Category Archives: Politics and government

The Blare of the Brass Trump

“There are two sides to a trumpeter’s personality.  There is the one that lives only to lay waste to the woodwinds and strings, leaving them lying blue and lifeless along the swath of destruction that is the trumpeter’s fury.  And then there’s the dark side.” Anonymous

TrumpMuch has been written of the Trump phenomenon, about ignorant, angry, racist voters who have taken more than enough and can’t take anymore. Far deeper and more intransigent than that, I’m afraid. The glib Donald proposes no real or even thoughtful solutions – only simplistic pandering, and he displays little depth of knowledge in any of the subjects about which he harangues. How is a privileged narcissist, a vain bully whose signature is insult and schoolboy humiliation of anyone who voices even minor criticism, successfully pretending as a “tell it like it is” savior of the common man? What vein is he mining?

Peggy Noonan this weekend starts the conversation best, I think, in her Wall Street Journal column, and I recommend it to you: “Trump and the Rise of the Unprotected.” She writes that the divide between the “protected” (well to do, influential, comfortable and safe) and the “unprotected” (everybody else) has widened to nearly unbridgeable and is intolerably frustrating to those on the vulnerable side. Noonan suggests that the protected includes most politicians, academia, the majority of both conservative and progressive media, the educated and the wealthy – defined as anyone not constantly worried about paycheck to paycheck necessities for their families.

The protected have no insight into what the majority of people deal with on Monday morning or in middle of the night sweats; the unprotected are in frigid water without a lifeboat while the Titanic goes down. The elite have for the most part abandoned public schools for their own children except for lip service to the teacher’s union. They converse smugly among themselves about the witlessness of the average person along with some occasional painless and riskless tsk, tsking about minorities and the disadvantaged, who need to be rescued by the government or free enterprise or some combination thereof. The protected and unprotected stand on the precipices of opposite sides of a canyon and shout bumper sticker slogans at each other.

Trumpism is not a joke, much as we wish it was, and neither is it an eruption without a cause. We can see it as the other side of the same coin as Obamaism. We long for a demagogue to lead us out of the bewilderment of our own inability to grasp what’s really going on. We are awash in information and immediacy of communication and bereft of understanding and wisdom, overloaded with bits of knowledge, and unable to piece together a meaningful picture of the whole. So we grasp at the self-serving kindness of strangers and fantasize that the expert, the manager, the technocrat can pick their way through the obstacles that no one else understands and bring us safely home.

“The vast accumulations of knowledge – or at least information – deposited by the nineteenth century have been responsible for an equally vast ignorance. When there is so much to be known, when there are so many fields of knowledge in which the same words are used with different meanings, when everyone knows a little about a great many things, it becomes increasingly difficult for anyone to know whether he knows what he is talking about or not. And when we do not know, or when we do not know enough, we tend always to substitute emotions for thoughts.” T.S. Eliot, from the essay, “The Perfect Critic”

G.K. Chesterton wrote over a century ago in his brilliant short essay on juries, “The Twelve Men,” [i] The Fabian argument of the expert, that the man who is trained should be the man who is trusted would be absolutely unanswerable if it were really true that a man who studied a thing and practiced it every day went on seeing more and more of its significance. But he does not. He goes on seeing less and less of its significance. In the same way, alas! we all go on every day, unless we are continually goading ourselves into gratitude and humility, seeing less and less of the significance of the sky or the stones.”

Our culture is in great danger of intellectual and moral surrender to the expert, to the manager whom we believe knows all and can fix all, like Donald Trump, or for that matter, Barack Obama. We retreat from an overwhelming onslaught of data and information and cede authority to those longing to assume it. We flee into distractions, entertainments and the frivolous because we fear we cannot bear or understand what it is we need to understand and to bear. Mistaking management for leadership, we willingly turn over our governance to those we hope see the light that we do not.

“Trumpet players see each other, and it’s like we’re getting ready to square off and get into a fight.” Wynton Marsalis

 

 

 

[i] See free online version of Chesterton’s collection, “Tremendous Trifles” from the Gutenberg Project: http://www.gutenberg.org/files/8092/8092-h/8092-h.htm#link2H_4_0012

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A Wilderness of Error

Jonathan Gruber explains what's best for us

“The right thing can seem so wrong and the wrong thing seem so right that we easily become lost, to use Poe’s exquisite phrase, in a wilderness of error.” A Dancer in the Dust, Thomas H. Cook

Unless you have been visiting abroad, say in the Galapagos, you read about or watched Jonathan Gruber, an author of Obamacare. If you have been in the Galapagos, here is a two minute synopsis: Grubergate in Two Minutes from “American Commitment.” Former Speaker of the House, Nancy Pelosi, crowed once that the bill would have to be passed before we knew what was in it. This was not due solely to the closed door machinations and deals, cobbling together a bill meant to be ironed out in joint committee, but frozen, partially done, by the election of Scott Brown. Nor was it due entirely to being over 2,500 pages long and spawning tens of thousands of pages of regulations. The great majority of Americans and American legislators didn’t know what was in it because a.) Obamacare ACA was calculated to obfuscate, and b.) We were “too stupid” to understand it anyway, which was, after all, just as well. As Dr. Gruber clarified to his elite colleagues in academia, “Lack of transparency is a huge political advantage.”

“Speak boastfully no longer, nor let arrogance issue from your mouths.” 1 Samuel 2:3

Obamacare with all its errors in design, the subterfuge in its passage into law and its flawed implementation is a model of progressive mischief, but the ACA is also a metaphor for far more dangerous myopia. Lest we be mistaken, the hubris of the progressive “expert” knows few boundaries. The progressive is willing and able to take us where we ought to go, whether, or perhaps especially, when we do not know enough to want to go there. From their perspective, a stupid and ignorant electorate is best able to be led by those fully prepared to lead them. “Progressive” has become a self-contained oxymoron.

“The trouble is that we always define ‘forward’ as moving in our direction…but not everyone can, and not everyone should.” A Dancer in the Dust, Thomas H. Cook

Norman Angell wrote “The Great Illusion” in 1909 and was awarded the Nobel Peace Prize for his work in 1933. His premise was that large scale war in modern times was futile because of the complex economic interdependence of all the major nations; the cost even for the winners would be too great. His work particularly influenced English leadership, convincing them that even the “Hun” would not be so foolish. They remained in hope almost to the day German troops invaded Belgium and headed towards Paris. Treaty bound to Belgium, the United Kingdom watched as they were inexorably drawn into the beginning of World War I, the bloodiest war in human history until that time. The infirmity of purpose that encouraged the Kaiser was repeated with Neville Chamberlain’s vacillations twenty five years later prior to World War II. Adolph Hitler read the signs of his enemy’s hopeful delusion and warmed up with Austria and Poland before striding down the ChampsÉlysées. The butchery exceeded its predecessor. And so it goes.

For leaders to misunderstand their enemies by trusting optimistic and irresolute illusion kills faith in that leadership as well as the best of the youth under its stewardship.

“In the month of August 1914, there was something looming, inescapable, universal that involved us all. Something in that awful gulf between perfect plans and fallible men that makes one tremble.” Barbara Tuchman, “The Guns of August”

This week we were entertained with the administration’s attempt to placate the offended leaders of almost all major nations. The president once again led from behind by failing to send an appropriate level of representation to the solidarity march of those leaders in Paris after the Charlie Hebdo radical Jihadist attack. To make up for the gaffe, Secretary of State John Kerry gave a stiff hug to Francoise Hollande, the French Premier, and Kerry doubled down by bringing along a grinning James Taylor to sing his sappy “You’ve Got a Friend”. Bad sixties coffee shop folk singing to sooth all insults. If we hadn’t been inured to such awkwardness with six years of this tomfoolery, it would be embarrassing. Now it seems like just another day at the White House. One wag suggested in lieu of Taylor, it should have been Judy Collins with “Send in The Clowns.”

The relevance is not only the tone deafness, but the worldview, the progressive desire to see things as they would hope them to be, irrespective of how they are. Whether Hillary is entreating us to empathize with the Jihadists, Howard Dean denying that the Paris murders were carried out by Muslims or Barack Obama persisting in calling the Fort Hood killings “workplace violence” and Jihadist butchery as “radical extremism” not necessarily unlike  Timothy McVeigh or the demented Jim Jones.

Jihadist violence is inherent, and if we refuse to acknowledge that there is a war, we are probably losing. Releasing Gitmo Islamists who immediately resume killing us or negotiating with Iran over their nuclear ambitions are all of a piece. To the committed Jihadist, there is one dichotomy: dar al-Islam (The House of Islam) and dar al-harb (The House of War), the realm of peace and Islam, and the realm of war: that is everybody else. Leaving the rest of us alone, peaceful coexistence and religious tolerance is as impossible and foreign to them as government by, of and for the people, as constitutional law is to sharia, as democracy is to the Caliphate. Conversion or the sword are the options.

 “And fight with them until there is no more fitna (disorder, unbelief) and religion should be only for Allah!”  Quran (8:39)

“And kill them wherever you find them, and turn them out from where they have turned you out. And Al-Fitnah [disbelief] is worse than killing…  Quran (2:191-193)

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Ponderings and Conundrums – musings on a cold winter day

“To understand the workings of American politics, you have to understand this fundamental law:  Conservatives think liberals are stupid.  Liberals think conservatives are evil.”  Things That Matter, Charles Krauthammer (reprinted from the Washington Post, July 26, 2002

When we discuss economics, politics or social trends at family gatherings, in the coffee break room or with friends during holiday gatherings, the polarity seems more intense every year, not less.  Talk flows back and forth with hammer blows of conflicting facts and less and less listening from either side.  How do we resolve the seemingly irresolvable?  How do we compromise on issues built on inviolate, but contradictory core values?

The progressive decries the widening gap between the rich and the poor, which is undeniable.  But over nine million formerly well paying industrial blue collar jobs have fled to emerging second and third world countries, and with production goes innovation.  Those nine million jobs have been replaced for the most part by service sector jobs or retail, and rare is the instance that those relatively low skill jobs pay anywhere near as much as a trained machine operator or union car assembler.  The gap grows, but it is facile to make the assumption that the exploitive business owner shoulders all the blame.  We who benefit from lower prices at the cash register vote with our wallets and with the unintended consequence of hurting the highly paid, middle class blue collar worker.

Textile mill of the early twentieth century in New EnglandDemonstrations at Walmart to pay its workers more than the current average $17,500 sound rational on MSNBC.  The underlying economics that drive the decisions by management to set wages are more complicated.  Stocking shelves at Walmart with made in China or Mexico sweaters cannot pay as much as practiced loom operators knitting those sweaters once made in the former textile mills of the Blackstone River Valley in Massachusetts and Rhode Island.  Raising the minimum wage reduces hiring and harms the opportunity of those with few skills entering the workforce, where they will learn how to show up on time, to work diligently and improve their proficiency.

If Walmart decided tomorrow to raise the pay and benefits of all their workers $6,000 per year, it would no longer produce a profit for its owners and would not be viable as an ongoing business, having insufficient resources to compete, replace trucks and pay the light bills.  If they raised their prices to accommodate the higher pay, the customers would soon be over at BJ’s or K-Mart buying their Chinese made sweaters and jeans where shelves are stocked and cash registers staffed with lower paid workers.  Or consumers would buy fewer sweaters because they can’t afford the higher prices.

Raising the minimum wage to a “living wage” is terrific as a campaign slogan, but implementation without repercussions is a tricky business.  NAFTA is a two edged sword.

“Cowboys games at AT&T Stadium can consume up to 10 megawatts of energy, more than is used in three hours by the 3.7 million residents of Liberia.” Kevin Kerr, Sports Illustrated 12/30

American “exceptionalism” is a commendable slogan and core belief as well, but can our citizens reasonably expect that having 4.5% of the world’s population and consuming one-third of the world’s paper, a quarter of the world’s oil, 23 percent of the coal, 27 percent of the aluminum, and 19 percent of the copper is sustainable in a global economy with the other 95.5% wanting their fair share of resources?  Do we believe it is prudent governance to hinder development of domestic sources of oil through fracking while continuing dependence for oil on those who hate us?  Does it make sense to hinder a pipeline from our closest neighbor and ally, which own of the third largest reservoir of oil reserves in the world?  Do we really believe this will prevent Canada from selling this oil?  The oil will be sold, and likely to those who burn it far less efficiently and cleanly than our more closely regulated industries and vehicles.  Does this truly advance the cause of fewer hydrocarbons poisoning the atmosphere?

“I have seen great intolerance shown in support of tolerance.” Samuel Taylor Coleridge

Under the flag of “diversity,” the personal freedom in Western culture and in the United States has been under attack for nearly fifty years:  especially the freedom to live out religious beliefs that do no harm.  Jack Phillips, a baker in Colorado, politely declined the business of a same-sex couple who wanted to buy a wedding cake.  The Left espouses diversity of belief and practice except when it comes to anyone who disagrees with the tenets of their own secular faith.  Rather than simply going to another baker (of whom there are many), the couple sued Mr. Phillips and received a court judgment.  He was fined.  If he refuses to pay the fine or bake a cake, he can be sent to jail.   This is not discrimination in the workplace or hiring practices or bullying or any of the other injustices that have been redressed in the courts.  Jack Phillips chose not to participate by baking a cake and was punished by the court.  How soon will churches be forced to perform marriages that violate their core beliefs?  Will those churches have to get out of the civil marriage business, as the Catholic Church was forced out of the adoption business, closing down the largest adoption provider in the country?

The American Civil Liberties Union recently sued a Catholic hospital to force it to perform abortions.  The Left for years had a mantra stating that, “If you don’t like abortion, don’t have one.”  Apparently that doesn’t hold true if a hospital chooses not to perform one.

“I’ve always felt that a person’s intelligence is directly reflected by the number of conflicting points of view he can entertain simultaneously on the same topic.” Abigail Adams

Mrs. Adams was a superb communicator married to a superb communicator.  Their letters to one another are a priceless legacy.  She was also a lot smarter than most, including most especially me.  I have a difficult time, as do many, trying to “entertain simultaneously conflicting points of view.” – More than ever when those points of view are almost fundamentally irreconcilable.  Compromise may not be possible.  e.g.  How do we reconcile an issue when one group sees only “women’s reproductive rights” (who can oppose someone’s constitutional rights?), and the opposition sees murdered babies who merited protection and nurture?   A Solomonic solution is not possible.

How do we reconcile political viewpoints when the Attorney General lets slide Black Panthers caught on video tape intimidating voters at polling places, and then goes hard after the Little Sisters of the Poor for upholding their rights of personal conscience against the Obamacare monolith mandating abortifacient drug coverage?  How do we find compromise when one side is convinced the opposition is naïve and a little stupid, and the other side sees their opponents as evil incarnate?  How do we reconcile opposing views in which one side perceives exponentially expanding government both in size and scope as a grave danger and the other envisions it as the road to Utopia? There remains little common ground upon which to stand.

This post started with a Charles Krauthammer quote, and it will end in one from a 2012 Washington Post column reprinted in “Things That Matter.”  Read the book.

“(President Obama and progressives are) equating society with government, the collectivity with the state.  Of course we are shaped by our milieu.  But the most important influence on the individual is not government.  It is civil society, those elements of the collectivity that lie outside government:   family, neighborhood, church, Rotary club, PTA, the voluntary associations that Tocqueville understood to be the genius of America and source of its energy and freedom.

Moreover, the greatest threat to a robust, autonomous civil society is the ever-growing Leviathan state and those like Obama who see it as the ultimate expression of the collective.”

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Off the Rails

“The only way to be sure of catching a train is to miss the one before it.”  G.K. Chesterton

train tracksThroughout my nearly forty years in the lumber business, I have taken on many responsibilities from time to time.  One of the sidebars that intrigued me was my industry’s sometimes shaky marriage with railroads.  Demurrage charges accrue when the local railroad sets a car of freight on our siding to be unloaded, and the receiving yard takes too long to unload the product and release the car back for pickup.  Demurrage fines can be dear, railroads are enthusiastic to assess them, and the owners of lumber companies hold managers accountable for expediting unloading to avoid them.

Western fir plywood is still a frequent rail traveler, although in times past before manufactured engineered wood products came to the fore, Canadian or West Coast Douglas Fir timbers rode the rails and landed in one yard or another every day.  Now like most things, the set and release are done on line, but I remember often calling a bored dispatcher in some remote dingy railroad office to let them know to pick up their empty.  We kept a careful log in a three ring binder tracking car numbers, dates in and out, product and related purchase orders to the mills to document not infrequent disputes over charges — especially during the reign of the late, unlamented federally run Conrail.

“If you board the wrong train, it is no use running along the corridor in the other direction.”  Dietrich Bonhoeffer (Lutheran theologian and member of German Resistance, murdered by the Nazis)

When diesel was cheap in the seventies, many small railroads lost a lot of business to more flexible trucking companies.  In bankruptcy or near bankruptcy, some of the well connected owners of these railroads lobbied the government hard to bail them out, which, of course, it did, nationalizing the operations of poetically nostalgic names like Erie Lackawanna and Lehigh & Hudson River.  $7.65 billion later and losing nearly a million dollars a day, it was privatized by President Reagan and sold to Norfolk Southern and CSX.  Both companies to this day are chugging along with multibillion dollar annual profits.  Shares for both are trading near their all time highs.

The complexities undergirding their success are beyond the scope of a blog post, the obvious point is that private business out performs the bureaucratic, cholesterol clogged arteries of government run enterprises.  Profit, necessary cost efficiencies and the capital magnet of profitable companies drive success.  Self perpetuating bureaucracy, less than accountable cost structures and the ability to either print or borrow unlimited funds drive more Kafkaesque fiefdoms.

As the rollout of Obamacare continues to make bad news, we are reminded of other train wrecks of Federal programs.  We have yet to see the “rest of the story” when the mandate for small businesses is finally allowed to kick in.  The administration illegally breaks off pieces of the unmanageable bill and postpones other parts time and again to time the next disaster until after the election cycle.  But I suppose pain delayed and deferred is better than immediate suffering.

“Neither a wise man nor a brave man lies down on the tracks of history to wait for the train of the future to run him over.”  Dwight D. Eisenhower

What has me worried next is the nationalization of medical records set for October go live, part of the Patient Protection and Affordable Care Act (the irony in the bill’s name is beyond imagination).  The story this week of Target’s insecure records that resulted in somewhere between 70 and 110 million customers gives us pause.  Credit card numbers, PIN authorization codes, names, addresses and even email addresses were hacked.  Presumably Target has the most up to date security for these records available, but…..

Another story this week told of the vulnerability of offsite access to databases through Virtual Private Networks.  In recent weeks we’ve read of NASDAQ and Snapchat being hacked.  None of these companies lack Information Technology sophistication or concern for the privacy of their records.  Target is thought to be an inside job.  As Edward Snowden showed with his million plus record theft of our country’s deepest secrets, all it takes is one person with an agenda and a grudge.

Do we think that every county hospital and doctor’s office with access to a national database will have the security and IT capability of NASDAQ or Target?  The national database of medical records will tell who has AIDS, who has been treated for STDs, who has struggled with depression or bulimia or had an abortion or breast enhancing surgery, which job applicant has an expensive history of drug use or cardiac problems, members social security numbers – all of it will be there.  The intention to make more accessible and easily transferable all of our health records may or may not be benign to our brave new world, but it will undoubtedly leave us vulnerable.

“Concentrated power is not rendered harmless by the good intentions of those who create it.” Milton Friedman (Nobel Memorial Prize winning economist)

This week we are told that the administration finally chose not to renew the contract to the Canadian company, CGI Group, which was hired to oversee key aspects of the egregious healthcare.gov rollout.  Nobody got fired, including the inept Secretary of HHS, Kathleen Sibelius. Hundreds of millions were spent with CGI, who’s Executive Vice President, Tony Townes-Whitley, went to Princeton with Michelle Obama, belonged to the Princeton Black Alumni association with her and donated to the Obama campaign – a fortuitous coincidence no doubt.  Now after one of the most visible IT debacles in history, they don’t get their contract renewed.  No penalties, no claw back, no anything.

The House of Representatives on Friday passed the Health Exchange Security and Transparency Act with all Republicans and 67 Democrats.  The bill would require the health exchanges to notify victims of identity or information theft within the exchanges.  The administration lobbied Democrats hard to vote against it.  The self proclaimed most transparent administration in U.S. history opposes the Security and Transparency bill and threatens to veto it if enough Democrats in the Senate are persuaded by their nervous constituents to join their House colleagues.

As dear Alice wondered after going down the rabbit hole, it gets curiouser and curiouser!

 “This train don’t carry no con men, this train;

This train don’t carry no con men, this train;

This train don’t carry no con men,

No wheeler dealers, here and gone men,

This train don’t carry no con men, this train.”  This Train is Bound For Glory, Woody Guthrie

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Stone-enders

Eleazer Arnold's Splendid Mansion

Eleazer Arnold’s Splendid Mansion

Walking through Lincoln Woods, we emerged onto Great Road in Lincoln, RI.  Looking for a place to warm up, we happened upon Arnold House and took the short tour with a member of the historical society.  It was built in 1693 and originally called by the local residents “Eleazer’s Splendid Mansion” after its first owner and builder, Eleazer Arnold, who farmed the surrounding 140 acres.  His splendid mansion even after additions over the years is insignificant compared to the overwrought and pretentious McMansion of the early twenty first century. Gracefully proportioned lines fit perfectly with a New England landscape.  “Stone-enders” modeled the former homes in western England of the seventeenth century immigrants.  The west end of those houses consists of three feet of four to fourteen inch stones laid tightly and mortared together; the remainder of the structure was wood post and beam framed with wooden pegs and hand forged nails.  Leaded glass windows were small to be more easily defensible from indigenous raiders and to limit winter air leaks around the glass.  Many of the original wide pine boards, the oak carrying beams and three fire scorched stone fireplaces with their stone hearths are still in place.

The massive stone end is coated on the exterior with local white limestone mortar and tapers from bottom to top, providing vents for multiple walk in fireplaces – one on each floor.  The west end orientation in England presented a staunch bulwark to retain heat and defeat the prevailing winds.  In Lincoln, the stone faces to the west as well, paying no heed to the fiercest storms in New England blowing in from the northeast.  Even though the Arnolds had lived in early Rhode Island for over twenty years, apparently common sense and local conditions had little chance against traditional practices.  The Rhode Island stone-ender is a metaphor for the human condition of “this is the way we do it because this is the way it is done.”

“The pessimist complains about the wind; the optimist expects it to change; the realist adjusts the sails.”  William Arthur Ward

Returning back through the New England woods, I was struck by the persistence of this metaphor in many aspects of our culture and especially in government.  The “audacity of hope” is a conspicuous illustration.  In 2008 Barack Obama railed against the dysfunction in Washington that he was going to remedy. Two groups were singled out: “the typical politician playing the same old tired cynical games,” craving reelection fund money and the oft maligned lobbyists who used “money and influence (to) drown out people’s voices.”  Reiterating this catchphrase incessantly, he boasted that his campaign had not taken a dime from lobbyists or Political Action Committees. He would shun special interest donations to his campaign and find his money from “the working men and women who dug into what little savings they had to give five and ten dollars to this cause.  Supporters had an opportunity to rally around, “Not this year.  Not this time!”[1]  Together with Obama, they could build “a nation healed.  A world repaired. And an America that believes again.” Thrilling and “fundamentally changing America” with “hope and change.”

“Hope is a soufflé that doesn’t rise twice.”  Bill Galston, Deputy Assistant on Domestic Policy to President Clinton and Senior Fellow of the Brookings Institute

This glittering vision was built on carefully parsed sentences that skirted the truth.  He broke George W. Bush’s fund raising records by a large margin.  Bush’s money came from big fossil fuel energy, the defense industry and doctors.  Obama did collect from his little guys and his website; however the foundation of his finances came from Wall Street, Silicon Valley and lawyers.  His largest contributors were corporations, large universities, government agencies, their employees and the immediate family of owners or employees; among them were University of California, Goldman Sachs, JP Morgan Chase, Microsoft, Google, IBM, General Electric, Morgan Stanley and the U.S. Government (especially the Department of Justice).  Millions also were raised by “bundlers” in frequent fundraisers attended by President, and from Planned Parenthood and the unions, especially the Service Employees International Union.   Not their lobbyists, but direct from the source.  One of the most influential lobbyists on K Street in Washington is Tony Podesta.  He said, “Obama doesn’t really mean it, and we’re not taking any of it personally.  We’ll be back to business as usual after the election.”  This proved prophetic understatement.

Another prominent lobbyist put it this way: Obama talks about special interests and their hired guns, but then he only bans the hired guns.  “It was like boycotting a criminal lawyer, then going partying with the defendant.”  The access to the White House by these bundlers and companies is well documented – not quite sleeping in the Lincoln bedroom, but immediate admittance nonetheless.

The dirty little truth about most legislation on the federal and state level is that it is usually written by staffers and lobbyists in small ad hoc committees.  Much of the convoluted 2,400 page Obamacare Affordable Care bill was drafted on behalf of the administration by the staff of retiring Democrat Senator Max Baucus, who over the years received $3.8 million in health care industry campaign contributions.  In order to secure sufficient Democrat support in both houses, it was necessary to forge two major agreements with the interests that provide the money for the new reality of “perpetual campaigns.”  The first deal was cut with the health care industry shutting down any one payer government competition and conscripting for the insurance companies millions of new subscribers.  The second one guaranteed “big pharma” would not face government negotiations for lower Medicare drug costs and banned importation of competitive Canadian products.  Without these arrangements, costing taxpayers billions, the ACA Obamacare bill never would have been enacted.  A senior advisor to the president was heard to say, “Obama has just caved without firing a shot.”

Timothy Geithner, Treasure Secretary at the time, wrote the white paper upon which much of the second major piece of Obama’s first term was based, the Dodd-Frank banking regulation bill,  which enshrined in law the “too big to fail” protections for big banks and financial institutions.  During the writing of this bill, Mr. Geithner met or spoke with Lloyd Blankfein, CEO of Goldman Sachs, the second largest campaign contributor, thirty eight times, eight times as often as he met with either Harry Reid or Nancy Pelosi.  And so it goes.

 A cynic might say that the Barack Obama of Valerie Jarrett, Rahm Emmanuel, Rod Blagojevich and the old Daley Chicago machine is a clever charlatan, well trained in Illinois money and power politics.  Or is it that his aloof (some would contend disinterested) and inexperienced management style left him defenseless to the big money ways of Washington?  Like a man in a dream standing on the beach watching his youthful ideals drown, and wondering why he had forgotten how to swim.

“He is trying to recapture his innocence, yet all he succeeds in doing is to inoculate the world with his disillusionment.”  Henry Miller


[1] Many of these quotes are taken from “Time to Start Thinking – America in the Age of Descent” 2012 Grove Press by Edward Luce 2012.  Mr. Luce is a long time journalist with the Financial Times of London.

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Leverage

A decade or so ago, some friends undertook the arduous journey to adopt their daughter, who spent the first fifteen months of her life in a Moscow orphanage.  The journey was arduous in all ways possible – mileage, time, financially, intellectually demanding to wend their way through the arcane rules and most especially, emotionally.  On their initial visit to the facility, they found most of the younger children were minded in a small enclosed area with a few toys to claim, if they could be held against all competition.  The facility housed over a hundred small clients, a couple of dozen or so under the age of two.  When they first spotted the young beauty that was to transform their lives, the fifteen month old glanced sideways while on the changing table and made eye contact across the room.  That ability to connect with those who were her life line was a skill, either learned or inborn, that conveys to her a gift beyond reckoning and persists into her precocious pre teen personality.  She can take over a room like brightness draws moths into the light.

In Moscow, she competed with a score or more toddlers and infants for the haggard, stretched thin attention of two full time attendants, each of whom worked a twelve hour shift every day.  One person at a time was on duty for changing, food, health care, teaching and loving.  They did their best; they really did.  Learning toys were scarce, food was sparse and survival skills important.  An orphan who prospers learns early to compete, to persist and to make her way.  Her intelligence and persistence were the primary attributes we noticed when we  met her in our friend’s house shortly after they returned home.

For adopting parents, protocol was for at least two visits of a fortnight each, separated by a period of time, usually a month minimum.  The first one was intended for selection of their new family member and early bonding; the second was to complete the paperwork, spend more time with the child, and usually followed a vetting process.  Our friends were able to convince the adoption authorities that a second trip would be prohibitively expensive financially and more importantly expensive for their schedules, since they were both self employed.  They remained in Moscow for twenty eight days at a cost exceeding thirty thousand dollars, but when they got on the first leg of their Aeroflot flight home, there were three of them.

President Vladimir Putin signed a bill Friday banning U.S. citizens from adopting Russian children, raising tensions with Washington as the Obama Administration is trying to win Moscow’s support to end the war in Syria.  Russian officials portrayed the latest legislation as a tit-for-tat retaliation against a new U.S. law that seeks to punish Russians accused of human-rights violations.

Moscow’s legislation—which also bans U.S.-funded civic groups in the country—puts concrete action to rising Russian complaints, voiced most vehemently by Mr. Putin, that the U.S.’s own human-rights failings give it no credibility to lecture others.  But the adoption ban has exposed Mr. Putin to criticism both internationally and within his own government. Critics allege that the law makes political pawns out of Russian orphans, whose living conditions can be dire and prospects for adoption often slim.

Gregory White, Wall Street Journal 12/28/12

Many of the children adopted from Russia by American parents suffer disabilities such as spina bifida, which is treatable if medical resources are more abundant than in a Moscow orphanage.  Without adoption, these children will languish.  Worse yet is the fate of young especially pretty women, who outgrow the orphanage, and become prey on the streets of the city.  The sex slave and drug trade flourish in Russia; young girls are turned on and turned out.  Most grievous are the adoptions shut down in mid stride.  There are children and parents who have spent much time together and bonded; they will now be unable to complete the process, some just a week or so from flying home together.

“I looked the man in the eye. I found him to be very straightforward and trustworthy. We had a very good dialogue. I was able to get a sense of his soul; a man deeply committed to his country and the best interests of his country.”  President G.W. Bush about Vladimir Putin, press conference, 1/6/2001

“I told him (Yeltsin) I was impressed by what I had seen of President Putin but wasn’t sure he was as comfortable with or committed to democracy as Mr. Yeltsin.”  Former President Bill Clinton in a NY Times article, “Boris the Fighter” on the occasion of the funeral of Boris Yeltsin 4/29/2007

Vlad, the Impaler, Putin

Vlad, the Impaler, Putin

These protestations about violated human rights in the United States  coming from Vladimir Putin, a triumphant thug who came up through the ranks of the KGB, now FSB, would be ridiculous, if so many innocent lives were not sacrificed to the brutal, leveraged, “diplomacy” of the hard core left.  Remember in October of 2006, Anna Politkovskaya, a gifted, courageous journalist, was assassinated in the lobby of her apartment building with two bullets in her head.  She had become a potent nuisance to Putin with her brilliant expose of “Failed Democracy” and the outrages against Chechen civilians.  She was murdered on Putin’s birthday, no doubt a gift from his old colleagues in the FSB, who are exceedingly skilled in contract murders.  A month after her death, Alexander Litvenenko, a former FSB officer who had defected to the West, was taken very ill to a British hospital, where he died a gruesome, slow death three weeks later of acute radioactive polonium poisoning.  He had been working with MI5 and MI6 as well as in his new career as a journalist. He published two books:  “Blowing Up Russia, Terror from Within” and “Lubyanka Criminal Group.”   Polonium in the mashed potatoes is a creative and cruel method of political assassination, again one in which the old KGB was particularly gifted.  The “Cold War” may be in the history books, but its practitioners learned their craft well.

President Obama to then President Dmitri Medvedev (now Prime Minister after he and Putin again exchanged chairs): “This is my last election.  After my election, I have more flexibility.”  Video…

Medvedev:  “I understand.  I will transmit this information to Vladimir.” 

Ten years later and fully adapted to her adopted country, this beautiful daughter of our friends is doing splendidly at an exclusive private school.  Her grades are excellent, and she is excelling in her other special interests in photography and basketball. She is on the local “travelling team” as an All Star in her age bracket.  The school for gifted students is on a handsome campus as a “feeder” school for the Ivy League and other top line universities. Her school has won the state wide Academic Decathlon nineteen times out of the twenty nine it’s been held.  One expects her prospects are considerably more promising than those of a street urchin in Moscow.  Her parents are devoted to her success in life and to her nurture.  Love is irreplaceable.

“May it show us the family’s holy and enduring character and exemplifying its basic function in society: a community of love and sharing, beautiful for the problems it poses and the rewards it brings; in sum, the perfect setting for rearing children – and for this there is no substitute.”  Pope Paul VI, speaking of the Holy Family in Nazareth 1/12/1964

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The Taxman Cometh

Great Horned Owl taken 12-8 on Angela's garageThe calm of a waiting predator, watching.

Great Horned Owl taken 12-8 on Angela’s garage
The calm of a waiting predator, watching.

 

I am like a desert owl, like an owl among the ruins.

I lie awake; I have become like a bird alone on a roof.

Psalm 102: 6,7

“When you’re 50 you start thinking about things you haven’t thought about before.”  Eugene O’Neill

Still in our early twenties, we withheld some of our Federal income taxes for 1969, the year we lived in Boulder, to express our displeasure at the conduct of the war in Vietnam.  Woefully naïve on several counts, I wrote a note with our tax return clearing up in excruciating detail why we were doing so.  Martin Luther King and Bobby Kennedy were dead, and the world seemed bleak. Returning to Massachusetts with our infant daughter, we were living temporarily with my parents waiting for a cheap winter rental to open up on Mashnee Island off Cape Cod.

How they found us remains a mystery, but as I was coming home from work one evening driving my hand painted 1956, flathead six Chevy pickup truck, two tired looking gray men in rumpled suits pulled into my father’s driveway driving a dirty gray Ford Crown Vic.  Apparently, they had been waiting for me.  The younger of the two had a black band fedora; the older one had a close cropped fringe of salt and pepper hair with nothing on top.  I had a lot of hair and jeans stained from climbing trees.

The older one in charge, whose name has long receded, gave me his card and explained that they had no issue with our political views, which were our prerogative to hold, nor did they care to debate – very clear there would be no debate.  However, they had come to collect the taxes due plus penalties and interest.  It wasn’t a lot of money, but taxes were taxes after all and not an option.  He rattled off his bullet points unapologetically by rote without a smile or a threat or an alternative.  First they would attach and drain, if necessary, our checking and savings accounts.  If we had no such accounts, they would garnish my wages.  If I lacked a job, they would lien our house.  If we had no house, they would take our truck.  He looked over at the Chevy pointedly.  Which would I prefer?

 And so it goes.

Raushenberg's "Canyon"

Raushenberg’s “Canyon”

A story in this week’s WSJ reminded me of this incident for some reason.  Lifelong art dealer, Ileana Sonnabend, died in 2007 leaving her considerable collection to her heirs, Nina Sundell and Antonio Homem.  The heirs were forced to sell about $600 million dollars worth of their heritage to pay the $471 million in death taxes due on them.  ($600 million was more than was due, but of course, taxes were owed on the proceeds from selling them – capital gains taxes on the death taxes.)  Of course, there was a catch with one of the pieces: Robert Rauschenberg’s “Canyon”, created in 1959 and appraised at $15 million by the IRS.

The collage legally couldn’t be sold because it contained a stuffed bald eagle; selling it would violate the 1940 Bald and Golden Eagle Protection Act and the 1918 Migratory Bird Treaty.  That Rauschenberg before his death filed a notarized letter in 1988, stating that the eagle had been killed and stuffed by one of Teddy Roosevelt’s Rough Riders long before the 1940 law was in effect, made no difference.  The art work could not be sold; the auction house said it was worth nothing as a sale item.  The family filed an affidavit claiming that due to the inability to sell it, there was no value, and therefore no taxes were due on the inheritance for it.  Aha, responded the IRS, since there was a “gross understatement” of its value by the owners, the IRS value had now been upped to $65 million, so the tax bill was $29.2 million plus $11.7 million in penalties for understating its value.   Plus interest.

After five years of expensive legal wrangling, the painting, which had been on permanent loan for display by the owner at the Metropolitan Museum, was donated to the Museum of Modern Art, also in New York.  The painting had been exempt from Wildlife Service penalties as long as it was on loan to the museum, so now it passed with the same waiver to the MOMA.

And so it goes.

The hang up on avoiding the fiscal cliff is the tax rate on the top 3% of earners, not the tax dollars paid, but the tax rate.  While President Obama has proven to be a poor to middling CEO in his role at governance, he is a near genius at politicking, perhaps learned through political infighting during his bureaucratic years as a community organizer.  The tax rate increase he has drawn as a line in the sand has little to do with revenue – the dollars that would be collected are a little spot of yellow in a great snow drift.  The tax rate increase has everything to do with driving a wedge and causing as much consternation as possible amongst his political enemies.

Bear with just a few numbers.  In 1958, the top 3% of earners paid marginal rates as high as 91%, a progressive erotic dream, but almost no one paid those rates because of the pages of loopholes and deductions available.  The total income of the top earners was 14.7% of all income earned, and they paid 29.2% of all federal income taxes.  Many of the loopholes have been closed or capped already, and in 2010 the elite 3% earned 27.2% of all income; their percent of all taxes paid rose to 51%.  Middle and lower income earners (the bottom two thirds) earned 41.3% of all income and paid 29% of all taxes in 1958.  In 2010, their share of earned income had fallen to 22.5%, but their share of taxes paid plummeted to 6.7% of all taxes.

So, indeed, the rich have gotten richer, and their relative tax burden reflects that proportionately, but almost 50% of the rest of us pay no federal income taxes whatsoever.   The compulsion of the progressive liberal is not about “fairness”, it is about redistribution, punitive measures against the successful and ideology.  But even more so, it is about casting chaos into the opposition and twisting the knife.

And so it goes.

“They’re trying to kill me,” Yossarian told him calmly

“No one’s trying to kill you,” Clevinger cried.

“Then why are they shooting at me?” Yossarian asked.

“They’re shooting at everyone,” Clevinger answered.  “They’re trying to kill everyone.”

“And what difference does that make?”

 

“That’s some catch, that catch-22,” he observed.

“It’s the best there is,” Doc Daneeka agreed.

Catch 22, Joseph Heller

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Sing, But Keep Going

winston-churchillA story is told about Winston Churchill that may or may not be apocryphal, however the significance for us is timeless.  After the war was over and Sir Winston unceremoniously voted out when his indomitable gift of leadership and candor became politically inconvenient, he was invited to speak at a gathering at Cambridge University.  He sat through the formal dinner with his bulldog visage unreadable, silently contemplating the tribute that dominated one wall, memorializing the long list of Cambridge alumni and students who laid down their lives to protect their country from being brutally incorporated into the Third Reich.  The dean finally concluded his endless extravagant introduction lauding Churchill, and how his soaring rhetoric saved the British Isles.  An expectant hush settled on the listeners, awaiting inspirational brilliance.  Sir Winston stood wearily and looked out over hundreds of fresh young faces, survivors whose brethren would never return.  Glancing once again over to the wall, he spoke, “Never give up, never give up, never give up.”  Churchill settled back into his chair.

The usually laconic, if not truly morose, Senate Minority Leader, Mitch McConnell, burst out laughing when Treasury Secretary Timothy Geithner proffered the Obama administration’s “compromise” solution to avoid jumping over the “fiscal cliff” on January first.  Without a scrap of compromise or one inkling to slow down spending, its raison d’etre was taxes, taxes and then, again, more taxes, and even those barely cover a couple of weeks of Federal expenditure. Not a serious proposal, only more political posturing and dialectic of class struggle. To add to the comic relief, the proposal suggested that Congress should abdicate its responsibility to approve debt ceiling increases.  “Leave it to us and avoid the unseemly bickering,” suggested the Executive Branch.  Perhaps that is the rub that incited McConnell’s rarely seen mirth.

The administration kicked off the reign of the 44th president with an unprecedented level of unstimulating stimulus spending at the staggering level of $800 billion larded on in 2009.  The unprecedented soon became business as usual with spending levels sticking at the newly established benchmark, resulting in undreamed of deficits, over $1,000,000,000,000 (one trillion) a year.  This deficit and the negotiations to raise the debt ceiling resulted in the beggar’s choice deal that dug the chasm looming ahead and deemed by a gleeful media as a “fiscal cliff”.  $16 trillion in debt (and counting), and the compromise solution only addressed asking more from the taxpayers with the rhetoric about fairness and redistribution.  Not a syllable about specific proposals to curtail diarrhea profligacy.

One provision, raising the estate taxes on the “wealthy” from 35% to 55%, would result in the breakup of long held family ranches and farms.  Ranches and farms are by definition illiquid, with their “wealth” consisting of hundreds or even thousands of acres of agricultural land – land owned for generations.  Every nickel of the income derived from these businesses and the income of their owners has already been taxed, every acre taxed each year with property taxes.  Yet when the principle owner lacks the good sense to stay alive, the heirs are subject to the “death tax”.  Their only option is either taking on insupportable debt or selling off some land to pay the taxman.  Estate taxes are deeply rooted in progressive egalitarianism and antipathy to any attempt to pass along the hard earned net worth of the successful to their heirs.  Not just the oft cited Paris Hilton or Kim Kardashian excesses, but privately held farms, ranches and businesses are to be crushed with burdensome taxes at the passing of the owner.

Perhaps the least understood and therefore mostly avoided debt discussion is not the fiscal deficit that shows on the Federal balance sheet.  The debt that is held “off the books” is far worse.  Like Enron, which sealed its own ruin by concocting sophisticated accounting to hide liabilities, the Federal debt that isn’t declared on the balance sheet is shocking to comprehend.  Think icebergs.

The promises made to those who have paid into the system their whole working lives are not stipulated in Federal deficit reports.  The mostly unfunded liabilities of Social Security, Medicare and federal employees’ future retirement benefits already are over $86.8 trillion, 550% of Gross DP.  Much has been made of our stated deficit of $16 trillion crossing the line of 100% of GDP. Quick addition of both the stated and unstated deficits is $102 trillion or about $310,000 for every man, woman, child and transgendered person in the country.  You only thought you had worked all your life to pay off your mortgage and credit cards.  Think again.

Secretary Geithner stated unequivocally that Social Security is not on the table in any debt discussion under any circumstances.  Why?  My cousin, David, is an unrepentant Connecticut/Manhattan progressive, yet somehow remains very intelligent and a good guy.  I have full confidence that he and I could sit down with a halfway competent accountant and come to an agreement to fix Social Security funding for the foreseeable future over a couple of beers.  Eliminate the cap (satisfies taxing the rich), stop the ridiculous pandering of cutting the Social Security contributions of all of us employees, gradually continue to raise the retirement age to reflect the increased longevity of our citizens, and we’re just about done.  How about another beer?  Why can’t our elected officials do the same?

 Nearly 49% of the voting population chose Door “B” to common sense and responsibility.  We lost, but cannot surrender.  Never give up, never give up, and never give up.  For the sustainability of this noble Great Experiment of ours.  To remain true to our ideals and consciences.  For our children and grandchildren.  Sing, but keep going.

“Let us sing alleluia here on earth, while we still live in anxiety….So, then, brothers (and sisters), let us sing now, not in order to enjoy a life of leisure, but in order to lighten our labors.  You should sing as wayfarers do – sing but continue your journey… Sing, but keep going.”  St. Augustine

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Stalemate

A chess match ends as a win, a loss or a draw.  A draw can be agreed to by the persons playing the white and black pieces.  Certain situations are deemed a stalemate, which is a draw by definition.  No one wins.  The rules defining a stalemate have application to real life.  If one player on either side is not in checkmate, but has no legal moves, the game is a stalemate and drawn.  If both players have moved fifty times without a pawn moving or a capture being made, that’s a stalemate.  If a position has been repeated three times with every piece on the exact same square for both sides, that’s a stalemate and drawn.  It matters not if the positions are repeated sequentially, so long as they are reproduced exactly.   Only the side in the weaker position poised for a loss would declare the repeated position and draw.

“If a tie is like kissing your sister, losing is like kissing your grandmother with her teeth out.”  George Brett

At the end of drawn out, bitterly contested campaigns, we find ourselves shell-shocked weary with virtually no change in the balance of power in Washington.  Hundreds of thousands of words have been and will be written about changing demographics, debate performances, issues false and true, ground games and early media blitz bets placed in swing states.  The essential question, however, is where do we go from here?  Can the Republicans tweak their base and make inroads into the new demographic coalitions of Latinos, single women, citizens of Asian origin and other minorities?  Have we reached a “tipping point” such that those relying on government and “in the wagon” outnumber those contributing to tax revenues and “pulling the wagon”?

“When the people find they can vote themselves money–that will herald the end of the republic.”  Ben Franklin

Can we avoid repeating our exact position or making fifty moves with no progress to break the potential of stalemate?  Will common sense prevail over ideology and a compromise be crafted to avoid the “fiscal cliff” of large across the board tax increases and devastating cuts to our defense that the Congressional Budget Office tells us will script us directly into over 9% unemployment and a new recession?  Other than a textbook definition, did we ever truly climb out of the last one with the prolonged anemic “recovery”?  Will the now assured full implementation of Obamacare with its assured tax increases and enormous expenditures make cutting our deficit structurally impossible over the next decade and trip us into a recession anyway?  What the hell was David Petraeus thinking?  So many questions to answer, we can be easily overwhelmed.

“A billion here, a billion there, and pretty soon you’re talking about real money.”  Attributed, but not fully documented, to the late former minority leader, Senator Everett Dirksen

There is some certainty in the real numbers, however, and they are worth understanding as we discuss everything else.  Let them speak for themselves.  The deficit that deeply troubles so many of us and will beggar the future of our children can be grasped quite easily with a minimum of sophisticated fiscal knowledge by using this table from a Wall Street Journal article:

U.S. Deficit Growth (from US Treasury Dept and CBO records)
Total federal revenue, outlays and deficits,
fiscal years 2007-2012, in billions of dollars.
Year           2007        2008        2009        2010        2011        2012
Revenue  $        2,568  $    2,524  $    2,105  $    2,163  $    2,302  $    2,449
Spending  $        2,729  $    2,983  $    3,518  $    3,456  $    3,599  $    3,538
Deficit          ($161)       ($459)    ($1,413)   ($1,293)    ($1,297)    ($1,089)
% of GDP           -1.2%        -3.2%      -10.1%      -9.0%       -8.7%        -7.0%

Let these numbers roll around the back of your head for just a little while.  As revenues dropped (and are now just starting to recover), spending exploded and set a new benchmark frozen at an unprecedented level. No serious attempt has been made to curtail the profligacy of Washington as they buy our votes and the campaign contributions of special interests. Our deficit in the Obama years as a percent of Gross Domestic Product (the sum of our total economic activity as a nation) has never been less than double the worst year of the Bush administration, which was fighting the same two wars.  And the actual dollars of deficit have never been less than double the worst of the Bush years.

The Republican caucus insists on paring back the out of control spending; President Obama’s supporters such as those in the public unions and MoveOn.org insist on reducing the deficit by raising taxes.  His proposal in last year’s debt ceiling negotiations was to raise them by about $82 billion a year, which is still only 7% of last year’s deficit.  This week he has upped the ante to double that with no mention of trying to reduce spending.  Stalemate.  Many believe he would be content to let the economy go over the fiscal cliff and blame the Republicans for the new recession while satisfying his left base which demands higher tax rates and very few cuts.  Next year he could negotiate from the now higher rates.  Stalemate, and playing political brinksmanship with our fragile economy.

Unsustainable is a clichéd buzz word, but sometimes clichés are the best we can do.

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The Scribes and The Pharisees

Just behind sex, food, shelter and clothing in the hierarchy of human drives is the pharisaical impulse – that most ardent desire to write down and impose the minutiae of stultifying rules and regulations upon the spirits of our fellows.  Jesus put it this way: They tie up heavy loads and put them on men’s shoulders, but they themselves are not willing to lift a finger to move them.” (Matt 23:4) John the Baptist was more succinct: “You brood of vipers!” (Luke 3:7)

We have advanced exponentially in the technological competence to distribute and enforce these regulations, but not a whit, it seems, in controlling the inclination.  In the twentieth and twenty first centuries, the prime movers of regulation are the progressives or liberal political parties (or tyrannies), most especially exemplified currently in the United States by the Obama administration.

Just a couple of examples from the most prolific regulations generators in American history:

  • In 2010, the administration headed the charge to fulfill Rahm Emanuel’s admonition (former White House chief of staff, now Mayor of Chicago) to never let a serious crisis go to waste by signing into law the Dodd Frank financial reform bill.  When any bill is passed, it then falls to the bureaucrats to promulgate the regulations defining how it will be enforced.  And propagate the new bureaucrats necessary to enforce it.  Propagating bureaucrats is something at which progressive government is particularly talented.  Consisting of 2,319 pages, Dodd Frank has generated over 8,000 pages of new Federal Register regulations.  And counting.
  • The Affordable Care Act (Obamacare) was worse yet, imposing over twenty new taxes, over 2,700 pages in length, it has generated to date almost 12,000 pages of new regulations.   Eighteen pages of these went just to define the term, “full time employee”.  No kidding.  Any reasonable person could have defined the term in a well constructed sentence.  11, 327 pages in July so far.  And counting.

The far from conservative and long esteemed magazine, “The Economist” wrote this about Dodd Frank: “(the bill) will smother financial institutions in so much red tape that innovation is stifled and America’s economy suffers.”  Given the tepid recovery, barely above horizontal since the recession ended in early 2009 – the slowest post war recession recovery –and the record breaking low velocity of money turn over, “The Economist” was prescient, albeit with an obvious prediction.  Banks are sitting on enormous reserves of cash that are not being put to use.

 Financial institutions are struggling to understand and implement the 8,000 pages of Dodd Frank, and are increasingly timid to put their cash back into growing the economy.  Businesses, also concerned with compliance and future tax implications, are reluctant to borrow the money necessary to grow and hire new employees.  Fear and the fearful levels of work necessary to comply are two sea anchors that an economy just beginning to see the wind pick up from the doldrums doesn’t need.  Experts approximate that the 8,000 pages so far are about 30% of what will ultimately be imposed.    The House Committee on Financial Services calculates that the law will take private companies 24 million labor hours a year and require that businesses hire 26,477 employees to comply.  In that sense, it is, I suppose, a jobs bill.  Of course, not one of those 26,477 expensive employees will contribute an iota to growing the business or the profits necessary to hire more people.  Au contraire.

What does this new bureaucracy look like, and how much does it cost the already overburdened taxpayer?  One section (there’s a lot of sections in 2,300 pages) of Dodd Frank was the original brainchild of Elizabeth Warren (Harvard professor and Senate candidate running against Scott Brown in Massachusetts). Dodd Frank established a new Consumer Financial Protection Bureau (bureau being first two syllables of ‘bureaucrat’).  Sounds lofty and helpful, doesn’t it?  The CFPB has a budget of over $447 million for fiscal year 2013, ladles on 958 new federal employees, 60 % of whom make over $100,000 in salary, and has authority to draw up to $550 million directly from the Federal Reserve with no Congressional oversight and just a one page letter to the Fed describing why it needs the money.  Five percent of the employees make over $200,000, which is more than a sitting cabinet member.  The “administrative assistant” (secretary) of the director, Richard Corday, makes $165,139. They spent $40 million (40% of it borrowed in the deficit) on office renovations.

In contrast to those exalted salaries, the median American taxpayer makes $50,054, an amount that has decreased against inflation every year of the Obama administration, including 4% last year.  So far, we have seen the CFPB produce such gems as Consumer Alerts (such as the mandatory small print in things like credit card terms and conditions) published in 187 languages at taxpayer expense, including Somali and Tamil – spoken predominantly in northeast Sri Lanka.  How many of us have read the terms and conditions in the existing credit card statements?  The Tower of Babel had nothing on the Consumer Financial Protection Bureau.

The Labour Party government in post WWII Great Britain left in place many of the wartime restrictions and regulations; this is typical of the progressive Pharisee: once in place, regulations tend to grow brothers and not ride off into the sunset.  A report was commissioned in the fifties to investigate the benefits of closely managing the youth.  Here are some excerpts: Special agencies, called Citizen’s Advice Bureaus, are set up to steer the bewildered through the forest of rules, and to indicate to the persistent the rare clearings where a private person may still make a choice…(the ordinary citizen) spends great stretches of his waking hours going through motions that have been predetermined for him by directives in whose framing he has had no part, whose precise intention he seldom understands, and of whose appropriateness he cannot judge.  (They are) so acclimatized to that state that they seldom plan and carry out under their own steam any new….enterprise.  He thus looks forward to no future period at which a sinewy faculty of responsibility is likely to be of service to himself or others.

Anyone who has had the misfortune to work for a micromanager experienced the slow sapping of creativity, energy, commitment and joy that results.

At his inauguration, President Obama promised “hope and change” and to “fundamentally change” America.  Many did not understand the degree to which he wanted to change us, nor exactly how he would go about it.  This time during the election process, we do.

(Powerful central government) covers the surface of society with a network of small, complicated rules, minute and uniform, through which the most original minds and the most energetic characters cannot penetrate to rise above the crowd.  The will of man is not shattered but softened, bent and guided… Such a power does not destroy, but it prevents existence; it does not tyrannize, but it compresses, enervates, extinguishes, and stupefies a people, till each nation is reduced to be nothing better than a flock of timid and industrial animals, of which government is the shepherd. “Democracy in America” Alexis de Tocqueville.

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