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THESE ARE OUR SAVIORS? SPARE US!

THESE ARE OUR SAVIORS? SPARE US!

It is interesting that people who hate government are so desperate to be involved in its epicenter. Thus we have Bennett of Utah and now Lugar of Indiana who are insufficiently right wing to cut the mustard, and must go – and have gone.

 Apparently the rationale of the far right wing is to get into government so that they can destroy it. There seems to be an attitude that government is inherently bad and that we must follow the constitution in order to defray its excesses, real or imagined. This view is the opposite of the view of the Founders who wrote the constitution and considered government to be a noble exercise of representative democracy, the central thread/rationale for having a government in the first place.

I am of the opinion that a lot of the line we hear from the right is false by design; that they care little of the real issues of the day (unemployment, international trade issues, the environment etc.), but use them very cynically for the purpose of effectuating their real design, which is to make the rich and corporate class richer with a view toward a form of a latter day feudalist state in which we are the vassals and corporations are (effectively) the state. I have blogged on this topic a couple of times to this effect.

Methodologies to make this happen include privatization efforts (designed to make profits and remove public control over public matters such as education, social security and other now government programs where lots of money is there for the taking). It is important in such a scheme of things that all such programs subject to privatization be trashed by pre-takeover propaganda about how  cost ineffective and un-American they are, how government cannot do anything right, and how private enterprise can come in on the white horse and save the day.

There are those of us who disagree with this cozy assessment; we have seen the bankrupt prone Trumps, Gilded Age trusts, the Enrons, Madoffs et al. and have witnessed firsthand the performances of those on the white horses in our recent bailouts of these intrepid horsemen, who never met an asset that could not be securitized.

These are our saviors? Spare us!

It appears that the role of government should properly be to bail out the rich but leave the poor and the veterans under the bridge in the far right wing’s philosophy of government. It seems to me that if the only real purpose of government is to serve as a blocking back for the rich ball carrier to make money, whatever the pretense and propaganda, then it is time to cancel the game. I, for one do not wish to participate in such a phony excuse for government, where money capital writes and enforces the rules ranging from sexual mores to the air we breathe. There are numerous and better options, and all involve an active engagement of the citizenry and a refusal to sell our public wealth and our futures as serfs serving a corporate culture.

 We should show corporate privatizers the gate and proceed to flesh out our own futures (financed in part by more equitable taxation rates – the latest outrage being that GE has paid an annualized rate of only 2.3% on its billions in profits over the last decade, a far less rate than many pay who are on food stamps)! Such disparities in financing America (among other things) must cease – now!  GERALD E

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RECESSION – BUT WHEN?

RECESSION – BUT WHEN?

I wrote in the spring of 2018 that we were headed for a recession that year or 2019 at the latest. I have been wrong before and hope I am wrong again, but with four and a half months to go in this year and (finally) inversion of the yield curve yesterday, a precursor of recession, I may, unfortunately, be right, or if wrong with a prediction of 2019, belatedly right for year 2020.

The usual response of tax cuts and increased spending to a recession threat has already been used up by Trump with his ill-advised giveaway of taxpayer money to those (including himself) who didn’t need it and who didn’t reinvest such undeserved trove in our economy. Investors are losing faith in the economy’s future and are not investing, resulting in flight from equities into gold and a bond market of drooping yields. Trump continues his inane trade wars, which via tariffs raise prices on American consumers of foreign products (notably Chinese), reduce our export trade due to counter tariffs, and has thrown thousands of American farmers into either bankruptcy or becoming welfare recipients, or in time, both. Germany, the economic engine of the EU, suffered negative growth last quarter, less than that of Italy, Europe’s laughingstock economy which registered zero growth, and will officially be in recession if the current quarter’s economic growth is again negative, and this as the world’s third biggest economy (behind only China and the USA) with trade surpluses year after year, a situation which (in our international economy), may tell us as much about the prospect of a coming recession as the violent contractions of our Dow, flights to bonds, and even yield curve inversions.

There is an international slowdown afoot. When car production, the number one export industry of Germany, falters, those in the supply chain of component parts from Poland, The Netherlands, and other supplying jurisdictions falter as well, just as Mexican suppliers of component parts for our automobile industry will. Unemployment becomes a contagion irrespective of territorial lines and thus, as in the 1930s, the coming downturn promises to be international in scope.

So let’s indulge in the political game of whom or what are to blame? Politicians point to Trump’s trade wars, Brexit, Iran, North Korea et al as the villains, but we have had villains of like ilk before during periods of relative prosperity. It may be that we and the world are simply adjusting our domestic markets to the new realities of easy movement of capital and labor across international boundaries and participation in other countries’ economies (and inevitably, their politics), accompanied by, as usual, terminal greed in such interchanges masquerading as policy.

My own guess as an amateur economist is that it is all of the above and more; more that we have not yet recognized as the international economy continues to take hold in a smaller and smaller world, a move never undertaken before and thus sans example, and while Trump’s infighting doesn’t help, I think the coming recession is one we would have had in his absence, though not as deep and long as it might have been had he controlled his narcissistic self in trying to demonstrate his brilliance in matters economic, a hopeless exercise. As to where we end up post-recession, I have no prognosis, and will adopt Trump’s frequent response to questions he can’t answer > We’ll see.        GERALD            E

THE BIG HEIST

THE BIG HEIST

Professor Kennedy in her blog today notes that the Trump-Ryan tax bill passed and signed in December, 2017, not only rewarded the rich and corporate class and added to our twin deficit(s) but also gave away some 40 billion dollars of our tax money to foreign investors (which hardly redounds to our economic growth), a secondary but significant chunk of your and my tax money which could have otherwise been applied to our costs for education, healthcare, both the current and long term deficits etc. I responded to her blog, somewhat off target and slightly edited, as follows.

I have written on this tax bill that rewarded Boeing, among others, for so long I am going to pass on general comment in re the further travesty of its rewards to foreigners, but today instead write about a specific taxpayer, a so-called “defense” (aka offense) contractor, to wit: Boeing (who Trump once said  in a speech before their executives >  “God bless Boeing”), a very profitable corporation which paid ZERO taxes last year on some 11 billion dollars in profit, but since Boeing and its executives and shareholders were foundering before that and on the edge of Chapters 11 and 7, respectively, (not), Trump and Ryan heaped billions of our tax money in tax cuts on their respective bottom lines in a massive giveaway of our tax money aggregating over a trillion and a half dollars that, when added to other such “defense” industries’ bottom lines and corporate welfare for their non-defense corporate brethren and rich people in general, makes the 40 billion given to alien investors look like chicken feed, and guess what? Our grandchildren will join us in paying for this heist (added to an already long term deficit of some 21 trillion dollars, both at interest.) Welcome to a record-shattering long term debt of 23 trillion dollars (to be paid at interest)! Thanks, Don.

It is unfortunate that Trump, Ryan and every senator and representative who voted for this December, 2017, theft cannot be indicted and jailed, but their predecessors in office have provided immunity for such acts of public larceny. The good news is that this as yet unaddressed felony can be reversed and that Warren, among others and if elected, has pledged to repeal this act. I can hope that such a repealer will include a tax increase aimed at those who benefited from this horrid legislation in the first place (and which includes, incidentally and personally, Trump, Ryan and McConnell themselves), and that such recoveries are returned to the public larder (our treasury) – with interest.

Parenthetically, this is the same Boeing (who gives us 737s that crash and kill people and jets that Saudis use to bomb Yemen), a sometimes taxpayer who Trump, Ryan and Mitch prefer to reward, and who now tell us that we will have to reduce social services to pay for their giveaways to the already filthy rich in yet another officially unaddressed theft to pay for the effects of the first one! What brass! GRRR!        GERALD          E

BRAINPOWER – FOREIGN & DOMESTIC #2

Mea culpa. In the first sentence of the blog I published just a short time ago as above named I wrote that half of our GDP was estimated to be attributable to innovation. That was a mistake. I should have written that an estimated half of our INCREASE in GDP was estimated to be attributable to innovation. (Silicon Valley hasn’t completely taken over, not yet.)         GERALD          E

BRAINPOWER – FOREIGN & DOMESTIC

Professor Kennedy in a recent blog pointed out that visa and immigration snafus provided by our politicians are having an adverse effect on our GDP, citing one authority to the effect that such loss of brainpower from afar and the innovation foreign PhDs provide to our Silicon Valleys where innovation may account for as much as half of our gross domestic product. If such an estimated drag on our economic growth or anything near it can be substantiated, then we do indeed have a new emergency to add to our current list of emergencies for solution by a brainless president and do nothing policymakers, who seem to be more interested in playing political games than governing.  I responded to her blog, slightly edited, as follows.

We are beginning to pay a price for our racism and failure to fund education. We have this international search for brainpower turned around. Student debt is also beginning to negatively affect GDP, new housing starts, population growth, middle aged stay-at-homes etc. etc. etc. We should be paying and otherwise subsidizing students to go to school, especially those with interests and abilities related to STEM disciplines, but humanities at well. We can grow our own brainpower for the Silicon Valleys in our country, and they won’t need visas, though we should keep robust visa programs intact, as will be suggested later herein.

On the negative side, what if we educate these PHDs and other such students with taxpayer dollars and some of them go to overseas Silicons due to our racism and Bronze Age (and now institutional) policies of wage and wealth inequality? We will still need enlightened visa rules and regulations to ensure that foreign PhDs who have perhaps been educated at their country’s expense or at their own can immigrate to our country to fill the void, if any.

Pipedream? Can’t be done? Can’t afford it etc. etc. etc.? That’s funny. We had a trillion and a half dollars of our and our grandchildren’s tax money to hand over to the already filthy rich and corporate class courtesy of Trump and Ryan recently and (per CBO) a first ever trillion dollar current budget deficit coming up and stretching out as far as the eye can see, a deficit to be added to our current long term deficit of some 23 trillion dollars, all at interest.

This giveaway by Trump and Ryan gives a big bump to our already wage and wealth inequality crisis – and what did We the People get for our money? Debt. What did the filthy rich and corporate class get? Big time dividends and capital gains opportunities for their executives and shareholders. Query > How many PhDs would a trillion and a half (and interest) have funded if such Trump-Ryan trove had not wound up in the Hamptons and/or Zurich and have instead been applied to a problem which may be responsible for a drag on as much as half of our economic growth as measured by our GDP? 500,000? Problem solved. Trouble is, politicians decide funding priorities, and tend to fund priorities that fund them.

Our policymakers have decided to reward the rich with a giveaway of our and our grandchildren’s tax money with no discernible advantage accruing to the rest of us. None. Apparently the plan is to let foreign countries pay for PhDs and import them into this country for our Silicons while poor-mouthing education and other important initiatives in favor of tax cuts for those who don’t need it. I object. Strenuously.      GERALD           E

TRUMP THE CAUSE

TRUMP THE CAUSE

Professor Kennedy, not unexpectedly, wrote a blog today on the weekend racist-inspired murders in El Paso and I’m angry murders in Dayton and what, if anything, we are going to do about it. I responded as one of many contributors with their varied commentaries as follows, slightly edited.

We know what happened, and we think, why, but what are we going to do about it? Well, Democrats have far more votes than Trump and his assorted wingnuts, so the answer to who occupies the bully pulpit beginning January 20, 2021 is to get our people off the couch in the fall of 2020. Other sub-answers include ending Republican voter suppression techniques either legislatively or judicially, or both, ending Russian and others’ interference in our elections, and (in the absence of federal legislation due to Mitch and others), coming up with state statutes dealing with White National and other bigoted violence calling for trips to state prisons, where such wannabe Nazis who employ force and threats will see how they fare in solitary with the force and threats with which their guards and other prisoners there are well acquainted.

Our democracy is teetering not due to the presence of white nationalism, racism and angry bigots who see their world in flux. That presence has been with us since before 1776, coming to a head in 1861 with the firing on Fort Sumter, and bubbling just below the surface ever since, but its “Fort Sumter lite” is showing up for real these days for one and only one reason, to wit: Such unresolved hatred has a spokesperson in the Oval Office. Trump is THE problem.

Thus (following prevention of violence) our number one problem is the removal of Trump from his position via impeachment and/or election, followed by his indictment and imprisonment thereafter for any number of crimes he has committed and is committing, including but not limited to incitement to riot. Afterwards, I think the nation needs to (finally) go to work in accommodating demographic realities by working on what will remain a bubbling resentment among some of our number with a view toward its actual eradication and (at last) achievement of peace in our time.       GERALD         E

EL PASO, DAYTON AND MOSCOW MITCH

EL PASO, DAYTON AND MOSCOW MITCH

Professor Kennedy in her blog today raises the issue once again of Moscow Mitch and his refusal to bring up House-passed legislation which would enhance gun safety and, as multiple studies have shown, greatly reduce the some 40,000 gun deaths we suffer each year, which for my money and albeit indirectly, makes Mitch a killer of far more than the total of those who were killed in El Paso and Dayton yesterday. My response, slightly edited, was as follows.

I first started my analysis with compliments for two of my fellow contributors today, Pete and Todd, as in “Good analyses today, ” and in response to Todd’s question as to whatever happened to the funneling of Russian money through the NRA to Trump’s campaign and  why we don’t hear anything about it anymore, I replied “Can you spell Bill Barr?”, noting in passing that it helps to have an AG who plays defense counsel for Trump thanks to a vote of the Republican Senate. Personally, I have been both prosecutor and defense counsel during my career, but never simultaneously, since such would have been at least a disbarment as well as a criminal offense.

I then continued my contribution for today as follows. The French have used general strikes very effectively since 1789 to reverse unpopular political decisions. No one shows up for work. I have in the past suggested that we should resort to a general strike to reverse some of Trump’s edicts, but with El Paso and Dayton such may be unnecessary since if the mass of people won’t leave home for fear of being shot we get the same result, and if sustained and the Dow goes south and the economy is on the verge of collapse, perhaps even the domestic terrorists currently running our country will relent for fear our economy and our democracy will implode before they can ruin them on their own terms.

Our task, now an existential one since shooting gallery politics and democracy are oil and water and we can envision the cliffs of coming failed state and/or third world status for our once great democracy, is to resist domestic terrorists both in office and in the streets ever more strongly than before – and without letup. Our most precious asset held in common, our democracy, depends upon it.        GERALD           E

OVER REGULATION AND UNDER REGULATION

Professor Kennedy recently blogged on the eternal issue of regulation of markets and industries, noting such is necessary especially in the interest of public safety. Thus we need regulation of such industries as Boeing (see their 737 wrecks), food inspection (see e coli and other food poisons) and other such markets where public health is involved. Regulation is also necessary in, for instance, the stock market, where fiduciary standards are absolutely necessary to its fraud-free functioning. Libertarians favor little to no regulation in the pursuit of profit in a wild west marketplace they have conjured even though one of their heroes, Adam Smith, would not agree. Professor Kennedy invites commentary and the following, slightly edited, was mine.

We rightly regulate business and other activities that can cause us harm, but in fits and pieces, depending upon the political climate of the day. Right now with Trump at the helm and with the libertarian and ALEC-supporting Kochs, expect less regulation (in return for bribes we choose to call “campaign contributions”) of activities that make more money for the already rich and less protection for the rest of us.

Business interests and their minions such as the WSJ have done a number on the rest of us by framing attempts to regulate their businesses as “anti-business,” job destructive etc., when such attempts are rather about public health, public safety etc. We pay for their costs of lobbying via increases in cost of goods and/or services, of course, and they deduct such costs from their taxes as “ordinary and necessary costs of doing business,” thus leaving us with a larger tax bill or deficit yet to pay via such economic externality.

The fact and truth of the matter is that as Silicon Valley and others give us more and more complicated matter, both tangible and non-tangible and some with unknown consequences, we will have to regulate such advances as they appear and will need more and more sophisticated regulation of such goods, services, processes and other intellectual property, all of which are prone to monopoly (see Big Tech). Future regulation of such increasingly complicated rights to property and processes will therefore likely involve brushes with the Sherman Act as well as the patent and copyright and other worlds of rules and regulation – and should be interesting.        GERALD          E