Tag Archives: politics

Righteous Anger Management

I’ve been really busy lately and subsequently have not been blogging. I have been accumulating topics to address and intend to address them once I catch up on a bunch of necessary tasks. The past several weeks have seen the media, when not occupied by tornadoes, prattling on about any numbers of government “scandals.” I don’t really have the time but I’m making some. I must comment on all of these things, most importantly the very recent episode of “Crisis TV,” in which most everyone is shocked and angered at the excesses in surveillance by various government agencies, primarily the NSA, that gouge into our protective armor of constitutional rights, at will, without compunction. A majority of media are fanning the flames of indignation, and to be honest much of it is righteous, but not in the way it is being presented to and then mirrored by the public.

I’d like to address these issues, which are legion, in some sort of organized fashion. This could prove difficult. But let’s give it a go anyway, shall we?

The first issue being screamed about is “Benghazi.” There is a significant effort being made to establish the word “Benghazi” as a brand, encompassing any number of negative aspects of government. It is a buzzword on steroids. Those using this brand as a political mace to batter the administration are using the same tactic as those who are appalled by many of the other transgressions, perceived and/or real, promulgated by the catchall villain, as the disrespectful refer to him (among other names), Obama.

They are intentionally failing to admit that they knew what was happening surrounding the incident, always have known that things work this way, and were perfectly happy to allow it to happen unfettered when done by a government of their own persuasion. They conveniently forget to mention that during the previous administration numerous similar incidents took place, also with loss of life. Knowing full well that this type of disinformation and prevarication is status quo for the US intelligence community and any administration who fronts for them, the anti Obama faction also realized they had an excellent opportunity to make political hay. And the hayloft filled up rapidly.

CIA, State, and the White House were not about to reveal what they actually knew about what happened in Benghazi until the matter was settled to their liking, perhaps not for a great while, maybe never. The chaotic nature of the incident also meant that the investigation could take some time. There was a chance that not much was known by anyone. Instead, I believe that a great deal was known, and the White House didn’t want to let on what it knew, so as not to tip off the bad guys. Regardless, the anti Obama gang knew they could sell any type of conjecture, and repeatedly, because the White House, speaking for State and CIA, would not be able to refute without compromising national security. This marketing they did with great vigor and continue to refer to “Benghazi” at every opportunity, as if it were as well known a brand as Coke or Kleenex.

The second manufactured scandal, which has grown tremendous legs, is the issue of the IRS “targeting” tea party and similar organizations applying for 501 c 4 tax exempt status. Until the recent privacy issues this was number one on the manufactured crisis hit parade. That mean old, sick and disgusting, tyrannical IRS was treating these innocents like sewer rats. All they did was ask for the agency to give their obviously political organizations 501c4 tax exempt status. Apparently the good folks at the IRS singled out conservative organizations with the words “Tea Party” and “Patriots” in their name for extra scrutiny and asked them humiliating and bizarre questions that went beyond the scope of a legitimate investigation, to which no human should ever be subjected. True, and clearly over the top, but not a socialist plot.

First off, to my mind, the truly interesting thing about this entire matter is that it uncovered the fact that the original statute, from the Revenue Act of 1913, stated (and I paraphrase, emphasis mine) that to receive this 501 c 4 status a not for profit organization or civic league must operate exclusively for social welfare or be a local association of employees of a designated person or persons in a particular municipality. These organizations net earnings are to be devoted exclusively to charitable, educational, or recreational purposes.

Somehow in 1959 the IRS reinterpreted “exclusively devoted to” to “primarily engaged in” promoting, in some way, the general welfare and common good of the community. They did this without any authority or directive to do so. This represented a dramatic change in the perception of the intent of this statute. In essence what it meant was the IRS had been granting this status to numerous organizations incorrectly for many years, for several reasons, and continues to do so. It means that virtually none of the organizations so vociferously bemoaning the alleged shredding of their inalienable rights, by a vile President bent on disregarding and demeaning the Constitution, and thus destroying “Their” America, are rightfully eligible for the tax exemption. This unilateral twisting of the law is what the IRS is really guilty of and not so much the targeting of these particular groups, however screwed up that was.

To be frank, in this instance the IRS was actually doing it’s job, just in an entirely irresponsible way. Congress, including some who are among the complainers, had asked that the IRS investigate applicants for tax exemption for potential fraud, concerned that government was losing plenty of potential revenue through that illegality. They also cut the budget of the IRS, which always leads to a situation where stress and an increase in workload makes it difficult for any agency to fulfill it’s mandate. This led overzealous IRS employees, assigned to reviewing 501 c 4 applications and overwhelmed by a 200% increase in those applications, to begin flagging groups they felt were likely to be “primarily” political in nature. Granted, these were pretty much all conservative groups. But if I were investigating fraudulent applications for tax exempt status I might be inclined to move groups who have publicly expressed their disdain for paying taxes to the front of the line. Stupid and thoughtless, but not a conspiracy.

In reference to the Obama administration being responsible for this disgrace, the commissioner of the IRS at the time of these transgressions was appointed by the previous President. That these challenges to the applications are a sudden revelation is refuted by the fact that this commissioner, Douglas Shulman, testified in front of a House hearing led by Darryl Issa, and said that the process of investigating to separate legitimate groups from “primarily” political groups was, and always had been, standard procedure and did not represent any sort of “targeting”. Evidently even Rep. Issa was satisfied with this testimony and the matter faded into the woodwork. This was in March of 2012. It would seem that if this were to have been considered a true crisis that it should have become so then, or in late 2011 when it was revealed that this investigation was happening. I find it interesting that it suddenly became a big deal right when certain people saw an opening and wished to press their perceived advantage by introducing another scandal into the public consciousness.

Now we come to the part of the story which actually qualifies as a legitimate national concern, worthy of a serious in depth discussion among all relevant parties, most of whom have arguments of value. However, this issue is also being used as a political bludgeon to beat on our chief executive. In this case the events, many leaked to the public illegally, are very disturbing. Starting with requests that the Associated Press allow gov’t access to it’s phone lines, which threatens journalistic integrity, to the revelation that huge amounts of American citizen’s communications data of all kinds are being kept and stored by the NSA, this is the real issue of import to our nation. Contrary to the loud protests on the right this is not a political issue but a philosophic one in which the nature of what America is and what it represents is conflicted and in peril. And contrary to the calls of betrayal from the left this is not so much a radical departure from his values for the President as an epiphany, which all presidents discover, regarding the realities of our national security interests.

Regardless of the outrage at these violations of privacy and liberty, they are legal. They have been legal since the National Security Surveillance Act of 2006, when the illegal activities of the Bush administration were modified slightly, brought before Congress, and voted into law. This type of surveillance is informed by the secret FISA courts, started during the Carter administration, which are supposed to provide oversight on federal surveillance procedures. Unfortunately the courts and the secret court orders they issue, have not been very effective in keeping the barn door closed. The powers granted by the NSSA have been used generously by both the Bush and Obama administrations, citing as justification that they protect national security, by the provision of valuable evidence surrounding terrorist activities. So we see that even in death Osama Bin Laden has dramatically affected the very core of the American way of life.

It is my opinion that this is a serious issue that reaches deep into the protections of the Constitution and also has dramatic national security implications. As usual, technology outstrips the ability of society to understand and integrate it adequately into responsible application. The conundrums created vex us. They elicit strongly held and virulent opinions, whose powerful emotions make it difficult to have a reasoned conversation. If at all possible we must curtail our fury and remove the politics from the issue, which may be, regrettably, impossible. We must enter into, immediately if not sooner, a sober and respectful conversation about the relative merits of the surrender of civil liberties in the interest of national security. There are compelling arguments for both sides of this problem.

There is also an innate fear and mistrust of “Big Brother” in America, and rightfully so. Yet the threat of terrorism, domestic and international, is real and quite frightening. There needs to be a revised understanding of what exactly protection and safety mean and what level and nature of privacy is to be expected in a free society. As is nearly always the case, the best interests of the individual and those of society must go twelve rounds with each other. There is no guarantee that a clear victor will emerge and both parties will undoubtedly come out bloodied.

What truly upsets and scares me is that the spirited offensive against the president and the forced defensive response, both of which unfortunately appear to be tethered to the 2014 elections and beyond, will make it unlikely that we will be able to have the type of sensible and respectful dialogue this issue so desperately needs. We so need to prevent the unfortunate polarization of this sensitive and important issue from causing more rending of the fabric of American society, which we can little afford in this dangerous time.

Sadly, I fear this is wishful thinking. An inevitable and unstoppable fail.

If only I could be convinced the glass is half full.

An Economic Epiphany

I freely admit that the subject I probably know the least about is economics. I didn’t take Economics in college, primarily because I both despised and feared Statistics. I have never had more than a passing interest in it throughout my adult life. It is pretty much Greek to me, and outside of the bare basics of supply side and demand side I know very little about the complex influence of the application of various policies on the economy. But in the wake of the recent great recession I have vowed to learn more.

It was a significant epiphany for me that, during the consumption of a soft serve cone at Burger King, a revelation came to me, ostensibly from the bowels of the universe, about the basic nature of economics. It came to mind, as it often does, that the obscene profits taken by certain people were immoral. I was struck by the thought that since there exists a finite amount of wealth this means that as long as there were winners there was a corresponding amount of wealth lost by losers. This troubled me. It made the accumulation of great wealth by CEOs, hedge fund managers, and insider day traders, among others, seem particularly cruel.

The pain and despair of those unfortunate “losers” is not only a personal tragedy but a national one as well. Some of these losers are businesses and their failures carry with them the loss of jobs and production of wealth. And many of those “losers” are not failures in the classic sense of being inferior players of the game. Many of them were merely on the wrong end of an arbitrary decision by the powerful. Their only crime was being in the wrong place at the wrong time.

So I asked myself, “How do we reduce the numbers of losers without reducing the number of winners at the same time?” After all, people deserve to make profits from their hard work and good ideas. This was when the light bulb went on. It became clear why certain economic indicators were so important to those who care about such things. The answer was growth. If additional wealth is created and the economy grows, then, at least on average, the profiteers take their profits from the added wealth produced and the losers need not lose. Ideally profits and growth are equal and there are no losers. We know this does not happen in nature. There are always some losers. But in growth times the losers are more likely defined by the natural perils of the market than by the dirty tricks of the Gekkoesque, although those indignities still happen with greater than deserved frequency. During periods of growth things in general are not so bad. Lots of winners and few losers.

We won’t go into the idea that perpetual growth is impossible in a capital based system. Not now at least. So we will assume that growth is possible and likely probable. I wondered why growth was so slow today. What could be the cause of profit taking without the creation of wealth necessary for a healthy, free marketplace? It was this phenomenon which seemed to me to be the likely cause of a non growing economy, of winners and losers, and the harbinger of economic weakness with the accompanying recessions. Could it be that there are those who take profits, often obscene profits, without contributing to the creation of wealth in any way, who are some of the main villains in this scenario that creates losers?

There are plenty of people in America who make money, lots of it, and never create one iota of wealth. They do it simply by transferring money or assets from one place to another, one party to another, taking a goodly cut for their facilitation. Another group makes their millions organizing, and often manipulating deals, consolidations and mergers, once again taking their cut merely from having the connections to bring the players together. These people often use other people’s money to make their own, socializing the risks and privatizing the profits. Corporate CEOs take in outrageously big salaries, with gigantic golden parachutes. Their compensation is not commensurate with their value to the business. Another bunch of leeches manage hedge funds, those exclusive mutual funds that exist mostly for the wealthy. These Wall Street millionaires actually do participate in a degree of wealth creation but also take huge salaries for performance that is little better than the average Joe using Charles Schwab.

These people are examples of a phenomenon made popular during the Reagan years. It is the concept of making money without doing any work. There have always been people who did this but in the 80’s it became fashionable. For the huge influx of students who rushed into MBA programs at the same time it became the ultimate goal. The ethic of hard work and playing by the rules gave way to a cut throat race to the top where success was measured only by how rich one could get, how fast and how easy.

I feel that after thirty years or so of this amoral profiteering I call “transactional exploitation” our country was ripe for the kind of economic collapse we suffered in 2008. It was this vampiric greed, coupled with the repeal of Glass-Steagal, that played an important role in bringing on the great recession.

The economy of the early 2000’s was largely driven by the housing construction and real estate markets. To simplify a complex scenario, in the 1990’s Congressional Democrats advocated that we make home purchase available to more Americans. Because home ownership was regarded as a lynchpin of American economic prosperity the Democrats reasoned that making home ownership available to more citizens would help stabilize the economy. They were thinking along the lines of slightly lowered income requirements, lower down payments, longer term mortgages and reasonable interest. Instead the vultures, enabled by the repeal of Glass-Steagall, created toxic financial products which they misrepresented to naive first time home buyers. Banks created nebulous security constructs which led to short term profits but were destined to fail. When the bubble burst it took down the housing market, major lenders and established securities brokerage houses. All of Wall Street collapsed in the wake of this implosion and investors suddenly lost as much as 40% of their assets. We are still crawling out of that hole and yet the vultures keep looking for scams that will make them flush while flushing the suckers they exploit down the proverbial drain.

I do not begrudge talented people from making good livings from the application of their unique skills. But there is a difference between making a living and making a killing. Just look at the words, living and killing. Which word fits better into a just and prosperous society, where all have the opportunity to thrive. Which fits a society where the ladder to success exists, but honest people trying to climb it are stepped on and thrown of by the ruthless or never allowed on it because of the neighborhood they grew up in or the color of their skin or the economic impossibility of getting the education or training they need to be able to climb in the first place.

Somehow society, through our collective ownership of government, must begin to re-balance the value of professional endeavor in America. We must figure out a way to reduce the value of the greedy non wealth creators and increase the respect for and value of under appreciated careers such as educators, scientists both social and applied, nurses etc. We must educate to the point where consensus demands that the gap in earnings between the lowest and highest is not so dramatic.

The transactional exploiters, who imagine themselves job and wealth creators, and those who worship them, aspiring to be just like them, are a bigger threat to the American economy and national security than any of the alleged “takers” so often mythologized by some. It is the alleged “makers” of whom we need to be careful.

Maybe I know more about economics than I imagined.