Wednesday, April 30, 2008

Alone, in my car, screaming...

Okay, it's true I spent the last two hours in stop-and-crawl traffic on the Long Island Expressway, but that's not the worst of it. While I was out there, you see, I was listening to the news.

Granted, it was not as awful as it might have been. The Fed cut the overnight rate only a quarter of a percent, and seemed to suggest further cuts would not happen any time soon. The Jeremiah Wright brouhaha seems to have peaked, although it's far from gone.

The problem, as usual, was taxation.

Pander-bear John McCain, as we all know, already had called for a "gasoline tax holiday" this summer -- as if eighteen cents a gallon made a real difference. I have to say I was somewhat surprised when I learned that Hillary Clinton had jumped on that pandering bandwagon, and I thought better of Barack Obama, briefly, for opposing the asinine election-year tax break.

(Bear in mind that I was stuck in traffic, inhaling the fumes of Explorers and Escalades. Would it be that bad if we couldn't afford to drive as much?)

Then I heard the details.

Hillary modulated her call for tax relief with a call for a Congressional investigation of the spike in oil prices, suggesting the possibility of hanky-panky on the part of the oil companies. Remembering Enron, we must admit that hanky-panky is a real possibility -- but we also should remember that investigations tend to drag on and on until they accomplish nothing. (Case in point: the Enron investigation.)

As for Barack, my better thoughts of him evaporated when I heard he'd called for a "middle-class" tax break that would average out to about $1000 a year. Bear in mind that Barack's recent definition of "middle class" includes any household with an adjusted gross income of less that a quarter-million bucks per annum -- and that our outrageous national debt and the concomitant sinking dollar are largely responsible for the recent spike in oil prices.

My second hour on the LIE, happily, was spent listening to a Bloomberg News analyst interviewing former New York Governor Mario Cuomo -- in my book, the best Democratic orator since FDR. If I had my way, Cuomo would deliver the keynote address at this year's Democratic convention -- and it would be exactly the same address he delivered at the convention of 1984. If you don't remember his "Tale of Two Cities" speech, check it out here. Democrats were, indeed, Democrats back then.

Sadly, it's been all downhill since then.

I was wrong on that one!

I thought Obama wouldn't totally disavow Jeremiah Wright, but that was before I saw the Wrong Reverend's amazing performance at the National Press Club -- that is, before I realized that Wright is a total lunatic. Does he really believe the U.S. government created HIV as a plague on minorities? Hard to say for sure, but I think Obama was genuinely surprised when he saw the clips. If he'd known just how far over the edge Wright would go when bathed in the lights of the national news media, I'm sure he would have put a lot more distance between himself and his old political ally much earlier.

In truth, I was kind of amused that Wright accused Obama of political posturing in his campaign, since I'm convinced that it was political cupidity that drew Obama to Wright's church in the first place. Perhaps it's my personal prejudice, but I always find it hard to suspend disbelief when I hear a smart politician talking about his "spiritual needs." As we all know, church attendance is required for political success in this country, and so is facile hypocrisy.

By the way, just because I think Wright is nuts doesn't mean I think he's entirely wrong. A good part of black America might indeed be targets of genocide, albeit not by HIV. America's penchant for keeping black children undereducated and well supplied with drugs and handguns comes to mind -- something you might call genocide by neglect.

Will Obama emerge from the far side of the Wright debacle unscathed? Probably not, but I think he'll still be viable as a candidate. Time will tell.

Monday, April 28, 2008

The Wrong Reverend Wright

Well, I told you so.

Back here, I called your attention to the Sean Hannity interview of Reverend Jeremiah Wright. The broadcast networks hadn't noticed yet, and Wright coverage in the print media didn't exactly jump out at you. It seems the Obama campaign hoped it would just go away. It didn't.

When Wright's oratory went viral on YouTube and all the media began to pay attention, Obama had to respond. Nothing he could have said would have been good enough, of course. He couldn't totally disavow Wright without alienating his black base, and when you get right down to it, even a total disavowal wouldn't have done the trick -- he'd have appeared both disingenuous and disloyal.

Of course, he also couldn't say that he'd attended Wright's church to advance his political career in Chicago, where a Wright endorsement is a big plus. One of the biggest problems politicians face is that somebody who helps you today can turn out to be the proverbial albatross around your neck tomorrow.

Don't blame Hillary. She didn't create the Wright problem, she just accelerated it a bit. It's better for Barack to deal with it now, as best he can, before the Republican attack machine gets into high gear. After all, he'll still have to deal with the Tony Rezko mess, which hasn't gotten much play outside of Chicago yet (with the emphasis on "yet.")

Thursday, April 24, 2008

A new definition of "middle class"

I started listening to the Pennsylvania Democratic debate, but sometime during the American flag pin stupidity I turned it off. From what I read of the rest of it, I got just as much out of my Law and Order reruns.

I read about the tax policy pledges -- both Barack and Hillary say they won't raise taxes on the middle class, which they define as anybody earning less than a quarter-million dollars a year. Jesus H. Christ! The "middle," last time I checked, was about fifty grand a year. Granted, the quarter-million crowd doesn't qualify for inclusion among the super-rich -- the CEOs and hedge fund managers pulling in fifty times that much -- but they're still not going to worry too much about how to pay their kids' tuition for state college.

What were Barack and Hillary thinking? Oh, right. They were thinking the quarter-million crowd can afford to max out their political contributions. Well, let's just hope they "misspoke." While Bill was president, the top marginal tax rate was 39.6%, which probably was a pretty significant contributor to the balanced budget we had back then -- and certainly didn't do anything to slow economic growth. Was that so bad?

Taxation should not be a dirty word in American politics. Low taxation and the resulting high debt have trimmed the international value of the dollar by over 20% since 2003, and the rate of the dollar's fall looks to be accelerating. The prices of imports -- like all those goods we don't manufacture anymore -- are rising rapidly. Add higher prices for clothing, auto parts, electronics, appliances, and more to the rising costs of food and energy, and the real cost of living skyrockets even faster.

In case anyone's forgotten, when prices rise rapidly it's called inflation. Add that to the current recession and you've got stagflation. Yes, it's here already -- and the only reason the media can't seem to recognize it is because government cooks the books. Add food and energy back into the "market basket" used to calculate the CPI, and the inflation rate is around 12%. Add the "discouraged workers" and the people working part-time because they can't find full-time jobs to the roster of the unemployed, and the unemployment rate is close to 10%. Sounds like stagflation to me!

Are Clinton and Obama (not to mention McCain, who wants even more tax cuts) too dumb to realize this? If it's not stupidity, then it's the worst kind of pandering -- to voters who've been lied to for so long they're no longer capable of hearing the truth.

Friday, April 18, 2008

Elitist? Moi?

Those who know me may be surprised to learn that I'm not an elitist.

Really. I'm not. Granted, I seldom trouble to hide my sense of intellectual superiority to 99% of humanity, but that's not elitism. An elitist is somebody who identifies with an elite group, buying into a collective identity of group superiority.

Well, anybody as superior as I am wouldn't dream of buying into any sort of collective identity -- which is not to say that I'm incapable of identification. Hell, I cry at the movies. It's just that I identify with individuals -- lots of individuals -- but not with groups.

Anyway, that hardly matters because I'm not running for President. The guy with the elitism problem at the moment is Barack Obama, thanks to his "misstatements" at a gathering of true elitists in San Francisco.

Wha chu talkin' bout, Barack?

Here's my intellectually superior take on it: Obama resorted to elitist stereotyping of the great white proletariat as a way of assuring the rich liberal twits at his fundraiser that he is one of them, not just some clever young black man with big ears and a slightly unsavory Chicago past. Does he believe the stereotypes he spewed? Who can say? But if he really doesn't believe them, that doesn't make him innocent -- it just makes him dishonest.

Barack, though, probably has a pretty good idea of what he really believes -- unlike Hillary, who's spent entirely too many years with Bill. It's a genuine shame the rich liberal twits always get to decide who gets the Democratic nomination, because the Democratic Party is supposed to represent those of us who aren't rich. Well, that's life in 21st century America -- and as I've observed previously, I'd vote for Zippy the Chimp over John McCain.

Okay. If John McCain turns out to be our next President, it might not be all bad. Hell, Hoover wasn't all that bad because he cleared the path for FDR -- and we really don't need either Obama or Clinton: we need FDR!

(And, as my dead relatives used to say, I should live so long!)

Monday, April 14, 2008

Magical Thinking in Modern Economics

(This video runs 9 minutes 20 seconds, but your attention span is longer than that, right?)

Friday, April 11, 2008

Just more general outrage (and despair)

I haven't posted for a while, but not because I've ceased to be generally outraged. Actually, I may have gone beyond outrage -- I've been feeling sick. The same information available to me is available to everybody else, including, of course, our esteemed presidential contenders. Needless to say, I don't expect anything more from McCain than he's already delivered, and and that's just his prescription for the continued looting of America by the super-rich. Ho-hum.

I'd hoped for a bit more from the Democrats, but I'm accustomed to unfulfilled hopes. If hopes are things with feathers, mine have been to the taxidermist -- they won't fly. For all their blather about helping the middle class, neither Clinton nor Obama is saying anything that hints at any re-redistribution of wealth, reversing the upward redistribution that's been going on for the past quarter-century. There's nothing about making taxation genuinely progressive again, or about removing some of the for-profit private contractors who have been taking over the functions of government and getting rich on our tax dollars.

Actually, there was one ray of hope from Obama: he's called for removing the cap on payroll taxes, so that those with the six and seven figure salaries will be taxed at the same rate as your average stockboy or bus driver. My guess is that even if the Democrats win a large majority in both houses of Congress, it still won't happen, though. Those who serve in Congress, along with all their friends and relatives, are in that six-figure and up category.

Tuesday, April 1, 2008

Milton Friedman is dead...

...and it actually may be, at long last, time to bury him.

This recession will be around for a while. Badly burned by its criminally lax lending practices in recent years, the financial services industry is making credit hard to get, for both individuals and businesses. Giving investment banks access to the discount window may help a little, but the simple fact is that those who make policy for the industry have had a bad scare, and are likely to be overcautious for quite a while. Individual and institutional investors have seen their net worth nosedive, and some who might have been willing to take a few chances have their "liquid" assets tied up in auction-rate securities.

Consumer confidence has crashed, and shows no sign of picking up again. Combine that with the very high debt loads of so many families, and it becomes clear that America won't be spending itself out of recession any time soon. Small businesses that can't get the credit they need are failing, and larger businesses are cutting personnel. The picture is bleak.

I'm beginning to feel just a little bit optimistic.

Given the catastrophic consequences of the Bush binge of deregulation (and failure to exercise those regulatory powers that remain), the laissez-faire ideologues are struggling to hide the egg smeared all over their faces. Typically timid Democrats are starting to feel comfortable calling for government intervention in the economy -- an idea that would have brought waves of public mockery from all the "economic experts" just a year or two ago.

Treasury Secretary Henry Paulson has offered a plan for reforming our regulatory agencies. Needless to say, the plan of a Bush administration official and Wall Street insider wouldn't especially strengthen government's regulatory powers, but the very fact that he felt it was necessary to offer a plan is encouraging. The Paulson plan is recognition of the growing understanding that a failure to regulate was the cause of our current market failure.

Even though most Americans are economic illiterates, and have only the vaguest notion of what has gone wrong and what might be done about it, they know something is wrong. As the recession deepens, and the faces of TV commentators look more and more grim, America will become more and more receptive to populist appeals. If the Democrats have the guts to climb out from under the thumbs of their big contributors from the financial services industry (granted, a big if), they can start reconstructing the economic safeguards that were established during Roosevelt's New Deal and steadily eroded since the advent of "Reaganomics" in 1981.

It would help a lot, of course, if Clinton and Obama could start competing to see who can draw the most blood from John McCain rather than from each other. While a McCain presidency could make our economy so much worse that the eventual reaction to his neo-con policies would move America much further to the left, a genuine depression would be a heavy price to pay -- and we certainly can't afford to add any more rabid rightists to the Supreme Court.

Right now, we have the best opportunity in many years to restore the economic justice and stability we sacrificed for the sake of unrestricted economic growth. Now is the best time to begin narrowing the gap between the super-rich and the rest of us; create a climate favorable to organized labor; roll back the wave of overpriced, exploitative privatization.

Milton Friedman is dead, and now is our best chance to exorcise his ghost.