Lombardi, Exceptionalism, and the Rule of Law…

My niece texted me last weekend (while my favorite team beat the Dallas Cowboys), and asked me about my strong affinity for the Green Bay Packers.  Aside from my love for a perennial winner, and being raised on Packer lore by my father, since I was a toddler… there’s an economic aspect to The Team that I have always found intriguing.

The Green Bay Packers are a magnificent economic anachronism for two reasons.  First, how is it that a NFL franchise in the middle of virtually, nowhere is so highly successful?  The simple answer is that the NFL embodies the success of socialism, through a television revenue sharing arrangement among the teams.  And two, the team is owned by citizens of Green Bay, WI and the public, and charter rules prohibit any single party from obtaining majority ownership.  So here is a highly successful version of socialism, the NFL, dominated by a not-for-profit team, the Green Bay Packers.  And what makes the Packers so damn good...? 

Well, the Packers can afford to take the long view of the game and develop talent and strategy, versus every other privately held team in the NFL, who all too often take a quarterly statement view, a myopic view, of the sport.  That is to say, the for-profit strategy of every other team in the NFL is all too often dominated by dollars and cents, not necessarily on winning.

Of course, American socialism is not limited to the NFL.  There’s no greater champion of socialism in America than the Republican Party, who has been redistributing wealth in America to monopolies, cartels and the plutocracy for the last 35 years (via tax cuts for the rich, allowing the formation of monopolies and cartels, by weakening regulation, regulators, and allowing regulatory capture, via Wall Street bank bailouts, and through government privatization… just to name a few examples).  Not to mention we have a fourth branch of government, The Federal Reserve, that is completely dedicated to maximum bank welfare, and inflating asset bubbles (The Fed is the quintessential government gift to Wall Street banks, shadow banking, and private equity).

Just to be clear, “socialism” is putting the means of production into a single party’s hands.  Generally, as understood by most economist and political scientist, that single party is the government.  But when Republicans, and yes even GOP- Lite (Dems), place or gift the means of production for an entire industry - into the hands of one or a few private sector companies, in the creation of a monopoly or cartel – they are creating “socialism by private proxy.” 

If you think the Federal government sucks money out your pocket, think about the money private sector monopolies and cartels take from you daily.  Whether it be Big Pharma, Big Oil (imagine, a few short months ago the price of gas was double what you are presently paying at the pump), the Cable monopolies, or the airlines (just to name a few)…. Courtesy of the State, they are all taxing you to death, through monopolistic profits.

Which brings us to my final point, before we launch into today’s piece:

Are the Packers, perhaps one of the most successful teams in American football, a model for the future of capitalism, a capitalism that works for the many instead of an elite few?  Think about how the Packers operate… is it within reason that, someday, American citizens demand that local, state and federal governments purchase entire corporations, to be run for the public good (as not-for-profits), instead of for the enrichment of less than one percent of the population?  It's not really a stretch, is it?  Many large American businesses already enjoy government backstop and support, and losses are socialized... so why not socialize profits?  As job opportunities continue to decline, as a result of technology, globalization and private equity - the Packer model may become a serious option. 

If the Packers are the example… government purchase of private sector enterprise, to be run as not-for-profits, may be an enlightened option.  There’s a reason why the NFL has banned not-for-profits from owning any other NFL franchises.  The bottom line: The for-profit teams are having trouble handling the competition.  

- J.M.H.  (1-15-15)

Lombardi, Exceptionalism, and the Rule of Law…

By J.M. Hamilton   (originally published 2-3-11)         

"God, country, and the Green Bay Packers." Vince Lombardi, the greatest Italian export, since Antonio Vivaldi. 

Before there was AMC’s Mad Men, there was a true man of the sixties named Vince Lombardi.  One gets the feeling that Lombardi would have flossed his teeth with Mr. David Draper.  As hard as Lambeau field in January, Lombardi burned brightly throughout the sixties, and led the Green Bay Packers to win the first two Super Bowl games ever played.  His passion, dedication and commitment to the game of football made Lombardi a winner, and an American icon.  His name graces the Super Bowl trophy awarded to the championship team, year after year.  As with any genius he would drive some of his players “nuts,” and many others would have a “love/hate” relationship with the man, long after they stopped playing for the Packers, Giants or Redskins.  We get a snap shot of Lombardi by reading David Maraniss’ book, When Pride Still Mattered.  Note the following passage after the 1967 New Years Eve win over the Dallas Cowboys, in the fabled Ice Bowl:

“The Locker Room was a jangle of cameras and lights when Lombardi got there after the game.  He evicted the press and talked to his men alone, telling them how proud he was:  for running to win, for persevering and meeting their greatest challenge, winning three straight championships.  He barely stifled the tears that came so easily to him, then fell to his knees and led the team in the Lord’s Prayer.”

Now, by way of comparison, can you imagine Lloyd Blankfein, CEO of Goldman Sachs, dropping to his knees to lead a boardroom in prayer, after hitting quarterly financial targets?  Both men, Lombardi and Blankfein, are brilliant in their respective fields of football and banking, and both men are fully engaged, and extremely focused.  Both men are razors.  

But what makes one man loved and adored by many, while the other man is despised and reviled by many? I have thought about this question long and hard, and have concluded it is one thing: it is the rules that these respective men play by.

It is said that there is a thin line between madness and genius, and my guess is the dichotomy centers around whether or not society is the beneficiary of the singular individual’s talent and achievements, or whether it is the victim.  Robert Downey Jr., in the movie Rodney Dangerfield – Back to School, once identified football as a “crypto fascist metaphor for nuclear warfare.”  Now, I don’t believe Mr. Downey’s comedic line for a moment, but if football devolved, by a change in the rules, into some sort of barbaric blood sport during Mr. Lombardi’s time, complete with knives, guns, and collateral damage into the stands, than my guess is society would not view Mr. Lombardi and football in such a favorable light.   Conversely, the rules of banking have become so heinous and so detrimental to society, that the genius Blankfein is not viewed by many as a prince of a man, but rather, a villain.  Why?  Quite simply Mr. Blankfein’s reputation, and that of his Wall Street brethren, are victims of their own rules.

Take Dodd Frank bank reform legislation for instance.   These rules, on the heels of the worst banking crisis known to man, were stripped down and were basically written behind closed doors, in large part, by members of, or lobbyist for, the Wall Street banking cartel.  “Financial weapons of mass destruction,” Mr. Buffet’s phrase to describe derivatives and credit default swaps, remain, for the most part, beyond the reach of regulators, and hidden from public view.  These derivative instruments with hundreds of trillions in notional value played a very large role in our last global financial crisis, and undoubtedly will play an even larger role in the next financial crisis.  And the fatal flaw in Dodd Frank legislation?   Well, as usual our elected leaders in the Congress passed the buck.  Not only did they fail to give specifics on how the banks and these instruments were to be reined in (in fact they exempted the lion’s share of these derivative instruments from the rules themselves), but Congress abdicated their responsibility and punted to the regulators.  The very same regulators, who failed to rein in Wall Street’s worst excesses the last go around, that are prone to capture, and can change in the blink of the eye, with a change in administrations.   That’s right.  Even the best and most well intentioned ministrations of Obama regulatory appointees can be reversed with the pull of a voting booth lever, and a Republican president entering the White House.  Let us pray, not.

In short, Dodd- Frank is the bomb, and I’m not talking about a 50 yard aerial strike- pass play launched from the twenty yard line.

Perhaps Mr. Downey’s line would be less comedic, and certainly more accurate, had he stated:  Banking is a crypto fascist metaphor for nuclear warfare.  Indeed, Mr. Blankfein’s rule making appears, ultimately, to be to the detriment of society, business, the world, and ultimately to his reputation.  Unfortunately, the joke is on us.

And while we’re tilting at windmills this week, what about that other raging Leviathan, Exxon Mobil Corporation?  Here again, the rules of capitalism, and society, have been so distorted, so as to cause many Americans, particularly Republicans, to think that Exxon is a capitalist enterprise.  No, we hardly pay it a mind when they report out another record profits quarter.  Now when demand is down or flat, supply is up, and OPEC says they have plenty of capacity to fix prices (um, provide a stable environment for world energy consumption), how exactly does Exxon make record profits?   Well, that would be because they are, virtually, a government sanctioned monopoly, controlling significant amounts of market share.  And as this blog has written monopolies and oligopolies are authorized by the government and can be controlled by the government, that is when there is the political will to do so; and this blog has also argued that monopolies, as creations of the state, are nothing short of socialism by private proxy.  That’s right, you – dear consumer – are the beneficiary of an energy industry that is not dedicated to evolutionary energy policies away from the burning of fossil fuels; but rather, an energy industry dedicated to the global addiction of a product produced by Middle-East tyrants and dictators, and maximizing profit at your expense. 

No taxation (i.e. monopolistic profits) without Representation!  Here is yet another industry that writes its own rules in Congress, and not only captures the regulators, but drugs and has sex with them.  Witness B.P.’ gulf disaster last spring, and their pet poster-boy, Representative Joe Barton (Republican-Dallas); and prior to that, the capture, drugging and rape of the Minerals Management Service (Oh, I forgot, one can’t rape the willing!), supposed watch –dog for America and Americans.  Given that monopolies are creations of government, and socialism by private proxy, windfall profits, like those made by Exxon, constitute a tax on society.  But unlike the taxes levied by the government, where at the voting booth Americans have some say in the tax rate and distribution of government revenue, the American voter has absolutely no say in the price per gallon of gasoline, or the interest rate and terms of a bank loan they may receive.  And the problem the American consumer is faced with?  We now have several monopolies engaged in predatory pricing campaigns against the public so that America’s ever shrinking middle class has little or no discretionary spending for goods and services, beyond the basics: food, gas, and interest payments to the bank!  And we wonder why the alleged nascent recovery stalls whenever government stops spending stimulus money.  

Unemployment remains untenable.

Supply side theory/ Reaganomics, and the Laffer curve, an oft touted economic theory of the Republican Party, posit that tax revenue to the state actually diminishes at some progressive tax level.  So that by cutting marginal tax rates, economic activity is actually spurred by animal spirits, entrepreneurial initiative is charged, and as a result, a rising tide of business activity causes the economy to advance ten yards up the field, and government receipts to actually increase.   Democrats call this theory “trickle down.”  For the sake of the argument I’m about to make, I’m willing to give the theory some credit.  The problem with supply side economics is that both political parties are good at cutting taxes to drive the economy up the field, but neither party has the will or discipline to increase taxes once the economy has run across the goal line; hence our colossal national debt.  Witness the saga of the Bush tax cuts, over the last decade.  By the way, it has been argued that President Kennedy was the first supply-sider.

That said, and here’s my point, if Republicans believe that supply side theory actually works, why not apply the practice to monopolistic profits, or taxation by private proxy?  If the government was to truly rein in the likes of Big Oil and the banking industry by taxing, or regulating against, unseemly profits at the pump or by taxing the usurious interest banks charge (both are forms of taxation without representation), think about how much more discretionary income the middle class would have to spend on other goods and services?  If we believe Mr. Laffer and the Austrian school, the economy would certainly soar.  And let’s not forget rising fuel prices precipitated the financial collapse in 2008.

But if you believe the Republican Party is going to apply their economic golden-rule to the likes of Wall Street Banks or Big Oil than think again.  Public be damned, the institutions of Wall Street and Big Oil, flush with monopolistic taxation, fill election campaigns with money, and their mercenary lobbyist roam the halls of Congress, frequently and often.

If Big Oil and banks expect the government, and the public, to bail them out for their own disasters, whether it is gulf oil spills or financial crisis, might “the people” reasonably expect that their own government would protect them from monopolies worst pricing/taxation excesses?  After all, democratically elected government allowed for these monstrous combinations.  Unfortunately rule making, and the rule of law, has been hijacked by the plutocracy…. to the public's, business community’, and nation’s utter detriment.

History tells us that Coach Lombardi, a favorite of the business community, was both a Democrat and a friend to the Kennedy clan.  One wonders if Mr. Lombardi would have supported a windfall profits tax.

GO GREEN BAY!

 Copyright JM Hamilton Publishing 2015

The Great Economic Divergence…

The Great Economic Divergence…

(Bubble, bubble) toil and trouble;
    Fire burn, and caldron bubble. 

- From the play, Macbeth, by William Shakespeare

By J.M. Hamilton (1-1-2015)

With full apologies to the Immortal Bard… His line immediately came to mind recently, when thinking of the Federal Reserve (or Fed) and the American economy.  With slight modification, this witches’ incantation fits the times.  The witches I write of, of course, are from Macbeth, and these three wise women foretold of Macbeth’s rise, and eminent downfall.  The line fits because of the rise and fall of the American economy, caused by the Fed’s magic ability to create bubbles out of thin air, only to see mayhem and collapse ensue.   Again and again, like the rising and receding of the tide…. The Fed pumps up the financial side of the economy, the side based upon debt and finance, only to see it end badly for the majority of Americans, and in particular, Main Street.  

Will the Fed ever learn?   Will Wall Street banks, shadow banking, and private equity ever learn?

That’s exceptionally doubtful, since Wall Street is driven by greed and emotion, and profits are privatized, while losses and bailouts are socialized among the 99%. 

Where’s the incentive to learn? 

The Street, like Macbeth, is marked by recidivism.  And mandate aside, the Fed has one true master, and she answers to the Cartel.  It’s just one more way ordinary Americans get screwed daily; the populism of the times, and rising support for prospective Warren and Paul presidential candidacies, suggests that Americans are waking up to the many ways in which they are getting the shaft, by the Banking cartel, monopolies, The Fed, and our crony government.

For anybody who cares to know, you really don’t have to dig hard.  The business papers, and general news press, are full of story after story on how Americans are run over and backed over, frequently and often, not just by the Street but more amazingly, by some of the icons of American business.  The recent piece about Wal-Mart being ordered by two judges to pay back wages to workers, to the tune of $188 million, is a perfect example.  Seems that Wal-Mart withheld wages, and did not compensate for breaks (often not taken) … not unlike the allegations leveled against another Fortune 500 company, McDonalds.  The original ruling against Wal-Mart took place in 2007.  One can only hope sizable interest is accruing to the plaintiffs, as Wal-Mart continues to delay payment and play legal games.

What inspires the crème de la crème of American business to rip off their employees and the American consumer?  Somebody, somewhere, inside these organizations must be doing the cost/benefit analysis.  And well, as the saying goes: crime pays.  Crime pays particularly well, when both political parties are owned by The Business Roundtable, and The Chamber.  If you operate within a monopoly or cartel, the temptation must go up exponentially, since said enterprise faces no, or limited, competition.

Wage theft is everywhere these days, and it doesn’t even have to come from your employer.  (And to be sure, many companies are guilty of no intended vice at all.)  It seems, one can no longer purchase an item, commodity, basic staple, or service without running into some sort of monopoly, monopsony, cartel, duopoly, oligopoly, or criminal enterprise.  For examples of wage theft read here, here, here, here, here, and here again.

The unholy alliance between big business and our government has never been stronger (under a Democratic Administration, no less), and unseemly profits accrue, as Horatio Alger might have put it, to the “swiftest of foot, and the devil take the hind most.”  The pols, bought off, purchased, and co-opted, pass the legislation put forth by the attorneys for the various cartels.  Politicians from both political parties respond, dutifully.

State attorney generals for sale to the highest bidder. 

A SCOTUS that more resembles nine monarchs, is the plutocracies greatest friend. 

The U.S. is the only Western democracy that has not set limits on Big Pharma’s profits, and the industry responds in kind: with price gouging, shortages of critical medicines, and tax inversions.  The SEC, the FTC, Justice Department, Congress, and the Fed turn a blind eye.  Yup, it’s all good. 

It’s no accident that over the last 35 years – a period marked by a highly accommodative/”dovish” Fed policy (barring Mr. Volcker’s time in office) – a period also marred by the laissez faire ethos and increased government deregulation – that we have seen the rise of job killing M&A activity, an increase in the number of firms in the job killing private equity industry, and the worst financial crisis since the Great Depression.  And just to drive the point, “job killing,” or the reduction in the number of jobs, also directly equates to stagnating wages.

These are just some of the ways wage theft, macro and micro, occurs on a daily basis.  There are many more.

How ironic, that it was not the Fed’s exigent and “crucial” efforts at trickle down monetary policy that finally turned this economy around… some six years into the Great Recession, but rather, the collapse of the Energy cartel.  Greed once again, came knocking on the door of the oil patch, and the American consumer is the beneficiary.  There wasn’t enough offshore oil tankers, barges, and on-shore oil storage facilities for the Koch Bros., Goldman $achs, KKR, and Exxon to store the surfeit of oil and gas.  The stock market responded in kind, with the start of a correction… that is before the Fed, once again, stepped into the breach, and assured the Lords of Finance and the Mavens of Financial Engineering that the free money for the 1% would continue, unabated.

How is it that a terrific business fundamental, like cheap and abundant energy, could be looked down upon by the Street and the stock market?  (And how is it that the business fundamentals in this country have been lame for six years, but the stock market soared anyway?)  If you read J.M.H., the answer is summed up in two words: The Fed.

Inexpensive energy – like a living wage, like inexpensive medicine, like the demise of all monopolies and cartels, and a fair and progressive tax code – means more money for the 99% to spend, and greater aggregate demand.  All positive characteristics for a robust economy, right? 

Except, these characteristics are not necessarily beneficial to the elite/1% (at least not in the short run), who have been calling the shots in this Neo-Gilded Age for some time now.  And the elite, and their apologists, are used to having their way.

We are witnessing a great economic divergence between the interests of the 1% and the 99%; a divergence of economic interests not seen between the classes, since the last Gilded Age.  Where anything that threatens: the chokehold monopolies and cartels exercise over the American consumer, short term monopolistic profits, wage theft, financial engineering, the flow of easy money from the Fed, boom/bust cycles, regulatory capture, and tax avoidance… is considered by the Street and the stock market to be bad. 

And anything that is good for employees and consumers (i.e. aggregate demand), who drive the economy:  like the break up of cartels and monopolies, mitigation of short term profit making potential in exchange for a long term glide path to prosperity for all, a living wage, the end of easy money and financial engineering (encouraged by the Fed’s policies) – so that enterprise can focus on their core business - and a progressive distribution of the tax burden… is also considered bad by the Street.  Nearly everybody – including many economists – acknowledges: what puts more money in workers/consumers pockets is good for the long-term health of the economy, aggregate demand, top line growth, Main Street businesses, job opportunities, and the American people.  And yes, in the long run, these factors are good even for the economic elite.

In short, the interests of the plutocracy/Wall Street and the 99% do not align.  Since the U.S. government is the only countervailing power that can hold the plutocracy in check, and set the rules of the road for a healthy American economy, there is also a great political divergence.  Hence, thanks to SCOTUS, the plutocracies highly successful efforts to purchase and own our state and federal governments.

Much of this sense of entitlement, and economic and political divergence, is fueled by the easy money policies of the Grand Enabler, the Federal Reserve.

John D. Rockefeller founded Standard Oil.  Recently, his heirs divested all fossil fuel interests.  Prescient?

So where’s the next bubble to come from?  Take your pick:  sovereign debt, junk bonds, sub-prime auto loans, the stock market, a debt crash in the oil/gas fields, or perhaps it’s from the hundreds of trillions in uncollateralized derivative and swaps products?  Your guess is as good as mine.  Although it’s highly probable that when one bubble bursts, it’s likely to set off a cascade of additional corrections.  The Fed’s history is haunted by such calamities, like Banquo’s ghost, inconveniently, visiting Macbeth at a most inopportune time.  None of the lessons from the ’08 financial crisis have been learned, which sets us up to repeat history, yet again.  We can largely thank Treasury, regulatory capture, a feckless Congress, and the Fed for that.  Many key reforms have been undone, and the Fed’s bubble policies continue unabated.

Let’s look at three recent examples:

·      Passed in the Crime-nibus, sorry meant CRomnibus, spending measure this December, was the provision placing the taxpayer back on the hook for the hundreds of trillions in swaps and derivatives.  Thank Mr. Jamie Dimon, the fine folks at Citigroup, Cartel lobbyist, and our U.S. Congress for this crime.  Given the bubble economy we are now in – debt being a key bubble - the banking cartel’s timing is impeccable.  Swaps and derivative products – reinsured by the American taxpayer - are used to insure debt, bonds, and bet against same.  There’s that “socialization of Wall Street losses” thing, many pundits keep writing about and Senator Elizabeth Warren has been warning us against.  Oh, and Citigroup... well they're expanding, not curtailing, their gambling operations.

·      The Volcker Rule was delayed by our beloved Fed for years to come (maybe even decades), allowing the federally insured banking cartel to continue to gamble with U.S. taxpayer money (in highly illiquid and long term business transactions, like private equity deals). 

·      And speaking of our private equity (PE) buddies… seems that our friends, Apollo and KKR, went long on the recent gold rush into oil and gas.  Of course, PE is fueled by the easy money policies of the FED, and naïve investors chasing record low junk debt yields (i.e. very little reward for a great deal of risk).  This same crew, PE, is responsible for another ill-timed investment, and the largest private equity bankruptcy in history, Energy Future Holdings or TXU.  Under the crushing pressure of a PE LBO, Energy Future Holdings (TXU) went bust in 2014.  Just ask Mr. Warren Buffett.

The Fed sure likes to keep it interesting.

Perhaps too interesting.  The power of the Federal Reserve is perhaps unmatched by any other branch of government; and yet, its tools are incredibly blunt and crude, and often deployed with many unintended consequences.  We like to talk about the three branches of U.S. government, but really there are four, including the Fed.  The heads of two of these four branches, SCOTUS and the Fed, are not subject to popular vote, nor are they subject to term limits.  

Seems that such powerful institutions, like the Fed and SCOTUS, should be more open, transparent, subject to term limits, and its members elected by popular vote.  There was a time in this country, when U.S. Senators were not subject to popular vote, but rather were elected by the pols/cronies, who made up our state legislatures.  Then, 1913 rolled around and the Seventeenth Amendment was passed, which put an end to the practice and made U.S. Senators subject to the electorate’s will. 

See, miracles do happen.  Not surprisingly, Progressives championed the 17th Amendment, while Republicans and the first Gilded Age's trusts/monopolists fought the amendment.

One doesn’t have to be a witch, or be able to foretell the future, to know that the Fed appears to have supplanted its dual mandate of maximum employment and low inflation, with maximum welfare for Wall Street and highly inflated asset bubbles.  (As a historical digression, it’s interesting to note, given the Fed’s bipolar explicit and tacit mandates, that the blue prints for the Fed were drawn up by the Wall Street cartel on Jekyll Island, GA, and that the Fed was sold to the Congress in the early 20th Century, as a means to eliminate boom/bust cycles in the economy.)  A movement towards the democratization of the Fed and of SCOTUS, term limits for all government officials (especially judges), caps on campaign contributions and the time allotted for political campaigns, and the start up of presidential election campaigns headed by common sense/populist leadership, from both political parties…. All would be a great start for 2015. 

Hey, one can dream, and we know miracles can and do happen.  Another burst bubble, and another catastrophic financial crisis, may move this country one step closer to these much-needed reforms.  I’m not smart enough to pick the day or the time of such an event (nor am I wishing such an event upon us), but smarter individuals than myself have already been quoted as stating that the next financial crisis is "inevitable."  Given the Fed’s track record, such an calamity is almost guaranteed.

And while we are compiling our 2015 wish list…. Let’s not forget: Placing limits on the true power brokers, the plutocracy, by seeing President Obama use the awesome powers of the federal government to break up monopolies and cartels.  The President has been on a roll lately, with unilateral action on immigration, renewed ties to Cuba, and finally, pulling out of Afghanistan.  The President’s poll numbers are rising.  Maybe he can spend some of his new found political capital, by saying “NO” to monopolies and cartels and the formation of same?

Who knows, with such an act, perhaps President Obama’s poll numbers and approval rating will continue to rise?  After all, what is good for the Street and the stock market is not necessarily good for Americans, businesses, investors, and the American economy.

P.S.   A very Happy New Year.

Copyright JM Hamilton Publishing 2015

No Virginia, There is no Santa Claus…

No Virginia, There is no Santa Claus… but better still, there is a Senator Elizabeth Warren.

With gratitude to Virginia O’Hanlon, and The Sun… J.M. Hamilton (12-20-14)

Dear Editor, I am 8 years old.

Some of my little friends say there is no Santa Claus.

Papa says, “If you see it in The Sun, it’s so.”

Please tell me the truth, is there a Santa Claus?

Virginia O’Hanlon

115 W. 95th St.

 

Virginia O’Hanlon, a real girl, wrote a real letter.

Virginia, your little friends, the plutocracy, are wrong. They have been affected by the skepticism of a skeptical age. The political elite do not believe except what can be denominated in campaign contributions. The economic and political elite think that nothing can be which is not comprehensible by their little minds. All minds, Virginia, whether they be corrupt politicians or monopolist, are little. In this great universe of ours man is a mere insect, an ant, in his intellect, as compared with the boundless world about him, as measured by the intelligence capable of grasping the whole truth and knowledge.

No, Virginia, there is no Santa Claus, but better still, there is a Senator Elizabeth Warren.  The Senator exists as certainly as love and generosity and devotion exist, and you know that they abound and give to your life its highest beauty and joy. Alas! How dreary would be the world if there were no Senator Warren! It would be as dreary as if there were no Virginias. There would be no faith in the political process, no populism, no democratic means to make tolerable this unjust existence. We should have no enjoyment, except in the material. The eternal light with which childhood fills the world would be extinguished.

Not believe that Senator Warren will run for President! You might as well not believe in PACs, 501(c), grass roots movements, or the power of social media! You might get your papa to hire men to watch Massachusetts on Christmas Eve to find Senator Warren, but even if they did not see Senator Warren railing against Wall Street, what would that prove? Nobody sees HOPE that there will be a President Warren, but that is no sign that there will not be a President Warren. The most real things in the world are those that neither children nor men can see. Did you ever see robber barons dancing on the lawn? Of course not, but that’s no proof that they are not there. Nobody can conceive or imagine all the wonders that are unseen and unseeable in the world.

You tear apart the Wall Street cartel and see what makes the noise inside, but there is a veil covering the unseen world which not the strongest military, nor even the united strength of the military industrial and intelligence complex could tear apart. Only faith, fancy, poetry, love, romance can push aside that curtain and view future President Warren’s super natural beauty and glory beyond. Is it all real? Ah, Virginia, in all this world there is nothing else real and abiding.

No President Warren! Thank God she lives and her fight lives forever. A thousand years from now, Virginia, nay 10 times 10 thousand years from now, Senator Warren’s words will continue to make glad the heart of humankind.

Copyright JM Hamilton Publishing 2014

Why Serve?

Why Serve?

Kissinger: In my life, I have almost always been on the side of active foreign policy. But you need to know with whom you are cooperating. You need reliable partners -- and I don't see any in this conflict (Syria).

Kissinger: I have learned, as I wrote, that history must be discovered, not declared. It's an admission that one grows in life. It's not necessarily a self-criticism. What I was trying to say is you should not think that you can shape history only by your will. This is also why I'm against the concept of intervention when you don't know its ultimate implications.

Kissinger: I'll tell you what I thought at the time. I thought that after the attack on the United States, it was important that the US vindicate its position. The UN had certified major violations. So I thought that overthrowing Saddam was a legitimate objective. I thought it was unrealistic to attempt to bring about democracy by military occupation.

SPIEGEL: Why are you so sure that it is unrealistic?

Kissinger: Unless you are willing to do it for decades and you are certain your people will follow you. But it is probably beyond the resources of any one country.

Spiegel Online - International  11-13-14

By J.M. Hamilton (12-12-14)

In 1988, Governor Michael Dukakis (MA – D) lost his presidential election to George H.W. Bush, largely, due to the perception that he was soft on crime.  This ushered in a period where a fear mongering GOP attempted to label every Democrat as “soft on crime.”  The Democratic Party, rather than sticking to its principles on appropriate and impartial sentencing (many Dems objected to the death penalty), rushed – in a game of political one-upmanship – alongside the GOP - to build the criminal justice industrial complex.

Today, nearly forty years later, most Democrats, and more than a few Republicans, recognize President Reagan’s federal mandatory sentencing guidelines, the criminal justice industrial complex, the steady privatization of our prison system, and the militarization of our local and state police agencies for what they are: a complete and unmitigated disaster. 

A national disaster that is a threat to the rule of law; that has led to the highest incarceration rate in the developed world (totalitarian China has a lower incarceration rate than the U.S.); has had the pernicious effect of disenfranchising minority voters; incarcerated and ruined the lives of many young citizens and persons of color for victimless crimes, like drug possession; and has led to the complete melt down of race relations and police and societal relations in our country.  Forty years – two generations - is a long time for both political parties to figure out that their “get tough” moves on crime were intolerant, a waste of taxpayer resources and human lives, and worse still, completely racist.

Today, the Democratic Party (or GOP-Lite), led by President Obama, appears ready to repeat a similar mistake.  The Democratic Party appears all too ready to begin following a fear mongering GOP, once again, down the rabbit hole of foreign policy and by ignoring President Washington’s admonishment:  to beware of foreign entanglements.

The result of the GOP’s blind over-reach, globally, has been failed wars in Iraq and Afghanistan.  Like Vietnam before it, Afghanistan and Iraq nation building has wasted hundreds of billions in taxpayer dollars, led the Federal Reserve to print trillions of dollars to pick up the tab, and caused record amounts of suicide among our fighting men and women; and above all, Iraq and Afghanistan have proven once again, that indigenous people (governed by corrupt puppet regimes), who are unwilling to fight for their own freedom, will not fill the vacuum – when American forces depart.  Hence, leaving a disaster in the making, nearly every time America reaches for the DOD for nation building purposes.

Now our President, who many of us support, and who campaigned on a pledge to pull the U.S. out of two failed GOP led wars, Iraq and Afghanistan – quite possibly in a duel of political one- upmanship, yet again – is doubling down and leading this nation to war. 

Sound familiar? 

POTUS has started up fresh wars in Iraq and Syria, and appears to be backtracking on winding down the Afghanistan nation building exercise.  (The President has also steadily back peddled on his pledge not to place boots on the ground in Iraq and Syria.)  Per departing Defense Secretary, Mr. Hagel, local Afghanistan forces – after more than a decade of U.S. occupation – need more time to get their act together.  Good luck with that.

Question:  Thirty to forty years from now, will a future generation of Americans and both political parties wake up from our national nightmare of foreign adventures to recognize – like the building of the criminal justice industrial complex – that it was all an epic waste of lives and resources?  Foreign adventures that were, and are, a monumental waste of taxpayer money, little more than a boondoggle for the military industrial complex, war profiteering defense contractors and multinationals, and a complete waste and ruin of the lives of the men and women who proudly serve this nation (and a disaster for the indigenous peoples we allegedly, went in to protect, and bring hope and democracy to)?

And the U.S. can place the forty-year old war on drugs right up there in the pantheon of ineptitude as well.  It’s a war that should have never been waged.

To that end, the point of today’s piece:  Why serve?  Or more specifically, why serve in our nation’s armed forces?

Culturally, it’s no accident that Hollywood continues to glorify WWII with new movies, but films portraying Afghanistan and various Iraqi conflicts often take on a more ominous tone, or are morally ambiguous (more akin to Vietnam movies), and with good reason.  When one compares the costs of the lightning raid by Special Forces on OBL’s compound, versus the trillions spent, and the hundreds of thousands of lives wasted on the two nation building exercises (designed to eliminate a similar or the same threat)… well the cost/benefit analysis doesn’t add up.  There is no comparison.  The abuse of the men and women who serve doesn’t stop there, however.

Not only are our soldiers poorly paid while serving, but upon returning home, many are forsaken by their country, cast off as refuse, with poor employment prospects, and worse health care (as illustrated by the recent scandals that rocked the V.A.)  An inordinate amount of the men who serve their country end up homeless, suffering from PTSD.

How about the circumstances that placed these men and women into harms way to begin with?  It’s well documented that America has been led into war, time and time again, through misinformation, falsehood, and contrived and slanted data.  The true motive for Iraq was the ocean of oil it contains – a resource that is now in abundant supply within the United States. 

As for the politicians, who are all too eager to send our troops into battle?  Unlike previous generations, the majority of the members of today’s U.S. Congress have never seen a battlefield, let alone served.  And as there is no draft, it is highly unlikely that their sons or daughters would ever be placed in harms way.  As taxes are no longer raised to pay for wars (wars are now financed), and there is no draft, the general public rarely offers focused, or sustained, disapproval of U.S. war efforts, no matter how badly mismanaged.  And that is by design.  The corporate run news media flashes a couple of beheadings on the nightly news, and our martial response is often exponentially disproportionate, poorly calibrated, and with little thought given to the repercussions or unintended consequences.   

It gets worse still, because thanks to SCOTUS’ Citizens United and McCutcheon decisions, arguably, the Congress and the Executive branch – in no small way – are compromised into doing the plutocracy’s bidding on foreign policy matters.  This means the true power brokers in America, the plutocracy (the Business Roundtable, the Chamber of Commerce, Wall Street, and Private Equity barons) call the shots, and the Congress is all too happy execute their requests.   The fact that the nation, as some have argued, went into Iraq, so that Mr. Cheney’s Halliburton could start up operations in the region, is a terrible reason to fight a war. 

How many of the nation’s youth were led into joining the war effort, post 9-11, with the best of patriotic intentions, when the reality was they were not fighting for democracy and America, but rather were fighting so that Exxon Mobil could begin sucking up Iraqi oil?  Do we really want our nation’s fighting force dying and killing for the Royal House of Saud, Qatar, or so that Exxon can make an extra billion on its next quarterly statement? 

What have our rulers, the plutocracy, done to demand such blind allegiance from our armed forces and our citizens?  The U.S. economic power elite have shipped jobs offshore in record numbers, through free trade agreements, outsourcing, and globalization.  As noted in Barron’s: through M&A, bankruptcies, and private equity, the plutocracy has cut down the number of publicly traded companies from 8,823 in 1997 to 5,008 at the end of 2013.  This industrial and service sector consolidation -  killed jobs and opportunity - has made the rich wealthier, caused gross wealth and wage inequality, led to stagnating wages, harmed the economy and the tax base, and led to monopolies and cartels (that produce a predatory tax on society, and a drag on the economy through monopolistic profits).  Worse still, the power elite are now fleeing the country, that has long protected them and their assets, in the latest tax dodge called inversions.  How’s that for instilling loyalty and trust?

Perhaps contributing most to foreign policy chaos, is the military industrial complex or MIC.  The revolving door between private defense contractors and the armed forces’ generals and officer staff is ceaselessly spinning.   This means we have an organization (the DOD) that is a dedicated advocate for war to resolve all the nation’s problems, both foreign and domestic.  Don’t understand something, don’t like some foreign head of state or some regime, is a dictator nationalizing domestic resources, is the U.S. economy stagnating, need a distraction from political stalemate and the ineffectiveness of our government to solve problems….   forget about an exit strategy, and unintended consequences be damned: WAVE THE FLAG AND BOMB IT, ALREADY!

It’s the GOP way.  And rapidly becoming the Democratic way, where the end always justifies the means.  That’s precisely the problem with these wars: the means and the process, unlimited war, has become the end unto itself.

Make no mistake about it, we should all cherish and honor the men and women who serve this country.  We can strongly disagree with the military missions our economic and political leaders send our armed forces on, but the men and women in uniform have no choice but to execute upon their orders.  My grandfather served in WWII, within the European theatre, and my father served in the U.S.A.F. for thirty-five years, during the height of the cold war.  I have a strong appreciation and a sense of gratitude for what these men and women do everyday, and the sacrifices their families make for our nation.  While our nation’s history is rich with battles and wars fought for righteous and moral causes, recent conflicts and nation building exercises do not reflect well upon our economic and political leadership, nor our nation.  In fact, they make us look morally bankrupt, and are financially, bankrupting the nation.

In nearly all instances where our military was deployed from Vietnam to Syria, the U.S. had made the situation worse, while facing no existential threat to our national security.  In fact, it is the wars themselves and the resulting blowback, that have created a threat to our national security: by creating deficit spending, by over-extending our military on missions it is ill suited for, and by abusing the men and women who serve.  Dr. Kissinger is 100% correct, and as J.M.H. has previously argued: nation building should be conducted by an international body, not solely the U.S. military.

Record poppy production in Afghanistan under U.S. watch, notwithstanding.  Torture conducted by the CIA as a matter of routine, like brushing your teeth in the morning.  An intelligence community (FBI, CIA, NSA, etc., etc., etc) that has run completely off the rails, violated the nation’s civil liberties and due process, created a police/surveillance state, and that is beyond the reach of any reasonable controls or guidance.  These are just a few examples of where the DOD and the intelligence community are entirely out of control, and conducting their affairs in a morally and logically unconscionable manner.

Some fifty odd years ago, in his farewell address to the nation, the greatest General who ever lived, President Eisenhower, called it:

“We cannot mortgage the material assets of our grandchildren without asking the loss also of their political and spiritual heritage. We want democracy to survive for all generations to come, not to become the insolvent phantom of tomorrow.”

As such, and in this current environment, I would be very hard pressed to recommend to my son that he serve in the armed forces.  Instead, if he wanted to serve his country, I would recommend that he join the peace corps.

President Obama, in 2008, campaigned on a desire to end two failed nation building exercises.  And the American people, wisely, supported the President in that regard.  What should have come as a surprise to no one was that these two wars, like Vietnam before them, would come to a very bad end (just as I predicted in 2010 in my piece, No More Afghanistans).  No less surprising is that the GOP, who brought these circumstances upon the nation, would attempt to hang their foreseen failure upon the current White House occupant.  But shame on the great communicator, President Obama, for forgetting to mention to the American people, the highly probable collapse of a corrupt and unstable Iraqi regime.

More recently President Obama characterized his foreign policy as not doing “stupid stuff” (which this blog has applauded), but how smart was it to go into Syria to fight a force, ISIL, that has no nukes, no air force, and no weapons of mass destruction?  (Or was it just politically expedient for the President, and necessary to create the greatest opportunity for Hillary’s coronation?)  Moreover, the beneficiaries of our martial efforts in the region appear to be Big Oil companies (Halliburton, Exxon, et al.), Iran, various oil rich Arab monarchies, and Assad, the Syrian dictator.  Secretary of State John Kerry, who once asked how can we ask our soldiers to “die for a mistake” called Vietnam, now is the biggest cheerleader for the latest Iraqi/Syrian war.  As for the rogue states who played no small part in the formation of ISIL, The Royal House of Saud and Qatar…. As usual, the U.S. is addressing the symptom (ISIL) and not the problem, our so-called allies (Saudi Arabia and Qatar).

Until there is campaign finance reform in this country – coupled with term limits, extravagant sums of money are divorced from the political process, and until the DOD and Intelligence agencies are brought under control, there should be a moratorium on any and all wars, unless the U.S. and its territories are invaded.  Our nation’s warriors are fighting and dying in foreign lands for a lie, for major corporations, and to enrich DOD contractors.  And so that politicians, beating the fear drum, can be reelected.

Americans now realize that our criminal justice and judicial system is an abomination…. How many lives must be wasted, and trillions burned through by the DOD, before we recognize our foreign policy for what it is, a complete disaster?

Time for some fresh blood and some new thinking is this regard; time for Senators Warren and Paul to run for higher office.

 

P.S.

J.M.H. has been writing about monopolies and cartels for a few years now, calling them an unholy alliance between government and the private sector.  Crony capitalism at its worst, monopolies feed upon the consumer, kill jobs and opportunity, stifle innovation, and are a tax upon society, through monopolistic profits.  And at long last much of what I have written has played out before our eyes in real time, with the collapse of Big Oil and OPEC.  You want to stimulate the economy and create jobs (forget about the FED), expand the tax base, and eliminate the Federal debt… politicians take note…. Kill monopolies, oligopolies, monopsonies, and cartels.

There’s no greater stimulus under the sun, and no greater preserver of capitalism's best attributes.

Copyright JM Hamilton Publishing 2014