Wednesday, June 29, 2011

Short-term Profits, Long-term Disaster

"He plants trees to benefit another generation," quoted by Cicero.

American corporations don't think like this. At most, they plan ahead for the next quarter, or the next year. Speculators and large Wall Street firms gamble to exploit people's misfortunes, they don't plan ahead to help others (only themselves).

The issue of fracking is illustrative of how this works. Natural gas producers are flocking to fracking, because there appears to be an abundance of gas in a large number of enormous shale deposits deep in the earth. However, fracking requires two things that make it potentially damaging to huge numbers of people. One landowner could sell drilling rights on his land to a drilling company, but the company, after drilling down about a mile, turns the drill bit horizontal, so one surface well could have impact on people for miles around, even if all of them oppose drilling under all circumstances.

And what is the impact?

Once the wells are drilled, both vertically and horizontally, the producer pumps in a toxic stew at high pressure to fracture (hence, to frack) the shale formation in which the gas has been trapped. The drillers claim there is no danger from the toxics--they pump them out again--but no one can guarantee they won't end up in our drinking water, either from natural upward flow, or from unintended spills. This is a short-term venture that could spoil a long-term resource that is not only in short supply, it's essential to life. Many civilizations have foundered when they destroyed, or lost, their water supply. The Mughal city of Fatehpur Sikri was abandoned shortly after it was completed; it had too little water. Mayan cities disappeared for the same reason. The Romans piped water in North Africa from the southern mountains: Islamic extremists destroyed them and with the aqueducts the agricultural resources of the whole region.

Fracking oil companies act like these ancient doomed civilizations: short-term thinking only, in pursuit profits.

All this is to say: business will pursue fracking because they can make short-term profits and either: 1) they believe all the complaints about adverse effects are wrong, or 2) they're betting they'll do no damage, or 3) any damage they do won't appear until they've extracted their profits and gotten out.

In New York State, frackers have been pouring money into the legislature to prevent a moratorium, or to limit its duration. Yet, the Marcellus shale region undergirds almost all the water resources needed by New York City in its extensive reservoir system. If natural gas, or worse, the frackers' injection fluids pollute those reservoirs, New York, our financial and cultural capital, might have to be abandoned like Fatehpur Sikri, or those Mayan cities. This is just plain stupid; especially since frack wells don't last as long as conventional ones.

Instead of 'do no harm,' modern corporations appear to believe in 'do harm' if there's profit in it.

Friday, June 24, 2011

Nowhere Near Enough

Thirty-three thousand over more than two years; ten thousand this year. When you consider the numbers of troops involved (about 100,000) that Obama proposes is certainly not a rapid withdrawal from Afghanistan--and yet it's more than the "military wanted."

More than "the military wanted." Do you get it? Barack Obama is not Commander in Chief: David Petraeus is. He set out the "options," and the only gesture made towards popular opinion, especially towards Obama's 2008 supporters, is that Barack chooses the "option" that draws down the troops a little faster than the military would like. Maybe even that takes courage, given how dominant the military has become. The President was elected on a groundswell of get-us-out sentiment vis a vis Iraq, and secondarily, Afghanistan. Obama's main focus re Afghanistan was about stopping al Qaeda.

In his speech, Obama made no implied criticism of spending $2 billion a week on sustaining the Afghan war and the corrupt government we put into power there. Yet, he proposes only a 10% cut in the number of troops, even if Obama said the right things about rebuilding America, instead of some foreign country. We'll still be spending about $1.8 billion per week on this senseless war. Meanwhile, honeyed demands rise for cutting Medicare, Medicaid and Social Security, to pay for the deficits incurred by our imperial overreach.

What do we get out of the Afghan war? Are we safer? Osama bin Laden was killed in Pakistan not Afghanistan, The Afghan government is almost mythically corrupt. Our man, President Karzai, keeps on making noises about not wanting us there: if he honestly said what he wanted--continued American presence so that he could continue to rip us off--Afghans and Americans would both be dismayed. Karzai is dependent on our largesse, not just because it enriches him, but because it gives him extraordinary means to pay off his followers.

The economy of Afghanistan appears to be largely dependent upon American/NATO aid and opium sales, and it's still one of the poorest nations on the planet.

More and more Americans are agreeing that we shouldn't be going into debt to "develop" or pacify Afghanistan, when we don't have enough money for our own schools, or our retirees.

Obama's decision is clearly too little, too slow and too obeisant to his military overlords, who don't mind if they impoverish and then bankrupt the rest of us.

Would even Ron Paul, or Russ Feingold do any better if either were President? Or would the military overawe them, too? It seems likely, but then neither would be able to get elected, anyway.

What has been emerging since Reagan, at least, is a military that is NOT really subject to civilian control--although it still keeps up appearances. While the generals don't interfere with domestic policy, they have gained a stranglehold on military policy/foreign policy. They will drive the American empire either to Armageddon, or more likely, to bankruptcy.

Monday, June 20, 2011

All Temples Fall


The military has all but taken over war policy; it is determined to preserve American dominance, regardless. The cost of empire is now finally becoming plain: Medicare, Social Security, Medicaid, and much more.

Nations that have never been empires don't spend more than half their discretionary budgets on "Defense." Instead, they spend to make their people better off. Does spending three-quarters of a trillion dollars a year on war-making give Americans better lives? It's spent all over the world by our generals, trying to maintain dominance. Germany learned through bitter defeat, but Germany, today has universal healthcare and lower unemployment than they had before the Great Recession; they aren't spending their substance on foreign wars.

Americans spend $750+ billions on the most deadly killing machine the planet has ever seen: our military. So, they bomb Afghanistan. Are we better off? We help in bombing Libya, while our generals work hard to persuade Afghans and Iraqis that American troops should stay in their countries indefinitely, even if they do bomb the occasional wedding procession, or informal gathering.

Why does Karzai, originally American-sponsored, want Americans to stay? He wants Americans because he can siphon billions off us, for him, for his family, for his cronies, for his allies bought and paid for. Can he really believe that more years of war are better for his people than a settlement? The Taliban has a central demand, which, for nationalists makes sense: any settlement must require that US and NATO forces leave. Our negotiators refuse to discuss withdrawal, but demand the Taliban submit to "the constitution," which was written with American guidance. Why not negotiate when to leave, and what to get in return and negotiate how to work under the present constitution?

American generals don't want to leave Afghanistan: it's a moneymaker, as well as an opportunity for promotion, power and cushy jobs after retirement. The same goes for Iraq, and for any of the 120+ countries in which we have a presence.

Wall Street promotes empire, too, because of the money it can make from war, and so does the media. Until recently, no one cared whether we had to go into hock to maintain "full-spectrum dominance."

At least, the "budget warriors" are beginning to realize: useless wars cost too much. Who is hurt by empire? Anyone affected by all the cuts to programs aiding them, or the taxes they have to pay for useless wars. Few in power stand up to the generals and say "No!"

But the generals are determined: they desperately hold on; they don't care if America can't afford it. They'll bankrupt and impoverish us to get their way.

All temples fall," Elizabeth Cunningham sings. All empires do, too. Elizabeth will sing this song when she promotes her upcoming Red-robed Priestess the last of her Maeve Chronicles, set during Boudicca's rebellion against Rome. But it's happening now with the American Empire.

Monday, June 13, 2011

First They Came for the Jews

First they came for the Jews and I did not speak out because I was not a Jew.
Then they came for the Communists and I did not speak out because I was not a Communist. Then they came for the trade unionists and I did not speak out because I was not a trade unionist. Then they came for me and there was no one left to speak out for me.



The above was written by Pastor Niemoller protesting the Nazis after millions of Jews were gassed and he was nearly executed. Now, similar things are beginning to happen, a step at a time, here in the US and abroad, under US aegis. First, foreigners are detained arbitrarily, then American citizens, even tortured, held for years with no charges, held in solitary, force-fed if they protest their illegal imprisonment with hunger strikes. It's not only Bradley Manning and Abdullah al Kidd, but hundreds of others.

While we may sign petitions, and while some protest in the streets, the screws only get tighter: we are marching rapidly towards a police state. What's scary is that Obama's election appears to have accelerated the process, but his next electoral opponent would likely be even worse.

Guantanamo is not closed, Bagram has expanded rapidly, "super-max"-security prisons proliferate in the US, routine solitary confinement goes viral, while ordinary citizens are subjected to intrusive searches in airports. Furthermore, Abdullah al Kidd, the Supreme Court has ruled, cannot sue former US-AG John Ashcroft for wrongful detention, and as Daniel Ellsberg (of Pentagon Papers fame) has noted, now everything Nixon did to him (like breaking into his psychiatrist's office for blackmail material) is now legal.

The creep of surveillance in this supposedly democratic nation has reached the point in which no one is safe and virtually anyone can be watched. Given our more highly developed communications technology, surveillance is also easier.

The government has been given the legal legs through the just renewed Patriot Act to continue and expand its Big Brother activity, but even private corporations like Progressive Insurance are pushing new versions of surveillance: Progressive will discount rates for customers who submit to electronic monitoring of their "driving habits." Ironic name, right? The states also get into the business: a friend was mailed a speeding ticket, after Easy-Pass monitored his speed from Great Barrington to Boston on the Mass Pike!

The protest against full body scanners (also referred to as 'porno-scanners') has pretty much died down. Either you go through them at the airport, or a TSA officer will feel you up--all for "security" reasons.

Why do Americans passively allow these outrages? As Ben Franklin noted: "Those who would give up ESSENTIAL LIBERTY to purchase a little TEMPORARY SAFETY, deserve neither LIBERTY nor SAFETY."

The American Empire, like the Roman one, has jettisoned both--even for our equivalent of Roman Senators, like Congressman Weiner and ex-Governor Spitzer.

Saturday, June 11, 2011

Our Debt Trap

The "new" economy: workers have no rights, and are paid a few dollars over minimum wage. They have to pay for an American lifestyle: a decent rental, at very least, a car, insurance and gas, cable and phone, electricity, medical care and food, going up almost as fast as gas.

I have friends who are barely making it, working full time; they're good at what they do, highly valued by their employers, yet they're paid too little to afford the minimal American lifestyle.

Prices go up, although Bernanke tells us we don't have meaningful inflation, that deflation is the danger. Deflation is a danger, not just in the housing market, where prices are marching downward, but in the labor market. Workers are paid less and less, because everything, including rent, goes up--except their wages. The result is that people have less and less money to spend; they economize. In the country, people only drive to the store when they have multiple tasks; gas costs too much for multiple shopping trips, so there is less money as demand for goods and services.

Meanwhile, corporations are sitting on piles of cash, much of it from foreign earnings, and from squeezing more work out of fewer workers. The rise in unemployment (from 8.8% to 9.1%) is driven by labor deflation, i.e. people don't have enough money to maintain the demand necessary for businesses (small and large) to hire more workers.

No tax cuts for corporations and wealthy investors will stimulate job creation when there is flagging demand for the goods and services those businesses sell. No lay offs of public employees (Federal, state and local) is going to create more jobs; the opposite is true; layoffs drive demand downward.

Two policies would create jobs: resolving the housing collapse by allowing people to stay in their homes and renegotiating mortgages based on their homes' current value, and/or subsidizing housing payments. And, government creating needed jobs directly. Our crumbling infrastructure alone indicates that WPA-type jobs would be positive investments in the nation's future. It doesn't matter where the money comes from, but only the Federal government can make a political decision to invest in jobs.

Instead, governments slash jobs and spending, suddenly reducing money available for goods and services. The result is a debt trap. Fewer jobs mean less money being spent. This results in lower tax revenue and higher expenditures on services to the unemployed, which then forces cuts of even more jobs. This self-reinforcing deflation, is a debt trap. Deficits will rise as expenditures are cut; debt will increase as unemployment rises and as people spend less. That's not a paradox, it's how things work.

Rome was caught in a debt trap in the 4th century--and never got out of it. Keynes and FDR found a way out in the 1930's. Why don't we?

Saturday, June 4, 2011

What's Wrong with GOP's Hensarling?

Texas Congressman (R) Jeb Hensarling proclaimed: "one of the biggest impediments to job creation today…is a lack of confidence in the future." He blamed this on "an administration where regulators have gone wild…threatening the largest single tax increase in America’s history and…[it] doesn’t take seriously the debt that is threatening our job creators.” [NYT 6/4/11]

What's wrong with this picture? Regulators have gone wild? Polluters went wild under Bush, speculators went wild; banks went wild, causing the recession. The "tax increase" Hensarling mentions, is the expiration of Bush's unfunded top-rate tax cuts. Tax rates for millionaires are lower now than at any time since 1929 and income inequality is higher.

Who are "job creators?" People who put up the money? Neither large corporations nor entrepreneurs are hiring. This is because employers do not "create" jobs. In order for hiring to happen, there has to be demand (or its potential) for goods or services in the economy (demand is not created by the employer), and there have to be people with the requisite skills to fill the jobs needed (provided by good schools). Entrepreneurs take advantage of many things they don't create: people, skills, demand, a legal system, and basic security.

Imbedded in that legal system are regulations, which establish a predictable marketplace. They also force businesses to compensate for damages to society. Polluters, for example, either pay the costs their pollution caused to society, or society has to pay it instead: in poorer health, a major cost. Why should a polluter profit from the lung cancer he causes in a hundred victims downwind?

As for debt: the greatest part of the debt Republicans like Hensarling rail about was caused by: two Bush tax-cuts, two unfunded wars and an unfunded mandate added to Medicare (Part D) by Bush and his Republican Congress. Then, to the debt was added the Great Recession caused by the lack of regulation which culminated with Bush, but had been building since Carter.

In recessions, governments take in less (in revenue) but have to spend more (for things like unemployment payments and Food Stamps), unless they're going to revert to a Dickensian age when people starved in the streets. Our experience in the Depression demonstrated that government programs (contrary to conservative dogma) created jobs, value and demand, and started the US climb out of the Depression--not completed until the massive deficit spending necessary to wage WWII.

Cutting spending does not create jobs, as evidenced by the rise in unemployed state and federal workers here, and renewed recession in budget-cutting UK. But it does increase inequality, and therefore the power of the extremely wealthy, our equivalent of the Senators of Fifth Century Rome.

Those Senators did much the same thing, weakening Rome, laying the stage for its fall, in 476.

Friday, June 3, 2011

We Won't Pay!


The Portuguese Communist Party is campaigning against the Euro-IMF bailout; their slogan: "We won't pay!"

It makes sense in the US, too. Who caused the global recession, and what is causing the world economy to lean towards a renewal of it? The banks speculated and committed fraud on all of us, and got away with it--at our expense. The American economy is limping towards a "double-dip" in part because of all the government cutbacks (federal, state and local). It's also because jobs in the private sector are not returning; there was too little stimulus--except for the trillions thrown at Wall Street.

In Greece, Ireland and Portugal, the bankers demand huge cutbacks to services, pensions, any public expenditure, but it was the bankers who caused the crisis, yet the banks are not being asked to pay for it. The bailouts will probably doom those countries to continued recession; their governments won't be allowed to re-stimulate their economies.

The US may be doomed as well, by political shortsightedness, greed, ideological blindness and the overweening power of the Selfish Class, our contemporary Roman Senators.

When you have persistent unemployment rates (officially now 9.1% and unofficially 16-18%), with wages flat and workers scared, you are not going to have expansive demand. Without growing demand, corporations are not going to hire, whether their taxes are raised or lowered. Corporations have been sitting on piles of money and neither hiring, nor investing.

Ordinary people have been left in the lurch. Any commitment on the part of the Obama administration to stimulate hiring, or to aid the housing market by mortgage reform has been abandoned in the face of Republican demands. Impose the same kind of draconian cuts and restructuring as the IMF: huge cuts in services, pensions (like Social Security and Medicare) and jobs, to pay for the debts incurred by the finance nightmare, two unfunded wars and a series of unfunded tax cuts that have enriched a tiny 1% of the nation.

We are told that the US is broke; it's not. The problem is that the wealthy and the corporations are looting the nation--as they looted Portugal and Greece--and they have the political clout (and paid media support) to persuade the political elite, that massive cutbacks are necessary--on others' backs. They even insist, via Republicans like Ryan, that they are over-taxed; the opposite is true.

Many corporations avoid paying any taxes, despite huge profits; many wealthy find enough loopholes, too, to reduce their already low, 33% top tax rate. In the booming 50's, the top rate was 91%, and it was still 70% in the prosperous 1960's.

Shout: "Hell no! We won't pay!" The people and corporations who created this mess should pay for it. Governments should create jobs with their money. To accept the cutbacks is to reinforce the takeover by our Roman Senators. We'll retreat to Fifth Century society made up of Senators and serfs.

Wednesday, June 1, 2011

Who Controls This "Democracy"?

Polls show that Americans want to preserve Medicare; they favor raising taxes on the "rich" and corporations, they want us out of Iraq and Afghanistan and at least a bare majority prefer cutting Defense spending to control the budget.

Yet pundits, experts, politicians and decision-makers all propose the opposite: cut taxes on the wealthy, revamp or cut Medicare, urge Iraqis to keep American troops after 2012, and minimize any withdrawal from Afghanistan.

Among the in-crowd in Washington and the major media markets, the burning question of the day is: how to cut the deficit and the debt. Beyond the beltway, where most people live, the deficit isn't the problem: it's jobs.

Nine percent unemployment implies 91% employed, so most are still working--non-workers are not counted. Given declining demand driven by the double-dip housing market and the fall in demand for workers, a large proportion of those employed fear lay-offs and therefore put up with speed-ups, increased workloads, longer hours and stagnant wages. Further, unions are so weak they can't even keep their members' wages abreast of escalating costs of living.

But Republicans ignore the jobs issue, after using it to gain power in Congress in 2010: everyone they know is doing pretty well. Just ignore all that whining about jobs. Eliminate all social programs like Medicare, instead.

Obama is only marginally better.

The debate on alternative budgets demonstrates how skewed our public dialogue has become. It leaves out the only proposed budget to truly cut the deficit, reduce the debt and create jobs. Why is GOP Ryan's budget proposal considered the only serious alternative to Obama's? It would replace Medicare with vouchers and block grants for Medicaid, and wouldn't significantly cut deficits; it might actually raise them, because of Ryan's tax cuts for the wealthy. Yet, it's considered serious. Obama's budget freezes Federal pay, cuts Food stamps, finds savings in Medicare and Medicaid cut-backs and greater efficiencies in health care, and nominally cuts Defense. Obama doesn't raise taxes on the wealthy until after 2012, and he doesn't significantly cut the deficit, either.

The Congressional Progressive Caucus's budget raises income taxes and estate taxes for the top 1% of earners, on high-earners' payroll taxes and corporate taxes, while capital gains are taxed as ordinary income. It cuts healthcare costs through negotiating Medicare pharmaceutical prices, better management and by adding a public option. It cuts defense by bringing the troops home and shifting defense priorities. It also invests $1.66 trillion in job creation, infrastructure and alternative energy. Progressives claim they'd achieve a budget surplus of $30.7 billion by 2021.

So, why isn't it considered a "serious" alternative? Oh, it's only what the people want, but the public "debate" doesn't include what people want, only what the elite wants. They want to enrich themselves at everyone else's expense, like the Roman Senators in the Fifth Century. If they succeed, we'll have a declining empire, mass impoverishment and no democracy.