Archive for the ‘Government and public policies’ Category

A prominent businessman, Mort Zuckerman, recently said that Barack Obama’s administration was…”the most hostile administration to business…in decades.”  I’ve known this man for quite a few years as a serious and thoughtful person.  Why would he say something that is demonstrably false?  He must have been trying to ingratiate himself with others in the business community.  But, even so, it is a ridiculous statement.

After one of the most disastrous performances by the business community in decades, what did its members expect from the government?  A tap on the wrist?  A mild “don’t do it again” lecture?  Some kind of presidential “you’re doing a heckofa job” compliment?

Extemely highly paid executives on Wall Street, in major investment banks, in peak financial circles did stupid and vastly greedy things.  They did so under circumstances of relaxed government regulation.  They weren’t interested in their shareholders and certainly not the health of the national economy.  They were only interested in spectacularly bloated incomes and short term rewards.  Somewhere along the way, when they were picking up their MBAs at Harvard, Yale, or Columbia, no one told them what the role of the US government was.  Among many other things, under our Constitution it is to “regulate Commerce…among the several States.”

So accustomed to benign neglect under Reagan and the Bushes, suddenly these financial stars are confronted with a president who takes his oath of office seriously.  The laws of the United States state that business people are not to cheat consumers, short-change their shareholders, falsify their tax returns, mislead investors, and a host of other fair play rules that help keep the marketplace fair and honest.  The vast majority of business people, especially the small ones, are scrupulously honest.  They are not the problem.  But everytime the US government “deregulates”, that is relax its duties to protect the public, the high-rollers move in and take the rest of us to the cleaners.

What a travesty for someone who wishes to be taken seriously to say an administration is hostile to business when it is simply carrying out its statutory responsibilities to do its duty and protect the public interest.

Before bombing Iran, as many now seem to want to do, here are some questions that require answers and considerable public debate:

1.  Bombing a sovereign nation is a de facto declaration of war.  Our Constitution requires the Congress, not the President, to declare war.  Simply because we have launched a number of wars without a Congressional declaration does not mean the Constitutional requirement has been suspended;

2.  Such an attack will have economic consequences for us.  The Iranians most likely would blockade the Strait of Hormuz, thus reducing the shipment of Persian Gulf oil–almost one-quarter of our imports–and dramatically increasing world oil prices.  This would have a powerfully negative affect on our already fragile economy;

3.  Such an attack would place great stress on our military.  We cannot continue the Afghan war, prop up the neighboring Iraqi government, and create a third battlefield in the Middle East.  It is folly to assume that a US-Iran war can be carried out by the Navy and Air Force alone.  Our ground combat forces are near exhaustion;

4.  Bombing Iran would virtually assure an attack of considerable dimensions carried out against Israel.  This would involve both Iranian and Lebanon-based missiles.  Israel would necessarily retaliate.  We would then have all-out war in the Middle East.

5.  An attack on another Muslim (albeit Persian) nation invigorates al Qaeda recruitment.  A third war in a Islamic nation confirms their argument that the US hates Muslims.  Expect other 9/11’s of some dimensions.

This is the short list.  Many other questions must be answered, such as: will other Arab states in the Middle East, who we are told fear Iran, publicly endorse an American attack?  We shouldn’t hold our breath.

This is not an argument for “doing nothing”, the standard retort of the eager bombers.  We have at least a year, and probably more, to weigh Iran’s nuclear capabilities and intentions, and to rally regional and global opposition to them.  Building so-called “off ramps” for Iran on the nuclear highway is currently underway. 

In the meantime, before the dogs of war are unleashed, this debate better be brought out into the public squares of America.  The consequences are enormous.

It Is Still Possible

Author: Gary Hart

Congressional deadlock, created by lock-step partisanship and an unprecedentedly rigid opposition party, has been extensively analyzed, with no apparent resolution.  In the midst of wide-spread citizen economic misery, many Americans have simply concluded that this is the way things are…and apparently always will be.  In Kurt Vonnegut’s memorable phrase: “…and so it goes.”

But this isn’t the way it has to be.  There is a better way to govern and that better way characterizes much, if not most, of American history.  It certainly characterized the Senate of the 1970s when Democrats and Republicans found common ground, called the national interest, and held themselves accountable for achieving it.  This better time was brought to mind this week when I had a unique opportunity to remember those times.

Esquire magazine convened a commission of two Republicans, Jack Danforth (Missouri) and Bob Packwood (Oregon), and two Democrats, Bill Bradley (New Jersey) and this writer.  We were challenged to balance the federal budget by 2020.  Our moderator was Lawrence O’Donnell, former Senate staff director and now of Morning Joe.  The results of this experiment will be available in the December issue of Esquire, out by mid-November.  I urge you to read the results.

We achieved a balanced budget within a decade, but we also creatively addressed stabilization of Social Security, controlled health care costs, dealt with long-delayed military reform, and addressed energy conservation and climate challenges.  Cynics will say: “That’s easy if you don’t have to seek re-election.”  But why should statesmanship be considered cynically?  We were able to achieve our goals because each of us put the interests of our nation ahead of ideology and party.  That is the way government used to work.  I know from personal experience.  And there is nothing, save rabid ideologues and selfish interest groups, to prevent it from working that way now.

It is now commonplace, including on this site, to attack “the government”, as if it were some distant entity none of us is responsible for.  But a majority of Americans elect their president and their members of Congress.  If they don’t achieve what we demand of them, perhaps we ought to get our mirrors out and ask ourselves whether we all might share some blame.

Puzzling Questions

Author: Gary Hart

Among the many things I know little about, one big one is accounting.  But I do know there is a difference between expensing and amortizing a purchase or investment.  There is also the question of balancing assets against liabilities.

Now that the budget hawks have reappeared, it is instructive to consider both.  Take for example two big and venerable weapons systems: B-52 bombers and Nimitz class aircraft carriers.  Both have two things in common: they cost a lot of money; and they last a long time.  By comparison, the B-52s are much less expensive than their replacements, the B-1 and the B-2.  But in their day they were considered expensive.  And the CVNs (Nimitz class carriers), with a full complement of aircraft on board, are up around $10 billion or more.

From a budgeting standpoint, though, we “expense” both plane and ship, meaning we allocate their costs to the years in which they are or were being constructed.  Both, however, have service lives of over a half-century!  Those of you who know more than I about accounting, and that’s just about everyone, should tell me whether it wouldn’t make more sense to amortize their costs over their service lives.  This isn’t about a backdoor method of budget balancing.  It’s about common accounting practices.

Similarly, when looking at the nation’s books shouldn’t we balance our assets against our liabilities.  The national debt is now over $13 trillion.  On the other side of the ledger are $5 trillion in gold reserves and then trillions of dollars in federal lands, forests, minerals, wilderness, parks, and recreation areas, dams and water storage projects (almost all of these in the West), the value of our armed forces and defense equipment, federal buildings and facilities, and the list goes on.  We don’t know what all this is worth because no one knows how to conduct such a staggering appraisal.

But, the assets and liabilities balance is brought forward here not to escape the responsibility of wise stewardship of our national budgets and annual deficits.  That is one of the most important jobs of our elected national officials.  This issue, plus the idea of amortized accounting for long-term investments, is merely to try to put our national finances in a different, and hopefully more intelligent, context than they usually are when the deficit hawks start their periodic circling.

Paraphrasing Tolstoy: all happy empires are alike; every unhappy empire is unhappy in its own way.  Without entering the rhetorical jungle of whether the United States has been exhibiting imperial tendencies in the early 21st century, it does share some unhappy symptoms with previous empires.

It is always a cause for wonderment that those most eager to go to war spend so little time thinking about its long term consequences, especially in human lives.  This commentator has carried on a running word-fight with the media over the definition of “casualty”, usually used to indicate those killed in combat but intended to be used to include those wounded in combat as well.  Total U.S. casualties in Iraq, for example, are approaching 40,000.

But now the long term payback for that war, and Afghanistan, is coming due.  In recent days Defense Department studies reveal the number of suicides, drug abuse cases, and psychological disorders among the troops.  Much of this is the result of extended deployments and repeated re-deployments, as well as the destructive mental impact of close-order counterinsurgency warfare.  Dead bodies and wounded everywhere, everyday.  This human toll is exacerbated by the lowering of recruitment standards to include those previously categorized as “morally unqualified”, people whose backgrounds would not otherwise permit them to serve.  A separate consideration is the impact on career military personnel of being required to serve with those with criminal records.

Why cannot political leaders level with the American people on the costs of warfare?  It is obvious if they did so, the appetite for voluntary invasions especially would be greatly diminished.  Unfortunately our society’s collective memory will have erased the human costs of Iraq and Afghanistan by the time some future president starts beating the drums and unleashing the dogs of war.  Reawakening memory requires statesmanship and a knowledge of history.  And we have very few leaders who qualify.

Perhaps we should create a public office and call it the Prophet Jeremiah.  Everytime the war drums were heard, the Prophet Jeremiah would remind us of the human costs we were assuming and the unhappiness of empires throughout history.

Security Through Anticipation

Author: Gary Hart

As the world changes dramatically, so does the nature of conflict and methods for achieving security.  Even as nations increasingly find the costs of war unacceptable, stateless nations, such as al Qaeda, have found unconventional conflict attractive and insurgencies in Iraq and Afghanistan have shown the limitations of our Cold War large-scale force structures and weapons systems.

Chechyan separatists, Somali pirates, Mexican drug cartels, Pakistani Taliban, Turkish Kurds, Tibetan nationalists, and many others join al Qaeda (though not always as viciously) in representing the conflict of the new 21st century.

But they all have one thing in common: they are not afraid of nuclear aircraft carrier task groups, B-2 bomber wings, or big infantry divisions.  Despite our massive military superiority (at least in traditional terms), this fact–plus the rejection of stupendous reward offers–illustrates why Osama bin Laden is still alive almost a full decade after 9.11.

From these circumstances, certain conclusions may be drawn: the prospects of major nation-state wars is sharply declining; the prospects for unconventional conflicts are increasing; we are much better prepared for the former than we are the latter; invasion of other countries almost inevitably guarantees commitment to costly, long-term counterinsurgency warfare; and long-term reconfiguration of our force structures (and their strategies, tactics, and doctrines) is imperative.

And a lot more thought must be given to our real mission in countries such as Afghanistan and countries such as Iraq before unleashing the dogs of war.  That kind of great power intelligence, as well as a dramatic increase in our ability to anticipate threats and reduce them through a better understanding of history, culture, and local politics, will do more to make us secure than a new generation of massive Cold War weapons.

Welcome to the bright new century.

Fortune Favors the Brave

Author: Gary Hart

Many Americans are out of work. Many too many. Who’s fault is that? If you believe in so-called market economics, that’s just too damn bad. It’s the way things work. We shouldn’t mention that “things” in this case are decisions made by human beings, normally those with the money or who control the money, and those decisions are too often stupid. And by the way, others of this persuasion say or think, you can always find a job and if you don’t you are lazy.

Others, take Niccolo Machiavelli for example, thought Fortune to be a woman and a not very kind woman at that. Fortune favored some and disfavored others. Little you could do about it either way. We call it luck. Some are lucky. Some are not.

There is a third point of view. It says most people want to work. They are eager, if not desperate, to have a source of income, to feed and care for their families, to make their own way. Many of us in this group have known hard times. Either we ourselves or our parents or family have lost jobs, lost self-sufficiency, lost self-respect. It might help in political discussion if more people (everyone younger than me, and that is most people) had some memory of the Depression. Such memory would at least have the affect of shutting up those who casually say that the unemployed and poor are so by choice.

Beyond economic theory, however, is the deeper question: are we 300 million people who just happen to live in the same nation and are all on our own, or are we a national community, a place where we share common concerns, values, principles, and beliefs? The answer to this question will dictate your economics and your politics. It would be wonderful to believe that private charity alone, “a thousand points of light,” will take care of millions of desperate fellow Americans. But it can’t and it won’t.

Resources are available. A fraction of the money spent in Iraq and Afghanistan would put hundreds of thousands of Americans back to work rebuilding our nation’s infrastructure. If you can find money to fight a war, you can find money to create jobs.

The brave right now are those desperate neighbors who are struggling to hang on. If all of us, through our government, do not smile on them and help them, then we must pray that Fortune will.

Prioritizing Honesty

Author: Gary Hart

Suppose a family is in debt, as many American families are.  Suppose most of the family’s spending is necessary: mortgage payments, health insurance, gasoline, food, home repairs, and so forth.  Suppose the family sits down with pen and paper and works out that it will still be in debt even if all other spending, call it discretionary (as opposed to necessary), is eliminated.  Either something necessary must be cut or everyone has to get a second (or third) job.  Problem is, jobs are not available.

There is a lack of integrity in the national budgeting process.  Neither party will say specifically what it thinks should be cut to balance the national budget.  Some, particularly Democrats, will argue that public spending is necessary to prime the pump, to employ the unemployed so that they in turn can spend money and stimulate both economic expansion and revenues (taxes).

By and large Republicans like tax cuts for the wealthy, defense spending, international military expeditions, and hiring contractors, and they dislike human assistance, entitlements, and preservation of public resources.  By and large Democrats favor these things and dislike defense spending, tax cuts for those who can pay, and privitization of public responsibilities.  Neither party will be specific as to how the national budget should be balanced.  This is so because listing specific cuts alienates or angers particular constituencies.  Better to be vague.  And too many Americans want spending that benefits us but want cuts in what benefits someone else.

Current deficits are huge and, over time, unsustainable.  The deep recession and two wars account for much of it.  But, like our American family, much of our spending is necessary.  That includes Social Security and Medicare.  Some think Medicaid (health for the poor) should be dropped.  But what about the FBI, interstate highways, remediation of catastrophies (Katrina, Deepwater Horizon, etc.), intelligence collection, homeland security, federal research, veterans benefits, and the list goes on.  The vast majority of Americans say, yes, of course we need those.  Further, the notion of “privatization”, contracting out government responsibilites to private companies, is a smoke-screen.  It is still federal spending, with a profit added on top.

Members of Congress of both parties would be well advised to force their constituents to confront reality.  Bring pie charts and graphs of where the money goes to public meetings.  Force what’s left of the “responsible” media to report and editorialize on where the money goes.  Bring the public into the budget business and require responsible Americans to confront three realities: government spending and the size of government do not shrink with Republican administrations; the vast majority of government spending is required for the nation to function, let alone recapture greatness; and, historically, the great spikes in the national debt have occurred in wartime.

To have faith in this country is to have faith in its people, as Jefferson believed.  Given all the facts, and provided with political leadership in educating us as to the consequences of economic actions, the right decisions will ultimately be made.  But honesty, even brutal honesty, is required by both leaders and citizens.  Pie-in-the-sky schemes, inflated rhetoric, and bizarre economic theories must be rejected.  And we must all recognize that reducing huge deficits is one thing; balancing the budget in times of economic instability is quite another.

The Appeal of the Simplistic

Author: Gary Hart

Several days ago, in a critique of the Obama response to the Israeli attack on a Turkish ship, former national security advisor Richard Allen brought up the response of Ronald Reagan to the 1981 Israeli destruction of the Osirak nuclear reactor in Iraq.  Based on what Mr. Allen describes as Mr. Reagan’s “extensive preparation” and “deeply held principles on foreign policy,” Mr. Reagan’s response was: “Boys will be boys.”  Mr. Allen takes this as wisdom beyond the reach of experts and profound presidential analysis of a dramatic attack by one nation on another in the Middle East tinderbox.

It surely ranks, in terms of simplicity, with “Stuff happens” and “You’re doin’ a heck of a job, Brownie.”

In times when almost everything seems too complex, simplicity has its appeal.  Mr. Allen thought Mr. Reagan got right to the core, the essence, of Middle East, and possibly world, relations.  If he did, it is not obviously so and requires a discerning mind that few of us possess.

Perhaps more than any other, more sophisticated political analysis, however, this may isolate the gene that separates the conservative from the liberal mind.  It also accounts for the popularity in certain circles of a Sarah Palin.  Life’s not all that complicated.  It’s just a matter of common sense.  Eliminate taxes and government.  Refuse to address consequences.  Every person for himself or herself.  And devil take the hindmost.  Boys will be boys.

When Ronald Reagan says “boys will be boys” and Donald Rumsfeld says “stuff happens,” this is a whole political philosophy, a world view.  Life really is just one damn thing after another.  And society, all of us together, are wasting our time—and particularly our tax dollars—trying to make things better.  The liberal fallacy is to believe in improvement, progress, and a better way.  The fallacy is compounded when it requires serious thought, analysis, and an appreciation of history.

The facts of life are simple: investment bankers will be greedy; defense contractors will be corrupt; government officials are praised for just showing up; politicians will protect their careers; oil companies will cut corners.  The conservative mind understands basic human nature, and it is not a pretty sight.  Boys will be boys.

John Calvin constructed a theology around this notion.  Life is preordained.  You are either among the elect or the non-elect.  Life is predestined and predetermined.  Many conservative thinkers seem to operate from similar simplistic premises.  To be on the inside of conservative thought is to operate within a closed system and a simplistic one at that.  Very little changes, and nothing changes very much.  So only quixotic fools struggle for equality and justice.

Boys will be boys.  That is, until the consequences of their simplistic boyishness brings catastrophe down on all of us.  Then we may need some real leaders.

Weighing Risk, and Justice

Author: Gary Hart

In the second half of the 20th century major technologies, mostly having to do with energy production, emerged.  These included offshore oil drilling platforms, giant tanker transportation, and nuclear power plants.  Almost all energy production facilities, such as hydroelectric dams, tar sands, experimentation with oil shale, coal production, and so forth, also got much bigger.  Economies of scale was the usual justification.  If you are going to the trouble of drilling a mile or more down in the ocean or building a nuclear reactor, you got more bang for the buck by doing it on a grand scale.

Chernobyl and Three Mile Island, and now Deepwater Horizon, showed that with high production comes high risk.  High risk ventures such as these in the U.S. are licensed by the United States government.  Certain standards have to be met to obtain both a construction and an operating license for a nuclear power plant.  Presumably, some standards of safety and efficiency are also required for an offshore drilling permit.  British Petroleum had a five-story tall “fail-safe” apparatus on the ocean floor to prevent a well blow out.  It failed.

The U.S., and possibly all advanced nations in the world, require a public policy that authorizes high-risk ventures, ones whose failure produces catastrophe, only after very serious requirements are met: every system that might fail must be clearly identified; every system to respond to failure must be thoroughly tested and demonstrated; every technical and human response to failure and catastrophe must be drilled, tested, and proven; every operator must maintain highly-skilled emergency response teams at every facility around the clock; all levels of government emergency response must be integrated, drilled, and ready (including emergency evacuation of civilians); the costs of catastrophic failure must be included in the public record; a large emergency response fund must be maintained by the operator (that is to say, every operator must be self-insured); well-trained government monitors must be at every high-risk facility around the clock and have instant communications access to emergency response teams and senior government officials; and licenses to construct and operate these massive facilities must be signed by cabinet-level officials who personally assume responsibility in cases of catastrophic failure.

This final measure would certainly sober up those, including “drill, baby, drill” politicians, who might have their names on the line.  Right now we do not know what officials in the U.S. government finally authorized Deepwater Horizon, what safety measures its drilling permits required, what tests of the “fail-safe” apparatus were conducted, what plans, if any, BP and government agencies had for catastrophic response, and a host of other questions.

The alternative, of course, is to accept the risks of major failures, more Deepwater Horizons, as the way the world works.  Stuff happens.  Public memory is short.  Rare brown pelicans are expendable.  Gas in our tanks is not.  Gulf fishermen are on their own.  Besides, offshore drilling, massive coal extraction, and nuclear power plants create jobs.  Get rid of government, eliminate regulations, let free markets work, accept risk, forget catastrophies.  What are a few Deepwater Horizons in the great scheme of modern life.

The arc of the moral compass bends toward justice.