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

Saturday, July 29, 2006

Saturday at the Races

Washington's 4th District runs from Chelan down through Wenatchee, Ellensburg, on into the Yakima Valley, all the way to the Tri-Cities. It is currently represented by House Corruption Committee Chairman Doc Hastings. He has a formidable challenger in Democrat Richard Wright. (See our interview with Wright.) This seat is as ripe as an apple in October and ready for picking. Contributors and, particularly, volunteers can make a big difference here.

Hastings has not quit the other Washington, where he will no doubt remain even after his defeat, in the offices of one or another lobbying firm, to collect some of the vouchers he has accumulated. But he has begun to show signs of discomfort. His web site has been updated for the first time in two years.

His weekly letters back home studiously ignore the Iraq War or Hastings' role as Coverup in Chief to the most corrupt Congress of the past one hundred years. Immigration is also not present as an issue. He does mention the Ice Age, which has some association with the environment, I suppose. And he does try taxes, where his "responsible tax relief" is, as you might guess, code for the irresponsible tax giveaways to the wealthy that have lifted the burden of $7 trillion in new debt onto our and our children's' shoulders.

Symptomatic of Hastings contribution remains his role in holding the vote open on Medicare Part D long enough for billions in corporate profits to squeeze through. Completely descriptive of his integrity and moral force has been his chairmanship of the House Ethics Committee.

As Ethics Watchdog he has been a Lapdog. He kept the lights off Republican indecencies without major exception. Light has come in other windows, to be sure; Duke Cunningham is in jail; Hammer DeLay has resigned; DeLay and others are being actively prosecuted. A more complete accounting will arrive with a Democratic victory in November, should that blessed day ever arrive.

But Hastings has been ever the loyal corporal in the Right Wing Army, doing what he is told, marching our soldiers in front of him into Iraq, deeper into Iraq, facilitating the feeding of the predatory corporations on his constituents, and generally making nice with the nasty.

The Democratic Party has chosen to soft pedal this race. Republicans attack their enemies with big dollars and smear. Tom DeLay was famous for it. Why the party establishment ignores this one is beyond me.

Hastings is the poster boy for what is wrong with Congress. When he finally has to defend himself in public, he'll be in plenty of trouble.

Wright, on the other hand, is a genuinely capable man and a genuinely good person. He has a lot of energy and a good plan. Right now he's organizing 600 volunteers for the next push. If you have phone skills, personality, experience, or just motivation, you could be a part of a major grass roots coup. Learn more and sign up to volunteer here.

Gasbag Politics

In a last-ditch effort to make Dave Reichert seem somehow relevant, the Republican campaign spin machine moved in to give him his first semi-meaningful bill since he entered congress.

In the account, Dave Reichert had virtually complete command of the facts and twisted arms in the effort to push through his first major piece of legislation last week. In fact, that should read Dave Reichert had virtually complete command of his arms and twisted facts in his account of a very minor piece of legislation last week.

When HR 5852 becomes law, one more bureaucrat will be hired into the Department of Homeland Security, no doubt the son of a Republican fundraiser. Otherwise the federal action will be another study. The most significant thing it did was to withhold federal money unless the states jump through another hoop. The 21st Century Emergency Communications Act was more notable for its gasbag prose than its influence on anything of substance.

I know, when you hear grandiosity like the 21st Century Emergency Communications Act you grab for your wallet, like the states did last week for the Business Activity Simplification Act, which would have made life much less simple in some states, like ours, and easier only for the interstate corporations allowed to skate on their taxes. But Dave had an even better title for the bill on his website: The Reichert Emergency Communications Bill.

In fact, the bill was co-written by the ranking Democrat and basically scripted in four hearings the committee held. He is referred to as "Freshman Chairman" Reichert, although his chairmanship is of a minor subcommittee whose name is longer than its significance.

The website presentation gets points for nerve, like when the Chairman of the Committee on Homeland Security is quoted as saying "This bill will help save lives ... Without [Reichert] this important piece of legislation would not have been possible." Right. And this finger is holding up the moon. The bill passed the House 414-2, proving both that Dave was not needed and that the bill itself was politically insignificant.

Still, Reichert now gets to use active verbs, like "establishes" a position, "requires" an assessment, "facilitates" meetings, "elevates" importance (a very good example). Dave's previously authored bills ran to getting obscure truck parts into the country without tariffs, I believe, and did not require the gasbag ghost writers or even public notice. His previous press releases had to be satisfied with "touts," "congratulates," "applauds," and occasionally, I suppose, though I don't remember seeing it, "deplores." Not nearly on the level of "elevates."

Thursday, July 27, 2006

Partition Iraq

The history has already been written. Three years after the invasion and occupation of Iraq, the situation is still deteriorating. No matter how much happy talk and media management comes out of the White House spin room, it cannot paper over the continuing grisly debacle. The right wing religious nuts of America and the Middle East have come together to direct a combat of death squads and terrorist bombings, unemployment and desperation, a civil war in which the role of American troops is to serve as targets.

Bush flew into Iraq June 13 to announce a new emphasis on security in Baghdad. Five weeks later the White House announced another new emphasis on security in Baghdad. Shiite death squads reportedly operate out of offices in the new, democratic government.

US policy is focused on maintaining a foothold for Big Oil. Not a big rallying cry to the troops, so they don't mention it too much. The men and women in uniform get to make up their own rallying cries. Recognizing futility, many progressives call for withdrawal. After all, American forces seem to be making matters worse rather than better, and Iraqis will have to step up sooner or later. These suggestions become targets for the Rovian "cut and run" attack.

The US cannot leave with the police, armed forces and intelligence apparatus in the hands of one side of a civil war. The answer, not a good answer, but the only answer, is to segregate the parties -- the Shiites, Kurds and Sunnis. We can do it now, however messy it might be logistically, or we can let it happen after a bloodbath. Local communities need to control their own police, just as they need to become the locus of economic rebuilding. For heaven's sake, kick Halliburton, Bechtel and the others out and go to a Marshall Plan style program. Right now US dollars are going to US companies. Iraq and Iraqis are getting nothing but incompetence and worse.

And I do compromise with the devil on this one. That is, American troops ought to be redeployed to the bases within the country on the pretext of being close at hand should Iran invade or should a genocide break out. Making Iraq safe for democracy is a sham for the benefit of the boys in Mayberry. The men in the back rooms eat, drink and spit up oil and the strategic necessity of growing its supply from the Gulf. Get the GIs somewhere they can defend themselves.

Otherwise, a very loose federation of states, with provinces responsible for their own internal security, and security forces drawn from the communities in which they operate. Economic development coordination needs to be assigned to an independent authority, the UN or the Arab League, with legitimacy and credibility.

The Iraq invasion and occupation has failed. Continued failure is not going to give us any better options. Bush, of course, will never do this. I have no illusions. He is too busy denying the failure and drumming up distractions in the war on terror like the tragic Lebanon farce. But there is no alternative long term, and the sooner it happens, the better for all of us.

Wednesday, July 26, 2006

Latest corporate tax giveaway blocked

The House bill which would have eviscerated Washington's B&O was withdrawn just hours before it was to come to a vote Tuesday. The Business Activity Tax Simplification Act, so called, apparently, because it would have simplified many corporate taxes out of existence, would have hit Washington hard. Some estimates ran to $700 million.

The National Governors Association criticized the bill as a "federal corporate tax cut using state tax dollars." According to analysis done by the Center for Budget and Policy Priorities' Michael Mazerov, it would have redefined the way business activity is defined, and bar states from taxing many kinds of businesses they currently tax, for example:
  • a television network would not be taxable in a state even if it has affiliate stations and local cable systems within the state that relay its programming;

  • a restaurant franchisor like Subway or Dunkin’ Donuts would not be taxable in a state, no matter how many franchises it has there; and

  • a bank would not be taxable within a state even if it hires independent contractors there to process mortgage loan applications.
“The bill is a recipe for extensive litigation between states and corporations,” Mazerov said, “because a number of the new rules that the bill would impose to limit state taxing authority are arbitrary, vaguely defined, or inconsistent.” For example, a state could tax a corporation that has a million dollars’ worth of inventory in the state, but it could not tax a corporation that has a million dollars’ worth of unfinished goods in the state that are being processed into finished goods by another firm.

It's over. This corporate raid couldn't stand an election season in full view.

Saturday, July 22, 2006

Saturday at the Races

Darcy Burner is making Dave Reichert look like a fencepost, but she didn't get early media buys from the DCCC (Democratic Congressional Campaign Committee) according to the Fix at the Washington Post. Nor did Washington's 8th District make it into the top 20 of seats most likely to change party.

Other lists are different. Burner does appear on other DCCC media target lists, according to the AP and appears on the DCCC'S "Red to Blue First Wave" (at the top, too, because her name begins with B)

The 20 most likely to change are listed at the bottom. A lot of the strength of candidates early on is gauged, sensibly enough, by how much money they raise. Democrats -- including Burner -- are doing well.

That's fine. But what does the money really mean? First, it means devoted partisans get more than one vote, and these folks may not represent the district at large. Second, it means we are going to see massive and negative media all over October. Third, it means that people who are getting paid off -- like Doc Hastings in Washington's 4th District -- show up ahead of legitimate contenders like his Democratic opponent Richard Wright.

Having family in South Dakota, I am familiar with the brain death that is caused by too much money in campaigns. When Thune ran against Daschle as part of the GOP's most blatant hit last election, yard signs in Rapid City were the size of billboards. The nightly news was a few minutes of weather and sports squeezed in between attack ads. Every day enough campaign literature arrived in your mailbox to paper a dog pound. It didn't lead to a very rational election.

Doc Hastings who sits (and looks) like a potato in Central Washington may not have to run any kind of campaign. By ignoring his opponent Richard Wright, Democrats are allowing Hastings not to run. Doc covered up the most corrupt Congress in modern history in his position as House Ethics Committee Chair. He held the door open for the disastrous Medicare Part D drug fiasco. Do elections hold people accountable? I continue to hope so. And can Doc really stand on the House Republicans' platform to criminalize immigration in the highly agricultural 4th? Not likely.

Is there any way to inoculate the electorate against too much money in politics? Probably not, at least not completely. But we'd better try. The Republic and its electorate can't make good choices based on 6 weeks of Shock and Awe leading up to its elections.

The Fix's top 20 and who gets them is below:

1. IA-01 D
2. CO-07 D
3. AZ-08 D
4. OH-18 D
5. PA-06 D
6. IN-09 D
7. CT-02 D
8. FL-22 D
9. CT-04 D
10. IN-08 D
11. NM-01 D
12. IA-03 R
13. KY-04 D
14. NC-11 D
15. IL-06 D
16. NY-24 D
17. PA-07 D
18. VT (at large) R
19. VA-02 D
20. IL-08 D

Monday, July 17, 2006

Prediction Tuesday: The Guv's Touch

Early in her administration, Gov. Gregoire announced a drought emergency. It hasn't stopped raining since. Last session she put away nearly a billion dollars in reserves. Tax revenues keep climbing. If she'd say something dire about my paycheck I could probably retire.

The significant erosion I've predicted to set in before next March is not happening yet. It is not clear why. Even ChangMook Sohn, chief state forecaster, says "Recent economic news has been positive, but not nearly as good as this month's revenue numbers imply."

Construction is good for the state's coffers and for economic activity, and we're still getting push from that sector. Construction firms tend to be smaller and more independent, which overexposes them to the B&O tax. The real estate excise tax, obviously also connected to construction, was the biggest gainer in the latest report. Construction labor comes in under the retail sales tax.

But let's not overlook the state's notoriously regressive tax structure. We do better when low-paid people do better.

So, yes, I blame the immigrants. If they weren't so damned industrious, and if they'd just stop spending, the dreary days I predict would get here a lot sooner. Them and the minimum wage being at an almost reasonable level. Both these factors increase the multiplier, which is the same as saying you get more economic activity for the same dollar. More sizzle for the buck. But look out, the same dynamic works in reverse, and will exaggerate any decline.

Housing giveth and housing will taketh away. Mortgage rates go up, sales go down. Permits were down 54 percent in the first quarter, and stayed down in the second. Here's the cover of the June forecast.

Notice (by the dates at the bottom, which may be fuzzy) that the predicted peak is last quarter. The official forecast calls for a leveling off. I suggest a slide. Not a cliff, but a slope steep enough so we'd better be roped together. That's been my answer for six months and I'm sticking to it.

Still, if I asked nicely, do you think the Guv would issue an edict on gray hair?

Wednesday, July 12, 2006

Confessions of an Economic Hit Man

This book must be read. It is easy to read, like a spy novel. It is hard to read, like looking at a corpse.

Confessions of an Economic Hit Man, by John Perkins [Penguin 2006: paperback]

We are all dead if we do not realize that what seems to be ignorance, or myopia, or simple stupidity at the highest levels of our government is in reality intentional. The immense debt of the Third World, for example, was foisted upon them in the name of development, but for the purpose of Empire. The writer of this book John Perkins was one of the men who did it.

Knowing and understanding this removes the veil of good intentions and strips the pretense away from the predator culture. We all knew it was absurd, but this proves it beyond a doubt. It leaves Dick Cheney and the Bush Family and the Weinbergers and Shultzes and Bechtels and Halliburtons and Texacos on stage, naked and without their masks. Their posturing and pretensions become absurd, like a Japanese NĂ´ Play performed in the nude, with pot bellies and tiny hangy down things bare to the world.

The predator corporations, the international banks, and the empire builders in government combined and colluded in one financial scheme after another. To what end? By demanding domination rather than dealing with other nations on the basis of mutual respect and cooperation, they have created a corruption no less dysfunctional than that of the Soviet Union's command economy.

The so-called free, open and efficient markets are not. We have alienated and enraged those with whom we need to partner. We have exploited and despoiled the resources we as a planet need to survive.

How much more effective and convincing this message is when displayed graphically, as in this book, then when summarized as in my polemic. Chilling, but motivating. In the extreme.

Tuesday, July 11, 2006

The Life Tax

The "Death Tax" is something that has concerned me for a couple of weeks now, and not only because the wealthy right and their chief spinmeister have again tied up our army with their squad in a made-for-media skirmish.

Although the "death tax" [properly known as the estate tax] is not a tax on death, but a tax on the fortunes of a select group of millionaires, it has achieved legitimacy under this title and has already performed its political purpose, whether or not it is rescinded by Congress. Meanwhile, the mammoth fiscal calamity that is the federal budget has been spared from serious attention, much less repair.

But I am a compassionate man, and I understand there is also a great anxiety among those few multimillionaires affected by the estate tax. It is really, at its root, a religious question.

These folks have elevated Materialism to such a level that they are convinced that they will live on in the form of their estate. Thus to tax it will actually harm their residual souls. It is a strange obverse interpretation of Jesus' "Where your fortune is, there will your heart be also."

You and I, of course, know that these estates will most likely be expended in drugs and profligacy within a few years, and that the destination of these multimillionaires is not to be transformed or absorbed into mansions or portfolios of stock.

Their fate, unfortunately, is one of three. One, in the Judeo-Christian-Muslim opinion, they pass straight into Hell. Two, in the Buddhist-Hindu school, they will return as a lower form of life; if they are lucky enough to be human, it will be as one of the many billions of people living lives of abject destitution, perhaps even the most wretched of all.

Or three, they will cease existence in any form and pass into the Atheists' vacuum of existence. This last, of course, would be best, since it means their accumulation was meaningless, not morally damning. Still, they should spend it while alive.

But this is not an attempt to steal a tenet of the New Church of Materialism. I am tolerant of all faiths. AND I have an answer to all problems. A win-win. The Life Tax.

Yes. The Life Tax.

Think of its title, just for a moment. I like its title. In fact, to justify its title completely, I propose we make it a tax not only on the living, but for the living. I am insisting here and now that one-tenth of its proceeds be set aside to eliminate hunger and give clean drinking water to every soul on the planet. Just one tenth would do it. A tithe, so to speak, on the Life Tax. But that is a minor point.

The Life Tax would tax these wealthy folks while they are alive! Neat, huh?

Sure it sounds like a simple reversal of the Bush tax cuts for the rich, but it's more than that. [The Bush tax cuts have indebted our nation for decades to come. I'm surprised nobody has pointed out that this debt was intentional, not just a give-away. As we have made foreign nations subservient to international banks, now we are doing ourselves the same favor. But I digress.]

As I say, the Life Tax is more than a reversal of the tax cuts for the rich. It would establish a top marginal tax rate of 90% for those making $1 million or more per year. This was the tax rate back when the economy was strong and before we needed corporate avarice to motivate us.

The Life Tax solves our problems. We can vote on a tax with an uplifting title. We can do something meaningful about the sinking ship of the nation's finances. We can, as I mentioned, eliminate hunger and thirst from the globe. And most importantly, it is my hope that the Life Tax will save rich Americans from having to worry about the Death Tax.

Tuesday, July 4, 2006

The Declaration of Independence

Posted for your reading pleasure on this Fourth of July, 2006, a truly beautiful document:

IN CONGRESS, July 4, 1776.

The unanimous Declaration of the thirteen United States of America,

When in the Course of human events, it becomes necessary for one people to dissolve the political bands which have connected them with another, and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature's God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation.

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.

That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed,

That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.

Prudence, indeed, will dictate that Governments long established should not be changed for light and transient causes; and accordingly all experience hath shewn, that mankind are more disposed to suffer, while evils are sufferable, than to right themselves by abolishing the forms to which they are accustomed.

But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security.--Such has been the patient sufferance of these Colonies; and such is now the necessity which constrains them to alter their former Systems of Government.

The history of the present King of Great Britain is a history of repeated injuries and usurpations, all having in direct object the establishment of an absolute Tyranny over these States. To prove this, let Facts be submitted to a candid world.

He has refused his Assent to Laws, the most wholesome and necessary for the public good.

He has forbidden his Governors to pass Laws of immediate and pressing importance, unless suspended in their operation till his Assent should be obtained; and when so suspended, he has utterly neglected to attend to them.

He has refused to pass other Laws for the accommodation of large districts of people, unless those people would relinquish the right of Representation in the Legislature, a right inestimable to them and formidable to tyrants only.

He has called together legislative bodies at places unusual, uncomfortable, and distant from the depository of their public Records, for the sole purpose of fatiguing them into compliance with his measures.

He has dissolved Representative Houses repeatedly, for opposing with manly firmness his invasions on the rights of the people.

He has refused for a long time, after such dissolutions, to cause others to be elected; whereby the Legislative powers, incapable of Annihilation, have returned to the People at large for their exercise; the State remaining in the mean time exposed to all the dangers of invasion from without, and convulsions within.

He has endeavoured to prevent the population of these States; for that purpose obstructing the Laws for Naturalization of Foreigners; refusing to pass others to encourage their migrations hither, and raising the conditions of new Appropriations of Lands.

He has obstructed the Administration of Justice, by refusing his Assent to Laws for establishing Judiciary powers.

He has made Judges dependent on his Will alone, for the tenure of their offices, and the amount and payment of their salaries.

He has erected a multitude of New Offices, and sent hither swarms of Officers to harrass our people, and eat out their substance.

He has kept among us, in times of peace, Standing Armies without the Consent of our legislatures.

He has affected to render the Military independent of and superior to the Civil power.

He has combined with others to subject us to a jurisdiction foreign to our constitution, and unacknowledged by our laws; giving his Assent to their Acts of pretended Legislation:

For Quartering large bodies of armed troops among us:

For protecting them, by a mock Trial, from punishment for any Murders which they should commit on the Inhabitants of these States:

For cutting off our Trade with all parts of the world:

For imposing Taxes on us without our Consent:

For depriving us in many cases, of the benefits of Trial by Jury:

For transporting us beyond Seas to be tried for pretended offences

For abolishing the free System of English Laws in a neighbouring Province, establishing therein an Arbitrary government, and enlarging its Boundaries so as to render it at once an example and fit instrument for introducing the same absolute rule into these Colonies:

For taking away our Charters, abolishing our most valuable Laws, and altering fundamentally the Forms of our Governments:

For suspending our own Legislatures, and declaring themselves invested with power to legislate for us in all cases whatsoever.

He has abdicated Government here, by declaring us out of his Protection and waging War against us.

He has plundered our seas, ravaged our Coasts, burnt our towns, and destroyed the lives of our people.

He is at this time transporting large Armies of foreign Mercenaries to compleat the works of death, desolation and tyranny, already begun with circumstances of Cruelty & perfidy scarcely paralleled in the most barbarous ages, and totally unworthy the Head of a civilized nation.

He has constrained our fellow Citizens taken Captive on the high Seas to bear Arms against their Country, to become the executioners of their friends and Brethren, or to fall themselves by their Hands.

He has excited domestic insurrections amongst us, and has endeavoured to bring on the inhabitants of our frontiers, the merciless Indian Savages, whose known rule of warfare, is an undistinguished destruction of all ages, sexes and conditions.

In every stage of these Oppressions We have Petitioned for Redress in the most humble terms: Our repeated Petitions have been answered only by repeated injury. A Prince whose character is thus marked by every act which may define a Tyrant, is unfit to be the ruler of a free people.

Nor have We been wanting in attentions to our Brittish brethren. We have warned them from time to time of attempts by their legislature to extend an unwarrantable jurisdiction over us. We have reminded them of the circumstances of our emigration and settlement here.

We have appealed to their native justice and magnanimity, and we have conjured them by the ties of our common kindred to disavow these usurpations, which, would inevitably interrupt our connections and correspondence. They too have been deaf to the voice of justice and of consanguinity.

We must, therefore, acquiesce in the necessity, which denounces our Separation, and hold them, as we hold the rest of mankind, Enemies in War, in Peace Friends.

We, therefore, the Representatives of the united States of America, in General Congress, Assembled, appealing to the Supreme Judge of the world for the rectitude of our intentions, do, in the Name, and by Authority of the good People of these Colonies, solemnly publish and declare, That these United Colonies are, and of Right ought to be Free and Independent States; that they are Absolved from all Allegiance to the British Crown, and that all political connection between them and the State of Great Britain, is and ought to be totally dissolved; and that as Free and Independent States, they have full Power to levy War, conclude Peace, contract Alliances, establish Commerce, and to do all other Acts and Things which Independent States may of right do.

And for the support of this Declaration, with a firm reliance on the protection of divine Providence, we mutually pledge to each other our Lives, our Fortunes and our sacred Honor.