A low volume, high quality source from the demand side perspective.The podcast is produced weekly. A transcript is posted on the day of.

Sunday, November 19, 2006

The First One Hundred Hours - the Democratic Plan for America

Nearly two months ago, Nancy Pelosi and other House Democratic leaders introduced the "First 100 Hours" plan to clean up our nation's capitol and move our country forward. Here's another look at the plan and our take on it.

Day One: Put new rules in place to "break the link between lobbyists and legislation."

Day Two:
Enact all the recommendations made by the commission that investigated the terrorist attacks of Sept. 11, 2001.

Time remaining until 100 hours:
  • Raise the minimum wage to $7.25 an hour
  • Cut the interest rate on student loans in half.
  • Allow the government to negotiate directly with the pharmaceutical companies for lower drug prices for Medicare patients.
  • Broaden the types of stem cell research allowed with federal funds ("I hope with a veto-proof majority," she added in an Associated Press interview Thursday.)
By all means - put ending corruption at the top of the agenda. Lawmakers should be serving their constituents and furthering the greater public good, not working as a tool of corporations and special interests. And Democrats would do well to seize the initiative and take the lead in implementing common sense recommendations to make America safer.

The other policy goals will assist Americans in need, boost the economy, and help put an end to the Republican war on science. And lest you think all the action will be over after the first 100 hours, here's a note from Pelosi, written on Election Day:
In 100 hours, the top five oil companies will take in $4.3 billion in profits.
In 100 hours, $1.1 billion will be spent on the war in Iraq.
In 100 hours, the public debt will grow by $4.9 billion.
In 100 hours, the top 10 pharmaceutical companies will gain $2.6 billion in profits.
In 100 hours, the top CEOs will earn an average of $2 million each.
In 100 hours, a minimum wage worker working 8 hours a day will earn $171.67.

And if all goes as expected, in less than 100 hours my sixth grandchild will be born.

I want my grandchild to be born into an America where government is for and by the people. I want my grandchild to be born into an America that rewards and values hard work. I want my grandchild to be born into an America where you are not labeled a terrorist coddler when you honor the Constitution.

I want my grandchild to be born into an America where if the U.S. Central Command judges the situation in Iraq to be near chaos, with "violence at all-time high, spreading geographically", if the top intelligence agencies tell you that the war in Iraq is inspiring the very terrorism it was purported to prevent, and if four highly respected military newspapers say of the Secretary of Defense that "his strategy has failed, and his ability to lead is compromised...[he] must go" that you fire your Secretary of Defense and change the course.

I want my grandchild to be born into an America whose government honors its duty for accountability and oversight.

I want my grandchild to be born into an America that inspires innovation, that leads with dignity and diplomacy, that rejects fear mongering, and whose leaders start each day remembering that the Constitution begins with the simple but revolutionary phrase "We the people," which announced to the world that here, the people rule.

If you honor Democratic candidates with your vote today, in the first hundred hours of a Democratic Congress: We will restore civility, integrity, and fiscal responsibility to the House of Representatives. We will start by cleaning up Congress, breaking the link between lobbyists and legislation and commit to pay-as-you-go, no new deficit spending.

We will make our nation safer and we will begin by implementing the recommendations of the independent, bipartisan 9/11 Commission.

We will make our economy fairer, and we will begin by raising the minimum wage. We will not pass a pay raise for Congress until there is an increase in the minimum wage.

We will make health care more affordable for all Americans, and we will begin by fixing the Medicare prescription drug program, putting seniors first by negotiating lower drug prices. We will also promote stem cell research to offer real hope to the millions of American families who suffer from devastating diseases.

We will broaden college opportunity, and we will begin by cutting interest rates for student loans in half.

We will energize America by achieving energy independence, and we will begin by rolling back the multi-billion dollar subsidies for Big Oil.

We will guarantee a dignified retirement, and we will begin by fighting any attempt to privatize Social Security.

I say this as a grandmother (of almost six) and as the Democratic Leader of the U.S. House of Representatives.

The Democratic Congress can't even begin to tackle most of our nation's pressing problems in just 100 hours. But that doesn't mean they can't get started.

Saturday, November 18, 2006

Heavy debt puts the economy in trouble

The universal elements of financial crashes are:
  • Substantial and steady increases in the value of an asset -- tulips, stocks, property.
  • Leverage -- borrowing -- that is easy to get.
  • Nearly universal belief that a new form of wealth creation has been found that is immune from the limitations of past economics.
  • Disgust with and marginalization of any naysayers.
  • A precipitous retreat of values and panic dumping of assets.
  • Denial, after the fact, in the form of scapegoating individuals or a sector and minimizing personal culpability.
  • Astonishment and anger that lenders, as John Kenneth Galbraith put it, "should now in hard times, ask for payment of debts so foolishly granted and incurred."
  • Phenomenally short memories with regard to any lessons learned.
In the year 2000, interest rates as arranged by the Fed and its then chairman Alan Greenspan were at an all-time high. This was not an effort to rein in the dot.com bubble, but a reaction to invisible threats of inflation discerned by Maestro Magoo. [Reining in the stock market bubble should have been done by adjusting margin requirements, tightening rules on brokers, and jawboning to discourage blatant speculation. Never done.]

Inflation never showed up for Greenspan, but the economic slowdown did. And down came the interest rates, until eighteen short months later they were at their lowest point in history. Highest to lowest. The fact that the reduction was meted out in monthly quarter point drops makes it only cosmetically less drastic.

A few of us predicted the economic slowdown based on the fact that energy prices were spiking at the same time Greenspan was spiking interest rates. Others -- notably Dean Baker of the Center for Economic and Policy Research predicted the dot.com bust, but not the slowdown. Most, you may recall, had discovered the "New Economy" and "Dow 36,000," a new age of information technology unrestricted by the fundamentals of the past.

The effort of the Fed to restart the economy with low interest rates succeeded after a fashion, but not in the way that was hoped -- by restarting business investment. Instead, millions of Americans took advantage of the low rates to buy homes. With interest rates down, principle can go up while the payment remained the same.

Home values increased, partly based on demand, and partly based on the seemingly inexorable rise in the values. Where was a stock market shy investor going to make his big bucks now? Speculation moved from the stock market into real estate.
What now?
Now things have changed. Residential investment is plummeting. See EPI's chart.

The Financial Times reported yesterday:
The US homebuilding sector slowed dramatically last month as new home construction tumbled to a six-year low, according to figures released on Friday which contained troubling signs for the economy.
There was a clear indication of further weakness ahead for the construction industry as building permits for residential homes fell to the lowest level in nearly a decade after a drop last month of 6.3 per cent to 1.5m, while the number of permits issued in September was also lower than previously thought.

The fall in permits for new homes suggests the housing market has reached a critical point as builders abandon speculative residential developments to curb oversupply.
What does a housing crash look like?
In housing, a crash may have a different dynamic. "Panic dumping" is less feasible. Speculators may dump their property at the first downturn, but homeowners who live in their assets will tend to hold on, perhaps thinking they are whole, since they have to spend on shelter anyway.

But there are inescapable consequences. When prices go down, the equity in homes will go down, with four depressing consequences: (1) There will be no more equity to tap for current spending, which has been a significant source of spending for the past decade, (2) Mortgage payments that are much higher than (lower) home values warrant, making people feel poor, and hence hold back on spending, (3) The retirement piggy bank that people were counting on in the value of their homes recedes before them, creating the need for other types of savings, and (4) A continuing depressing influence on the housing market, as potential buyers delay purchases because in a few months they may pay less.

So as it plays out, the crash could be a long, slow depletion of economic vigor.
The problem of the debt
As we've shown elsewhere, there is no "growth," only borrowing, a shift of action from the future into the present.

Debt is a burden on our future, but seemingly necessary for our present. Should our overseas partners, the less wealthy countries that are subsidizing our purchases of homes and other goods, decide to reduce their lending, the pressure will become more intense.

Interest on the debt is going to begin taking its bite. No jobs are created when interest is paid. It would be one thing if the massive debt had created productive assets, infrastructure, or human capital. That is not the case.

Federal debt has been spent on a destructive war and nonsensical rewards to the rich. Private debt is in the largely passive and nonproductive asset of housing. [Note: The "Federal" bar in this chart shows only the so-called "unified" budget deficit. A segment should be added to each red bar in this chart to reflect the hudreds of billions of dollars per year in borrowing from Social Security and Medicare funds.]
When will it start?
Considering the "political business cycle," the fact that the Republicans pushed every spending choice and every positive indicator they could into the pre-election period, a return to reality happens right after the election. Housing weakness has been around for some time, but is now becoming serious.

As long as we can borrow, the day of reckoning can be pushed out. With weakness starting to show, however, our lenders may begin to lose confidence.

With Democrats in control, the chances that the Middle Class will get some attention is good, and this is fundamentally positive for the economy as a whole. Likewise, the serious attention by adults now in Congress to the debt will be significant. But the fundamentals and embedded debt are so heavily negative that it will take concerted and disciplined action to avoid serious loss to our standards of living.

For most of the country, it is likely to begin soon, by next spring. For the Puget Sound, with its trade-based economy that runs counter to the rest of the country, it will be delayed.

Thursday, November 16, 2006

The obvious post-election analysis - There is no room in the Republican party

I have been waiting for this point to be made by better political minds than mine. Floyd J. McKay came close yesterday in the Seattle Times, in a piece which concluded:
The 2006 election revealed Republicans are still in favor with white evangelical Christians, rural voters and the South — obviously, there is a huge overlap of these groups.

This is not a realistic base on which to construct a revival of the party whose leaders bragged a few years ago of a permanent Republican majority. Yet, having built loyalty among conservative Christians, the party cannot ignore them as it tries to moderate its appeal. Rove's strategy has turned on him and his party.
The point is, voters recognized that there is no room in the Republican Party for any but wingnuts, the ideologues of questionable competence.

This is a poser for Republicans. How do they broaden their base without "betraying" the Radical Right core group?

It is also the problem for the Democrats. How to accept all the factions, who deserve representation, without getting bogged down or trying to be all things to all people.

It is a problem for progressives. Some of the major problems the country and the world face do not lend themselves to compromise, or even gradualism.

The election was a week ago Tuesday. The best analysis -- the NYT and Robert Borosage of Campaign for America's Future -- was over by Thursday. Borosage said, among other things:
With this election, Republican dreams of consolidating a governing majority for a conservative era have run aground, shattered against the hard shoals of a reality that conservatives simply got wrong.

Before this election, Americans had already turned against the signature conservative initiatives of the Bush administration and the DeLay Congress . the pre-emptive war in Iraq, the trickledown economic agenda, the privatization of Social Security and the right-wing social agenda as reflected in Schiavo and stem cell research. In this election, Republican incumbents struggled to survive an angry electorate looking for a change.
Since Thursday, from what I've seen, it's been mostly the spinning of the narrative. It seems to be very important which version of the story is bought. I'm not clear why that is important. Every faction will have their own version, and they will all have to be re-spun after the next political event.

Perhaps mine is a narrative, too. If it is it's very simple:

Voters realized that there is no room in the Republican Party for anyone but the wingnuts and the corporate godfathers who manipulate them. The Dan Evans moderates do not have a home in this Republican Party. Voters also realized that a countervailing force is necessary, and they bought that the Democrats could be this force. Thus, no great splinter party action.

What that means for the GOP: They have to do a better job suppressing turnout. The Electorate no longer trusts them, which is a very bad thing for a party. It's going to be hard.

What that means for the Democrats: Old line party people who have been holding the fort will want leadership and power. People who represent new constituencies will want power. The entrenched corporate interests will begin to co-opt whoever they can.

What that means for Progressives: Progressives are just mainstream America who got there first. The Progressive agenda is founded on reality. Yes, it is inspired by principles and informed by logic and common sense, but its great strength is that it is a direct look at reality with a minimum of parochial slant.

It means that Progressives have to be very clear on who their political adversaries really are. The main political adversary of Progressives (and the planet) is the corporate aristocracy. This is also the true constituency of the Bush clan. I am not talking about business, or even the majority of corporations. Democrats have been good for business, because spreading prosperity around is good for business.

In this respect Progressives have a lot in common with some of the incoming Democrats who may be social conservatives or Blue Dogs, but who have populist agendas. "Populist" in this election has meant for anti-corporate.

Progressives need action. Democrats need action. The people who voted us in want action. Part of that action is getting people in there who can demonstrate competence and integrity, much of which will have to wait until the Executive changes in two years.

Integrity and forward motion are fundamental to a continued majority.

The "First 100 hours" package is a start. The end to American presence in Iraq is next -- with the McGovern mileposts included. Health Care could be next. Very soon we have to engage the issues of environmental degradation of with an effort of the scale and commitment of a war.

Get something done and there will be enough influence for everybody in the Democratic Party. Not getting something done means all positions and power will be illusory.

Monday, November 13, 2006

Progressive members of Congress should support John Murtha

A year ago, John Murtha was marginalized by the press and became the object of the White House attack machine under Karl Rove. He gave as good as he got, stood up to Bush, Cheney, Rumsfeld and a Congress dominated by Republicans, and let the chips fall where they might.

He was supported by Nancy Pelosi.
"We should follow the lead of Congressman John Murtha, who has put forth a plan to make America safer, to make our military stronger, and to make Iraq more stable. That is what the American people and our troops deserve."
It would be an immense symbolic step forward if, one year later, it is Murtha who emerges with power. Right now, the media is cooling its heels waiting for the Baker Commission to put forward its plan. That is staging. If the House Democrats elect Murtha as Majority Leader, they take back the stage.

This face, this ex-Marine, this patriot can be the leader that gets results soon on Iraq. The Democrats behind Murtha, with his stand-up courage and his credibility within the military, can dictate the terms of withdrawal. Democrats can take control of the timetable.

We cannot wait to see what hell evolves in Baghdad. The McGovern answer is the right answer. Can it be delivered? Murtha favors a redeployment option that is possibly the politically practical answer. The two can work together.

Progressives do not need to approve of Murtha's politics or answers across the board. But he has proven himself to be a leader and to have Pelosi's trust. These are difficult times.

We have been in similar situations before. Take Christine Gregoire She has earned progressives' support not so much because she's a progressive visionary, but she is a unwavering leader in a time when we need that kind of leadership.

Below is the press release from Nancy Pelosi, from which the quote at the top is taken.
CONTACT: Brendan Daly/Jennifer Crider

Pelosi: ‘The President Has Dug Us into a Deep Hole in Iraq; It Is Time for Him to Stop Digging’ Washington, D.C. – House Democratic Leader Nancy Pelosi held a news conference today in response to President Bush’s speech on Iraq. Her remarks are below:

"What we heard today was a commitment to the status quo – a status quo that is not working.

"The ‘Plan for Victory’ backdrop against which the President appeared at the Naval Academy today was no more accurate than the ‘Mission Accomplished’ backdrop he used over two and a half years ago on the USS Abraham Lincoln.

"The President did not have a plan for victory when he went into his war of choice in Iraq, and he did not have a plan for victory today.

"The American people expected that the President would do more today than just put a new cover and 35 pages of rhetoric on old sound bites. What the American people wanted from the President today was some evidence that he has heard their concerns.

"Clearly, the President fails to understand that a new course is needed in Iraq. The President has dug us into a deep hole in Iraq; it is time for him to stop digging.

"He offered a status quo plan that would not accelerate the training of Iraqi security forces, would not motivate Iraqis to assume security responsibilities more quickly and bring American troops home.

"Instead, he suggested that we send more troops and spend more money in Iraq. That is not what the American people want.

"The President says that the security situation in Iraq is getting better. But just because the President says it, does not make it so.

"226 American soldiers have been killed in Iraq in just the last three months. The Generals have told us that the presence of large numbers of U.S. forces in Iraq encourages the insurgents. The President provided no specifics on how, or when, the number of troops will be reduced.

With more than 2,100 American soldiers killed, thousands more wounded grievously, and hundreds of billions of dollars spent, the President owes the American people more than he provided today.

"We should follow the lead of Congressman John Murtha, who has put forth a plan to make America safer, to make our military stronger, and to make Iraq more stable. That is what the American people and our troops deserve."
The same situation exists today.

Murtha's record isn't spotless. As some commenters have noted, he's been tangled up in the ABSCAM mess. And in the past he has seemed more interested in doling out federal grants for pet projects than fiscal responsibility. Nobody's perfect.

But if we want to "clean House", Steny Hoyer is not the man for the job. He's too tied to corporate interests. As David Sirota has noted:
You remember, it was Hoyer - the Democratic Whip - who refused to whip votes together to try to defeat the corporate-written Central American Free Trade Agreement. When Pelosi tried to build opposition to the disgusting bankruptcy bill, it was Hoyer, the second-ranking Democrat in the House, who not only didn't whip against the bankruptcy bill, but actually voted for it, after pocketing massive campaign contributions from the banking industry.

And when Pelosi worked to keep her caucus together in opposing the GOP Energy Bill, it was Hoyer who voted for the nauseating legislation after pocketing more than $300,000 from energy/natural resource industry cash. That legislation that literally gave away billions of taxpayer dollars to the energy industry profiteers who proceeded to bilk Americans with higher and higher gas prices.
Murtha is more likely to have a fruitful working relationship with Speaker Pelosi and listen to voices in the progressive movement than Hoyer is. Hoyer has a history of undermining the Democratic caucus and creating division rather than unity.

He didn't fight the bankruptcy bill. Or the energy bill. He has criticized his fellow Democrats' support of a timely Iraq withdrawal. On too many important issues, Steny Hoyer has the wrong positions. We feel that Murtha would be a better leader in the House Democratic caucus, and we'd like to see him get the chance to prove himself.

Sunday, November 12, 2006

This lame duck may fly

Most observers predict a desultory period between now and the new year, with the current Republican Congress content to wrap up the mess in a plastic bag and leave it on the doorstep of Nancy Pelosi and Harry Reid.

Specifically, the talk is that unfinished spending bills will be dumped into a continuing resolution and later an omnibus bill, so as to give plenty of time for unemployed Congressmen to construct their resumes and start knocking on the doors of K street.

Does the GOP want to leave a bitter taste in the mouths of the electorate? Isn't their only future to take the Dems up on the offers of bipartisanship?

What with new rules for lobbying on the horizon and the loss of both houses, K street already has a big surplus of right wing ideologues. The only Republicans with influence will be those who can work with Democrats.

Voters and Democrats have already gotten more action on Iraq, with the firing of Rumsfeld and the nomination of a pragmatist, in the few days since the election than they did in the entire year previously. They may get similar movement elsewhere in the agenda.

A few predictions:
  • Republicans will write the appropriations bills and pass them in good order. The leadership will want to leave a sense of competence in the minds of the electorate. They will come back after Thanksgiving to get it done if they have to.
  • Middle class tax cuts will be passed. The so-called "extenders," the deductions for state sales taxes and for student tuitions, along with the R&D tax break will be passed. The GOP used their power to extend the tax breaks for the rich last spring -- into 2010. Will they really leave town without extending the rational tax breaks for the middle class into next year? [You'll remember Senator Cantwell took a courageous stand against cutting the minimum wage for tipped workers and announced it on the Official Blog. That bill also had the extenders in it as well as the evisceration of the estate tax. The voters and Senate Democrats look pretty good today for having stood up then.]
  • Confirmation of Gates. The Pentagon won't have to wait until January to expel Rumsfeld. Gates will be confirmed in December, though Senators will make sure they're not buying the Baker commission's prescription in the blind. (Gates was a member of the Iraq Study Group headed by James Baker and Lee Hamilton. That group has a report coming in January. A better one is already on the table from George McGovern and William Polk. See our treatment.)
  • Rejection of Bolton. John Bolton will have to kick his dog and terrorize his office staff somewhere other than the UN. Confirming him may be Dubya's priority, but I see a swirling pattern and a flushing sound in Bolton's future.
That will be a bunch. Particularly the budget work. Only two of, I think, thirteen spending bills have been passed. A $5.2 billion transfer from domestic programs to the military is not accounted for, which means an untoward changing of the rules or even deeper cuts in domestic programs.

The voters and the Democrats can be very satisfied if it gets done. If it doesn't, the Republicans need to explain why -- on camera.

Friday, November 10, 2006

The pragmatist's view of impeachment

In the aftermath of the Democratic victory on Tuesday, talk radio -- progressive talk radio, anyway -- has been dominated by cries for impeachment.

It was taken "off the table" by Nancy Pelosi and Harry Reid and the Democratic leadership. This is an outrage to patriots and other ardent fans of the U.S. Constitution and the rule of law.

As a pragmatist, I support fellow activists in their determination to see justice done and principle dominate. As a pragmatist, I also support the Democratic leadership in taking impeachment "off the table." Yes, I can have it both ways. Let me offer an explanation.
  1. Removing Bush from office leaves Dick Cheney in charge. (Feel that chill?)

  2. Impeaching the two together would be like Nuremburg goes to Hollywood.

  3. Not taking it off the table in DC means that's all any of the press will want to talk about. Taking it off the table means if the press wants to talk about it, they will have to talk to activists and outraged citizens.

  4. Placing the Democratic leadership between Bush and the lynch mob will stimulate a certain amount of attention by Dubya to the Dem's agenda.

  5. Action on the Democratic agenda means an end to Republican relevance. The public will see who gets things done, who protects them, who listens to them, and who they can trust.

  6. Problems of climate change, health care, world poverty, social security, debt, and the economy need the Democrats' attention to solve.

  7. Corruption is pervasive. Focusing on impeaching Bush gives the Republicans the king of scapegoats. With Bush off the table, we could start with Cheney, Halliburton, the House (including the highly culpable Doc Hastings), and the rest. Look at what happened to the GOP when they tried to impeach Bill Clinton. Even if Dubya deserves impeachment, that doesn't mean it's what we should pursue. We want to be about wise governance, not getting even.

  8. Off what table? The case for impeachment dot org could be the next great web site. As the crimes and misdemeanors come out in official testimony -- and God help the first man to plead the Fifth -- the groundswell will grow. Determined people and the enough revelations will find a table. If the groundswell grows, it grows.

  9. If the case is forced night after night, either by the activists or in hearings or public debates of another type, the public will get to see Pelosi, Dubya and the Shooter juxtaposed. And that's a good thing.
This organization has confidence that Nancy Pelosi and Harry Reid can trailblaze a successful path to a stronger America and a stronger legislative branch. They can ensure that we will in a good position to make the case to the American people that the Democratic majority should be expanded in 2008.

Thursday, November 9, 2006

Three messages from the voters the Dems need to deliver

Tuesday can be an object lesson in democracy, for ourselves and for the world, but only if the messages sent by the electorate are delivered.

If there is anything like "business as usual," the frustration and cynicism factor will poison our Republic. This election will have meant no more than the Iraqi election staged by Bush & Co.

Three messages that need to be delivered:
  • The war was a mistake and it is being run stupidly
  • The kitchen economy is in the red and going the wrong way
  • The culture of corruption needs to be wiped out completely
In reverse order:

Throw the Bums Out
. That is what the voters did themselves, to a large extent. But their targets were not just the Conrad Burns of the Congress, but the "culture of corruption" that every Republican bears a responsibility for.

Voters want to see housecleaning completed with an exclamation point. Pelosi's "most honest and open Congress in history" is code for doing that. Fumigating the place.

But it has to go right into the corporate fraud and profiteering in Iraq and into the corporate fingers in the Medicare bill and Energy plan and every other piece of legislation. The lobbying firms on K street now are overloaded with ex-Republican legislators. Let them find honest work. "Witch hunt" is going to be used a lot. I still like "fumigating the place."

Strategically it is very important for Democrats to do this right. This is the opportunity to prove themselves to be the honest stewards of the public's business, and the chance to show, in the conservative metaphor, that the Republican Daddy is an unreliable drunk and cheat.

The Economy
. The most pathetic thing about Dubya's news conference the day after the election was his befuddlement around the economy. "The economy is strong," he said, and shrugged his shoulders in bewilderment that voters turned out in droves against the party in power.

This guy just doesn't get it. He is completely out of touch with Americans on Main Street. I personally am infuriated by the top-heavy debt-loaded economy in which the Middle Class is the beast of burden.

But it was a different, less abstract anger about the economy that came to the voting booth. It was the Middle Class using the credit card to buy groceries and the working class choosing between health care and rent.

Income has stalled. The price of necessities like health care and energy and housing are going up. Corporations and the rich are grinning. That's why Bush doesn't get it. He can't see Middle America looking at the stack of bills on the kitchen table and wondering what happens if they get old or sick.

The War
. When you run halfway around the world, invade a country rich with oil, and drag in a spurious national defense angle for justification, you have a built-in PR problem. When the war blows up in your face -- or in the face of your constituents' children -- you have a bigger problem.

The only thing that could have saved the Republicans would have been another 9-11. That would have meant they'd failed to protect us, but it would have raised the fear level high enough to hide this disaster in Iraq for another couple of months.

There simply has to be a change. Politically Democrats do not need to come up with the plan. They can let the president twist in the wind.

Every way out of this mess is ugly, so whatever is decided needs to have everybody's fingerprints on it. Morally, Democrats do need to push the pace and make sure competence is rewarded. And as above, the fraud and waste and war profiteering needs to be exposed and stopped. (Rebuilding the country is a good place to start returning Iraq to the Iraqis.)

If these clear pronouncements from the voting booth are acted on, Democrats can be the majority party for a long time. It will mean "your vote counts when you vote Democrat." It is just for that reason that Republicans will do everything they can to stop the messenger.

The current show of bipartisanship is going to be a one-way street.

It is up to us to make sure it happens, with support and -- if necessary -- criticism.

Tuesday, November 7, 2006

Three E's for framing - Economics, Ethics, Environment

The day after the election will come -- hopefully with good news. But whatever the news this year, the different direction the country needs to find leads right into progressives' strengths. We can only communicate effectively, both factually and in terms of underlying principles. Some thoughts.


The kitchen economy: The economy is just as important to people as Iraq, polls have shown, and people trust the Democrats. Rather than play with the Republicans' sound bites, we need to remove ourselves from the spreadsheets and graphs, sit down with the folks at the kitchen table and go over their bills with them.

We can look at the doctor bill, the insurance bill, the gas card bill, the heating bill, the college tuition bill, and yes, the tax bill. But we should itemize the tax bill for social security, schools, roads, police, national defense and the rest. And we should itemize the other bills for corporate profits in health care and energy and environmental degradation.

Then we can put the paycheck on the table. We can say a lot about the paycheck.

This kitchen economy is what the "first 100 hours" package of the Democrats is aimed at. God willing, we will see that passed early on. But we need to stay at that kitchen table until we fix health care. It is a matter of a family's security -- financial and physical. Shifting the deductions and insurance charges and doctor's charges from one bill to another is not so difficult. If we can make the point that we save by shifting from for-profit, complex, inefficient health care to single-payer coverage for all, we will have the game won.


This is the appropriate lens for the Iraq War. Progressives do not need to get bogged down in what the best way out is. First of all, there is no good way out. Second of all, we should be trusting our military and diplomatic professionals.

Our issue in Iraq should be ethics, the lies that got us in, the hypocrisy of Bush's "democracy" when the real purposes were domination and oil, the cronyism and incompetence at the top, the corporate fraud and waste and profiteering. And be sure to measure the cost in lives as well as dollars.

Congress is another hotbed of corruption, but Bush and Cheney are the poster boys for the subversion of the political process. Rumsfeld for incompetence. (I can't wait for the hearings)

The principle of the protective parent is at play here, but the issue of ethics targets the hierarchical principle of conservatives. These can't be the strong father they pretend to be if they're betraying the family like this.


Nothing plays better into the progressives' strengths than taking care of the environment. Competence, stewardship and prudence. It is important from a strategic point of view to get going on the environment, not only because we are so far behind already, but because it is the issue that is going to dominate the century. Democratic credibility will pay off big down the road. Republican obstructionism will hurt them bad.

Now let's see what the voter's say.

Monday, November 6, 2006

Republicans dump Iraq auditors

Incredibly, the already shoddy oversight of American spending in Iraq has been gutted by the GOP leadership. It happened in conference committee when the Office of the Special Inspector General for Iraq Reconstruction was surriptitiously terminated.

The New York Times reports that
"Tucked away in a huge military authorization bill that President Bush signed two weeks ago is what some of [Inspector General Stuart] Bowen’s supporters believe is his reward for repeatedly embarrassing the administration: a pink slip...."
"The provision was inserted by the Republican side of the House Armed Services Committee over the objections of their Democratic counterparts during a closed-door conference on the bill."
The NYT article by James Glanz appeared Friday, and has not seen the light of local media. Mirroring it was an article in the Washington Post which noted that although the Pentagon has spent about $250 billion in Iraq, "the Defense Department's inspector general's office has only two investigators and a half-dozen auditors working there. As recently as last year, it had none."

In other words, the Office of the Special Inspector General was the only significant oversight in town. Now it's gone.

Need any more proof of the connection between corporate corruption and the Republican power structure?

Thirteen out of fourteen projects by one contractor, Parsons Corp, had significant problems. One contract was to build 142 health clinics. "Only six have opened. Yet Parsons will not have to return any of its profit, nor is it likely to face any kind of formal punishment."

Here and elsewhere, contractors fall into a legal Twilight Zone where they can rip us off and place soldiers and civilians at risk with little fear of retribution. The Post reports that a 2000 law that was intended to hold contractors responsible for crimes in war zones "has never been tested." Several civil cases, including one where Halliburton truck drivers charged that the company knowingly sent them into a raging battle, have been thrown out because, as the judge ruled, the Army, not Halliburton, is ultimately in charge in wartime.


Sunday, November 5, 2006

Bushit on the economy continues

Look who's misleading the public again:
“Americans are finding jobs and they’re taking home more pay,” Bush said. “The main reason for our growing economy is that we cut taxes and left more money in the hands of families and workers and small business owners.”

--George W. Bush, (last Friday)
That's not the economy here on the ground, Dub.

First, there's the taxes you don't admit.
  • The health care tax -- premiums have doubled for employers and employees over the past five years.
  • The corporate gas price tax -- gas prices went through the roof, generating hundreds of billions of dollars in profits for Big Oil.
  • The deficit tax -- Every dollar borrowed by the Bush regime must be repaid. Yes. Taxes are down this year, on the rich, but the debt is exploding, but every dime has to be repaid, with interest -- with taxes. Maybe that's you. Maybe that's your children. But it's SOMEBODY'S taxes.
Then there's the fact that more money is not in the hands of "families and workers and small business owners."
The tax cuts for the high rollers have very little to do with the economy's activity. What action there is comes from federal spending increases and the big time debt in the residential housing balloon. Wait till after the election.

Saturday, November 4, 2006

Doc Hastings' ethics fail again

Bob Ney finally resigned, but not because of House "Ethics" Committee Chairman Doc Hastings. Doc has done everything he can to keep all the corruption -- and there's been a bunch -- under wraps, even while he gladhands the folks back home in Washington's 4th District. Four senior Republicans have resigned in the past two years amid scandal. Doc sees no evil.

Ney long ago pled guilty to corruption charges, but retained his House position until yesterday. As House Minority Leader Nancy Pelosi said,
"The Republican leadership has allowed Bob Ney to receive his paycheck and benefits for seven weeks after his admission of guilt to criminal conspiracy charges -- it is an embarrassment to this institution and an insult to the American taxpayer. House Republican leaders have a long pattern of covering up and protecting Republican Members, and their culture of corruption comes at great cost to the American people."
No telling what else is going to come out after the election. If Hastings retains his House seat, it will be a crime in itself. Nobody has done more to nurture the culture of corruption than Doc.

Friday, November 3, 2006

No 1% Solution for Climate Change

A brilliant article by Julia Whitty in the latest Mother Jones sets it up for us vis-a-vis the global disasters being hatched by human-caused climate change. We need to realize these aren't happening somewhere else, they are in our neighborhood, in our back yard, and staying indoors is not an effective answer.

The twelve tipping points -- from the deforestation of the Amazon, which will turn that region from a huge CO2 consumer to a net CO2 producer, to the melting of the Greenland Ice Sheet and the consequent 23 foot rise in sea level -- are cogently described. But what is brilliant is not these narrative clips. What is brilliant is the weaving in of the 13th tipping point, "the shift in human perception from personal denial to personal responsibility."

The author's dispassionate scientific eye lays out our near certain doom -- in this neighborhood -- should things not turn around. The same dispassionate eye deals with the scientific literature on the possibilities for salvation -- the potential for altruism, the dynamics of a society with cohorts of naysayers and of alarmists bracketing a range of other world views, the survival value of democracy, and more.

Her brief is fascinating and calming in a way for its vision -- vision both in terms of the view of the world and in terms of the process of seeing and that organ of insight which sees.

Whitty's piece gives a necessary balance to another piece out recently, the 700-page report by Sir Nicholas Stern, former chief economist of the World Bank, which concluded that a prudent approach to climate change which began immediately might cost only 1% of GDP and would avoid a price tag of up to 20% of GDP should we delay.

With all due respect to my fellow economist, and admitting I have not read anything other than the London Times account of the Stern Report, I object strenuously to the idea that we can manage the risk of continued environmental degradation with any certainty. We are not going to be able to send a check to the global warming account and drop it in the mail on our way to the Mall.

If one environmental system breaks, others will fall like dominoes, or like interrelated systems. It will do no good to live 30 feet above sea level, or far from a frozen Europe, or be able to afford some mitigating device. Part of the needed and eminently possible shift in perception is the fixing of a certainty that climate change is coming to our town.

Many of the studies cited and findings explored here in this look at the 13th tipping point posit small group or community frameworks. The shifts they describe will not work so long as we can hide out as one of a million, or one of a billion, or the one with a secret country home, or the one who doesn't have to take responsibility because we're doing other important work.

Wednesday, November 1, 2006

Five Bads Bush will push past the election

Anxiety over what Republican smears and dirty tricks might be at hand in the last days of the Congressional campaign may be dominating, but what is not said is more important than what is said, if past elections are any indicator.

Both Al Gore and John Kerry were roundly criticized for not focusing on the key Democratic issues of economy, environment and social security. Gore chose "character" and Kerry sort of chose the war in Iraq.

At the same time, hundreds of decisions the administration and or Congress have to make are being pushed beyond the election. In mid-November 2004, Condoleezza Rice replaced Colin Powell as Secretary of State and Bush unveiled his plan to privatize Social Security.

What are the issues that are being pushed beyond November 7, 2006? Here is a guess about five:
  1. Mark Foley -- Keeping his record intact, House "Ethics" Committee Chair Doc Hastings, from Washington's 4th District, will issue no findings or reports on any ethics violations. Arguably the most corrupt Congress in the past 100 years looked clean to Do-Nothing Doc. Oversight is a Congressional responsibility the GOP has confused with "overlook" in the cases of Hammer DeLay, Bob Ney, Duke Cunningham, the Abramoff coterie, and Iraq. Hastings' motto as "Ethics" Committee head has been "Don't Ask, Don't Tell."

  2. The End of Democracy in Iraq -- Although not getting the media attention of "stay the course," the term "democracy" has also fallen from the official sound bites coming out of the White House. The pretense of a functional democracy in Iraq is over except as a myth for Middle America. The need for that myth will end with the closing of the polls on election night. The new regime propagated by the Neocons will be authoritarian and ruthless. It may arise under the guise of partition.

  3. The Economy -- The "political business cycle" is the practice of the incumbent executive to concentrate expenditures so as to gin the economic till in the months leading up to the election. Occasionally a compliant Fed will arrange interest rates to help. No doubt this most corrupt regime of the past 100 years has done all it can in this regard. But the ability of the Republicans to push the issue of the economy past November 7 is in part due to the absence of Democratic emphasis on this issue.

    Massive and rising indebtedness (both public and private), a tremendous $3 billion per day trade deficit, and the demonstrably growing gap between the rich and the rest of us are big issues to Americans. An ABC news poll demonstrated this: 22 percent identified Iraq as the most important issue for voters in the midterms, but 21 percent picked the economy, and economic issues like health care (13 percent) and gas prices (5 percent).

  4. The Coming Attack on Iran -- The neocons would love to attack Iran. This is similar to the privatization of Social Security, in that it cannot be admitted before the election, but any strength at all for Republicans' war mongering will be immediately translated into a drumbeat to attack. The neocons have spotlighted Iranian president Mahmoud Ahmadinejad, who has no constitutional authority or power in the Iranian government. At present the logistic support centers are not in readiness, but with the elections behind them, don't be surprised if the Bush-Cheney-Rumsfeld-Rove team to starts trying to justify such an invasion. It may be that the near certain massive disruption to oil flows that are sure to follow will cause the administration's corporate con backers to rein in such a plan, if they can. A Democratic Congress could apply brakes as well.

  5. The Immigration Policy Fiasco -- The 700 mile, $1.2 billion fence along the Mexican border will be continued so long as it feeds a favored corporation, but the immigration issue will be quietly discarded. Its only purpose was to give the right wing something other than Iraq, the deficit, corporate corruption and administration incompetence to talk about. Adjustments to NAFTA and the trade rules that have cut the incomes of the poorest Mexicans in half are a practical route to slowing migration north. But don't expect that to happen anytime soon.
As we go forward, progressive influence will be determined on how well we frame the issues and set the agenda around the economy, environment, social security and health care, development, of developing nations, and interaction with the international community.

After the election, the question will be, "What next?" Calm competence will be the order of the day. A Democratic win will be only the first step in the campaign to take the country back.

Sunday, October 22, 2006

Republican Taxes

In spite of the evidence, the Republican pretension that they are the party of low taxes and light government remains intact.

If you don't have a real issue, make one up, I guess.

By their incompetence alone they have created a government which is becoming more burdensome by the day, but it is not the damage of buffoonery I mean by "taxes." I am talking about real dollar payments by middle class Americans.

In some cases there are outright tax increases -- as with the loss of the sales tax deduction here in Washington. That's hundreds or thousands of dollars more you and I will owe on our federal returns next April. In other cases it is the paring back of government support, such as for child tax credits and college loan and grant supports.

Real tax hikes come in the form of deficits, too. These are taxes, just not this year. By borrowing from China, from wealthy America, and from its own social insurance funds to run the government, Bush, Inc., has effectively raised taxes on future America.

(We like to say "our children," but unless you're eighty years or older, those bonds are going to be paid back in your lifetime.)

Direct benefits to corporations through the tax code were instituted with the cuts in dividend and capital gains taxes.

These were extended last spring by Congressional action. As we've written here before, these were the highest priority of the Republican Congress. They were enacted in the spring because they couldn't stand the scrutiny of the election season. This is a direct shift of tax burden to Middle America.

But as big as these taxes are, most of the real dollars extracted by Republican legislation are paid to the corporate branch of the Party. Thus they escape attention. For Enron and Halliburton, Big Oil and Pharmaceuticals, government action has reached right into the pocket of Middle America and extracted the cash.

The hundreds of billions of dollars in excess Oil profits are taxes we pay to corporate America as a result of government (in)action.

These are taxes which result in nothing -- no schools, no roads, no police, no national defense. Considering the damage fossil fuels do to our health and environment, it is these payments which deserve the name "Death Tax."

The Great Enron Debacle was a huge tax on energy here in the West, a utility tax that drove some companies out of business and burdened households to the tune of thousands of dollars a year before the fraud was exposed. This was a direct result of corporations writing the regulations -- or in this case, the deregulations.

The Medicare Part D drug fiasco, which Central Washington's Doc Hastings played such a pivotal role in getting enacted, is a tax for the benefit of Big Pharmaceuticals.

By explicitly barring the government from using its market leverage, Congress ensured that hundreds of drugs are priced 10 to 70 percent above market value. This is shown in a recent study on the differential between Veterans Administration prices, but can also be gauged by looking at Canadian prices.

The difference is the tax.

Lastly, and most sadly, there is the tax of the Iraq War. The contribution of tens of thousands of Americans to our national future has already been lost, and every day we pay more in blood and treasure to this fiasco.

That sacrifice is trivialized by the Republicans' tax cuts for the rich. No sacrifice is expected on Wall Street or Park Avenue, even as we expect the ultimate sacrifice from these men and women.

Saturday, October 21, 2006

Nobody spends like the GOP

Listening to Mike McGavick attempt to apply the "big spender" brand to Maria Cantwell reminds us that the GOP is not about issues, it is about propaganda. Jumping up and down on the "big spender" hot button may impress the few remaining Americans who haven't learned to check the BS gauge, but the rest of us have learned, when Republicans talk, the facts generally run in the opposite direction.

"Big Spender" is a line borrowed from Karl Rove's focus groups. It has little connection to the sorry record of the past six years. The Republicans have controlled both houses of Congress and the Presidency. Spending has gone out of control. Combined with the tax cuts for the rich, you have the most profligate administration in history. All the Democrats can do is watch.

Here's the deficit chart again. The numbers include -- as they should -- borrowing from Social Security and Medicare funds.

Portraying Democrats as big spenders is dishonest and absurd after six years of the GOP's fiscal follies.

Friday, October 6, 2006

Next Washington is the Last Washington

The Governor's economic game plan is hard for a committed anti-corporatist to swallow. As our readers may know, the Guv is my favorite elected official.

Chris Gregoire is a leader, not a leaper in front of parades, not a facilitator, but one who determines what needs to be done and generates the energy and support to get it done. She's doing it in education. She's doing it in health care. In economic development, she needs to expand her sources.

As one who ascribes to corporations the authorship of the misery of billions and the frustration of most of the key public policies essential for a successful future, it is difficult for me to swallow the Governor's Next Washington project. (Check out the governor's prosperity page, too.)

This is the draft of Gregoire's economic game plan for the state. Marbled throughout it are all the elements of corporate capitalism which I hate so much.

It is embarrassing that the state and its governor are operating a deluxe welcome wagon for free agent corportions. Better we should take care of our citizens, including our current corporate citizens, through education, health care, transportation and disciplined regulation.

The Next Washington document came out ten days ago. I have not been able to get a critique together because Thomas Friedman's corporate bias has so thoroughly infected it.

The basics are also there, I admit. Number two is "Education is the single most important economic investment we can make."

The fact that there is no trade-off between economic development and enlightened environmental and social policy is explicit. But the absurdities are there, too, distilled in the conclusions (which does not match the manual of market capitalism, as usual) that states must compete for companies.

Corporations are the basic engines of prosperity. States and nations compete on the basis of cost as in cheap labor, on the basis of cost as in big tax giveaways, or on the basis of sophisticated public goods such as in an educated work force and sufficient infrastructure.

Of course, we hope to be in the last category, because we like education and sufficient infrastructure. But what happened to companies competing and states taking care of their citizens? That would be the situation right side up.

The Guv's Competitiveness Council document last spring was chaired by Alan Mullaly, or however you spell it, famous downsizer, outsourcer, tax code raider.

Once of Boeing, Mullaly is now downsizing, laying off and cutting everything except the earnings per share number at Ford. No wonder it concluded that corporations need welfare and the public needs to accept the harsh realities of the market.

It bothers me when the Guv says, as she often does, that when she goes to Beijing, she flies in on a Boeing jet, passes by a Microsoft office tower, and sits in a hotel across the street from a Starbucks, and it makes her proud.

Better she should reflect on the dozens of thousands of individuals in China benefitted by Washington's Universities. Those corporate logos don't represent five percent of the good that has come from Washington.

It is, in fact, by the education of people and by organization of our society through courts and regulatory agencies and by the facilitation of product movement via transportation systems that the state increases our common well-being. Those companies benefit from us and ride on our effort, not the other way around.

The role of corporations (at least if you look directly at how they act on the stage) seems to be to increase the benefit of stockholders and corporate managers wherever they live and whatever the cost to the rest of us.

Corporations adhere to this mission even if it means frustrating educated common sense. Nothing is more absurd, for example, than the current energy plan based on ever more extensive use of a shrinking resource that poisons the environment.

This is not the choice of anyone other than the corporate elite who muscled it in by way of their flunkies in the political process.

(Another parenthetical example is the dominance of public health care policy by corporate profiteers in the face of evidence and more evidence affirming that public health care systems are more efficient and less costly.)

By rediscovering and promoting the fundamental role of government in providing public goods which all can share -- irrespective of access to offices in Olympia -- the Guv will do far more to enhance economic development than she will be being the shill for corporate newcomers to our state.

Read the document. It's in discussion phase. Send your comments to:

Marc Baldwin
Executive Policy Advisor
Marc.Baldwin (at) Gov.WA.Gov.

Wednesday, October 4, 2006

Cynical GOP - 1, Prediction Tuesday - 0

In a move as baffling as it is inane, the Republican Congress failed to extend the deductibility of state sales taxes, costing citizens of Washington hundreds and thousands of dollars per year. Prediction Tuesday guaranteed last spring this would not happen, then promised again a month ago. We were wrong.

Republicans had used their window under the arcane budget rules to extend tax cuts for capital gains and dividends for two years -- from 2008 to 2010. The obvious assumption was that the more popular tax breaks for college expenses and state sales taxes would come later.

Here's how it works. Budget rules allow some deficit expansion without the jeopardy of filibuster. Republicans used this to feed the rich their dividend and capital gains cuts out to 2010. Yes, not this year, not next year -- these were already taken care of -- but years into the future.

Then, instead of just putting up the popular and deserved tax deductions to pass on their merits, the GOP hitched them to still more top end giveaways -- the estate tax elimination -- and the minimum wage tomfoolery.

When that "Trifecta" didn't pass, Prediction Tuesday said the GOP would cave. They would not be so ethically corrupt or politically obtuse to so blatantly raid the federal budget for the rich and ignore the middle class, at least not in an election year.

We were wrong.

Congress recessed without extending the middle class tax breaks.


The same Congress could well come back after the elections and make the changes. But that won't count. We were wrong. We admit it.

You might say this is payback for a Blue State. But Florida, Texas, and North Carolina are in the same boat -- sales tax and no state income tax. That's Bush, Bush and Frist.


Cynically, ever so cynically, Republicans blame Democrats.

As if.

Doc Hastings comes up a loser for the second day in a row, as well. Sales tax deductibility was his only positive contribution. With it gone, and new attention as House "Ethics" Committee chairman (following the Foley page scandals), Doc is looking more and more vulnerable.

Wednesday, September 27, 2006

George McGovern: Mileposts on the road out of Iraq

A blueprint for leaving Iraq is offered by George McGovern and William R. Polk in their new book Out of Iraq, being published in October by Simon & Schuster. An excerpt appeared in the latest edition of Harpers. It is a technically complete treatment of how to disengage in a responsible way. It begins with the compelling case for withdrawal, including:
  • Polls show only 2% of Iraqis consider Americans to be liberators.
  • Iraq has become the primary recruiting and training ground for terrorists; it is a strategic necessity to withdraw.
  • Current US expenditures run $246 million each day.
  • We continue to throw good money after bad and to throw good lives after those already wasted. The sacrifice undergone so far is, in fact, W's explicit rationalefor staying the course -- so "they will not have died in vain."
What is it that needs to be done to be responsible, and not to leave a stateless situation and chaos?
  • Establish an international stabilization force comprised of contingents from Muslim countries, paid for by the US, outfitted with arms, transportation and communication equipment currently in the theater. (est. cost: $5.5 billion for two years.)
  • Establish a police system out of the "home guards" working with the national police to stabilize and secure the country. Avoiding warlordism or dominance of one or another militia will take up to five years of training, coordination and the support of respected indigenous leaders. The US has no useful role to play in establishing this system. (cost: $1 billion.)
  • Avoid reconstituting a heavily armed national army. Such a force would bring more instability. The army ought to be reorganized in a manner similar to the US Army Corps of Engineers and assigned a rebuilding function. (cost: $500 million.)
  • End the construction and development of permanent US bases. The official line is that bases are not being built, but they are. (cost: savings of unknown billions.)
  • Immediately withdraw the mercenary "personal security details" by stopping payment on their contracts. These are the most despised symbol of the occupation. (cost: savings of unknown billions.)
  • Clean up land mines and other unexploded or radioactive ordinance. (cost: $250 million for initial survey, unknown cost for removal.)
  • Reconstruct Iraqi infrastructure. The World Bank estimates $25 billion in public infrastructure has been destroyed. The work should be done by Iraqis and funded through the most local civil authority possible to foment grass roots democracy. (cost: $25 billion +.)
  • Demolish the blast walls and wire barriers that scar Iraq physically and symbolically, using Iraqi workers. (cost: $500 million.)
  • Rescue and restore as much as possible the archeological and cultural sites. ["Astonishingly, one American camp was built on top of Babylon.... The 5,000-year-old site at Kish was also horribly damaged."] (cost: $750 million.)
  • Undertake an independent accounting of reconstruction funds. The UN handed over billions of dollars in Iraqi oil revenue to the CPA (Coalition Provisional Authority). Accounting was never completed. Massive fraud is evident in the billions of no-bid contracts delivered to US corporations like Halliburton. Reports are that oil has been sold at discount to American corporations. These issues need to be fully accounted for and remedies exacted.
  • All contracts currently let should be voided and the Iraqi government given the charge of renegotiating them or opening them to competitive international bids.
  • Reparations need to be made to civilians for lives lost and property destroyed, for injuries from the war or subsequent torture. Claims should be assessed by an independent international body. (cost: $2 billion.)
  • Reconstitution of the Iraqi civil service, which has been decimated with the departure of judges, lawyers, social workers, journalists, etc., following the war. (cost: $500 million.)
  • Reconstitution of the Iraqi public health system, including recruitment and training or return of thousands of public health workers, as well as reconstruction of hundreds of health centers, clinics and hospitals. (cost: $20 billion.)
  • Official and unofficial apologies for the devastation visited on the Iraqi people. (cost: ?)
Even if these costs were twice the numbers indicated, the savings to the US would be in the hundreds of billions of dollars. Joseph Stiglitz and Linda Bilmes have estimated the cost of four more years in Iraq at $1 trillion.

McGovern and Polk call for a withdrawal of troops and the institution of a multinational force. Certainly the American senior command needs to be replaced by competent internationally respected commanders. But the world cannot afford to leave chaos on the ground or the opportunity for a permanent blood bath.

Better would be the multinational force identified by McGovern and Polk, backed by Coalition troops under UN or NATO command in camps away from the populace, to enforce a separation of warring sides and prevent home guards and militias from becoming expeditionary armies.

We've made a helluva mess in Iraq, and it's going to take a complex and massive effort to set things even close to right, but it needs to be done. Any alternative will be even more difficult.

Thursday, September 21, 2006

RIP Revenue Tax Force

It was a good day for risk-takers at the Tacoma city council's study session Tuesday. Tacomans have to be heartened to see how quickly the Council blew the smoke off the Majority Report of the City Services Tax Task Force.

The chair of the task force wasn't halfway through a tedious Power Point presentation when Mayor Bill Baarsma pegged the principle recommendation as a "non-starter."

Some other apt questions followed from other Council members, which caused more discomfort. (e.g., the majority's suggestion was that the Council "explore" the alternative. The apt question? What about it needs exploring?)

My personal discomfort came in the few hours before the meeting. I spent it in solitude, with a focused visualization of something between an inquisition and a public dunking. As it turns out, I was called upon to introduce the Minority Report, and acquitted myself tolerably.

At least I didn't swallow my tie, and the Council's attention seemed to be in the "on" position.

If you've been following this adventure, you'll know why I couldn't go along with the majority and instead, with a single co-conspirator, submitted a Minority Report, containing actual revenue options and a clear critique of the main concept and its preferred (by the majority) variation.

At a minimum I think we salvaged something of the process with which to go forward, although "going forward" means being referred to the Finance Committee, not the early advisory referendum envisioned earlier. (The Council may have been more aware of our activities than I suspected.)

So, Rational Revenue Enhancement - 1, Self-Interested Process Manipulation - 0.

The "city services tax" concept is dead, insofar as it is a predominantly property based tax. There will be no shift from business to residents.

And the revenue options we developed in the Minority Report are still on the table, though it be a side table.

Tacoma's financing problems are not unique. If we can make something work here, it could work in other strapped Washington cities. The revenue gap is not going away without some treatment. I'll keep you posted.

Sunday, September 17, 2006

Tester (D) leading in MT Senate race

Two out of ten U.S. Senate offices in the Pacific Northwest are being contested this election cycle. One is in Montana. The other, of course, is in Washington. Democrats are leading both races.

Democrat John Tester is leading incumbent Republican Conrad Burns in the Big Sky in what is a referendum on Burns (and Bush). The Republicans have promised to spend $10 million in the state, and Tester hopes to match it.

That's more than $20 per person -- and who knows how much per vote, since the electorate will be plenty turned off by November. Last cycle, Tom Daschle and John Thune conducted a media- and mail-a-thon in South Dakota and did little more for the Republic than give folks plenty of fire starter for the winter.

Burns is directly connected to indicted lobbyist Jack Abramoff. In an interview with Vanity Fair magazine, Abramoff said he and his staff were cozy with the Burns office, in a relationship that paid off in appropriations for clients.

Burns campaign has imploded mostly, however, on a series of gaffes and blunders, some of which are as embarrassing to Montanans as the corruption. Conrad lost it in front of a -- get this, in a post 9/11 world -- a group of firefighters. He attacked them for not doing their jobs effectively.

Late last month, Burns called on the governor (rising Democrat Brian Schweitzer) to call a state of emergency for an ongoing fire. The Governor had done that a full month earlier.

Then he implied his house painter, "a nice little Guatemalan man," might be illegal. His comment that the war on terror is a fight against those who "drive taxicabs in the daytime and kill at night," was ....

So it is Tester's race to lose, and he is showing no signs of doing that. In particular, to my mind, is his turning the tax question to appropriate advantage by attacking Burns for his tax hikes on education.

Tester's ‘Higher Education, Deeper Debt’ report shows the consequences of Sen. Burns’ tax increases on Montana students and their families.

Burns and other Republicans in the last budget cycle voted to cut student loan programs by $12.7 billion, ended tuition tax credits, and froze the maximum Pell Grant, the leading college scholarship program. This came at a time when the cost of tuition at Montana colleges and elsewhere is skyrocketing. Real tax increases on reall people.

Tester is a onetime public-school teacher and current president of the Montana Senate. He sports a flattop haircut and drives a pickup truck. ("Special interests will never hitch a ride in this truck).

And he currently works a farm of 1,800 acres. He was drawn into politics eight years ago as a result of the electricity deregulation fiasco which enriched Enron and gouged several Western states. Hopefully another Democrat in the Senate will mean an end to that kind of corporate feeding frenzy on America.

Should both Cantwell and Tester be elected, the Northwest's representation will be split between Democrats and Republicans.

Two Democrats from Washington, two from Montana, and one from Oregon. In the next cycle (2008) incumbents who will have to face the voters include Republican Larry Craig in Idaho, Gordon Smith in Oregon, and Ted Stevens in Alaska, along with Democrat Max Baucus in Montana.

Thursday, September 14, 2006

Tacoma: Municipal finance meets Mr. Paper

The virtual publication of the Minority Report of Tacoma's Revenue Tax Force (whose activities have been sporadically chronicled here over the past six or eight months -- see below) was delivered to the virtual in-boxes of city government this morning. The majority report is also e-available. Piles of real paper will arrive Monday.

At issue is the financial architecture of the city. Will it be strong enough or broad enough in the foundation to carry the demands for city services -- fire, police, library, streets and roads -- into the next few decades? Or not?

This is only step three in a journey of a thousand steps which had better get some momentum soon, or we're not getting there in this lifetime. Still, an inch closer is an inch closer.

It was fun. It was educational. I learned that who controls the process can control the outcome. Graduation comes Tuesday, at a city council study session.

If anybody else is working with the fiscal problems of Washington cities, it would be good to hear from you. Obviously the legislature and the Association of Washington Cities are interested, but I am not connected enough to know of any real relief in sight. All I see is more piling up on existing sales and property taxes.

Previous posts on the Tax Force:

Wednesday, September 13, 2006

WA-04 ripe for the picking

As soon as voters hear the message, Richard Wright will win in the 4th, according to a poll released today by Wright's campaign.

The Evans/McDonough Company surveyed likely voters in Washington's 4th District August 15-17 and found a startling shallowness of support for Tom DeLay lapdog Doc Hastings.

Anna Fahey, Wright's campaign manager, told me:
The amazing thing is that we've heard that this poll shows Hastings weaker than any of the other incumbents in the state -- at least in preliminary polling.

We're not sure how Darcy's new numbers measure up.

Hastings came back with his own poll numbers that show him in the lead, but we know that with 17% undecided and only 22% definitely voting for him the race is truly wide open at this late stage.

The fact is, when people hear our message and compare the candidates, Richard comes out on top.
Evan's/McDonough's findings:
  • Only one in five voters (22%) say they will "definitely vote to reelect Hastings." Another quarter (28%) say they will "probably vote to reelect Hastings." Hastings' combined reelect of 50% is extremely weak for a six-term incumbent and suggests that he is genuinely vulnerable.
  • Voters in this district are not happy about the direction of the country (59% wrong track) and are unusually pessimistic about the direction of their local area (40% wrong track). These are surprisingly negative numbers in a traditionally Republican district and suggest that voters in this district are looking for change.
  • Despite the fact that challenger Richard Wright is not well known at this point, Wright is within single digits of Hastings after voters hear a positive description of each candidate, and Wright pulls ahead of Hastings after the comparatives. After hearing additional information about Wright's positions as a conservative Democrat, Wright opens up a 10-point lead on Hastings.
  • Although Hastings is well-liked, his personal popularity does not translate into votes. Hastings has several issue positions and votes that are unpopular and out of step with the district. This, combined with the district's overall negative mood, keeps Hastings from being able to convert his personal popularity into vote support.
  • Richard Wright's resume as a conservative Democrat fits the 4th District well and appeals to Democrats, Independents and even Republicans. Once voters learn more about Wright, he pulls ahead of Hastings in a district where self-identified Republicans outnumber Democrats by 12 points, and where Hastings has a name ID advantage over Wright.
  • This survey shows that as Wright becomes better known in the district, Hastings' vote advantage will evaporate. There is a 38-point net shift in the survey towards Wright from the first vote to the final vote, suggesting that there are a significant number of persuadable voters in this district who are ready for change and looking for an alternative. Particularly noteworthy is Wright's lead among Independents after they hear comparatives among the candidates: 47% to 25%.
  • Finally, the shift to support for Wright over Hastings after voters hear the comparatives occurs among all 4th District citizens regardless of how often they have voted in recent elections, party affiliation, where they live in the District, and whether they are over or under the age of 50.


This memo is based on the results of a telephone survey of likely 2006 general election voters in Washington's 4th Congressional District. A total of 410 interviews were conducted August 15-17, 2006. The overall margin of error for these results is + 4.9 points at the 95% confidence interval.

Will Bush push the official collapse of Iraq past election day?

Joe Biden, me, senior Iraqi leaders, Les Gelb, and unnamed experts have one thought in common: partition of Iraq is inevitable, and better to do it soon, in an organized way, than wait for the bloodbath to run its course.

Meanwhile, George W. Bush is reading from Al Qaeda travel brochures while standing in front of a map of Iraq, telling the same lie over and over (and admittedly getting a few more adherents after each speech).

Democracy in Iraq is no longer leading the speech, because democracy has failed, and whatever happens after the Congressional elections, the next Bush mistake won't be the democracy promised eight short months ago.

How long can Bush and Rove distract the electorate from the sickening civil war of death squads or from the Iraq "reconstructed" for the benefit of his and Cheney's corporate buddies? Will it be long enough to get past the election, when "non-democratic" US action is the plan?

We posted here, let's see, in July, June, May,(on the roll-out of the Biden/Gelb plan) and March on the logic and desirability of partitioning the country and allowing the Iraqis to rebuild.

In August, Biden, the ranking Democrat on the Senate Foreign Relations Committee, repeated in compelling terms a plan for order and stability that involves partition, a plan developed with Les Gelb of the Council on Foreign Relations. ("A Plan to Hold Iraq Together," Washington Post, August 24,2006)

Specifically, (quote)

  • First, the plan calls for maintaining a unified Iraq by decentralizing it and giving Kurds, Shiites and Sunnis their own regions. The central government would be left in charge of common interests, such as border security and the distribution of oil revenue
  • Second, it would bind the Sunnis to the deal by guaranteeing them a proportionate share of oil revenue. Each group would have an incentive to maximize oil production, making oil the glue that binds the country together.
  • Third, the plan would create a massive jobs program while increasing reconstruction aid -- especially from the oil-rich Gulf states -- but tying it to the protection of minority rights.
  • Fourth, it would convene an international conference that would produce a regional nonaggression pact and create a Contact Group to enforce regional commitments
  • Fifth, it would begin the phased redeployment of U.S. forces this year and withdraw most of them by the end of 2007, while maintaining a small follow-on force to keep the neighbors honest and to strike any concentration of terrorists.
(end quote)

The whole Biden piece is worth reading. Finally a way out. A hard way, no doubt, but better hard reality than simplistic fantasy.

Unmarked in this space, but the subject of a floor speech by redoubtable Jim McDermott in the House, was the July revelation in Britain's Independent, that high Iraqi officials admitted "A sectarian break-up of Iraq is now inevitable."

"Iraq as a political project is finished," a senior government official was quoted as saying, adding: "The parties have moved to plan B." He said that the Shia, Sunni and Kurdish parties were now looking at ways to divide Iraq between them and to decide the future of Baghdad, where there is a mixed population. "There is serious talk of Baghdad being divided into [Shia] east and [Sunni] west," he said.
"The government is all in the Green Zone like the previous one and they have left the streets to the terrorists," said Mahmoud Othman, a veteran Iraqi politician. He said the situation would be made worse by the war in Lebanon because it would intensify the struggle between Iran and the US being staged in Iraq. The Iraqi crisis would now receive much reduced international attention.
We have created an environment of weak government, a failing state, with convenient US soldiers as targets. Just the sort of vacation spot terrorists might enjoy.

It's time to get the security and reconstruction on the road, by admitting the inevitable and enabling the natural domestic leadership to take responsibility and giving the indigenous population, over 60 percent of whom are unemployed, a job rebuilding their country.

Or wait until the day after the election to see what Bush-Rumsfeld-Cheney have in mind.

P.S.: In recent days the "federalism" (read partition) idea has gained currency among the Shiites. It is already a fact for the Kurds, who have their soldiers guarding the border. Below is a possible map. See the Independent for a discussion of the current federalism plan.

# Posted by Alan : 1:32 PM

Saturday, September 9, 2006

Preparing for a potential pandemic

Ron Sims and Dorothy Teeter have written a simple, broad, informative and easy to read overview of the potential for pandemic influenza.

It arrived in my mail late last week with illustrations and everything as the latest edition of the King County newsletter "Health Matters." Just the thing for someone who is easily confused, particularly about unfamiliar and alarming sounding events, like me.

The link is here. Health Matters. Print it out. Have your kids read it to you. Below is information on how to get hard copies, for yourself or your group. Better than anything else I have seen, it lets you know how to prepare and why and what to expect, from macro to micro.

  • Everybody will be sick or will be taking care of sick people
  • Avian flu is not pandemic flu
  • The single best thing you can do to avoid getting sick is to wash your hands
  • Health services will be rationed, health care givers will be sick, too, so be prepared to take care of sick people at home
  • Be ready to stay home yourself
The King County web site is good, too.

Also from the World Health Organization "Ten Things to Know."

Eliminating the fear factor as this sort of information and straight talk can do is a good start in successfully dealing with this event.
Re Health Matters Pandemic issue, If you want one hard copy for yourself or fifty for your group, contact
Meredith Li-Vollmer
Risk Communication Specialist
Public Health - Seattle & King County
999 3rd Avenue, Suite 1200
Seattle, WA 98104
(206) 296-4313

7:00 Tonight in Wenatchee

The keynote speaker for a benefit for Richard Wright and Peter Goldmark that is being billed as the "largest ever Democratic event in Central Washington" will be popular Montana governor Brian Schweitzer.

Goldmark, the Democratic candidate from the 5th Congressional District, will fly his single engine plane to Helena and return to Wenatchee for the Chelan-Douglas County Democrats’ annual Jefferson Jackson dinner.

The fundraiser at the Wenatchee Convention Center starts at 7:00 PM, after a private reception, and runs to 10:00. It could be a galvanizing event for a new breed of straight-talking, high quality Democrats running for office in the Red Zone.

Schweitzer has a 70% job approval rating in a state with a majority of registered Republicans. The Montana legislature is now controlled by Democrats and the Democratic US Senate candidate, Jon Tester -- another Montana farmer -- is likely to beat the long-term Republican incumbent, Sen. Conrad Burns.

The burly, funny Montana rancher reportedly volunteered for the keynote address when he found out Wright was running against long-time Tom DeLay lapdog and House "Ethics" Committee Chairman Doc Hastings.

Tickets sold have topped 430, but there may still be room at the Wenatchee Convention Center.

There is a lot of buzz about Schweitzer. Newsweek's Howard Fineman and others have written about his political acumen and his never-talk-down-to-the-people populist charm. He is a champion of the environment, alternative energy and clean coal technology.

Schweitzer aims to make Montana a "lobbyist-free zone" and worked with Montana's libertarians to significantly curtail the Patriot Act there.

High Plains Democrats like Schweitzer, Goldmark and Wright have a real chance to connnect the blue across the top of the country, from Washington through Montana and into the Dakotas and Minnesota.

These guys are not going to touch the Second Amendment, but they are up to their eyeballs in integrity, intelligence and competence.

It should be fun.

Friday, September 8, 2006

Mulally's been there, done that

Ford is reeling. It has the oldest fleet on the road. Its F series trucks and Explorers are getting hammered by high gas prices.

Alan Mulally made a big contribution at Boeing by cutting production times on the 787 and shortening product rollout schedules. Can he do the same at Ford?

It doesn't matter. Half a dozen automakers are scrambling for the dwindling American car market. This is no two-man fight as with Airbus and Boeing. GM is conducting a perpetual price war.

Toyota has grabbed the mainstream auto market and is now moving into trucks. (Toyota surpassed Ford in US sales in July for the first time in history.) Chrysler, Honda, Nissan, Hyundai, and more.

U.S. automakers got hosed in the 1980s by not being ready for high gas prices and by the high dollar created by Reagan's big deficits. It happened again. Ford can turn it around twice and still lose half the troops before they take a hill.

By the way, - how long has Alan Mulally been on the job at Ford? It was announced yesterday, but my guess is a minimum three weeks.

I don't have any inside stuff, I just note that August 18th, Ford announced a slash in production that bears the Mulally stamp.

"Full details" of additional actions were to be announced in September. Otherwise the big "decline comment" on particulars. It's September.

Obviously Boeing knew he was leaving Chicago for Detroit. They had his replacements lined up and grinning.

And it makes sense for the new CEO to avoid the Simon Legree label the first day on the job. Imagine what would have happened had Mulally been hired, then announced mass production cuts.

The sourest note on Mulally's trumpet was when he began to wave the flag.
"This is a United States icon, and Boeing is a United States icon, and some people think the United States can't compete in the design of products, and I think we can. We've shown that at Commercial Airplanes, and I think absolutely we've shown that at Ford."

The United States may have corporate bosses in the White House and Halls of Congress, but corporations have saved their benefits for a chosen few, not the rest of us.

At Boeing Mulally outsourced, downsized and even sent sensitive technology to Japan -- the wing for God's sake -- to be manufactured there.

The United States lost tens of thousands of jobs under Mulally so he could keep a corporate icon shining. When you think about it, it's a perfect illustration of the corporate subversion of the middle class economy.

And let there be no doubt in anybody's mind that under Mulally, Ford will close U.S. plants and open others elsewhere.

If patriotism is a Ford, expect to see Alan Mulally keep his Lexus.

Thursday, September 7, 2006

Recovery? Who? Where?

The economic recovery and the onset of good times reported on the financial pages have passed much of America by in the night. Median income for those under 65 fell, the poverty rate rose, and more people by number and percent are without health insurance today than at the beginning of this "recovery" in 2001. These are the findings of a white paper released Friday by the Center on Budget and Policy Priorities (CBPP).
  • Median income for those under 65 fell again in 2005 and is now $2,000 lower in real (inflation-adjusted) dollars than in 2001. That's a 3.7 percent cut.

  • The poverty rate is higher today (12.6 percent) than in 2001 (11.7 percent).

  • Health Insurance coverage is lower. The number and percentage of people without health insurance was much higher at the start of 2006 than in 2001.
These findings corroborate the feelings of a good majority of Americans. The economy they see is not doing as well as the economy the Bush machine describes in its well-orchestrated media pushes. Even the official unemployment rate is suspect, as we posted (see unemployment with a stable participation rate post).

So who is recovering?

A second CBPP white paper released Thursday has a positive ID on that.
  • In the first half of 2006 the piece of the pie going to corporate profits was bigger than at any time since 1950, having grown under Bush at twice the average rate of other recoveries.

  • The share going to wages and salaries was at its lowest level on record (77 years).

  • Hourly private nonsupervisory wage earners (four out of five of us) made less now than when the "recovery" began in 2001 in real (inflation-adjusted) terms. This came in spite of productivity numbers growing faster than in all but one of the previous recoveries. This blows up the official line that productivity gets translated directly into wage gains.
This is not really a recovery. It is an accounting gimmick, as we borrow growth from the future via massive federal deficits (see the "Net GDP" post ) and enormous and growing private debt (see borrowing chart post).

The economy is not stronger, but much weaker.

Prediction Tuesday says any more of this kind of "recovery" and we'll all be dead. For our scare story on what happens if we borrow too much see scare story post. And for our early warning about when a recovery is not a recovery, see "A Jobless Recovery is not a Recovery," Parts 1, 2, and 3.