May 21, 2009

Distinctions without a difference

Admittedly there is a fine line between a skeptic and a crank, and one sometimes finds oneself crossing it unawares, especially if you're in the semi-regular habit of blooging (my portmanteau word for blogging and boogeying at the same time - I haven't checked to see if Maureen Dowd has stolen it).  For example, those who still spend most of their free time (and that's mostly what they must have) perusing the Warren Commission Report for evidence of the Mother of All Coverups probably belong in the Tin Foil Hat Brigade.  But the line is not always clear.  For example, did the CIA introduce crack cocaine into the United States as a result of the work it did for the Contras? What did make building #7 at the World Trade Center fall down on September 11, when no plane actually struck it?

You can't always tell what's really going on.  In the heyday of the Soviet Union, no sane, ordinary citizen of that country ever believed anything the government said; if it was published in Pravda, that was all the proof needed that it was an Official Lie.  The government could lie all the time because there was no effective competing party or group - the Commies controlled everything, the organs of government, the organs of the media.  If the citizenry didn't like them, it didn't matter.

I think some of these elements have taken root in the American system, and the germ of the idea, for me, resulted from reading Dmitry Orlov's writing on American politics.  He lived through the final years of the Soviet state and witnessed its collapse.  What he says about the U.S. is that we now have two Center-Right Parties which no longer have to respond to the actual needs of the citizenry.  There certainly are differences between the Democrats and Republicans and trivializing those differences is a mistake.  The problem is that the differences between the parties are not significant enough to make any real difference in the lives of ordinary Americans, and the ordinary citizen has no one else to vote for.  In effect, the so-called Two Party System has morphed into something akin to the PRC in Mexico during its long tenure of one-party rule, or similar to the Communist Party in the Soviet Union between 1917 and 1991.

Take one of my favorite examples, the Crime of the Century by which Congress stole the Social Security Trust Fund.  This was a $2.5 trillion heist.  There is no serious argument that anything else happened; in the early 1980's, Congress foresaw, or at least pretended to see, that the massive retirements of the Baby Boom generation starting meant that the system would be insolvent unless FICA taxes were raised to create a trust fund of real money to make up for the short-fall in revenue caused by the retirements and the consequent drain on the system.  Congress took these large annual surpluses and spent them as part of general revenue, replacing the stolen money with Special Issue Treasury Notes, that is, IOUs.  This year the Social Security surplus is down to $3 billion; in better years, in the 1990s, it was closer to $200 billion.  So you don't need to be a swami to see that the inflows are about to become insufficient to pay the outflows, especially as we shed jobs at the rate of 500,000 per month and the Baby Boomers are now drawing on Social Security in increasing numbers.

If Barack Obama were really, really honest, in the old fashioned sense of that word (that is, a commitment to telling the real truth), he would stop with the civil liberties speeches for awhile and explain what happened to the trust fund in just the terms I used above.  Because that's what happned.  He would not talk about "reform" of Social Security (as Bush did before him), or means-testing or raising the cap on FICA taxes to bring in more money or reducing benefits.  He would lay it all out, the actual truth about what Democrats and Republicans did with the money, and then trace where the surpluses were spent, which was on defense.  He would then honestly discuss the excesses of the defense and security budgets, and the costs of fighting these constant wars of choice in Iraq and Afghanistan and elsewhere, and tell us that since that's where the money went, that's where he's going to get it back.  He would place the ultimate Sacred Cow on the altar of politics: the Defense Budget.

He won't do that.  He won't do it because, fundamentally, he's part of the system.  Calling foul on his co-conspirators in government, the operatives of the Democratic and Republican Parties, just isn't done.  It makes them all look bad.  So instead he will spend his time telling us why indefinite preventive detention (the hallmark of tyranny, according to Thomas Jefferson) is actually okay, and that it's better to conceal the truth and suppress photographs than to be honest about what we've done, because, again, it makes us all look bad.

And never a word about why the security of our retired senior citizens who depend on Social Security has been imperiled because of Congressional malfeasance and criminality, and never a word of explanation as to why we need to spend more on defense and security than the rest of the world (and all our "enemies" included) combined.  If there is actually a difference between that approach and the lies of Official Truth, I would be curious to know what it is and why the distinction matters.  I don't see it.  I don't see it in this "landmark" credit card bill the Senate is currently congratulating itself for, the elimination of a lot of dumb upticks in rates because of late payments, et cetera.  And yet Congress never addressed the actual means by which the banks fleece the naive and financially unsophisticated - the ridiculous, usurious rates charged by credit card companies in the first place.  25 to 30%?  Can Vito parked in the black car across the street cut you a better deal?  

Congress won't touch that because they don't work for you, and they don't work for you because they don't have to anymore. You want the batshit crazy Republicans or the corrupt Democrats?  Up to you, but don't say you didn't have a choice.

May 18, 2009

Land of Happy Motoring

This is kind of interesting - it's a graph, or Greendex, of public use of transportation by country.  Generally (in reading the graph), the more bluish a country's bar graph is, the more frequent is the use of public transportation. Russia ranks #1; the United States ranks last.

Of course, such graphs must be described and analyzed in a value-neutral way.  This graph does not, in my view, impugn Americans in any unique way for being energy hogs.  As you go down the list (to the Germans and French, say, who also don't score that well), you might well conclude that to the extent that a prosperous nation has a good highway or autobahn system, and can afford good autos, the less likely are its citizens to use public transportation. I've seen this myself in Germany - they have such great trains (I think the best in the world) - why do they drive so much?  But they do.  They prefer the convenience, the flexibility, and besides, trains are kind of expensive over there.

The United States, of course, is the apotheosis of the car culture.  Public transportation, except in some congested urban areas where cars are practically impossible to use (Manhattan, for example), Americans look upon as faintly distasteful, the result, perhaps, of bad choices in life.  In movies and popular songs, a bus ride is usually associated with either a period of bad luck ("Midnight Cowboy" or "The Trip to Bountiful") or a sense of being lost (Paul Simon's "America").  Bus stations are usually located in a part of the city where a respectable person wouldn't go for any other reason.  And since that's true, why go there for the bus?

So my view is that the most interesting thing about America is that, for the human species as a whole, we're always a leading indicator.  We're the fattest people on Earth, among the most poorly educated (versus other industrialized nations), the most sedentary, and the biggest energy hogs on the planet. In all these senses, I think we're the most "advanced."  We merely manifest or demonstrate what human beings tend to do and be when given the economic chance to be lazy.   We still own the best real estate in the world, a plenteous, resource-rich, varied, variegated sea-to-shining-sea Eden that many people the world over understandably covet.  We've treated this birthright like a toilet, of course, but that's another matter.  The point is that Americans, over the last 60 years or so, have simply done what any subset of uniquely blessed Homo sapiens would have done with the same advantages: we abused them.

That degenerative process actually underlies the "economic crisis" currently weighing Amurrica down.  While we glorify the Horatio Alger story, and praise the virtues of diligence and thrift, in truth all of that is actually a bummer.  Americans, for a brief period at least (about 20 years) figured out how to cannibalize the capital stock built diligently  up over generations by pledging it as collateral for debt.  We gave various names to this drift: "the Information Economy," the "Service Economy," etc., but what these euphemisms stood in for was the detrmination to get away from the grueling routine of manufacturing and farming jobs (which actually built the country) in favor of a kind of National Trust Fund Existence.

It actually worked for awhile, especially in those halcyon early days of the Bush Administration, about 2001 to 2005, where all regulatory oversight was dispensed with entirely (a process given a big boost by the Clinton Administration).  Lending and borrowing became the main industry in the country.  Alas, the laws of financial thermodynamics reasserted themselves in 2007 and the unwinding process began.  We're in the early stages of that.

As our fortunes sink, it will be interesting to see if our own bar graph above gets bluer.  Not out of virtue, of course, but because it may be the only way to get around.  In the end, that's the only reliable motivator of thrift and conservation - it must be thrust upon us.  It may soon be true that the only autos available for sale in the United States are foreign brands (although they may still be manufactured in the USA), and as the dollar sinks because of unsustainable federal trade and budget deficits, these autos will be out of reach for more and more former "trust fund babies."  

Cathy, I said, as we boarded a Greyhound in Pittsburgh,
Michigan seems like a dream to me now...

May 17, 2009

Let the Lone Star Republic Go in Peace

I was extremely disappointed by Keith Olbermann's uninformed, smarmy rant on his "Countdown" show the other night when he took Governor Rick Perry of Texas (maybe someday the "President" of Texas, or Generalissimo?) to task for mentioning again the possibility that Texas might secede from the Union.  His voice dripping with sarcasm, Olbermann "reminded" Perry of all the benefits of statehood his Republic would forfeit, and mentioned specifically such matters as federal aid, Social Security and the national defense.

Olbermann should have checked one key statistic before launching into his idiotic diatribe: according to the latest figures available (two years ago), Texas ranked 35th in the Union in return on investment (ROI) for federal taxes paid.  For every dollar that Texans send to Washington, they receive 94 cents in return.  (California's situation is much worse; there the figure is 78 cents).  This is a common misunderstanding about the "value" of statehood.  For most prosperous states, it's a net loss to be a member of the United States.  

I'm sure that Rick Perry is aware of this, even if Keith Ol'Blowhard is not.  Perry is simply doing the job he was elected to do: govern the people of Texas.  Their interests should be primary in his choice of policy, and it's become obvious to Perry (and to Sarah Palin's husband, to choose another loud and leading advocate for secession, this time for Alaska) that statehood simply comes at too high a price.  

For example, take a look at one of Olbermann's exhibits for the Union: loss of Social Security benefits.  In the first place, any prosperous state suddenly relieved of the duty of paying in FICA taxes to the federal government would free up enormous amounts of revenue for local use.  It has become a taxpaying fact of life that most Americans pay most of their federal taxes into this pay-as-you-go system; and since it's pay as you go, suddenly cutting off the federal payouts has no long-term effect other than allowing the citizens of a state (such as Texas) to escape the looming bankruptcy of the system and to replace it with something with a future.  The recent report from the Congressional Budget Office underscores how near-term that Social Security insolvency is.  Currently, the system produces only a $3 billion surplus above payouts, and while the forecast is that Social Security will not "go negative" until 2016, in fact this prediction is built on completely unrealistic economic guesswork.  Within a couple of years, at the present rate of unemployment, the system will be underwater.

So the "benefit" of the Social Security system is a mirage, the result of choices made by that vaunted federal legislative body (and Clown College), the U.S. Congress: they spent the 2.5+ trillion dollar surplus built up over a generation on high-tech toys for the military so we could fight unnecessary wars, replacing it with a file cabinet full of IOUs.  That's the sort of benefit you get from statehood: to see your tax payments go up in smoke.

Texas could field its own military - most of its citizens are armed to the teeth now.  With payroll taxes kept in Texas, Texas could easily devise its own solvent pension system and universal healthcare.  It's a big farming state so there will be no food shortages.

So as you're fond of saying to everyone else, Keith: STFU.  If Texas wants to leave the Union, let them.  It might, you know, start something.  Yugoslavia's breakup came about because Slovenia, a northern, European-style economy with close ties to neighboring Austria, wondered what the hell it was doing in a federation with a bunch of insane Southern Slavs and Muslims fighting endless religious pogroms and civil wars.  They announced they were leaving; essentially, the rest of Yugoslavia, too busy killing each other and never doing a damned day's work anyway, let them leave without firing a shot.

Texas: Don't Mess With It.  Perry is operating in the grand tradition of Stephen F. Austin, the Father of Texas, who lived just long enough to see the establishment of the First Republic in 1836, yet mercifully died before the tragedy of statehood in 1845.