mindchanging politics

In his third State of the Union address President Obama drew a picture of cooperation between government and business for an America that is “built to last”—a phrase he repeated frequently that was intended to remind listeners of his successful plan to bail out America’s auto industry. The President pointed to Detroit as a prime example of what government can do when it works with business to keep America’s factories and jobs from going under or being shipped overseas. He rightly claimed a victory here that did more good for Americans than settling our score with Osama bin Laden:  “We bet on American workers. We bet on American ingenuity. And tonight, the American auto industry is back.”

The picture of cooperation is starkly different than the antagonism between government and business painted by the “loyal” opposition of the Republican Party. In his televised response to Obama’s address, Governor Mitch Daniels of Indiana laid the blame for America’s economic downturn squarely at the President’s feet despite acknowledging that the recession began under his party’s own watch. (He did not mention that Republican-style economic policy was almost entirely to blame for America’s economic mess.) The tepid speech was out of touch with basic facts and did nothing but rehash the same time tired rhetoric this party has been jabbering for years:  smaller government, no taxes, less regulation and oversight of the economy.

Take the following assertion Mr. Daniels made about spending under the Obama administration:  “In three short years, an unprecedented explosion of spending, with borrowed money, has added trillions to an already unaffordable national debt.” Or again, the assertion that the “grand experiment in trickle-down government has held back rather than sped [sic] economic recovery.” The claim that the debt has increased under Obama is true, but the assertion that it comes from new spending, or that government stimulus like that from the Detroit example failed, are shameless lies that stink of political desperation.

The fact is that federal spending was already on pace to “explode” the national debt, and not because the President had the power to spend more money on new programs. Rather, the debt spiraled out of control for two reasons:  first, the Bush-era tax cuts dried up revenue to keep pace with spending; and second, the financial collapse, and subsequent shrinking of growth and income, scorched the earth of what was left of tax-based revenue sources. Since most revenue goes to servicing the national debt it exploded once the principal source of revenue was destroyed by the Republican give-away of tax cuts to the wealthiest 1 percent of Americans. Republican attitudes and policies on taxes and deregulation are more to blame for the skyrocketing debt in the last three years than anything the President has the power to do.

The starkly different pictures of the relationship between government and business are apparent, but the picture painted by the Republicans reveals economic fantasizing that lacks common sense. Like a work by Monet, this picture looks good from far off but closer inspection reveals the outlines lack a coherent shape and details are fuzzy. Here is a soundbite that feeds such fantasizing because it lacks any grounding in real facts about our present economic problems:  “We do not accept that ours will ever be a nation of haves and have nots; we must always be a nation of haves and soon to haves.”

Never mind that economic inequality has grown significantly in the last two decades, much of it in the last several years, and is now at its greatest point since the Great Depression. Never mind that the rate of poverty, in which individuals and families live on approximately $10,000 annually, has grown by 30 percent in the last three years. These economic facts are ignored by the “loyal” opposition in favor of talking points that are seemingly designed to reassure themselves of a world picture that never was, isn’t now, and never will be. Republicans are not interested in what’s true as a matter of fact, they are only interested in what sounds true to millions of unskilled listeners who, like them, paint in big brush strokes, but can’t keep between the lines when it comes to drawing a coherent picture that remotely looks like reality.

 A Gallup News Poll released Monday is telling. Americans trust their bankers more than their elected officials. According to the poll, 64 percent of Americans rate the honesty and ethical standards of Congress as low/very low. This is the lowest rating since the poll was first started in 1976 to rate the public’s perception of the trustworthiness of various professions. Congressional representatives (and presumably senators) are now tied with lobbyists, who are consistently ranked at the bottom along with the ubiquitously sleazy profile of used car salesmen and telemarketers. (Won’t somebody give good ‘ol Gil a break?) In other words, well over half of Americans believe their politicians are liars.

This dim view of American democracy is consistent with the public’s low disapproval rating of the job Congress is doing, or not doing as it were. An overwhelming 82 percent of the electorate is dissatisfied with its performance, whereas 10 years ago an average of 60 percent of those surveyed approved of the job Congress was doing. Times have changed. Or have they?

Two troubling facts stand out when placed alongside these statistics.

1. The incumbency rate in Congress has been above 80 percent since 1964. That means less than 20 percent of the U.S. House of Representatives turns over from year to year. In the Senate the numbers vary slightly more but not by much. Since 1964 the incumbency rate in the U.S. Senate has never dropped below 50 percent, and since 1982 it has remained steady at 70-80 percent. What does this mean? Despite skepticism of both the profession and institution, Americans continue to send the same people back to Washington over and over again. In short, they reward the apparently poor performance of representatives and senators by reelecting them. (This fact can be related to the alarming salaries and bonuses that corporate executives are giving themselves despite their poor performance. Got Enron-fever, anyone?)

2. In addition, Americans rate the honesty and ethical standards of various business professionals higher than Congress. Only 22 percent of responders ranked real estate agents as low/very low, 26 percent for bankers, 32 percent for executives, 37 percent for lawyers, and 40 percent for stockbrokers. This means that on average Americans trust big business more than democracy despite the fact that the former is paying off the latter to do its dirty work, and despite the fact that the public is supposed to exercise control over the latter with the power of voting.

What is troubling about these statistics is that Americans are clearly losing (have lost) control of their democracy, and the numbers explain exactly why this is happening. They basically trust the corporate world (slightly) more than their politicians. Yet it is corporate America that is getting its way in Washington and having its way with America—by flooding the nation’s capital with billions of dollars in election money, corporate sponsorship of policy think tanks, and downright graft. Even though the electorate is apparently aware that the honesty and ethical standards of politicians have been compromised, they are alarmingly less aware that the source of that corruption can be traced to corporate America.

For all the vaunted talk of the Tea Party’s renewal of responsible government it is the anger and frustration reflected in the Occupy movement that best reflects the political reality. The exclusive blame for America’s problems lies neither with politicians and big government, nor corporations and their greedy executives. There is plenty of blame to spread around there, and OWS has taken an important first step in exposing this evil collusion between elected officials and big business. When it comes down to it, the electorate shares much of the blame for sending the same people back to Congress year after year, effectively preserving a perverse incentive structure for rewarding incompetence and corruption. Maybe it’s time to run for Congress?

On the growth of inequality in America:  “But for most Americans, the basic bargain that made this country great has eroded.  Long before the recession hit, hard work stopped paying off for too many people.  Fewer and fewer of the folks who contributed to the success of our economy actually benefited from that success.  Those at the very top grew wealthier from their incomes and investments than ever before.  But everyone else struggled with costs that were growing and paychecks that weren’t – and too many families found themselves racking up more and more debt just to keep up.”

On the need for rebuilding the middle-class:  “But this isn’t just another political debate.  This is the defining issue of our time.  This is a make or break moment for the middle class, and all those who are fighting to get into the middle class.  At stake is whether this will be a country where working people can earn enough to raise a family, build a modest savings, own a home, and secure their retirement.”

On President Teddy Roosevelt’s call for economic and social justice in America:  “In 1910, Teddy Roosevelt came here, to Osawatomie, and laid out his vision for what he called a New Nationalism.  “Our country,” he said, “…means nothing unless it means the triumph of a real democracy…of an economic system under which each man shall be guaranteed the opportunity to show the best that there is in him.”

For this, Roosevelt was called a radical, a socialist, even a communist.  But today, we are a richer nation and a stronger democracy because of what he fought for in his last campaign:  an eight hour work day and a minimum wage for women; insurance for the unemployed, the elderly, and those with disabilities; political reform and a progressive income tax.”

On protecting and renewing American workers:  “And if you’re someone whose job can be done cheaper by a computer or someone in another country, you don’t have a lot of leverage with your employer when it comes to asking for better wages and benefits – especially since fewer Americans today are part of a union.”

On the lies of Republican economics:  “Now, just as there was in Teddy Roosevelt’s time, there’s been a certain crowd in Washington for the last few decades who respond to this economic challenge with the same old tune.  “The market will take care of everything,” they tell us.  If only we cut more regulations and cut more taxes – especially for the wealthy – our economy will grow stronger.  Sure, there will be winners and losers.  But if the winners do really well, jobs and prosperity will eventually trickle down to everyone else.  And even if prosperity doesn’t trickle down, they argue, that’s the price of liberty.

It’s a simple theory – one that speaks to our rugged individualism and healthy skepticism of too much government.  It fits well on a bumper sticker.  Here’s the problem:  It doesn’t work.  It’s never worked.  It didn’t work when it was tried in the decade before the Great Depression.  It’s not what led to the incredible post-war boom of the 50s and 60s.  And it didn’t work when we tried it during the last decade.

Look at the statistics.  In the last few decades, the average income of the top one percent has gone up by more than 250%, to $1.2 million per year.  For the top one hundredth of one percent, the average income is now $27 million per year.  The typical CEO who used to earn about 30 times more than his or her workers now earns 110 times more.  And yet, over the last decade, the incomes of most Americans have actually fallen by about six percent.

It’s heartbreaking enough that there are millions of working families in this country who are now forced to take their children to food banks for a decent meal.  But the idea that those children might not have a chance to climb out of that situation and back into the middle class, no matter how hard they work?  That’s inexcusable.  It’s wrong.  It flies in the face of everything we stand for.

But in the long term, we have to rethink our tax system more fundamentally.  We have to ask ourselves:  Do we want to make the investments we need in things like education, and research, and high-tech manufacturing?  Or do we want to keep in place the tax breaks for the wealthiest Americans in our country?  Because we can’t afford to do both.  That’s not politics.  That’s just math.”

The Department of Labor announced that jobless claims were down from 9 to 8.04 percent in November, the single largest decline since March 2009. The fraction translates into roughly 120,000 new jobs created by private employers. However, the report grimly noted that the decline in jobless claims was also partly due to workers giving up looking for jobs in the grim labor market, particularly women.

The report also revised higher the average number of jobs created each month to 143,00 over the three-month period going back to September, an average that is higher than the historic low from May to August, in which anemic job growth signaled the unwillingness of investors and firms to take on new workers at the height of the European debt crisis and the earthquake in Japan that disrupted shipping and supply chains globally.

This November job “rally” can be traced in large part to retailers who added temp workers during the holiday season, so it is unclear whether there is cause for celebration as the transient nature of these 50,000 jobs may become all too apparent in January when retailers let go of their seasonal workers. (Can we expect a rise in jobless claims after the holidays?) In addition, this year’s record-breaking figures by retailers for Black Friday also improved prospects that consumers are more willing to spend in the hopes of a brighter economic future.

However, while economists are claiming that the labor report shows the economy is “improving at a faster clip,” the real news on the ground is that anemic job growth is hampering the economic recovery as workers without jobs spend less on goods and services and firms continue to find ways of cutting workers in order to bolster their bottom lines. The seasonal affective disorder known as “holiday shopping” is only a temporary respite from the really bad news, which is that the real wages of Americans are down and their credit card debt is on the rise again.

These are “not” the signs of a healthily recovering economy, but given the dismal performance and prospects of economic growth in the near future, economists, politicians and investors alike are holding onto this bare bit of news that jobless claims are down, literally, by .06 percent. This is an embarrassing piece of evidence that sound economic policy, which must include job creation (thank you very much, Republicans, for voting against jobs for Americans), has been substituted for the rather conventional approach of grasping at straws in a rising flood.

In a sign that the U.S. and European Union are serious about resolving the ongoing debt crisis in the euro zone, the central banks of five countries, including the European Central Bank, the Bank of England, Bank of Japan, Bank of Canada and the Swiss National Bank, announced a plan to infuse banks across the E.U. with fresh capital. The move comes in an effort to assure financial markets that the debt crisis is being taken seriously and policies are being developed to resolve it.

The announcement comes on the heels of global financial markets being battered in the last two weeks as investor confidence has withered in the face of the ongoing debt crisis, as well as the inability of governments to take swift action to alleviate it. The move by the central banks is supposed to reduce the cost of a program under which banks in foreign countries can borrow money from their own central banks by about 40 percent, with much of the money coming from the Federal Reserve Bank in the U.S. This is supposed to infuse banks with fresh capital and shore up their liquidity in the hopes that they will begin lending again.

The news led to today’s rally on Wall Street, one of the biggest yet, with the three main indexes rising 4 percent or more, representing the largest gain since March 2009. Stock markets across followed favorably with exchanges in London, Paris, Berlin, and Euro Stoxx rising from 3 to 5 percent.

However, the rally will be short lived, as they have proven to be in the past. Although investor confidence depends heavily on the perception that governments are taking strong action to deal with avalanche of debt arising from a slowing global economy and shrinking tax revenues, the underlying reality is that the fundamentals of the global economy are not sound. There is too much money controlled by two few private actors, particularly large hedge funds and other investment banks, that can be moved around too quickly, thanks in large part to financial deregulation and advanced communications technology. Moreover, there is too little democratic accountability, particularly in the U.S., which has deregulated banks, insurance carriers, and other financial institutions to the point where the fraud and theft of “complex financial instruments” are legal grey areas.

Plagued by serious unemployment both the U.S. and E.U. cannot jump-start their economies even if the debt crisis is resolved favorably. Assume banks achieve stability and return some of their liquidity to businesses and consumers in the form of loans. Very few companies will enact aggressive expansion strategies that require hiring new workers, and banks will not lend to consumers without jobs. Thus, even if the debt crisis is resolved, there is no guarantee that the labor market will improve, leaving governments in the lurch as revenues from taxes remain stagnant and requiring them to make further cuts in entitlement programs that exist to help citizens beset by difficult financial times.

This catch-22 is not lost on investors, who more than once in the last few years, have rallied markets on some slim piece of good news like the announcement made today by central banks, only to have their hopes dashed the next day by a slim piece of bad news, for example, that jobless claims are up. The surge in markets today is therefore not “good” news in the sense that it does not guarantee that the so-called “jobless recovery” is actually underway.

The national dialogue started by Occupy Wall Street will continue, but the last of the encampments that have sprung up in big and small cities across America will be cleared out tonight.

Occupy LA the last to be evicted.

Last Friday, Mayor Antonio Villaraigosa and Police Chief Charlie Beck held a press conference announcing the city of Los Angeles was issuing an eviction order for the lawn of City Hall where hundreds of protesters associated with Occupy Los Angeles have been camped since October. On Monday at midnight police began enforcing that eviction order, arresting dozens of protesters in a largely peaceful manner. This is in stark contrast to other cities and university campuses where police have used unnecessary and outrageous force to evict protesters from public spaces.

This signals the end of the first stage of this movement, to occupy these spaces in order to draw the nation’s attention to its unchecked economic and political corruption. Although media commentators, some members of the general public, and FOX News have nurtured doubts about the “focus” or the “message” of this movement, there can be no doubt that this Occupy Movement has restored the problem of economic inequality in the conscience of the nation.

The question now is what the second stage of this movement will look like. As protesters and sympathizers search for the means to continue raising consciousness about the problem of inequality, efforts must be made to create a national organization with state and local outreach. This should be done to counter the perception that the Occupy Movement is merely a bunch of malcontents, anarchists, and homeless persons without a message.

In reality, it is a movement made up of diverse Americans all of whom have been adversely impacted by an economic and political system that no longer serves the interests of the supermajority of its stakeholders. These Americans include young and old alike, whether they are homeless, poor, unemployed, or employed is irrelevant. The Occupy Movement represents the most authentic cross-section of America to date, and therefore speaks honestly to the very real problems that plague our friends, families, and fellow citizens.

We live in the wealthiest country in the world. Roughly speaking, that wealth is controlled by 1 percent of its citizens. Meanwhile, the lives and prospects of the remaining 99 percent continue to suffer and diminish in the face of permanent unemployment, massive credit card and student loan debt, and a democracy that has been hijacked by money and special interests. Despite attempts by corporate hacks and establishment apologists to discredit the Occupy Movement for lack of “focus” or “message” because it lacks “sexy” marketing, the nation owes these brave souls who have suffered derision, endured bad weather and faced the batons and pepper spray of police officers, for bringing the real problems of this country to the table.

After weeks of intense and bitter negotiation, the so-called “Supercommittee,” the special Congressional Committee charged by President Obama to find a bipartisan plan for reducing the budget deficit, has failed to reach a compromise. Last week Democratic members of the committee were hopeful that one Republican would agree to support a tentative bipartisan package that includes agreements on tax rates, spending cuts, and changes to entitlement programs such as Social Security and Medicare.

Democrats blame Republicans for refusing to compromise on either tax rates or tax increases, while Republicans blames Democrats for not proposing serious cuts that bring federal spending into line with their ideological vision of smaller government. Democrats claim that Speaker of the House Jim Boehner (R-OH) killed the hard efforts of the panel on Thursday by offering legislation to increase new revenue by $3 billion in new revenue, which would be devastating to entitlement programs millions of Americans rely on.

Both parties are stuck on the question of tax reform because Democrats rightly believe that the wealthy have benefited too much from the climate of deregulation and corporate malfeasance, and as a result should pay their fair share in a system they exploit and profit from. Republicans are sticking to their long-time (and patently false) position that taxes frustrate economic growth and spur entitlement spending. In short, Democrats believe in the Grand Compromise between democracy and capitalism first initiated by President Franklin Roosevelt’s New Deal, while Republicans believe in every man (literally) for himself.

The failure of the committee to reach a compromise agreement is troubling for the anemic economy, and signals that the bipartisan rhetoric of both Democrats and Republicans cannot be trusted. Yet the elephant in the room is that Republicans care little about a healthy, functioning government and want to substitute private decision-making for democratic procedure. Economists of all political persuasions are in agreement on this point:  there can be no serious deficit-cutting proposal that does not both cut entitlement spending and raises taxes. The gap is too large and growing larger daily, so President Obama must find a way to tap into the political energy unleashed by the Occupy Wall Street movement, and demand that Republicans give up their fantasy of a tax-free world. It’s high time everyone paid their fair share, including Republicans and their rich and powerful benefactors.

Hundreds of protesters marched on Wall Street early this morning to prevent traders, financiers, and technocrats from reaching their jobs at the Stock Exchange. So far, 100 people have been arrested as the Occupy Wall Street movement vows to keep up its visible presence in New York, highlighting the greed and injustice of the American financial and political system.

84-year-old Dorli Rainey was brutally pepper sprayed by Seattle police, and has become a symbol of the brutal tactics used by law enforcement to suppress democratic dissent.

Protesters clogged the streets around Wall Street, blocking traffic and halting people from reaching the Exchange. Police in riot gear moved in quickly, telling the marching crowds to disperse or face arrest. When dozens of people began sitting down in the intersections, they were quickly arrested. Similar protests and marches are scheduled to continue throughout cities across the nation.

The tactics of law enforcement have come under increasing scrutiny as video footage is leaked to the public and press, showing police pepper spraying and beating otherwise peaceful protesters. In Seattle, the police are being heavily criticized for unjustifiably using pepper spray and truncheons on its own citizens including 84-year-old Dorli Rainey, who has come to symbolize the protest movements nationwide.

As law enforcement moves to evict occupiers in cities across the country, more attention should focus on police tactics, which all too often rely on the brutalization of citizens and the violation of their civil liberties. The police are supposed to “serve and protect,” but their role in suppressing these democratic protests raises the question whether they have become an instrument for the wealthy and powerful to preserve the status quo. Mayors, police commissioners, and officers who are implicated in these brutal tactics should be held accountable for their actions.

The truth hurts us all.

Acting on behalf of the wealthy and powerful interests of Wall Street, New York City Mayor Michael Bloomberg defended his decision to clear out Zuccotti Park, where protesters have staged a camp out that has captured the attention of the nation in order to highlight the injustices and inequities of American-style capitalism.

Mayor Bloomberg claimed that conditions in the park had become intolerable, and that “public health and safety” determined his decision. However, he also announced that the park would reopen tomorrow morning, raising doubts that the conditions of the encampment in the public park were to blame. More likely, Bloomberg’s close ties with Wall Street pressured the billionaire to use his official position to deny the Occupy Wall Street movement its constitutional right to peaceably assemble.

This is not the first time Bloomberg has used the coercive powers of the state, as well as the notorious tactics of the NYPD, to deny democratic protesters their constitutional rights on the streets of the Big Apple. In 2004 his administration and the NYPD came under fire for mishandling the Republican National Convention protests around Madison Square Garden. Thousands of people were arrested in broad and unjustified sweeps of the city streets under the guise that “law and order” must be imposed in order to provide security against the threat of terrorism.

Many of those arrested were either innocent bystanders watching the protests from sidewalks, or people out shopping, or New Yorker’s walking home from work. I was personally jailed 46 hours, first at Pier 57 where a bus terminal was turned into a holding pen, and then at the city’s notorious central jail called “the Tombs.” The New York Civil Liberties Union and National Lawyer’s Guild later launched a class action suit against the city, which has been bogged down in a legal quagmire. Hopefully, the Occupy Wall Street movement will receive much needed legal aid from the armies of unemployed lawyers who have lost their jobs because of the greedy fucking pricks running Wall Street, our country, and the global economy into the ground.

Occupy Wall Street is a small movement fronting a gigantic cause for the rest of us. Mayor Bloomberg and has now established a precedent that other cities are likely to follow. In the name of “public health and safety,” the constitutional rights of Americans to protest government incompetence and inaction concerning the causes and consequences of the recession will be ignored and undermined. In the name of cleaning up some shit on the sidewalks, they will be asked to tolerate more shit flowing downhill as their incomes shrink and profits flow uphill.

The use of state violence to deny this constitutional right is a gross injustice that Americans are likely to tolerate, leaving them vulnerable, yet again, to future collusions between the state and wealthy individuals in which they bear the costs, socially, economically, and politically.

What is to be done? #occupycongress