liberal (as I was supposed to be in college (’64 – ’68)) but then I had to rethink everything because of something I saw – the Vietnamese were risking their lives and dying to leave Vietnam after the communists won the war. 

If Communism was just an economic system, why were people dying to get away?  If Communism was some kind of idealistic dream of equality, how did you explain the Vietnamese, and the Soviet Gulags?

So, I read.  And I became conservative.  And I voted for Republicans, mostly, from Reagan to Bush 2.

But, then another strange thing happened.  I saw something else: the financial collapse of ’08.  And I am rethinking everything again.

If deregulated free markets are so wonderful, why was the government needed to keep the financial industry from self destructing?

If the most brilliant guys ended up on Wall Street, why were they such idiots?

I see it as the same problem as Liberalism with a Big L, the same problem as Communism: religious belief in an ideology will necessarily destroy people and itself given enough time.  Those trapped inside a religiously held belief – free market fundamentalism for example – can never see reality.  They are trapped inside a bubble where everything they see is a reflection of their own unshakable beliefs. 

And the rest of us suffer – Communism killed over a hundred million people, free market absolutism has unemployed and underemployed tens of millions in America alone.

So, my new attempt is to say no to both the right and the left ends of the political spectrum, to stay out of self-contained ideological bubbles that can’t see reality for what it is.  To be temperamentally as well as ideologically moderate. 

The only thing in the middle of the road is road-kill?  Maybe not, maybe that’s where the road is.  The edges on each side go off into the ditch.

It’s about values:  conservatives value freedom and opportunity the most, liberals value caring and compassion the most.  Both sets of values are needed.  And only in the middle can both be incorporated.

Extremists losing popularity

Not that it is much of a surprise, but some of the more extreme politicians are losing popularity.  John Avalon of the Daily Beast points out that a Democrat became the mayor of Jacksonville, a conservative stronghold, and the new Republican governor of Florida, Rick Scott, has driven his ratings down due to his confrontational assaults on government services.  Wisconsin's Scott Walker has been unnecessarily confrontational, as has Maine's Paul LePage, and also Ohio's John Kasich.  

It looks to me like each of these men, and the more extreme end of the conservative spectrum in general, have over-read their electoral victories.  They seem to think that the world finally has come to its senses and supports their ideological absolutism.  Their most fatal flaws seem to me to be their harshness of their approach, plus their compulsion to also enact social conservative agendas as well as fiscal.  

In fact, most election reversals are a reaction to the extremism or incompetence of their predecessors, not the joining of a different ideological extreme.

So, what to do about the crying need to reduce deficits?  Well, one thing is to keep your eye on the goal - i.e. to reduce deficits.  The hard right seems to be using disastrous deficits to promote their actual goal of reducing the size of government, especially its support of the lower classes.  I would be much more sympathetic to their efforts if they also proposed to raise revenues as well as cut spending.

Avalon's best point is that being fiscally responsible doesn't have to be polarizing.  I don't follow Andrew Cuomo, the new NY governor, but Avalon says that he closed a $10 billion budget deficit without new taxes, by cutting spending, and getting concessions from the public sector unions - and his approval ratings skyrocketed, rather than plummet like the ratings of the Republican governors listed above.  

Cooperation, respect, negotiation, compromise - the tools of governing rather than the tools of inciting radio and television audiences to build ratings.  Isn't it time for politicians to distinguish themselves from the media zealots and convince the voters that extremism itself is way to destroy the country we all love so much?

Schneiderman steps up to the banks

I am surprised and gratified that the New York Attorney General, Eric Schneiderman, has responded to the Senate’s report on the actions of the too-big-to-fail banks that caused the financial meltdown in 2008.  Yesterday, I had called for us to watch the U.S. and New York justice Departments in the aftermath of the Senate publication of a 650 page report labeled "Wall Street and the Financial Crisis:  Anatomy of a FInancial Collapse."  Would they act?  Would they take these giants to court?

Today, Schneierman’s office requested information from Bank of America, Goldman Sachs, and Morgan Stanley about their mortgage securities operations. 

At least one issue, in my mind, is defrauding their clients in order get rid of valueless Mortgage Backed Securities and other derivatives from their own books once they saw the housing bubble ready to collapse. 

In addition, I would expect an even bigger issue might be the investigation of fraud in creating these MBSs and CDOs and other nearly incomprehensible investment schemes in the first place, and getting them AAA ratings from the rating’s agencies.  A pretty large percentage of these securities were fraudulent from the outset.

I very much hope to see very large trials for some very large titans of the out of control financial industry. 

I compared today’s problem to the issue before Teddy Roosevelt over a hundred years ago, where he ended up being the great “Trust-buster”.  He ended up restoring competition in the markets by busting up the trusts which had robbed the system of competition.  I think the same needs to be done today to put competition back into our financial system by busting up the too-big-to-fail financial behomoths.

If the Obama and Holder don’t want to take on the oligarchy, perhaps New York can.

Bust the bankers

The financial meltdown had many causes, but there is no doubt in my mind that chief amongst the guilty were the executives of the too-big-to-fail financial giants.  They took bad sub-prime mortgages and converted them into toxic assets and eventually dumped as much of this self-generated toxic waste onto their clients as the could by representing them as recommended investment opportunities - to suckers dumb enough to trust and believe them.  That is to say, they defrauded their clients.  Which is a felony.  And they should go to jail.


The regulators didn't regulate them, the politicians let them re-write the laws so they could be over-leveraged and be under-regulated, the government oversight institutions didn't believe in over-sight.  But, the ones who should go to jail are the ones who perjured themselves in Congressional hearings.  That would be Blankfein and other Goldman Sachs executives who did their best to say nothing when they were being grilled by the Levin-Coburn Senate hearings.  They just released a 650 page report labeled "Wall Street and the Financial Crisis:  Anatomy of a FInancial Collapse."  In it is ample evidence of Goldman and others defrauding their clients and perjuring themselves before Congress.


Where is Obama's Justice Department?  Where is Andrew Cuomo, or more to the point the New York Attorney General, Eric Schneiderman?  It will be worth watching these men respond to clear evidence of illegal activity by these financial titans.


It is easy for us to see that countries in the Middle East have been hijacked by tyrants:  Egypt had been hijacked by Mubarak, Libya has been hijacked by Qaddafi, Iran has been hijacked by Ayatollah Ali Khamenei, Iraq had been hijacked by Saddam Hussein, etc. But, it's harder for us to see the extent where America has been hijacked by Wall Street.  


The Rolling Stone's Matt Taiibi has an article that goes into some detail about the contents of this report: from disarming of the regulatory system to the perjury before Congress.  He makes a good case that these Financial titans will have the best legal defense that money can buy, but their Achilles heal will be their obvious, indefensible perjury before Congress.  Punishment is five years in federal prison.  


So far, these oligarchs, who essentially run this country for their own looting profit, have escaped with hardly a scratch.  It's time to scratch back.


After releasing his report, Senator Levin said "In my judgment, Goldman clearly misled their clients, and they misled the Congress."  These are federal offenses.  Send them to jail.


To quote Taiibi:  "For years, the soundness of America's financial system has been based on the proposition that it's a crime to lie in a prospectus..."  Goldman went way beyond lying in a prospectus.  It sought suckers, defrauded them, and are now congratulating themselves for being "smart" by seeing the collapse of the bubble before others did and getting rid of the toxins by finding those stupid enough to believe in their recommendations.  


To my mind, this is much more than punishing a few bad actors.  It is more than trying to reform the financial industry.  It is about saving the capitalist system and America itself from the oligarchs who have hijacked it.  Teddy Roosevelt busted the trusts over a hundred years ago, and in so doing he put competition back into the marketplace.  The same needs to be done today.  


Send the criminals to jail, break up the too-big-to-fail financial institutions, put teeth into the Consumer Protection Agency, take the country back from the oligarchs.


It seems like it is too late and that the oligarchs already won, but it's not over unless the fat ladies refuse to sing (i.e. the Justice Departments of Washington and New York fail to take these men to trial).

How to raise revenue

Even though Republicans seem to have taken some kind of blood oath not to raise taxes, it is obvious to me that in order to reduce the deficit and make the U S Government treasury bills a sound investment, and thus keep their interest rates low, the government needs to both cut spending and raise revenues. 

So, how to raise revenues?  It looks to me like there are three ways.

First, raise tax rates.  This might be the easiest solution politically, and the one that Obama supports.  Of course, he only wants to raise tax rates on the top 2%, and thinks he can sell that politically.  The trouble with that is that it doesn’t raise nearly enough revenue to make any real dent in the gigantic budget deficit; it raises about $36 billion per year, which is peanuts compared to a $1.6 trillion deficit.  The only way to get enough money though increased tax rates is to raise tax rates on the middle class as well as the super rich. 

Second, close the loopholes and deductions for individuals and corporations - otherwise discussed as eliminate tax earmarks.  This would have to fight every lobbying group in America.  I am all for it, but the voting population has to have a much more urgent sense of financial catastrophe before it demands such a move.  These tax expenditures cost $1.1 trillion per year, and eliminating all of them would go a long way toward getting our deficit down to a normal, acceptable size. 

The third possibility is to put a cap on the total reduction in taxes that individuals can get.  Martin Feldstein calculates that by limiting the maximum tax reduction to 2% of total adjusted gross income would raise tax revenues about $278 billion.  Still not nearly enough, but that amount would grow over time.  I would ask Mr. Feldstein to make the same calculation on setting a maximum reduction of taxes owed by corporations and businesses as a percentage of gross sales.  I would guess that these two tax reduction caps would go a long way toward dramatically lowering our deficit, and thus keep the credit ratings of the U S Government good enough to keep the interest rates on U S Treasuries low and the percentage of the budget needed to pay for the interest on the debt from skyrocketing.

Of course, none of this will happen without strong, persuasive leadership from the only person who can provide that leadership – the president.  The alternative will be for us all to wait until the financial catastrophe hits, and interest rates take off, and the interest on the debt eats up budget leaving no money for anything else.  By then, I don’t know if it would be possible for the government to act in a way that would bring the interest rates back down.  At least, not for quite a long time. 

Pro-active is better than reactive. 

Don't show a picture of a martyred bin Laden

People are wanting to see a photo of the dead bin Laden.  I think it is a terrible idea.  If you go into a Catholic church, or into many Catholic homes, what is front and center?  The crucifix, a sculpture of the martyred Jesus.

 I don’t know when the crucifix became the symbol of early Christianity, but I would guess that it was used as a symbol to help the Christians spread their faith in the face of persecution, oppression, and murder – i.e. to become martyrs to the faith and follow in the footsteps of Jesus to suffer and die if needed to save the world.

There could have been many symbols of Jesus that could have become his iconic image.  Why not symbols of miracles – fishes, wine, walking on water?  Why not his resurrection – rising from the ashes and reborn anew?  Why not love and healing – making the lame walk or curing lepers? 

I expect the choice of the crucifixion was a choice that did the most to encourage the faithful to keep going in the face of great odds, lions in the coliseum and other persecutions trying to stop the spread of a new religion.

The last thing Obama needs to give the world is a picture that could become a symbol of Jihadist martyrhood to incite the fanatical bloody jihadists.

Syria trying to hold off the Arab Spring

Each of the Middle Eastern countries is unique and has to be understood individually, even though the Arab Spring continues to bloom and all of the Middle Eastern tyrannies are doomed, eventually, I believe. 

Syria is an especially nasty police state, it seems to me.  Assad continues to brutalize his population with impunity.  Apparently, Assad heads up an Alawite minority elite who understand that they must stick together in order to stay in power and rule over a largely Sunni majority country.  Assad and the Alawites control the military, and they have loyal connections to a Sunni Baathist political monopoly.  So, this situation is different than Egypt, where the military turned on Mubarak as a way to appease the population and protect their own hold on power at the same time.   The entrenched powers don’t want to turn on Assad because they will fall with him, and the surrounding states want to keep their own status quo so they don’t want to do much to destabilize the Syrian status quo.

So, there are many forces against the spread of the Arab Spring to Syria, but my money is on the passion for freedom arising in the Muslim world.  The fires of freedom have been kindled and feed upon themselves.  Qaddafi and Assad are doing their best to quench them, but I think the most they can do is delay them temporarily.

Bin Laden's death and the Arab Spring

It is certainly good news that the U.S. finally found and killed Osama Bin Laden. His messianic decision to change history by attacking the U.S. and the West to establish a new Islamist Caliphate has caused enormous pain and suffering in the world, mostly in the Islamic world.


But, I don't feel a great joy at the event.  I feel more sad than elated.  Sad that we live in a world where the death of someone is a good thing.  Certainly, Bin Laden is gone now as a strategist and leader of the Islamist jihad against the West, and that is good.  But, he will likely be viewed as a martyr by those who have dedicated their lives to bloody jihad, and I expect that they will continue their lethal fanaticism.


In a way, I think that the Arab Spring of revolutions across the Middle East is doing more to marginalize Al Quaeda than even Bin Laden's death.  The issue in the Arab world today is not the desire to drive out the infidels, but rather to drive out the corrupt tyrants that have been terrorizing their subjects for decades, even centuries.  I expect that those in the Islamic world who are bloody jihadists will want to use Bin Laden's death as a reason for revenge against the West, and the rest, who are the vast majority I believe, will note it in passing and return to the real work at hand for them - freedom.

Baseball and the madness of greed

There were many villains in the financial meltdown of 2008, and millions around the world continue to suffer from the crisis.  But I say financiers behaved “naturally” in response to a force from outside of the financial industry (one of the villains) and from outside of government (another of the villains). 

That force is baseball: or more to the point, baseball salaries.  I have made this point as a joke in the past, but it turns our Malcolm Gladwell made the same point on Fareed Zakaria's show this morning.  His point was that in the '50s CEOs and corporate lawyers  and baseball stars didn't make much money because capital, the money men, had the power and they set the wages.  The top achievers earned more than the others, but the  differential was not enormous.  

But, all of that changed as the economy grew so dramatically from the '60s forward.  Suddenly there was plenty of capital to go around, and the top producers, the "talent", started to see themselves as indispensable with plenty of money men out there bid for their talents.  So, the power relationship shifted from capital dominating compensation to talent demanding capital. 

A few years pass, and baseball shifted from Mickey Mantle making $100,000 a year (a lot of money back then, but not astronomical) to modern salaries in baseball. You can see the same in salaries for the top  movie stars and music stars - they become mega-wealthy.

So, the point is, as long as A-Rod makes $33,000,000 per year, how can any self respecting mega-important titan of the financial industry, especially one who lives in New York, settle for anything less?  So, we had the financial industry set up compensation systems for themselves that gave them super-star compensation.  And, since these guys felt so important and so smart, they felt totally justified in those levels of income.  And, so did the rest of us out of deference to them, thinking that they were getting their wealth by being very smart at running the financial world.  

But a funny thing happened.  The financial world fell apart, and we started reading articles and books about these financial titans and we discovered that they had basically put together a system that siphoned billions of dollars from the middle classes and stuck it into their yachts, planes, and mansions, and trophy wives.  They weren't smart masters of the financial world, they were greedy charlatans creating legal ways to bilk the masses of their life savings.

I think the world is out of balance, and I think we will know that the world is back in balance when the top baseball player is paid about 20 to 30 times an average middle class salary in America – say about $2,000,000 tops.  That’s really a lot of money – in a world that is not addicted to hyperactive, egomaniacal spending and consuming – and it’s really enough for a superstar with a career that spans only about fifteen to twenty years.  Who says restaurants are supposed to charge $1000 for a night out? Or that homes should cost $20,000,000? Or that private grade schools should cost $30,000 per child?  When did all of this happen and why do we think it is OK? 

I say it all started when baseball superstars started making multi-millions.  End the madness. 

Get back Jo-Jo.