A Closer Look

Frost At His Frostiest

2010-04-19T11:46:00.000-07:00

The wise people who appoint themselves the guardians of the American soul have been telling us since the publication of Walden by Thoreau over 150 years ago, that materialism and mass production have doomed us. Like Thoreau they bring us the antidote of the spiritual Asian--Thoreau's Hindu meditator or today's idealized Tibetan Buddhists. Not to mention that the publishing industry often mass produces books called the Zen of this or the Zen of that.

Our most prominent American poet, Robert Frost dealt deftly and devilishly with the idea of Asian spiritual exceptionalism and American sin in an almost unknown poem from a 1947 collection. Some people have trouble grasping it, though it seems simple. First the poem, then my notes in case Frost is not clear.

An Importer

Mrs. Someone’s been to Asia,
What she brought back would amaze ye.
Bamboos, ivories, jades, and lacquers,
Devil-scaring firecrackers,
Recipes for tea with butter,
Sacred rigmaroles to mutter,
Subterfuge for saving faces,
A developed taste in vases,
Arguments too stale to mention
‘Gainst American intervention;
Most of all the mass production
Destined to prove our destruction.
What are telephones, skyscrapers,
Safety razors, Sunday papers,
But the silliest evasion
Of the truths we owe an Asian?
But the best of her exhibit
Was a prayer machine from Tibet
That by brook power in the garden
Kept repeating Pardon, pardon;
And as picturesque machinery
Beat a sundial in the scenery –
The most primitive of engines
Mass producing with a vengeance.
Teach those Asians mass production?
Teach your grandmother egg suction.

---------------------

If that was clear, read no farther because my notes are unnecessary prose.

The poem is easy enough to understand if you summarize the story:

--Back from Asia comes Mrs. Someone (not important enough to name, and like many unimportant thinkers)

--She has lots of "art" and a new criticism of America

--America, she says, has lost its soul to mass production while Asians express their souls in artful and personal handwork.

--Our spectacular displays of technology, from gadgets to skyscrapers are our way of avoiding the spiritual truths of Asia (sound somewhat like all the aficionados of Tibetan culture?)

--America has doomed its soul with such impersonal and material stuff

--to show Asian spirituality she has brought home a prayer wheel powered by the flow in her brook

--it uses a primitive engine to mass produce what--prayers!

--we have nothing to teach the Asians about mass production; they are ahead of us, having extended mechanical mass production to spirtual matters

Frost foresaw the Asian ability long before the Asians really got started in mass production for Nike and Walmart.

One might also note that while the decadent Americans were creating national parks and forests and preserving farmland, the more spiritual Asians of the Mongolian steppe and Tibetan highlands had devastated their environment by overgrazing and a classic demonstration of the 'tragedy of the commons'.

Justice Department Wants Mentally Retarded Lawyers--Really

2010-02-11T10:22:00.000-08:00

Our government at work.

Under Eric Holder no holds barred in hiring for the Justice Department.

“The U.S. Department of Justice, Civil Rights Division is seeking up to 10 experienced attorneys for the position of Trial Attorney in the Voting Section in Washington, D.C.”

“The Civil Rights Division encourages qualified applicants with targeted disabilities to apply. Targeted disabilities are deafness, blindness, missing extremities, partial or complete paralysis, convulsive disorder, mental retardation, mental illness, severe distortion of limbs and/or spine.”

For those who doubt that this is our government, see:

http://www.justice.gov/oarm/jobs/attorneyvotingoarm2010.htm

No word yet whether those outraged Democrats described as ‘retarded’ by Presidential assistant Rahm Emmanuel are appeased by this ad for their services.

The Political Lynching of Harry Reid

2010-01-12T19:00:00.000-08:00

When Barack Obama was neck-in-neck with Hillary Clinton racing for the Democratic nomination for president, one of his earliest supporters, Senator Harry Reid of Nevada said in a private conversation that Obama could win the presidency. One of his reasons was that Obama was “light skinned” and "with no Negro dialect unless he wanted to have one."

Political thunder rolled and lightning flashed as posses of liberals and conservatives threw their nooses around Reid's neck. Reid issued a quick and humble apology to the President. Democrats pardoned him. Republicans charged bigotry and double standard. Reid continued to grovel in public regret. Seldom have we been treated to such bipartisan demagoguery. Reid did nothing wrong. He was within his rights and he was right.

Pause to ask just where in his remarks he sinned.

Reid had the facts right: Obama, whose mother was white and father black, is light skinned. Second, he does not speak with any accent identified with black Americans. Can Obama use African American accents? Sure he can, and like all of us, he sometimes changes his vocabulary or pronunciation to fit in with friends or ‘the crowd’.

That leaves us to ask if Reid’s offense was implying that these qualities of Obama made him more acceptable than someone dark colored like Dr. Thomas Sowell the economist, Condaleeza Rice, or Smokin’ Joe Frazier the boxer. That suggestion could offend by suggesting t

hat Obama would receive votes because of accent and skin color, not by earning those votes. But don’t American blacks themselves talk about the advantage some have by being lighter skinned? Perhaps Reid offended black Americans who are darker and speak with pronunciation common if you listen to the Jeffersons or Sticky Fingaz or Magic Johnson or Al Sharpton.

Many claim the worst offense was the use of the word “Negro.” But it’s a word used by many black Americ

ans. It’s the customary word to describe the accent that Obama doesn’t have. Anybody he

ar of the United Negro College Fund? The only poor choice in

the phrase was dialect instead of accent, and that’s an ignorance of linguistics, not bigotry.

Or perhaps Reid offended the American public in general—implying that skin color and accent play a role in the public’s judgment of a candidate. They do, of course. Are we not allowed to say so? Aren’t we constantly told that racism is still alive in America?

Does anyone doubt that a significant number of votes are influenced by how a candidate talks and by skin color? Even Vice President Joe Biden opined that Barack Obama would win votes because he was “the first mainstream African-American who is articulate and bright and clean and a nice-looking guy."

But Reid didn’t apologize to all voters, or black Americans. He apologized to President Obama. Yet certainly the President, who had no record of big accomplishments in or out of politics, won a lot of votes by being articulate, easy to understand, and by not fitting the unfortunate stereotypes of black Americans. He also won a lot of votes because as Joe Biden suggested, many Americans (and most blacks) wanted a black president and he fit their comfort zone in most ways.

What we should lament most loudly is that when Harry Reid speaks a clear truth he has been pilloried by everyone, and that Republicans, acting like politically correct liberals, make Reid’s truth a bigger shame than his lies.

And even more important, when speaking the truth in a private conversation becomes a matter for public shaming and persecution, America is in deep doo doo. The Democrat pardon reinforces their role as self-appointed censors. If Republicans want to shame Reid, they should first support him for speaking the truth, then point out how he has turned the exercise of a fundamental right into the occasion for a groveling apology.

(Photo credit, noose copyright by Matthew Lee High: www.flickr.com/photos/ )matthigh/2772052540/

When A Lot Of Knowledge Is A Dangerous Thing

2010-01-02T23:26:00.000-08:00

Periodically we need to field test durable but competing visions of how the world works.

New Years Eve I saw the very learned and witty novelist Gore Vidal express the conventional wisdom that we need intelligent people as political leaders. By intelligent he meant “intellectual” as in people from Harvard and Yale, people who can quote from the classics and great books. He welcomed Obama as the only president in modern times who qualified as truly intelligent, although he cited no evidence. Vidal is a very learned and graceful writer whose books are worth reading, but who speaks in public as if his credentials absolve him from field testing the truth of his judgments on others. Suffice that they are sharp and witty.

His greatest intellectual rival had a different vision of intellect and government. He famously said, ““I’d rather be governed by the first 200 names in the Boston phone book than by the faculty of Harvard.” The author of that declaration was William Buckley—novelist, host of the TV debate Firing Line, and editor of National Review.
For our field test, however, let us avoid the controversial evaluation of presidents and members of Congress and look at the case of a mathematician turned investor and political activist.

Readers may have heard of the recent move by Senator Diane Feinstein of California to prevent the siting of a solar electric project on federal lands in the Mojave Desert. Her move provoked a fight with alternative energy champ and fellow liberal Democrat Robert Kennedy, JR. who said, “This is arguably the best solar land in the world, and Senator Feinstein shouldn’t be allowed to take this land off the table without a proper and scientific environmental review.”

This interesting dispute led me to look behind the scenes at the real estate and environmental dimensions of the land use dispute, and there I found our mathematician-investor-activist and a test of the Vidal-Buckley dispute. David Gelbaum studied math under a professor who devised a system that beat the Las Vegas blackjack dealers. Gelbaum went on to develop a mathematical model for predicting stock values. Managing his fund Quercus Trust he became a billionaire. Like other billionaires he became a political activist, pouring his money into the Sierra Club’s political efforts, Democratic campaigns, and the National Democratic Party, and over $30,000 directly to the Obama campaign.

He also joined these people in their often proclaimed belief that alternative energy and green technology are good for the economy and good for investors. He co-founded Wildlands Conservancy then bankrolled its purchase of Mojave lands for a natural preserve. The Conservancy made a sweetheart deal with Catellus Development to buy the land Catellus could not develop and set up Catellus for a tax deduction for presumably selling the land at less than market value.

Often such deals involve real below-market pricing by sellers, but very often conservation group and landowner collaborate to get an appraisal fraudulently far above the actual purchase price, and the seller deducts the “gift” from taxes as well as divests itself of unwanted or unusable land. Why should Catellus fight about desert rats and tortoises when it could exchange the land for a tax deduction?

Whether or not the Mojave-Catellus-Wildlands deal involved land price manipulation, Gelbaum has often been accused of stock manipulation and has barely escaped indictment. Consider him innocent until proven otherwise. Nevertheless, having made billions for himself and his causes, he lost billions for people who invested in the companies his Quercus Trust bought into with the announced intention of “helping” them out of difficulty.

That outraged legions of small and often idealistic investors. Then last year Gelbaum’s investments in “green companies” ended up gutting the budgets of his favorite causes—the Sierra Club to which he had secretly given $47 million and the ACLU to which he had contributed secretly a fourth of its budget, some $94 million. In December he tried to assure members and other donors that his withdrawal in no way signified disapproval of the organizations.

Why had he cut off the funds? “My investments in alternative, clean energy companies have placed me in a highly illiquid position as a result of the general credit crisis in the American and world financial systems."

No one can fault Mr. Gelbaum for having put his money where his mouth and his heart are, but the results are instructive. By abandoning his wildly successful logic and economic math, he has achieved the following:

A. Put two very large non-profits in the position of having too many eggs in one basket (a novice business mistake), then devastated the budgets of those charities by bad investing

B. Made a highly public case that green tech is not a good investment and job creator. That undermines a major policy claim of the Obama administration he supports.

C. By helping put millions of acres of California land off limits to solar energy, he may have destroyed the state’s ability to achieve its legislated goal of generating 33% of its energy from renewable sources by 2020.

This highly intelligent math genius and successful investor ended up making a cascade of stupid investment decisions and inflicting grave damage on his own favored causes. He began to making mistakes when his political goals started to command his intelligence, twist his logic, and veto his mathematics.

A committee of the first 200 names in the Boston phone book would not have made such a mistake. (Reminds me that the faculty of Harvard passively approved the policy our President’s chief economic adviser, Larry Summers, while president of Harvard. He set up its budget for a $1.8 billion loss, partly by investing in the complex debt instruments the Obama administration has blamed for much of the nation’s economic crisis.)

Moral of the story: alternative energy is the wave of the future just as oil and coal once saved the world from deforestation for fuel and for pastures to feed that engine of transportation and work—the horse. Our new transition, like our old transition, is inevitable, but relying on our intellectuals in government to choose how and when and through what companies or government dictates we should invest may be intellectual, but it is not intelligent.

So what is the equivalent of the first 200 names in the Boston phone book? The millions of average men and women who collectively are called “the market.”

OBAMA BY HIS NUMBERS AND VISION

2009-12-27T16:00:00.000-08:00

When a friend ended her holiday greeting with "and a prosperous new year--I hope," I was about to respond with an economic opinion. Opinions, however, abound so I thought the President and his numbers can speak for themselves. Here they are:

"I won't stand here and pretend that any of this will be easy - especially now. The cost of this economic crisis, and the cost of the war in Iraq, means that Washington will have to tighten its belt and put off spending on things we can afford to do without. . . . Barack Obama in Canton, Ohio, October 2008.

“As President, I will go through the federal budget, line-by-line, ending programs that we don’t need and making the ones we do need work better and cost less.” Nov. 2, 2008, election eve.

Presidential achievements and positions since taking office:

-- $787 billion stimulus

--$33 billion expansion of the child health program known as S-chip

--$410 billion omnibus appropriations spending bill

--$80 billion auto company bailout.

--$821 billion cap-and-trade bill through the House

--$1 trillion health-care bill.

--$400 billion Christmas eve package of emergency aid to failed government housing corporations. Fannie and Freddie will be on taxpayer support for at least 3 more years.

President Obama: “. . . it does offend our values when executives of big financial firms-firms that are struggling-pay themselves huge bonuses, even as they continue to rely on taxpayer assistance to stay afloat."

--$42 million in bonuses for top 12 executives of failed govt. housing corporations Fannie and Freddie

--budget plan for the next decade projected that revenues about 18% of GDP; spending up at 24% of GDP

--Annual deficits of about 6% of GDP for foreseeable future

In Jan. 2009 deficit for the year $422 billion.

Nov. 1, 2009, deficit for the year $1.42 trillion

Jan 2009, national debt $6.3 trillion

Nov. 1, 2009 national debt $7.5 trillion

Have a happy and prosperous new year.

Obama On Scientific Integrity

2009-12-03T16:07:00.000-08:00

What was President Obama’s response to the revelation that many climate scientists whose reports shape world climate policy have been cooking their information, trying to suppress contrary opinion and data and embracing censorship of critics?

Read the President’s words:

MEMORANDUM FOR THE HEADS OF EXECUTIVE DEPARTMENTS AND AGENCIES

SUBJECT: Scientific Integrity

Science and the scientific process must inform and guide decisions of my Administration on a wide range of issues, including improvement of public health, protection of the environment, increased efficiency in the use of energy and other resources, mitigation of the threat of climate change, and protection of national security.

The public must be able to trust the science and scientific process informing public policy decisions. Political officials should not suppress or alter scientific or technological findings and conclusions. If scientific and technological information is developed and used by the Federal Government, it should ordinarily be made available to the public.

Sorry, that was what he said on March 9, 2009. He hasn’t said anything yet about the data and scientists who will have the biggest influence on talks in Denmark that could reshape climate policy and cost the economies of developed countries hundreds of billions of dollars.

To understand how an open minded scientist looks at evidence, please watch this video on the nature of climate change and some of the forces (including human) that act on it.

http://seekingalpha.com/article/175641-climategate-revolt-of-the-physicists?source=email

(Yes, this is on an investing site. Forget the surrounding text. Watch the video.)

(For the record, as the co-author of a book on America's beaches and as a science writer, I understand that we have lots of field data that result from warmer temperatures. Tundra, polar ice coverage, widespread glacial shrinkage, etc. These are the results of past warming. The direction, rate, and scale of future climate change and its causes is open to debate. Past events are not proof that humans are the critical element in climate change. And if we are the critical element, no one yet has proposed any measure that will significantly reduce projected temperature changes in the next 100 years or beyond.

As one of the scientists promoting global warming as a fact said in his e mail about variations on a time frame greater than 100 years, "We know with certainty that we know f***-all."

Given the other urgent needs of humankind and the natural environment, should any committed environmentalist be signing onto Kyoto, Copenhagen, and such schemes or cap and trade without proof that the results are worth the enormous costs?)

PRES. OBAMA'S USED CAR DEAL

2009-08-03T17:53:00.000-07:00

I once mediated a dispute in which the owner of a wrecked old car happily pocketed $4,400 from an insurance company for a car he had futilely advertised to sell for $3,500. Silly insurance company. Not to be outdone, President Obama is demanding Congress accelerate a program that has already been paying about $20,000 for old cars that have a value of as little as $1,000.

Congress says the program has invested our money to pay “only” $4,500 per car in order to do two things:

1. stimulate new car buying (thus saving jobs and auto companies)

2. Take the most polluting cars off the road

For a moment let us set aside the ethics of a business owner forcing taxpayers to cough up a few billion to boost its sales. Let’s do the math that shows Congress and the President underestimate the cost by 450%. All the while they are declaring the program a wild success because it spent the first billion in a week instead of their estimated year, and they are pushing through several billion more in spending.

The car buying web site Edmunds.com estimates that every three months of this year Americans would normally trade in some 200,000 older cars without being paid to do it. Since the government will pay $3,500 to $4,500 per old car let’s say the average is $4,000.

So government is forced taxpayers to give $4,000 x 200,000, or $800 million to a few people who didn’t need it in the first place. The remaining $200 million paid for some 50,000 cars. In other words the only real result of $1 billion was removing an extra 50,000 cars. Cost? $20,000 per car.

But wait, it’s even more. Since Americans trade in some 200,000 cars every 3 months, many of the 50,000 cars would be traded in later this year without a subsidy. So the entire $1 billion was unnecessary if Congress could have waited 6 months.

Thus: $1 billion really bought us cars we never had to buy at all. It makes the infamous $5,000 hammer bought by the Defense Department seem like a deal. All the first billion did and all the next billions will do is speed up the trade ins by a few months.

But wait, aren’t there benefits like boosting new car sales and cleaning up the air? Yes. The new car sales, too, would have happened. Cars, like people, don’t run forever and in the recession many people postponed trading in old cars, creating a growing backlog and thus soon-to-be unleashed demand for new cars. Without government “help”.

The car company President Obama and Congress bought, however, is in bad need of money now. So they decided that after giving the company a few tens of billions of your money to keep it out of the hands of private buyers and to save union jobs, you wouldn’t miss another few billion.

Wasn’t this the President who said he would cut the budget by getting rid of programs that didn’t pay their own way? Now he is not only creating them, but hailing them as a success and demanding Congress act fast and give us more of that success.

As my own Congressman, Peter DeFazio says on his web site, “I am aware of the abuses to the earmark process and have serious concerns about some of the wasteful spending in Washington.” Just some of the wasteful spending?

Only politicians could conceive of good investing as spending billions of someone else's money on something that would happen anyway and declare the loss a success. No, wait, what was the name of that guy that kept losing other people's money and calling it success--Bernie Madoff?

MY UNCLE BUSTER AND HEALTH CARE

2009-07-18T00:39:00.000-07:00

What would my Uncle Buster say about turning over health care to the federal government? He was no Joe the Plumber. In fact, in 1918 he was a 17 year old high school drop out who had run away from home and found work as a “pearl diver” in Providence, Rhode Island. That job title means dishwasher. The next year when returning WWI vets used their preference to take away his job, he applied to be an orderly in Butler Hospital for the insane. They needed nurses desperately, so they trained him and he was a nurse for the next 60 years.

In an unpublished memoir he expresses great admiration for the humane way Butler treated its inmates. That included giving capable inmates in-town paroles and others on-the-grounds parole, and providing others with work in the gardens and dining halls.

When my Uncle Buster died in his 80s he left a few thousand dollars to his beloved hometown of Plainfield, New Hampshire, but specified that the town could not use a dime of it for 100 years. He understood that government seldom puts aside money today to pay for tomorrow’s bills. So I think of him when I consider the present proposals for reforming American health care.

What would he think if he heard how much money we would have to put on deposit in an interest bearing account today, if we wanted to pay for Medicare benefits due over the next 75 years?

The answer, say the trustees of the Medicare system: $38 trillion.

That amounts to $103,000 for each man, woman, and child in America today. (Multiply that by the number of people in your family to see how much you would have to pay.)

That is our obligation today without adding any of the new Medicare benefits or any new costs of federal health insurance.

Consider now that the non-partisan Congressional Budget Office says that the present proposals before Congress to “reform” health care would increase the costs of health care to the taxpayer by hundreds of billions.

For instance, to subsidize insurance for the uninsured would cost $33 billion in 2013. That is almost $1,000 per American citizen, including babies. When today’s newborn are 10 years old, their cost (along with the cost to each parent and sibling) would be $4,300.

None of this counts on providing for the mental health care costs of the people who have proposed saddling their fellow citizens with such costs. My Uncle Buster, for all his modern views on the mentally ill, would never have proposed letting the inmates run the asylum.

Will President Obama Ban Inconvenient Dissent?

2009-07-08T12:31:00.000-07:00

I agree with the reader who said my blogs often focus on the negative. I love upbeat stories and my eyes tear up at underdogs triumphing by perseverance and talent. So I am not happy about writing a second blog in several days that reflects badly on President Obama. I often like what he says. I loved it when Obama came into office as the man who wanted to hear all sides of an issue, who had an open mind, who welcomed informed debate. But I come from a solid lower class blue collar family where we were always suspicious of people talking a good line.

And as for being negative too often, let’s remember that the President himself has spent his first five months in office blaming Bush and Republicans for most of his problems. In particular, he was leading the chorus of those who accused the Bush administration of silencing debate, punishing dissenters, and distorting science. I spend a good part of my life as a science writer, so let’s see how President Obama’s actions match his words.

While we admit that politics is not science (despite the thousands of “political science” departments in our colleges) let us propose a hypothesis and test it against our observed facts. Our hypothesis is that the Obama administration distorts scientific opinion and suppresses dissenters. Now the facts.

When a government agency like Environmental Protection Agency (EPA) presents research to support a new government policy, the law requires it to make public the records leading up to its findings. Courts have ruled "the evidence relied upon and the evidence discarded."

President Obama and several in his administration criticized the Bush administration for ignoring inconvenient opinions and distorting the scientific record.

President Obama sent out a memo in his first days demanding from his agencies a new transparency in decision making and reporting of science and economics.

Obama’s new EPA administrator, Lisa Jackson, who is not a scientist but an engineer and career bureaucrat, promised, "As administrator, I will ensure EPA's efforts to address the environmental crises of today are rooted in three fundamental values: science-based policies and program, adherence to the rule of law, and overwhelming transparency."

Jackson’s staff immediately began putting together findings that would support a policy that justified government regulation of carbon (as in CO2) as a pollutant contributing to global warming.

Alan Carlin, a 35 year veteran of EPA with degrees in physics and economics presented a 98 page analysis of the issues he had written with a colleague. It noted that temperatures had been on a downward trend for some ten years and that models the EPA relied on had serious problems. (A fact well documented by global warming believers Orrin Pilkey and Linda Pilkey Jarvis in their book Useless Mathematics.) Most of the scientific reports cited were peer reviewed.

Carlin’s division in EPA is the National Center for Environmental Economics whose duty is "informing important policy decisions with sound economics and other sciences." (See Carlin’s other publications at http://nlquery.epa.gov/epasearch/epasearch?typeofsearch=area&fld=opeedweb&areaname=NCEE&areacontacts=http%3A%2F%2Fyosemite.epa.gov%2Fee%2Fepa%2Feed.nsf%2Fwebpages%2FContactUs.html&areasearchurl=&result_template=epafiles_default.xsl&filter=sample3filt.hts&querytext=%22Alan+Carlin%22&submit=Go )

What was the result of when Mr. Carlin and his colleague tried to inform the Obama policy decision? A few more facts.

Carlin’s boss, Al McGartland (mcgartland.al@epa.gov ), not a scientist but an economist, censored him. He sent Carlin an e mail forbidding "any direct communication" with people outside his division. When Carlin tried to distribute his analysis, McGartland wrote, "The administrator [Obama appointee Lisa Jackson] and the administration have decided to move forward on endangerment, and your comments do not help the legal or policy case for this decision. . . . I can only see one impact of your comments given where we are in the process, and that would be a very negative impact on our office."

McGartland then told Carlin to stop thinking about and talking about global warming. "With the endangerment finding nearly final, you need to move on to other issues and subjects. I don't want you to spend any additional EPA time on climate change. No papers, no research etc, at least until we see what EPA is going to do with Climate."

EPA clearly considers its work the basis of a new government policy. Contrary to the President’s orders and the law Obama’s chosen administrator and her staff are determined not to present "the evidence relied upon and the evidence discarded."

What should we now believe about the President’s promise that "the days of science taking a backseat to ideology are over"? Informed debate welcome. The ball’s in your court, Mr. President.

WHAT TO DO ABOUT IRAN--HOPE, CHANGE OR DUCK

2009-07-05T20:03:00.000-07:00

Maybe, as a friend recently e mailed me, the public dissent of mullah’s in the holy city of Qom is “the most meaningful news thus far out of Iran.” All news from Iran should be measured against this central fact: we do not know who won the election and with how many votes.

A friend in Iran who voted for the supposed loser and who very much wants reform, told me Amadinezhad won because of strong support from nationalists and by virtue of his populist appeal among poor and rural voters.

His opinion was supported by foreigners inside Iran and by polls taken by at least one credible group that used phoned into Iran using non-profit groups and pollsters speaking Farsi. The pollsters talked to over 1000 Iranians in all 30 provinces and showed Amadinezhad leading Mousavi 2 to 1, approximately the same as the reported vote count. Note, phone polls are hardly likely to be biased for the poor.

It reminds me of how many people in all parts of Russia have told me over the years how Stalin’s death brought millions of people onto the street shedding genuine tears. National leaders who seem certifiably nuts from outside a country can enjoy long period of majority popularity among their own people—Hitler, Mussolini, Stalin, Idi Amin, Fidel Castro, Juan Peron. Large protests that dominate foreign media are not valid polls.

The Iranian vote may have included fraud and manipulation in both the campaign and the actual vote and its count. That does not mean Amadinejhad doesn’t have a majority. At least one commentator has suggested that the non-Muslim media are suffering from “cell phone myopia.” They believe that if cell phones are dominated by a certain opinion, then that appears to be the opinion of the nation as a whole.
The existence of any opposition in places like Iran is a positive. Even more interesting that religious leaders in Iran’s holy city speak publicly against the Khamenei approved president. More important, what are they in favor of? Truly democratic elections? A different theocracy? Respect for the sovereignty of other countries, including their embassies and diplomats?

Western governments and Arab governments in the Middle East that fear Iran can only hope that what are almost certainly minority protest voices can become a large enough force to topple Khamenei and his man, Amadinejhad.

The European Union whose diplomats were arrested in violation of international law, has done nothing but tell Iran’s ambassadors that the situation is “unacceptable.” That’s diplomatese for we’re still thinking, don’t call us, we’ll call you. Maybe.

There is one country where “unacceptable” usually leads to a remedy, and both Europe and the US seem to be leaving the solution of what they really fear in Iran—the bomb—up to Israel. Vice President Biden said "Israel can determine for itself — it’s a sovereign nation — what’s in their interest and what they decide to do relative to Iran and anyone else." That’s diplomatese message to Iran—if you get near having a bomb, we’ll sic Israel on you.

President Obama’s chairman of the Joint Chiefs of Staff, Admiral Mike Mullens, said, “I think it’s very important, as we deal with Iran, that we don’t take any options, including military options, off the table.” (Was he quoting George Bush?)

We might sum up both US and European three pronged policy on Iran as hope, change, or duck-- talk more and hope, leave it up to the protestors to change Iran’s direction, or let Israel bail us out and duck.

ARE CANDIDATES AND PRESIDENTS DIFFERENT PEOPLE?

2009-07-03T12:43:00.000-07:00

The problem with winning a highly publicized election is that as soon as the vote count is final, you often have to pretend that the candidate was not really you. President Obama practiced even during the campaign with phrases like, “That’s not the man I knew.” His guinea pigs were other people, of course, usually friends and colleagues. Like so many candidates before him he is now disowning himself, or rather the man he once was.

This syndrome is not unique to Barack Obama, but many thought he was immune. Since he did convert from candidate to president, it’s worth comparing the two.

IRAQ

Candidate Obama originally voted against the troop surge, then said it had not reduced violence, and promised he would begin immediate withdrawal and finish in 11 months. President Obama decided the surge had worked, agreed to the Bush policy of gradual withdrawal with as many as 50,000 troops remaining for an unspecified time, abandoned his 11 month timetable, and recently congratulated the Iraqis on taking over security in their own cities.

FOREIGN POLICY

Candidate Obama said he would build coalitions to work with us in places like Afghanistan. President Obama’s request for more troops from our NATO allies was turned down. He decided on a unilateral buildup. He and Sec. of State Clinton have declared the genocide in Sudan intolerable. They have failed to get either meaningful UN action or significant help from friends. The unacceptable genocide is tacitly accepted, or they are about to rewrite the definition of unacceptable. By the usual definition the situation has become less acceptable.

Candidate Obama said Pres. Bush had alienated other countries by telling them what they must do. President Obama, addressing the Muslim world from Cairo said 32 times what “must” be done and often what Palestinians, Arabs and Israelis “must” do. This might be just talk, however, since he is not promising to do anything if those countries do not do what he says they must do. His hero Teddy Roosevelt said, “Speak softly and carry a big stick.” Obama has tweaked that to “speak loudly and carry a palm frond.”

FREE TRADE

Candidate Obama promised to renegotiate the North American Free Trade Act. He opposed a trade deal with Colombia. He has backed off on NAFTA and edged forward with Colombia, although in typical Obama style. After meeting with Colombia’s President Uribe, he said “I'm confident that ultimately we can strike a deal” but said he didn’t “have a strict time table.” In fact, that he has no time table and no clear guidelines for what “additional work” either country had to do. Perhaps in this case president and candidate are not far apart—still ambiguous, or should that be ‘nuanced’?

SCIENCE
Candidate Obama campaigned against political pressure on scientists and political meddling in scientific reports. The position remains the same since in April, President Obama said that "the days of science taking aback seat to ideology are over." In action, President Obama may be acting like the man he criticized. On March 17 a career scientist at EPA requested that his report showing faulty data used in forecasting global warming be sent to the division that directs the climate change program. His superiors told him, “The administrator and the administration have decided to move forward on endangerment [declaring data supported Congressional action on the President’s agenda], and your comments do not help the legal or policy case for this decision. . . . I can only see one impact of your comments given where we are in the process, and that would be a very negative impact on our office." The scientist’s report said about research used to support the administration’s policy that it was "at best three years out of date in a rapidly changing field" and ignores the latest scientific findings. EPA forbid him to speak publicly about his findings.

Should we be optimistic about separating science from politics when President Obama’s report on global climate change cites several times Stephen Schneider who told Discover magazine, “we have to offer up scary scenarios, make simplified, dramatic statements, and make little mention of any doubts we might have...each of us has to decide what the right balance is between being effective and being honest." To present the science Obama hired a California public relations firm that specializes in green causes.

TERRORISTS AND GUANTANAMO:

When he was a candidate the solution was easy: put them on trial or return them to their home countries and in either case close Guantanamo. Now his own Congressional Democrats have refused to fund the shutdown of Guantanamo because Pres. Obama had no acceptable plan for dealing with the inmates. Today President Obama says that what to do with terrorists held at Guantanamo (and perhaps others yet to be captured) is "one of the biggest challenges" of his administration. Which means his present position is . . . ? Well, it’s not the candidate’s position.

GOVERNMENT ETHICS

Candidate Obama seized on numerous egregious scandals involving Republicans and promised a transparent, open and ethical administration with no lobbyists. President Obama tried to nominate to high positions several people who withdrew after disclosures of tax cheating. He did manage to get one tax cheat approved to serve as Secretary of Treasury and supervise the IRS.

Candidate Obama co-sponsored a bill requiring the president to give Congress 30 days notice and an explanation of cause before firing inspectors general. President Obama, confronted with an investigator detailing the corruption of a campaign supporter in misappropriating Americorps funds (Sacramento Mayor Kevin Johnson), reacted by having his special counsel to the president for "ethics and government reform fire the investigator and give an hour to either resign or be terminated. The reason? If Johnson had not been cleared, the federal government would not be able to give his city bailout dollars.

Candidate Obama always held himself out as the candidate of change, and change he has. In fact, compared to other presidents, his inaugural speech mentioned hope and change far less than most, far behind Taft, Eisenhower, Johnson and Clinton. Now many voters are saying, “That’s not the man I knew.”

Conservatives said the same thing about George Bush as he expanded government, put tariffs on steel, enlisted Ted Kennedy to help him expand the federal government’s role in education, and created the gigantic corporate

welfare program that President Obama has gladly expanded.

In this era of candidate packaging and public relations I recall with nostalgia the motto of North Carolina where I lived for 39 years: Esse Quam Videri, To Be Rather Than Seem.

TO EMPATHIZE OR NOT

2009-06-05T13:09:00.000-07:00

This idea that empathy is a vital ingredient for public officials is not new. After my former 6th grade teacher became a doctor of psychology and political activist he wrote to me in 1962: "I am doing some research on empathy and its development and feel this to be the most significant single characteristic of man in terms of his present potential for survival and fulfillment."

Unlike our president, I do not want blind justice to decide cases of law based on empathy for plaintiff or defendant, but I’ll go with empathy elsewhere in government where it is in short supply. One reason for the empathy deficit is that rules and regulations have a built in conflict with empathy. We are all familiar with the postal worker or the IRS agent or the driver’s license clerk who says, “I’d like to help you, but I have to go by the book.”

That’s one reason Jefferson and Thoreau famously proposed that the best government is the least government. The less government, the more room for empathy.

Nevertheless, in the government, empathy has an important place. Nowhere is this truer than for the people who make the rules and regulations that once in place, will prevent the exercise of empathy. In other words, we need law makers and rule makers who either craft their work with an understanding of the people who will have to live by their rules, or whose empathy helps them understand when not to impose rules on the rest of us.

The most important component of empathy, of course, is experience—having walked in the other person’s shoes or at least very similar shoes. How ironic, then, that we find ourselves now governed largely by leaders who have spent all or almost all of their lives making and enforcing rules rather living the lives and doing the work governed by their rules.

Start at the top with the man who champions empathy even in the courtroom. President Obama, Empathizer-in-Chief, has no adult work experience outside an admittedly failed period in the non-profit sector and success as a politician. Should we be surprised that his closest advisers and aids are also without a foundation for empathy with Americans who don’t work for government?

Treasury Secretary Tim Geithner who supervises the IRS and plans for saving automakers, banks and their workers, has spent his adult life in places like the Federal Reserve and the International Monetary Fund. Having been caught with tens of thousands of dollars in unpaid taxes, however, he might have a basis for empathy with taxpayers—except he was rewarded with oversight of the IRS.

Larry Summers, who heads the President’s council of economic advisers, is the son of two economics professors who grew up to spend his entire career in economics departments and government. He may claim grounds for empathy with men who don’t understand women since he was drummed out of the Harvard presidency for suggesting the minds of men and women might be different.

Secretary of Commerce Gary Locke is a lawyer and former Governor of Washington who has been in state and federal government his entire life. He did propose firing a lot of government workers when the state was going bankrupt, so perhaps he can share the pain of employers who have to cut payrolls.

Hilda Solis, Secretary of Labor, describes herself as "a big believer that government, if done right, can do a lot to improve the quality of people's lives." To do government right requires a lot of empathy, but Solis has spent her entire life in government. Growing up in an immigrant family may give her the basis for empathy with new citizens. She has not demonstrated an empathy with American workers when she champions public funds to send illegal immigrants to college and works against measures to prevent illegal, untaxed, underpaid workers from taking American jobs.

Secretary of Agriculture Tom Vilsack has never been a farmer and after his law degree he spent almost his entire life in government. As governor of Iowa he did champion genetically modified crops and the interests of corporate agriculture. Even the huge majority of his campaign contributors came from government and government labor unions.

Secretary of Housing and Urban Development Shaun Donovan has degrees in architecture and public administration. He has worked in non-profit housing organizations and government most of his career. As head of an affordable housing program for New York City he oversaw a massive plan for affordable housing but he never had to live in affordable housing or a government housing project. And we all know how affordable New York housing is.

For the agencies that most directly affect how people live and work and that determine how the economy affects people’s lives, President Obama has chosen people like himself. Like poor people who respect money, they respect empathy. What they do have is sympathy. That is to say, they feel sorry for the difficulties of average citizens, and they want to help. That’s very different from empathy that leads to understanding, and understanding that leads to wiser or less government interference.

This difference between empathy and sympathy is why so many Americans empathize with the dictum, “The most terrifying words in the English language are: I'm from the government and I'm here to help.” I feel empathy with those words every time I fill out a government form that has a notice that it complies with “The Paperwork Reduction Act.” (The Act has an entire web site devoted to its own regulations. http://ocio.os.doc.gov/ITPolicyandPrograms/Information_Collection/index.htm )

Bill Clinton told Americans many times, “I feel your pain.” If he did, that was empathy. From government by people who lack the personal experience from which empathy comes, we can expect only pain. After which they will sympathize.

WE ARE ALL CRIMINALS (Almost)

2009-05-29T12:48:00.000-07:00

Two years after the collapse of the Soviet Union I went to live in the new republic of Kazakhstan as the resident adviser on housing and land reform. My primary partner in the new government was the first deputy minister of Housing and Territorial Development, a very bright, imaginative, chain-smoking Kazakh committed to rapid change. He probably gave me more good advice than I gave him, and one piece of it is worth repeating now.

As I tried to get up to speed on existing laws and regulations I asked my counterpart scores of questions. Less than a month into my job he put a halt to my legal questions. “Wallace,” he said, holding his hand up in the halt signal, “forget the law.”

Here was one of the few very honest men in a general sea of corruption telling me to forget the law—the very thing I had been sent to help reform. He smiled and leaned back and looked at me with amusement in those dark brown Kazakh eyes. Should he do this to me or not, he might have been thinking. He decided he should.

He leaned forward and said, “Wallace, we have laws and regulations about everything. You will never know all of them. What you need to know is that you are always in violation.” He settled back in his amused smile and let out a long, sustained stream of Marlborough smoke.

I had started working in the Soviet Union in 1989 and I recognized the moral of the story: when the rules and regulations are too many and too complex and too contradictory for anyone to understand, everyone is a criminal subject to fine or arrest at any moment.

Flash forward. Anyone in America who has to fill out a long form income tax return, and every business owner knows the truth of what my Kazakh client told me. No matter how hard you try, no matter whether you use a CPA or a TurboTax computer program, you are going to have to guess at some answers. Since even IRS help agents often give contradictory answers, it’s not surprising that many honest Americans find out that they have violated the tax law or regulations.

Those laws and regulations are written on some 50,000 pages and have to be reported on over 480 separate tax forms.

Is anyone surprised that almost one in five Americans admit to cheating? Anyone surprised that billions of dollars of small business income changes hands unreported because reporting costs time and money and you are still likely to be accused of cheating. Reporting is burdensome and may be riskier than not reporting.

A 2006 IRS study found that for the year 2001 alone $290 billion in taxes went unpaid, and that did not include taxes on illegal labor and criminal activity. The IRS says the overwhelming majority were middle class individuals—not greedy corporations or their executives. Waiters and waitresses, says the IRS, cheat on 84% of their income. The IRS estimates 57 percent of self-employed income of trades people and small businesses goes unreported.

This year an administration whose slogans include “hope and change” and “yes we can,” have a new slew of tax proposals (not to mention that the man it chose to oversee the IRS conveniently didn’t report tens of thousands of dollars of his own income until nominated and exposed).

Add to the tax mess the fact that the Obama administration is going one up on the Bush administration in adding costly new regulations on almost every kind of income making activity. Under Bush the 2008 Federal Register grew 10% to 79,435 pages. More than 4,000 new federal regulations will be finalized this year.

Back to Kazakhstan. In the January 2000 issue of its in-flight magazine the national airline warned passengers going to Korea not to try to bribe traffic police. The reason? “In some countries corruption is considered illegal.” My Kazakhstani friends who have immigrated to America have all been impressed and pleased that they do not have to bribe government officials, and that public servants are honest and helpful. But as one immigrant remarked when struggling with income tax paperwork, “It was easier back home because you didn’t have to do all this. You always knew who to pay and how much.”

I do not think we are in danger of rampant corruption among public servants, but with hundreds of new tax rules and business regulations, government is rapidly acquiring the uniquely dangerous power to force every citizen to live with his or her neck under the guillotine.

THE PLANNER IN THE GARDEN

2009-05-17T13:06:00.000-07:00

In the 18 years since I began my still tortured efforts to speak the vast and subtle Russian language I have never found a good translation for the English word neighborhood. When I went to live in the former Soviet Union for the first time 16 years ago I needed this word for two reasons. First, I had been sent by USAID and International Development (USAID) as resident advisor for housing and land reform.

The fact that I found it difficult to talk about reshaping cities without using the word neighborhood may indicate I was a prisoner of my culture where even decaying and crime ridden pieces of a city are thought of as neighborhoods. Well, hoods, but you get the point. Second, the city of Almaty, then the capital of Kazakhstan, had well established neighborhoods that were worth talking about.

Maybe it’s worth telling a story about a neighborhood I knew in Almaty because in its fate lies the central challenge for city planners worldwide.

As resident adviser, finding a place to reside was important as both a personal and professional decision. Like many foreign aid workers, I had a very liberal housing allowance. I could have lived like most ex-pats in a big modernized house or apartment, complete with cook and chauffeur. Given the nature of my work as adviser on housing reform, I believed I should learn what it meant to be a resident rather than a visiting foreigner.

I chose half of a duplexed cottage on a one lane street named for the war hero Oleg Koshevoi in a neighborhood called “Kompot” ( Russian for compote). I know no place in the world that has embodied the meaning neighborhood better than the Kompot, a neighborhood named for its many fruit trees and for streets named after their fruits. More important, the residents who lived in the two or three dozen blocks of tiny ramshackle houses themselves were something of a social compote.

Most of the families in the Kompot had been there for a few decades. My landlady and her first husband had built their 70 square meter home after the war on a tenth of an acre that they had been granted because he had been an army officer. They and the people around them built their own homes, largely with their own labor and often with materials they begged or stole from a government that could not provide them with housing. Here they made their homes and they made their families and they had begun to watch their grandchildren and even great grandchildren begin to grow up.

I chose to be resident there exactly for the reasons the Kompot is now doomed by urban renewal—it was a well established, old neighborhood where children played in the streets and any housewife knew everyone who walked by the gate. A neighborhood.

I was over 50 when I first came to the Kompot, but I knew within a few weeks that I had come home. I was glad to walk through my gate after a long day of work, change clothes and go out into the street and talk to grandmother Kim about her garden or Uncle Vanya about his Lada’s brakes or Mikhail the gulag survivor about samizdat literature and Kazakhstan’s artists. Most of all I felt at home when I played football with the kids where two streets crossed or when we used the electric lines as the top of our imagined badminton net.

I had grown up in such a neighborhood in America during the war when we were poor enough that we had to he

at the house by picking pieces of partially burned coal out of the dirt road where other people dumped their ashes. There was no shame in being poor in such a neighborhood, not any more than there was shame in being short or tall, thin or fat, old or young; Mexican, Armenian, German, or American. I chose to live inthe Kompot because this kind of neighborhood is a universal human garden, always alive with ripe fruit and new seeds.

Yes, a garden complete with society’s evil bugs and weeds, but a place that shelters its seedlings from the wilder world beyond and that nourishes and grows people and friendships. The Kompot, of course, has always been a garden that also grows the usual

vegetables and fruits from which it gets its name. It has been a place full of cherries, pears, apples, apricots, peaches and plumbs as well as grape arbors, currant bushes, berry bushes and vegetable gardens. And wild and cultivated flowers too. But this natural bounty is part of the human garden. Not only do the trees and bushes and gardens feed the human body, but they feed the soul as they grow old with the people who planted them and express the hope and optimism of the people who care for them.

I knew when I moved to the Kompot in 1993 that it was doomed. I told many of my neighbors that soon the Kompot would become one of the most desirable placesin Almaty to live and that it would undergo what we call “gentrification”—the coming of people with money who renovate and enlarge the old houses or tear them down to build new palaces. My neighbors laughed at me as if to say, “Who but we fools and unlucky people would want to live here?”

I was not smarter than my neighbors. I had simply seen the same thing happen to such neighborhoods all over the world. However, I never imagined that gentrification would be forced on the Kompot by planners who decided that they knew better how people should live. I was naïve because in America I knew such planners and their powers very well. Only three years ago we had a celebrated case in the Supreme Court that confirmed that planners could justify the destruction of an old neighborhood to build modern homes and commercial buildings in the name of progress and a better tax base.

In America we are blunt, and the planners say the old neighborhood must be torn down because it is “blighted”. Blight is something that happens when a plant or a garden is infected by a disease, and planners ask us to believe that these neighborhoods are fatally sick. This kind of planning has strewn human and development disasters across America because you can’t destroy the neighborhood without destroying the fertile human garden that the word names.

Maybe соседство (sosedstvo) suggests some of the meaning and nuances of the word neighborhood, but I don’t remember that I ever heard it used to describe a place like the Kompot. A neighborhood is both a place and a state of mind.

I know from experience that planners are intelligent people with good intentions. I also know by experience that intelligence is neither wisdom nor compassion. Planners can build a city, but they cannot grow a neighborhood. A wise American once wrote, “I would rather be governed by the first 200 names in the Boston phone book than by the faculty of Harvard.” And I say I would rather live in the unplanned neighborhood of the Kompot than in any bright and shining city created by professional planners. Why?

After working for 20 years in the former Soviet Union, I understand very well that central planning is limited to the small collection of brains and experience of the planners. It inevitably fails the needs of the much larger community and requires that community to be their collective captives. After living a life time in America, places like the Kompot have underscored our nation’s central lesson—in collective freedom great wisdom works.

Cuba, Sí! Obama, Sí!

2009-04-28T12:41:00.000-07:00

Next on President Obama’s travel schedule should be, “Cuba, Si!” The time has come and we have the right president to go to Cuba with hope and change. The question is not whether President Obama should re-establish US relations with Cuba but how. In this 60^th year of the Castro revolution, here are suggestions for a visit that would have bi-partisan, all-American support.

Like his hero Teddy Roosevelt in 1899, let President Obama lead a charge up San Juan Hill. Let the purpose be the same—the liberation of Cuba from tyranny—but let his troops wear sandals instead of boots and let them be tourists and journalists and business leaders.

From that symbolic site where Roosevelt braved flying bullets, let President Obama brave what might be a barrage of words. Let him begin with praise Fidel Castro and his successor brother Raul Castro for inviting the Congressional Black Caucus to Cuba and with them honoring the memory of Dr. Martin Luther King.

Let President Obama stand on San Juan Hill and dream of a time when the highest ranks of the Cuban government will be open to Cubans of African descent. Let him remind the Castros that among the many Americans who died on San Juan Hill were America’s Buffalo Soldiers, the men of the all black 25^th Infantry. In their honor and King’s honor, let President Obama challenge the Castros to liberate Cuba once again as they promised to do 60 years ago.

Now let the Obama friendship tour of Cuba begin. At the inevitable presidential reception, let him raise his glass in a toast to the future and offer to remove all restrictions on Americans traveling to Cuba as soon as Cuba removes all restrictions on Cubans traveling to America. Just as our Congressional Black Caucus recently traveled to Cuba as Castro’s guests, let him ask Castro to allow Cubans African descent to visit the White House. He should include among those Dr. Oscar Elias Biscet whom the Castros condemned to 25 years in prison for political protest.

Biscet has already been granted the Presidential Medal of Freedom by President Bush, so let President Obama use his faith in coalitions and the UN and remind the Castros that the United Nations called on them in 2005 for the immediate release of Dr. Biscet.

Let President Obama visit the shining new tourist hotels and promise that as soon as Cuba ends its racist hiring policies in these places, the US will allow unrestricted tourism.

Let him visit a prominent newspaper or publishing house and promise that as soon as political censorship ends in Cuba, he will encourage American firms and individuals to advertise in Cuban media.

Let him go to a Cuban radio and television station and promise to lift all bans on Cuban advertising and media ownership in the US as soon as Cuba allows truly independent radio and television and unrestricted reception of foreign media in Cuba.

Let him go to a Cuban post office where citizens can connect to the Internet and offer to send computers to any Cuban school or citizens’ organization if the government will allow uncensored connections to the World Wide Web and to such communications channels as Skype and YouTube and other social networking sites.

Even before he was elected, President Obama had brought hope and a little change to Cuba. Visiting journalists reported signs and graffiti appearing with the Cuban version of “Yes, We Can.” (A phrase the Obama campaign originally borrowed from the Spanish of Latino farmworkers striking with Cesar Chavez.) So, when President Obama is wrapping up his Cuban tour, let him stand side by side with Fidel or Raul Castro or both of them. Let him raise their hands with his and let him say his message as Cubans say it, “Sí se puede, coño.” (Yes, it’s possible, dammit.)

(Footnote: he might want to omit coño which is somewhat stronger than dammit, giving the phrase more the sense of, “Yes, it’s possible, f**ker.” and we suspect that if the President said only "Sí se puede" the Cuban people would fill in the rest. )

OBAMA'S HEMINGWAY PROBLEM

2009-04-23T10:04:00.000-07:00

A closer look at what the Obama administration is saying and doing about the banking industry shows that critics who charged socialism when it seemed Obama was close to nationalizing the banking industry were wrong. What he is doing looks more like the fascist system of government dictatorship over business. Or, as economist Alan Reynolds puts it, “The deeper purpose of the Treasury's ‘capital purchase plan’ appears to have been . . . to ensure that big financial firms will now be managed according to the principles of politics rather than economics.”

The method of setting up the system also bears similarities to fascist methods of winning public support—the propaganda of fear. This kind of fear requires dividing the country into us and them. This comes naturally to politicians who have built much of their careers on the idea that novelist F. Scott Fitzgerald was supposed to have embraced-- “The rich are different.” Fitzgerald, creator of The Great Gatsby, never wrote or said that. It was a lie Hemingway told about him.

Fitzgerald replied, ''Riches have never fascinated me, unless combined with the greatest charm or distinction.'' Politicians, for their part, have never been interested in the rich as fellow human beings. Except for their rich friends and campaign contributors, the only use politicians have for the rich is to call them greedy and cold hearted while in private squeezing them for campaign contributions.

Side note: notice that the politicians seldom call their own rich campaign contributors greedy. Thus, the concentration on private bankers' and investors' high salaries while not a word about the often higher salaries and percs of Hollywood stars and pro athlets and university presidents. Not a word about the high salaries of officers in government run corporations like FNMA or of people in the World Bank or IMF where Tim Geithner and Larry Summers used to work.

Hemingway invented a conversation with Fitzgerald in which he has himself reply to "the rich are different." He puts down his old friend with, “Yes, they have more money.” That exchange actually took place when Hemingway, then quite rich himself, told literary critic Mary Colum that the rich were different. She put down Hemingway with the reply, ''The only difference between the rich and other people is that the rich have more money.''

Hemingway, of course, was like so many rich dilettantes, secure in his wealth while romancing socialism. Maybe Hemingway stole Colum’s wisdom and claimed it for his own out of guilt at being a rich and increasingly lazy drunkard. He knew that Colum spoke the essential truth, one that wold rob the present administration of its scapegoat. “Wall Street” (whoever that is) and bankers are no less and no more greedy or compassionate than other human beings.

So why is President Obama, the self-declared reconciler and unifier leading a team that is intent on pretending superficial economic differences are moral chasms between innocent suffering and evil greed?

The easiest excuse, of course, is that he has set aside only a small group of the rich as villains, and why cry for those who have the consolation of wealth? We do note that his villains are those rich who generally did not support his campaign or his policies.

More important than the numbers or the victims' resources is the President's methods. Scapegoating a small group is a typical fascist ploy for popular support. The President is neither embraces fascism nor does he hate his fellow rich Americans. Even more reason for him to reject fascist tactics that have never achieved anything but making trains run on time before disaster hits.

I suspect that this wealthy President who grew up in modest circumstances and who succeeded on a combination of talent and membership in a favored class, and who then, by his own admission, failed as a community organizer among the poor, feels considerable guilt. So did Ernest Hemingway. The aging writer, unable to change or redeem himself, losing his literary powers, ended his binge of drinking and self-glorification in suicide.

Obama, young and enjoying the highest political power, has chosen to work toward compassionate ends through cold-hearted means. Villifying productive people, telling them how much they can earn, telling them it’s their patriotic duty to pay higher taxes, and even telling them when they can return government money they didn’t want will result in alienating or paralyzing not just a few bankers, investors, and auto industry executives. It has already begun to send productive people looking for hiding places and escape routes.

The combination of spending binge, higher taxes, and propaganda campaign can destroy the economic hopes of the poor and the middle class. In a country where almost everyone wants to be rich, and where they can vote, Obama’s methods will not lead to fascism. They could lead to political suicide. In the life that exists beyond that limited death, President Obama would continue to be rich, and the poor he wants to help would continue to be poor.

Are You Nobody Too?

2009-04-16T16:05:00.000-07:00

You’ve seen it or you can see it—the way 47 year old, beetle-browed, double chinned Susan Boyle stuffs a sandwich in her face, tells the backstage interviewer she’s ready to sing, then stumps out onto the stage of a nationally televised British talent show. She dares to confront a live audience of mainly young and hip Brits in her nondescript beige dress that covers her thick body more like a tube than a garment. Her sturdy legs protrude from below and terminate in white high heels that she uses somewhat as if they were stilts. If you haven’t watched, please do it now: http://www.youtube.com/watch?v=9lp0IWv8QZY

The three judges make a chick sandwich—two tanned unblemished guys flanking a sleek young blonde. Watch the guys snigger as she introduces herself. “And what’s your name, darling?” asks the youngest guy leaning back and playing with his pen. He asks her age and rolls his eyes when she says she is 47. When she says she wants to be as famous as Elaine Page, the beautiful blonde who starred in the debut of Evita, judges and audience faces wince and snigger.

By her own description she was just another Scottish woman living alone with her cat Pebbles, singing in her church choir, never married, never courted, never noticed outside her own circle of friends. Today over 12 million people have watched her sing on YouTube.

What made her an instant sensation on the Internet and British and American television? Not her sure enough good singing voice. Her real triumph was the way she suddenly and decisively smashed and shamed the smug superiority of the three gliteratti judges, the two fay, condescending back stage assistants, and an audience ready to laugh at a bush-browed, sack-of -potatoes woman who dared sing for them in a national talent show.

And what will she sing a judge asks. “I Dreamed a Dream” from Les Miserables she announces confidently to the audience that clearly pities the dreamer. Within a few bars not just her voice but her confidence and her identification with the song lift both audience and judges out of their seats. They are applauding and shouting approval. She sings on. The song is everything.

If you don’t know the song, it opens with this stanza:

I dreamed a dream in time gone by
When hope was high,
And life worth living
I dreamed that love would never die
I dreamed that God would be forgiving.

The last lines are these:

But there are dreams that cannot be
And there are storms
We cannot weather...

I had a dream my life would be
So different from this hell I'm living
So different now from what it seems
Now life has killed
The dream I dreamed.

As the applause and screaming approval die down, the older of the two male judges tells her that when she walked onto the stage “and stood there with that cheeky grin and said, ‘I want to be like Elaine Page,’ everyone was laughing at you.” The younger guy says he had been expecting “something extraordinary” and it’s clear he means extraordinarily bad.

Few people, even professional actors and singers, have ever turned an audience around as decisively as this Scottish nobody. And she did it not by acting or performing in any professional sense.

Those judges, theater people, television hotshots, and the hip audience—they all had a dream. Their dream was that they were somebody and other people were nobodies. Many of us dream this to justify ourselves, and most of us know better. Emily Dickinson once played on this theme with her lines:

I'm nobody! Who are you?
Are you nobody, too?
Then there's a pair of us -- don't tell!
They'd banish us, you know.
How dreary to be somebody!
How public, like a frog
To tell your name the livelong day
To an admiring bog!

Susan Boyle proved that inside every nobody is a somebody. Perhaps she reached inside of those frogs and that bog and killed their dreams. But she brought back life to their hearts.

Inheritance Tax: Making Death Fair(er)

2009-04-09T12:58:00.000-07:00

"The fairest death tax rate is zero" The Wall Street Journal argues once again today. I would revise their statement to say, "The government should not be among a citizen's heirs." The Journal backs up its position with a bogus supporting argument: "because the money was already taxed when it was earned." The Journal's sword has all the piercing power of a wet noodle.

By the Journal's "logic," if I have a net $1,000 after paying taxes on my income, and then I pay that $1,000 to a carpenter to build a deck, the carpenter's income should not be taxed because I already paid tax on it.

The carpenter, at least, earned the $1,000 by exchanging labor and talent for my money. Most heirs have done nothing except they were begat by the right parents. For the child, conception is a supremely passive act requiring neither talent nor labor on its own part.

Large inheritances do create significant inequalities in opportunity. All of us who were conceived by parents who were poor when they made us and continued to be poor until they left us can list numerous important inequalities of opportunity. Like Andrew Carnegie, I am against inheritance. I am equally against government taking any portion of wealth left by a dead citizen.

Government itself, meaning politics, is all about distributing opportunity unequally. That is exactly why politicians want to rifle the pockets of the dead--so they can distribute opportunity to their favorites.

I propose some examples of how we might create more equal opportunity with what the dead could not take with them.

Let the rule be that inheritance can consist of a house and funds for higher education but no more. If an heir has earned part of the family business, let that ownership be established before the parent's death and bear some recognizable equivalence to work and talent. Make reasonable provision for keeping the business in the family by allowing the heir to pay tax on the remaining ownership interest out of profits or by selling sell it. Require that all wealth remaining after such inheritance be distributed in one of the following ways:

--as a pro-rata tax reduction for all Americans

--as a donation to the qualified charity of the deceased's choice

--paid into an independently operated national endowment whose income would reduce interest rates on student loans or venture capital for first time entrepreneurs

To make this politically popular, call it The Fair Death Stimulus Plan.

The Kaufman Income Tax Leadership Act

2009-04-03T08:36:00.000-07:00

Herewith I propose the 2^nd of a series of very simple laws to fix very complex problems which I immodestly call The Kaufman Acts. The law I propose would have one of two effects—the cleansing of our tax code or of Congress. Should any member of Congress have the courage and wisdom to introduce my Tax Leadership Act, even defeat of the bill would certainly lead to proposals for a much simpler income tax or the defeat of many members of Congress who have made the present tax code a piñata of favors and a Sword of Damocles hanging over the heads of their fellow citizens.

The Kaufman Income Tax Leadership Act

Whereas, the near impossibility of correctly filling out income tax forms makes lawbreakers out of millions of Americans, and

Whereas, it would be a national disgrace to have our law makers and law breakers be one and the same,

Therefore, the Congress of the United States hereby declares that every member of Congress shall fill out personally his or her income tax forms and declarations, and

Therefore, any Member omitting required information or making an error in calculation shall pay a fine of no less than $1,000.00 or twice the amount of his or her annual tax payment, whichever is larger, and

Therefore, any Member omitting required information or making an error in calculation in two subsequent years shall become ineligible to vote on any tax measure before Congress, and

Therefore, any Member omitting required information or making an error in calculation in filing any three federal tax declarations shall become ineligible to serve in the next Congress or to hold other federal office for five years.

What Is President Obama Saying To Sudan?

2009-03-24T21:49:00.000-07:00

A week ago I referred to the problem of genocide in Sudan as President Obama’s “practice test” in foreign policy. The President, like Sec. of State Clinton said of Sudan’s rulers, “they will be held accountable for the lives lost." During his campaign he used Darfur to distinguish his policies from Bush’s. He agreed with Joe Biden that we should help “enforce a no-fly zone.”

Yesterday well known civil libertarian Nat Hentoff made that proposal the centerpiece of his demand that the President back up words with action that would save lives. He noted that the no-fly zone proposal was proposed again by yet another Obama adviser, General Merrill A. McPeak writing in the Washington Post on March 5.

Obama’s UN ambassador Susan Rice who once envisioned a bombing campaign to save Sudanese Africans now restricts herself to futile talk with African nations in the UN. Hentoff notes that as Vice President Biden has been silent while the Sudanese government uses its helicopter gunships and bombers to abet the slaughter of black Africans. Hentoff notes that now that France has decided to join NATO, its airbase in Chad would be an ideal place from which to enforce a no-fly zone.

With a voice familiar and respected among civil rights advocates, Hentoff asks, “What, if anything, do you have to say, President Obama, about helping to energize the creation of a no-fly zone so that, on your watch, we can finally say ‘never again’ - and mean it?” Jerry Fowler, the president of the Save Darfur Coalition who supported Obama during his campaign, recently said, "We need presidential engagement and we need it now."

Darfur is quickly passing from the President's practice test to a practical test. So far the president has said little, but his choice of a friend and close adviser as special envoy to Sudan may be a sign that something's in the air. Retired Air Force General Scott Gration is a former fighter pilot.

Bestiality Then And Now

2009-03-20T13:06:00.000-07:00

The Florida legislature has just offered a convincing demonstration that the South is no longer the “agrarian South.” After five decades of writing, and now raising a 12 year old son, I have become painfully aware that much of the vocabulary meaningful to one generation is lost to another. (Should I thus explain that agrarian refers to agriculture?)

The Florida event I’m referring to quickly made national news, but for the wrong reason. Florida Democrat state senator Larcenia Bullard had questions about a bill that would once more outlaw bestiality in Florida whose previous law had been declared unconstitutionally vague. (For the younger readers who might not know the word bestiality, suffice to say it has nothing to do with Beasty Boys.)

The new law clarifies the act and exempts dog shows and “animal husbandry”. Senator Bullard was horrified and asked, ''People are taking these animals as their husbands? What's husbandry?'' After hearing that it was raising and caring for animals, she asked about the Connecticut incident where a chimpanzee attacked a woman, ''So that maybe was the reason the lady was so upset about that monkey?''

Bullard’s unfortunate vocabulary gap inspired a viscious attack from television monkey Keith Olbermann who nominated her for his “Worst Person In The World” award. While Bullard’s gaffe was funny, it hardly merits Olbermann’s attack on a minority politician (or any person).

We could write off the gaffe as a generational thing, the South and especially Florida no longer being agrarian, except for Senator Bullard’s qualifications. She was born in the decidedly agrarian South Carolina in 1947. She has a bachelor’s degree from Antioch University, an AA from Temple University, and a Masters of Social Work from Nova University. She began her professional life as a teacher and became an educational consultant. She sits on the Pre-K to 12 Education Committee, the Higher Education Committee and the Senate Agricultural Committee.

Mocking poor Sen. Bullard misses the real issue. Her gaffe should make one wonder how any native born citizen can graduate high school, earn three degrees in higher education, become a teacher, become a government official shaping public education, and sit on a committee that oversees agricultural law and not know the meaning of the 600 year old English word still in good standing.

Footnote: Sixteen states permit bestiality. In a time when strong currents in our culture have created the ‘sexual revolution’ and have spread increasing acceptance of once banned sexual practices and pairing, it’s worth noting that the Florida bill was inspired when a Senator promoting animal rights heard that a man making love to a goat had accidentally strangled the animal by grabbing its collar too tightly.

The sponsor is trying to balance human rights against animal rights, although the language does have a Puritan flavor to it. It bans acts in which the human obtains “sexual gratification,” or pleasure. It is an advance, nevertheless, from September 1642 when a jury in the Plymouth Colony found a teenager guilty of bestiality, and before the boy was executed, “first the mare and then the cow and the rest of the lesser cattle were killed before his face, according to the law.”

The Puritans, of course, knew the word husbandry well. We have expanded our tolerance but only changed our vocabulary.

Obama, Frank, Dodd and AIG

2009-03-19T04:00:00.000-07:00

Yesterday Congressman Barney Frank and Senator Chris Dodd were lashing insurance giant AIG for the bonuses paid to keep high level employees working on a selloff of assets so it could repay money loaned to it by taxpayers.

Yesterday Fannie Mae and Freddie Mac, the government sponsored firms for which Frank and Dodd helped in their cover-up of disastrous lending and accounting and which they sheltered from the eyes of regulators, disclosed that they were paying millions in bonuses to hundreds of top employees.

Fannie Mae, the government mortgage company will pay chief operating officer Michael Williams a retention award of $611,000 this year, more than double his award last year. His base salary $676,000 a year. For leading the operations that cost tax payers billions, Mr. Williams will receive over $1 million this year. Vice president David Hisey will get a $517,000 bonus and two other vice presidents will get $470,000 each. Freddie Mac has not yet revealed its bonuses.

What is the reason employees of these government firms that have been big donors to the campaigns of Frank, Sen. Dodd and Sen. Obama will get such rewards for losing $108 billion of taxpayer money last year? The same reason that AIG gave for its bonuses.

James Lockhart directs the Federal Housing Finance Agency, or FHFA, which regulates Fannie and Freddie, and explains that, "it would have been catastrophic to lose the next layers down and other highly experienced employees." In addition the government has promised each of its companies $200 billion more of taxpayer money.

Barney Frank called for the names of all AIG employees who received bonuses despite several threats against their lives. Will he also call for the names of hundreds of Fannie and Freddie employees? While he’s at it, will he also reveal to which members of Congress they gave donations?

Perhaps it will take presidential pressure. President Obama has also has called for AIG executives to give back their bonuses. “It's about our fundamental values," he said.

As a brand new Senator Obama somehow quickly became the recipient of FNMA’s second largest campaign donations. AIG’s new Chief Executive asked for his employees to return their bonuses. Will our new chief executive in the White House ask the same of his employees? Private enterprise has set the example but so far the President has failed to follow. Are we too audacious to hope for change?

The Kaufman Fair Pay Act

2009-03-18T14:38:00.000-07:00

Herewith I immodestly and perhaps naively propose the first of a series of very simple laws to fix very complex problems. I will immodestly call them The Kaufman Acts.

The Kaufman Fair Pay Act is four simple clauses.

Whereas, members of Congress have overwhelmingly gone on record as declaring that corporate executives should not grant themselves salary increases and bonuses when their stockholders are losing money or reward themselves more grandly than their stockholders,

Therefore, the Congress of the United States hereby rescinds the automatic pay raises members have voted themselves, and

Therefore, Congressional salaries shall be reset to the levels last determined by an open vote in Congress, and

Therefore, the annual salary of every member of Congress shall rise or fall by the same percentage as the rise or fall of the inflation adjusted income of the average American taxpayer.

President Obama's Practice Test

2009-03-17T20:21:00.000-07:00

Must President Obama find his equivalent to Reagan’s “Evil Empire” and Bush’s “Axis of Evil"? Even if he can find a euphemism for a word many once made synonymous with what they said was an arrogant righteousness, no one can deny the nature of the men who govern Sudan.

New York Times columnist Nicolas Kristof has seen many horrors around the world, but wrote of Sudan, “nothing prepared me for Darfur, where systematic murder, rape, and mutilation are taking place on a vast scale, simply based on the tribe of the victim. What I saw reminded me why people say that genocide is the worst evil of which human beings are capable.”

In addition, the essence of the situation is racism—ruling ethnic Arabs enslaving and slaughtering black Africans. On March 4 the International Court indicted al-Bashir on 7 counts of war crimes. As long ago as 2004 Secretary of State Colin Powell found bipartisan support when he said al-Bashir’s regime was guilty of genocide. Can even a moral relativist doubt that whether Sudan is on an axis or just a point, its regime is evil?

This week Sudan’s President Omar al-Bashir ordered all major foreign aid agencies out of the country. Secretary of State Clinton said the move would create "untold misery and suffering." She also warned the Sudanese regime that it would be “held responsible for every single death that occurs in those camps, because by their expulsion of the aid workers ... they are putting those 1.4 million lives at risk."

Now President Obama must fulfill that promise or lose his credibility in world affairs. So, how will he hold al-Bashir responsible? Broadly described his policy choices are three:
--diplomatic pressure and criticism
--economic and political sanctions
--military action which might be through the UN, by a coalition, or unilateral
--do nothing

The President campaigned on and entered office with a promise to resolve international crises through diplomacy and coalition building, the kind of solution he said Bush should have used in Iraq. So far the preferred option is the same option that has failed for more than four years—diplomacy and consultation with the UN. The immediate goal, says Sec. Clinton, is nothing more than reversing the expulsion order.

If it works, where are we? Foreign aid and humanitarian agencies have been in Sudan for more than a decade, and neither they nor diplomacy have stopped the slaughter. The UN Security Council offers little hope since China and Russia oppose sanctions and will certainly oppose stronger action. Besides, UN sanctions in Iraq were widely criticized for both increasing the suffering of Iraqis and funding Hussein’s weapons program through UN corruption.

The situation President Obama faces in Sudan is not very different from the situation President Bush faced in Iraq in 2002, except that Sudan has far less strategic importance, and there’s not even a suspicion Sudan poses an external military threat. That leaves President Obama to try to pull off a diplomatic miracle or use force.

The only other option is to say we care deeply, stir the world to sympathy with moving speeches, and watch the slaughter continue. Obama has professed great admiration for Teddy Roosevelt whose policy was “talk softly but carry a big stick.” Talk much and do little might fit under the Nixonian definition of realpolitik, but it won’t satisfy the desire for hope and change.

Joe Biden during the campaign made his famous warning that a foreign power would put Obama to a serious test in his first months in office. Sudan is not that test, but it may be a test of the President’s ability to pass the coming test.

Where A Good Environmentalist Would Put Her Sunday Paper

2009-03-15T22:13:00.000-07:00

We hear the latest campaign to save American forests and their absorption of CO2 focuses on toilet paper. The British Guardian offers this quote from a scientist in one of America's leading environmental organizations, NRDC: This is a product that we use for less than three seconds and the ecological consequences of manufacturing it from trees is enormous," said Allen Hershkowitz, a senior scientist at the Natural Resources Defense Council. "Future generations are going to look at the way we make toilet paper as one of the greatest excesses of our age. Making toilet paper from virgin wood is a lot worse than driving Hummers in terms of global warming pollution."

Finally, the anal nature of environmental puritanism has come out in the open. Before we switch to recycled toilet paper, as the Guardian says 40% of Europe does, we should like to know what chemicals are used to reprocess paper, where those chemicals go, how much energy is used, and where the chemical inks that are removed go.

Also we might note that even recycled toilet paper cannot be recycled again. Now, if all the environmentalists who enjoy reading the Guardian or The New York Times would simply recycle those forest destroying pages in their bathrooms, we might believe they are serious about environmental toiletry. Their practice would warm the heart and not the planet.

Presidential Vocabulary Doesn't Inspire Confidence

2009-03-08T10:59:00.000-07:00

At his news conference with the British Prime Minister, President Obama responded to a question about the plummeting stock market by saying, "What I am looking for is not the day-to-day gyrations of the stock market... but the long-term.''

As a gifted writer and speaker, Mr. President, you should know that a gyration is a rotation around a central point. Since Americans elected you for hope and change, the market has been on a steady downward trend that has wiped out over 30% of the retirement savings plans of millions of Americans and the pension funds of unions and churches, and the endowments of colleges and universities and charitable foundations.

We suppose that a steady downward spiral could be a form of gyration, but it’s one that is worth a president’s attention. Yes, this trend is recorded on the Wall Street that the President has criticized, but it's a trend that reflects the entire economy. Paying attention is part of staying in touch with the people.

Mr. President, we know you do not have an MBA like the former president, so it is unfair for the press or critics to laugh at you for saying, "On the other hand, what you're now seeing is profit and earnings ratios are starting to get to the point where buying stocks is potentially a good deal, if you have a long-term perspective on it.''

We appreciate the confident investment advice, Mr. President, and while we understand you studied International Relations and law, but it's important to know that a ratio is not X ‘and’ Y but X ‘to’ Y, and the correct term is not “profit to earnings” but “price to earnings ratio.” Price means the price of the stock, something very very different than profit.

As millions of homeowners and pensioners know, all the profit in a price can disappear very quickly. Profit and price, of course, both begin with a P and the tongue does slip occasionally as you probably noticed when the press guffawed about your predecessor’s slips.

It’s forgivable in the heat of a campaign to slip up and say, “I’ve now been in 57 states,” or that they speak Arabic in Afghanistan, or to declare 10,000 dead in a tornado that killed only 12, or to speak of “the bomb” that fell on Pearl Harbor (even if you are a native Hawaiian).

However, a president who understands that confidence moves markets and the economy needs to convince citizens that he knows the difference between a gyration and a trend, between a profit and a price. In politics ignorance and confusion can come with a very high price and no profit.

Will Barney Frank Have Himself Arrested?

2009-03-07T10:31:00.002-08:00

In an interview on CNBC on March 5, Representative Barney Frank said financial regulation was necessary, but "Perhaps most importantly, the American public has the right to know what enforcement actions are contemplated against those irresponsible and, in some cases, criminal actions that lead to the current situation.”

While he did not name names, we would like to note the following irresponsible statement by a man overseeing Fannie Mae and Freddie Mac as they were going bankrupt and losing billions of dollars invested by pension funds and other Americans, all the while still promoting subprime loans, and making large donations to members of Congress.

“I do not think we are facing any kind of a crisis. That is, in my view, the two government-sponsored enterprises that we’re talking about here, Fannie Mae and Freddie Mac, are not in a crisis. We recently had an accounting problem with Freddie Mac that led to people being dismissed, as appears to be appropriate."

"The more people, in my judgment, exaggerate a threat of safety and soundness, the more people conjure up the possibility of serious financial losses to the treasury, which I do not see. I think we see entities that are fundamentally sound financially and withstand some of the disaster scenarios. I do not think at this point there is a problem with a threat to the treasury." (Sept. 10, 2003)

These are statements by Rep. Barney Frank, House Financial Services Committee Chairman Barney Frank who runs virtually unopposed. Since 1989 he took over $40,000 in campaign donations from FNMA and he once had a romantic relationship with a FNMA executive. His 2006 campaign took in over $200,000 from real estate, banks and mortgage lenders. These institutions suddenly began to dominate his list of top donors in 2004 and continued to dominate in 2006 and 2008.

Rep. Frank has not yet said what enforcement actions are appropriate in this case.

A Fair $200 Billion Stimulus/Tax Cut and Emancipation Proclamation

2009-03-05T18:22:00.000-08:00

If President Obama wanted to immediately pump $200 billion into the American economy, give all tax payers a simultaneous rebate, and emancipate Americans from 3.8 million days of unpaid enforced labor (read 'slavery'), it can be done quickly by simple legislation. First I explain the figures.

The annual report from Nina Olson who is chief of the IRS Taxpayer Advocate Service tells us how much time and money Americans spend to comply with a tax code that she says requires a "sanity check."

She estimates the cost of compliance to be $193 billion a year. Others estimate as much as $300 billion. So I use $200 billion. Every earner must fill out a form. This is unpaid, forced labor, usually known as slavery. Americans spend 7.6 billion hours in this work, or 3.6 million full time person-days of labor.

About the 20 volume 16,000 page long tax code Nina Olson says, "The tax laws should be simple enough so that most taxpayers can prepare their own returns without professional help, simple enough so that taxpayers can compute their tax liabilities on a single form . . . "

Allowing for certain necessary boiler plate legalese and a few qualifications, Congress could pass and President Obama could sign a 10 page tax code. The heart of it would read something like this: Every American shall pay a tax of 17% on that part of his or her earnings that exceed $35,000 a year.

That would exempt tens of millions of the lowest paid Americans from all federal income tax. It would emancipate millions more from involuntary servitude. It would allow the 80% who pay someone to help with taxes to save those millions of dollars. It would give much needed certainty to investors and entrepreneurs. And it would still bring in the same amount of taxes the government gets now, and probably more since fewer people would cheat.

How's that for an instant, fair, and understandable stimulus that works?

Now Do Republicans Get It?

2009-03-04T14:04:00.000-08:00

Quick, look, bipartisan agreement—Republicans lost Congress and the presidency because they were not Republicans. Democrats loved to talk about the big spending and deficits approved by President Bush and the Republican Congress. They welcomed several chances to turn greedy and licentious behavior into examples of a general Republican failure to live up to their own moral righteousness. They could get away with this because Republicans were often too slow in distancing themselves from self-disgraced colleagues.

Under Bush the Republican Party, like the Soviet Union, always had a few brave and vocal dissidents who said the Party had lost its way. Fortunately, they were not treated as badly as Soviet dissidents (or even as badly as Democrat dissenters like Joe Lieberman). Today it is fashionable among Republicans to say Sorry, we screwed up. We didn’t act like true Republicans. That’s how the new head of the Republican Party began his reform campaign: “Republicans did not listen, spent like out of control liberals and voters made them pay for their mistakes in 2006 and 2008.”

There we have bipartisan harmony—Republicans were not Republicans. They deserved to lose.

Whether from sincerity, to win public approval, or to keep up with the Democrats, the Republicans chose as their new Party chair a black man, former Maryland Lt. Governor Michael Steele. Perhaps Republicans chose him from all three motives, but judging motives is the kind of thing over which Democrats spend an inordinate amount of time and political capital.

Republicans chose well. Joe Biden once said President Obama was successful because he was "the first mainstream African American who is articulate and bright and clean and a nice-looking guy." Steel’s kind of average looking but bright and articulate and conservative with broad appeal among black voters. He looks like a Republican four star general.

He walked into office and declared, “Your Party’s OPEN for business and I am cleaning house.” Sounds like he gets it. Not if his recent invitation to an Oregon fundraiser and party renewal event indicate what he gets.

Who are the honorary guests at this “renewing and rebuilding" event? Same Republican Senator who’s been in Washington throughout the Bush term without much dissent. He is accompanied by rich and well established Republicans. Nothing against these folks, but how does their dominance demonstrate a commitment to finding new voices and talent?

Oh, and did I mention it’s a talking heads event? That’s the way to encourage participation and demonstrate new thinking.

“OPEN for business”? For a price. $40 to hear the speech. $1,000 for a VIP reception. If you want to eat, please write a check for $10,000. And no matter what you pay, please wear a business suit.

As a kickoff to fulfill a promise to widen and rebuild the Republican Party this event says Michael Steele or the Party planners just don’t get it. The Party of the $10,000 meal is a party of limited appeal. Sure, both parties resort to such exclusionary events to raise the political war chests, but Democrats can get away with it because they never hesitate to flay those who pay. In fact, some of the most prominent Democrats who pay to play often indulge in self-flagellation. Republicans, perceived to be the party of the fat cat, are held to a higher standard. If they want to prove they are different, they should hold themselves to a higher standard.

THE PRESIDENT CAN WRITE, BUT CAN HE DO MATH?

2009-03-02T16:29:00.000-08:00

PRESIDENTIAL MATH: Our Future Depends On It

President Obama’s promise to cut the federal deficit in half in his first term relies on his assumption that the real Gross Domestic Product (GDP) will grow 3.2% next year, 4% in 2010, and 4.6% in 2012. We know he can write, but can he calculate?

He did not tell us how he calculated future GDP so let’s ask if history says his results, and thus the future hope he promises, is reasonable.

Since 1930 the average annual growth rate of GDP was 3.4%, and that included three years of WWII when it was over 17%. If we begin in 1945 average Real GPD increased 3%. In the nine years and 36 economic quarters from January 2000 through December 2008 real GDP grew faster than 3% in only 9 quarters. (All figures from US Bureau of Economic Analysis)

Conclusion: President Obama rests his economic plan on the calculation that real GDP for the three years starting in January 2010 the economy will grow faster than its 64 year average since WWI and that it will consistently grow faster than it did in 25 or the last 36 quarterly reporting periods. If the President would show us how he did his math, we would know whether we should call that math presidential or political.

The President As Investment Adviser Suggests Health Care

2009-03-01T12:04:00.000-08:00

NATIONAL HEALTH CARE: Follow the metaphors.

President Obama is a gifted writer and chooses his words carefully. During the campaign when he tended toward the complex, supporters said he was “nuanced.” Paying attention to his choice of metaphor and the nuances of his words makes his message quite clear. Take health care as an example.

The President in his state of the union address used the word investment almost a dozen times. Before, during, and since that address he has often referred to $634 billion for health care as a down payment. He asks us to believe, in other words, that he will take from us some $634 billion as our investment manager and use it as the down payment on a health care system.

Let us put aside the fact that 47% of the country did not choose Mr. Obama to manage their investments, and that almost certainly the 53% who voted for him to be President, were not voting for him to manage their investments. Since he is going to invest for us, I pose two questions.

First, if $634 billion is the down payment on our investment, what is the total cost of this business? He is not saying. Are we prudent investors to hand over $1,800 for every man, woman, and child in this country as a down payment that obligates us to entirely unknown future costs?

Second, what is the nature of this health care business our investment manager wants us to get into? Ultimately, he and advisers have told us many times, it is a national health care system run by government. In other words, the government would create an HMO (Health Maintenance Organization) with a monopoly on service and whose board of directors are several hundred politicians who know little about medical care or even biology and almost as little about business and investing. Their management team will be tens of thousands of anonymous bureaucrats. Many will be chosen not for expertise but for political connections. Most will be almost impossible to fire, no matter how incompetent.

Fortunately we already have some data to evaluate how prudent this investment might be. The government through Medicare, Medicaid, the VA, SCHIP, and other programs already owns 47% of the medical care business. Costs have risen much faster than inflation. Medicare operates its hospital insurance in the red. While most businesses can and do cut costs to break even, the costs of running the government’s share of health care have risen steadily over 40 years.

President Obama is admirably clear in how he is going to manage our money and what he will do with it. What is not at all clear is how many Americans of any party would willingly give their money manager the green light on such an open ended investment.

The Market and The President

2009-02-28T22:26:00.000-08:00

A friend who says her family is now "running on fumes" because their investments have almost vanished, wonders why the market has not responded to the President's message of hope and change. "What spooked the market?" she asks.

First, I hope the PC police do not jump all over her for a question whose vocabulary they might think has racial overtones. Next, I suggest the answer is uncertainty. For investors uncertainty and risk are synonymous.

People do not take risks (which is what investing is) when they don't know what the tax rate will be next month or next year. They don't invest when they are uncertain if government is going to compete with the company they want to invest in. (Think $634 billion President Obama is going to spend somewhere on health care. Think billions he wants to invest in some forms of energy but not others.) They don't invest when massive government deficits and unchecked printing of money are likely to cause rampant inflation.

Not only do they not invest, they sell a lot of investments. When uncertainty and pessimism cause more selling than investing, the market goes down. The millions of people who make up the market may be wrong about the President's proposals, but they are not playing with monopoly money. Most are risking their own money or money someone has put in their trust. Many have been entrusted with the pension funds of millions of Americans, funds already cut in half.

Investors are sending a very clear message--even those who like the President personally are not yet willing to invest in the changes he has proposed. I would ask my friend whose family is running on fumes whether she is investing now. It's one thing to vote for change, another thing to bet your money where you put your ballot.