Economics, and Ecological Intelligence
An Earth Manifesto publication by Dr. Tiffany B. Twain
Eleven score and twenty years ago in the
year 1776 our forefathers declared independence from the British Empire and
brought forth upon this continent a new nation conceived in liberty and
dedicated to the proposition that all people are created equal in their natural
human rights. Now I imagine the entire
body politic gathered here together, one nation, supposedly indivisible and
committed to liberty and justice for all, and we are collectively pledging
allegiance to these great ideals in their essence. In curious contradiction, however, many
Americans are at angry loggerheads, and the interests of narrowly focused
groups are taking precedence over broader civic concerns. Most people are distinctly divided by stoked
conflicts and ideological differences and hyper-partisan politics, and our
society seems to be increasingly becoming characterized by growing extremes of
economic insecurity, social injustices and unfairness in political
representation. These developments are
taking place, not by mere coincidence in conjunction with a stunning increase
in the concentration of wealth in the hands of the richest 1% of
Americans. These pathetic happenstances
significantly undermine social cohesion and fair-mindedness and our democratic
form of governance, and they endanger the future well-being of the American
people and our children and grandchildren and all persons in generations to
A great battle
of ideas has been taking place in the world in the past century. Libertarians, conservatives and market
fundamentalists stubbornly maintain that the best plan for every country is to
adhere to strict principles of private enterprise, and to make government rules
as favorable to powerful private interest groups as possible while minimizing
collective bargaining rights of workers and environmental protections. The top goal of these folks is to gain
domineering power by pandering to the desires of rich people to pay the minimum
amount of tax, and one of the main means to accomplish this goal is by giving
corporations more influence and trying to make sure that workers do not have
much power in negotiations. By staunchly
supporting objectives like this, these myopic partisans are basically
rationalizing inequalities, inequities, injustices, heightened social stresses
and the unwise and excessive exploitation and degradation of natural
ecosystems. One unspoken goal of these
ideologically motivated individuals is to help ensure that the richest 1% of
the people continue forevermore to own more wealth than almost 90% of the
Americans on the bottom rungs of the economic ladder.
the 400 richest families in the USA today have more wealth than the bottom 180
million people combined. And many of
these rich people demonstrate a brazen eagerness to utilize their accumulated
riches to corruptly influence our representatives to get them to commit to
purity pledges in which they swear never ever to dare impose any higher levels
of tax on earnings, investment income, capital gains or inheritances. The problem with this severely skewed state
of affairs is that there is far-reaching truth in this observation made by Louis Brandeis, a Supreme Court Justice from 1916
have democracy in this country, or we can have great wealth concentrated in the
of a few, but we can’t have both.”
Which shall we choose?
In the highly regarded tome Capital
in the Twenty-First Century, French economist Thomas Piketty skewers
assumptions about a supposed invisible hand of benevolence in advanced
capitalist economies, and he “forecasts sharply increasing inequality of wealth
in industrialized countries, with deep and deleterious impacts on democratic
values of justice and fairness.”
changes, says Piketty, wealthy individuals will keep getting wealthier, and
they will do so at an accelerating rate.
He describes this prospect as “terrifying”, for a variety of convincing
reasons. Thomas Piketty not only
poignantly analyzes problems related to global capitalism in this book, but he
also prescribes creative solutions for the inequality problem, like a “global
wealth tax.” More about this intriguing
A Mini-Me Makes a Persuasive
aspect of the important documentary film Inequality
for All is the outsized larger-than-life mini-me character of Robert Reich
and the personal motives he expresses that have inspired him to champion
greater economic justice in the world.
Robert Reich was always very short, due to a rare genetic condition, so
bullies in school tended to pick on him.
He found it expedient and more secure to affiliate himself with older
boys who commanded more respect, and that is how he made friends with a young
man named Mickey Schwerner who cared about social justice so much that some
years later he ventured to the Deep South to help black people exercise their
right to vote freely during the “Freedom Summer” of 1964. Tragically, this friend and protector
disappeared in Mississippi for several months and then was found dead, murdered
by racist members of the white supremacist Ku Klux Klan for his honorable
concern. No culprits have ever been
As a result of
his personal circumstances, Reich relates, he has always been acutely sensitive
to injustices in the world, and to the bullying of the working class by those
who insistently proclaim their all-but-divine right to riches, status, power,
privileges, maximized corporate profits, and very low rates of tax on their
incomes and capital gains. Bob cites the murder of his friend as an
inspiration to "fight the bullies, to protect the powerless, and to make
sure that the people without a voice have a voice." This is a truly commendable life purpose!
The USA was
founded by people who loved liberty, and who hated bullying despotic abuses of
power, so it is surprising that the richest 1% of Americans have succeeded so
blatantly today in buying enough influence in the Senate and House of
Representatives -- and on the Supreme Court -- to corrupt our national purposes
into a repetitiously ideological and weakly rationalized protectorate of greedy
privilege. An expansive examination of
this theme pervades the ideas that unfold in this essay.
“There are more
things in heaven and earth, Horatio, than are dreamed of in our philosophy.”
--- William Shakespeare, Hamlet
Economics, is the True Morality Play
like to see economics as a morality play, and in particular as a tale of excess
and sin, and of deserved punishment as a consequence. “We lived beyond our means, the story goes,
and now we’re paying the inevitable price,” wrote the distinguished American
economist Paul Krugman. “Economists can
explain ad nauseam that this is wrong, that the reason we have mass
unemployment isn’t that we spent too much in the past but that we’re spending
too little now, and that this problem can and should be solved. No matter; many people have a visceral sense
that we have sinned and must seek redemption through suffering -- and neither
economic argument nor the observation that the
people now suffering aren’t at all the same people who sinned during the bubble
years makes much of a dent.”
made this cogent point in April 2013 in a good New York Times Op-Ed column
titled The 1 Percent’s Solution. He added that there is nothing about the
fact that bankers made bad loans in 2005 that made it sensible to have had
historically high levels of unemployment and underemployment for ordinary
workers for many years thereafter. He
expresses a strong conviction that the profession of economics should not be a
sermon, but just a job, and the task in this important job is to figure out how
to fix the economy for the benefit of the majority of people and the greater
makes it clear in his latest book Saving
Capitalism: For the Many, Not the Few exactly how our current system is
rigged to benefit the Citizens United-emboldened
few. And he makes excellent points and
proposals that indeed would most likely launch us on our way to smarter
solutions to the many dilemmas we face.
While it can be deceptive to portray economic
activities as a morality play in an absolutist judgmental way, there is a
contrasting sense in which work activities really can be accurately regarded as
a morality play. The judgment in this
drama is clear: the 1% of people who
largely control the economic system are emulating bad guys who almost personify
evil in a Manichean vision of black-or-white judgmentality. If you ever hear business executives or
religious fundamentalists using the word lazy
when they are talking about working people, snap to attention! There's something happening here, and what it is ain't exactly UNCLEAR. In the song For What It’s Worth, Buffalo Springfield recommended:
“It's time we stop, hey,
what's that sound
Everybody look what's going down.”
conservatives advocate austerity policies for the masses, and the fact of the
matter is that the agenda of these folks looks a lot like a simple expression
of the preferences and demands of wealthy people. This agenda is shrewdly sugarcoated in a
facade of supposed academic rigor. “What
the top 1% wants becomes what economic science says we must do.” And “it’s not just a matter of emotion versus
logic. You can’t understand the
influence of austerity doctrine without talking about class and inequality.”
In the film Inequality for All,
Professor Reich exposes the deep inequities and adverse effects of rising
economic inequality in the United States.
He makes it crystal clear that wages for the middle class have dropped since 2009 while the top 1% of people have reaped 95% of the gains made in the economic recovery.
Professor Reich expresses heartening optimism that, by working together,
Americans can change this undesirable dynamic.
Progress has eventually gained sway throughout our nation’s vaunted
history, despite occasional periods of retrograde trends, and Bob Reich
believes the turning point is soon approaching that these inegalitarian trends
will be reversed. The American people
succeeded in gaining a fairer bargain and broader prosperity between the
Depression of the 1930s and 1980, so we sure could do it again today!
Emmanuel Saez, a French economist and Professor of Economics at
UC Berkeley, has confirmed this fact
that the richest 1% of Americans have made almost all the gains in the economic
recovery since 2009, and that middle class
wages have fallen in real terms (after inflation is taken into account). Inequality of this magnitude is “poisoning our society and making a
mockery of the American dream of equal opportunity.” Professor Saez recommends that much higher taxes be implemented on
the individuals earning the highest income, with marginal federal tax rates on
the highest levels of income of at least 70%.
Yep, that is the same level they were before Ronald Reagan began
reducing them to a sensational low level of only 28% during his two terms in
Economic strategies that would help
create good jobs and more widespread prosperity would be much better than
current strategies that have been designed mainly to increase corporate profits
and stock prices. These more
providential plans include improving our current educational system to make it
more affordable and more accountable for improved outcomes; creating powerful incentives for corporations
to keep jobs at home rather than offshore them to other lower cost
countries; increasing the minimum wage
so that families can live on pay they receive;
eliminating payroll taxes on the first $15,000 of income for every
taxpayer; raising the cap on income
subject to payroll taxes; giving workers
more collective bargaining power;
creating greater systemic safety in our economic system; and moderating risks and costs of bailouts by
reducing the multiples of leverage allowed to banks, and by mandating higher
levels of capital equity.
Extreme levels of
income inequality represent a new “inconvenient truth”, to borrow the phrase Al
Gore used about the dangers of a warming planet. This inconvenient truth reveals the dark side
of unfairness in our econopolitical system and its negative impacts on poor
people and the middle class.
obstacle towers above all others in preventing us from taking positive steps to
remedy the serious socioeconomic and environmental problems that confront
us. This hurdle is the staunch
resistance of the political duopoly
that strives to monopolize our economy and politics.
This is the
conclusion reached by Charles Ferguson, who directed the compelling documentary
film Inside Job about the financial
crisis that began in 2008. Ferguson is
also the author of the sensational story told in Predator Nation: Corporate Criminals, Political Corruption,
and the Hijacking of America. Ferguson gradually arrived at
an understanding that one fundamental structural problem in American politics
are at the root of many of the most dangerous problems in the world today. He calls this political duopoly “a remarkable
system for remaining in power”, a system that both Republican and Democratic
politicians have perfected to maintain their power. By doing so, this establishment mainly serves
America’s plutocratic oligarchy, i.e. today’s rule by the wealthy few.
being in an era of brutal partisan warfare, as conventional wisdom holds -- and
as watching the nightly television news might suggest -- the U.S. is now in the
grip of a political duopoly in which
both parties are thoroughly complicit.
They play a game: they agree to fight viciously over certain things to
retain the allegiance of their respective bases, while agreeing not to fight
about anything that seriously endangers the privileges of America’s new
attention to these insightful words in Charles Ferguson’s provocative book Predator Nation:
experienced a profound realignment of its politics over the last generation,
driven by a combination of globalization, American economic decline, and the
rising use of money to shape American politics and government policy. The core of this realignment is that the two
political parties now compete for money, while colluding to hide this
fact. They provide the appearance, and
often the reality, of fierce partisan conflict on social and ‘values’ issues,
whereas on the issues of critical concern to the financial sector and America’s
economic oligarchy, their actions are almost identical. We have, in short, a political duopoly -- a cartel formed by the two parties that,
between them, control all of American politics.”
glance, the suggestion that both parties are colluding and under the influence
of a single oligarchy seems absurd.
There are red states and blue states, and the two parties are viciously
polarized. And there is real political
conflict in America, especially on social issues that matter to the two
parties’ bases -- abortion, gay marriage, sex education versus religion in
schools, creationism and evolution, guaranteed-health-insurance-as-socialism,
taxes-and-government-as-evil, gun control, welfare, drug policy, immigration,
environmental policy and the reality of global warming. These are very real, very important
issues; and on these issues, each political
party can credibly tell its base that defeat would mean real, painful losses.”
“But that is exactly the point. It’s a
brilliant strategy. These social and
‘values’ conflicts serve excellently to divide and distract people who should,
and perhaps otherwise would, be
dangerously united in feeling that they were being raped by their CEOs, their
bankers, their elected leaders, and the political establishment. Thus, each party can continue to command the
grudging support of people who fear that if the other side won, they would lose
something important, which leaves the two parties free to collude on the most
important thing to both of them -- money.” …
duopoly will endure, and what to do about it, are perhaps the most important
questions facing Americans. The current
arrangement all but guarantees the continuing decline of the United States as a
nation, and of the welfare of the bottom 90% of its citizens.” …
Americans no doubt still believe in the American dream. One wonders how long they can maintain that
illusion, for America is transforming itself into one of the most unfair, most
rigid, and least socially mobile of the industrialized countries. … No other
developed country, even class-conscious Britain, comes remotely close to the
extreme income and wealth inequalities of the United States in 2012. … The flip
side of the growth in American inequality is an obscene, morally indefensible
decline in the fairness of American society -- in education, job opportunities,
income, wealth, and even health and life expectancy.”
I believe we
have a definite moral obligation to take honest and courageous action to remedy
this state of affairs. The urgency of
the need to positively change the most egregious aspects of the status quo
motivates the lines of thinking that follow.
presidential primary elections unfolded in an eminently revealing way. The majority of Americans are revolutionarily
unhappy with the establishment, rating politicians in Congress with about the
lowest level of approval ever in U.S. history.
As a result, voters have given surprisingly strong support to Bernie
Sanders, who calls for really revolutionary changes in our economic and
political systems, and to Donald Trump and Ted Cruz, who have deleteriously
exploited people’s frustrations, anger, fears and prejudices in an attempt to
gain power. Conservative factions were
actually brazen enough to promise to double down on misbegotten “trickle down”
tax cuts, and thus perpetuate the broken system that is wreaking so many
hardships on working people and the average American. Much more on Trumpism later in this essay.
Ecological Economists to
A scientific and philosophical discipline
called ‘ecological economics’ has been in the process of being articulated in
the past three decades. Ecological
economics is guided by the need for humanity to find ways to live sustainably
and to leave a fairer legacy to future generations. This discipline is concerned with the
carrying capacity of natural ecosystems and the conservation of resources and
the true implications of environmental damages caused by human activities.
Ecological economists recognize a broad
range of unintended consequences of human actions. They point out the wisdom of honestly taking
into account these bigger-picture perspectives in all public policy decisions. They question economic ideologies that
advocate a gospel of stimulated consumer indulgences, recklessly wasteful
growth, less regulated cutthroat capitalism, and national policies that will
exacerbate the risks engendered by growing social inequalities. Ecological economists contend that it is
foolish to measure economic activities in distorted and misleading ways, and to
make dubious assumptions in analyses of costs and benefits of public
policies. And they strive to advance
ideas that are consistent with values that really represent the greater good.
Ecological economists emphasize the vital
importance of natural capital and the incalculably valuable “ecosystem
services” that are provided by a healthy biosphere. It makes much more sense to give serious
consideration to these underpinnings of more expansive well-being than to
mindlessly ignore them -- or to adamantly deny them. We simply must begin to recognize the hidden
costs associated with courses of action that recklessly deplete resources and
cause irreversible harm to habitats and ecosystems and the global climate.
One of the cautionary lessons of history is
that an economic collapse is often the end-game result of unchecked growth and
a disregard for the foundations of well-being.
Our societies cannot ignore with impunity ecological damages and the
heedless over-exploitation of resources.
The ancient civilization on Easter Island in the remote reaches of the
South Pacific collapsed because the native Rapanui people apparently failed to
see limits on the amount of arable farmland, native palm forests and fresh
water on their small island, even as they depleted these vital resources and
their population grew beyond sustainable levels. The relics of their famous monumental
volcanic stone statues stand in mute testament to their ancestor worship and
God-like regard of chieftains and elites, and the eventual folly of their ways.
Potential economic catastrophes pose risks
much too serious to ignore. When people
pay too little heed to long-term considerations today, such shortsightedness
creates an increasing likelihood of terrible hardships for billions of people
in coming years. During economic boom
times, people tend to develop “disaster myopia” and ignore the real likelihood
of what things could actually go wrong, and they tend to forget the vital
importance of sensibly adhering to precautionary principles.
Excessive damages to the crucially
important environmental commons could be catastrophic for humanity, and such
harms could be practically irreversible on any meaningful time scale. This is why ecological economists tell us we
would be wise to take precautionary measures into account in our public policy
approaches. It is also why they advise
us to make smarter investments in more fair-minded plans, and in economic
activities that will prove to be sustainable over the long run.
Most people want something for nothing, so
they do not support rules that require us “to pay as we go”. Our representatives in Congress consequently
resort to the risk-laden expediency of borrowing huge sums of money from people
in the future to finance the demands of vested interest groups and the dictates
of short-term-oriented goals. This
myopic strategy consequentially threatens to make a wide variety of negative
impacts worse, portending one sadly salient aspect of our legacy to our
It would be smart for us to embrace
ecological economics as the mainstream of our understandings of economic
development. The short-term orientation
of other economic ideologies is proving to be far too destructive and
unsustainable. It is time that we make a
much clearer distinction between the mere quantity of growth we can
achieve and the contrasting factors that contribute to real improvements in the
quality of life. The overall
quality of life, after all, is assuredly more important by all meaningful
Efficient allocations of resources cannot
be considered alone without assessing the fairest and best uses of resources,
or the sustainability of our activities.
We can no longer continue to ignore carrying capacity limitations
inherent in natural ecosystems. The
overarching value of healthy habitats and intact ecosystems and adequately
protected biological diversity of life on Earth should be recognized and
respected. The full range of problems
created by industrial agriculture should be taken into account, and we should
also be honest with ourselves about the ramifications of egregiously wasteful
and polluting uses of fossil fuels and the huge subsidies that are given every
year to related industries in countries worldwide.
We should also seek ways to give stronger
protections to critically important rainforests and temperate forests, and
wetlands and estuaries and coral reef communities and ocean fisheries. Surely it would be wise to strive to prevent
further declines in wild fisheries and nursery habitats. The problems associated with impending fresh
water shortages should be boldly and comprehensively addressed. And courageous actions must be taken to
prevent further disruptions of global weather patterns that are being caused by
our improvident propensities to wantonly spew tens of billions of tons of
greenhouse gases into the atmosphere every year.
The gap in fortunes and privileges between
the super-rich and all other Americans has been radically widening in the past
35 years. Economic inequities, as a
result, have become almost as extreme as they were in Mark Twain’s days. In The
Gilded Age: A Tale of Today, Mark Twain wrote about a phony patina of
prosperity that materialized during an era in the late 19th century when
conspicuous consumption by the wealthy was glaringly gaudy. At the time, there was widespread corporate
and political corruption and many abuses of power by “robber barons”. In that era of industrialization, workplaces
were unsafe, many products were dangerous, wages were low, child labor was
pervasive, numerous violent assaults took place against worker organizations,
and there were widespread discriminatory practices against women and people in
racial minorities. In addition,
corporate entities were often engaged in monopoly practices that made
competition unfair, wasted resources, harmed competitors and consumers,
polluted the commons and damaged the environment.
Mark Twain decried rapid increases in
economic inequality during the Gilded Age.
Historian Vernon Louis Parrington later called the period “the Great
Barbecue", ostensibly because many of the eminent people at the time were
figuratively roasting the country to amass huge amounts of wealth and to enjoy
special banquets and benefits and privileges exclusively for themselves. A narrow concentration of income and wealth
developed in those days, as it has again today.
This deep inequity eventually sparked a powerful reaction in a
far-reaching Progressive Era reform movement that flourished from the 1890s to
about 1912. Then an economic boom took
place after World War I, during the Roaring Twenties, which rudely culminated
in a crash of wild speculation in the stock market in 1929, and the harsh
Depression of the 1930s began. This
economic crisis stoked massive social unrest, and it forced the financial and
political elites to agree to a fairer deal in which the concentration of
income and wealth was reduced for the ensuing 45 years, and the middle class
was strengthened, and America was made truly fairer.
the elites were forced by these developments in our democracy to agree
to a fairer deal. Today? “Damn the masses!” Wait a minute -- can't 99% of the people
prevail and require rich people to pony up a fairer contribution to social
insurance policies that will actually serve not only to make the average person
more secure but will also help protect plenty of the privileges of the rich?
Today the richest Americans are once again
abusing their power in astonishingly effective ways. They are doing so by tirelessly working to
subvert fairly representative decision-making, and by making sure they
continuously increase their relative advantages over all others. CEOs, Wall Street fat cats, lobbyists and our
political representatives are lavishly entertaining themselves with sumptuous
banquets, often at the public’s expense.
They jealously rationalize their good fortune by ruthlessly promoting
disingenuous and misleading and often patently false ideological
arguments. They abuse power by
rigorously controlling wages paid to workers, increasing the prerogatives of
corporate entities, and collaborating together to pay low rates of tax at the
expense of young people and future generations.
Inequalities and inequities are widening
between people in many arenas, including in opportunities available, income
earned, tax rates paid, wealth accumulated, and overall privileges
enjoyed. These trends are creating grave
risks to our national solvency and our econopolitical system, and also a wide
range of dangers to our collective well-being.
The hallowed idea of government of the
people, by the people, and for the people is being perverted into government of
corporate interests, by corporate interests, and for rich people. This betrayal of our national ideals is
simply unethical and wrong. It is a
perfidiousness subversion of our democracy that is being perpetrated by a small
set of ideologically uncompromising and greed-driven wealthy people who are
betraying the public trust. They are
succeeding in this swindle by rigging the system for their own narrow benefit
and striving mercilessly to exploit natural resources and diminish the power of
working people. In demanding both
historically low tax rates for themselves and austerity for the masses, they
are contributing to huge budget deficits and powerful pressure for cuts in
funding to vital things like public education, national infrastructure, cleaner
renewable energy, innovative research and development, family planning
programs, and protections of wildlife, endangered species, public lands and the
obviously change the distribution of income, as they have dramatically since
Ronald Reagan began gutting progressive tax policies by slashing marginal tax
rates on the highest income earners from 70% to 28% in the 1980s. Less obviously, but possibly with even more
influence, are government policies that have enormous effects on the
distribution of income before taxes
or government benefits are taken into account.
Public policies establish “the rules of the game”, so they have
determinative effects by means of establishing laws affecting corporate
governance, patents, copyrights, securities, contracts, international trade,
labor rules, minimum wages and regulations relating to financial markets and
high-risk ventures and the capitalization of banks. A wide variety of exceptionally special deals
are given to powerful vested interest groups, and the Federal Reserve pursues
policies that lopsidedly aid and abet the outsized growth in rich people’s
This is how
government entities, and thus politicians, have had a very big role in making
America into a winner-take-all society in the past 35 years. As inequalities increase to extreme levels in
our country, people’s attention is diverted from the real big long-term
problems that are insidiously festering in the world. Unless we admit this reality and take bold
steps to prevent looming economic calamities and ecological disasters, Nero’s
fiddling while Rome burned will appear like an episode of zoning out
introspectively by a mere bonfire compared to being baked by a coming worldwide
By collectively allowing this abuse of
power to persist, we are undermining vital ecosystems and thus unconscionably
cheating people in future generations.
Even the Vatican has called for an overhaul of economic systems in the
world. The Catholic Church has expressed
concern about economic instability and trends toward ever-widening inequality
of income and wealth between people in nations around the globe. These issues transcend the ability of
governments everywhere to effectively address them. The Vatican stated in October 2011 that new
international institutions are needed that are capable of helping solve these
issues, “now that vital goods shared by the entire human family are at stake,
goods which the individual states cannot promote and protect by themselves.”
In December 2013,
Pope Francis castigated certain elements of modern capitalist systems and
decried the "idolatry of money".
He asserted that these things were leading to “a new tyranny” in the
world. The perversely entertaining
right-wing radio personality Rush Limbaugh was enraged at the Pope’s words,
calling the Pope's ideas "pure Marxism." Ha!
Jesus was then the first Marxist?
Wealthy partisans have ironically taken
advantage of religious conservatives to get the system rigged to their benefit,
ignoring the fact that religion appeals to the downtrodden, and that Jesus told
the multitudes that rich people won’t have a chance in hell of getting into
heaven if they treat poor people in rudely obtuse and uncompassionate ways. Perhaps I exaggerate? Here is what the Bible says:
“Again I tell you, it is easier for a camel to go through the eye of a
needle than for a rich person
the kingdom of God.”
--- Matthew 19:24
In any case, great economic thinkers weigh
in below, and their perspectives are synthesized with those of arcane but
insightful economic theorists like Hyman Minsky and Arthur Cecil Pigou.
Important Big Picture ideas are also explored that relate to democracy,
capitalism, socialism, taxation, the financing of government activities,
deficit spending, proper accounting, common sense incentives and disincentives,
and systemic corrupting influences. And
recommendations are provided for smarter plans to really improve our
Introspection into Rational Rationality
Our decision-making about the best courses
of action to pursue is dominated by a condition known as “rational
irrationality”. This is the unfortunate
situation where rational actions, from points of view of individual choices,
lead to outcomes in aggregate that are irrational. As Garrett Hardin almost poetically opined in
his 1968 article, The Tragedy of the
Commons, “Ruin is the destination toward which all men rush, each pursuing
his own best interest in a society that believes in the freedom of the
true tragedy of the commons is that intently-focused laissez-faire capitalist
interest groups are driven to exploit the commons, damaging and depleting them,
while all other people involved are much less focused on ensuring that commons
areas are adequately protected and best managed for the longer-term greater
good. Additionally, perverse allowances
are too often put in place that encourage the unsustainable exploitation of the
commons, and it would be like unilateral disarmament in a war to cease this
exploitation. The rules of the game
simply must be changed, as has been providentially done with “catch shares” in
fisheries, so that everyone benefits in the long run.
by economists and politicians powerfully affect people’s lives and our
societies. Good ideas are becoming ever
more urgently important in our world, beset as it is by financial crises,
episodes of high unemployment, chronic underemployment, record numbers of
Americans living in poverty, growing inequities, surges of refuges, a
continuing rapid growth in global human numbers, and economic activities that
deplete resources, damage ecosystems, and contribute to the disruption of
normal patterns of storms, precipitation and temperatures. Bad ideas, and ones that are misguided and
inflexibly applied, can lead to disastrous consequences.
The bottom line
is that a civilizing sense of social cohesion requires us to manage our
societies more fairly and more intelligently.
This is the secret! The Common Sense Revival and the ideas in
Part Four of the online Earth Manifesto contain numerous specific ideas on how
humanity should be improving our societies and heeding ecological
understandings and coping effectively with the valid concerns of ecological
economists and other visionary thinkers.
Check out these compendiums of good ideas!
Meaning behind our National Motto
Perhaps we might
meditate for a moment on our national motto -- until 1956 -- E Pluribus Unum, or “Out of Many, One.” I feel strongly that everyone in our country
would find it advantageous if we all worked together to find better ways to
resolve the serious problems we face. It
is a sad fact that our national motto was changed in 1956 to In God We Trust. This motto carries a much different message
than “Out of Many, One.” The change
makes it seem as though we value disunity and discord more than unity in our
nation today. Yet it has been recognized
since the days Aesop, the ancient Greek story teller, that “United we stand,
divided we fall.” Uncompromising partisanship and ideological
extreme conservatism are likely to augur poorly for the future well-being of
Notably, God is proving
to be untrustworthy to keep peace between the faithful of various religions, or
between nations. It is curious that this
change in our national motto took place just two years after the phrase “under
God” was added to America’s oft-recited Pledge of Allegiance. This change was made in reaction to perceived
menaces of “godless Communism”, but it unfortunately also signaled a turning
away from our founding roots in religious tolerance and the separation of
church and state. The Religious Right in
the past 50 years has been acting as though it can provide a tautological proof
that our Founders were Christians who believed that their particular
obedience-demanding Almighty God is meant to rule supreme, and that ‘He’ is a
If we really want liberty and justice for all, we need our
leaders in Congress to represent the greater interests of all Americans, not
just moneyed interests who corrupt our politics and public policy
decision-making by giving politicians big bucks to finance their election and
reelection campaigns. Moneyed interests
generally have very narrowly self-interested agendas, and they demand high-end
tax cuts, more corporate perks and subsidies, less collective bargaining power
for workers, and increased private profits by being allowed to continue to
foist costs onto society. They also tend
to want less public-interest regulation and oversight, fewer requirements for
accountability, and no limits on campaign finance contributions, so that they
can continue to jerry-rig the system even more outrageously in their favor. I believe that the purpose of seeking
“liberty and justice for all” would be much better guidance!
“My role in society, or any artist’s or poet’s
Is to try
and express what we all feel.
tell people how to feel.
a preacher, not as a leader, but as a reflection of us all.”
--- John Lennon (1940 – 1980)
What Form of
Governance Would Be Best?
No nation has
ever actually tried libertarian rule, probably proving that societies need
regulations and rules of law and adequate revenues and a reasonably balanced
role for government to ensure the greatest public good. Germany, Japan and many other countries tried
fascist governance in the past century, featuring authoritarian rule and close
government ties to financiers and industry, but this mode of rule was clearly
disastrous and reprehensible because it generally involved opprobrious and
often horrific repression and tragic wars of aggression and tens of millions of
Union, China and many other countries have tried communistic governance, but it
turns out that planned economies allocate resources according to dictates that
do not fairly reflect supply and demand, so they tend to be inefficient,
bureaucratic, inadequately flexible, and poorly capable of competing with
capitalist economies. Market sensitive
economic systems that are relatively competitive have demonstrated a definite ability
to outcompete centrally planned ones.
That’s one reason that communist China has unleashed its billionaires
and huge population on cutthroat competition, capitalist-style.
The Soviet Union
made a heroic effort to compete militarily with the U.S. during the Cold War,
and it kept up well enough to contribute to the endangerment of the world a
hundred times over with its nuclear weapons and mutually assured destruction
(MAD!) geopolitics. To accomplish this,
the Soviet Union had to skimp on things like education, national infrastructure
and social safety net measures. This
caused the Russian people a wide variety of terrible privations, and even worse
ones when their system eventually collapsed and their Union fell apart. Some Russians are really, really rich these
days, but their fragmented union is still much worse for its costly Cold War
emphasis on militarism.
economies are quite effective in utilizing people’s self-oriented motivations,
the best plan generally involves encouraging responsible “free market” policies
and making smart use of market forces to achieve common good objectives.
economies are afflicted with their own serious shortcomings. For one, demand is artificially stimulated
through aggressive advertising and promotion, so people’s desires are skewed
into a grotesque caricature of sensible consumption and resource usages. Allocations of resources are distorted
because materialistic consumerism is stimulated to the detriment of
conservation and moderate resource usages and more spiritually enlightened
purposes for living.
Another cause of
failure of capitalist systems is found in periodic economic slumps, recessions
and depressions that are associated with bubble economic policies. These economic disasters harm millions of
people and leave large numbers of people destitute or unemployed for long
periods of time. The overwhelming
influence of the profit-prepossessed military-industrial complex also
significantly distorts our national priorities.
There are always
economic trade-offs and unintended consequences in all policy decisions. These and many other issues are explored
A Declaration of
naturalist John Muir, inspired by Alexander von Humboldt, once said that when
you tug at any single thing in nature, you find it attached to the rest of the
world. Filmmaker Tiffany Shlain and the
Moxie Institute have elaborated on this idea in the excellent film, Connected: An
Autobiography About Love, Death, & Technology. Watch this film
to get a good idea about its biographical perspectives on the great philosophic
physician, Dr. Leonard Shlain, whose four books I admire deeply. The film is available on Netflix.
Here is an entertainingly apt description of
Tiffany Shlain by newspaper
columnist Leah Garchik:
Filmmaker-philosopher Tiffany Shlain, whose work reflects a
“Poor Richard’s Almanac” sensibility -- here’s a good way to live your life …
is a dazzling blonde in a fedora, with assertive lipstick.
With that image in your mind, consider that
Tiffany Shlain has also created a film series that advocates positive global
change. The first film in the series
expanded on the last line of Connected: “For centuries we’ve declared our
independence. Perhaps it’s now time
we declare our interdependence.”
The Moxie Institute created a Declaration of Interdependence to give
people pause to realize how very important it is to recognize our
interdependence with each other and with the healthy ecosystems that are the
foundations of well-being. These tenets
are vital for creating a better future.
I recommend that everyone watch the Cloud Film Declaration of Interdependence. Let
Contemplate the ideas in the script of this
A DECLARATION of INTERDEPENDENCE
When in the course
of human events, it becomes increasingly necessary to recognize the fundamental
qualities that connect us,
Then we must
reevaluate the truths we hold to be self-evident:
That all humans are
created equal and all are connected.
That we share the
pursuits of life, liberty, happiness, food, water, shelter, safety, education,
justice, and hopes for a better future.
That our collective
knowledge, economy, technology, and environment are fundamentally
That what will
propel us forward as a species is our curiosity, our ability to forgive, our
ability to appreciate, our courage, and our desire to connect …
That these things
we share will ultimately help us evolve to our fullest common potential.
And whereas we
should take our problems seriously, we should never take ourselves too
thing that connects us ... is our ability to laugh ... and our attempt to learn
from our mistakes.
So that we can
learn from the past, understand our place in the world, and use our collective
knowledge to create a better future.
We can make the
future whatever we want it to be.
So perhaps it’s
time that we, as a species, who love to laugh, ask questions, and connect ...
do something radical and true.
For centuries, we have declared
independence. Perhaps it’s now time that
we, as humans, declare our interdependence!
Why Win-Win Philosophies
Are Better than Win-Lose Ones or Lose-Lose Ones
It is easy to overlook
the extent to which in-group cooperation was a crucial part of survival for
clans of our ancestors throughout the long evolutionary history of our
kind. It is true that our instincts
evolved in situations involving stiff competition for food and the best mates,
but our instincts also evolved in contexts of competition between social groups.
Natural selection favored groups that worked together for the greater
good of their group as a whole.
Behaviors that involved cooperation within clan groups and between males
and females were integral aspects of our survival and prospering as social
It is provocative to consider
the insightful realization of the famous psychotherapist Sigmund Freud about
our deepest motives: “It is impossible
to overlook the extent to which civilization is built upon a renunciation of
instinct.” He was talking about the
renunciation of aggression, selfish greed, and promiscuous sexual instincts,
not the more collaborative impulses that are explored in modern day books like
Steven Pinker’s The Better Angels of Our
Nature. Ironically, Sigmund Freud
had developed theories about repressed sexual drives in our unconscious minds,
and yet he indulged in a very close long-term relationship and possible sexual
affair with Minna Bernays, his wife’s younger sister. “Nice going, Dr. Freud! Shouldn’t you have been more virtuous in
sublimating those impulses?!”
Human societies have
gone through a civilizing process over the millennia as human numbers have
increased. Many growing pains have been
associated with the hundreds of millions of people who have moved from rural environments
to urban ones. The civilizing process
has involved a gradual inhibiting of people’s anti-social impulses, and has
featured the development of more keen abilities to anticipate longer-term
consequences of actions. In addition,
civilizing processes have involved growing empathic sensitivity and willingness
to take into consideration other people’s thoughts, feelings, perspectives and
As societies grow more
civilized, people coexist with each other through an improving degree of
self-control, empathy and mutual respect.
These qualities are born of Golden Rule considerations, and not merely
through fear of punishment by authorities or deities. Civilizing influences include the control of
appetites and the curbing of extreme emotions, and the transcending of violent
impulses. People become more and more
civilized when they are willing to delay gratification to achieve more
important goals and give greater consideration to the sensibilities and natural
rights of others. As civilizations grew
and developed, so did an awareness of cultural guidelines of moral conduct and
hygiene and “campfire etiquette” and the propitious value of live-and-let-live
attitudes. A recognition also came about
that it was socially desirable to avoid rashly unhinged inhibitions and episodes
of dangerous emotional hijackings and concomitant strife and violence. In a well-regulated society, no one would be
able to purchase any assault weapons without a background check to find out
about their mental health history or possible terrorist leanings.
Freud observed in his seminal work Civilization
and Its Discontents that the fundamental tension between civilized society
and individuals stems from the individual's quest for freedom and the contrary
demands of civilization for people to conform, to repress instinctual drives,
and to avoid harms to the well-being of human communities and common resources.
are promoted by public policies such as the reasonable governance of a nation
by means of a system of fairly formulated laws.
Also, there is a mutual utility involved in fair trade and commerce
between people that has made these activities largely positive influences that
have contributed for centuries to making our societies less cruel, barbaric and
violent. The result of all these
civilizing influences, according to Steven Pinker, was a curious outcome: “A culture of honor -- the readiness
to take revenge -- gave way to a culture of dignity -- the readiness to
control one’s emotions.” Hallelujah!
International trade has been a broad
civilizing force, but it
can have retrograde impacts when gigantic self-interested corporations abuse
their influence to enact provisions of trade agreements to the detriment of the
majority of people. When
trade agreements are written with too much input from excessively
profit-prepossessed corporate entities, some of the provisions may turn out to
be gravely unfair and socially undesirable.
Agreements like the North American Free Trade Agreement and the proposed
Trans-Pacific Partnership can lead to severe inequities, worker dislocations,
and tragedies of the environmental commons.
One glaringly absurd example of such a provision is an “investor-state dispute settlement”
system that allows big corporations to sue the U.S. government for any
decisions that prevent them from maximizing their profits. The egregious instance of TransCanada
announcing plans to use such rules in NAFTA to sue the U.S. government for $15
billion over the rejection of the Keystone XL tar sands pipeline is blatantly
ridiculous. It is contrary to the
greater good to allow big companies to use such provisions to challenge public
moratoriums on fracking, phaseouts of nuclear power plants, or other
protections of water, air and the global climate.
international trade agreements are insufficiently fair, they can lead to the
rise of reactive right-wing anti-immigrant movements that are dangerous to the
general welfare and peaceful coexistence.
The Brexit vote on June 23, 2016 is a shocking confirmation of this
observation. The European Union was
formed in 1993 to anchor
European countries in common bonds and shared
policies on trade, and to ensure the free movement of people, goods, services
and capital so that member states would prosper together in peace. The rash
departure of Britain from this coalition portends negative outcomes for
Britain, Europe and the world.
a union to dissolve into daunting uncertainties and more intensely amplified
conflicts is not a good plan. More than 65 million people have been
displaced worldwide at the end of 2015, and this new post-World War II refugee
record requires us to take courageous political action to stop conflicts and to
forestall the reactionary energy generated by anti-immigrant sentiments. As Filippo Grandi, the U.N. High Commissioner
for Refugees pointed out, "If you don’t solve problems, problems will come
to you." It is disturbing to
understand that refugee problems stem from not only environmental calamities
like severe droughts and resource shortages, but by conflicts exacerbated by
the destabilizing impacts of U.S. military interventions and related offensives
by terror groups. More than half of all
refugees in the world today are from three countries: Syria, Afghanistan and Somalia, and even more
tragically, over half of all displaced people are children.
percent of the population of Oxford, England favored a REMAIN vote in the
Brexit dustup, and I feel that the smart people there evaluated the choice in a
more civilized, rational and aware manner than those who have been riled up by
austerity policies and stoked fears and exacerbated insecurities and hostile
antagonisms toward immigrants and refugees.
12 million people from Syria have fled their homes, out of a total population
of 23 million: 6.6 million remained within the war-ravaged country and
4.9 million moved abroad. Imagine if a
similar percentage of Americans had been displaced -- if 150 million Americans
had been forced to flee their homes!
Our societies have always
been powerfully influenced by both zero-sum games and positive-sum
interactions. Zero-sum games are those
in which one person’s benefit is another person’s loss. In contrast, positive-sum interactions are
situations where people make choices that improve the lots of both parties at
the same time.
shift incentives from one-sided selfish gain to a more mutualistic, empathetic
and sane utility in which both sides benefit.
Specialization and exchanges of mutual benefits in commerce were
accompanied by the development of safeguards that were required to prevent
people who had the capacity to be ruthlessly selfish from exploiting all others
at the expense of the whole.
A key insight of
evolutionary psychology is that human cooperation and the social emotions that
support it -- like trust, empathy, sympathy, gratitude and guilt -- were
naturally selected for, over many generations, because these qualities allowed
people to flourish in mutually beneficial positive-sum interactions within
their own clans and in-groups. This
conferred definite survival advantages over other groups that had more fierce
and competitive and individualistic-oriented characters.
Human relations have
unfortunately too often been dominated by win-lose gamesmanship. These zero-sum games include ruthless
monopoly practices and arrogant plunder and predatory exploitation and
aggression in warfare. Some of the worst
of these zero-sum situations are so-called “social traps”. In a social trap, a group of people acts to
obtain short-term gains for themselves that lead to a net cost for the group as
a whole in the long run. Classic social
traps include “tragedies of the commons” conditions like overfishing and the
mindless extermination of wildlife, and overgrazing of cattle on fragile lands,
and the destruction of rainforests by logging and land-clearing agricultural
The most pervasive and
negative social trap of all is that of wealthy people who unrelentingly pursue
their own self-interest at the expense of the greater good of the whole. Politicians who pander to these rich people
help them intensify this inegalitarian and ill-advised national dilemma.
In capitalist economies,
a fever pitch of competition pits business owners and speculators and wealthy
people in a triumphalist struggle against reasonable prerogatives and fair
treatment of those who work for a living.
Unfairness in competition arises and becomes worse with monopoly
practices and corrupting abuses of power by people vested in anti-social selfish
advantages. In the process, social
justice and the overall security of the citizens of a nation are
undermined. It seems to me to be an
exceedingly poor plan to put policies into place that effectively force the
vast majority of people to be excessively busy, and to subject them to high
levels of stress by allowing corporations to squeeze workers mercilessly. It seems intolerably unfair to make the
rewards of increasing productivity by workers to be primarily beneficial to
business owners, managers and shareholders, and to blatantly deprive the vast
majority of workers from sharing more broadly in the fruits of their
are two modes of invading private property; the first, by which the poor
plunder the rich ... sudden and violent; the second, by which the rich
plunder the poor, slow and legal. One begets ferocity and barbarism, the
other vice and penury, and both impair the national prosperity and happiness,
inevitably flowing from the correct and honest principle of private property."
--- John Taylor of Caroline, 1814
my fellow Americans. Absorb the implication of this observation by
Senator Taylor 202 years ago during the infancy of our grand experiment in
democratic governance. An implicitly arrogant presumption that
private property and wealth deserve superior rights to real people underlies
provisions that perpetuate the status quo, but it’s a woefully bad plan to turn
up the heat on simmering rancor that leads toward either revolution or
authoritarian repression. Smart social
insurance policies that make the economy and political system fairer by
reducing extreme inequalities of income and net worth are a much better plan,
for they ensure more broadly shared national security and happiness, and reduce
risks of violent revolution. And they
give emphasis to the ideal articulated in the Pledge of Allegiance that our United
States of America really does represent a modicum of liberty and justice for
all, and is honorably and inalterably opposed to despotism, cronyism and
A Call for a New
The exuberant ‘Rough Rider’ Republican
leader Theodore Roosevelt advocated “Square Deal” policies during his
presidency in the early years of the 20th century, during the last decade of
Mark Twain’s life. Distinct parallels
exist between economic conditions back then and those today. In Roosevelt’s day, corporate entities like
railroad conglomerates and big oil companies abused their influence in
monopoly-like manners to quash competition, exploit workers, and foist a long
litany of harms upon society.
Today, banks and corporations have sprawled
across all international boundaries around the planet and gained so much power
that they can now declare themselves to be “persons” in the United States,
supposedly pursuant to the Fourteenth Amendment. This claim serves to give them valuable
rights like those of ‘due process’ and ‘equal protection’ under the law. Since corporate persons tend to be picky and
choosy about what ethics they subscribe to, they claim they should be accorded
the overarching right to maximize profits, minimize tax obligations, and receive
limited legal liability for wrong-doing and harms to other real people. These rights inadvertently mean that everyone
else in society has their fair rights circumscribed.
Theodore Roosevelt presided over a
“trust-busting era” in which many large businesses were broken into smaller and
less powerful organizations so that they would be less capable of abusing the
power of their size. Inequities between
wealthy people and working-class people had grown more and more pronounced, so
Square Deal policies were designed to curb abuses of power by corporate
entities and root out corruption and reduce the excessive exploitation of
workers, farmers and consumers. As a
part of his Square Deal, Roosevelt also laudably strived to ensure that
resources were conserved and great tracts of valuable public lands were
A new Square Deal is needed with similar
goals in the world today. This
initiative should be designed to assure people reasonable rights within
guidelines that include fair-minded responsibilities to every person in society
and all people in future generations. To
overcome injustices associated with the entrenched status quo, a sustained
movement is needed that will create an effective coalition with principled
leaders. Occupy Movement protests in
2011 helped inspire a national conversation about current extreme levels of
inequality, and they focused attention on efforts to increase economic
The anger and hope of similar movements
should now be channeled into strategies that will forge a new political and
economic order. We should all hope that
the forces of decency and humanity will prevail over those of reaction,
bigotry, polarizing divisiveness, discrimination, pigheadedness and
inequality. The compelling and
well-conceived documentary film Inequality
for All promises to advance this vital awareness by sharing Professor
Robert Reich’s poignant perspectives. So
does the overriding theme of Thomas Piketty’s Capital in the Twenty-First Century.
A modern new Square Deal should emphasize a
reduction in the concentration of wealth in the hands of the top 1% of
Americans. It should strengthen the
middle class and address the fact that more than 46 million Americans are
living below the official poverty level, as reported by the U.S. Census Bureau
for 2010. This is the highest number of
people in the more than 50 years that the Census Bureau has been publishing
figures on poverty. It is shameful that
our society has been reduced to such a degree of degradation for so many.
A study of the status of women in the U.S.
revealed that the worst six states for women, in terms of average pay, under-representation in leadership and barriers
to reproductive health care are Louisiana, Utah, Oklahoma, Alabama, Mississippi
and Texas. An average of 28% of women in
these states do not earn enough to lift them out of poverty. Sadly, all these states are dominated by
Republican politicians who hew to conservative orthodoxy, and thus prevent
women from being accorded fairer treatment.
There is plenty of shame in the ranks of politicians to go around!
We should remember the important understanding
expressed by Franklin Roosevelt:
"We cannot be content, no matter how high the general standard of
living may be, if some fraction of our people -- whether it be one-third or
one-fifth or one-tenth -- is ill-fed, ill-clothed, ill-housed and
Note that women are vitally important parts
of families, so it makes sense that they should be treated more fairly. Alert! The Global Gender Gap Report
2014, published by the World
Economic Forum, has found that the U.S. ranks 20th in gender equality in the world, far behind Iceland,
Finland, Norway, Sweden and Denmark, the nations that treat females most fairly. This Index measures gender equality by
studying the relative gaps between women and men in terms of four key areas:
educational opportunity, economics, health care and political
representation. I call for all citizens
in the U.S. to become more enlightened by acting boldly to improve the status
of women in these arenas.
Part of the
reason that the U.S. rates so low, curiously, is because of “The Caveman
Dilemma”, as Greg Hanscom explained in “Why
We Take Such Lousy Care of Ourselves and the Planet.” As it turns out, collective action is needed to help us make choices
that are in our own greater self-interest.
As a society, we need to agree together to make concerted efforts to
induce people to do what is right. And
government should be on the side of people’s best interests, because
traditional cultural conservatism undermines the principles of gender equity,
and people are too easily swayed by stereotypes and established biases.
All these ideas
are consistent with rallying cries of feminists and sensible ecological
economists and people involved in protest movements like the indignados in Madrid and the Occupy Wall
Street protestors in New York City a few years back, and their philosophical
kin around the planet.
Donald Trump has become the standard bearer who represents the official face of
the Republican Party in 2016, as nasty and ugly as this may be, and this is
having an adverse effect on efforts to improve the status of females in our
society. Such a conniving politician
wants to outlaw abortion, criminalizing it and then punishing women for making
the difficult decision to terminate a pregnancy, or punishing doctors who
selflessly provide this important service.
Males who get women pregnant? No
responsibility or punishment for them -- “just high fives for having scored
some sexual favors”.
Another disparity between Americans
highlights the extreme level of unfairness in our economic system today. It is the “intergenerational wealth
gap”. According to an analysis done by
the non-partisan Pew Research Center, the wealth gap between older and younger
Americans has widened sharply in recent years.
The average net worth of people over age 65 increased by 42%
between 1984 and 2009, while the average net worth for those younger than 35
years decreased by 68%. The
average net worth for those between the ages of 35 and 44 went down by 44%
during this period. These trends are
These statistics confirm that the interests
of older people have been given significantly more weight than those of younger
ones. Meanwhile, we are piling up
unfunded liabilities and risky levels of national debt and large interest
expense obligations. These will be heavy
burdens on people in future generations, and they will radically increase the
inequities our descendants will face in the future by forcing them to
effectively start their lives with an ever-increasing negative net worth. These trends are colossally unfair and
retrogressive and ill devised, and thus misguided and socially undesirable.
It personally irks me to see that we are
ramping up the real estate market once again, causing rapidly increasing
inflation in home costs in many places.
This makes it ever more challenging for renters and first-time
homeowners, two categories of people who are disproportionately young. The smartest plan for any society would be
found in farsighted investments made in its young people. Like in their heath, their educations, their
living situations and their overall well-being!
“If you think education is expensive, wait
until you see how much ignorance costs in the 21st century.”
--- President Obama
God’s Own Trumpet Sounds
for Greater Good Goals
Our courageous forefathers famously
declared in 1776 that when a form of governance becomes destructive of the
“unalienable rights” of its citizens, it is their right and indeed their duty
to alter that system and lay new foundations based “on such principles and
organizing its powers in such form, as to them shall seem most likely to effect
their Safety and Happiness.” When our
economic and political systems facilitate “a long train of abuses and
usurpations”, they simply must be changed.
Common sense tells us that NOW is the time to begin to revolutionarily
alter these systems.
The days figuratively run past like wild
horses over the hill. Ecological
“tipping points” appear to be approaching that could push us toward abrupt
changes in environmental conditions. And
social “tipping points” appear to be stoking revolutionary discontent and
outrage over increasing inequality, especially in destabilizing movements like
the so-called Arab Spring that is becoming a nightmare for millions of people.
Our Founders championed the honorable ideals
of the Enlightenment Era. These included
a measure of equality of rights for all, along with recognitions of the vital
importance of the general welfare of the people. In pursuing these goals, they tried to create
a fair system of representative government of the people, by the people and for
the people. This was a brilliant idea,
but the system they established was unfortunately susceptible to becoming
entrenched against fundamental reforms.
In many ways, the gap between our country’s ideals and its reality seems
to be growing wider and wider. It is
time today for us to unshackle our imaginations and reject discredited
ideologies, and to overcome the corruption inherent in the influence of Big
Money in our politics. It is time for We the People to collaborate together
with both determined idealism and grounded pragmatism, and to begin honestly
building healthier, fairer, and more fiscally and ecologically sound
Likewise, all people around the globe
should strive to make their countries fairer so that they will have sturdier
foundations, and thus help ensure they will more likely be sustainable far into
the future. I call on the ruling
interests in every nation to accept progressive adaptive reforms and help set
their peoples on more auspicious paths toward satisfying the intentions of
“general welfare” clauses like that
in the Preamble to the U.S. Constitution.
Reflections on Recent
After the first 12 years of the 21st
century finally staggered into the history books, I observed: “Wow, what a doozy they have been! First the terrible 9/11 terrorist attacks
took place, and then a colossally costly and unending global ‘war on terror’
ensued in reaction. Economic bubbles in
technology stocks and real estate and oil price speculation were inflated and
then burst, and there was even a bubble in the prices of contemporary art. Globalization trends intensified as the
economies of China and India grew at very rapid rates, and millions of jobs in manufacturing
were lost in Western nations to cheap labor competition overseas. Environmental impacts of fast growth in
consumption and increasing rates of resource exploitation became more
distinctly detrimental. Devastating
hurricanes, floods, droughts, wildfires, earthquakes and tsunamis wreaked havoc
in many areas. And the population of
human beings on Earth experienced a net increase of more than 800 million
Remember that an economic meltdown began in
December 2007 and reached its worst point in late 2008, and it still distinctly
impacted the global economy as the year 2016 unfolds. Think of it!
We have been living through one of the most sensational and scandalous
debacles in the history of capitalism, and in many ways it has been an “Inside
Job”. Laissez-faire “free market” capitalist
ideologies took a blow as unprecedented interventions by governments worldwide
were necessitated to get credit flowing again to prevent another serious
economic depression. Global bank losses
and write-offs exceeded $1 trillion. In
addition, Western governments committed an amount in excess of $10 trillion to
shore up their financial systems, according to estimates made by the
International Monetary Fund. About half
of this astonishingly large cost came in the form of direct financial commitments,
and the other half in various kinds of guarantees and insurance schemes.
Despite all these emergency measures, tens
of millions of people lost their jobs and many people lost their homes or a
significant portion of their retirement savings. The enormous costs of this economic bust were
foisted upon workers, taxpayers, and people in future generations who are being
obligated for gigantic liabilities and unprecedented levels of debt. This outcome is exceedingly unfair, so we
should boldly change course from the policies that contributed to this state of
Our economic system obviously does not work
adequately well when it fosters boom and bust cycles that force people to
shoulder the burdens of the bust who are different from those whose rash leveraging
of risks contributed most to economic cataclysms. Even worse, the adversities affect almost
everyone, while the perks and rewards have gone primarily to the culprits who
have profited the most from the inflation of economic bubbles.
Since tens of millions of people have been
hurt by the economic turmoil, it seems absurd to allow big bonuses to be paid
to the corporate and banking CEOs and top managers whose risk-taking decisions
contributed so significantly to this disastrous outcome. Our Congressional representatives, the
President, the business community, and shareholders take heed!
There is much to
be thankful for in the world, but this is certainly not the “best of all
possible worlds” that Dr. Pangloss wryly postulated in Voltaire’s famous short
story, Candide. We could, however, work together to create a
much better world, and the ideas in the Earth Manifesto suggest a wide range of
salubrious ways to achieve this good goal.
A Clarion Call for Reform
Journalist John Cassidy wrote a book titled
How Markets Fail: The Logic of Economic
Calamities. In it, Cassidy points
out the need for fundamental reforms in our economic and political
systems. He sagely observes that it is
not enough to merely tinker with the status quo. Our systems are structured in ways that
ensure the perpetuation of the status quo, or even worse, they facilitate
changes in the way things are that benefit entrenched interests at the expense
of the greater good. Consequently, our
systems are dysfunctional, and it is proving to be much too difficult to reform
them, making it increasingly important for us to collectively demand that our
econopolitical system is more fairly and honestly restructured.
Everyone can see that there are many
serious problems that need to be solved.
To fairly cope with these daunting existential challenges, an accurate
and comprehensive understanding of problems must be developed. The relative importance of items in our hierarchy
of priorities should be rearranged appropriately. And it is becoming
increasingly urgent for us to focus our energies and allocate resources
Albert Einstein once wisely observed, “We
can't solve problems by using the same kind of thinking we used when we created
them.” Einstein also noted that it is
insane to do the same things over and over again and expect different
results. So, let’s get creative!
The existentially challenging problems we
face include a wide range of environmental dilemmas and a variety of complex
conundrums related to social justice, peaceful coexistence, true fiscal
responsibility and proper long-term priorities.
We should deal more fairly with poor people to reduce the record number
of people living in poverty. We should
minimize undue interferences by the government with people’s personal
liberties. And we should give
overarching consideration to critical needs for giving greater respect to our
beautiful home planet’s ecological commons.
To solve these problems, a sustained and passionate commitment to the
greater good is required.
“Technique in art is like technique in
lovemaking: heartfelt ineptitude has its
charms, and so does
heartless skill, but what we all really want
is passionate virtuosity.”
the Population Connection
Ecology is a
comprehensive field of study that looks at broad inter-relationships between
plants and animals and ecosystems.
Ecology takes into account the impacts of human activities on natural
habitats, and it cultivates perspectives that are longer-term oriented than the
current short term-oriented ideologies that dominate our economic system. Ecological understandings are basically more
valuable ways of comprehending our species’ inter-relationships in the struggle
to prosper and pursue meaning and find happiness and live healthy lives.
Economic growth is the
overriding goal of most economic policies.
Growth is stimulated, in part, by continuous increases in the number of
people on Earth. From a long-term point
of view, economic growth is structured like a mega-Ponzi scheme predicated on a
growing population and an increasing consumption of goods by each person. This ‘plan’ cannot continue indefinitely, so
we should get our economic house in order and heed the insights of ecological
“Living is easy with eyes closed
Misunderstanding all you see.”
--- John Lennon, The Beatles, Strawberry
We can no longer afford to misunderstand
all we see. As of April 2016, there are
now more than 7.4 billion people on Earth.
Within less than 12 years, there will be EIGHT BILLION. By about 2040, current trends indicate the
global population will reach NINE BILLION.
By the year 2100, the United Nations estimates that there will be more
than ELEVEN BILLION, assuming no catastrophic setbacks. These trends mean much more than terrible
traffic! There will be a greater intensity of competition in the struggle to
survive and get ahead. This will cause
an escalating rate of resource exploitation, and limits will become more viscerally
clear. More serious
environmental problems will become increasingly apparent. Associated worsening poverty will make it
likely that more people will go hungry and engage in violent conflicts. These global challenges loom before us like a
tsunami gathering force and magnifying its deadly potential as it approaches
the shore. This wave seems to be
converging toward a crescendo, as if a Rapture-mad deity is wrathfully working
itself into a frenzy. But folks, the
cause of this danger is not God, it is us!
Compelling correlations exist between the
rapid growth in human population and the long litany of daunting environmental
challenges that face us, as articulated by organizations such as the Cousteau
Society, the Natural Resources Defense Council, and Population Connection. I strongly recommend that readers consider
the ideas of Professor Jared Diamond in his insightful book, Collapse: How Societies Choose to Fail or
Succeed. Diamond’s observations
about the depletion of native forests and other natural resources by the people
of Easter Island, and similarly myopic actions by other ruined civilizations
throughout history, make it clear that we would be wise to give much more
serious consideration to the implications of our own similar courses of action
on island Earth.
It is startling
to realize that more than 200,000 people died in a tragic earthquake in Haiti
on January 12, 2010, and yet they were in effect ‘replaced’ in total number on
Earth in less than one day. The number
of human beings alive has increased by more than 70 million each and every year
since 1965. This is stunning! And it is surely not a sustainable trend for
much longer. We should find ways to
restructure our economies and societies worldwide so that we are effective in
reducing the growth in the number of people on Earth. This would be a smarter strategy than
marching lockstep toward terrible tragedies when we have exhausted resources
and irreversibly damaged the vital ecological foundations of our
Thomas Paine was
eminently wise to suggest that the best way to confederate and embrace all the
various competing interests in a nation would be through a representative
democracy that fairly takes ALL interests into account as best possible. Shall we try it?!
We surely should give people in the future
much greater consideration and respect by committing our nation to the
overarching principles proposed in a Bill of Rights for Future Generations.
A Valuable Insight into
Professor Robert Reich was the Secretary of
Labor in Bill Clinton’s administration.
He discusses in detail a distinct conundrum of human behavior in his
insightful book Supercapitalism. As consumers, we generally want cheap prices
and good deals. By providing such
things, companies like Wal-Mart and CostCo and Amazon have been remarkably
successful. At the same time, people in
their roles as speculators and investors want the best possible returns on
In contrast, as citizens we value things
that are often contrary to what we want as consumers and investors. We want, for example, healthy communities and
expanded social justice and safeguards of our liberties. We want good quality public education that is
affordable, and a fair shake for workers.
We want reasonable access to health care for all. We want at least a minimal social safety net,
and a modicum of security in retirement, and equitable institutions, and
peaceable coexistence. We want clean air
and clean water, and protected parks, open spaces, public lands, wilderness
areas, wildlife refuges, and biological diversity. And we want a stable economic system with
credit adequately available at a fair cost.
In summary, as consumers and investors we
do NOT want products and services to contain all of the costs of a healthy
society, because we want prices to remain low and profits to be high. As citizens, however, we DO want prices to
include the fair and sane treatment of workers and communities and the
environment. Over the last few decades,
things have generally gotten better for consumers and investors, but they have
gotten worse with regard to good citizen goals and long-term
This way of looking at our economy makes it
clear that the competing interests we should be trying to “confederate” are not
just some clear-cut strife between “us and them”, but a conflict between the
goals within each and every one of us.
Recognizing this, it is crucial that we begin to require the inclusion
of all production costs in the prices of goods and services, so that consumers
will pay a little more for them and investors will receive a little less return
on their investments, but assurances will be made that common good goals will
have a better chance of being achieved.
A Big Perspective on the
Failings of the Capitalist System
There are a variety of shortcomings of capitalist
economic systems. Cyclical
periods of rash risk-taking and irrational exuberance are followed by periods
of fear-dominated aversion to risk.
These are the defining characteristics of Bull and Bear markets. Volatility tends to generate bigger fees for
Wall Street firms, and this makes these vested interests wealthy and
powerful. Other problems arise in addition to the
propensity within capitalist market systems to create destabilizing economic
booms and busts and to stimulate the unsustainable depletion of natural
resources and the degradation of our natural environs. Capitalist systems have a socially
irresponsible tendency to create ever-more extreme concentrations of wealth and
power in the hands of a small minority of rich people, and this money is
allowed to buy influence and power, effectively subverting democratic fairness
principles by seducing politicians into doing the bidding of wealthy people at
the expense of the greater-good interests of the vast majority of all
These dynamics of capitalism are facilitated by
socially unfair activities in which big profits are privatized while many costs
are socialized and environmental protections are ignored or violated. It is precisely because money is allowed to
buy so much influence that our national policies are so skewed to benefit the
few at the expense of the many. Rich
people, giant corporations and established interests manipulate our democracy
to the detriment of small businesses, innovative entrepreneurs and the majority
of Americans, as well as all people in future generations. This is how the system works, NOT just how it
often carry out a charade of pretending to be working to redress national problems,
when in fact they are pandering to financial and commercial interests to which
they are beholden. As a consequence,
they expend most of their energies striving to raise campaign funds and protect
the status quo and give entrenched interest groups even more advantages. This could and should be changed!
The overwhelming majority of Americans are members
of the Many. Together we have the
collective power to demand the formulation and implementation of policies that
would strengthen the middle class and make success easier for entrepreneurs and
small businesses, and also serve to alleviate the hardships of poor
people. Simultaneously, we could ensure
that our nation provide at least a minimally secure social safety net of health
care and affordable retirement. And we
could make sure that sensible precautionary principles are followed, so that
the environment is reasonably protected.
To accomplish these goals, much of the propaganda of
giant corporations and right-wing talk shows and think tanks should be
rejected. In their place, we should
cultivate clearer visions of the nature of human impulses and social
institutions, and the consequences of political policies, and the real aspects
of economic exigencies and ecological truths.
And we should demand action that is consistent with these larger
“In the nineteenth century, anti-capitalist critics
like Marx insisted that economics must be contained within an ethical
context; they contended that social
justice counted for more than industrial efficiency or private profit. In the late twentieth century, the
environmental movement is trying to teach us that both economics and ethics
must be contained within an ecological context.”
--- The Voice of the Earth, An Exploration of Ecopsychology, Theodore
A Vast and Rash
point is contained in the treatise Comprehensive
Global Perspective: An Illuminating Worldview in this manifesto:
The worldwide impacts of human activities
have never been as all-encompassing as they are today. The course upon which humanity is embarked
has many parallels in history, but at the same time it is unprecedented in
global scope. Technological and
demographic changes are affecting societies and the natural world with a broad
scope -- and an accelerating speed.
We are all inextricably involved in a rash
uncontrolled experiment in (1) industrialization, (2) urbanization, (3)
stimulated consumerism, (4) profligate resource use, (5) rapid population
growth, (6) large-scale monoculture agriculture, (7) economic globalization,
(8) excessively high levels of deficit spending, (9) asset speculation, (10)
financial deregulation, (11) inegalitarian social policies, (12) status-seeking
behaviors, (13) divisive political strategies, (14) aggressive militarism, (15)
extensive habitat modification, and (16) the generation of a myriad of
pollutants, toxins, wastes and greenhouse gas emissions into the
atmosphere. Almost every other species
of life on Earth is affected by this concatenation of activities. No one knows exactly what the outcome and the
consequences of this risky experiment will eventually be. …
To better manage our economic, social and
environmental challenges, we should cultivate new ways of thinking, and behave
and act with more broad-minded intention.
Strong resistance generally arises in opposition to ‘paradigm shifts’,
but when we are able to understand these challenges in bigger-picture perspectives,
the opportunities accelerate for achieving important progress and propitious
change. Among the many things we should
unflinchingly reform are socially irresponsible aspects of unbridled capitalism
and unfair imbalances in globalization.
National policies that create speculative bubbles should be scrupulously
evaluated to preemptively prevent the need for costly bailouts. We should invest in measures designed to gain
independence from fossil fuels. We
should make bold commitments to avoiding hawkish nationalism and imperial
aggression. Sensible and open-minded
attitudes should be adopted toward national policies regarding women’s health
and family planning and reproductive rights and contraception and
abortion. And our electoral system that
obeys Big Money over all other influences should be broadly reformed.
Nobel Prize winning economist Joseph
Stiglitz writes in Globalization and Its
Discontents that globalization has brought huge benefits to millions of
people worldwide, but that it has been poorly managed. Market fundamentalist ideologies have been
allowed to hijack good intentions, and the troika of international governance
institutions -- the International Monetary Fund, the World Bank and the World
Trade Organization -- have set the rules of international economic activities “in
ways that, all too often, have served the interests of the more advanced
industrialized countries -- and particular interests within these countries --
rather than those of the developing world.”
Joseph Stiglitz observes that globalization
should be reshaped to realize its greater potentials for the good of humanity,
and that international institutions should be reshaped to contribute to this
goal rather than to narrower goals of vested interest groups. This is smart thinking!
has expressed empathy with marginalized people like those stricken with extreme
poverty or migrants who are exploited or females who are trapped in sexual
slavery. This sale of life and dignity
is the dark side of markets, so Pope Francis vividly warns against the “globalization
of indifference.” He is not some sort of
devilish “neo-Marxist”, but he makes it clear that market outcomes are not in
general socially just, and he calls for public investment in fairer
opportunities in the world. “Absent a
moral commitment to human dignity, justice and compassion, capitalism is
conducive to materialism, individualism and selfishness. It is a system that depends on virtues it
does not create.”
When we see the bigger picture, it can help
us re-evaluate issues, and to be better able to shift our priorities to fairer
and more honorable ones.
from Observations of the Mark Twain Bank in St. Louis, Missouri
We are living in a
period when the inherent instability of capitalist economic systems is starkly
apparent. Economists called the
international credit crisis in 2008 “a Minsky moment”, after the little-known
economist Hyman Minsky, who developed a “financial instability hypothesis” in
connection with his personal observations as an economist and a director of the
Mark Twain Bank in St. Louis, Missouri.
I’m not making this up!
Hyman Minsky noted
that stability begets instability in a cyclical progression. In the early stages of an economic cycle,
banks lend cautiously to borrowers, sensibly requiring loans to be collateralized
safely with pledges of underlying assets.
When an economic boom begins to develop, the competition between lenders
intensifies and finance becomes more speculative as banks make loans to less
creditworthy borrowers. Eventually,
banks throw caution to the wind in a bubble frenzy, and indulge in “Ponzi
finance”. This is a scheme in which
borrowers are much more vulnerable to default because they may not even be able
to afford the payments on their loans.
A primary contributing
factor in this boom and bust cycle is the irresponsible actions of bankers and
traders. This is why rules governing the
financial industry should be changed to keep leveraging of borrowed funds
within safe parameters. It is also why
effective rules should be implemented to prevent systemic risks and
vulnerabilities from developing that lead to credit crises and economic
recessions. It just doesn’t make sense
to allow the ‘rational irrationality’ of self-interested players to subvert the
greater good in such significant ways.
This is an economic problem, and it is also a serious social and
environmental problem, and it has distinct ethical underpinnings.
description of the cycles in the economy reveals a salient fact: the best plan for society as a whole is to
make sure that there are reasonable minimum requirements for the amount of down
payments and collateral required for home loans, so that real estate booms and
busts are leveled out rather than being made more volatile. Clear rules should be formulated to ensure
that our entire economic system is not threatened by speculative risk-taking,
and to prevent excessively leveraged gambles and the unregulated use of
financial derivatives. A stable economy
is more important than a boom-and-bust bubble economy to the well-being of the
majority of people over the long term.
Some people say
that corporations should be allowed to regulate themselves. Joel Bakan, the author of The Corporation, strongly
disagrees. He points out: “No one would
seriously suggest that individuals should regulate themselves, that laws
against murder, assault and theft are unnecessary because people are socially
responsible. Yet oddly, we are asked to
believe that corporate persons -- institutional psychopaths who lack a sense of
moral conviction and who have the power and motivation to cause harm and
devastation in the world -- should be left free to govern themselves.”
I find this
perspective to be persuasive. We simply
cannot continue to allow big corporations to abuse their influence and evade
corporate favoritism, privatization and bubble economics have caused too much
financial turmoil in the past seven years, and we can no longer afford to allow
economic fundamentalists and laissez-faire proponents to dictate our policies
and dominate our national politics.
Surely the primary reason our government does not work better for the
majority of Americans is because it has been bought off by wealthy people and
big corporations and other vested interest groups. For more extensive insights into the details
related to this state of affairs, see Common Sense vs. Political
Realities: An Anatomy of Dysfunctionality.
Visceral Connections: The Intimate Impacts of Creative Destruction
economic systems tend to promote a process that economist Joseph Schumpeter
called “creative destruction”. By
allowing businesses to fail that do not compete successfully, a winnowing-out
takes place that ensures a kind of survival of the fittest organizations. This can have positive effects by letting
innovative forces transform markets, products, equipment and production
methods, making capitalism quite adaptive when competition is fair. But it can be extremely maladaptive when vested
interest groups use unfair tactics like monopoly practices, or when they take
advantage of the power of their size to quash competition. Likewise, negative outcomes are generally
associated with corrupt government policies and agencies that allow free rein
for entrenched interests to seize special advantages, privileges, and subsidies
destruction can have salubrious effects by improving production processes and
product quality, and healthy competition can lead to lower consumer
prices. But it can also wreak terrible
dislocations and hardships on workers and passive investors and the
environment. To manage change well,
individuals and businesses and the government need to be more flexible and
forward thinking, and give higher priority to the common good.
federal government is forced to bail out organizations that are “too big to
fail”, this thwarts market processes.
Under such circumstances, taxpayers should be rewarded for their rescue
of organizations that indulged in speculative risks and other types of “moral
hazard”. This compensation to taxpayers
should come in the form of significant stakes in the profits that the bailed
out entities earn after they recover. It
is unfair for us to risk national bankruptcy to save banks and other
institutions without requiring them to make large contributions to taxpayers
from their resurgent profits. It was,
after all, the speculative gambits taken by CEOs, bankers and other players
that are mainly responsible for the havoc wreaked upon millions of people
worldwide as a consequence of the 2008 financial crisis.
destruction sometimes merges with ruthlessly exploitive aspects of capitalism,
as analyzed by author Naomi Klein in her compelling book Shock Doctrine: The Rise of Disaster Capitalism. When this occurs, not only is our standard of
living at risk, but so is our financial, physical and ecological
well-being. Even our liberties and basic
human rights are at stake. We can begin
to take control of these dysfunctional aspects of capitalism only by understanding
them better, and by courageously acting in accordance with more enlightened
The Story of Stuff
The excessive promotion of consumption is contrary
to long-term greater good goals, especially when it contributes to the wasteful
depletion of resources and production of toxic wastes and the generation of
huge volumes of climate-altering greenhouse gases. Annie Leonard, the social
activist, folksy filmmaker and promoter of sustainability, explores the risk-laden madness of wasteful consumerism
in her compelling video The Story of
Stuff. She points out, startlingly,
that 99% of all the stuff we extract, produce, distribute and consume every day
becomes a waste product within 6 months.
Annie Leonard also created an animated
video titled The Story of Broke. In this film, Ms. Leonard succinctly
encapsulated important issues related to the misuse of taxpayer funds and the
misleading idea that our nation is broke.
She refers to the established status quo as “The Dinosaur Economy”, and
makes it clear that far too much money is given to companies vested in the
status quo in the form of tax subsidies, risk transfer subsidies, freebie
subsidies, and resource extraction subsidies.
She examines the folly of allowing businesses to externalize big costs
onto society for the clean-up of pollution and toxic wastes -- things that
corporate entities should be required to include in their prices and true
bottom-line profits. These simple and
entertainingly illuminating videos can be viewed online right now. The
Story of Change is another Annie Leonard video that provides valuable
perspective and ideas on how we might best head where we need to go.
With our human numbers
now exceeding 7.4 billion, and seemingly destined to reach 9 billion well
before the year 2050, we are going to run up against harsh limits in the supply
of food and raw materials and energy and fresh water. The capacity of the environment and the
atmosphere to absorb all the waste products, toxins and climate-disrupting
greenhouse gas emissions that result from this profligate consumption will
become a more crucial consideration. The
businessperson and organizational leader Oystein Dahle once made this
because it did not allow the market to tell the economic truth, and capitalism
because it does not allow the market to tell the ecological truth.”
The Republican Party and its angry, fervently
righteous and simple-minded Tea Party wing may deny these understandings, but
such denials will only have the effect of speeding the pace at which our
runaway train of consumption and waste production is lurching toward calamitous
outcomes. No matter how zealously the
myopic Tea Party crowd waves its <Don’t Tread on Me> flags, and no matter
how desperately our leaders strive to stoke consumerism to create jobs and
increase corporate profits, ecological truths cannot be indefinitely ignored.
The Tea Party does tap into some valid
grievances. The American people have
been promised beneficial effects of international trade agreements, but most of
those agreements are like the North American Free Trade Agreement that made it
easier for giant corporations to send factories and jobs abroad, and
contributed to conditions of stagnating domestic wages and worser opportunities
for blue collar workers and increasing inequalities. And Republican politicians have exploited
those feeling of grievance by scapegoating Mexicans and immigrants and Muslims
and gay people to gain more power. Don’t
fall for this social trap, for it is another variety of scurrilous hard times
swindle! Do not vote for the egomaniac
exploiter D.J. Trump!
“The survival of a
species is, by definition, biological existence that is indefinitely
sustained. The human race needs to more
clearly recognize and respect the fact that we cannot continue to consume far
more than can be supplied by natural and biotic resources, regeneration, and
healthy ecosystems. The carrying
capacity of damaged ecosystems is less than that of healthy ones, so it is an
overarching necessity for us to act to prevent harms to habitats that will
upset the providential balance in nature.”
Exhibited in Our Enveloping Maniacal Consumer Culture
are immersed in what psychologists call a manic culture. This manic state is characterized by short
and fragmented attention spans, scattered energies, poor impulse control,
compulsive behaviors, addictions to sensationalism, profligate spending,
shallow understandings, tweeted communications, unmindful argumentation, a
fixation on celebrity and eternal youth, occasionally indiscriminate sexual
appetites, widespread consumption of fast foods, happy-face promotions,
increasing susceptibilities to mental depression, and widespread uses of
anti-depressant and psychotropic drugs.
More than $200 billion is spent on advertising in
the U.S. every year to stimulate demand for products and services, and to sway
people’s opinions. This amount exceeds
the GDP of about three-quarters of the countries in the world. That’s A LOT of propaganda! This advertising can be a perniciously
manipulative form of indoctrination that results in a wide variety of outcomes
that are socially undesirable and even harmful when considered from big picture
Advertising is particularly effective in affecting
children, whose minds are not yet fully formed or capable of realizing that
such persuasion can be untrue, distorting and manipulative. The imagery of marketing can have negative
impacts on the development of young person’s brains, and it tends to objectify
gender roles and create unrealistic body images. Astonishingly, television
programs for children in the U.S. are interrupted by advertising on average
every 3 minutes. Every three
minutes! This is ridiculous. Brain conditioning at a young age is
especially seductive because the brains of youngsters are not able to easily
distinguish fiction from healthier visions of “reality”.
subjects people to a barrage of images and commercial messages that are loud,
seductive and insidiously intrusive. The
medium in which messages are delivered has profound impacts that are
influential beyond the scope of the content of the messages. Repetition in advertizing can imprint
commercial messages on our subconscious minds with a force that contributes to
unhealthy fixations and manic character.
This is one reason why attention-deficit and bipolar disorders are proliferating!
successions of images, subconscious messaging, persuasive marketing, and
chatter on social media are physiologically affecting our brains, contributing
to misguided values, sleep deprivation, alienation, rude behaviors, rage and
mental depression. Our psyches are
powerfully influenced by programming that is focused on celebrities,
sensationalism and violence. Polarizing
political rhetoric, ranting talking heads on television, and anger and hate
incessantly expressed on talk radio (and on many websites) also take their
toll. The demonizing of people with
differing perspectives, and imagery containing demeaning stereotypes, all
contribute to mania in our cultures. The
increased susceptibility of many Americans to depression makes it the leading
cause of disability, and anti-depressant drugs currently are being prescribed
to more than 20 million Americans.
many drugs that are available over the counter in other countries are sold only
by prescription in the U.S., which is one of the few advanced nations that
allow direct advertising of prescription drugs to consumers. Such
advertising is becoming increasingly obnoxious and intrusive, because it is so
repetitive, especially ads for erectile dysfunction drugs and prescriptions for
unsavory afflictions, all of which disclose long lists of harrowing potential
doctor!” Even the American Medical
Association favors a ban on advertising prescription drugs directly to
consumers. Spending on such advertising
has increased by 30% in the past two years, contributing to an unnecessary
increase in the prices of prescription drugs.
Revealingly, such advertising became ubiquitous only after lobbyists
managed to get the Food and Drug Administration to make regulatory changes in
1997 that allowed it. Seeing the many
negative impacts of such advertising, and a paucity of positive ones, it is
high time for the FDA to reverse this decision.
In particular, ads for prescription drugs like Viagra and Levitra that
encourage sexual activity should be banned from prime-time television on the
grounds of common decency.
in all, what we really need is a prescription for more positive
influences! Here are a few. Experience nature outdoors more often. Join the Slow Food movement and enjoy
leisurely meals with friends or family.
Spend time cooking or gardening.
Listen to soul music, jazz, classical music, or the blues. Find time to meditate or enjoy silence. Read an entertaining or spiritually uplifting
book. Immerse yourself in Carl Jung’s
Spirit of the Depths, not just in the Spirit of the Times. Be with what is. Sing words of wisdom. Create some “senseless acts” of beauty and
generosity. Cultivate friendships. Accentuate the positive. Breathe deep and let go of negative thoughts
that compel obsessions. Recover an
authenticity of the soul by focusing on honest spirituality, true values, and
healthier philosophy. And support
progressive ideas and reforms.
watch some comedy by stand-up comedians or late-night entertainers like Jon
Stewart or Bill Maher or Stephen Colbert.
Humor is healthy! Think, for
instance, about the “Friends of Irony” email that once circulated on the
Internet, which contained visually funny photos of ironic juxtapositions of
various images. One showed the
reader-board of upcoming events at a church’s Parish Hall. It reads:
MONDAY ALCOHOLICS ANONYMOUS
TUESDAY ABUSED SPOUSES
THURSDAY SAY NO TO DRUGS
FRIDAY SOUP KITCHEN
“AMERICA’S JOYOUS FUTURE”
That struck me as a funny commentary on our culture, almost as humorous
as a handwritten sign in front of “Le Petit Mort”, which read:
Psychic Fair Cancelled
Due to Unforeseen Circumstances
A Fascinating Fact and a
spending in the USA was the highest it had ever been in 2010, relative to total
incomes earned. Spend, spend,
spend! This situation cannot continue
indefinitely. Debtor’s prisons may be a
thing of the past, but I’ll bet big banks and their friends in Congress will be
thinking up new ways to make sure that huge banking profits are not jeopardized
by the declining solvency of students and the majority of the American
people. I wonder if it’s possible that
they will flip to the far side, and think like Henry Ford, who believed that by
paying his employees generously and putting other policies in place that help
build a healthy middle class, we might thereby put most Americans on a path
toward saving more money so that they can actually afford to buy more products
that are produced by businesses. Such a
course of action makes good sense!
Steps to Greater Fairness and Justice
The Founders of modern democracies
essentially championed a social contract in which greater fairness and justice
for a nation’s citizens would be honored and respected. To actually create such a state of affairs, our
economic and political systems need to be re-structured so that they actually
do provide for fairer and more just conditions.
One important reform that would ensure
greater fairness to people in future generations would be to require businesses
to include all currently externalized costs in the price of every product and
service, particularly those costs related to the prevention and clean-up of
pollution and the safe disposal of wastes and toxins, and medical care for
people harmed by pollution. We should
additionally re-evaluate all government expenditures and tax loopholes that
provide subsidies to big corporations.
Subsidies to vested interest groups tend to hamper competition and
impede innovation. Taxpayers are forced
to finance these subsidies without enjoying adequate benefits, and this is
contrary to the greater good. The
influence of vested-interest money in election campaigns and the intense
lobbying of our representatives in Congress to manipulate their decision-making
should be limited, so that the policies implemented are more consistently and
honestly focused on the common good.
“Rent-seeking” is the general term that economists use for gambits
employed by exploitive interests to get money at the expense of the
public. Rent-seeking activities today
often refer to efforts to capture various monopoly privileges that stem from
government regulation of a market.
Rent-seeking, in general, involves getting a bigger share of existing
wealth, rather than actually creating any new wealth. Joseph Stiglitz analyzes this concept in
Chapter Two of his compelling book The
Price of Inequality. He discusses
the curious fact that countries with large amounts of crude oil, like
Venezuela, Saudi Arabia, Iran and Iraq, which should be able to afford to treat
their people more generously because of the huge windfall receipts of money
from their large oil reserves, tend instead to have more inegalitarian
societies because of political corruption and rent-seeking abuses of
power. While an abundance of natural
resources should allow countries to take better care of their poor people, and
to invest in things like better education systems and universal healthcare, it
turns out that countries with the most natural resources are often among the
ones with the most extreme inequalities.
Another form of rent-seeking involves selling things to the
government at prices higher than
market. Drug companies and military
contractors excel in this form of socially detrimental scam.
Rich people worldwide tend to gain at the expense of everyone else
by means of a variety of socially undesirable rent-seeking activities. These actions and swindles include perverse
government subsidies, laws that make the marketplace less competitive, lax
enforcement of existing laws, and statutes that allow corporations to take
advantage of others or to foist costs onto the rest of society.
The Perspectives of Arthur Cecil Pigou
arguments can be quite complex. But it
is important to understand them in a comprehensive way. This is how we can create the best balance in
decision-making. Take, for instance, the
insights of Arthur Cecil Pigou, a British economist who was one of the first
people to articulate the nature of imperfections in markets and to examine
market failures due to “cost externalities”.
A big variety of
deep interdependencies exist between people, and there are many “spillover
effects” of one person’s actions onto the well-being of others. The same is true for businesses. For this reason, Arthur Cecil Pigou advocated
subsidy incentives (“extraordinary encouragements”) and tax disincentives
(“extraordinary restraints”), because such mechanisms generally have the
salubrious effect of properly reflecting both social benefits and costs to
society that are not accounted for in private transactions.
This idea of
properly designed incentives and disincentives, boldly implemented, is one of
the best plans for making our societies healthier and more sustainable. A “Pigou Club” of prominent economists and
pundits recommends that we enact higher gasoline taxes or other forms of carbon
emissions taxes. The purpose of these
taxes would be to allocate a higher price to the burning of fossil fuels, so
that cost externalities associated with risks created by our dangerous
addiction to these sources of energy would be reduced. Pigouvian taxes like this would serve to
reduce the rate of increase in the quantities of greenhouse gases we are
spewing into the atmosphere every year.
We should listen to these Pigou Club experts in this regard. They include a wide range of people like Paul
Volker, Alan Greenspan, Bill Gates, Jeffrey Sachs, Paul Krugman, Joseph
Stiglitz, Robert Reich, Lawrence Summers, Michael Bloomberg, Al Gore, Bernie
Sanders, Thomas Friedman, and even Arthur Laffer, Charles Krauthammer and
effect of a new incentive system designed to increase fuel efficiency on all
new vehicles sold. If much higher sales
taxes were assessed on purchases of vehicles that get less than 20 mpg, and the
proceeds were used to provide rebates for all vehicles that get more than 40
mpg, it is easy to see how demand for vehicles would be significantly shifted
to more fuel efficient vehicles. Such a
system of incentives would powerfully influence people’s choices. We could even be more effective in weaning
ourselves from our Achilles’ heel dependence on imported oil from foreign
countries, and from extremely high costs related to positioning our military
forces in and around nations that have the biggest oil reserves in the world. At the same time, we would burn less oil and
cause less pollution and create fewer greenhouse gas emissions, and hence cause
less damaging changes to the global climate.
This would be a smart course of action!
taxes are only 18.3 cents per gallon, and they have not been increased since
1993. Inflation diminishes the value of
money over time, so the net amount of this tax has effectively gone down by
more than one-third in the past two decades.
Simultaneously, the costs of materials for highway construction, repair
and maintenance have increased by more than 50%. The costs of military expenditures to ensure
uninterrupted access to imported oil from Middle Eastern countries have
skyrocketed. Costs for public health,
traffic congestion, and environmental damages associated with oil industry
activities and transportation systems and air pollution have also increased
much faster than the rate of inflation.
And our national debt has reached unprecedented levels, exceeding a
staggering $19 trillion in early 2016.
This penalizes people in the future as a result of our weak-willed
inability to manage more fairly and fiscally responsibly.
conclusion is that gasoline taxes should be increased to help finance these
People buy insurance to cover potential
calamities like floods, fires and auto accidents. But when it comes to larger considerations of
our probable impacts on the health and well-being of people in future
generations, we seem to be unwilling to pay a bigger premium in the prices of
products and services to finance the costs externalized onto society, or to
mitigate the adverse health impacts of polluting activities. We essentially are collectively unwilling to
act to minimize damages done to ecosystems, or to reduce the pollution of
waterways, or to prevent inadvertent impacts of human activities on the gaseous
composition of the atmosphere and the stability of Earth’s climate. It is time for us to remedy this state of
affairs by making fiscally and ecologically intelligent changes in the systems
that encourage these misguided outcomes.
Almost all free market economists and
people who advocate a better-managed economic system admit that incentives are
important. But free markets give too
little emphasis to aspects of existence that are vital to our collective
well-being. They do this because they
fail to adequately take into account the guidance of socially fair and
environmentally enlightened understandings.
To get economic
incentives right, it helps to understand big picture perspectives. We should stop blindly acting as though
corporate prerogatives and laissez-faire business doctrines are the end-all of
policy making. Too many of the
incentives created by corporations and governments are “perverse incentives”,
like those in the banking industry that encourage speculation and highly
leveraged risk-taking and predatory banking practices.
should be designed to encourage people to behave in ways that are more socially
and environmentally beneficial.
Disincentives should be formulated and instituted to prevent costs from
being foisted onto innocent victims.
Cost-shifting from corporations to taxpayers and people in the future
should be reduced. Once the details and
magnitude of this cost shifting are understood, we should be better able to
make smarter determinations of how to structure incentives and disincentives so
that they reflect realities and mitigate adverse impacts on society.
Environmental Protection Agency completed a six-year study in 1997 that took
into account the human health and welfare and environmental effects of the
Clean Air Act. The EPA found that the
total benefits of Clean Air Act programs in the 20-year period from 1970 to
1990 ranged from about $6 trillion to about $50 trillion, with a mean estimate
according to varying assumptions of $22 trillion. These benefits represent the estimated value
that Americans place on avoiding the dirty air quality conditions and dramatic
increases in illness and premature deaths that would have prevailed without the
1970 Clean Air Act and associated programs at the state and local level.
actual costs of achieving these benefits of pollution reductions over the 20
year period were $523 billion. This is a
small fraction of the estimated $22 trillion in benefits gained. From this perspective, it seems obvious we
should collectively be making choices that respect environmental protections,
rather than allowing them to be undermined by narrowly-focused interest groups!
A study by the federal Office of Management and
Budget in 2003 sought to evaluate the cost and impact of environmental laws
over the 10-year period from 1992 to 2002. The extensive analysis found
that the cost to businesses and government of environmental and health
regulations was 5 to 7 times less than the costs to society related to
dealing with pollution and toxic waste clean-up and related adverse healthcare
expenses for workers, families and people in communities nationwide.
These findings prove that it is downright absurd to let lobbyists and
politicians rewrite environmental laws to weaken protections like those of the
Clean Air Act.
Many of the incentives in our economic and
political systems are sadly misguided.
They provide big benefits to small constituencies while costing
significant amounts to the general public.
Incentives like this should instead be re-targeted to provide overall
benefits at reasonable costs. We should
keep in mind that these costs are not just monetary ones. They include harmful impacts upon real
people’s health and the quality of their lives.
exceptionally stupid laws in every county and every state and every
country. Let’s all agree to demand that
our representatives in the United States work to get rid of the worst
ones! In Happy Harbingers in Good Ideas for a Better Future, the creation of
an Office of Public
Integrity is proposed. Its mission would
be to establish a system of Citizens’ Civil Grand Juries in every county and
state in the U.S., along with a federal Civil Grand Jury. One of the responsibilities for these bodies
of citizen volunteers could be to solicit input from all citizens as to which
are the stupidest laws in effect in their jurisdiction, and these Civil Grand
Juries should be given the responsibility of assessing the merits of the laws
suggested as the most stupid. These
Juries should use the criteria of comprehensive
considerations of the negative consequences of the laws, both intentional and
unintentional. The Civil Grand Juries should be
authorized to submit
their findings to appropriate officials who would be expected to deliberate and
take action to get rid of such laws.
If we let up on the masses a bit more with
less opprobrious laws, this strategy would make everyone more secure. Let’s pass a national minimum wage law
starting at $12 per hour immediately, indexed to inflation for annual
increases. Let’s honestly debate the
value of investments in people rather than in the padded bank accounts of those
who get the biggest proportion of benefits in our society.
A Discordant Tune Rudely
Interrupts the Course of This Soliloquy
Anyone who has been sucked into the lures,
scams, high costs and extreme-pressure sales presentations by timeshare industry
agents will find the reality-show-like documentary film The Queen of Versailles to be a sad cautionary tale of crass
materialism, pathetic hubris and tawdry conspicuous consumerism.
This film is a revealing and unsavory story
about a wealthy timeshare magnate named David Siegel and his “aging trophy
wife” Jackie, who is 30 years younger than him, and their eight children, and
the woes that befall them when the real estate bubble burst and the financial
system froze up during the recession of 2008.
When the economic downturn began, the Siegel family was building the
biggest private home in America, a 90,000-square-foot home in Florida that was
modeled after the Palace of Versailles.
Apparently the 26,000 sq. ft. home they lived in was just not enough to
match their needs and egos. David Siegel
was also involved in constructing a massive 1,250-unit luxury towers project in
Las Vegas and other Westgate Resorts timeshare projects. The credit crisis posed a serious financial
challenge to this rags-to-riches family, and the story of the Siegel family’s
pathetically gaudy prosperity and fall toward bankruptcy makes viewers feel
that our society needs a serious dose of respect for more moderate consumption
and more sensible national policies. The
obtuse follies of some rich people make it appear eminently reasonable for us
to re-focus our national policies on benefitting groups of people other than
grotesquely self-centered people like these!
Queen of Versailles is a modern view into the character and
eccentricities and practically lurid excesses of a family caught up in a
perverse version of pursing the American Dream.
The exceedingly heavy ecological footprint of these wealthy people is
almost incalculable. This tale doesn’t
resemble a glamorous episode of Robin Leach portraying the Lifestyles of the Rich and Famous.
It is rather the story of a pathetic family led by a shrewd businessman
who is extremely insensitive to the wastefulness of materialistic
consumerism. The film is reminiscent of The Beverly Hillbillies TV show of the
1960s, which depicted a family of unsophisticated “hillbillies” who had struck
it rich in oil and moved to Beverly Hills, where they lived ‘high on the hog’
next to a greedy bank president and his blue-blood wife, with a variety of
resulting funny situational culture conflicts.
David Siegel brags in the film that he
personally got George W. Bush elected, hinting that he did so illegally. This is reason enough to bemoan David
Siegel’s powerful influence, considering the terrible impact that the policies
of President Bush had on the U.S. in terms of the wantonly irresponsible tax
cuts for the wealthy that have contributed to huge increases in deficit
spending and the national debt. We still
have not recovered from these indulgent and unwise initiatives, or the
extremely costly wars Bush involved us in abroad. There is a distinct possibility that future
financial crises will be caused by factors related to these rashly imprudent
actions. For this reason alone, David
Siegel and his ilk should not be coddled with such pathetically generous
national tax policies.
Ruth Stafford Peale was the wife of
Reverend Norman Vincent Peale, the man who wrote The Power of Positive Thinking. She
once said, “Find a need and fill it.”
This was great entrepreneurial advice.
The timeshare industry was built on a far less noble adage: “Create a need by exploiting people’s desires
for luxury, and manipulate people using high-pressure sales presentations into
buying a timeshare product that is often excessively costly.” As much as 50% or more of the original price
of a timeshare purchased from a developer goes toward marketing costs, sales
commissions and other fees. Timeshares
turn out to be poor investments for the majority of buyers. We obviously need to more intelligently
refocus our economy and national priorities!
The Goddess of Irony appears to have taken
an avid interest in this story, for here's a sensational denouement to it.
As the 2012 presidential election approached, David Siegel sent an
email to all of his employees. “Of
course, as your employer, I can’t tell you whom to vote for,” he wrote, but he
scurrilously offered “a few facts that might help you decide what is in your
best interest.” He declared that re-electing President Obama would
“threaten your job” and result in “less benefits and certainly less opportunity
Scott Keyes, a senior reporter for the Center for American Progress,
wrote a fascinating report in early 2015 about how wrong Siegel turned out to be
in this prognosis of economic doom if President Obama were to be re-elected, as
of course he was. "Just over two
years after penning that company-wide email, Siegel informed Westgate employees
that instead of layoffs, he would boost their minimum wage to $10 per hour
beginning in 2015. In fact, according to
Siegel, 2014 was a banner year."
"We’re experiencing the best year in
our history and I wanted to do something to show my gratitude for the employees
who make that possible,” Siegel said in announcing the wage hike. He
also told the Orlando Business Journal, “things have never been better.”
Despite writing in 2012 that any tax
increases on the wealthy would mean job losses -- “Rather than grow this
company I will be forced to cut back,” he said at the time -- Siegel has been
extraordinarily successful growing Westgate in the two years since taxes were
modestly increased on the wealthy. In 2014 alone, Siegel and Westgate
bought a hotel in Las Vegas for $180 million, began constructing a large retail
center in Orlando, and purchased the Cocoa Beach Pier. Siegel also
acquired the Orlando Predators Arena Football team and
continued constructing his 90,000 square-foot mansion, which will be the
biggest in the entire United States once it is completed.
Siegel isn’t the only conservative to have
predicted economic doom if Barack Obama won re-election. Among others were Mitt Romney, who
argued that unemployment would be stuck above eight percent, and Donald
Trump, who predicted a crash in the stock market. Instead, since November 2012, the unemployment
rate has dropped to the 5% percent vicinity, and the stock market has
jumped 5,000 points to record highs, before becoming more volatile as
Republican presidential candidates in 2016 predict more doom and strive to gain
more power, which would be more likely to make such prognostications come to
Oh, come all ye faithful, stop believing in
the dark prognostications and prescriptions of these "conservatives"!
implications of these facts. Being imprisoned in the echo chamber of
their own solipsistic extreme conservatism, most die-hard right-wing partisans
do not have an accurate understanding of what really constitutes the greater
good. Conservative billionaires like David Siegel don't seem to have a
clue as to what really constitutes the common good, and in their greedy myopia,
they often don't even understand what contributes to their own best interests.
A classic example of this was demonstrated when Ronald Reagan criticized
Social Security in 1961, warning that if a program of subsidized medicine was
enacted (which it eventually was, when it became Medicare), it would
"curtail Americans' freedom" and that "pretty soon your son
won't decide when he's in school, where he will go or what he will do for a
living. He will wait for the government to tell him." Trickle
down apologists claimed that tax cuts will pay for themselves. Free trade
agreement proponents authoritatively assert that trade agreements will be best
for the American people, but they are written to benefit giant corporations and
thus often betray the best interests of millions of American workers. War
enthusiasts believe preemptive wars and military occupations will prove to be
advantageous for the prosperity and security of the American people, but the
unintended consequences of such aggression usually prove them dead wrong.
Not long after watching The Queen of Versailles, I just happened
to see Rory Kennedy’s good film Ethyl about
her then-84-year-old mother Ethyl Skakel Kennedy and Robert F. Kennedy, who had
been assassinated on June 6, 1968 during his run for President. What a startling contrast in families! Ethyl and Robert had eleven children, and
almost every one of them dedicated their lives to some aspect of social and
environmental justice. The striking
contrast of the trajectory of David and Jackie Siegel’s eight children portends
much more pathetic and less noble involvements in the world. Progressive nurturant values and concerns for
the greater good can be seen to be significantly more desirable from the
standpoint of society as a whole than narrowly selfish and unempathetic values
that typify ‘conservative’ Strict Father values.
Once again it seems clear that, as a
nation, we should strongly support broadminded attitudes, better systems of
public education, expanded opportunities for the vast majority of people, and
far-sighted investments in the well-being of the American people. We should do these things instead of giving
in to Republican impulses that focus our national priorities on ever-lower tax
rates on the highest income earners, and ever-more perks for people who are
wealthy, and cuts in government programs that would otherwise help the average
American. Policies that create more
severe austerity for the majority of Americans are not a good idea. Efforts to slash food stamp outlays? What next?!
In July 2015, presidential candidate Jeb
Bush declared that American workers must work longer hours to gain more
income. This observation ignored the
fact that the average American worker already works longer hours than workers
in every other advanced country in the world.
The real problem is that the inflation-adjusted compensation for the
average American worker has been frozen for decades because of misguided
national policies, and many jobs do not provide living wages.
A Call for Fairer
and More Progressive Taxation
changes in our system of taxation tend to concentrate wealth and increase
disparities between the fortunes of the Few and the Many. This results in increases in inequality that
make everyone in society less secure.
Poor people and those in the middle class become less secure in economic
terms because their struggle is made harder to pay for safe housing, good
nutrition and adequate healthcare. The
rich become less secure because a heightened impetus develops in society toward
stress-engendered conflicts, crime, and excessively costly repression and
incarceration. More money is
consequently needed for police forces and prisons to enforce this inegalitarian
state and to defend against increasing impulses toward revolutionary or
reactive change. More money is also
spent on wars to distract people from a lack of fair opportunities, and from
the daunting existential dilemmas associated with our unfairly rigged and
gimmicky econopolitical system.
Occupy this thought: The rich have pressed
their luck too far by abusing the power of their influence to get the lowest
tax rates in generations at a time of record debt and wide-ranging socioeconomic
crises. We should now take action to
make sure that the Bush tax cuts on all earnings in excess of $250,000 are
ended. By restoring tax rates to the
levels that pertained during the Clinton era for all annual earnings above
$250,000, future deficit spending could be significantly reduced. We simply cannot afford to borrow more money
to allow the richest 2% of Americans to hoard it and let them pay historically
low tax rates. Such gambits come at the
expense of the other 98% of Americans, and of all persons-to-be in future
Business magnate Warren Buffet once
provocatively suggested that federal budget deficits could be ended “in five
minutes.” Here’s what he suggested: “You just pass a law that says that anytime
there’s a deficit of more than 3% of GDP, all sitting members of Congress are
ineligible for re-election.” Of course
our representatives would never pass such a law unless there was intense and
unified pressure from their constituents.
Ummm, shall we? The point, in any
case, is that a law like this would put the incentives in the right place to
help deal with the risky, unfair and foolish expediency of record levels of
five-year plan to dramatically reduce federal budget deficits is articulated in
One Dozen Big Initiatives to Positively
Transform Our Societies. See the
Fiscal Responsibility Act under the heading Balanced Budgets Initiative. This plan would be highly effective in
reducing federal deficits because it would give the primary deciders in our
econopolitical system -- wealthy people, CEOs and top managers in banks and big
corporate entities -- a powerful motivation to demand that politicians actually
move toward fairly balancing the national budget.
One observer has noted: “Time and again we have proven incapable of
addressing major national concerns without the boot of acute crisis bearing
down on our necks.” This is true, and
yet today, as we struggle to emerge from the throes of the most severe economic
crisis since the Depression of the 1930s, gridlock prevails in our
politics. We seem to be incapable of
making fundamental changes like fair-minded campaign finance reform and more
strict lobbying restrictions. We have
been unable to make really smart changes to our banking system like restoring
the sensible Glass-Steagall Act to eliminate conflicts of interest between the
activities of depository banks and investment banks. No serious efforts have yet been made to
reform the Commodities Futures Modernization Act of 2000 to sensibly regulate
the risks of financial derivatives that contributed to the severe credit crisis
of 2008 and on-going economic instability in Europe, the U.S. and many other
We also seem incapable of sensibly
improving our highly unfair and costly healthcare system. Our political representatives have adamantly
refused to create a single payer universal healthcare system, and they have
denied people the freedom to buy a public option that would compete with profit-prepossessed,
coverage-denying plans sold by the health insurance industry. We have been unable to rein in the
ludicrously profitable Big Pharma industry with all its predatory marketing
schemes and obnoxiously aggressive advertising and powerfully influential
lobbying. Our leaders are reluctant to
seek common ground to reform our fragmented immigration and labor
policies. And we are collectively
failing to invest adequate amounts in important infrastructure maintenance and
In addition, many schools are deteriorating
and student debt is becoming burdensome to a ridiculous extent. Interest rates on student loans are too high,
and bankruptcy laws related to student loans are downright medieval. We are failing to take smart steps to prevent
a looming eventual insolvency of the Social Security and Medicare systems. We seem to be unable to pass an adequate
climate protection bill, or to come up with a rational national plan for
independence from our addiction to wasteful and polluting uses of fossil
fuels. And we are proving to be
incapable of rationally limiting budget deficits caused by our expedient
propensities to borrow money to finance wars and give people tax cuts and
bailout the economy and give vested interest groups more perks.
These issues must be boldly and honestly
addressed! The Earth Manifesto points
The Implications of
Systemic Unfairness on Our National Health
Think about the red tape and profit-making
in the health insurance industry. The combined profits for the five largest health
insurers in the U.S. increased 56% in 2009 over 2008. The employees and investors in these
companies were probably quite pleased with these results, but they represent a
heavy burden of high costs to millions of people whose lives are detrimentally
impacted by high annual increases in premiums, or by care denials or exclusions
for “pre-existing conditions” by medical insurance corporations. Big increases in medical insurance costs for
individuals and small businesses have caused tens of millions of Americans to
be unable to afford health insurance.
More than 45 million Americans did not have health insurance before the
Affordable Care Act was enacted. This
fact makes it urgent that we make much more sincere reforms to the U.S. health
Look at it this way. Each and every person is born, gets older,
and eventually dies. No one knows what
the vicissitudes of destiny have in store for them, and infinite are the
variety of potential adverse circumstances faced by individuals. Anyone at any time can suffer a serious
accident, disease or other health calamity, so we should have a medical
insurance system that covers everyone fairly.
On average, an American
today lives to be 80 years old, according to World Health Organization
statistics. This longevity is shorter
than the average lifespans of people in more than 30 other nations, according
to the Wikipedia “List of countries by life expectancy”. Why does our supposedly advanced nation
perform worse than so many other countries?
The reason is to be
found in a curious place: inegalitarian
public policies. Our healthcare system
has a primary focus on profit-making by insurance companies and drug companies,
NOT on fairly providing for the health of American citizens. About 45,000 people die each year as a result
of things like medical coverage denials and high costs for health insurance,
according to estimates by researchers at the Harvard Medical School. Why do they die? “In large part because they lack health
insurance and can not get good care.”
Fairer societies tend to
have greater average longevity because all people have better access to
preventative care and affordable care.
We should give these understandings greater consideration in the
national debate about how to reform the U.S. healthcare system!
STAND AND DELIVER!
Mark Twain was
robbed by “highwaymen” in 1866 during his stay in the silver mining boomtown of
Virginia City in what was the Nevada Territory at the time. He reported that a bandit “thrust
a horrible six-shooter in my face and demanded, ‘Stand and deliver!’”. In those gun-toting days of the Wild West,
life and property were not particularly respected, so a person was well-advised
to comply with such an imperious command, no matter how offensively criminal it
may have been.
I’m not a big fan of the use of force, or
of the expanding ownership and uses of guns in these more modern times. But as an organizational imperative, I like
the sound of this command. “STAND AND DELIVER!” Say, can’t we tell our political leaders, and
CEOs of big corporations, and investors and the relatively small number of
wealthy people who gain half of all the income and own half of all assets in
this country, to STAND AND DELIVER!?
democracy and more progressive tax policies!
Deliver a greater equity of job and educational opportunities in our
nation. Deliver a better means of
adequately financing our national infrastructure. Help create truer social justice and fairer
economic policies, and cleaner sources of energy, and universal healthcare, and
more honest fiscal responsibility, and saner environmental policies. We want and need these things!
The enactment of
a Bill of Rights for Future Generations might prove to be the best way to
constrain our short-term-oriented addiction to mortgaging the future. Cease and desist with this on-going orgy of
expedient and irresponsible deficit spending to finance low tax rates on high
incomes! STAND AND DELIVER!!
Two Theories of Socioeconomics
Deepening disparities of wealth --à Less
financial and health security for most people --à
--à More societal stresses and
anxieties --à More civil
unrest --à Higher
prison costs --à
personal and national security for all.
(A BAD IDEA!)
More People ---à More
consumption ---à More waste ---à More ecological damage --à
--à More species extinctions --à A less sustainable future --à
--à A faster diminution of the Carrying Capacity of the Earth for our
(A POOR PLAN!)
The Opportunities Implicit in the Economic Crisis of 2008
“crisis” in Chinese is represented by two symbols. One means “danger”, and the other
intriguingly means “opportunity”. There
is profound wisdom in seeing a crisis as a potential good opportunity in a
context of heightened risk. Every crisis
presents us with a dangerous opportunity to learn the lessons that the crisis
reveals, and to act accordingly.
Unfortunately, entrenched interests are shrewd at exploiting
opportunities during times of crisis for their own narrowly self-interested
advantages, and they generally defend business-as-usual rather than supporting
The severe credit crisis that began in 2008
highlighted the obscene nature of extreme economic inequalities and increasing
barriers to upward mobility in the U.S.
This crisis contributed to a powerful people’s movement that had the
potential to help bring about needed reforms.
Significant peril accompanied this crisis because the forces of reaction
and entrenched power strive to spin circumstances to prevent fair-minded
reforms. The failure to heed the revelations of a crisis, after its
acute phase passes, can result in a greater risk of more serious consequences
in the future.
closely. A destructive earthquake
reveals that life-saving values embodied in sensible structural building codes
are vitally important. Hurricane Katrina
taught us that the destruction of wetlands on the Gulf Coast negatively
contributed to dramatic increases in vulnerabilities to the levee-protected
city of New Orleans. Tsunamis teach us
that warning systems in coastal areas can help prevent the loss of life in the
wake of powerful offshore earthquakes.
The BP oil spill in the deep waters of the Gulf of Mexico demonstrated
vividly that government regulations should not be formulated with so much
influence by corporate lobbyists, and that regulators should not be in bed with
representatives of the industries they regulate.
A back injury
caused by lifting heavy objects, or the onset of diabetes caused by a poor diet
and obesity, or a heart attack caused by eating too much high-cholesterol fatty
foods, or a car accident caused by texting while driving are all outcomes that
teach us lessons about the inadvisability of heedless behaviors. Likewise, sudden health adversities serve to
make us cogently aware of activities and habits that contribute to these
It is a terrible
shame for us not to learn the lessons that a crisis reveals. Consider the economic turbulence of the past
seven years. The cozy partnership of
government with business has created an anemic economic recovery from this
calamitous crisis, and yet most of our business and political leaders seem
hell-bent on obstructing wise and far-reaching reforms that would prevent a new
economic crisis or reduce our vulnerabilities.
Political partisanship, government gimmickry, greedy advantage-seeking,
and struggles for domineering power by ambitious and ego-driven individuals are
preventing us from responding to this crisis in ways that are more intelligent.
A number of
things make us more vulnerable to setbacks in the future that are potentially
more devastating for billions of people worldwide than what have been suffered
in the recent past. They include
inadequately regulated speculation, banks that are “too big to fail” and yet
are getting ominously bigger, our undiminished addiction to wasteful usages of
fossil fuels, and our reliance on irresponsible deficit spending and increases
in the national debt.
In the wake of
the Depression of the 1930s, bold corrective actions were taken to make our
economy fairer and more fiscally sound.
More egalitarian social policies were created to build a stronger middle
class. Labor relations reforms were
instituted. A protective wall was
created between depository banks and investments banks to minimize the
conflicts of interest between the goals of safeguarding the money of depositors
and risking it to make potentially big profits. These actions helped set the
stage for the United States to become more broadly prosperous for decades.
economics became fashionable at that time.
In the following 40 years, economic stimulus was applied when it was
needed during contractions of the economy, and then the proverbial “punch bowl”
was removed as economic activity heated up and economic expansions began to
cause spiking wages and prices and excessively wasteful uses of resources.
forces dominate our decision-making and threaten to make us drastically less
secure. We are like proverbial ostriches
that supposedly stick their heads in the sand to avoid perceived dangers. Even ostriches aren’t actually so
stupid! How could this state in human
affairs have come about? And how could
it continue to be so foolishly perpetuated?
Perhaps John Fowles was right when he observed in The Aristos that the more clearly we see
that our own individual deaths are inevitable, and the more clearly we see the
seriousness of the risks we are taking to our well-being, the more rash we
become in striving to get all the material things and sensual pleasures we can
get while we are able. Each of us at
least dimly realizes that, in all of eternity, there will be only this one
fleeting life to enjoy. As a result, we
are simultaneously both rational and irrational in excessively consuming goods,
and in over-indulging in eating and drinking, and in mindlessly exploiting
resources. This mindset is one of the main reasons we ignore the lessons
contained in a crisis. It is also one
reason why we ignore cautionary voices that advocate voluntary simplicity and
the wise recommendations of people who counsel moderation, ecological
intelligence, and greater fairness toward people in other generations.
the grand sweep of lessons learned from previous crises, it becomes obvious
that we should work together to find ways to re-structure our economic and
political systems so that every person becomes more responsible for their
actions toward others, and toward those in future generations. The Earth Manifesto contains an integral
assembly of dozens of ways for us to move in directions that are distinctly
more propitious. Read on! For a summary of specific proposals, see the
comprehensive compendiums of ideas in Common
Sense Revival -- Book One of the Earth Manifesto -- and in Part Four of
this manifesto online. These ideas
summarize many smart steps we should be taking to create fairer and more
It is common
sense that our primary goal should be to create the greatest good for the
largest number of people over the longest period of time. This utilitarian objective contrasts starkly
with our current tendencies to stimulate the opportunities for a small group of
hyper-privileged people to gain and maintain significant advantages at the
expense of all others over a myopic time horizon!
in Positive Directions
modern conservative is engaged in one of man’s oldest exercises in moral
that is, the search for a superior moral
justification for selfishness.”
--- American economist John Kenneth
As noted, business-as-usual policies that encourage
profligate consumerism are among the most serious shortcomings of our economic
and political systems. Such gambits may
help maximize short-term profits by allowing many costs, damages and risks to
be socialized, but that is a rationalization, not a smart plan. Bailouts are a mechanism by which bad
speculative risks are socialized and paid for by taxpayers or with borrowed
money adding to the huge national debt.
Some of the costs of doing business are socialized when big corporations
are allowed to evade the costs of pollution mitigation and clean up, and to thereby
foist them upon taxpayers and future generations. It is foolish not to require the costs of
things that harm people’s health to be included in the products and services
that cause the harm.
Subsidies, depletion allowances and tax loopholes
for special interest groups are other means by which costs are socialized. Future costs of environmental damages are
often socialized when vested interest groups are allowed to control
policy-making. We should instead implement
good governance plans. By inadequately
funding government, we fail to set aside “rainy day funds” that would provide
financing to deal with cataclysmic future costs that are being made more likely
by resource depletion, natural disasters, population growth, global warming and
related climate changes, species extinctions, and the potential for ecosystem
spending is an abused expediency by which we are obligating future generations
in order to facilitate profit-making for large corporations and rich people
today. It is important, parenthetically,
to accurately understand exactly what drives rapid increases in the national
debt. The primary causes of deficits
incurred from 2001 to 2009, according to the authoritative Center on Budget and
Policy Priorities, were NOT due to domestic government spending. The regressive tax cuts pushed by George W.
Bush accounted for 49% of the deficits;
the military buildup and wars, another 34%; increased entitlements, mainly the new 2003
Medicare Drug benefit with its generous provisions for big drug company
profits, 10% more. Just 7% was the
result of all nonmilitary spending, so it was actually only a trivial source of
the increases in federal deficits.
Obama inherited a fiscal emergency when he came into office in January 2009,
and record high levels of budget deficits were incurred in dealing with this
risky episode. The U.S. added more than
$1 trillion to the national debt every year for four years in a row from 2009
through 2012. Again it seems clear that
we should collectively strive to improve our societies by transforming them
with the cooperation of the principal deciders in our political system. We should demand that the most powerful
segments of our societies align themselves with socially responsible outcomes
and greater good goals. Instead, economic
elites in our society are often allied against such goals. The guardians of the status quo must be given
much more powerful incentives to align themselves with the common good and the
best interests of the people.
Our economy is currently structured so that good
citizen goals are somewhat contrary to the interests of the segments of society
that have the most power. Professor
Robert Reich articulates this concept clearly in his aforementioned book, Supercapitalism, pointing out how
dysfunctionality in our societies today is being caused partially by allowing
consumer and investor goals to be paramount while good citizen goals are given
a distinctly lower set of priorities.
This is the opposite of what should be done for a saner and
A redesign of our economic system is required. I harken back to the brilliantly sensible
author and businessman Paul Hawken, who wrote these simply visionary words in The Ecology of Commerce: “We must design a system … where doing good
is like falling off a log, where the natural, everyday acts of work and life
accumulate into a better world as a matter of course, not a matter of conscious
altruism.” Think about this revolutionarily simple and marvelous idea!
The Earth Manifesto essay The Common Good, Properly Understood provides a clear synopsis of
the varying goals we all have as consumers and as investors, along with the
contrasting goals we have as good citizens who want things that are consistent
with the common public good. If we were
to choose to revolutionarily restructure the current state of affairs by
altering the rules that encourage “tragedy of the commons” outcomes, we would
discourage harmful impacts on other people and the environment. This would be more advantageous than to
continue foolishly encouraging outcomes that are proving to be demonstrably
Adverse outcomes arise, in general, from
two categories of harmful impacts:
social harms and ecological harms.
Negative social impacts of our current economy include those activities
that cause inequalities to increase between people, and activities that
destabilize the economy, and activities that serve to financially mortgage the
future and harm the aggregate well-being.
Negative ecological impacts include the degradation of wild lands and
ecosystems, the pollution of streams and lakes and oceans, the wasteful
depletion of resources, and the spewing of unprecedented and growing quantities
of greenhouse gas emissions into the atmosphere that alter global weather
patterns. These activities are driving
many species of life to extinction and reducing the biological diversity on
Earth by altering habitats, polluting the commons, introducing many toxic
wastes into the environment and diverting fresh water sources.
Some say we are like sleepwalkers shuffling toward a planetary
ecological disaster. So here’s
a bold plan. To align the most powerful
interests in our society with good citizen goals, we should alter the rules in
our economies in two vital ways. First,
we should enact a Social Justice
Taxation Act that will make fair revisions to the U.S. tax code that would
ensure taxes are more progressively structured.
Second, we should enact a five-year plan to balance the federal budget
by giving the primary deciders in our economic and political systems powerful
motivations to achieve balanced budgets.
The details of these two proposals are contained in One Dozen Big Initiatives to Positively Transform Our Societies.
Seven Proposals to Align
Costs with Responsibilities
One of the core ideas in the Earth Manifesto is
that we should collectively take effective steps to make sure that all costs
incurred in making products, or in providing services, are included in the
prices of the corresponding goods and services.
By making such changes from our current jerry-rigged system, we would
allocate costs properly to where they are incurred and where they should be
reflected. This change would limit the
socially undesirable “privileges” currently enjoyed by people and businesses
that are being allowed to externalize costs upon society as a whole.
Here are 7 specific plans to fairly and
providentially accomplish this smart goal.
They would do this by shifting incentives and disincentives to more
proper priorities. These seven changes in policy would probably have
a regressive effect, in the sense that they would have a greater adverse
financial impact on poor people and the middle class than they would have on
wealthier people. In recognition of this
fact, taxes should simultaneously be reduced equally for every taxpayer to
partially offset this inegalitarian affect.
The fairest and easiest way to do this would be by increasing the
Standard Deduction exclusion of income from taxes on everyone person’s tax
return. Here are the proposals:
First, since more than 400,000 people die each year as a consequence of
tobacco use, and since more than 8 million people suffer
from at least one chronic disease due to having smoked cigarettes, the medical cost of treating these people
should be borne by those who buy and use tobacco products, not by everyone in
the general population. We should assess
additional taxes on tobacco products to pay for these healthcare costs. Startlingly, the influence of Big Money
obstructs such an initiative. It
is surprising how dramatically public opinion can be influenced by political
advertising and other forms of slick propaganda. Large amounts of money spent on political ads
can easily manipulate people, as was demonstrated by the defeat of Proposition
29 on the California Ballot in June 2012.
This initiative would have assessed an additional $1 per pack on
cigarettes, with the revenues raised to be used to fund medical research into
tobacco-related diseases and programs that discourage tobacco use. This initiative enjoyed a commanding lead in
polls earlier in the year before the election, but then big tobacco companies
spent almost $50 million on a deceptive advertizing blitz, and the outcome was
a very narrow victory for tobacco industry profiteering over the health and
well-being of the people.
Second, alcohol is
responsible for the deaths of more than 100,000 people each year. The costs of alcohol-related afflictions
should be paid for by those who drink beer, wine and hard liquor. Higher taxes on alcohol should be imposed to
raise money to cover these costs. These
increased duties would also serve to reduce the abuse of alcohol and the sheer
amount of adversities suffered as a result of excessive consumption of alcoholic
Third, obesity is
estimated to be responsible for more than $150 billion in health care costs
each year. More than half of this total
cost is paid by taxpayers through programs like Medicare and Medicaid. The most significant contributing factor to
this cost is excessive amounts of saturated fats, processed salt, refined
sugars and chemical preservatives that are contained in fast foods. A surcharge on all sales of fast foods should
be implemented to cover these obesity-related costs.
Fourth, the cost of
health damages and crop losses caused by air pollution are estimated to exceed
$100 billion in the United States each year.
Half of this air pollution is caused by motor vehicle emissions. Those who contribute to this problem should
pay for these costs. To achieve this
goal, a provision for these externalized costs should be included in the price
of gasoline. Americans drive about 2
trillion miles each year, in total, using more than 100 billion gallons of
gasoline, so an increase in gasoline taxes of $.50 per gallon would cover this
half of the externalized costs. The
other half of the air pollution is caused by industries like those that
generate electricity by burning coal, oil and natural gas. Again, costs should be included in the
processes that are responsible for generating them, so these industries and all
electricity users should be required to pay for them instead of allowing these
costs to be indiscriminately foisted upon everyone, regardless of how
conservation-minded they may be in their uses of electricity.
Fifth, the costs of
natural disasters in the past 10 years have averaged more than $30 billion per
year. There have been wide swings in
such costs due to epochal events like exceptionally damaging hurricanes and
periodic storms, floods, droughts and wildfires. All these events are being caused with
increasing frequency because of climate disruptions associated with greenhouse
gas emissions. A national carbon tax
should be instituted, with proceeds used to create a ‘rainy day fund’ that
covers these costs. This would establish
a direct correlation between the primary contributors to global warming
emissions and those who pay for the consequences. Some of the funds generated from these taxes
should be used to finance a necessary ‘green transition’ to a cleaner energy
Sixth, tens of thousands
of people are killed or injured every year through the use of handguns or
assault weapons. The related cost of
emergency room visits and law enforcement and court costs should be covered by assessments
in the price of all sales of guns and ammunition.
Seventh, the total cost of the U.S. Army, Navy,
Marines and Air Force, and of military occupations, armaments, domestic
homeland security, and intelligence gathering is somewhere around $1 trillion
every year. This huge cost is beneficial
to industries and investors that are part of the military-industrial
complex. A portion of this cost should
be covered by taxes on the primary beneficiaries of wars, like armaments
manufacturers and Big Oil companies, instead of allowing these costs to be
foisted on all Americans and all people in future generations. Military interventions in the Middle East in the past 25 years have
cost trillions of dollars, and these aggressive actions have been directly
related to our being addicted to oil, so it would be only fair to partially
finance such military adventurism with a tax on oil imports. The premise,
once again, is to sensibly raise revenues from products, services and
undertakings that are directly responsible for the costs being incurred.
The Inauspicious Expediency of
Out-of-Control Deficit Spending
The most insidious way that costs are being
externalized onto society and people in future generations is by the popular
but fiscally irresponsible NO-WAY-WE-WANT-TO-PAY-AS-WE-GO tactics of the past
15 years. This is a modern form of the
‘tragedy of the commons’ in which we borrow gigantic sums of money from people
in the future to avoid making the difficult decisions that would be required to
actually balance the budget. If we did
not indulge in this risk-laden expediency, we would be forced to squarely face
the need to cut things like military expenditures and the compensation and
benefits paid to federal government employees and the cost of entitlement
programs AND at the same time to increase revenues by reversing a portion of
the overly generous tax cuts that Ronald Reagan and George W. Bush have given
to wealthy people and large corporations in the past few decades.
Modern societies have serious problems that tend
to get worse as nations become more populous.
Financially successful segments of every society are composed of people
who have benefited the most from the ways the economic system is
structured. These are the people who
gain outsized benefits from law and order and strong military forces and low
taxes on capital gains, and from public investments in education and
infrastructure. They are also the
primary beneficiaries of provisions that encourage resource exploitation and
cost externalizing scams and the concentration of wealth.
Considering these facts, it is sensible and
fair to require well-to-do people to shoulder a greater share of the tax burden
required to maintain our civilization.
It is, in fact, the only practical thing to do. It is also the only morally responsible way
to make a society work more fairly. This
leads again to the conclusion that a more progressive tax structure is needed
in which everyone pays the same amount of taxes on all levels of earnings, and those
who earn higher levels of income pay higher marginal tax rates on higher levels
Understand how eminently fair progressive
taxation turns out to be. Every taxpayer
essentially pays the same rate of tax on every dollar they earn. A person earning $1 million a year in “ordinary
income” pays exactly the same amount of tax on their first $50,000 as a person
making only $50,000. The big exception
to this is one that favors wealthy people who make money on capital gains, for
our U.S. tax system generously allows them to pay much lower tax rates than
Tax policy in effect
provides a reflection of our social values and moral stances. The design of tax policy has far-reaching
consequences, so this issue is not merely some arcane accounting matter. No one particularly wants to pay taxes, and
many people today are angry at having to pay them. This anger has been shrewdly channeled into a
retrogressive agenda that allows taxes to be shifted from those who can most
easily afford to pay them, i.e. the highest earning and wealthiest Americans,
to other people and to all people in future generations. This is pure scheming genius by the ruling
class. In the long run, however, it is a
form of class and intergenerational treachery that undermines the prospects,
health and well-being of all Americans.
The era of taxing capital at lower rates than labor should now end,
contends billionaire financial manager Bill Gross. He recommends that even rich people should support taxes on capital gains and hedge fund
managers’ “carried interest” earnings that are as high as existing marginal
income tax rates. In other words, taxes
on hedge fund profits and capital gains should be almost 40%, not just a mere
15%. Higher marginal tax rates would
help reduce wealth inequality, and they would also stimulate
broad-based economic growth.
It seems obvious that higher marginal taxes on the
2% of people who earn more than $250,000 per year, coupled with unchanged taxes
on everyone else, should be supported by a 98 to 2 vote in a democracy that functioned
rationally and properly. But those with
the most money control our political system and the bullhorns of ideological
spin, so we seem to be practically incapable of altering our tax system in this
fair and sensible direction.
Nonetheless, our political leaders must find a way to make our tax
system fairer sometime soon.
Congress should also pass a bill like the Stop Tax
Haven Abuse Act proposed by Senator Carl Levin, in order to control “offshore
secrecy jurisdictions” and money laundering schemes. This would result in the collection of an
estimated $100 billion each year in revenues from tax-evading corporations and
high-income individuals who use sophisticated gimmicks to avoid U.S. taxes.
A Giant Pool of
follows a long and winding road of historical perspectives and insights. Right now we’re rounding a corner and seeing
economic developments taking place that force us to realize that Big Picture
understandings are urgently required.
Let’s start by considering “The Giant Pool of Money.”
This American Life, a National Public Radio
show, presented a compelling discussion in 2008 about a giant pool of money,
estimated to total about $70 trillion at the time around the world. This money figuratively prowls the planet seeking
good investment returns. During boom
times, this pool of savings seeks high returns, but during economic downturns
the people who control this money are much more obsessed with the safety of
principal. This pool of money is
generally invested in the five primary categories of assets: stocks, bonds, real estate, businesses, and
planners, incidentally, say that the best plan for any individual is to avoid
putting all of your eggs in only one basket, and to thus make a balanced allocation
of assets among these classes of investments.
This strategy results in gains in one category that will offset losses
incurred in others. Stoic discipline, it
seems, is required to stick with such diversification strategies in the face of
dramatic volatility in the stock market and gold prices, and in currency and
interest rate fluctuations and heightened international economic and
This giant pool
of money got burned by the mortgage-backed securities debacle of
2007-2009. Bond portfolios have done
well in recent years due to low interest rates, but eventual higher interest
rates will create bigger risks even in bonds.
Investors realize that nations worldwide have been pursuing fiscally
irresponsible monetary policies that will eventually lead to higher
inflation. These factors create their
own set of winners and losers, and they carry a variety of financial
The U.S. national
debt has skyrocketed in the past 15 years, and the percentage that this debt
represents relative to the GDP has increased radically. Fifteen years ago, federal debt was 35% of
GDP, and in 2012 it exceeded 100%. It is
madness to allow this to happen. How and
why is this taking place?
Usual: Courting Economic and Ecological Calamity
mocks us. First, the U.S. Senate refused
in early 2010 to create a commission to look into the shortsighted expediency
of record levels of deficit spending and the ongoing rapid increase in the
national debt. So President Obama,
recognizing our national avoidance of the tough choices required to solve
daunting fiscal problems, issued an executive order in February 2010 to
establish a National Commission on Fiscal Responsibility and Reform. We do, after all, have an overriding need to
honestly examine the expediently popular but extremely irresponsible tactic of
mortgaging the future for short-term benefits.
Deficit Commission spent 9 months struggling to come up with a comprehensive
set of proposals to deal with the growing national debt. Ideologies clashed, and vested interest
groups practically gnashed their teeth in their efforts to influence the
purportedly “bipartisan” commission to get it to sacrifice everyone else’s
sacred cows rather than their own.
Finally, when the Commission submitted its sobering proposals, they
included a conflict-of-interest-generated, counterproductive and lame-brained
idea of cutting taxes on rich people and corporations, which would most likely
serve mainly to make deficits worse.
There was preposterously
little in the report about providing powerful incentives to corporations for
them to stop exporting millions of jobs abroad.
There was little about investing in higher education or research and
development, or helping build a green economy, or undertaking a modernization
of our crumbling national infrastructure -- even though such plans are
essential to the maintenance of our competitiveness and the creation of a
stable foundation for healthy economic growth.
And the Commission did not give adequate consideration to broader
factors that affect deficit spending like regressive tax policies, the
climate-disrupting impacts of unlimited emissions of greenhouse gases into the
atmosphere, or the adverse impacts of rapid global population growth.
The biggest irony
of all came just a few days after the Commission submitted its
recommendations. Our political leaders
chose to completely ignore the Commission’s recommendations! Instead, they rejected common sense and again
resorted to embezzling money from future generations by compromising amongst
themselves to continue the highly regressive Bush tax cuts for all Americans
for two more years until the end of 2012.
These tax breaks primarily benefitted millionaires and billionaires who
gained extravagantly from this action.
This decision alone was expected to add a whopping $858 billion to the
national debt. And by extending the Bush
tax breaks that are so heavily tilted toward the rich, one of the best options
was temporarily eliminated to honestly deal with our deficit spending and
national debt problems. This
shortsighted strategy crippled the potential for positive efforts to invest
more money in solving many other daunting challenges that we face.
What this action
really did was to compromise the hopes and potential prosperity of people in
the future in order to avoid making the difficult decisions we really should be
making today. This was a compromise made
behind closed doors between President Obama and Mitch McConnell, and it
violated one of the idealistic visions that the president had been elected to
pursue. “We lose ourselves when we
compromise the very ideals that we fight to defend,” Mr. Obama had stated early
on. “And we honor those ideals by
upholding them not when it is easy, but when it is hard.” Oops!
collectively risking the financial stability of our nation by refusing to
courageously deal with the true implications of this dangerously undisciplined
deficit madness. We are risking an
eventual devaluation of the U.S. dollar by the irresponsibility of our fiscal
and monetary courses of action. We are
also sowing the seeds of another possibly even more severe economic crisis than
the one that our leaders helped create in the past decade. This is recklessly imprudent!
The extension of
the Bush tax cuts allowed rich people to continue to pay historically low rates
on their incomes and capital gains and dividends, and on their estates after
they die. This gambit is a form of
intergenerational treachery. By
mortgaging future generations, we are compromising their potential prosperity
simply so that rich people can become richer today. This is prolonging the trend toward an
ever-more extreme concentration of wealth.
It is also increasing inequities and exacerbating the economic insecurity
of the vast majority of Americans, and it is undermining our democracy in the
process. The decision to give two more
year’s worth of this multi-trillion-dollar folly to rich people was
irresponsible, and to the extent that it crowded out financing for important
social and infrastructure and environmental priorities, it was pathetically
Once again it can
be seen that Big Picture perspectives and overarching guiding principles are
sorely needed to create a higher level framework for formulating public
policies and making national decisions on spending and taxation. This is another reason we should establish
and follow the guidance of a Bill of Rights for Future Generations. This commitment should be debated and
developed and passed and ratified in the U.S. as soon as possible -- and in
the face of the myriad ways we are fleecing the future with our profligate
consumption, resource depletion, pollution, habitat destruction and climate
disrupting activities, our collective complacency toward budget deficits is
obscene. These myopic expediencies
reflect a selfish, undisciplined and weak-willed inability to make difficult
choices that would be fairer to our descendants.
Human nature is
quite resistant to change, but our habits and behaviors can quickly be modified
with attractive incentives and dissuading disincentives, so it is high time we
make better use of these Pigouvian tools to create more responsible societies.
An Aside on the
Partisan Intransigence of the “Super Committee”
“Super Committee” of politicians was established in August 2011 and given the
task of coming up with ways to reduce the large additional budget deficits that
were projected to be incurred in the next 10 years. After trying for three months, this committee
abjectly failed to find a compromise on reducing deficits. This failure of the political class reflected
the corruption in our political system.
Conservatives arguably took the most outrageous stance in these
“negotiations” by sticking to their absolute opposition to increasing revenues
or eliminating tax loopholes.
a Republican debate between presidential candidates in 2011, all of the
candidates were asked if they would accept a deficit reduction deal that would
include ten dollars in real spending cuts for every one dollar in
revenue increases. Every single
Republican candidate declared they would refuse to accept any such deal. Ten times!
Recent times have obviously not been good years for reasonable people.
need not be a particularly keen observer to realize that the $10 trillion in
additional deficits that were projected at the time to be incurred in the next
decade could not fairly and adequately be reduced without both additional
revenues and spending cuts. Sacrificing
the security and well-being of tens of millions of Americans to protect
generous perks for the top 2% of Americans who annually earn more than $250,000
is not a practical or sensible plan.
Dismantling the social safety net and making education and health care
more expensive for people is shortsighted.
So is the idea of cutting funds necessary for those who are first
responders to emergencies. And those who
advocated that we should fund disaster relief programs only by cutting other
government spending are heartlessly inflexible.
Proactive planning would be a much better idea -- let's establish a
well-funded Disaster Insurance “rainy day fund” for inevitable natural
disasters events! A Pigouvian tax on
carbon emissions would be a bona fide appropriate way to help finance this
A Digression on Rich Kids’ Inheritances
have a bottle of your tawniest Port.”
--- Vinnie del Mar
Roosevelt indicated in a remarkable speech 100 years ago that he strongly
believed in “a graduated inheritance tax on big fortunes, properly safeguarded
against evasion and increasing rapidly in amount with the size of the
estate." Inheritance tax plans
should be instituted that are consistent with this idea, instead of giving away
the farm and figuratively fiddling while
One would think
that the schizophrenic status quo of estate tax law would have put a hot burner
under our leaders in the year 2010.
After all, the Bush administration’s regressive tax cuts that favored
rich people finally chipped away at taxes on rich kids’ inheritances so much
that what was 55% on all inheritances over $675,000 in the year 2000 had been
reduced to 45% tax on amounts inherited over a much larger $3,500,000 exclusion
in 2009, and then ZERO TAX on all inheritances from people who died in
2010. Estate taxes would have reverted
to 55% on all inheritances over $1 million in 2011, but the Obama/McConnell tax
“compromise” in December 2010 gave rich people an outlandish $5 million tax
free exclusion for each parent, and then it taxes inheritances at a rate of
only 35% on amounts in excess of these high exclusions.
governmental gimmickry is a lamentable result of undue influence by moneyed
interests. It is distinctly unethical
gamesmanship in action. We need a system
of taxation that is more progressive, and we need greater social fairness and
smarter national planning!
It is crazy to
have allowed the less than 1% of people who have a net worth large enough to be
subject to any estate tax at all to have gotten off ‘scot-free’ if they
died in 2010. Our budget deficits are
too big to allow rich people to continue to pay historically low tax rates on
their estates after they die. Our
representatives should courageously and honorably address this issue. They should also act to close tax haven
loopholes. All these things, together
with more steeply-graduated tax rates on incomes and capital gains, are needed
to help satisfy smarter national priorities and needed social programs, and to
slow the growth of our irresponsibly accumulating national debt. STAND AND DELIVER!
applies particularly to scheming Republicans, who have made so many of our
national problems worse in the years since 2001. They have stubbornly obstructed almost every
effort being made to solve the serious challenges we face since President Obama
was elected. Their overarching goal has
been to make the President fail, no matter how adversely such efforts affect
the majority of Americans. Republican
politicians gained traction and political power in the national elections of
November 2010 and 2014, though their overreach and economic sabotage was
disadvantageous to the country. The
perversely single-minded Republican obsession with power and domination has
come at a terrible cost to tens of millions of Americans, and to all people in
the generations to come. This is
unacceptable. STAND AND DELIVER!
Parenthetical Observations Concerning President Obama and Republicans
Television host and
political satirist Bill Maher once wondered aloud in a TV editorial what
exactly Barack Obama had done that has made conservatives so angry. Why did Republicans such as Michele Bachmann,
John Bolton and Newt Gingrich call President Obama the most radical president
in history? In terms of federal
spending, his administration has had the smallest increase in decades. Bill Maher, giving this fair consideration,
noted (in 2012):
”If Obama were as
radical as they claim, here’s what he would have already done: pulled the
troops out of Afghanistan, given us Medicare for all, ended the drug war, cut
the defense budget in half, and turned Dick Cheney over to the Hague.” … “How
can you guys be so unhappy with Obama when I’m so unhappy with Obama? You think you got coal in your stocking? I wanted single-payer health care, a carbon
emissions bill, gun control, and legalized pot.
If you get to carry around all this outrage over me getting that shit,
shouldn’t I have gotten it?”
“Now, it somehow became
an article of faith on the right that Barack Obama is the most extreme
President in American history. Although,
when they say that, I think what they really mean is: <He’s black.>”
The element of racism in
conservative circles is hard to deny.
Conservatives blamed President Obama for persistent high levels of
unemployment, yet they have cynically done everything in their power to ensure
that he does not succeed in reducing joblessness. A funny greeting card in 2010 revealed deeper
truths: it has a picture of George W.
Bush on it, and a caption below it reads:
“I Screwed You. Thanks for
Blaming it on the Black Guy.”
Make no mistake about
it: there is all too much racism,
bigotry and structural socioeconomic stratification in American business and
society, but this is by no means the whole story of the intense anti-Obama
sentiment in conservative circles.
History is proving that Bill Clinton was a good president who actually
succeeded in running a federal budget surplus in his last year in office, and
yet the attitude of the right wing toward him was veritably supercharged with
vituperative animosity, as evidenced by the drawn-out attempts to impeach him
and cripple his presidency for his sexual improprieties with Monica Lewinski.
The shrill anger of far
right conservatism toward anything liberal has been hyped up using propaganda
that manipulates public opinion and agitates people to the point that millions
of poor Americans are deluded into opposing their own economic self-interest
and the common good, and they vote in support of the corrupt agenda of
billionaires and ideological extremists.
This is the crux of what the matter is with the U.S., according to historian Thomas Frank in
his book What’s the Matter with Kansas.
The entire 2016
Republican primary competition has been like a string of must-watch bad
episodes of unreal Reality TV, replete with puerile allegations and insults in
many debates and an excess of harsh invective on the campaign trail. Bile and hatred toward President Obama and his family has been ratcheted
up by Republican candidates for president during the extreme right wing
dominated campaign for the nomination. One big factor in this
political ugliness is Donald Trump's racially charged rhetoric and a
conservative consensus that "political correctness" is too
restrictive in talking about immigrants and minorities. But Trump's
violence-tinged rallies seem to have given an angry strain of white male
Americans a "license to hate out loud", and that often has profoundly
It is easy to
see good reasons for conservative Americans to despise our democratic system,
for it can really be inconvenient to be forced to put up with other people and
their precious rights, and boy, it can be downright aggravating when there are
too many moochers getting benefits like unemployment insurance, food stamps or
subsidized medical care, and for that matter, huge tax breaks, extraordinary
encouragements to engage in legalized bribery, corporate boondoggles and
generous incentives to socialize costs, stratospheric CEO pay that is tax
deductable, or scandalously low tax rates on “carried interest” incomes of
hedge fund managers.
One of the
biggest risks for Republicans for having chosen Trump as the presumptive
Republican nominee is that he defines the party as one of white backlash in the
eyes of growing populations of Millennials and racial minorities. “That’s the great danger -- that he defines
what the Republican Party is in the 21st century, and because of the
demographic trends that is toxic,” said long-time GOP strategist Whit Ayres,
the chief pollster for Marco Rubio. “We
are on a precipice here, particularly with the Hispanic folks. The danger
is we could have Hispanic voters locked into the same voting patterns as
African Americans. If that happens we will never elect another Republican
president.” This seems especially true after Trump’s combative response
to violence that has surrounded his campaign.
It appears that
God has actually been hardening the hearts of Republican politicians for years,
but the LORD has really amped up His jealous anger in this Pharaoh-selecting
Republican primary season. God even seems to be getting ironical in His
advanced age, for ‘He’ suddenly took Supreme Court Justice Antonin Scalia’s
life at a real inconvenient juncture, forcing Republican leaders in the Senate
to refuse to fulfill their Constitutional responsibility to consider his
replacement, and to concoct bizarrely disingenuous and dishonest rationalizations
for their stubbornness.
The Senate has
never taken more than 125 days to fill a vacancy on the Supreme Court, but now
Republican Senators are dragging out the process for almost a year. They
preposterously claim that they want to give the people a voice by waiting until
the next president is chosen and President Obama is no longer in office, as if
the American people will suddenly become single issue voters and choose the
next president according to whether or not they want another ideological conservative
on the highest court in the land. To be honest, if we really want the
people to weigh in on this particular issue, we could ask them right now, and
be done with it. Polls conducted on this issue consistently show that a
significant majority of the American people think Senators should do their job
as specified by the Founders in the Constitution -- by giving President Obama's
eminently qualified and reasonably centrist nominee
really is pretty amazing that the unexpected vacancy on the Supreme Court
caused by the sudden death of ideologically conservative Antonin Scalia has
resulted in such a vicious curveball being thrown into the cauldron of American
politics. This development has cast
partisan arguments about his replacement into stark relief.
Senators are aghast at the realization that their success in stacking the
American federal courts with conservatives who will allow moneyed interests to
blatantly corrupt our national decision-making and democratic processes has suffered
so serious a setback. Their staunch
refusal to fulfill their Constitutional duties to consider a replacement is
facing contradictory and almost farcical headwinds, for the majority of the
American people see how deeply disingenuous and dishonest this obstruction
really is. Republican claims that the
people should be allowed to decide by waiting for the results of the
presidential election in November are preposterous, for that vote will involve
dozens of issues, not just this one.
“There’s a reason beyond garden-variety partisanship that
Senate Republicans resist even holding hearings on President Obama’s nomination
of Merrick Garland to the Supreme Court.
Their gambit evades a full and open debate over the conservative
judicial agenda, which is to use the high court in an aggressive and political
way to reverse decades of progressive legislation.”
--- E.J. Dionne Jr. of the Washington Post Writers Group
A central irony of accusations by conservatives that
liberals use "judicial activism" is that, in actuality, they are the
ones who are now staunch judicial activists.
“It's precisely because Merrick Garland's record reveals him to be a
devout practitioner of judicial restraint that an intellectually frank dialogue
over his nomination would be so dangerous to the right. It would expose
the radicalism of their jurisprudence."
Dionne Jr. astutely points out that the narrow 5-4 majority of conservatives on
the Supreme Court before Antonin Scalia’s death were responsible for the Citizens United ruling that overthrew
decades of precedent and a century of practice involving limits on the power of
big money in politics, as well as the Supreme Courts evisceration of the Voting
Rights Act. He also points to rulings in
which the Supreme Court scrapped “all manner of legislation aimed at protecting
workers’ rights, the environment and consumers.
Historically, it’s an approach that, more often than not, leans toward
employers over employees, creditors over debtors, property owners over less
affluent citizens, and corporations over individuals.”
provocatively concludes: “At heart, this
is a debate over how we define democracy.
It’s also a struggle over whether government will be able to serve as a
countervailing force to concentrated economic power.”
"EQUAL JUSTICE UNDER LAW". These words are written above the main
entrance to the Supreme Court Building in Washington, D.C. They express the ultimate responsibility of
the Supreme Court to ensure the American people the promise of equal justice
under the law. When federal courts are
stacked with conservatives, there is no equal justice for the people.
impartiality rules are needed in our judicial system. A judge must have the freedom to decide cases
based on the facts and the law -- not based on public opinion or the views of
special interest groups or even a judge’s own personal beliefs. It is a cornerstone of our democracy to
guarantee the right to every citizen of a fair trial and fair-minded rulings.
Without judicial independence and impartiality, this right is
American Bar Association created a Commission on the 21st Century Judiciary to
study how to ensure fairness and impartiality and accountability in state
judiciaries. The hearings focused on
recent developments in the states that have politicized the judiciary. Members of the commission made
recommendations in their 2003 report titled Justice
in Jeopardy, emphasizing the importance of the rule of law, judicial
independence and impartiality, integrity and qualifications of judges, and the
need to demographically reflect society, along with the importance of public
faith and confidence in the judiciary.
of the biggest dangers may be that conservatives will gain domineering power in
our society and then seek authoritarian dominance over the people, and it could
be “goodbye freedom”. Right-wing extremism can be
remarkably patient, noted Steven Weber.
"That is, until it makes its move, and then it is sudden and
explosive." Let’s stop them from
achieving this goal. Dump Trump!
there were 70 percent fewer polling places during the 2016 presidential primary
elections than in 2012 in the county where Phoenix, Arizona is located. Terribly long lines resulted, and many voters
were forced to give up trying to vote.
Officials wouldn't have been allowed to eliminate all those polling
places if the Voting Rights Act had not been gutted in a 5 to 4 vote by
conservatives on the Supreme Court.
of dollars are being funneled into our elections in a form of legalized
bribery, even as American voters -- especially minority voters -- are being
discouraged from voting. It is no wonder that government no longer works
for ordinary Americans. The
real intent of voter ID laws like those passed by Governor Walker and his
Republican colleagues in Wisconsin is not to prevent voter fraud, but to
prevent certain voters from voting.
state legislatures introduced prohibitive measures to restrict the right to
vote after the Supreme Court ruled in 2013 to gut crucial sections of the
Voting Rights Act. But in Oregon, Governor Kate Brown signed a
commendable first-in-the-nation bill to automatically register all eligible
Oregonians to vote when they obtain or renew a driver’s license or state
identification card. Once the law went into effect, it has been
successful in registering many more people to vote, which is a desirable goal
in our democracy. Let’s act to make it
easier to vote in each and every one of the 50 states!
"Independence is my happiness, and I view things as
they are, without regard to place or person;
my country is
the world, and my religion is to do good."
--- Thomas Paine
Inequity Is Revealed
substantial inequity is being created in our economy that is markedly unfair to
retired people and those who save money.
In response to the economic turbulence of recent years, the Federal
Reserve has reduced interest rates to the lowest levels in 50 years. The purpose of this strategy has been to
stimulate the economy by encouraging borrowing, spending, investments,
risk-taking, and real estate speculation.
This policy, in effect, causes a massive wealth transfer from savers to
borrowers. This is a current outcome of
the “financial instability hypothesis”
that Hyman Minsky described when he noted a cyclical progression in banking
from safe lending practices to more intense competition to a speculative bubble
frenzy of “Ponzi finance.”
low interest rate policies now in effect constitute an estimated $350 billion
annual penalty to savers and retired people.
The benefits of this policy go primarily to banks and investors rather than
workers and common folk. Banks make
profits by leveraging the spread between the cost of funds and the charges they
make for loans, so banks are primary beneficiaries of this policy, and banks
never give borrowers the full benefit of reductions in their interest costs.
coming after a devastating financial crisis caused by companies and households
that feasted on borrowing, ultra-low interest rates are now penalizing people
who have paid down their debt and are trying to save. It is also punishing those who rely on the
proceeds of their nest eggs to pay the bills.”
Feast At the Expense of the Frugal”, Graham Bowley, New York Times, 9/9/10
Conflicting Goals of Consumers and
Investors and Good Citizens
government policies are practically schizophrenic in the way they treat
competing interest groups in our societies.
These policies generally encourage overproduction and over-consumption,
and not conservation or efficient uses or sensible allocations of resources.
The 2008 Farm Bill, for instance, was
typical of poorly prioritized and misguided government policies. The first Farm Bill had been enacted during
the Great Depression to protect farmers against low crop prices and the
environmental disaster caused by the devastating drought during the Dust Bowl
of the 1930s. Unfortunately, the Farm
Bill has evolved into a massive subsidy program that mainly benefits large farm
corporations, even when food prices and corporate agribusiness profits are
high. It is curious to see how life
preservers that are thrown to the most vulnerable people in our society almost
always eventually end up being grabbed by people who are the most affluent and
best connected. There is ostensibly no
‘women-and-children-first’ chivalry here!
In The Omnivore’s Dilemma, author Michael
Pollan delves into the patchwork insanity that has evolved from early efforts
by the federal government to help small farmers who were severely affected
during the Depression by low crop prices and related losses of millions of
family farms. As seems to be the
inalterable nature of our skewed and screwed-up political system, powerful
special interests have exploited the Farm Bill to pervert it into a misguided
misallocation of taxpayer funds.
The net effect
of Farm Policy is to subsidize the vast overproduction of a small number of
crops like corn and soybeans. Farm
Policy also encourages a monoculture system of agriculture that is favorable to
giant agribusiness corporations.
Undesirably, monoculture crops are much more vulnerable than more
diverse crops. Industrial agriculture
systems are dependent on the extensive use of chemical fertilizers, pesticides,
fossil fuels, and capital-intensive mechanized planting and harvesting. A sad side effect of these policies is to
drive many small farmers out of business.
Another consequence is that innovations in marketing and technology are
developed that unwisely stimulate overconsumption of the food stuffs that are
consequences of this industrial Farm Policy are far-reaching, and in many ways
insensibly foolish. The most serious
impact that comes to mind is that we have, to an unprecedented extent, become a
“fast food nation” in which obesity has basically become a costly national
Let’s shift our
frame of reference concerning the proper role of the federal government in our
national policies. The government is
neither categorically bad, as the Tea Party crowd alleges, nor is it always
better than poorly managed laissez-faire capitalism, as more liberal-minded
people believe. Neither unregulated
private business activities nor rapid growth in federal government involvements
in our economy are ideal. And no
collaboration of Big Government and Big Business is acceptable if it serves to
maximize private profits while allowing many costs to be socialized. A better, more proper, more providential
balance is clearly required than the status quo.
When vested interests like banks and large
corporations socialize costs to increase private profits, this is a form of
“socialism for the rich”. This form of
socialism is more unfair, distorting and costly than entitlement “socialism”,
which social conservatives rail about with increasing fervor these days.
Passionate arguments are made about an “invisible hand” of self-interest
that guides aggregate outcomes toward the greater good. Some people, like the philosopher/novelist
Ayn Rand, propagated spin about the nobility of heroic industrialists. But a simple fact remains: whether or not one fervently believes that
governments should have less involvement in the economy and people’s
lives, or more responsibility and involvement, a deeper understanding of
unintended consequences and more intelligently-prioritized principles is needed
to ensure that our societies become economically stronger, fairer, more
ecologically sound, and more likely to be sustainable. There is a kernel of truth in every good
argument, but this does not mean that the conclusions people reach are
necessarily valid. We need to find the
A Perspective on Those who Oppose Ideas
Americans have been
dishonest enough with themselves to allow anti-tax ‘conservatives’ to succeed
in getting taxes reduced to multi-generational lows for people with the highest
incomes. We have effectively bought the
story that cutting taxes will result in a shrinking of the size of the federal
government. The simple fact of the
matter is that tax cuts have not even once resulted in less government spending
in the past 50 years. Instead, tax cuts
have consistently contributed to large increases in the national debt.
One consequence of
deficit spending is a large “debt tax”.
This is the amount of interest expense incurred every year on the
national debt. Since our national debt
now exceeds $19 trillion in April 2016, this creates a national vulnerability
to a new episode of financial crisis. We
should face this fact and remedy the insidious risks created by such fiscal
Anti-tax ideologies have
crimped the budgets of state and local governments, and forced cutbacks in
education, public services, law enforcement, first responders, court staffing,
oversight of businesses by government agencies, and the maintenance of open spaces,
State Parks, wilderness areas and our beautiful national parks. These outcomes are deleterious to millions of
people. A better balance is needed in
our efforts to control government spending without crippling the many good and
necessary functions that governments serve.
The federal government’s
efforts to stimulate the economy have alleviated the danger that would
otherwise have prevailed if severe cutbacks in government spending and
employment had been made during the credit crisis of 2008-2009. The 6% annual rate of economic shrinkage in
the last quarter of 2008 would have gotten much worse without economic stimulus
spending and federal government bailouts of banking, insurance and auto
industries. And a much more severe
economic recession would have resulted.
Shrinking the size of
government until it can be drowned in a bathtub, as advocated by the strict
anti-tax ideologue Grover Norquist and his fat cat supporters, may appeal to
some people, but it can be seen that en route to the dismantling of the public
sector, a good portion of Americans would likely be harmed. Deregulation, tax-cutting, privatization,
laissez-faire governance, monopoly practices, the facilitating of rent-seeking
activities, and the stimulation of increased leveraging may sound good in
principle to some people, but the devil is always in the details. As with anything not sensibly balanced, such
things in aggregate can lead to highly undesirable consequences.
conventional wisdom is not necessarily right.
The dogma of deregulation, for instance, involves an almost religious
regard for “free markets”. But the
failures of supposedly free markets are well known. They include market instability, monopoly
dislocations, extremes of inequality, cheap labor sweatshops, perverse
incentives, irrational exuberance during speculative bubbles, paralyzing fears
during economic recessions, cyclical levels of high unemployment and the
socially irresponsible gambit of externalizing costs that can cause disastrous
impacts on the environment. Unfettered competition may result in low prices
for consumers, but it can also encourage waste and create a “race to the
bottom” by competitors who strive to evade environmental protection costs and
to minimize wages and benefits for workers.
Deregulation also opens the doors to such things as
banking fraud and a variety of schemes for corporations to abuse power. Consider Enron Corporation, a conglomerate
based in Houston, Texas that went bankrupt in December 2001. Enron was named "America's Most Innovative Company" by Fortune magazine for six consecutive
years before it was discovered that its innovation mainly involved a shrewd
variety of scandalous activities and accounting frauds. Among other things, Enron created
a number of fraudulent schemes to exploit California’s power market, giving
them names such as Death Star, Fat Boy, Get Shorty and Ricochet. As an
example, the Death Star strategy was the name Enron gave to their practice of
shuffling energy around the California power grid to receive payments from the
state for "relieving congestion." According to Enron’s own
memo, they would be paid "for moving energy to relieve congestion, without
actually moving any energy or relieving any congestion."
Arthur Andersen, the Certified Public Accounting firm, was formerly one of the “Big Five” accounting
firms that provided auditing, tax and consulting services to large
corporations. In 2002, the firm
voluntarily surrendered its licenses to practice as CPAs in the U.S. after they
were found guilty of criminal charges related to the firm’s handling of the auditing of Enron. It just goes to show that
in interests of making money, probity and integrity often go out the
of the most highly paid lawyers and accountants are those who put a shiny
patina of propriety on skullduggery. In
the book and film Merchants of Doubt, this fact is revealed with
uncommonly amazing clarity, when the very same highly compensated
unethical legal beagles who helped Big Tobacco deceive people about the
deadly health risks of smoking tobacco suddenly showed up in the employ of Big
Oil using the same sow-doubt-and-delay tactics to deceive people about the real
far-reaching, deadly and hyper-costly risks associated with carbon emissions.
about the banking industry. Bernie
Sanders has an often-repeated refrain that “the business model of Wall
Street is fraud.” A “business model” is a plan for making money. Is
fraud really an essential part of the way Wall Street banks make money?
confirms that banks try to bilk customers in a number of duplicitous ways to
make bigger profits, and that’s not the only line of business where banks
commit fraud. According to an article by Richard Eskow, the major
offenses committed by our largest banks include “price fixing, bid
rigging, market manipulation, money laundering, document forgery, lying to
investors, sanctions-evading, and tax dodging.”
April 2016, a $5.1 billion fraud settlement was reached with Goldman Sachs
along with a $1.2 billion fraud agreement with Wells Fargo Bank. And that’s on top of an estimated $200
billion in fraud fines and settlements that have been made by banks over the
last several years. “How many
settlements, how many billions, will it take to convince some fact-resistant
pundits and politicians that there is an epidemic of fraud on Wall Street?”
broad category of corporate malfeasance is tax avoidance. One of the most popular schemes in recent
years is known as a “corporate inversion”.
Consider the example of Pfizer, one of the world’s wealthiest
pharmaceutical companies. Like many companies
before it, notably Fruit of the Loom, Transocean, Seagate Technology, Eaton
Corporation and Burger King, Pfizer decided to move its tax address offshore in
a merger that would allow it to claim foreign citizenship and dodge U.S.
taxes. Under this type of tax loophole,
Pfizer claimed that it intended to become an Irish company, while its
headquarters and employees would stay in the US. “The company will continue to benefit from all
that America has to offer -- millions of customers; nearly $1 billion in federal government
contracts; an educated workforce; good transportation systems; and strong financial and drug safety
systems. Not much will change, except
that Pfizer just won’t have to pay its share of the cost for most of this.”
a surprise announcement, the Treasury Department on April 5, 2016 finally
cracked down on this type of corporate scam, throwing a wrench in Pfizer’s plan
to merge with the company Allergan in a huge $152 billion deal. It is noteworthy that Pfizer is not exactly a model
corporate citizen. It has allegedly
hiked prices of seven of its top selling drugs by an average of 39 percent
since 2014, and it charges 12 times as much in the U.S. for Medicare patients
for those drugs as it charges in Ireland, where it had intended to relocate to
save on U.S. taxes. And Pfizer will
almost certainly continue to overcharge Americans for prescription drugs, using
a variety of rationales, even though it failed to get permission to move
biggest corporations in America also exploit tax loopholes to stash huge sums
of money abroad, currently having more than $2 trillion offshore that allows
them to avoid paying an estimated $700 billion in taxes. The last time giant corporate entities got
permission to “repatriate” such funds was in 2004, when they brought back money
at a 5.25% tax rate and promised the repatriated funds would be used to create
jobs and other things beneficial to the majority of Americans, but the money
was primarily used in mergers and stock buybacks that benefit CEOs compensation
-- and “Not surprisingly, more corporations also rushed to set up real or dummy
operations abroad to take advantage of the next sting.”
Fervent proponents of
repatriation and tax cutting are like advocates for deregulation, propounding
an ideology that mainly benefits wealthy people and other special interest
groups. This ideology is oft-times
disguised as a populist initiative, but in reality, it is a ruse by rich people
to get outsized benefits for themselves by enlisting the gullibility,
insecurity, anger and frustration of the masses in support of goals that are a
boon principally to an extremely small proportion of the population.
Any honest analysis of
the effects of regressive changes in taxation that were implemented under
Ronald Reagan and George W. Bush reveals that these changes have made life harder
for most Americans. These changes are an
outright disaster for tens of millions of people who have seen the purchasing
power of their wages decline, or have lost their jobs or savings or homes, or
who are incarcerated in prisons, or who have been forced to choose to risk
their lives fighting wars because it is one of few opportunities available to
them. Since cutting taxes has led to
such large increases in the national debt, this narrow ideology is also decidedly
negative to the prospects of all people in future generations. Hell of a job, guys!
“Push the frappe button again,
--- Vinnie del Mar
Human nature intrinsically plays a defining
role in our societies, economies and politics, so we should find a way of
understanding human nature that is rational as well as intuitive and honest and
true. While human nature essentially
remains the same, habits and behaviors can be profoundly influenced by public
policies, for better or for worse. We
should be sure to strive for better outcomes!
Once again the need to implement socially and ecologically smarter
incentives is accentuated. People simply
should be encouraged to do things that are advantageously consistent with the
greater good. Green taxes and properly
targeted disincentives should be enacted to discourage harmful activities. Wrong-headed subsidies for industries that
mine fossil fuels and provide war services should be cut.
It is high time that we begin acting with
greater responsibility toward the generations that will follow us. Politics oriented to the short term, along
with “we win, you lose” partisanship, are becoming extreme disservices to the
American people, now and in the future.
Journalist Robert Kuttner makes a compelling
observation in A Presidency in Peril –
The Inside Story of Obama’s Promise, Wall Street’s Power, and the Struggle to
Control Our Economic Future:
“Ideology is not some arbitrary penchant for clinging to stale
ideas. It is a principled set of beliefs
about how the economy and society work, and should work. To be a conservative Republican is to believe
that markets work just fine, and that people mostly get what they deserve, and
that government typically screws things up.
To be a liberal Democrat is to believe that market forces are often
cruel and inefficient; that the powerful
take advantage of the powerless; and
that there are whole areas of economic life, from health care and Social
Security to the regulation of finance, where affirmative government is the only
way to deliver defensible outcomes for regular people. The problem afflicting America is not
‘ideology’. It’s the hegemony of right-wing ideology.”
A new era of cooperative problem solving
must be ushered in sometime soon. Stubborn
intransigence and extreme obstructionism are too counterproductive. Step forward, Republicans. Your dishonest spin and knee-jerk opposition
are often not constructive, and in many ways they are sabotaging our
nation. This is not something about which
to be proud. Good governance is a better
Freedom Just Another Word for Nothing Left to Lose?
corruption today often involves subtle forms of influence peddling rather than
illegal bribery or fraud. People with money and power have the most
influence over the economic rules in our system, so these
rules disproportionately benefit them at the expense of everyone else.
political establishment has sold the average American down the river in too
many regards, especially by making international trade deals that have sent
millions of manufacturing abroad, and by spending too much money on military
involvements abroad while catering too eagerly to wealthy people and running up
the national debt to satisfy misguided priorities. Establishment
interests have betrayed the public trust by using coldly calculated strategies
to divide people and fan the flames of grievances, frustrations, anger, racist
antipathies, gender politics, white male anxieties and religious intolerance.
Incumbent politicians have driven a hard bargain with working people and
the poor while striving to rig the economy ever more extremely in favor of the
well-to-do, and these efforts have contributed to a dangerous widening of
extremes in inequality in our society.
establishment interests bailed out Wall Street and giant corporate entities
during the credit crisis of 2008, the best interests of the majority of people
on Main Street were mostly ignored. On top of all these objectionable
attributes, which have given the politicians who represent us historically low
approval ratings, these conniving politicians deceive the people they should be
representing by lying to them about whose best interests they really intend to
champion once they are elected and begin making new laws and spending
who argue most vehemently in favor of "free markets" and against
government interference in these markets are generally the same people who
exert the most disproportionate influence over the rules that govern the market.
They equate the "free market" with liberty, but behind the
scenes they manipulate the rules of the game to their own advantage.
"They extol freedom without acknowledging the growing imbalance of
power in our society that's eroding the freedoms of most people", as
Robert Reich incisively explains in Saving Capitalism: For the Many, Not the
Few. Reich adds, "Those who claim to be on the side of freedom
while ignoring the growing imbalance of economic and political power in America
and other advanced economies are not in fact on the side of freedom. They
are on the side of those with power."
day that passes in 2016 provides more proof of the corrupting influence
unleashed by the Supreme Court's wrongly decided 5 to 4 ruling by
"conservatives" in the Citizen's United case. An
estimated ten billion dollars will be spent on this year's national elections,
representing more than twice as much as the amount spent in 2012. And
almost $1 billion of this will come from billionaires Charles and David Koch,
in a blatant display of their relentless effort to undermine environmental
protections and the well-being of working people.
of Americans are justified for being bitterly angry, due to feeling betrayed by
international trade pacts that have moved their jobs out of the country, and
due to being left behind by elites in the increasingly unfair disparities
between their fates and those of the stunningly well-to-do. It is all but a crime for egotistical self-promoting
alpha-male fear-mongering politicians to hijack the pride and passions and
prejudices of these folks, and their frustrated feelings and anger, and to
trump their general welfare for the bald purpose of creating an even more
unfair society that is more corporate-centric, belligerently nationalistic,
ethnocentric, racist and white male supremacist.
is noteworthy that Congress approved a top Republican goal in May 2000 to give
China "permanent normal trade relations." Since
that Congressional action, more than 2 million factory workers have
been lost their jobs as big businesses outsourced production to China.
The reason factory owners relocated their businesses to China and other
low wage countries has been to dodge high American wages and environmental
protection costs, and to move production to places where workers are paid
poorly and are forced to work long hours.
This decision has turned out to have a much worse impact
on blue-collar workers than almost any other trade deal in history,
including the North American Free Trade Agreement that passed on a
bipartisan vote in 1993.
harsh economic and political effects of this deal with China have directly
contributed to the blue-collar anger that Donald Trump has harnessed
to challenge the GOP’s pro-trade orthodoxy. Trump has exploited this
anger of workers who have lost their good-paying factory jobs by charging that
our leaders made a bad deal with China.
gift has arrived, in early April 2016, from the Goddess of Coincidence and
Revelation, materializing right smack dab in the middle of the rancorous
competition for the world’s most powerful position. Millions of Americans are angry about how
politicians have “sold them a bill of goods” by championing the marvelous
merits of international trade agreements, which turn out to contain many
provisions that are contrary to the best interests of the people to whom the
politicians work so hard to sell such agreements.
The biggest data leak in history has
been disclosed to investigative journalists in the unfolding Panama Papers
scandal. An anonymous source tapped into
a Panamanian law firm named Mossack Fonseca and leaked millions of documents that provide details on how
global elites have used Panamanian law to shield income and information from
national tax authorities. These
revelations have focused the public’s attention on the myriad ways the powerful
hide their wealth.
turns out that a “free trade agreement” with Panama that was enacted by
Congress and President Obama in 2012 was partially responsible for Panama’s status
as a top tax haven. The leaked
“the dark secrets of offshore tax havens and phony shell companies favored by
the mega-rich and powerful -- from plutocrats and politicians to movie stars
and professional athletes -- who use them to hide and hoard their fortunes,
even as billions live and die in poverty,” reports Michael Winship, a senior
writer of the site BillMoyers.com.
bottom line is that U.S. trade policy has devastated the working class while
making the rich much more wealthy.
Millions of jobs have been shipped abroad and profits have been
concentrated in the hands of the few, who hide them to avoid paying taxes on
them. President Obama, like most members
of the establishment, both Democratic and Republican, has been a strong
supporter of trade agreements, and he made an interesting observation about the
scandal in Panama when he stated, “tax avoidance is a big global problem. It’s not unique to other countries because, frankly, there
are folks here in
America who are taking advantage of the same stuff. A lot of it is legal,
but that’s exactly the problem. It’s not that
they’re breaking the laws, it’s that the laws are so poorly designed that they
allow people, if they’ve got enough lawyers and enough accountants, to
wiggle out of responsibilities that ordinary citizens are having to abide by.”
Wallach, director of Public Citizen’s Global Trade Watch made the issue
clear: “The Panama Papers just show once
again how entirely cynical and meaningless are American presidents’ and
corporate boosters’ lavish promises of economic benefits and policy reforms
from trade agreements.” The Panama
free-trade deal’s “investor protections and official U.S. stamp of approval
made it safer to send dirty money to Panama.”
2011, Senator Bernie Sanders commendably spoke out against the establishment
trade deal fervor when he spoke passionately on the floor of the Senate against
the Panama deal. Sanders said that the
pact “would make this bad situation much worse and keep the United States from
cracking down on abusive and illegal offshore tax havens.” The Panama Papers are proving that Sanders
was right, and the establishment was deceiving the people in promoting the
merits of the Panama free trade agreement.
is as much as $27 trillion hidden in shell companies around the world, outside
of the reach of governments and public scrutiny, according to Porter McConnell,
the director of the Financial Transparency Coalition. This has a huge impact on the global economy,
says Ms. McConnell, from corporate tax evasion to international criminal
trafficking. According to the
Organization for Economic Cooperation and Development, developing countries
lose seven times as much as they receive in development aid because of money
hidden in tax havens.
Panama Papers has brought global attention to the impact one Panama-based firm
has had in setting up shell companies for wealthy individuals and politicians
around the world. But the United States happens to be one of the easiest places
in the world to establish a shell company through which a corporation or a
wealthy individual can hide their wealth, and McConnell explains that there is
a case to be made on both ends of the political spectrum for changing the rules
so that there is more transparency and more capacity to police illicit
corporations are increasingly using schemes known as "investor-state
dispute settlements" to retaliate against countries that enact climate
protections or reject dirty fossil fuel projects. Consider this
little-known type of devil-in-the-details provision that is often found
embedded in the fine print of international trade deals. After President Obama rejected the Keystone
pipeline, the company involved -- TransCanada -- unveiled plans to
use investor-state dispute settlement rules
contained in the North American Free Trade Agreement to sue the U.S. government
in a private trade tribunal for a whopping $15 billion. Such rules are
another way that good aspects of expanded international trade, which is
facilitated in trade agreements, are offset by nefarious provisions that run
counter to the greater good.
the rules of trade deal and other rules of law turn out to be at odds with
fairness and propriety, then the laws should be changed. And when the politicians who are supposed to
be representing the best interests of the people are formulating new trade
deals and new laws, We the People
should demand greater integrity from our representatives and insist that they
do not allow giant corporations to have free rein in writing the provisions of
the laws in their favor, especially if it is likely to cost workers millions of
jobs or taxpayers billions of dollars.
And when federal judges and Supreme Court Justices are divided along
ideological grounds, in any case, they should be commended to consider the true
fairness and propriety of the law in making their decisions.
latest international trade agreement under consideration would be the biggest
of them all. The proposed Trans-Pacific Partnership
is like “the Panama deal on steroids,” and it would almost certainly help rig
the market even more definitively in favor of giant corporations and the
wealthy. That’s good enough reason for
people worldwide to strongly oppose it until its worst provisions are remedied.
have relentlessly pursued a strategy of simultaneously weakening the
government, complaining about the failure of programs they had just sabotaged,
and creating a perpetual-motion machine of government destruction.
"Extremism in defense of liberty is not a vice, but I
denounce political extremism, of the left or the right, based on duplicity,
falsehood, fear, violence and threats when they endanger liberty."
--- George W. Romney, Mitt’s father
seem to be disrespectful of, and often downright antagonistic
to, the concept of fair-minded reciprocity as embodied by the Golden Rule.
Many of them are passionately opposed to desegregation and civil rights
for blacks and fundamental rights for women and broadminded public
want to have things their way, and are increasingly unwilling to compromise,
and in their world there is no place for uppity women or uppity blacks or
uppity students or uppity liberals or Mexicans or Muslims or immigrants.
express zealous opposition to comprehensive immigration reform, preferring to
scapegoat the nearly 12 million undocumented immigrants that work in the
shadows in some of the least desirable and most poorly paid jobs in America.
They demonstrate a fierce loyalty to the idea that these "illegal
aliens" should all be deported, a plan that would have immediate
calamitous consequences for our economy, along with disastrous impacts on the
persons involved and the countries to which they were sent.
A Salvo Sent
toward the Democratic Establishment
establishment in our political duopoly system serves to undermine progressive
policy-making in many instances. Most
observers are aware of the shrewdly uncompromising oppositional tactics used by
politicians in the Republican Party, and of their retrogressive stances on many
issues. But the many ways that the Democratic Party establishment acts as
an obstacle to progressive change are less well understood.
Party establishment finds itself concerned by the surprising success of Senator
Bernie Sanders’ presidential campaign and his efforts to return the party to
its modern roots of New Deal social democracy.
The response of this establishment has included a complex coupling of
the opinions of elite economists and elite elements in the media that is aimed
at promoting an image of Bernie Sanders as an unelectable extremist with
unrealistic economic policies.
provides a case study showing how the Democratic Party tries to suffocate
The slamming of Sanders has been joined by a number of past
Democratic appointee chairs of the Council of Economic Advisers. "In an open letter co-addressed to
Senator Sanders, Messrs.
Kruger, Goolsbee, Romer and Tyson mauled a favorable empirical assessment of
Sanders’ economic program conducted by Professor Gerald Friedman." The
letter did not include any detailed independent assessment, but simply declared
the assessment unsupported by the “economic evidence”.
legitimate room for intellectual difference.
What is stunning is the tone of the critique and the fact it sought to
diminish important policies like fiscal stimulus and less expensive education
just because Sanders was using them to his political advantage.
"Given their elite professional standing and easy access to elite
media, these attacks quickly ramified throughout the mainstream media,
illustrating how the elite-media/elite-opinion nexus works."
"The slamming of Sanders reflects an enduring status
quo defense mechanism which usually begins with insinuations of extremism, then
mixes in charges of lack of qualification and realism, and ends with assertions
of unelectability. It is applied in both political and public intellectual
--- Thomas Palley
analysis reveals that these criticisms are not particularly valid, but that
instead they seem to be part of a pattern of obstruction of progressive
policies and politicians that is characteristic of the Democratic establishment
half of our political duopoly system.
Rather than an excess
of pipe dreams, our current dismal condition is the product of a fear of
dreaming. The Democratic Party
establishment persistently strives to downsize economic and political
expectations. Sanders tried to upsize
them, which is why he has been viewed as such a threat. The status quo defense mechanism has been
used today to tarnish Bernie Sanders, but tomorrow it could again be used to
rule out any number of progressive policy options and advocates.
An Evaluation of the High Cost of Low Prices and High Investment Returns
Fast-food workers conducted nationwide demonstrations demanding higher
pay in December 2013. Cheap food is
cheap, Michael Pollan explains, partially “because the real costs of its
production are hidden from us: the
exploitation of food and farm workers, the brutalization of animals, and the
undermining of the health of the soil, the water and the atmosphere.”
There is an exceedingly high cost of low prices and artificially high
profits. Anyone who watches the
documentary film Wal-Mart: The High Cost
of Low Prices will be momentarily dazed and enlightened. When a bright light is shined on specific
follies of allowing costs to be externalized onto society, this stark
illumination should motivate us to rise up and demand a new surge of better
Huge firms like Walmart and McDonald’s are notorious “for being brutally
tough on their suppliers, forcing them to cut costs, and also for their
opposition to unionization of their enormous, low-wage retail work forces, who
often have very difficult working conditions.”
The litany of woes caused by Wal-Mart is staggering. Their business model has destroyed thousands
of small businesses and undermined the quality of life in many small
towns. It has radically upset the lives
of countless owners of family stores.
Wal-Mart has engaged in ruthless monopoly practices and outsourced
thousands of jobs to nations abroad that have cheaper labor and generally
worser working conditions. This behemoth
corporation is the biggest employer in the USA, so widespread ill effects
prevail when it underpays its employees.
Its practices drive down retail wages, suppress collective bargaining
rights of employees, discriminate against women, cheat workers out of overtime
pay, exploit illegal immigrants, provide inadequate healthcare benefits to
employees, and foist big costs onto taxpayers.
And it has even failed to take adequate steps to protect its customers
in Wal-Mart parking lots from crime.
Wal-Mart is a primary driver in the “race to the bottom” that is hurting
the American people and peoples abroad in many ways.
Two Ohio Wal-Mart Superstores instituted a campaign around Christmas time
in 2013 to get their employees to contribute desperately needed food -- to
struggling, hungry Walmart employees. ”That's
right. Walmart raked in $15.7 billion in
profits last year alone, but apparently they don't feel any need to share that
wealth with their millions of workers.
Instead, they stick them with poverty wages, and then send them off to
ask government, food banks, or even each other for help.” Outrageously,
the Walton family has been unwilling to make generous contributions to this
fund, even though it is the wealthiest family in the whole world.
What are the real costs of low wages? Low
wage earners receive an estimated $250 billion each year in food stamp
assistance and Medicaid and other public benefits. By underpaying retail and fast-food workers,
big corporations force taxpayers to pay for these huge socialized costs.
A Plug for the
Wisdom of Investing in Public Education and the Social Good
When budgets for
higher education are cut, according to one professor, “it is like eating our
seed corn”. A strong case can be made
that universities are among the most powerful engines of economic growth in
every state, so their budgets should not continue to be slashed so deeply. The prosperity of the U.S. today is, to a
significant degree, based on technologies developed by government-funded
R&D in universities, and by publicly-funded research institutes and the
U.S. military and NASA. Realizing this,
it becomes clear that it is foolish to cut funding for higher education and
Only the most desperate farmer would eat seed corn
that is critical to growing crops in future years. Eating the seed corn is just so starkly
shortsighted! Such a course of action is
even more foolhardy than letting one’s home fall apart by failing to maintain
the roof or caulking, or risking a catastrophic fire by neglecting to keep
functioning batteries in smoke detectors.
An extrapolation of this kind of myopia would be to let whole
neighborhoods deteriorate, or entire communities, or the whole country. Surely we can do better than this!
In thinking about the vital importance of seed
corn, consider the strategies of corporations like Monsanto that obtain patents on genetically-modified seeds in
an effort to create a monopoly on plant and animal life-forms themselves. The creation of plants that produce no
fertile seeds is a cynical strategy to make it necessary for farmers to buy new
seeds every year. The invention of
sterile ‘Terminator seeds’ is a corporate ambition that is almost as
potentially nefarious as efforts to privatize water supplies and create
monopolies over fresh water sources.
These are insidiously exploitive methods of making bigger profits!
It is important to understand that public
universities are the most effective engines of social mobility. From this perspective it is misguided to
allow a good education to change from being a public good to a private
commodity funded by big
increases in burdensome personal debt.
Back in the late 1960s, most of the budgets for public universities were
publicly funded. Today, however, the
federal government and various state governments provide only a small fraction
of needed financing. This is a change
that reflects sadly on the wrongheaded nature of modern trends. This is one of the “gradual and silent
encroachments” that James Madison spoke about with such compelling acuity of
insight when he warned Americans about the potential for people’s freedom to be violated by those in power.
Pope Francis has criticized the capitalist
system by saying that people have “a crude and naive trust in the goodness of those wielding economic
power.” He was particularly tough in his
words on ideological theories that assume economic growth is a sufficient
social goal and that deny governments an active role in humanizing free
Limbaugh jumped on these words from the Pope, accusing him of advocating “pure
Marxism.” Why the rancor? Here the Pope was proposing deeper truths,
and the leader of American “dittoheads” was practically apoplectic with fervor
and conviction in promoting superficial untruths. Limbaugh, of course, is paid exceedingly well
for his maniacal diatribes, and he is required to pay very low tax rates on his
ill-gained windfalls, in accordance with the politically determined tax system
that treats high-income earners to historically low rates of tax.
As some of the
hard working, hard-drinking, hard-living, hardscrabble whoring miners of old
Wild West Colorado might have cautioned Limbaugh, “To Hell You Ride.” Some things just gaily go hand in hand!
Daniel Goleman writes in Ecological Intelligence that “radical
transparency” is needed to reveal to consumers the true environmental and
social costs involved with the goods they buy.
It is Goleman’s hypothesis that once consumers know the extent of
harmful impacts associated with every competing product, they will tend to
choose ones that are greener. Well, that
may be true to an extent, but then again knowledge of true costs may not lead
to significant changes in consumer behaviors.
The idea of greater transparency may be a good one, but I personally
feel we need changes that are far more transformative. We need to come to grips with the necessity
of limiting waste and total consumption, and population growth, rather than
merely trying to find ways to get people to buy things in slightly greener and
more socially responsible manners.
If people in aggregate were to buy less
stuff, it would help mitigate problems related to the depletion of resources
and increasing amounts of pollution, toxic wastes and greenhouse gas
emissions. Such a development, however,
would create an obvious paradox. All
national economies are largely predicated upon growth in consumption of goods
and services, so a reduction in consumption on a per-capita basis, or a slowing
in growth of the number of consumers, would crimp profits and could cause an
economic recession, or worse. Growth of
government spending and borrowing would then become untenable, and Ponzi-like
schemes of Social Security, Medicare and high government spending would falter.
This means that we are faced with a
conundrum similar to the “paradox of thrift”.
This paradox recognizes the fact that, whereas it makes good sense for
an individual to save some of the money he or she earns by spending less, if
everyone were to do this at the same time, the overall level of spending would
fall and businesses would cut back on production and lay off workers. Individual thrift could thus cause increases
in unemployment, and total savings might actually fall.
The complexity of such interconnections
makes it more necessary than ever to think in aggregate terms and to focus our
public policy considerations on longer-term outcomes -- and to be scrupulously
honest in our evaluations. A new form of
ecological intelligence should be embraced that emphasizes living on planet
Earth in ecologically sound and sustainable ways. To accomplish such a propitious goal, we
surely need our political leaders to act much more fairly and sanely!
The Latest Perspective
on the Paradox of Thrift
A “family belt-tightening” metaphor
indicates that, during hard economic times, we should cut spending, save money,
and pay down debts. This metaphor is
powerful because of its obvious validity at the level of individual household
finances. When a person loses their job,
they either spend less money or incur more debt or eat into their savings. This metaphor, however, is fundamentally
misleading, and it can be a bad idea with regard to the national economy as a
whole. It turns out that what is smart
for a family may not be smart for society.
This is true because of the paradox of thrift, in which belt tightening
by everyone at once results in less spending in aggregate, and job layoffs, and
a decline in total savings. Everyone
thus can become worse off.
When recessionary times occur and
unemployment spikes, some form of collective action is needed -- like increased
government investments and spending on necessary long-term projects. A “winter on the farm” metaphor may be a
better way to see things during hard economic times. On a farm, when winter comes and many of the
usual jobs do not need to be done, farmers keep busy with long-term projects
like fixing machinery, repairing the barn, improving irrigation systems, or
digging a new well.
When the Great Depression took place,
public works projects were undertaken that put millions of people to work by
investing in national infrastructure improvements like roads, dams, bridges,
firehouses, waterworks, airports, public transportation, electrical utilities,
schools, libraries and parks. Today,
with interest rates at record lows and millions of people seeking jobs during a
time of high rates of underemployment, and with a growing urgency to maintain
and upgrade deteriorating roads, bridges and other infrastructure, it would
seem like a no-brainer for us to once again make smart investments in needed
Since the U.S. has relied on enormous
amounts of deficit financing in the past decade, government spending is under
increasing scrutiny, and opposition is increasing to additional deficit
financing. So it is becoming important
to find ways to stimulate the economy without borrowing more money. And, sure enough, there is a good way. Nobel Prize-winning economist Paul Samuelson
proposed an idea in the 1940s: a
“balanced budget theorem”. This idea
held that if a government spent more on goods and services, and raised taxes by
the same amount during a period of high unemployment, the national income would
grow by the same amount as the tax, so after-tax income would be unchanged. This would stimulate the economy without
increasing the national debt.
We should try this strategy. We have given “supply-side economics” and the
trickle-down theory credence for almost 35 years without any signs that they
have any validity. Trickle-down
ideologies have created regressive tax changes and a dangerous spike in
national debt, and radically widening disparities in wealth between rich people
and everyone else.
Francois Hollande, today’s president of
France, proposed an idea consistent with the balanced budget theorem to deal
with high unemployment in his country when he first came into office. He proposed a new tax on all incomes in
excess of 1 million Euros per year (about $1.25 million). The proceeds of this tax would be used to
finance the hiring of 60,000 needed teachers.
The higher tax, plus the additional tax revenues from the teachers’ pay,
would match the higher costs of the teachers’ wages, and investments in
education would improve the skills and abilities of people in the workforce,
giving the economy a future boost.
This balanced budget theorem makes
sense. It is much different theory than
the trickle down theory, which rich people have been aggressively and
disingenuously promoting for so many years.
Another result of trickle-down economics has been to erode the financial
well-being of the majority of working people.
The trickle-down theory holds that tax cuts for the wealthy will result
in rich people spending lots of money and investing their growing wealth, and that
this will create jobs and trickle down to benefit everyone else. This suspicious rationalization has become
the main platform of the Republican Party, as it clamors to keep cutting taxes
on people with the highest incomes.
Unfortunately, this ideology appears to be
much more like a manipulative form of mass deception. Yet somehow wealthy people manage to convince
millions of people that this trickle down narrative is true -- or will someday
soon surely prove to be true.
Government austerity measures are
detrimental to economic growth, and they create political instability and
heightened social unrest, as evidenced by upheavals in Greece, Spain and
Italy. National policies that create
heightened stress on people, and more frustrations, and increased insecurity
and more hardship, are proving to be misguided ways of managing our affairs.
People generally want good government, and
they don’t want to spend their time and energy in worrying about whether or not
the government will protect the best interests of the nation as a whole. Americans don’t want a meddling, wasteful,
fiscally irresponsible, privacy-invading, repressive or paternalistic
government. But they also don’t want one
that discriminates against whole classes of people, or one that makes the
majority of people less secure while enriching the wealthy.
The Paradox of
An even more
complex conundrum confronts our civilizations in the form of a curious Paradox
of Profligacy. Economic growth is
practically predicated on advertising-stimulated demand for products and services,
and on conspicuous consumption, fashion obsolescence, wasteful uses of
resources, the “wealth effect” of stimulated economic bubbles, inflationary
monetary policies, the Keynesian stimulus of deficit spending, and a continuous
growth in population. But this
profligacy will eventually and inevitably cause our Juggernaut of consumerism
to crash headlong into limits inherent in finite resources and the natural
carrying capacity of ecosystems for our needy and mindlessly greedy kind.
recklessly used up more resources in the last century than in all of the
200,000 years of our species’ existence.
This is made cogently clear in the thought-provoking and hauntingly
beautiful film Home by the famous
aerial photographer and ecologist Yann Arthus-Bertrand. I strongly recommend that everyone check out
this 93-minute-long film. Watch it on
It is madness to
blithely pursue courses of action that deplete resources and harm the
environmental commons that sustains us.
We collectively need to find some way to stop rushing blindly toward
ecological collapse. This increasingly
likely outcome is not some doom-and-gloom expectation like mythological End
Times prophecies in which God condemns humanity as retribution for supposed
sins. No, this is a more evidence-based
understanding that we are gambling with the well-being of all people in future
generations by our actions, both intentional and inadvertent.
salvation will be found in developing solutions to the overarching global
challenges that face us, not in remaining ignorant or in denying greater
truths, and not in slavishly obeying fears and embracing backward-looking
dogmas. We would be wise to courageously
choose to honor the most honest and farsighted understandings and actions that
will help create a safer and healthier future.
Larger and More Comprehensive Considerations
understandings should be cultivated so that we see more accurate assessments of
the consequences of all public policies.
abound in every national policy decision.
Consider, for instance, the North American Free Trade Agreement (NAFTA)
that was signed in 1992 by Canada, Mexico and the United States. This agreement resulted in a substantial
increase in exports of corn to Mexico, a commodity produced cheaply by
mechanized American agribusiness corporations that are highly subsidized.
As a result, an estimated 2 million jobs were lost on small farms in
Mexico, and many of these farmers were forced in desperation to emigrate to the
U.S., where they work for low wages and effectively push down wages for all
influx of largely illegal immigrants has caused a wide range of problems and
conflicts, and it has strengthened anti-immigrant sentiments. It also undesirably stimulates the energy
behind reactionary politics and empowers right-wing ideologues that use this
issue to scapegoat immigrants, gain power and obstruct sorely needed
Fair trade would have been a far better plan for almost everyone
concerned than unfair “free trade”. The
negotiation of the NAFTA deal significantly benefited giant agribusiness
corporations in the USA, and gave bigger profits to a relative few while
causing high social costs that have adversely affected the lives of millions of
people. It also led to job losses in the
U.S. as factories and jobs relocated to cheaper labor countries like
Mexico. Such agreements are one more way that social instability and the
ruthless aspects of competition and human nature are stimulated in our economic
and political systems. It is crazy to
continue to encourage this “race to the bottom” that allows good citizen goals
to be undermined and worker and environmental protections to be evaded.
A good case can
be made that gross inequalities and inequities are an inevitable part of the
capitalist system. A principal theme of
Joseph Stiglitz’ excellent book The Price
of Inequality is that inequities are also a result of political
forces. There are good reasons for
capitalist societies to undertake a sensible partial redistribution of wealth
in a just manner -- by instituting more steeply graduated tax policies.
While we are
redesigning the incentives in our society, perhaps we should start by creating
more effective incentives for politicians to make bipartisan compromises for
the greater good. People are getting
tired of having their representatives continue to use the politics of inequity,
division, fear and animosity, all to the detriment of the greater good. This is a main reason that the approval
ratings of Congress are at record lows.
I’ll bet we could come up with clever ways to prevent shortsighted
expediencies and mean-spirited, elitist and self-serving politics from
undermining our capacity to solve problems. Surely we could find better ways to
create a more stable and stronger financial system and a healthier, fairer,
more sustainable economy.
When the French
economist Thomas Piketty concludes, in his epic book Capital in the Twenty-First Century, that unless something changes,
the wealthy will keep getting wealthier at an accelerating rate, he is guided
in his understandings by a good sense of history and economics, and a deep
grasp of Enlightenment ethics. These
guiding lights have brought him to a better perspective on the genuinely
terrifying implications of increasing inequality, and they have inspired him to
propose a “global wealth tax”. This
great idea is consistent with the Fair Play Wealth Assessment plan recommended
in Common Sense Revival.
Wisdom of Bubble Economics in Real Estate
Some friends and I had
an interesting debate about whether or not it should be a national goal to have
a booming real estate market. The rapid
inflation in home prices from 1997 to 2006 exceeded 10% annually in many regions. Obviously it would have been better to have a
smaller, steadier increase in home values, roughly keeping pace with inflation,
rather than the volatility of a rapid appreciation and then a devastating bust.
Home prices increased
rapidly in the years after 1997 because Congress had enacted a very generous
$250,000 capital gain tax exemption for an individual on the sale of a home, or
a $500,000 exemption for a married couple.
This extraordinary encouragement stoked home prices and made real estate
into an asset subject to economic bubble conditions. The real estate bubble was engineered by
Congress, banks, mortgage lenders and ratings agencies, among others, and it
was aided and abetted by house-flipping speculators and the Federal
Reserve. Both the Clinton and Bush
administrations strongly promoted the expansion of home ownership.
After the bursting of
the stock market dot-com bubble in March 2000, the Federal Reserve reduced
interest rates to very low levels, creating even further speculative impetus in
the housing market. Banks eagerly and
repetitively encouraged people to take out loans against their increasing home
equity. So, many people borrowed
heavily, and this set up bigger risks of foreclosures when the market went
bust. Lax lending standards
proliferated, just like economist Hyman Minsky said they would do in the late
stages of an economic cycle. This
contributed to the severity of the bust.
Regulators also failed to prevent predatory lending practices, or to
regulate subprime mortgages or mortgage-backed-security derivatives.
The real estate bubble
also had significant undesirable effects on people who rent by causing rents to
increase, making life more challenging for renters. And it contributed to the
sprawling growth of suburbs, and forced more people into homelessness. It also contributed to an increase in the
national debt when Fannie Mae and Freddie Mac had to be bailed out.
The fact of the matter
is that homes physically deteriorate and actually depreciate as time
passes. Every homeowner is aware of
this, because weathering and physical deterioration force them to make costly
repairs. Roofs must be periodically
replaced, and new paint and maintenance are costly -- and these things are all
too frequently needed.
In 2011, a stunning
high of 28% of homeowners had negative equity, i.e. were “underwater”,
according to Zillow, the online real estate database. Taking into account the fact that Realtor
fees are generally about 6% to sell a house, and a minimum 10% down payment is often
required to buy another home, more than 50% of all mortgaged households in the
U.S. were effectively underwater. The
real estate bubble trapped people into this position, and this has had highly
negative impacts on the lives of millions of people. As 2015 unfolds, real estate appreciation is
again being strongly stimulated by continuing low interest rates, and this
volatile cycle continues.
Another reason that
home prices have increased so much is that average home sizes have gotten much
larger. The average house size was less
than 1,000 sq. ft. in 1950, and it increased to more than 1,700 sq. ft. by
1980, and then to over 2,300 sq. ft. by 2010.
In housing, it seems, there is little respect for the idea that “small
is beautiful”. The realization that
there is great virtue in simplicity and moderation has seemingly been
lost. The understanding that our
possessions can come to possess us, and that oppressive debt is a form of
bondage, are too often ignored. And a
fair-minded concern for the outlandish size of our ecological footprints is
ridiculously slow in developing.
A Sensible New
Proposal on Property Taxes
The average property
tax rate in the U.S. is a startlingly high 1.38% of assessed home value every
year. That is a lot of money for tens of
millions of homeowners to pay. The state
of Hawaii has the lowest rate at .40%.
Texas has the highest rate at 2.57%.
What, are Texans really closet socialists? (“There you go again, Tiffany!”)
Considering the fact
that bigger homes use much more energy, water and construction materials than
smaller homes, it would be a fair-minded plan to assess property taxes on a
graduated basis that rewards owners of smaller homes for their ecological
integrity, and simultaneously charges people more who choose to own excessively
resource-consuming larger homes.
Here is a fair-minded
and forward-thinking proposal for all states to consider for property taxes on
homes. Such revisions in taxes would
provide powerful incentives to reduce amounts of energy, fresh water and
materials consumed in the construction, maintenance and use of mega-homes. I suggest the following
progressively-graduated changes in property tax rates, according to the size of
House Size Proposed Change in
Real Estate Taxes
Under 1,000 sq. ft. Reduce current property
taxes by 25%.
1,001 to 1,500 sq. ft.
Reduce current property taxes by 12%.
1,501 to 2,000 sq. ft. Leave tax rates unchanged.
2,001 to 3,000 sq. ft. Increase current property taxes by
3,001 to 5,000 sq. ft. Increase
current property taxes by 50%.
5,001 to 7,500 sq. ft. Increase
current property taxes by 75%.
7,500 sq. ft and larger Increase current property
taxes by 100%.
The net result of this
change should be calibrated to result in a net increase in revenues from
property taxes. The additional revenues
generated should be used to provide support for improvements in the physical
infrastructure of communities, and to finance costs of first responders to
emergencies. A contribution should also
be allocated to the maintenance of open spaces and local, regional and state
Some communities have
given eminently sensible consideration to a maximum limit on the size of homes,
like a maximum of 15,000 sq. ft. in Aspen, Colorado and less than 2,800 sq. ft.
in Crested Butte. Since Americans love
freedom to do as they please, a property tax plan like this would allow people
the freedom to build monster homes, but sensibly require them to pay
significantly more for the profligacy of that privilege and their lavish use of
the Earth’s resources.
Another Angle in the
Dysfunctionality of Political Problem-Solving
Almost every state in the USA faces budget
shortfalls because of economic conditions and budget squeezes. Opposition by conservatives to tax increases
of any kind has caused most states to make draconian cuts to education, social
programs and law enforcement. By this
refusal to find ways to
responsibly raise revenues, conservatives are causing spending to be slashed on
public services and programs that benefit important constituencies like
children, college students, and poor people.
Better management and more sensible compromises should be made to solve
California, which often leads the nation in
trends, passed a ‘taxpayer revolt’ initiative in 1978. Known as Proposition 13, the “People’s
Initiative to Limit Property Taxation”, this law reduced property taxes by 57%
at the time. Now, almost 40 years later,
provisions of this law have created bizarre inequities in real estate
taxes. New homeowners pay much more in
taxes than their neighbors who have owned their homes for a long time. This tax inequity also extends to commercial
real estate, creating absurd tax unfairness for newer businesses. This has a regressive effect of shifting a
larger share of the tax burden from long-time homeowners and businesses to new
homeowners, new businesses, younger people, and other taxpayers.
Proposition 13 thus creates another form of
‘generational injustice’ that is somewhat similar to the federal government’s
debt-financed mortgaging of the future and the aggregate squandering of natural
resources. Another seriously detrimental
aspect of Proposition 13 was that the law included a provision that required a two-thirds majority of state
legislators to approve any kind of tax increase in California, not just
increases in property taxes. This
supermajority requirement has made it difficult to govern the state. The impacts on cities and localities have
been distinctly negative. The
devil being always in the details, what made sense in many respects in 1978 has
become dysfunctional and calamitously unfair for millions of Californians
today. It has also contributed to the
inability of politicians in the state to sensibly deal with problems. If conservatives have their way, demanding
tax cuts in response to almost every issue, California’s experience will become
the norm for all states.
Ramifications of Educating and Empowering Women
As these mega-trends play out, politics in the U.S. has become
increasingly polarized. In the past two
decades, a culture of confrontation has replaced any
semblance of working together to find consensus win/win solutions to problems.
Both sides of our American partisan political divide seem excessively
preoccupied with gaining power and pandering to wealthy donors and corporations
to retain their position, instead of being committed to actually enacting good
solutions to problems.
aspect of intense competition has resulted in increasingly bitter partisanship
and political gridlock. It is
principally because of this partisanship that we have had so difficult a time
reforming our costly and unfair healthcare system, or enacting stronger
regulations on banks and Wall Street financial institutions, or extricating
ourselves from costly wars abroad. The dog-eat-dog character of our capitalist system amplifies this trend,
and as a result, inequities and anxieties and stresses in our society are
getting worse, and our national debt is becoming dangerously large. At the same time, competition for power and
influence is getting more intense between conservatives and progressives, and
it has become harder to enact policies truly oriented toward the greater good.
But it need not
be this way. One interesting idea was
proposed by President Clinton’s first press secretary Dee Dee Myers, who makes
a convincing case in her book Why Women
Should Rule the World that very positive alternatives exist. She writes that by taking steps to educate
and empower women, we would likely improve cooperation in our societies and
make our world more collaborative and peaceful.
This would be one form of salubrious ecological intelligence! Vote for women to represent you in the Senate
This makes me think of Woody Allen’s film Whatever Works. The story presents a set of
thought-provoking relationships that center around Boris, an eccentric New
Yorker who is cynically realistic about life.
Boris is played by Larry David, the co-creator of the TV comedy Seinfeld.
Boris is philosophically cerebral, but after meeting an attractive
young Mississippi woman who is sleeping on the street, he shares some
meaningful interactions with her that brighten his life and help him realize
that each of us should seek to be less judgmental of others and try to find
greater meaning in our lives. “Whatever
works!” A long train of entertaining
developments takes place in the film before Boris concludes that each of us
should seek whatever satisfactions and love we can find in our personal
relationships in this challenging world.
In addition to such wise sentiments, it
seems to me that there is an overarching importance for us to find ways to
ensure that we leave a thoughtfully fairer legacy to our descendants.
On Economics and the Government
Economics is a
field of speculation about the aggregate behavior of human beings, as reflected
in markets, prices, and the production and consumption of goods and
services. It deals with issues like
supply and demand, employment, monetary policies, resource allocation, theories
of value, rational choices, opportunity costs among alternatives, and
incentives and disincentives. Microeconomics
examines economic behaviors of individuals and businesses, while the larger
picture macroeconomics addresses aggregate issues of unemployment, inflation,
and monetary and fiscal policies.
Every nation in
the world follows its own hybrid of private and public enterprise, of
decentralized activities and centralized regulation. Our goal should be to
optimize this balance, and we should honestly debate where this balance
lies. The fairest way for people in a democracy to find this balance is to
objectively evaluate the evidence, listen well to those on the left and those
on the right and those in the center, and to judge the merits of the various
contentions, and to sort out the facts, and to discount ideas that are
beneficial only to narrow constituencies.
The smartest compromises for the greatest good should then be
implemented. Common sense tells us that
to achieve this goal, we should reduce the domineering influence of Big Money
in our decision-making processes!
A Brief History of Economics
Economists have been called “worldly philosophers”
because they seek to explain the most worldly of all of humankind’s activities
-- the drive for wealth. Economists seek
to understand the expression of human nature that is reflected in markets and
in the hard-fought struggle between capital and labor. The first famous economist was Adam Smith,
who in the year 1776 propounded his best-of-all-possible-worlds belief that the
mechanisms of supply and demand should naturally lead to fair prices, proper
resource allocations, and progress toward making everyone better off. He optimistically believed that an “invisible hand” guides people by means of their natural self-interested human impulses and competitive striving. He opined that this guidance tends to
increase profits for both entrepreneurs and investors as well as wages for
Adam Smith was right about this when private returns
and social benefits are well aligned.
Such an alignment is not always the case, as when the pursuit of
self-interest by bankers created a financial crisis that was exceedingly costly
to billions of people worldwide.
Most worldly philosophers after Adam Smith
were less sanguine and less optimistic than he was. They recognized the risks of rapid population
growth and systemic failures and resource depletion, as well as the anti-social
nature of monopoly power, unfair competition, ruthless exploitation, rash
risk-taking, and calamitous “tragedy of the commons” outcomes. As
economic thought evolved after Adam Smith, Thomas Robert Malthus
pessimistically pointed out that, in the year 1800 at a time when there were
just one billion people on Earth, human beings reproduce at such rates that
human numbers would inevitable outstrip all possible means of subsistence. Fellow economist David Ricardo saw bitter
conflict between industrialists and workers and landlords, and he believed that
only the narrow interests of landowners would have dominating force.
The early decades of the Industrial Revolution were
characterized by extensive social ills, brutality and disruptive demographic
upheavals. In reaction, Karl Marx and
Friedrich Engels wrote the Communist
Manifesto in 1848, calling for workers to unite to triumph over
capitalists. They predicted that
capitalism would inevitably collapse due to its big shortcomings. These faults include monopoly abuses, a
propensity toward the exploitation of workers by ruthless capitalists, and
disruptive and damaging boom-and-bust cycles.
By the end of the nineteenth century, the conglomerate power of
corporations had grown to such an extent that giant companies like Standard Oil
had to be broken up during the trust-busting Progressive Era, and many
fair-minded reforms were enacted to correct harsh working conditions and limit
long working hours, child labor abuses, corruption and injustices.
Further changes in economic understandings and
governance took place as a result of the cataclysmic Great Depression of the
1930s. Far-reaching reforms were made to
the banking system and labor laws, and a social security safety net was created
to protect workers from the calamitous effects of speculative excesses and
boom-and-bust cycles and increases in economic inequities. After World War II, many initiatives were
enacted like the G.I. Bill that helped build a stronger middle class. These programs fostered a general prosperity
during the 1950s and 1960s.
By 1980, powerful interests reacted to the reforms
that had limited their ability to dominate the economy and gain most of the
benefits of economic activities for themselves.
Ronald Reagan launched his economic revolution, bringing a new ideology
to dominance that advocated higher military spending and regressive changes in
taxation that primarily benefitted the wealthy.
Unfortunately, his doctrines involved risky banking deregulation, union
busting and large increases in deficit financing. Since then, conflicts of ideas and the strife
between powerful dominating interests and the common good have intensified. Economic disasters have taken place due to
deregulation and excessive speculation, yet it has proven extremely difficult
to propitiously reform our dysfunctional systems.
Observations Concerning the Economic Doldrums
Ben Bernanke, the former Chairman of the
Federal Reserve, once said that the search for the root causes of the Great
Depression is an intellectual and practical challenge that is “the holy grail
of macroeconomics.” Bernanke was a
scholar of the Depression and of the mistakes made at the time by the Federal
Reserve Bank that caused the severe downturn to worsen. The Fed at the time raised interest rates,
tightened credit, and let thousands of banks fail.
In order to cope with the severe 2008-2009
financial crisis, Ben Bernanke pursued policies that were the opposite of those
used by the Federal Reserve during the Depression. The Fed reduced interest rates, flooded
credit markets with enormous amounts of money and bailed out big banks. This was a strategy that eventually warded
off the liquidity crisis, so Bernanke seems to have been the right man in the
right place at the right time to deal with the risk-laden collapse of the
amped-up real estate bubble and the confidence-shattering wake of associated
credit availability problems. He was
quite flexible and creative, and even desperately improvisational, in acting to
prevent the financial crisis from developing into a full-blown economic
Confidence, it turns out, is critically
important to a healthy economy. When
customers feel secure enough to spend the money they earn, and lenders are
willing to freely lend money, employers feel optimistic enough to hire more
workers. Financial markets, once
disrupted, can enter a vicious spiral of self-fulfilling uncertainties that can
result in constricted availability of credit and intensified systemic risks
that tend to exacerbate an economic downturn.
But since Ben Bernanke’s success depended
on flooding the system with newly printed money, he effectively laced the
proverbial punchbowl with stimulative credit.
Congress reluctantly went along, stimulating the economy by spending
hundreds of billions of dollars, increasing budget deficits and the national
debt. This bold strategy is having
negative unintended consequences, and could cause future economic turmoil. It will be a risky high-wire act to remove
this debt-financed stimulus before the financial party gets out of control once
again. Alan Greenspan failed to do this
years ago, when his policies encouraged the inflation of the real estate
bubble, and he did not take steps to prevent the bubble from getting too
big. So it will be a serious test of the
Federal Reserve’s effectiveness to manage better in the coming months and
years, as discussed in detail below.
We have sown the seeds of the next crisis
with all this unprecedented borrowing and spending. I strongly believe the Fed should take a more
courageous position on the inadvisability of enormous amounts of deficit
spending and large increases in the national debt. Unprecedented government stimulus spending
and borrowing were the very remedies used by the federal government to prevent
a worse recession, so such tactics will no longer be tenable if the next crisis
is caused by too much debt and too much money in circulation.
The reason that shortsighted expediencies
are likely to be the cause of the next economic bust is that China and Japan
and other nations that help finance our deficits by buying American Treasury
securities may eventually be forced to realize that the U.S. is unable to rein
in its undisciplined finances. If they
stop buying these securities, interest rates would be driven up dramatically,
causing a serious economic emergency.
This disaster could be avoided if we were to demonstrate an ability to
more responsibly control government spending and enact more progressive
taxation plans to reduce on-going deficits.
Our political representatives, however, seem committed to win/lose
gamesmanship, which tends to make fair compromises less likely. Change must come!
Do Deficits Matter?
John Talbott, the author of Obamanomics: How Bottom-Up Economic
Prosperity Will Replace Trickle-Down Economics, wrote that the U.S. is
hamstrung by its reckless reliance on the expansion of debt by individuals,
corporations and government. It is
foolish to borrow so much money to finance rates of consumption that are not
sustainable. Talbott argued that since
the federal government must print more and more money to finance its deficit
spending ways, this inflation of our currency is “the only way to deflate the value
of debts on everyone’s balance sheets at the same time.” This strategy is risky because inflation has
the extremely damaging effect of undermining real economic growth and true
prosperity. The U.S. has been
irresponsible to base its economic well-being on shaky foundations like
stimulated consumerism financed by inflationary monetary policies and
ever-greater levels of borrowing.
We have backed ourselves into a desperate
corner. Addicted to bubble economics, we
have gambled on getting the real estate and equities bubbles inflating once
again. This is essentially a way of
doubling down on our bad past gambles --- a generally risky and unwise course
Strategies that create boom-and-bust cycles
lead to economic recoveries after recessions, and to big corporate profits
before the next down cycle. If we were
to use this crisis to honestly address the problems that underlie our
short-term oriented plans, it would be smarter.
Our economy should be restructured to bring into better balance the gains
from productivity and the earnings from work efforts. This would help ensure financial stability
rather than causing periodic short-term-oriented booms and ruinous busts.
financial markets may provide high rates of return in the short run, but it
helps create economic bubbles that inevitably burst and create severe economic
instability. The housing bubble was
inflated by many means, for instance, and it may have been ‘great’ while it
lasted, because sure enough it provided huge amounts of borrowing against
increases in home equity. This
stimulated consumer spending and facilitated highly-leveraged investing, but it
was a risk-filled course of action that resulted in devastating impacts on many
homeowners. Stimulating the real estate
bubble had the collateral effect of making housing less affordable for millions
of people, and it eventually caused the international economy to be
destabilized, with extremely harmful consequences. European countries, in particular, are still
reeling in the aftermath.
High levels of deficit spending guarantee higher
inflation in the long run, and this has the insidious effect of eroding the
purchasing power of people’s savings, and acts as a hidden tax on everyone in
the future. This is why $100 today is worth
the equivalent of only $20 in 1972 dollars. The value of our currency has been deflated
by this national policy, as set by the Federal Reserve in a tacit collaboration
with our political representatives.
Inflation is regressive, like a flat tax, so it disproportionately
affects the least prosperous people.
Inflation thus acts as an insidious force that is the opposite of fairer
ideas like balanced budgets financed by more steeply graduated tax rates.
Deficit spending and
increases in the national debt have the effect of creating wealth for people
today by borrowing money from people in the future. This expediency, together with inflationary
monetary policies, results in shortsighted and unfair outcomes, eventually
stoking inflation and disproportionately affecting poor people and those in the
middle class. It also benefits
capitalists and financiers at the expense of workers, whose wages are the last
thing to increase during cyclical periods of high unemployment and inflation.
Our representatives would be forced to be more
honest in making difficult spending decisions if we responsibly moved toward
requiring a more nearly balanced federal budget. They would need to decide what real
trade-offs to make in our messy and poorly prioritized budget process. We avoid making these hard choices by
allowing the expediency of ever-growing deficits and national debt, but we
should not make the mistake of thinking that in the long run this will be less
costly than more responsible fiscal decisions.
If American citizens
more clearly understood the correlation between the level of deficit spending
and the long-term average rate of inflation, they would likely be more
supportive of national mechanisms that mandate lower deficits. Reining in deficit spending will entail hard
decisions about spending and revenue-raising, and create challenging
determinations of how to prioritize national spending. Fiscal responsibility and respect for the
rights of people in the future make it necessary that we stop using the short-term
expediency of deficit spending all the time.
Several years ago, a national newspaper presented
opposing perspectives concerning the question of the risks of a rapidly growing
national debt. Respectable economist
James K. Galbraith argued that deficit spending is nothing to worry about; he contended, in fact, that the fear of
deficits itself poses a greater danger.
An opposing point of view was proposed by Lawrence Grossman, a financial
planner who claimed that the U.S. is a “negative-amortization nation”. By this, he was referring to the fact that we
are adding liabilities for government obligations and interest expense to the
principal of our national debt every year.
“We as a country are heading for a fiscal train wreck”, he
asserted. Rapid increases in the
national debt in recent years are risky, he noted, pointing out that the real
national debt is much bigger than the official national debt because of
obligations like Treasury bonds and huge unfunded commitments by the government
to provide benefits like Social Security and Medicare far into the future.
My intuition tells me there is truth in both points
of view, but that the latter one is more valid as a cornerstone of necessary
precautionary action. Tax cuts financed
by money borrowed from people in the future are surely a form of
inter-generational exploitation that is outrageously unwise and distinctly
unfair to our descendants.
John Maynard Keynes
We have been
irresponsibly avoiding making sensible decisions about the trade-offs involved
in budgetary decisions, but we should begin to use deficit spending only in the
way that the famous British economist John Maynard Keynes (pronounced
recommended: as a needed stimulus during
economic contractions to mitigate the economic and social harm of recessions,
and NOT as an acceptable policy each and every year even during economic
expansions. By allowing our
representatives from both political parties to indulge in the expediency of
deficit spending ALL THE TIME, we are choosing the insidious and regressive,
but very real costs, of eventual higher rates of inflation or of a severe debt
John Maynard Keynes’ most influential
work, The General Theory of Employment,
Interest, and Money was published in 1936, during the Depression. In
it, Keynes argued "recessions don't fix themselves", so to correct
the severe problems caused by downturns, a proactive effort by governments is
needed to stimulate the economy. This
book helped establish Keynes as “the father of macroeconomics”, and his ideas
still guide governments and fiscal policymakers worldwide to stabilize
economies and to keep economic growth from being too fast or too slow.
essentially suggested that, when the economy is growing quickly, governments
ought to raise taxes and decrease spending in order to rein in inflation. When the economy falls into a recession, he
recommended that governments should lower taxes and increase spending to
kick-start economic activities. This
concept of balanced growth, if followed, would likely have softened the blow of
the Great Depression. Such forms of
government intervention continue to work reasonably well today; the Fed still raises and lowers interest
rates to balance growth and to moderate the rate of inflation.
was a participant in the conference that led to the creation of the World Bank
and the International Monetary Fund.
These two institutions helped shape and stabilize the post-World War II
global economy. Keynes poked fun at
conservative bankers in A Tract on
Monetary Reform by saying that bankers strived “to shift public discussion
of financial topics off the logical onto an alleged moral plane, which means a
realm of thought where vested interests can be triumphant over the common good
without further debate.” Gee, this
version of history seems to be repeating itself these days!
A challenge to Keynes’ theories came during
the years of stagflation following the 1973 and 1979 oil shocks. Keynesian theory had no appropriate policy
responses to the oil supply shocks and the high rate of inflation during the
1970s. The economist Milton Friedman
argued convincingly that high rates of inflation were caused by rapid increases
in the money supply. One key to good
stable policy is thus to reasonably and responsibly control the money supply.
The nature of our
system, perversely, is that our representatives fight tooth and nail over which
domestic priorities to spend money on, always cushioned by the expediency of
deficit financing. Our current national
priorities, being unduly determined by corporate interests, are not generally
consonant with the best interests of the majority of Americans. Additionally, we never seem to consider the
financial costs of the military and wars, which we commit to without adequate
regard for how the costs will eventually be financed, and by whom.
is notorious for having observed, “In the long run, we are all dead.” Sure, John Maynard, but we will have
descendants, and we cannot neglect their interests in our excessive willingness
to allow narrowly selfish constituencies to gain unfair and unaffordable
Cultivating a Better Understanding of the
A big picture evaluation of mega-trends and
overarching considerations is needed to assess the global economy and our
addictions to growth in consumption and an increasing money supply and an
ever-larger human population. We need to
clearly comprehend the aggregate risks associated with these strategies. We need to see where we’ve been and what has
happened with initiatives that eliminated common sense rules governing banks
and other corporations. We need to
understand how economic bubbles have been inflated and why they have collapsed. We also need a more accurate crystal ball and
greater courage in the face of the astonishing force of inertia and the power
of vested interest groups in dominating the rigged status quo.
We should think like firefighters in a burning
building, and we should simultaneously think like the fire chief who is responsible
for mitigating the risks posed by conflagrations to come. Better yet, we should think like leaders with
responsibilities for bigger picture plans like fire safety codes, zoning
restrictions, and the environmental impacts of real estate developments.
“Lords of Finance” were the most influential bankers of the United States,
Britain, France and Germany during the period from just before World War I
through the Roaring Twenties and the Great Depression. Their names -- Benjamin Strong, Montagu
Norman, Emile Moreau and Hjalmar Schacht -- are practically unknown today, but
these men had enormous power during some of the most turbulent times in the
history of the world. The Panic of 1907
had made it clear that a central banking institution of some sort was needed in
the U.S. to deal with the systemic risks that capitalist economies faced when
credit crises periodically occurred and economic bubbles burst and depositors
made panicky runs to take their money out of banks.
created the Federal Reserve System in 1913 in response to the need made clear
by such economic crises. Just before the
outbreak of war in Europe, the economies of the world were still anchored to
fixed exchange rates and currencies backed by gold. The enormous costs of the First World War
were financed by debt and rampant printing of money by all the warring
nations. This led to crippled
international finances and high inflation rates.
the war, Germany was saddled with enormous “reparations” obligations, so it continued
to print vast quantities of money. The
German currency, the Deutsche Mark, had had an exchange rate of 4.2 to the
dollar in 1914, and it depreciated to 4.2 trillion to the dollar by
1923. This hyperinflation practically
destroyed the German economy, so it is a cautionary tale that should motivate
responsible central bankers to remain mindful of the risks of printing too much
The four main responsibilities of the Federal
Reserve are: (1) to conduct monetary
policy in a way that leads to stable prices and maximum employment; (2) to
maintain the safety and soundness of financial institutions; (3) to limit
systemic risk in financial markets; and (4) to protect consumers against
deceptive and unfair financial practices and products. Some say that by any sober assessment of the
facts, the Fed has not been successful enough in ensuring the stability of the
financial system, or in keeping economic bubbles from growing too large, or in
creating maximum employment, or in protecting taxpayers from bailout costs or
consumers from predatory banks.
The emphasis by
central bankers on the growth of the money supply at the maximum rate that can
be sustained without causing too rapid a rate of inflation actually serves to
increase the potential for systemic crises.
A vigorous action of central bankers whenever deflationary pressures
develop also creates systemic risks. We
should honestly strive to understand the trade-off between inflation and
unemployment, and who the winners and losers are in Fed monetary policies.
are beyond full comprehension, and the Fed may actually be doing a generally
good job of managing capitalism within the constraints of our political system. But the system itself has deep underpinnings
of folly and unfairness. The Fed’s
sophisticated role in managing our economy by manipulating the money supply and
interest rates can be seen as an official means of slowly expanding the money
supply and causing an insidious inflation that diminishes the value of
savings. Not only does this act as a
“hidden tax” on money saved, but it could also weaken the dollar relative to
other currencies, with far-reaching ramifications and many less than desirable
In 2009, Congressman Ron Paul of Texas wrote in The Revolution – A Manifesto that when
the Fed prints up more money, the increase in the total supply of money
diminishes the value of all money already in the system. This tactic has the effect of redistributing
wealth from the poor and middle class to those who are politically
well-connected. This occurs because of
the “distribution effects” of inflationary processes, in which big banks and
other insiders are enriched at the expense of all others. As prices increase, wages are the last thing
to go up in response to inflationary monetary policies, so workers pay more for
things long before their earnings increase.
Inflation thus disproportionately hurts workers, as well as those who
save money or live on fixed incomes.
hundred years ago, the founder of the House of Rothschild made the following
observation: “Let me issue and control a
nation’s money and I care not who writes the laws.” The Federal Reserve controls the money
supply, so it is crucial we understand its role. We should make sure that the Fed is effective
in ensuring the common good -- and not just the best interests of bankers,
privileged people, and self-serving constituencies.
To better understand
just how our system has been rigged by the financial and political elites, I
highly recommend watching Charles Ferguson’s documentary film, Inside Job.
Think about the situation of Brooksley Born, the head of the
Commodity Futures Trading Commission in 1997.
She recommended regulatory oversight for complex financial derivatives
like mortgage-backed securities and credit default swaps. For her courageous advice, Ms. Born suffered
rude and harsh criticism from financial decision-makers and insiders like
Treasury Secretary Robert Rubin and Fed Chief Alan Greenspan. The upshot was that these types of financial
instruments were not regulated, and this failure was a causative factor in the
extremely costly global economic meltdown of 2008-2009. This outcome confirms that the crisis should
truly be regarded as an inside job!
Bizarrely, no changes have yet been made to control these “financial
instruments of mass destruction.”
A report issued in early
2011 by the Financial Crisis Inquiry Commission concluded: “The enactment of legislation in 2000 to ban
the regulation by both the federal and state governments of over-the-counter
derivatives was a key turning point in the march toward the financial
crisis.” Deregulatory dogmas, in other
words, helped spark risky speculation and inadequately limited leverage, and an
accompanying lack of good transparency increased systemic risks. Requirements for collateral on loans were
inadequate, and so were requirements for bank capital. Four years after the depths of the financial
crisis, the Financial Crisis Inquiry Commission Report stated: “the U.S. financial sector is now more
concentrated than ever in the hands of a few large, systemically significant
institutions.” The risks inherent in
this state of affairs are numerous.
In April 2015,
the valuations of technology companies in China’s stock market had been so
stoked by speculative encouragements that price-earnings ratios were much
higher than they were at the top of the tech bubble in the U.S. in 2000. The average ratio of stock price to earnings
reached 156 back then in the U.S., which was absurdly and unsustainably high,
so to then see China’s tech sector valued at more than 200 times earnings sent
a cautionary signal. A huge bubble
seemed destined to collapse that would have ominous implications for Chinese
speculators and possibly economies worldwide.
We should have been positioning our national finances more securely in
preparation for the risks to come, instead of running up our national debt up
to dangerous levels. In June 2015, the
Shanghai Composite Index began a rattling decline that exceeded a scary 40% by
the end of September, and has not recovered any by the end of June 2016.
Ferguson says that before making Inside
Job, he had “grossly underestimated the level of extraordinarily unethical
and even fraudulent behavior that had occurred on such a large scale.” Our prisons are full of people who commit
small crimes, but it seems that those who think big and rip off the nation for
enormous sums of money are never held accountable. Here is another reason people with lots of
money should be required to pony up more of their high-end gains in taxes, if
only to finance the obscene costs of incarcerating so many people in prisons!
Audit the Fed!
Central bank monetary policies can cause
misallocations of resources and distorted investment decisions. The motives of private bankers and the Fed in
getting the federal government to pursue the policies they do should be better
understood. Representative Barney Frank of Massachusetts and Congressman
Ron Paul once sensibly called for an audit of Federal Reserve policies to
determine the actual role of the Fed in the destabilizing Wall Street schemes
of the last decade. One can just imagine
how politicized such an audit could become.
But it would be foolish to suppose that a high-level evaluation of Fed
actions by a group of prominent economists of all stripes would not be a good
idea for better planning, today and in light of the potential for future
economic crises. A detailed
consideration of the impacts of Fed actions could provide clarity so that we
would better understand the ways that private bankers provide benefits to elite
segments of society at the expense of all others in our capitalist economic
Such a blue-ribbon commission could make some
valuable recommendations. Maybe they
would suggest that we pay more attention to fundamentals and simplify our laws
and remove some of the favors and subsidies and complexities and
dysfunctionality in our economic system.
As Thomas Paine expressed in Common
Sense, “the more simple any thing is, the less liable it is to be
disordered, and the easier repaired when disordered.”
Does the Fed
Contribute, by Design, to Booms and Inevitable Busts?
Federal Reserve policies
are an art, not a hard science. The Fed
is supposedly independent from the federal government, and yet it serves the
interests of the establishment, and not necessarily the interests of the common
good. The Federal Reserve is a prime
enabler, for instance, of the overarching schemes of deficit spending and
inflationary growth of the money supply and economic bubbles.
The Fed unquestionably
operates within a complex constellation of competing objectives and powerful
economic, social and political forces.
Federal Reserve officials make an arcane cost-benefit calculus in their
decisions of how to use monetary policies to affect interest rates, inflation,
employment, the money supply, the ups and downs of economic activity, behaviors
of consumers and investors and bankers, and the stability of prices and the
financial system itself.
According to Friedrich
August von Hayek, the 1974 Nobel Prize winner in economics, manipulations of
interest rates and the money supply by the Federal Reserve “cause havoc throughout
the economy, and set the stage for an inevitable bust.” It appears that the policies of the Fed are
boom and bust by design, whether or not the decision-makers admit this. The Fed strives to avoid deflation at all
costs, and to maintain a moderate rate of inflation that tends to benefit the
rich, because the wealthy can exploit heightened opportunities for
profit-making during good times and, if they are smart, they can also find ways
of protecting themselves and doing well on the downside and the rebound. Policies that contribute
to economic busts create periods of high unemployment, so they directly
victimize middle class workers and poorer Americans.
The boom-and-bust nature of our economic system is
directly related to the monetary policies of the Federal Reserve. Inflationary increases in the money supply
cause inequities and misallocations in the economy and an artificial prosperity
in the short term. When these activities
eventually drive up interest rates, the higher rates have the effect of
crowding out sensible investments and giving greater impetus to recessionary
The Fed rapidly increased the money supply during
the 2008-2009 recession. This guarantees
that the economy will be whiplashed when the extremely low interest rates have
had their stimulative effect of encouraging people to once again make unwise
spending decisions and unsound investments.
The short-term false prosperity that is generated has the unfortunate
adverse effect of assuring future dislocations.
Far from contributing to sustainable growth and wise investments, this
aspect of casino capitalist systems is destabilizing, so it is not an
acceptable strategy for long-term well-being!
holding interest rates at extremely low levels, the Fed is effectively discouraging
savings and penalizing frugal people. It
encourages wasteful spending and rash risk-taking, and creates the beginning of
another series of misallocations of capital.
It is encourages market participants to take bigger risks than they
would otherwise, so people make bigger speculative gambles and often
“Spending trillions of
dollars trying to fix Wall Street is a fool’s errand. Our hope lies not with the Wall Street
phantom-wealth machine, but rather with the real-world economy of Main Street,
where people engage in the production and exchange of real goods and services
to meet the real needs of their children, families, and communities, and where
they have a natural interest in maintaining the health and vitality of their
--- David C. Korten, Agenda for a New Economy
Insightful journalist John Cassidy makes a similar
argument in the well-considered ideas he presents in How Markets Fail – The Logic of Economic Calamities. He analyzes all the ideological arguments
of ‘Utopian Economics’ in Part One of this book, and then in Part Two he
examines the provocative ideas of ‘Reality-Based Economics’. It would be a better world if all members of
Congress and think tanks were to read this book and take it to heart by heeding
the ideas and recommendations it sets forth.
Financial markets can be seen throughout history
to be prone to the creation of asset bubbles, so regulators like the Fed, the
Treasury Department, and the Securities and Exchange Commission should be given
greater responsibility for seeing that economic bubbles do not grow too large
in the future. Speculative bubbles can
be controlled by tightening the money supply and maintaining sensible margin
and minimum capital requirements for speculators. The amount of leverage and risk that market
participants can employ should be more sensibly limited. Smart and reasonable new regulations and
government oversight should be implemented, especially of the tens of trillions
of dollars of arcane unregulated derivatives like mortgage-backed securities
and credit default swaps. At the same
time, unduly excessive regulations and bureaucratic red tape should be
With our national debt at unprecedented levels and U.S. money
printing presses running at full tilt, the Federal Reserve is continuing to
indulge in highly stimulative monetary policies.
The Dow Jones Industrial Average began reaching a succession
of new all-time highs in March 2013, finally exceeding its pre-recession record
level set in March 2007. After setting that record in 2007, the Dow Jones had
fallen more than 50% by March 2009, so the collapse and recovery involved
dramatic volatility. One analyst
expressed the opinion that one of the next big problems is “how to normalize
monetary policy without causing some bad fallout”. In other words, how can the Federal Reserve
take away its highly stimulative low-interest-rate policies and its lavish
buying of Treasury securities, and slow the printing presses, without causing
another economic recession and another big decline in equity prices. The Fed Chairman Ben Bernanke at the time
promised the Fed would “pick the right moment to begin removing accommodation
and taking away the punch bowl.” We
shall see. Other roiling factors loom,
like the Brexit market turmoil in late June 2016.
History provides us with a caution flag to see things in a
bigger perspective, and to temper the excessive rashness of speculative
exuberance in national planning. Just
consider the schemes involved in some early economic bubbles. Two of the most colossal economic collapses
in European history took place in 1720.
One involved the South Sea Company in England. This partnership of
public and private interests was chartered to consolidate and reduce the cost
of a large national debt incurred in connection with England’s involvement in
the decade-long War of the Spanish Succession.
In this ill-fated scheme, the South Sea Company was granted a monopoly
to all trade with South America, and it soon became a vehicle for
speculation. The company’s share price
was driven up by disingenuous claims, scurrilous insider trading, political
bribes and poor management. Wikipedia
elaborates: “The expectation of vast wealth from trade with South America was
used to encourage the public to purchase shares, despite the limited likelihood
this would ever happen. The only
significant trade which did take place was in slaves, but the company failed to
manage this profitably.” Nice going!
The value of shares in the South Sea Company spiked upwards in
early 1720, but by the end of the year the bubble had collapsed, ruining many
people and sending the economy into a recession.
Another instructive and cautionary episode took place in
France in 1719 and 1720. King Louis XVI
had died in 1715, after a 72-year-long reign “that had begun in the glory of
martial triumphs, the brilliance of literary masterpieces, and the splendor of
baroque art -- and had ended in the decay of arts and letters, the exploitation
and impoverishment of the people, and the defeat and humiliation of
France.” The new King, Louis XV, was
only five years old at the time his great grandfather died, so Philippe II, the
Duc d’Orleans, was chosen as Regent to lead France. He inherited a heavily indebted government
that was basically bankrupt, so he tried austerity measures and reductions in
the size of the army, and he instituted tax reforms to get France back on its
feet. But the system was too corrupt to
be easily fixed. So the Regent “gave ear
to a remarkable Scot, John Law, who offered him a new system of finance,”
according to historians Will and Ariel Durant.
John Law advocated the magic of a credit system that used paper
money instead of relying on reserves of gold and silver. Paper money could be issued that was many
times the value of reserves held in gold, so the gambit stimulated and
facilitated commercial activities. John
Law’s central conception was to increase the employment of men and materials by
issuing paper money on the credit of the state, and by lowering interest
rates. This strategy encouraged
businessmen to borrow money for new enterprises and to more quickly exploit
resources and innovative methods in industry and commerce. By this means, paper money would stoke
business activities, increase employment and production, and cause national
revenues and reserves to rise. More
money could then be issued, and a beneficial spiral of prosperity would theoretically
Philippe agreed to let John Law establish a private Banque
Générale in 1716 to accept deposits, pay interest, make loans, and issue its
own bank notes. These notes were the
first regular paper money in France. The
initial steady value of this currency soon made the notes a preferred medium of
exchange, and the Banque Générale basically became France’s first central
bank. The principles upon which John Law
established his bank were more-or-less sound, just like the principles are of
the Federal Reserve’s fractional reserve banking system today. But that only remains true when there are
reasonable limits on leveraging in place.
Doggone it, though, poor management and extravagant speculation soon
drove the French economy to ruin.
Here’s how it happened.
John Law was given a monopoly in the Mississippi Company in the American
South, and he began issuing shares that were hyped up in an effective marketing
scheme. Rash speculation ensued. The shares gained value in a wild speculative
bubble throughout 1719 and early 1720, gaining almost 2,000% in one year’s
time. But then this Mississippi Bubble
burst, causing very high inflation in France -- 23% in the month of January
1720 alone. As a consequence, the Regent
was forced to abolish the bank and fire John Law, and France experienced
renewed economic turmoil.
it was exactly 200 years later, in 1920, that the notorious scheme of con
artist Charles Ponzi caused havoc in financial markets in the United
States. Ponzi hyped up a “rob-Peter-to-pay-Paul”
scheme with a fictitious story about profits being earned on foreign postal
reply coupons, and speculation became crazed.
By August 1920, however, the entire scheme collapsed. One reasonably might wonder if the U.S. will
be able to delay its own day of reckoning until 2020 before our own unwise
national policies and depletionary enthusiasms lead to another severe economic
The Wisdom, or Folly, of Central Planning
Centrally-planned economies were proven to be much
less effective than capitalist economies during the intense competition of the
Cold War. It is thus deeply ironic that
we have allowed our monetary system, which is the very heart of our economy, to
be centrally planned by a group of bankers at the Federal Reserve who game
the system with favoritism of bankers and insiders, and unfair treatment of
Former Fed Chairman Alan Greenspan made the
observation in The Age of Turbulence
that centrally-planned economies have been proven to be failures. But this casts a curious suspicion on the
wisdom of having the money supply and interest rates planned and controlled by
a central bank. The Fed is a
centrally-planned regulatory institution in a jerry-rigged market economic system,
and it has ironically been antagonistic in the past decade to sensible
regulation of banks and Wall Street and financial derivatives. The regulatory agency opposed
regulation! The Fed seems to oppose any
form of central planning -- other than its own.
Even market fundamentalist Milton Friedman was in favor of abolishing
the Federal Reserve System, so more thought should be given to the role of the
Fed in our economy.
competition between nations with free market economies and nations with
centrally-planned economies during the Cold War gave proof through the fight
that a relatively free market is better at motivating people to be productive
than one planned by government bureaucrats.
Free market forces allocate resources in a more responsive way than in
totalitarian economies because they respect the aggregate forces of supply and
demand. They also are much better at
creating wealth. For exactly the same
reasons, it would seem that the control of interest rates and the money supply
by a central bank is less desirable than letting market forces determine rates
through supply and demand mechanisms. It
also seems probable that a stable money supply would be better and fairer in
the long run than huge infusions during a crisis and then periodic reflexive
The Fed should act
with a greater overarching commitment to fostering sustainable economic growth,
price stability, fair competition, and the safety and integrity of the banking
system. Some say the Fed does a good job
at this, and that it is an unbiased and honest institution that is full of
rectitude and propriety. Others have a
much more critical view of the Fed, and say that its policies are designed to
help the wealthy, and that it gives inadequate concern to poor people, workers,
the middle class and people in future generations. The Fed definitely seems to work to
perpetuate the status quo of a banking system that is dominated by big banks,
which tend to treat small borrowers unfairly in the pursuit of ever-bigger profits.
Syndrome and the Chairmen of the Federal Reserve
Investors hang on
every word of the Fed chief, who is regarded as one of the most powerful people
in the world. Bob Woodward called Alan
Greenspan ‘Maestro’ in his biography
in the year 2000. When the economic
bubble was perking along just right, and banking deregulation and leveraging
and risk-taking had not yet wreaked havoc on the economy, it seemed like
Greenspan was a genius.
Investors have a
love/hate relationship with the Goldilocks gurus of the Federal Reserve. As these supposed sages slowly inflate the
money supply and manipulate interest rates, and print up money to finance the
growth of the national debt, investments in equities seem to benefit from
rising prices in the short term, and from the economic bubbles that this
strategy facilitates. This causes
investors to feel confident that they can trust the Fed not to inflate the
money supply too rapidly -- to do it “just right” -- and to staunchly prevent
markets from ever actually undergoing any deflation.
Alan Greenspan was
regarded as the inscrutably wily apostle of economic brilliance and integrity
during his tenure as Fed chief. Wall
Street investors lionized Greenspan, and latched onto his every pronouncement
with awe and belief. They loved his
steady leadership because they had figured out how to profit from just the
right amount of inflation in the money supply.
But then the eventual bursting of the hyped-up housing bubble revealed
that his leadership and deregulatory enthusiasm had been contributory factors
in rash risk-taking and a destabilizing growth in this bubble. In clear-eyed retrospect, people have come to
regard Greenspan’s policy-making as less smart or salubrious.
introduced in the course of business-as-usual turn out to be occasionally too
risky to justify allowing the status quo to remain unchanged. Many people’s lives were seriously disrupted
by the economic hardships, stock market decline, home foreclosures, high rates
of joblessness and overly tight credit markets and deepening social stresses
that resulted from the bursting of the housing bubble in 2008. The brunt of these adversities was borne by
workers who saw their wages stagnate, and people who lost their jobs or their
homes. These same people were then
affected most adversely by cuts in outlays for social programs and increased in
When the boom turned
to a bust, the system was shown once again to have been constructed so that
profits are privatized while risks of bailing out the system are
socialized. In other words, when the
costs are shouldered by taxpayers and people in the future who are saddled with
the debt engendered by government largesse and emergency bailouts. This is a negative outcome for most
years after stepping down as chairman of the Federal Reserve, a humbled Mr.
Greenspan admitted that he had put too much faith in the self-correcting power
of free markets and had failed to anticipate the self-destructive power of
wanton mortgage lending.” He told the
House Committee on Oversight and Government Reform, “Those of us who have
looked to the self-interest of lending institutions to protect shareholders’
equity, myself included, are in a state of shocked disbelief.”
Greenspan’s successor as Fed Chairman, was named the “Person of the Year” for
2009 by Time Magazine. His leadership of
the Fed helped avert a potentially much worse global financial fiasco when the
real estate bubble burst and the severe credit crisis ensued. Bernanke seemed to be committed to doing the
right thing, and I found his words to be cogently compelling when he said:
“I want to be very, very
clear: too big to fail is one of the
biggest problems we face in this
country, and we must take action to
eliminate too big too fail.”
Eliminate too big to
fail? When, and how, will this be
done? Our political representatives
appear to be much too weak-willed to make this happen. Janet Yellen, the hope-inspiring new Fed
chief, has yet to speak forcefully on this issue, indicating that policy makers
“remain watchful for areas in need of further action.”
Instead of trust busting, the big trend today is
mergers and acquisitions. The severe
financial crisis of 2008 made it clear that we should prevent firms from
conglomerating to the point that they are too big to fail. In 2009, while ordinary workers on Main Street struggled in the worst
economic downturn since the Depression of the 1930s, financial firm employees
on Wall Street had their most profitable year ever. The insider investment firm Goldman Sachs had
the best year in its 142-year history, and it paid its employees an average of
nearly $600,000 each. The top 25
hedge-fund managers raked in about $900 million each -- and they obscenely paid
extremely low 15% capital gains rates on these ill-begotten windfall profits.
Here is another very
good reason that our system of taxation should be reformed and made more
steeply graduated, and that the outsized beneficiaries of our economy
contribute a bigger share of their incomes to the enormous needs of running our
Glass-Steagall Act should be reinstated to once again safely separate investment and depository banking, and to help
prevent conflicts of interest that encourage too much risk-taking. Banks and other corporate entities should be adequately regulated, and
financial derivatives should be subjected to oversight and sensible rules to
ensure the greater public good. Our
winner-take-all political system should be restructured to benefit the middle
class rather than allowing the rich to grab the lion’s share of the wealth
generated in our economy.
How can we bring back
the spirit of Republican Theodore Roosevelt and the trust-busters of the
Progressive Era to achieve these goals?
The Republican Party today, in particular, seems to be too corrupt to
even imagine taking a step in this direction.
entertainingly funny six-minute YouTube cartoon video, Quantitative Easing Explained, became a surprise hit after Fed
Chairman Ben Bernanke announced in November 2010 that the Fed would print up
more money to buy as much as $600 billion in long-term Treasury bonds. This action by the Fed is deceptively naked
because, qualitatively, it is a creatively expedient move that has serious
potential negative ramifications like eventually higher inflation, a weaker
dollar, and a new economic crisis.
The move was
dubbed QE2 because it follows a first round of similar stimulus in the form of
a $2 trillion increase in the money supply in 2009. That increase failed to have the intended
effect of immediately promoting economic growth and increasing the number of
jobs in the economy. The move was
partially responsible for stimulating bank profits and encouraging investments
in riskier assets like stocks and commodities and gold, but it was a short-term
oriented maneuver, not a sober and fair-minded policy. Ben Bernanke promised that the Fed would pay
attention as the economy heated up, and he reassured people that the Fed would
dampen the stimulative effects of the increased money supply when
necessary. Stay tuned!
The Industrial Revolution, the Accumulation
of Wealth, and the Conglomeration of Power
Ever since the Industrial Revolution gained a full
head of steam, corporate conglomerates and top executives, industrialists and
“robber barons” have seized advantages to make bigger profits for themselves,
and wealth has become highly concentrated in the hands of the Few. This process has taken place in benign ways
by means of fair competition, technological innovation, economies of scale,
greater efficiency and increased productivity, but it has also been
accomplished by means of reprehensible business practices that are distinctly
unfair and undesirable, including such gambits as monopoly practices, market
manipulation, price fixing and other fraudulent activities, predatory banking,
deceptive advertising, misappropriations of public funds, misrepresentations of
evidence, trade libel, and institutionalized bribery.
In a vibrant and fair democracy, the people should
be protected from underhanded business activities by rules of law that are well
designed to satisfy greater good goals.
Instead, we have policies designed by corporations, lobbyists, and
privileged people to provide loopholes and tax avoidance schemes, and practices
have been embedded that facilitate shrewd schemes and fraudulent scams.
Egregious Instances of Corporate Abuses of
The Sherman Antitrust Act was passed in 1890 to
deal with the unfair competition that had come to prevail in monopolistic
industries like railroads, big oil and big tobacco. The status quo had gotten so bad, back then,
that workers and ‘muckraking’ writers and Progressive Era politicians managed
to motivate President Theodore Roosevelt and then President William Howard Taft
to use the Sherman Anti-Trust Act to break up more than 130 business
conglomerates like Standard Oil.
Corporate lawyers and sycophantic politicians
since then have made it more difficult to prevent business conglomerates from
growing in size and power. This has
allowed corporate influence to dominate in our economy and across the
globe. Our entire market system has come
to resemble one big ‘casino capitalist’ enterprise that violates the principles
of fair competition. This system creates
extensive harm and wrong-headed priorities in most of the laws enacted either
by Congress or by legislative bodies in the states. Our government may be “the best government
that money can buy”, as Mark Twain satirically observed, but as a consequence
government entities often betray the public’s trust. The system itself must be reformed!
One of the most egregious exemptions from
anti-trust law today is one related to health insurance companies. The McCarran-Ferguson Act of 1945 exempted
these companies from federal antitrust regulations that theoretically apply to
nearly every other industry. Such rules
had originally been designed to protect consumers from anti-competitive
business practices. The suspension of
these rules has led to a dramatic consolidation in that industry, allowing
health insurance issuers to engage in price fixing, excessive profiteering, bid
rigging, and other monopoly practices.
The associated lack of competition is disadvantageous to the vast
majority of Americans. Partially as a
result, the costs of health insurance have increased far faster than the
general rate of inflation for every year in the past two decades. This makes the lives of millions of people
more challenging than necessary!
The anti-trust exemption for health insurance
companies has allowed near monopolies to develop in many regional markets. One or two companies control 75% to 95% of
the market in many states. This
dominance leads to inadequate price competition and other negative
Senator Patrick Leahy of Vermont introduced
a bill in 2009 called the Health Insurance Industry Antitrust Enforcement
Act. This law, if enacted, would have
repealed the antitrust exemption for health insurance companies and fostered
more competition. President Obama stated
that it was time to repeal the McCarran-Ferguson Act, and hearings were held in
the Senate Judiciary Committee in October 2009.
Since then, however, the health insurance industry succeeded in using
its powerful influence to the detriment of the American people to preclude such
a sensible plan from being enacted, just as it has managed to torpedo a
competition-fostering public option for health insurance. It has also worked assiduously to subvert any
really fair-minded reforms of our unfair healthcare system. Smart single-payer universal healthcare? Not a chance!
Since the rate of inflation in health
insurance premiums has far exceeded price increases in almost anything else, it
has contributed to the outrageous increase in profits at the largest publicly-traded
health insurance companies in the U.S.
The profits of these companies increased an estimated 428% from 2000 to
2007. The CEOs of these companies each
routinely make more than $10 million per year, and the bureaucratic red tape
for patients is absurdly costly.
The health insurance industry has prevented
reform of its practices for too long.
This has cost Americans hundreds of billions of dollars and contributed
to the deaths of tens of thousands of people every year who cannot afford
health insurance. The costs of
healthcare have increased so much that they now account for almost 18% of all
economic activity in the U.S. each year.
This system cries out for reform!
Unfortunately, our corporate-dominated system smart prevents reforms
from being enacted that would be in the best interests of the majority of
The 2010 “Lie of
the Year” award was given by PolitiFact
to the Republican refrain that the health care bill enacted by Congress (the
Affordable Care Act) was a “government takeover of health care.” PolitiFact
stated that “it is inaccurate to call the plan a government takeover because it
relies largely on the existing system of health coverage by employers.” Not only is the plan NOT a government
takeover of health care, but the new bill gives the profit-obsessed,
red-tape-propagating insurance companies a central continuing role in health
care by denying people the choice of a public insurance option. Power once again triumphs over common sense!
The 2009 PolitiFact
“Lie of the Year” concerned the ridiculous idea that there would be “death
panels in Obamacare”. It occurs to me
that if any entity wanted to form real
death panels, it would not be the government, which gives extra weight to the
needs of old people who vote and to health insurance companies whose investors
give generously to politicians. The
primary people really interested in denying critical care to people who cannot
afford it are those who are apologists for profiteering corporations and the
unlovely ilk of Republican politicians in Arizona, who are eager to externalize
costs onto people other than rich people or residents of Arizona.
Why is it that
people’s health has been the subject of more dishonesty than all other issues
in our nation? Read all about the billionaire
Koch brothers’ fierce self-serving opposition to healthcare reform in Common Sense vs. Political Realities: An
Anatomy of Dysfunctionality.
and thanks again to political operatives and the greedy Koch brother
billionaires, the “pants on fire” PolitiFact
Lie of the Year in 2014 was the evidence-denying assertion that
human-exacerbated climate change is a hoax.
Our children, and theirs, will see terrible consequences of this
treacherous denial of how human activities are altering biotic conditions on
The Truth about Big Lies
The fact-checking organization PolitiFact analyzes political claims to separate rhetoric from
truth. They do so to enlighten voters
and the general public. While both the
2009 and 2010 “Lie of the Year” concerned healthcare reform efforts, there are
far bigger deceptions than “death panels” and the “government takeover of
health care.” There
are even Bigger Lies that distort our worldviews.
“Big Lie” is a term first coined by Adolf Hitler in his 1925 autobiography Mein Kampf. This term was made famous by Josef Goebbels,
the propaganda minister for the German Third Reich. The idea was simple enough: if you tell a ‘big lie’ often enough, most
people will come to accept it, as if it were the truth. During World War II, the United States Office
of Strategic Services (the predecessor of the CIA), described how the Germans
used the Big Lie: “Their primary rules
were: never admit a fault or wrong
…; never leave room for alternatives
…; never accept blame; concentrate on one enemy at a time, and blame
him for everything that goes wrong;
people will believe a big lie sooner than a little one; and if you repeat it frequently enough people
will sooner or later believe it."
The following is a summary of the most significant
Big Lie deceptions in our world today.
Big Lie Number One. Economic goals and environmental protection
goals are not compatible. The truth of
the matter is that economic prosperity in the long run is entirely dependent on
healthy ecosystems and uncompromised ecosystem services.
Big Lie Number Two. It is a preposterous Big Lie to pretend that
either the delegates to the Constitutional Convention in 1789 or our
representatives who ratified the 14th Amendment in 1868 intended to give excessive
power to large corporations and rich people at the expense of the common
people. The five "conservatives" on the Supreme Court, in
chorus, may mouth the words, "Not true!”, but their corporate biases are
so transparent as to be laughable. Ha Ha! Unfortunately, it is not
at all funny that the corruption of our democratic republic by a small minority
of apologists for the rich and powerful has so inimically affected the
well-being of so many. We Americans do not just want to eat our cake and
have it, too; we want real positive change, and greater social justice,
and we want it NOW!
Big Lie Number Three. Some say that the “war on terror” is the most pernicious modern example
of the Big Lie phenomenon. The war on
terror has been sold as an undertaking designed to make us safer. Yet in truth this can be seen, in the larger
context, to be a gambit to gain a global hegemony that is not unlike that of
Adolf Hitler when he invaded a succession of countries. The so-called war on terror has created a more
dangerous world. Our national actions
since September 11, 2001 have been misguiding, and preemptive wars have been
illegal under the Nuremberg Principles and other international laws. The multi-trillion dollar cost of this broad
war, and the extensive casualties that have been incurred, far exceed the
actual threat of terrorism. And the
added debt associated with this rash, endless Orwellian war constitutes a
significant threat to global well-being.
Resources and money could have been used in much better ways to make the
world a fairer and more secure place.
Big Lie Number Four. The economic health and the well-being of our
country can best be achieved by reducing taxes on wealthy people so that
benefits will trickle down to everyone else, and by using our military forces
aggressively to protect U.S. business interests. The opposite, in actuality, is true.
Big Lie Number
Five. The Social Security program is an
entitlement program. In fact, it is NOT
an entitlement program. Social Security
is actually a retirement income insurance system that workers pay into
over their working lives. In treating
the program as a kind of entitlement plan, every person that pays this
insurance receives money back from current workers after they retire. This insurance plan should properly pay out
no more than is financed by payroll taxes.
And it should arguably be paid on a graduated basis to those who need it
during retirement, not to every person no matter how much money they have. A good proposal to provide a means of making
the Social Security system truly secure and indefinitely sustainable is made in
Radically Simple Ways to Make America
Fairer, and to Fix Both Social Security and Health Care So We Can Move On to
Address Much Bigger Issues.
“When in doubt, tell the truth.”
--- Mark Twain
It is disturbing that our political leaders
often resort so often to lies … or is it merely equivocation, tergiversation
Mitt Romney, campaigning
in 2002 for the office of Governor of Massachusetts, stated: “I’m not a partisan Republican. I’m someone who is moderate, and … my views
are progressive.” Was that the truth, or
Fast forward to February
2012. The same Mitt Romney, then campaigning
for the Republican nomination to run against President Obama, told right-wing
activists that he had been a “severely conservative” governor of
Massachusetts. People can actually
review his record and see that both of these characterizations are distortions
of the truth. What seems most clear is
that he has flip-flopped more than almost any other politician in American
history, like some rusty weathervane, creakily adjusting his positions to the
direction of the wind, but doing so with a dissembling, self-serving,
calculating, cluelessly unempathetic, hypocritical, contradictory, and
dishonest attitude that willingly undermines women’s rights and gives special
privileges to wealthy people in a rich-man’s cult-like ideology that seems
“Oh what a tangled web we weave
When first we practice to deceive.”
--- Sir Walter Scott
The honesty of his
character aside, Mitt Romney’s personal wealth is so large, and the rates of
tax he personally pays are so low, that he had definite conflicts of interest
when he advocated lower taxes on rich people.
This should have all but disqualified him from the position! How could we have trusted that he would have
served the country well? Why would we
have wanted to take that risk?
What, one might wonder, is the PolitiFact
Lie of the Year in 2015? The PolitiFact
people gave close consideration to this issue and found that "our
only real contenders were Donald Trump’s -- his various statements also led our
Readers’ Poll. But it was hard to single one out from the others.
So we have rolled them into one big trophy. To the candidate who says he’s all about
winning, PolitiFact designates the many campaign misstatements of Donald Trump
as our 2015 Lie of the Year.” Out of touch D.J. Trump’s ominous opposition to
climate action is a salient aspect of an unbelievable list of other
dishonesties that have made the tone deaf Trumpster the real deserving
recipient of PolitiFact Lie of the Year
So now the year 2016 is proving
to be a year of "lying decadently". All the Republican
candidates for the presidency have acted like con artists. Their biggest deceptions are the claims that
they will achieve the fiscal impossibility: to slash taxes and increase
defense spending and yet also miraculously balance the budget.
are not the only ones involved in wily deceptions. The airwaves are dominated by often rude and
argumentative talking heads like commentators on television’s Fox News and Rush
Limbaugh on talk radio. Mark Twain had
his own humorous perspectives on deceptions and obfuscation. He wrote in THE PUDD’NHEAD MAXIMS (Following the Equator, 1897): “The principal difference between a cat and a
lie is that the cat has only nine lives.”
look forward to watch a new documentary film titled The Brainwashing of My Dad, which explores the media scam involving
right-wing ideologues and Fox News. The
film tells the personal story of filmmaker Jen Senko, who
had watched her father, a veteran of World War II and Kennedy
Democrat, transform into a Fox News fanatic.
"Suddenly and inexplicably, her dad began to take issue against people
of color, homosexuals, women, minorities, Democrats and
the poor. Sound familiar? Millions have experienced
watching such a change in their friends and family."
film also contains perspectives from a plethora of people like Noam Chomsky and
Thom Hartmann, revealing how conservative media outlets have a
markedly negative effect on our country, and how it
originally started, and the inside “conservative” media tools they
use to influence and control the national discourse. Right-wing talk radio is known
to attract older Republicans who are angry and stubborn in their ways
and beliefs, but one might wonder what causes some Americans who have
not been particularly political, or who felt drawn to fair-minded
democratic sensibilities in their younger years, to become obsessed
with radical conservative talk shows and propaganda in their twilight
and the Nature of Shortsighted Expediencies
One pundit wrote
this: “Monetary policies are not and
cannot be aimed at such big issues as the distribution of income, economic
welfare, or social fairness.” Accepting
that it is true that the role of the Federal Reserve is not to address
unfairness in our society, the President and Congress and federal courts are
the entities that should assume this crucial responsibility. Unfortunately, the people in these positions
are too beholden to entrenched interests to significantly change our national
priorities and policies.
Golden Rule fairness
principles are at the heart of our democratic republic, and increasing extremes
of inequality are fundamentally contrary to these principles. There are good
arguments in favor of greater equality in our societies from the standpoint of
opportunities and economic fairness and legal justice. There are even better
arguments for a more fairly structured society from moral, religious and
spiritual points of view. A maximum
number of citizens should be given as much control over their lives as
possible, and be allowed as much say as is feasible over the direction their
lives will take.
This is a core
principle of our American democracy.
This principle is sadly being subverted by the nature of our current
economic and political institutions, which give big businesses and rich people
too much power, and ordinary people too little power.
often lead to political expediencies that are similar to people’s individual
propensities to pursue short-term-oriented courses of action. The most powerful pressure comes from large
corporations and rich people.
Corporations act in ways that are distinctly amoral because of the fact
that their two primary legal purposes are to make profits and to shield their
owners and executives from personal liabilities. Somehow we must find a way to
refocus our political initiatives on healthier long-term priorities.
to follow the easiest path are similar to people’s personal tendencies to
follow expedient courses of action.
People eat fast food, for instance, because it is quick and cheap and
easy, and it provides a burst of flavor and satisfies hunger. But fast food is filled with inordinately
large quantities of salt, saturated fat and sugar, so in the longer term it
causes weight gain and many other negative consequences, and fast food is thus
a kind of foolish expediency.
Likewise, it is easier
to let vested interests control our political system than to fight to change
our system of institutional bribery. It
is easier to allow Big Business to prosper at the expense of society and the
environment than to overcome the power of corporate money and dictate fairer
terms in all legislation. It is easier
to encourage profligate usages of natural resources than to conserve them. It is easier to maintain the status quo than
to change it to be fairer and greener.
It is easier to use credit cards and borrow money than to pay cash up
front, so millions of people run up large debts and incur exorbitant interest
expense costs. It is easier for the
government to borrow money to finance wars and social programs and operations
than to rigorously balance spending with income. It is easier for the Fed to slowly inflate
the American currency than to maintain a stable value for the dollar.
And it is also
sometimes expedient for a superpower to resort to the use of force than to
fairly and peacefully compete for limited supplies of resources. It is easier to launch wars with borrowed
money than to require people to pay today for such rash adventurism. War is the ultimate expression of unbridled
competition, and a good argument can be made that much of our international bluster
and domineering actions are a reflection of our weak national commitment to
honorable principles of Golden Rule fairness.
Wars are often launched with stalwart support from profit-seekers and
ambitious politicians in the thrall of avarice and ego.
It is easier to fight
wars with an “all volunteer’” army of paid soldiers than to impose a
requirement on every citizen to serve a mandatory tour of military duty. On the 40th anniversary of all-volunteer
American military forces, David Kennedy wrote in The Modern American Military:
“In the years between 1945 and 1973, when there was a military draft,
American forces were deployed overseas 19 times. Since 1973, when the all-volunteer military
came about, there have been 144 deployments.
The all-volunteer military has created a moral hazard.”
Our economic and
political systems themselves are to blame for these adverse developments. CEOs and managers who are responsible for the
financial debacle of recent years should pay the price for the ‘moral hazard’ of
having taken big risks to make enormous profits and bonuses. But our leaders bail them out using
taxpayers’ money and borrowed funds, and then once again allow them to make
outsized earnings. Banks are allowed to
become too big to fail, and then they are bailed out instead of being let go into
bankruptcy proceedings, despite the fact that such proceedings would be a more
sensible and fairer way to get all involved parties to agree to compromises
that would make these organizations leaner and more fit to survive.
Every economic system
is defined by rules. In a simple barter
economy, all participants are free to choose to make a trade or not, and to
agree to terms of exchange. The use of
coercion is not acceptable in such primitive economies. In a free market economy, likewise, the rules
of law are theoretically designed to stimulate commerce in the fairest
ways. But because the political
influence game is so tilted toward power-hungry insiders and rich people, those
who have the most money have the most influence to rig the system to give them
subsidies and unfair advantages.
Legislation that is enacted under these circumstances is generally
regressive in its impacts. This is
Recognizing that human
beings are motivated by impulses like envy, jealousy, avarice and pride, in addition
to more noble virtues, we should sensibly take these things into account in
redesigning our systems so that they are fairer and oriented toward the
longer-term best interests of all.
The history of
ideas is a vast and intriguing one. The
study of pivotal thoughts in the evolution of knowledge and perspective can be
classified into broad domains. There are
ideas about the physical world, ideas about human nature, ideas about
historical events, ideas about religions and philosophies, ideas in literature
and art, and ideas about economics and politics.
‘ideology’ was coined during the turmoil following the French Revolution by a
French writer named Comte Antoine Destutt de Tracy. It meant ‘the study
of ideas’. Comte Antoine was
passionate in particular about notions such as individual liberties, fair
societies, secular government, a free press, and freedom of thought and
expression. He held a high regard for
logic, rationality, reason, and realistic understandings. Bravo, Comte Antoine!
The meaning of the word ideology, however,
has shifted over the years to a narrower sense.
Ideologies are now specific sets of beliefs and values that form the
basis of an economic system or a political rationale or a religious orthodoxy.
Economic and political ideologies today are manipulative constructs that are
often advocated to justify self-serving advantages and political
partisanship. This is true of ideologies
that espouse laissez-faire capitalism, corporatism, trickle-down economics, and
even socialism, fascism, communism, nationalism and militarism.
Not long after primitive barter economies
evolved in the prehistory of humankind, trade no doubt became increasingly
complex. Some people chose to cooperate
fairly and peaceably in trade, and others chose to follow more aggressive
instincts and compete ruthlessly or use subterfuge or intimidation or coercion
or violence to obtain what they wanted.
The ruling classes of most nations use
their influence and the propaganda of their self-interested ideologies to
assert that the economic interests of the ruling class are identical to the
economic interests of the entire society.
This is absurd! It is about as
ridiculous as a similar assertion that claims the best interests of big corporate
entities are the same as the best interests of the majority of people. Often, they simply are not!
Mainstream economics has become a science
that is almost like a religion in its tenets of promoting growth and justifying
actions and policies that may be distinctly contrary to the greater good in the
long run. The misguided drive for growth
in consumption is an artifact of dominant materialistic economic ideologies of
modern times, which are becoming outdated as the need for more ecologically
intelligent initiatives increases.
Prosperity cannot much longer rely so exclusively on activities that
deplete resources and contribute to damages to the environment that supports
Ideologies are generally coherent systems
of ideas that rely upon a number of basic assumptions about reality. But these assumptions may not have any
definite basis in actual fact or evidence.
These assumptions serve as the kernel around which further assertions
grow, and they provide guidance for actions and behaviors and political
initiatives or obstructions. Ideologies
are often fraught with one-sided thinking and the denial of opposing
perspectives, and they often use emotionally manipulative kinds of spin to
promote specific ways that believers feel the world ought to be organized. And ideological arguments are generally used
to get people to go along with narrowly focused agendas.
“Reality --- What a concept!”
Ideology is not the same thing as
philosophy. Philosophy is an open-minded
branch of knowledge or academic study or speculative metaphysics that seeks to
understand basic concepts and truths.
Ideologies tend to be focused much less broadly. They can have positive features like passionate
conviction and vigorous energy, but they also can have negative aspects like
excessive and unwarranted certitude, stubborn rigidity, and misguided attitudes
of domineering righteousness.
Philosophy is not mere intellectualizing or
the propagation of an ideology. Ideas
can have important practical consequences, and it is vital that our ideas
become fairer and more inclusive and accurate.
When our American
democracy fought against communism during the Cold War, it brought leaders to
power who touted their anti-communist credentials and had little appreciation
or respect for the virtues of liberal democracy. Joseph McCarthy and Richard Nixon are two
prime examples. It is interesting that
right-wing fascism presented the biggest threat to world peace during World War
II, but then in the early years of the Cold War, the threat posed by ideology
came from the left extremes of the political spectrum in the form of
communism. Today, the biggest
ideological threats again come from the right, this time from free-market
fundamentalists, Tea Party politicians and religious extremists, as well as
unrealistic expectations of what military power can achieve.
Professor Alan Wolfe makes a good point in The Future of Liberalism, when he
is truest to its heritage when it rejects ideological thinking in favor of the idea
first step necessary in changing the world is to understand it, as it actually
Our Founding documents
were based on the liberal ideas of the 17th century English philosopher John
Locke and his philosophical follower, Thomas Jefferson, a principal author of
the Declaration of Independence. John
Locke insisted that government should be democratically based on the consent of
the governed. The core liberal principle
of democracy holds that we should strive to maximize the extent to which a
maximum number of people can exert control over their own lives.
is valuable to everyone, whatever their views, because it supports rights and
protections and rules of law that are enacted by representatives of the
governed. To scorn liberal ideas seems
to me to be incredibly perverse.
Liberalism, after all, seeks to include rather than to exclude, to
accept rather than to censor, to respect rather than to stigmatize, to welcome
rather than to reject, and to be generous and appreciative rather than stingy
Jesus was clearly a
liberal in preaching greater fairness to the downtrodden, and in his opposition
to the domineering emperors and high priests of the early society in which he
lived. It is thus ironic that religious
fundamentalists in the U.S. today join conservatives to oppose liberal ideas
and to harbor discriminatory biases against various groups of people.
support the dysfunctional status quo, or alternatively advocate reforms that
are regressive, repressive or unfair to the majority of Americans. Social conservatives, swayed by the spin and
manipulative propaganda of corporate interests and right-wing think tanks and
religious fundamentalists, have managed to cast deep suspicion on liberal
ideas. They have practically made
“liberal” a dirty word. Modern radical
conservatives sneer with seeming malice at liberals and liberal ideas and
progressive plans, and they attack liberals with shrill invective and
preposterous distortions like the disingenuous allegations of ‘death panels’
during the national healthcare debate in 2012.
The fact of the matter
is that the United States was founded on liberal ideas such as concepts of fair
dealings between citizens and representative democracy governed by a
constitution and rules of law, with rigorous constraints against tyranny and
authoritarianism. Because the U.S.
Constitution was based on Enlightenment Era ideas, it is laughably absurd to
see radical conservatives spinning it into strict-constructionist dogmas and
retrogressive ideologies and inegalitarian crusades.
“Out of the crooked timber of
humanity, no straight thing was ever made.”
--- Philosopher Immanuel Kant
Lerner has called for the revival of the American liberal movement. He provocatively says that it is nonsense to
think only of what seems politically realistic.
He points out that we should not restrict ourselves to “what is
realistic”, as defined by the media and our elected officials. “The most significant social changes have
happened because the civil rights movement, the anti-war movement, the Women's
movement, and the LGBT movement refused to be realistic in this sense. And precisely because they refused to be
realistic they succeeded in changing reality in dramatic ways. Or to put it in terms that should be on
everyone's banner: you cannot know what
is realistic in politics until you engage in a fierce struggle for your highest
ideals, because what looked unrealistic before you engage in that struggle can
suddenly become very realistic when others get the sense that it is safe for
them, too, to fight for their highest ideals.
So, to our politicians, we must insist: Don't be realistic -- be
principled, and even a little utopian -- because that is precisely what will
make major steps toward a more humane, just, peaceful and loving society
There is broad
truth in this observation.
Unfortunately, forces of reaction cling to their biases and grievances,
and when great advances are achieved, it can galvanize them into an extraordinary
bullheadedness, as demonstrated by the reaction of politicians in the South to
the freeing of the slaves during the Civil War, and then the passage of the
Civil Rights Act in 1965, and most recently the success of the gay
freedom-to-marry movement. How, one
should wonder, can positive change for the majority be achieved without
creating powerful and lasting reactionary opposition against it?
The Value of Big Picture Perspectives
Big picture perspectives can provide us with more accurate understandings. This is a good thing. Big picture understandings create more
clarity, a deeper sense of context, and a truer connection to values that are
more meaningful in our lives and work.
Accurate understandings can lead to better decision-making, wiser approaches,
more optimal practices, and outcomes that are more positive for all
concerned. That’s the theory of it,
Take football -- please! Football
is the king of sports in the U.S., and NFL teams are generally owned by
billionaires. So when referees for
professional football games were locked out of their jobs by NFL owners in
August 2012, no one seemed to care too much, even though one of the replacement
referees had actually been fired for incompetence by the Lingerie Football
League. Really, the Lingerie Football
League! Fired for incompetence! I’m not making this up.
In a Monday Night Football game between the Seattle Seahawks and the
Green Bay Packers, the replacement referees ignored a blatant foul and ruled
that, on the final play of the game, a Seahawks’ receiver actually caught a
Hail Mary pass, rather than a Packers defender having intercepted it. The ruling threw some $200 million in bets on
the game’s outcome from those who had gambled on the Packers to those who had
bet on the Seahawks. Jubilation, and
This ruling made many football-loving Americans cry out in rage. This put powerful pressure on NFL owners to
come to terms with the referees’ union, which represented the union’s 121
professional referee members. Many
people have been bamboozled into thinking unions deserve to be demonized, and
even that collective bargaining rights of workers should be eliminated. But after replacement “scab” referees had
made too many wrong calls, culminating in the travesty of the Seahawks/Packers
game, suddenly millions of people took notice, and wealthy team owners were
forced to negotiate in better faith and quickly agree to a fairer agreement to
end the three-week-long lockout.
“Truth is stranger than fiction, but it is because
Fiction is obliged to stick to possibilities;
--- Mark Twain
Here’s a big picture historical perspective. The Industrial Revolution began about the
same time as the 13 American colonies gained independence from Great
Britain. This technological, economic
and social revolution has fomented and galvanized the titanic struggle between
capitalists and workers. The Communist
Manifesto of 1848 itself had sprung into existence because of the striking
inequities involved in this strife between moneyed interests and working
people. The Gilded Age of the late 19th
century witnessed many colossal conflicts between ruthless business owners and
organizations of workers, and a surge of labor activism served to combat terrible
working conditions and the harsh policies of corporate conglomerates and
captains of industry and assorted robber barons of the times.
The need to deal more fairly with the many ills associated with
industrialization and urbanization was glaring.
So was the need to make our economic system fairer, and to improve
American society. Great progress was
made during the Progressive Era from the 1890s until the start of the first
World War. The important reforms that
were made included the breaking up of monopolies and giant corporate trusts
into less powerful organizations to ensure fairer competition. Valiant efforts were also made to reduce the
blatant political corruption that existed in those days. New laws were enacted
to create safer products and workplaces, as well as a shorter work week,
restrictions on child labor, collective bargaining rights, minimum wages,
modernized schools, saner fiscal policy, more sensible business regulations,
and a more secure banking system.
Numerous National Parks and urban parks were created, and significant
parts of national forests and other federal government owned lands were
protected. Conservation initiatives and
early protections of the environment were established. Initiative and referendum processes were authorized
to give citizens more power by allowing them to recall officials and introduce
proposed laws that would be fairer to the people.
This entire litany of hard-fought battles for expanded rights came into
existence through hard fought struggles by millions of workers and families
against ruthless business entities that have dominated this arena of strife for
so long. When the severe Depression came
along in the 1930s, the serious shortcomings of capitalism were starkly
highlighted anew, and wealthy people were forced to make concessions to make
society fairer. A New Deal was created
that ushered in an age of more broadly shared prosperity after World War II,
and gains in worker productivity were shared more fairly until 1980, when
Ronald Reagan brought his folksy revolution along to try to reverse this
The rest of the story has been redundantly told in places throughout the
Earth Manifesto. Suffice it to say here
that Dr. Tiffany B. Twain, like thousands of others before her, is throwing down the proverbial gauntlet, and wondering, “What
heroes will pick it up and run with it?”
It appears to me, my dear Mr.
Copperfield,” said Mrs. Micawber forcibly, “that what Mr. Micawber has to do,
is to throw down the gauntlet to society, and say, in effect, ‘Show me who will
take that up. Let the party immediately
step forward.’ ”
--- Charles Dickens, David Copperfield
An Aside on
Prohibition and Other Issues
movement activists early in the twentieth century were opposed to allowing
people to drink wine and beer and hard liquor.
For a variety of social and health and religious reasons, they were
against allowing people to enjoy alcoholic beverages. In January 1920, these activists succeeded in
getting the Eighteenth Amendment to the Constitution passed, making it illegal
to manufacture, transport and sell all forms of alcohol. This Prohibition assessed severe penalties
against people who made illegal ‘bootleg’ alcohol. As a result, organized crime became involved
in the sale of various forms of alcohol, and rampant corruption took place
among law enforcement agencies. The law
proved to be extremely costly and very unpopular, however, and it infringed
upon and ruined many people’s lives, so it was finally repealed in December
1933 with the ratification of the Twenty-First Amendment.
today generally support the federal government’s ‘war on drugs’, which is an
attempt to achieve a kind of modern-day Pyrrhic victory against people who use
marijuana and other drugs. The ideology
behind the drug war provides support for an intrusive government that prohibits
things like recreational and medical uses of marijuana. This impractically costly crusade against the
use of cannabis ironically seems to actually encourage the use of this drug,
judging from higher rates of use in the USA, where it has been harshly
prohibited since 1937, as compared to its use in the Netherlands, where it is
tolerated and practically legal.
“Marijuana is a gateway drug for cops. They can use
it to stop people they want to search."
--- Peter Hecht, Journalist
It is sensational
that this harsh prohibition has lasted so much longer than the laws against
alcohol. It took 75 years before
Colorado and Washington finally became the first two states to legalize this
useful drug in the November 2012 elections.
Ironically, says Michelle
Alexander, Associate Professor of Law, "After
40 years of impoverished black kids getting prison time for selling weed, white
men are planning on getting rich doing precisely the same thing."
Look at why the
prohibition against cannabis has lasted so long. John
Ehrlichman, a legal counsel to the former President Richard Nixon, made a
posthumous revelation that a central reason for the federal government’s
war against drugs in the 1960s was to repress leftists and blacks and
counterculture hippies. It reminded me
of a friend of mine who grew up in North Carolina and tells the story of police
trying to bust young unmarried people who lived together, which was against the
law at the time in North Carolina, and they did so as a ruse for a hidden agenda. This story just took on a deeper meaning.
infamous decades-long ‘War on Drugs’ was actually a tool for the federal
government to crack down on leftist protesters and black people, a former Nixon
White House adviser admitted in an interview ... We knew we couldn't make it
illegal to be either against the war or black, but by getting the public to
associate the hippies with marijuana and blacks with heroin, and then
criminalizing both heavily, we could disrupt those communities."
Ponder the fact that a
black market has been created for illegal drugs by this ill-begotten crusade
against marijuana and drug users. These
policies ensure that the supply of drugs is provided in a very undesirable and
dangerous manner. It also gives criminal
sectors of society additional wealth, influence and power, and ruins the lives
of millions of Americans by unnecessarily arresting them and forcing them to
endure costly legal travails and harsh incarceration. The insane escalation of public costs for the
entire infrastructure of prison-building, prison administration and prison
guards is absurd in the face of urgent needs for spending money on more common
sense priorities. There is an extremely
high cost to society in arresting more than 700,000 people every year for drug-related
offenses. It is damaging to individuals
and society to abandon the victims of these arrests to harsh fates. Such Draconian prohibition-like initiatives
are, from this perspective, rather dumb and quite counterproductive.
“The best way to tackle the problems of
alcoholism and drug abuse would be to take bold steps
to actually improve reality!”
The underground Mole
Many people are
accustomed to eating and drinking to excess in all kinds of celebrations and
parties and get-togethers, particularly from Thanksgiving through New Year’s
Day. Alcohol is consumed by millions of
Americans, and it is a social lubricant that is a distinctive feature of our
culture. Moderate consumption of wine,
beer or cocktails can be quite pleasurable.
But alcohol does create significant social problems, especially when it
is used in excess. More than 100,000
people die every year as a result of cirrhosis of the liver and other
afflictions associated with alcoholism.
Likewise, well over 100,000 people die each year of lung cancer caused
by smoking cigarettes.
contrast, is not known to cause any diseases.
It can be providentially used to mitigate the pain associated with a
variety of afflictions. Its use
sometimes enhances one’s pleasure and broadens one’s perspective, but it can
also cause a variety of personal and social problems. Those who overuse it with frequent use over
long periods of time can become a bit dopey.
But marijuana prohibition laws are a costly anachronism of public
policy. Marijuana use should be
decriminalized, and more sensible government policies should be
formulated. Sales of marijuana should be
taxed, and its production and use should be fairly regulated. The funds collected should be used to deal
with problems caused by the abuse of this drug.
Such an approach would be much more in accord with the common good than
the current Prohibition-like laws in most states.
Marijuana, n. Generically, a curiously intoxicating drug that
produces madness in total abstainers
intolerance in born-again refrainers.
--- Ambrose Bierce, The Devil’s Dictionary (paraphrased from
should reclassify marijuana from a Schedule I drug under a Federal Controlled
Substances Act of 1970 to a Schedule II drug, in recognition of the fact that
marijuana has accepted medical uses, as do other more powerful Schedule II
drugs like morphine and opium. By
improperly classifying cannabis, the law preposterously implies that marijuana
has a higher potential for abuse than much more addictive drugs. This erroneous classification has led to
absurd conflicts between federal and state drug laws. Marijuana’s Schedule I status breeds widespread
injustice and a lot of disrespect for government. It forces the Drug Enforcement Administration
to waste resources on such things as raiding the homes of people who have
health afflictions. It prevents testing
to see which maladies really benefit from the use of marijuana. The stigma of federal illegality deters some
people from seeking help from a drug that could help make them feel better and
suffer less pain. And, really, shouldn’t
law enforcement officers focus on protecting Americans from sociopaths and con
men and predators rather than spending so much time and money on victimless
crimes like marijuana use?
like Alcoholics Anonymous and various Rehab centers are much better suited to
addressing problems associated with addictive behaviors than police
forces. Let’s leave the province of
dealing with these problems to them, and cease using draconian punishments that
cause costly consequences by imprisoning so many people!
A British study
published online in November 2010 in the medical journal Lancet confirmed what
should be crystal clear: alcohol is far
more harmful to society as a whole than marijuana use. Researchers analyzed the
extent to which these substances are addictive and how they harm the human
body, as well as other criteria like the amount of environmental damage caused
by drugs and alcohol, and their role in breaking up families, and economic
costs like health care and remedial social services and extremely high rates of
tobacco and caffeine are substances that happen to be conducive to workaholic
behaviors or drowning the sorrows of workers, so society condones them, even in
spite of the fact that they cause widespread harm and can be quite
addictive. Marijuana, on the other hand,
seems to be prohibited partially because it is likely to make users less
mindlessly accepting of work routine and materialistic consumerism. These are hardly adequate reasons for the
harsh suppression of cannabis use! Huck
Finn would chuckle to himself as he did in The
Further Adventures of Huckleberry Finn, and declare that this viewpoint
“ought to give the bullfrogs something to croak about for days, I bet.”
made illegal in 1937 based on lies, distortions, and the influence of yellow
journalism. An ambitious bureaucrat
named Harry Anslinger was responsible for this criminal law. Today, even with medical marijuana movements
having passed partial legalization initiatives in more than 23 states and
Washington D.C., the federal government is still prosecuting marijuana
users. It is time to revise federal laws
related to marijuana use, and to reclassify it so that it is no longer a
Schedule I Controlled Substance that supposedly has a high potential for abuse
and “no currently accepted medical uses.”
The Marijuana Policy Tipping Point, psychiatrist Glenn Fichtner explores
the irrational politics that enshroud U.S. national policy toward cannabis
use. He asserts that this is a classic
case of “social or mass psychosis”. The
war on drugs has deep undertones of racism in its highly discriminatory impact
on black people and Latinos. “The war on
drugs just may be a bigger disaster than the war on terror,” says journalist
Robert Koehler in a column titled Public
Enemy No. 1.
Robert Koehler asserts that “reefer
madness” may be a case of sheer projection.
The true craziness is that of strict authoritarians who believe that it
is sensible to enact and enforce harsh prohibitions against those who use
marijuana. Some of these people claim
that smoking marijuana leads to mental derangement and violent behavior, so
they support federal policies that harass people, arrest them, treat them as
criminals, occasionally use shocking violence against offenders, and impose
ridiculously severe punishments even against people who use cannabis for
therapeutic and medical uses.
We can no longer afford the prison costs
and social harm caused by the devastating impacts on the lives of millions of
people due to current draconian drug laws.
Koehler notes: “To my mind, this
all smacks of the military-industrial metaphor that rules the American
roost. We’re quick to seize on something
as the enemy and organize blindly around its destruction, never stopping to
notice that what we’re really destroying is ourselves.”
Google “Watch High: The True Tale of American Marijuana” to see an educational
documentary film on YouTube that provides a fuller understanding of the history
of this modern day Prohibition-like war on cannabis. One can watch this film for free -- well,
subject to “limited commercial interruption”, including repeated ads for the
erectile dysfunction drug Viagra. What a
bizarre world we live in!
stunning perspective on the misbegotten "war on drugs" can
be seen on Netflix by watching The House I Live
In. This sobering documentary film tells many heart-wrenching
stories and shines a bright light on this unnecessarily harsh national policy and
its costly long-term impact on society.
The filmmaker, Eugene Jarecki, captures the stories of drug dealers,
police officers, prison inmates and others who have been negatively affected by
this crusade, which has cost $1 trillion in the last 40 years and resulted in
the arrest of more than 45 million people. The extent to which this wrong-headed crusade
disproportionately affects black people and those in lower socioeconomic
classes is made clear in the film, along with some of the odd injustices that
have come to characterize our civil justice system.
It would be an
excellent idea to legalize the use of marijuana for another compelling
reason. The legalization of marijuana
would shift cultivation of cannabis to agricultural cropland that is more
suitable to production than the public and private lands where it is secretly
and illegally grown today. After all,
there are many instances where illegal cultivation practices are causing
serious environmental damages, including forest clearing, stream diversions,
shoddy road construction, and excessive usages of fertilizers and herbicides in
places like the northern California counties of Mendocino, Humboldt and
Trinity. Legalization of marijuana would
be a positive step because then cultivation would be regulated and taxed, and
destructive practices would be reduced.
An Interim Conclusion of These
It is time that we begin to make more rational,
intelligent and honest public policy decisions that respect the greater good
and the broadest interests of humanity.
These decisions should take into account the various motivations and
propensities innate in human nature, and they should also give full
consideration to the best understandings of scientists, philosophers, spiritual
leaders and ecological economists. One
of our main national goals should be to redesign our economic and political
systems so that they are fairer to people now and in posterity.
We would be wise to always measure public policy
choices in the context of an awareness of the impact these actions will have on
people today as well as in the future -- to our children and theirs, and theirs,
and theirs, and theirs, and theirs, and theirs, not just to the fabled Seventh
Generation, but indefinitely!
Thanks for your consideration of
Tiffany B. Twain
Begun in 2012 or so, and updated modestly,
most recently in July and December 2015 and June 2016
An Aside to Book
I challenge book
club members to read and discuss Earth Manifesto ideas, and to provide me with
incisive feedback. I will make
modifications, Wikipedia-like, for important and convincing points of
I also encourage
readers to review Recommended Reading for
a Broader Understanding and Appreciation of the World in Part Five of the
Earth Manifesto online for great thought-provoking books that explore some of
the most compelling philosophical ideas in the history of the world.
Germinating Ideas for Inclusion in this
Here's some good
advice, and I will try to incorporate it into this manifesto more
assiduously: “Always frame policy
solutions in terms of what can be gained, not so
much in terms of what can be lost.”
Understanding the dramatic demographic
shifts taking place due to black and Hispanic women having more children than
white women is important. Steve Phillips, the author of "Brown is the New White: How the Demographic
Revolution Has Created a New American Majority", makes
some valuable observations about the implications of this development for the
future of the United States. After Antonin Scalia died, Phillips expressed this provocative understanding:
"The ferocity of the opposition on the
right wing to President Obama’s expected nominee (to replace Scalia) stems from
the very real understanding that this nomination represents a breaking of the
dam holding back the demographic and social change that has been surging into
society over the past 50 years. After centuries of racial and gender
exclusion, America has a lot of catching up to do. Since the creation of
the Supreme Court in 1789, America has had 112 justices, and 106 have been
white men. That’s exactly why President Obama should nominate a
progressive woman of color." (This
will now need to wait for Hillary Clinton or beyond.)
Court Justices and federal court judges almost all start as lawyers, and many
become distinguished, but they also tend to hew either to a conservative
constellation of beliefs or a progressive one.
How, then, are we to achieve an independent and fair-minded judiciary?
my fellow Americans. Let's demote
Republican politicians in the Senate and House of Representatives to being a
minority party again, and if they can become constructive instead of extremists
in obstruction, then they will earn the people's trust to be qualified to help
defended the U.S. aggression in Southeast Asia during the Vietnam War,
purporting to be patriotic when they disdainfully told peace activists to “Love
it or leave it.” But today they
increasingly appear to hate our American democracy. Their main impulse has become to demand that
they get their way, and they are increasingly belligerent in their
unwillingness to compromise. They refuse
to consider a replacement for Antonin Scalia on the Supreme Court, and they
want to build a huge wall to keep Mexicans out of the U.S., and they assert
that the nearly 12 million undocumented immigrants in the country should be
immediately deported, despite the calamitous impact this action would have on
the U.S. economy and the persons so rudely deported. They also display distinctly racist
antipathies to black people and Mexicans and Muslims, and they are antagonistic
to women’s reproductive rights and programs that help poor people. They seem to have an extreme lack of empathetic
understanding for others and a deficiency of regard for fair-mindedness. It would be reasonable reciprocation -- and
poetic justice -- for the American people today to say to these folks, “Love it
or leave it”. But unfortunately there
are not many places in the world that would consider accepting these immigrants
because of their hubris and unreasonableness and despotic opposition to
government, and they would make lousy candidates for citizenship anywhere else
because of their often hateful attitudes and their staunch opposition to the
reciprocity principles embodied in the Golden Rule.
rhetoric always blames immigrants for abusing government assistance programs
without funding them. The truth is quite
the opposite. A nationwide study
conducted by the Institute on Taxation and Economic Policy titled Undocumented Immigrants’ State and Local Tax
Contributions shows that more than 8 million of the 11.4 million
undocumented immigrants in the U.S. paid nearly $12 billion in state and local
taxes in 2012.
unauthorized immigrants worked and contributed as much as $13 billion in
payroll taxes to the OASDI program in 2010, only about $1 billion in benefit
payments during 2010 are attributable to unauthorized work. Thus, we estimate that earnings by
unauthorized immigrants result in a net positive effect on Social Security
financial status generally, and that this effect contributed roughly $12
billion to the cash flow of the program for 2010.
of which, Latinos are hardly the largest immigrant group entering the U.S.
today, despite what presidential candidates hanging out at the U.S./Mexico
border love to tell their constituents.
Research done by Eric Jensen of the Census Bureau shows that non-Hispanic
immigrants from Asia have made up the majority of immigrants entering the U.S.
since 2009. In fact, more migrants
arrived from China than from Mexico in 2013.
In that same year, foreign-born Asian immigrants, many from China,
Japan, Korea, and the Philippines, accounted for 40 percent of all immigrants
entering the country
the truth behind immigration and immigrants is more complex and ever changing
than many would have us believe.
Understanding these facts and shifts is key not only to challenging
reactionary anti-immigrant rhetoric but also to creating a real path to
properly reforming the immigration system.
these immigrants are also undocumented/unauthorized, they are unable to enroll
in government assistance programs such as Social Security, Medicare, and SNAP (Supplemental
Nutrition Assistance Program, formerly known as Food Stamps). There are exceptions for undocumented
immigrants with U.S.-born children who receive aid in their children's name. Overall though, undocumented immigrants
hardly make up a majority of federal aid recipients as is often falsely
example, data from the U.S. Department of Agriculture shows that, in 2013, the
majority of recipients of food stamps were white (40 percent).
African-Americans, who are typically racially stereotyped as recipients of
government aid accounted for just over 25 percent of all recipients. Meanwhile, Latinos who are typically
stereotyped as immigrants (undocumented or otherwise) accounted for only 10
percent of all recipients.