Sunday, August 19, 2007

Lets Change The Debate!

Debates?! It's a joke. A candidate gets a whopping two minutes to declare how he'll fix a problem. Or a 30 second rebuttal. Which means someone wasted part of their two minutes to ride down someone else's idea.


Nobody wins these debates. America loses in all regards because they don't inform us. What they do is identify with an emotion. And that's the real problem.

Not that I believe we shouldn't be emotional. I partly agree with the bumper sticker that says that if you aren't outraged, you aren't paying attention. When it comes time to debate the merit of a so called solution to a problem though, the rage needs to be checked at the door.

In Roger Osborne's book, Civilization, he makes this observation: "The Reformation, an apparently simple act of rebellion against the Catholic Church, was in reality a complex series of events that appear to contradict the rules of historical cause and effect. The most obvious legacy of the Reformation was a period of intolerance, bitterness, and religious conflict...."

He concludes that chapter with this: " We have returned to the paradoxes set out at the beginning of the chapter, and the historical story may have shown us that we have been making the wrong kinds of connections. Perhaps the key to the Reformation does not lie in our own rationalization of the motives of the principle actors and meanings of the events, but in the emotional lives and spiritual needs of the people of Western Christianity. If the Reformation tells us anything, it is that humans live through their emotional needs, not through rational consistency."

This is so much the case that Drew Westen has written a book all about it called the Political Brain. I have not yet read it, but I get the point. These two dots connect, and so I respond.

What marks the political debate in this country is not rational consistency, it is emotion. And that is why we have such partisan feelings. Such bickering, such name calling. A Vice President sinking to gutter level language on the Senate floor in public to a colleague. Radio hosts that call people "feminazis" and the like. I myself am guilty of using the phrase the Religious Reich. It may be truly my opinion, and I may be able to substantiate that opinion with fact. But I also have the choice to view them that way and not voice it that way. So my own tongue rebukes me. And that's okay.

What we need in this country is to alter the debate. We finally need to actually enter into an age of reason, as Tom Paine wrote about. For it is reason that will get us the answers we need. For those that won't debate, they then forfeit the right to participate. And there are those that see only their dogmatic ideology as being the right way to solve all problems. Neither is that wise or American. Especially for America of the 21st century.

Ed Schultz offered a great idea on his radio program. he said he would be willing to open his show, actually give up a whole three hour show, one per candidate, to any who wished to air their ideas about solving this country's problems. In response to that, I wrote to the Edwards and Kucinich campaigns, encouraging them to jump on this offer and start making the change.

I am sad to say that I got canned sound bite, or the e-mail version of it (e-rhet?), in response. So I am asking any readers to do two things. Start contacting the different candidates and asking them to contact any and all radio hosts for time slots to explain in detail how they would solve our major problems. Then contact the radio hosts to offer up their slots.

Do I think this will eliminate the emotional partisanship that fuels the vitriol from the political extremes? No I don't. But it will start if we start to make noise, and request of our candidates and radio shows what it is we the people, we the consumers, want of those who serve us. The Customer is still the King folks. It's our money they want. Let's tell them what we want in exchange for it.

And let's learn to shelf our emotions when we talk to our fellow citizens. Problems usually have facts that explain what the problem is. And well thought out solutions to those facts can be applied. Not everything the conservatives believe in is right. Not everything the liberals believe in are wrong. Maybe in our discussions we can arrive at a solution that includes a little of both camps. It's worth trying.

As William Martin wrote: "In America, we wake up in the morning, we go to work, and we solve our problems."

We, we we. and I say this to myself as well as you, "We the people."

Friday, August 17, 2007

Free market - Part 3

As you may recall, the inflation numbers the Feds post are stripped of the "volatile" numbers of food and energy prices. You may recall the secret energy meetings that Dick Cheney chaired back in the early part of the century, from which came our domestic energy policy; another secret.

However, what isn't secret is that gas was about $1.50 a gallon when Bush took office. Not too many months ago it was $4 a gallon in some parts of the country and has since dropped. In that time of course Exxon posted huge profit numbers. What impacts the consumer though is that our gas prices alone have inflated a little less than 20% per year since Bush took office. This is one of those pocketbook numbers that they don't like to report in the official numbers, but greatly impacts any who drive themselves to work, and those who need commercial air flights to travel to work.

In an August 16 Seattle Times
article, there is a detailed report of the cost of food just in the last year. According to the labor Department, food prices rose 4.1% in the last year alone. Eggs, a nice cheap easy to fix meal, went up 33.7%. Milk 21.1%. Pasta 7%. Potatoes 5%. This is the stuff that poorer people eat, mainly because they are at the cheaper and easier to fix end of the food chain. Considering that the number of those living in poverty has grown since Bush took office, this number not only greatly impacts them, it has a less but also serious impact on those living in that area between poverty and the median wage.

Here's the upshot. Unless your wages matched inflation alone, which has been right around 6% per year when you factor in the food and gas (let's just leave out health, heat and air conditioning costs for now, you can extrapolate those numbers in mentally), you lost money for that year. To quote the article, ""...which may go a long way to explain why, despite healthy job statistics, Americans remain glum about the economy."

Healthy job statistics?

Considering that to maintain Adam Smiths ideas of capitalism, which the neo-cons embrace, wages must remain low. Hence they fight living wage legislation everywhere. It also reveals why Americans are glum. Wages during a capitalist loving administration are apt to be forced lower. That can be done by allowing illegal immigrants to cross the border, regardless of how many terrorists may cross at the same time. It can be done by out sourcing jobs to foreign lands, thereby eliminating competition for high wage manufacturing jobs. It can be done by lobbying efforts that resist minimum wage and living wage laws. So in the face of stagnant wages, inflation then has a negative impact on the wealth of most Americans. it costs too much to live, and so nothing gets saved.

I can hear the outcry already: If Americans lived less on credit cards used to buy toys, then everything would be better. And part of that is true. Yet part of the reason credit is so easily available is because the rulers that be want to separate you from as much of your money as they can. Hence they allow credit card companies to draft legislation for bankruptcies which makes rules that allow those credit companies to charge huge interest rates, make credit available to anyone(just listen to recent mortgage and re-fi ads), and then make it impossible for them to get out of it when they get in over their heads as they are encouraged to do. Remember, it was Bush that stated that the sacrifice Americans needed to make after 9.11 was to go shopping. Get in your car which uses gas, go to the mall and buy more products made overseas with cheap labor. Not even all the parts in your GM car are made in America, and increasingly the labor used to build the mall is illegal and low wage. It all works out beautifully for the wealthy owners.

And go shopping for what? Computers? Cameras, or cell phones? Yes, the prices on these things have gone down. But when you hear that, you must remember your own budget. How many cell phones do you buy every week? How many computers? Gadgets are getting cheaper as technology gets better, but they aren't your basic budget items. Food is, on a much larger percentage basis than gadgets. So is gas, and electricity for heat and air conditioning. Those pocket book items which are left out of official numbers.

So how free has our economy become? Well, if you're losing money every year because your wages aren't keeping up with true inflation, then it isn't free. If Americans were in a position where they could put aside a three to six month nest egg for emergencies, and save regularly for retirement over and above the cost of living, then we would have a good economy. One that would hum right along. Think what that would take for you to live like that. Just think what the American dream of a house, emergency fund, retirement fund, let's say one car despite the need for two salary families any more, and the necessary evils of health insurance, homeowners insurance, car insurance, and the utility bills that would go along with that house. How much per hour would you need to make? Then add kids, and future college costs....

I'll make that my next post, based on median numbers. But I think you get the picture. if it's more than you make, consider rethinking capitalism. Consider protecting the workers of America. And remember that the power is still in our hands.

Wednesday, August 15, 2007

This Market Isn't Free Redux

I was just reading a CNN report about stocks dipping lower this morning. No surprise there. The dismal housing market will continue to do that for a while.

What makes me shake my head though is the inflation figure that the government reports that strips out "volatile" food and energy costs to consumers. What sense does that make?

Consider that the problems in the housing market are based on the inability of consumers to pay off their debt. Where does then the rest of the money these consumers make go? Would anyone care to venture that a good portion of the average American(a country with a known obesity problem) goes into the food budget? And energy costs? What do you think is covering the costs of air conditioning, heating, running appliances, computers, lights, and making their gas guzzlers move along the highways? A mere 1% of their budgets?

This is where "economists" of the governmental variety miss the mark. These inflation numbers aren't close at all to reality. Add the "volatile", and never going down food prices and the up-and-down fuel costs and inflation will look much worse than the numbers reflect. Add to that the ever escalating cost of health care (remember the maladies associated with obesity) and suddenly it's a different world. An inflated world that the Feds will make worse as the dump more money into the banking system, thereby contradicting the free market theory and creating inflation(too many dollars chasing too few goods and services).

This market is the result of unregulated greed and poor fiscal practices. It reflects spending what you don't have, robbing the Treasury, and priorities that do not reflect the Americans these politicians represent.

The cons have been boasting boom economy forever, and the lefties have been saying the bubble will bust. Seems the cons are wrong, and not for the first time. Nor the last. But their days in power and their return to power are slipping away with every point the market slips, and every bit of news that uncovers these unregulated and risky financial operations that line the pockets of the few at the expense of the many.

Saturday, August 11, 2007

This Market Isn't Free

Not by a long shot!

Just so you know, I'm an average working guy. Well, actually a lucky working guy; my employer provides a decent wage and insurance on top of that. So my understanding of the nuances of this American economy are questionable. But the big picture is understandable by most folk.

The cons like to tell us they believe in the free market, meaning of course free from the intrusion of government actions. However, this weeks end at Wall Street proved otherwise. On the basis of the now glaring failure of the housing market, and the evidence the bubble is about to burst and effect markets world wide, it tumbled quite a bit over the last two weeks.

Thursday saw a sell off based on the actions of the French banking system. Friday started into a freefall again, and the government intruded and saved the day. The Feds said they would "infuse" tens of billions into the economy to shore it up. But that's government action. So where were all the conservative voices to cry out against interference in the free market? The fed action will only help things for a little while because the problem exists at the "we the people" level. Not the banking system level, and not clueless Wall Street.

So long as the wealth of the wealthiest is protected by government actions, these hypocrites will cry about a free market all day. But the cost of this "free" market is staggering. Just remember the savings and loan debacle of the eighties. Which incidentally had a Bush family member as a major player in that fiasco.

This market isn't free because the housing bubble is going to burst and there will be a loss of assets and homes at a rate we haven't seen for a long time. The three worst areas facing foreclosures right now are Las Vegas, Detroit, and Newark. And mind you, these problems are just starting to make themselves felt. This market affects two of the three hallmarks of what used to be the economic benchmarks. Those three used to be automobiles, housing, and appliances to go in those houses. We all know now the sad shape of American automobile markets. Sad unless you're the CEO of Ford that is. He gets a 28 million dollar bonus for a third of a year while others are laid off, and then they recall 3.6 million defective vehicles.

So if housing slumps, so will the big appliance makers. Which most likely will affect Chinese workers for the most part. I'm not certain anymore just how many appliances are still built in the US. However, if orders drop off in the US, then profits drop off accordingly. That's the sort of news Wall Street doesn't like. And with Rupert Murdoch in charge, maybe we won't even hear it!

Moving on now to another costly expenditure that has been long ignored; infrastructure. With the explosion of the steam pipe in underground New York city, and the collapse of 35W in Minneapolis, it has been brought to our attention that our infrastructure is not in the best condition. According to the American Society of Civil Engineers(ASCE), Americas infrastructure is in extremely poor condition. If you were a foreign or domestic investor, would you have the infrastructure needed to support your business? How many foreign assets were affected by 35W falling into the Mississippi? How significant will the domestic economy be impacted by the collapse? And the ASCE claims that our energy grid, water systems, dams, bridges, schools, roads and aviation systems all across the country need significant investment to come up to "good" condition.

How free will this be?

And lets look at another category of the booming economy the cons love to talk about. The savings rate. That's right, the rate that Americans save money. Back in the eighties I decided to try my hand at insurance and securities sales. People in this country had a bad habit of buying expensive life insurance policies that had poor rates of return, and charged you for "borrowing" your own money. They called them whole life or universal life policies. And back then, the savings rate for Americans was less than 5%. Today, for the first time since the Great Depression, Americans are actually saving at a negative rate. In other words, they are spending more than they make and save combined.

Now, seeing how companies that go bankrupt are wiping out pension plans while providing golden parachutes to executives, it's had a huge impact on saved money. What many don't realize is that saved money is the resource that government used to use, as well as the commercial market, to fund itself to grow. But as savings declines, than Uncle Sam has to go off shores to borrow from countries like Japan and China. And the national debt climbs into the ionosphere.

How free is that market?

And why do we have the debacles we have now? Partly because of the Reagan administration beginning the rollback of government market regulations designed to protect the citizens and prevent greed and stupidity like that which happened at Bear Stearns from happening.

So next time a con blurbs out the advantages of a free market, educate them to the real market of the real people.

Our "market" isn't free at all.