MacZad's Musings

I intended to write something about the current Fiscal Cliff struggle, but quickly realized that smarter men than I have been saying things relative to it for centuries. If only the GOP would read and heed.

"Government is instituted for the common good; for the protection, safety, prosperity, and happiness of the people; and not for profit, honor, or private interest of any one man, family, or class of men." ~ John Adams

"Experience demands that man is the only animal which devours his own kind, for I can apply no milder term to the general prey of the rich on the poor." ~ Thomas Jefferson

"If there are men in this country big enough to own the government of the United States, they are going to own it." ~ Woodrow Wilson

"There’s class warfare, all right, but it’s my class, the rich class, that’s making war, and we’re winning." ~ Warren Buffet

"The modern conservative is engaged in one of man's oldest exercises; the moral justification for selfishness." ~ John Kenneth Galbraith

"When plunder becomes a way of life for a group of men living together in society, they create for themselves in the course of time a legal system that authorizes it and a moral code that glorifies it." ~ Frederic Bastiat, (1801-1850) French economist, statesman, and author

"Power concedes nothing without a demand. It never did and it never will. Find out just what any people will quietly submit to and you have found out the exact measure of injustice and wrong which will be imposed upon them, and these will continue till they are resisted with either words or blows, or with both." ~ Frederick Douglass - American abolitionist, newspaper publisher, orator, author, statesman, and reformer

Categories: Opposing Plutocracy and Corporatocracy, Seeking Better Governance, Seeking Truth - Debunking Dogma

Below is the text of an e-mail letter that I have sent to the President with copies to my Senators and Representative.

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Dear Mr. President,

Please be very tough in negotiating a resolution of the "Fiscal Cliff." Your reelection has given you the upper hand and all of the Republicans' tax policy dogma is in shambles, and deep down they know it.

For 30 years the lobbyists for the corporations and the wealthy have successfully secured preferential policy and tax treatment for them. The result is exacerbated inequality between the top 1 or 2% and the rest of the nation. This is very unhealthy for a democracy; we're almost a Plutocracy.

This preferential treatment of wealth also reduced federal tax revenues far beyond what was prudent so now we have a "Fiscal Cliff." Since low revenue is the cause, it's logical that the first step in resolving the "Cliff" is to increase revenues by reversing the preferential policy and tax treatment that the corporations and the wealthy enjoy.

Reductions in government programs should only be considered if the tax receipts from drastic increases in the top tax rates, making the use of offshore tax havens more difficult and perhaps the removal of the cap on SS contributions fail to produce adequate revenue.

I am an ex-Republican and like many others I voted for you (and, for the first time in my life, a straight Democratic ticket) as the only hope of reducing the drift (Hell, it's not a drift, it's a rush) of the country toward Plutocracy. Please don't disappoint us. The wealthy have had their day (30 years worth), and it's time for government to aid the common man in regaining some stature.

Thank you for considering my views.

Regards,

Thomas A. McKee

Categories: Opposing Plutocracy and Corporatocracy, Seeking Better Governance

The "Fiscal Cliff" is a current hot topic with CNBC even moving from news reporting to mounting a "Rise Above"advocacy campaign spreading fear about what will happen if the problem isn't resolved by 1/1/2013. Other media are equally concerned about the need for action prior to falling off the "cliff," and most of the suggested solutions call for "shared sacrifice" - some kind of a balance between spending cuts aimed mainly at social programs and tax increases.

Well, I think that the media is spewing a lot of propaganda favorable to the very wealthy. First, the "cliff" really isn't one. Nothing drastic is going to happen on January 1 if no agreement is reached; there will be adequate time to make changes after that. Second, and far more important, the real causes of the crisis are being obscured and the solutions being considered aren't equitable.

What is going on here is a rear-guard action by those trying to maintain their favorable tax and policy treatment at the expense of the less fortunate. My Rise of Inequality Since 1980 posting clearly shows the almost unbelievable increase in income and wealth share enjoyed by those at the top mainly because of the favorable tax and policy treatment that their K Street lobbyists have secured for them. Over the years this has drastically reduced federal tax revenue making it a very significant factor contributing to the "Fiscal Cliff."

Now, to maintain as much of their advantage as possible, those at the top are proposing "shared sacrifice" where they grudgingly agree to a small tax increase (means a 95 ft. Yacht instead of a 100 ft. one) and poor Joe Schmo, who has worked much of his life shifting pallets around in a warehouse, is asked to give up some of his SS retirement - or some other sacrifice. Unfortunately, the conservative media (Fox News, et al) have done much demonizing of folks at the bottom like poor Joe erroneously casting them, rather than the tax avoiders at the top, as the main reason for the federal government's poor fiscal shape.

I'm sorry but making sacrifice by Joe a first step in a solution just doesn't wash with me. I know that this is naive, but the first order of business needs to be drastic changes in the tax code to get those at the top paying much more in taxes (means only a 75 ft. Yacht instead of a 100 ft. one) so as to begin to reverse the inequality that has arisen since 1980. That inequality is very unhealthy for our society as Joseph Stiglitz shows in his perceptive book "The Price of Inequality." Joe Schmo isn't a "taker;" he has worked hard all his life to earn those benefits. He should only be asked to sacrifice if the tax receipts from drastic increases in the top tax rates, making the use of offshore tax havens more difficult and perhaps the removal of the cap on SS contributions fail to produce adequate revenue.

The wealthy and their many apologists will say that such drastic increases in the top tax rates will kill motivation, innovation, investment and growth, but that's just more Plutocratic propaganda as the links below show.

Except at a very basic level motivation and innovation are not driven by $$. Big monetary rewards are only incidental to successful innovation not its cause.

The Congressional Research Service reports that a 65 year study shows that better growth has come when the top tax rates were the highest and that cutting top tax rates doesn't spur growth. (GOP legislators tried to suppress this report.)

How about all that investment by the wealthy that creates jobs? Paul Buchheit's #1 pretty well debunks that; there are some other interesting statistics on Paul's page as well. Further, the slow growth in the economy and jobs today is not due to a lack of investment $ to fund business expansion it's due to a lack of demand for products because not enough folks have the spare $ to spend. See: Who creates jobs? Surprise- we do.

The common viewpoint is that business and economic growth do better under GOP administrations and GOP policies, but this Forbes article shows the reverse to be true.

So all of the Plutocrat's arguments favoring the GOP's support for low taxes on the rich are nothing but false dogma. The acceptance of these ideas as truths is very detrimental to the country for our legislators can't make intelligent decisions based on falsehoods. Much pressure needs to be applied to our GOP legislators for it will be very difficult to get them to abandon this long-held dogma and help craft a solution to the "Fiscal Cliff" which does not place undue burdens on Joe Schmo and his ilk and which begin to reverse 30 years of inequality.

Some good supplemental information in these links:

YouTube Straight talk from Independent Senator Bernie Sanders Terrific! (Updated 11/25/2012)

Chart - Simplifies the Fiscal Cliff Resolution Choices (Updated 11/29/2012)

5 Ways Most Americans Are Blind to How Their Country Is Stacked for the Wealthy

It's Simple: Cutting the Deficit Will Kill Jobs and Hurt Growth; Taxing the Rich Won't

The U.S. Does Not Have a Spending Problem, We Have a Distribution Problem

The Giant Lie Trotted Out by Fiscal Conservatives Trying to Shred Social Security

Why the rich guys want to raise the retirement age.

YouTube animation of the Deficits & the Debt

Categories: Opposing Plutocracy and Corporatocracy, Seeking Better Governance, Seeking Truth - Debunking Dogma

On Nov. 6th millions of voters overcame the big bucks of the GOP Super PACs and reelected Barack Obama as President. They also elected Democratic Senators and Representatives who were opposed by the big GOP Super PACs. Overall, the big donors to GOP candidates got very little for the hundreds of millions that they spent.

Those supporting the SCOTUS decision can now say that the election results prove that the decision wasn't as detrimental to democracy as the critics declared when the decision was rendered. However, while the election results would seem to support that view it's an incorrect interpretation of the situation. In fact, the Citizens United decision is very detrimental.

Initially President Obama declared that he would not take Super PAC money, but as the campaign progressed he realized that he was being vastly outspent by the Romney campaign, and, in desperation, he reversed his decision and embraced the support of Super PACs, and donors came through with financial support for his campaign. Obama is a man of principle, but the realities of politics in a world where the Citizens United decision allowed his opponent such a financial advantage was just too much. So, though still opposed to Super PACs, the SCOTUS decision forced this good man to embrace something he abhors - that's both sad and corrosive.

Of course, big money in politics is always corrosive, and as noted in this earlier posting we need to be working to reverse Citizens United and make other changes to deemphasize the money and re-empower people in our democracy.

Categories: Opposing Plutocracy and Corporatocracy, Seeking Better Governance

My recent joining of Twitter ( @MacZad ), and likely too much time spent on it, has brought to my attention the thoughts of others which I would not have otherwise found. I'll share links to a few of the more interesting ones in this posting:

It's hard to imagine conservative economist Ben Stein calling for higher taxes on Fox News, Here's the dope from the Raw Story.

Watch this video to get the full story on the deficit chart above. It's devastating but note that only the last 3 years are on Obama's watch as the 2009 budget was set by the outgoing Bush administration.

Surprise, the normally conservative Forbes Magazine recently carried this article, "Want a Better Economy - History Says Vote Democrat!"

Here's Market Watch from the conservative Wall Street Journal with, "The Obama spending binge never happened," Government outlays rising at slowest pace since 1950s.

Forbes counters the idea that fewer will want to become doctors because of Obamacare with, "So Much For Obamacare Anxiety: Record Number Want To Become Doctors."

I haven't been able to figure out why so many of the 99% get taken in by the 1% and cast votes that continue the wealthy's domination of our country. Some thoughts about it in, "Republicans Twist Capitalism Into a Democracy Killer."

In this Common Dreams article Mark Morford highlights the rather large difference in the way that men and women view the presidential candidates: "Frightened Men Love Romney."

How the Private Sector Failed America by Hal Donahue makes the case that in the past a social contract fostered corporate-government cooperation which was good for the corporations and the country, but that the contract has been shattered and the country is decaying as a result.

Categories: Opposing Plutocracy and Corporatocracy, Seeking Better Governance

Mitt Romney touts his experience as a businessman and his rescue of the 2002 winter Olympic Games in Salt Lake. There's no question that Romney is a smart cookie. He has worked the system to the maximum to enrich himself and/or enhance his reputation, but in contrast to men like Henry Ford, HP's Bill Hewlett and Dave Packard, Intel's Andy Grove, Microsoft's Bill Gates or Apple's Steve Jobs all who built companies that provided employment to thousands and contributed to America's success, Mitt's business success was heavily dependent on financial manipulation which ended up driving companies into bankruptcy and destroying the jobs of thousands.

Let's take the Olympic Games rescue first via this quote from Rolling Stone:

--- Romney has[n't] done just fine at milking the government when it suits his purposes, the most obvious instance being the incredible $1.5 billion in aid he siphoned out of the U.S. Treasury as head of the 2002 Winter Olympics in Salt Lake – a sum greater than all federal spending for the previous seven U.S. Olympic games combined. Romney, the supposed fiscal conservative, blew through an average of $625,000 in taxpayer money per athlete – an astounding increase of 5,582 percent over the $11,000 average at the 1984 games in Los Angeles.

Remember the KB Toys an 86 year-old company with over 400 stores when it went into bankruptcy in 2008? Why the bankruptcy?

--- in 2000, right before Romney gave up his ownership stake in Bain Capital, the firm targeted KB Toys. --- Bain put up a mere $18 million to acquire KB Toys and got big banks to finance the remaining $302 million it needed. Less than a year and a half after the purchase, Bain decided to give itself a gift known as a "dividend recapitalization." The firm induced KB Toys to redeem $121 million in stock and take out more than $66 million in bank loans – $83 million of which went directly into the pockets of Bain's owners and investors, including Romney. "The dividend recap is like borrowing someone else's credit card to take out a cash advance, and then leaving them to pay it off," says Heather Slavkin Corzo, who monitors private equity takeovers as the senior legal policy adviser for the AFL-CIO. --- Bain ended up earning a return of at least 370 percent on the deal, while KB Toys fell into bankruptcy, saddled with millions in debt. KB's former parent company, Big Lots, alleged in bankruptcy court that Bain's "unjustified" return on the dividend recap was actually "900 percent in a mere 16 months."

Read the full of story of Mitt's business dealings in this Rolling Stone article, and another Rolling Stone article about how Romney got the government (us taxpayers) to foot the bill for the 1990 rescue of the then ailing Bain & Co., the original parent firm of Bain Capital.

You know, despite his shortcomings, I believe that voting for a former "community organizer" makes more sense for the future of our country than voting for a guy with Mitt's background and mindset.

Categories: Embracing Diversity and Tolerance, Illuminating Dark Places, Opposing Plutocracy and Corporatocracy, Seeking Better Governance

Years of corporate favoritism by our leaders and the 2010 Supreme Court's Citizens United decision allowing corporations unlimited spending to influence elections have given us a country pretty much as depicted by this flag:

So to paraphrase Lincoln, it's now, "---that government: of the corporations, by the corporations, for the corporations, shall not perish from the earth."

Here are some reforms that would help to get the citizens' influence in Washington somewhat equal to that of the corporations:

• Enact a constitutional amendment declaring that corporations do not have the same rights as people.
• Put real limits on the use of influence money by the K Street lobbying firms.
• Further limit the revolving doors that shuttle people between Washington and corporations.
• Take redistricting out of the hands of the politicians as California has done with its Citizens Redistricting Commission.
• Go to open primary elections like Washington State is using.
• Eliminate the Electoral College and go to popular election of the President.

These reforms are lofty and perhaps almost impossible to universally achieve, but as Washington state and California have shown reform is possible if the citizens keep pressing for it. The Center for Voting and Democracy is concerned with all aspects of voting, and has some good ideas beyond those mentioned above. Check them out and also their Blog. (Updated 10/08/2012)

Categories: Opposing Plutocracy and Corporatocracy, Seeking Better Governance

Though I'm not a member of any political party for years my vote went mostly to Republicans mainly because I believed that the Republicans had better fiscal policies.

The Bush years proved that idea to be dead wrong. Spending was higher (the money just went to different places) and taxes were cut with no regard for the mounting debt. Bush turned Clinton's budget surplus into historically-high deficit spending. In 2001, it took $250 dollars to buy one ounce of gold. By 2012, it was around $1700. The intrinsic value of gold didn't change; the insane fiscal policies of the Bush years were the major factor in causing the dollar to plummet approximately 85% relative to gold. You may not like the "tax-and-spend Democrats," but the "borrow-and-spend Republicans," who seem to believe that all problems can be cured by cutting taxes, are worse; they have saddled our children with stratospheric debt. Makes it hard to vote Republican.

There was also a disdain for effective regulation of anything during the Bush years, and the failure to regulate the financial industry was a major factor leading to the recent crash. After his bitter experience, the humbled former Federal Reserve chairman, Alan Greenspan, now understands that free markets (particularly financial ones) are not self-policing or self-correcting (i.e. without crashes) and that enforced regulations are required for markets to function best, both for the good of the market participants, and for the good of society. Unfortunately, one only has to listen to the current crop of ultra-conservative Republican leaders (like VP candidate Paul Ryan) to know that, unlike Greenspan, few learned any lessons from the crash as most are still espousing a little-regulated, and almost totally free-market, economy. Makes it hard to vote Republican.

Now that the Bush-era damage has been done, the current Republican leadership in Washington is giving belated attention to fiscal discipline (as exemplified by Paul Ryan's budget proposal), but, while it's clear that a smaller federal government is needed, their reform proposals fall inequitably on the backs of working Americans with little sharing of the pain by those at the top. It's true that spending under Obama has risen dramatically, but most of that increase has been (with congressional approval) an attempt to get the economy going again after the Bush-era induced 2008 financial crash. The inequity of their proposed reforms makes it hard to vote Republican.

The increasing concentration of income and wealth at the very top, that has been going on since about 1980, is not healthy for a representative democracy. It's clear that both political parties shared in much poor policy making that further empowered the Rent-Seekers thus exacerbating the inequity; it's also clear the Republican leadership doesn't see anything wrong with such inequity; it's the stuff of revolutions making it dangerous in the long run. Makes it hard to vote Republican.

The current Supreme Court with its conservative majority gave us its Citizens United decision which further empowered the corporations to spend as they please to influence elections thus effectively rendering the voice of the people impotent. It's one of the worst Supreme Court decisions ever for our representative democracy. The next president will likely get to appoint a justice or two to the court which could further entrench a pro-corporation majority. Makes it hard to vote Republican.

Finally, there are the social issues. The Republican party is now very strongly influenced by the conned fundamentalist Christians and as a result repressive social legislation is now a hallmark of their control. Makes it hard to vote Republican.

So the Republicans shouldn't be getting our votes in November. Obama has faults, but given the mess that he inherited from the Bush years and the pertinaciousness of the Republicans in congress, he's done a satisfactory job. He will definitely be better than Romney who will likely side with the Plutocrats (after all, he's a member) and oppose anything that would move us back toward a truly representative democracy - one where the voice of the people actually influences the legislation enacted.

Categories: Opposing Plutocracy and Corporatocracy, Seeking Better Governance

These 4 charts are but a few from the Center on Policy and Budget Priorities series on Examining Inequality Trends.

By presenting these charts I'm not advocating that the 99% undertake class warfare (though one might interpret the charts as showing that there has been class warfare and that the very rich have won). I am merely trying to bring to your attention the vast change that has taken place since 1980 and the principal reason for it. From the end of WW2 until about 1980 there was something of a social contract between labor, management and government, and though there were rough spots, on the whole those were good times for the populace; during those years even Republican presidents championed progressive legislation.

However, things began changing about 1980 resulting in the inequalities shown by the charts. While it's true that great fortunes were made in the computer and Internet industries during this period it's difficult to attribute all the growth in top income/wealth solely to that for there were big growth drivers (television, mass air travel, multi-car families, etc.) in the earlier period as well. However, even more significant are the many malevolent factors that have been at work in recent years.

A leading malevolent factor is Rent Seeking which has been exacerbated by the many laws and policies enacted at the behest of the corporations and the very wealthy. It's a "vicious circle" with each gain in income and wealth at the top increasing their ability to contribute to Republican politicians (more heavily than to Democrats) who in turn further tilt the playing field in their favor. They expect, and get, favorable treatment from all those lobbying and contribution dollars. Here's the great 7/29/12 Non Sequitur cartoon on the subject, and an earlier post with links to Wiley's other Congress-Man strips.

After 30 years of this we now have the plutocrats almost in full control of the political process. Many in both parties have been bought, and we have all but lost the enlightened society envisioned by our founders. Now we, the masses, must push back strongly to regain our representative democracy.

Categories: Opposing Plutocracy and Corporatocracy, Seeking Better Governance

This may be the biggest con ever, and it is worked over and over because it is so slick that many of the conned millions are happy about it, not realizing the economic losses that they and millions of others suffer because of it. Also important is the danger that the con poses to our religious freedom. Here’s how it works followed by comments on the economic damage that it is doing:

• Some of the wealthy and powerful (Koch brothers, Coors heirs, James Leininger et al) generously fund ultra-conservative groups.


• Many of these groups encourage the Christian fundamentalist churches to inflame their members on “hot-button” social issues (gay marriage is a current favorites) to get votes for conservative GOP candidates.


• The elected conservative legislators strongly support the interests of the big corporations and the rich and powerful by introducing and enacting legislation that is economically favorable to them but frequently unfavorable to the very folks who voted for them.


• To appease the religious fundamentalists on their social issues, some legislation favorable to their views is proposed and often enacted.


• Elated because of the legislators’ support for the very-visible social issues, most of the Christian faithful don’t notice the less-visible economic losses that they and others are suffering.

It’s wonderful for those who benefit. The big corporations and the wealthy get favorable government policy and tax treatment so the money keeps flowing to them with some of it continuing on to the ultra-conservative groups. The GOP legislators get the fundamentalists’ votes and reelection support from the rich and their ultra-conservative groups. The wealthy conservatives also know that those with the lowest incomes are more likely to belong to the fundamentalist churches that support GOP candidates, and their economic losses from the con helps to keep the big fundamentalist Christian voter base somewhat impoverished.

And even most of the conned faithful are happy; so what’s wrong here?

The con is a Robin Hood in reverse scheme fostering government policies (Rent-Seeking) that are biased in favor of big corporations and the wealthy. These government policies which shift costs from them to the public (the mass of taxpayers) and which unfairly divert even a few dollars per year from each of several hundred million Americans into the holdings of a wealthy few are morally wrong.

It really is a world-class con. For years it has siphoned dollars from working Americans, easily aggregating into the billions, and vastly enriched the wealthy. Additionally, as covered in an earlier posting, it is a strong contributor to the rise of Christian fundamentalism.

Categories: Illuminating Dark Places, Opposing Plutocracy and Corporatocracy, Seeking Better Governance

Billionaire Rupert Murdoch is splitting his News Corp., the parent of Fox News channel, into two companies. The publishing company will include the newspapers: the Wall Street Journal, the Times of London, the New York Post and the Australian. Curiously the Fox News channel will not be pared with the print newspapers but instead will be part of the entertainment company. While one may be entertained by the Fox News channel, using it as a source of political and social news results in one getting some very slanted views. Here's the Fox News reporting on two things relating to the federal budget:

On the April 8 edition of Fox News Channel's The O'Reilly Factor O'Reilly portrays federal funds for NPR and Planned Parenthood as un-affordable given the nation's debt. Some perspective: According to the Associated Press, NPR received about $5 million in federal funds in fiscal year 2010 and the Planned Parenthood annual report states that it received $487 Million In Government Funding in 2010. ----- Watch the short O'Reilly Factor clip

Now in contrast: When Fox News channel Happening Now anchor Jon Scott interviewed Wall Street Journal columnist Simon Constable on July 9, Scott dismissed the president's tax proposal because the money it raises would run the government for a mere "eight and a half days" just "a drop in the bucket." Some perspective: According to The New York Times, economists estimate that letting the Bush tax cuts expire for people above $250,000 as Obama proposes would generate $85 billion yearly. ----- Watch the short Happening Now clip

So, according to Fox News $492 million for two social/health programs is unfordable, but a $85 billion per year tax break for the wealthy is only "a drop in the bucket" in the federal budget picture. I'm concerned about reducing the nation's debt, but it needs to be done intelligently not just on the backs of working Americans. The Fox News "protect the wealthy" bias shown by these clips is blatant. They constitute only one example of many that could be cited to showcase the skill of Fox News in presenting the "news" to favor the Plutocrats. It's not the "big lie" but it leans toward it by skilfully using distortion, exaggeration, diversion and repetition. Repeated diversion of the viewer from issues which would negatively impact the wealthy to issues like "welfare abuse" seem to be particularly effective. However, there's hope; more of the public is catching on to these tactics, and Fox News viewership is falling.

BTW: At the end of the second clip Constable mentions getting back to the higher growth rates of the 1990s. Those were the Clinton years which didn't need those vaunted Bush era tax cuts to achieve better growth and which ended with a budget surplus.

Thanks to Media Matters for the clips from their excellent article - the inspiration for this post.

Here's more thanks to AlterNet: Greetings from Crazyland! 10 Instances of Fox Nation's Departure from Reality (Updated 11/28/2012)

The image below was just too good to pass up. (Updated 11/20/2012)

Image Credit: http://www.realamericanliberal.blogspot.com/

Categories: Illuminating Dark Places, Opposing Plutocracy and Corporatocracy, Seeking Better Governance, Seeking Truth - Debunking Dogma

Government regulation actually has two faces though only one of them gets hyped.

Big corporations cry that there's too much regulation, "Just free us from regulation and we'll create jobs," they say, which is bunk as job creation is not their forte. The regulations that they're referring to are those government rules that protect the health, environment, workers and public. What they are seeking is the shifting of costs from them to the public and taxpayers. However, it turns out that some of the regulations that they object to can actually save them money .

How about the other face of regulation, those rules that business doesn't talk about? Business really like the rules that the government promulgates at the behest of industry associations. While there are legitimate reasons for many of these, others simply limit competition by restricting entry into certain businesses or require citizens to purchase products or services that are of little or no benefit to them or society - only businesses benefit. Here are two fresh examples:

1. To comply with federal and state regulations residents with irrigation water meters in my town of 140,000 are required to have backflow devices (estimated installed cost - $200) and now to have them inspected annually at a cost of about $50. However, According to Causes of Outbreaks Associated with Drinking Water in the United States from 1971 to 2006 only one hundred and six people in the US died from all drinking water illnesses during that 35 year period or about 3 deaths per year. When the data in the report is further analyzed for deaths possibly related to backflow devices it turns out that these devices and inspections thereof will, at best, save one life in the town about every 8800 years. Don't you suspect that the Water and Wastewater Equipment Manufacturers Association and the American Backflow Prevention Association were instrumental in getting these regulations codified?


2. In North Carolina there was recently a legislative proposal to eliminate the requirement for motor vehicles less than 3 years old to undergo an annual safety inspection at a cost of $13.60 (or $30 if the emissions test is required). While it was clear to almost everyone that the inspection of new vehicles was unnecessary the owners of the safety inspection businesses objected to the change stating that it would hurt their businesses, and it was defeated. Update 8/3/12: I guess that I will have to find another example for despite the indication that it was defeated in committee this legislation was resurrected and passed.


3. Here's a quote from Bloombegr View's excellent article on restrictive state licensing laws: "The average cosmetologist in the U.S. trains for 372 days before earning a license. The average emergency medical technician spends 33 days in training. --- The disparity merely confirms what a muddle the process of occupational licensing is." Yup, it's the old story of using the states' power to limit competition; businesses love it. Update 9/30/12.

So the next time you hear the corporate world whining about too many regulations remember that their complaints are self-serving for they don't want to eliminate the many Rent-Seeking regulations that they helped create to benefit them.

Categories: Opposing Plutocracy and Corporatocracy, Seeking Better Governance

A recent post illuminated the workings of money as a motivator and how it fails when brainpower is essential to job performance.

Now the June 2012 issue of The Atlantic has an article, The Real Cause of the Crash, that focuses on Wall Street's financial incentives and how they endanger us.

It starts with this great cartoon:

And concludes with these two paragraphs which sum up the article very succinctly:

The problem on Wall Street has never been about the absolute amount of leverage, but rather about whether financiers have the right incentives to properly manage the risks they are taking. During Wall Street’s heyday, when these firms were private partnerships and each partner’s entire net worth was on the line every day, shared risk ensured a modicum of prudence even though leverage was often higher than 30-to-1. Not surprisingly, that prudence gave way to pure greed when, starting in 1970 and continuing through 2006, one Wall Street partnership after another became a public corporation—and the partnership culture gave way to a bonus culture, in which employees felt free to take huge risks with other people’s money in order to generate revenue and big bonuses.

People are pretty simple: they do what they are rewarded for doing. If they get multimillion-dollar bonuses by taking huge risks with other people’s money—as they still do—then they will continue to take those huge risks, and not give it another thought. To prevent another crisis, Wall Street’s top executives, bankers, and traders should once again have something close to their full net worth on the line every day—not just the portion represented by company stock or options—so that they will collectively take risk management more seriously. That’s a solution that has nothing to do with the amount of leverage on Wall Street’s balance sheets.

While there were undoubtedly other factors involved in causing the recent crash (i. e. faulty Federal Reserve policies - the subject of a future post), the article certainly makes it clear that the public ownership of the Wall Street firms resulted in large-scale gambling with other people’s money thus endangering the country's financial stability. It's a situation that cries for reform. Sadly, contribution money flows freely from Wall Street to the Washington leaders, and they don't seem to have the fortitude to reject it and undertake the necessary reforms.

Categories: Opposing Plutocracy and Corporatocracy, Seeking Better Governance

At the end of World War One the Allies imposed draconian reparations on Germany. That financial burden made life so tough for the German people that by the early 1930s they were thoroughly disillusioned and desperately searching for who to blame and for leadership that promised better times ahead. The leader they chose was Hitler with his fascism and, persuaded by his eloquent rhetoric, part of the blame was placed on the Jews. You know how it all ended.

Recently in the middle-east, and despite the armed solders in the streets, disillusionment boiled up into revolutions in several countries and resulted in the removal of their autocratic leaders. Now with austerity being imposed in Greece we are seeing the rise of extreme political groups there.

Here in our country the stirrings of disillusionment with the current plutocracy/corporatocracy have surfaced both on the right (Tea Party) and the left (Occupy Wall Street). The two groups place the blame differently but there is much in common about their concerns. At present both are on the fringes. However, unless true democracy begins to replace the current plutocracy/corporatocracy their numbers will grow dramatically and dangerously, for in the modern world it's easy for people to see gross inequity, and they know that they can successfully rebel against those causing it. If the rich and powerful continue to resist all reforms the coming rebellion will be ugly for them and perhaps for us all, for what follows a rebellion can be much worse than what was before. As with Hitler, disillusionment and rebellions often give those at the extremes a chance to grab power. Socialism would likely be too mild, but fascism, communism and autocracy are all possibilities.

Here's a quote that echoes this thinking. It's from the article "When Did the GOP Lose Touch With Reality?" by former Bush administration staffer David Frum.

The[se] Republican billionaires are not acting cynically. They watch Fox News too, and they're gripped by the same apocalyptic fears as the Republican base. In funding the tea-party movement, they are ­actually acting against their own longer-term interests, for it is the richest who have the most interest in political stability, which depends upon broad societal agreement that the existing distribution of rewards is fair and reasonable. If the social order comes to seem unjust to large numbers of people, what happens next will make Occupy Wall Street look like a street fair. The emphasis is mine.

The rich and powerful need an "enlightenment" and perhaps there is hope. More and more Republicans are questioning the party's current stubborn dedication to the plutocrats/corporatocrats. On the Democratic Party side there needs to be a disengagement from Wall Street and a return to the party's roots as the working man's friend, but much prodding from the working man will be needed before it happens.

Twitter ( @MacZad ) has just alerted me to the excellent Truthout Op Ed article on this subject. Well worth the read. (Updated 11/01/12)

Categories: Opposing Plutocracy and Corporatocracy, Seeking Better Governance

The Americans for Tax Reform leader Grover Norquist has stated, "Our goal is to shrink government to the size where we can drown it in a bathtub." The many lawmakers who have signed his anti-tax pledge have essentially delegated the tax legislating duties of their office to his Washington lobby.

When Norquist achieves success and we have government that "can drown in a bathtub," do we really expect that it will so improve our situations that we will be sharing this fat cat's chair, or even be sitting on smaller chairs on the platform beside him?

Not a chance! Norquist's success will give us an emaciated government and further concentrate power and wealth at the top. The rest of us will be like the Citizens United folks in the cartoon. Short of revolution a strong representative government is all there is that stands between us and total rule by the rich and powerful - just as they rule in non-democratic countries throughout the world.

None of us like taxes. However, they are essential and, while blind opposition to them may make us feel good in the short term, such opposition is not in our long-term best interest. Those who govern us need to be able to consider tax questions with an open mind, but those who have signed the pledge are not able to do so and don't deserve our votes.

So how about the candidates that you plan to support in November? Have they signed Norquist's pledge? Romney has and the vast majority of Republican and some Democratic congressmen have. However, there are indications that some prominent Republicans ( Examples: Jeb Bush and Lindsey Graham) are coming to realize that Norquist and his pledge aren't good for their party or the country.

Check'em out before you vote.

Categories: Opposing Plutocracy and Corporatocracy, Seeking Better Governance

We must begin the effort to take back our government from the plutocrats who now almost control it. It won't be an easy task, but it is an essential one if our country is ever to return to its former greatness. We need to understand the candidates positions on significant issues in this battle. Here are several questions for candidates in the November elections that should be asked by the media and in town hall meetings and televised debates.

• Do you believe that the Supreme Court's decision in the Citizens United case, which has allowed unlimited corporate money to flow into political campaigns, was in the best interest of the country? Any answer other than an unqualified no indicates a candidate undeserving of our votes. Further, will you pledge to vigorously support efforts for a constitutional amendment to negate this decision? Only a yes answer should garner our support.


• The Americans for Tax Reform leader Grover Norquist has stated, "Our goal is to shrink government to the size where we can drown it in a bathtub." Have you supported this goal by signing his anti-tax pledge? Lawmakers who have signed it have essentially delegated the tax legislating duties of their office to a Washington lobby; thus they are not fully-functioning legislators and don't deserve our votes.


• Prior to the 2008 financial crash the prevailing wisdom was that markets were self correcting and no government regulation of them was required. If that was your view prior to the crash, do you still adhere to that view? A yes answer indicates a candidate still wedded to a failed economic philosophy. Further, will you pledge to support the drastic reforms that still have not been taken to assure that the 2008 debacle isn't repeated? To receive our support a yes answer should be required.


• Do you mostly agree with this statement: Wall Street has strayed from its original mission of helping to finance American business and instead has become the site of giant gambling and extortion operations whose main goal seems to be siphoning as much as possible from the economy? A no answer probably indicates a candidate deeply dependent on Wall Street contributions and undeserving of our support. Further, will you pledge to support the strong reforms necessary to return Wall Street to its original mission? Answering yes should be a requirement for our votes.


• How old do you believe the earth to be? Any answer other than an unqualified "billions of years" indicated a candidate with such a warped sense of reality that he/she is unfit to govern and is undeserving of our votes.

Categories: Opposing Plutocracy and Corporatocracy, Seeking Better Governance

I have recently finished reading two books significant to America's future:

Greedy Bastards by Dylan Ratigan - Simon & Schuster - 2012, $25.00, 245 Pages

If you care about your country's future this book is a must read! It's a rant, but a rant is what's called for. Buy it or get it from the library. Ratigan is mad about our situation. Reading it will make you as mad about it as he is, and will give you some ideas about what we can do to get out country back on the right track.

He tackles several of the things that have been bothering me and offers solutions. No fluff or padding - fairly solid content all the way through. Suggests 4 core values that he calls VICI: Visibility, Integrity, Choice and Interests. His marketplace example using cups could have been better, but otherwise he's right on target. The need for a constitutional amendment declaring that corporations are not people is the central thesis of the book, and he has established united re:public to further the idea which, surprisingly, is also gaining traction with Some Washington lawmakers. If you want more detail about the book's content read this Seeking Alpha review.

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Why Nations Fail by Daron Acemoglu & James A. Robinson - Crown Publishers - 2012, $30.00, 529 Pages

I wish that I could recommend reading this excellent book for the authors obviously have much time and thought invested in it, and it's a very significant contribution to economic understanding. However, it's far too long - should have been no more than 200 pages, and I can't recommend reading it. Here's my take on what you need to know:

The book's compelling central thesis is that nations fail because: (1) their politics favor a small group of elites and the status quo - there's little or no creative destruction and the old businesses and organizations survive long past the time when they should have been replaced by the new, and/or (2) they lack sufficient central control over the country. These weak countries have extractive governments, and it seems to be hard mold to break out of for in most of these countries the money piles up in Swiss bank accounts while the populace suffers through one extractive regime after another. The authors aren't very optimistic about the possibility of meaningful change in most of the extractive countries. (Number 2 above would seem to doom Afghanistan despite all our efforts.) In contrast inclusive (pluralistic) governments (US, Britain, France, etc) seem to be almost happy accidents with just the right things having happened at the right times in history to make broad-based governance possible. If you want more detail here's Bloomberg's review.

How lucky we are to live in one of the inclusive societies! However, in our country the extractors (sometimes called rent-seekers) have been hard at work for the past 30+ years bending government policies to their liking so we are slowly becoming an extractive society - our "corps of plutocratic elites" is already in almost full control. This quote on the book's the applicability to the US is from Tom Freedman's review: "Acemoglu worries that our huge growth in economic inequality is undermining the inclusiveness of America’s institutions, too. 'The real problem is that economic inequality, when it becomes this large, translates into political inequality.' When one person can write a check to finance your whole campaign, how inclusive will you be as an elected official to listen to competing voices?"

Categories: Opposing Plutocracy and Corporatocracy, Seeking Better Governance

"Those who don't like government aren't very good at it." I once read this but don't know its author.

The need for a somewhat smaller, more efficient a less debt ridden federal government is clear to me. However the question here is: Do we want an emaciated federal government?

The current deficit reduction push by GOP Congressman Paul Ryan is a hypocritical effort that has different real objectives. They are the objectives of Grover Norquist and his Americans for Tax Reform: "Our goal is to shrink government to the size where we can drown it in a bathtub."

Hypocritical Ryan - such a late comer to fiscal discipline. During the Bush administration Ryan had no qualms about the spending on a grand scale that led to Obama inheriting a country in something of a fiscal mess.    

Here from the Washington Monthly - Political Animal Blog is a quote that elaborates on Ryan's real objectives better than I can:

"The important thing to grasp here is that for all the talk about Paul Ryan being the “adult in the room” who understands the “tough choices” needed to confront the “debt crisis,” everything we know about him suggests that fiscal probity is at best a third-order motive for his proposals to decimate the social safety net. More important to him is that the spending cuts he supports are necessary to finance still more regressive tax cuts, and furthermore, are positive social measures in and of themselves. Like the pirate Ragnar Danneskjold, a character in Ryan’s favorite book Atlas Shrugged, who sinks aid ships as a moral gesture aimed at the “looting” of the successful, Ryan would object to safety net programs even if the federal budget was in surplus:

“It is not enough to say that President Obama’s taxes are too big or the health-care plan doesn’t work for this or that policy reason,” Ryan said in 2009. “It is the morality of what is occurring right now, and how it offends the morality of individuals working toward their own free will to produce, to achieve, to succeed, that is under attack, and it is that what I think Ayn Rand would be commenting on.” Ryan’s philosophical opposition to a government that forces the “makers” to subsidize the “takers”—terms he still employs—is foundational; the policy details are secondary."

So Ryan is a disciple of Ayn Rand's rugged individualism and free-market unbridled capitalism, as were Milton Friedman, Alan Greenspan, et al - an economic philosophy which gave us the recent financial crisis. The crisis has given Greenspan second thoughts, but not Ryan whose only qualm about Rand is that he has recently discovered that she was an atheist so he is now trying to distance himself from her, but clearly not from her philosophy. BTW: Rand herself, late in life, participated in Social Security and Medicare those government safety-net programs that she so hated.

The bottom line for me is that I value many federal government activities (we could be much less interventionalist in world affairs), and I must speak out against those who want an emaciated government that would gut environmental regulations, sell the national parks, enact more regressive taxes etc., and thus give us even more of a plutocracy than we now have. We can't vote against Norquist, but we can vote against Ryan and other Ayn Rand disciples.

Categories: Opposing Plutocracy and Corporatocracy, Seeking Better Governance, Seeking Truth - Debunking Dogma

We hear a lot these days about the vast difference in income and assets between the 1% and the 99%. (Graphs here and here ) Of course, the rich have always had higher incomes, and that's not necessarily bad. However, the use of wealth and the power it bestows to relentlessly lobby for favorable government policy and tax treatment to further skew the distribution of income upward is wrong. This has been going on for at least three decades and has resulted in our democracy essentially becoming a plutocracy - rule by the wealthy.

We, the 99%, have allowed this to happen: (1) by a disinterest in the political process - who wins Saturday's game, the American Idol competition or social websites get far more attention than politics and elections, (2) by a failure to vote in primary elections thus allowing those on the political fringes to go on to success in the main elections, and (3) by giving social issues, not economic ones, the greater weight in our political decision making process. 

However, there are signs of hope. The Occupy Wall Street movement put the frustrations on the front pages, but was unlikely to be successful. More likely to begin reversing the situation is the movement underway to amend the constitution to declare that corporations are not people.

You can be fairly sure that the plutocrats' aren't on Facebook or concerned with Saturday's game or the latest Idol winner. They're focused on directing their lobbying dollars to those politicians most likely to help them maintain and advance their favored position. To counteract the plutocrats and restore our democracy the rest of us need to be pushing back. We can start by giving economic and political issues more attention.

Food for thought about issues that matter will be the main thrust of future posts. 

Categories: Opposing Plutocracy and Corporatocracy, Seeking Better Governance

Those at the top are saying don't tax us, we're the job creators, and small business owners say the same. Well, there's little truth here as neither of them are the great engines of job creation that they claim to be.

The mom and pop businesses at the bottom don't create jobs because they usually don't have any employees; they're just one or two person operations often started by people laid off and unable to find new positions. In the large firms, where I have some experience, the upper managers are obsessed with headcount - how to keep it down!

If any segment of industry can claim to create jobs, it's the middle-sized companies that have the best claim. According to this Entrepreneur article from 2007 to 2010, the mid-market companies added 2.2 million jobs, while big businesses cut 3.7 million jobs.

However, even the middle-sized companies claim is weak for companies, of any size, don't just create jobs out of thin air. It takes market demand for a company's products or services to lead to job creation. At my old employer employees were added when product sales were strong and laid off when sales were weak, and that's generally the case at all companies.

So what does all this say about government policies - tax and other? To me it says that rebuilding the infrastructure would be good and that other good policies for job creation would be those that enable a broad segment of the population to purchase more goods and services. In other words, policies that reverse the high percentage of income going to the top few percent and spread it more broadly. The upper 1% aren't going to purchase many Harley-Davidson "hogs," but the other 99% will. Here's a businessman making this case much more compellingly than I ever could:

This great 6 minute Nick Hanauer TED talk on this subject is a must-watch video.

These ideas suggest income redistribution - a hot-button subject for many, but the gaming of the system in the past 30+ years that has so strongly skewed the flow to the upper end has to be reversed if our country is to ever return to its former greatness. I'll have more on this in later posts.

Update 11/01/12: Via Twitter ( @MacZad ) I have become aware of this great article which solidly debunks the myth that tax cuts for the rich create jobs; in fact they create bubbles. Read it! It makes the point much more solidly than I have done here.

Categories: Opposing Plutocracy and Corporatocracy, Seeking Better Governance