The GOP’s Love Affair with the Nanny State!

The GOP’s Love Affair with the Nanny State!

 

“If a free society cannot help the many who are poor, it cannot save the few who are rich.”

- John F. Kennedy

 

“If those of us in positions of responsibility fail to do everything in our power to protect the right of privacy, we risk something far more valuable than money. We risk our way of life.”

- Tim Cook, Apple CEO

By J.M. Hamilton (2-14-15)

Nothing ticks off libertarians, or some on the political right, quite like the nanny state. The “nanny state” is best defined as the government infringing upon personal liberties to achieve, sometimes allegedly and speciously, some greater societal good. The goal of nanny state laws and programs, in a policy of preemption, may also be aimed at curtailing future pubic spending to remedy a known evil.

Perhaps no single politician better exemplifies the nanny state for Republicans, than former Mayor Michael Bloomberg, who once attempted to enforce an ordinance governing NY city soft drink consumption. The logic was simple: soft drinks are bad for your health; citizens cannot be counted on to make prudent decisions in regards their health (as evidenced by a national obesity epidemic); fatty snacks and soft drinks cause taxpayers to spend inordinate sums of public money to fight obesity related illness, like diabetes, through Medicare and Medicaid; and therefore, the state will enforce high fructose corn syrup consumption limits, and assorted fizzy drink caps.

Mayor Bloomberg is a billionaire, a bit of a political chameleon (having registered as a Republican, Democrat, and an independent), and among his many endeavors owns and operates one of the finest news organizations in the country, Bloomberg Business and Bloomberg Surveillance, et al.

In the interest of full disclosure, I often thought over the years that Mr. Bloomberg might have made a fine U.S. President, but some of his actions and proposals made many do a double-take. His latest proposal, which he shared very recently at the Aspen Institute, is the idea that guns should be taken away from minorities. The logic again, centers around pubic health, to wit: guns are a public health hazard; minorities suffer disproportionately and immensely from gun violence; gun violence costs the taxpayer cash through maintenance of police forces, hospital visits, and the resulting funding of the criminal justice industrial complex; and therefore, there ought to be legislation, or hegemonic executive power, leaving minorities unarmed.

Allison Joyce/Getty Images

Taking Mr. Bloomberg’s proposal to its logical extreme: only one tenth of one percent of the population, the plutocracy, should be allowed to own guns, since the wretched masses can’t handle such an awesome responsibility. To be sure, don’t put me down as either a gun fanatic, or even a gun enthusiast, but perhaps the very well intentioned Mr. Bloomberg may have crossed the Rubicon, or jumped the shark, into a zone that some might label “racist.” (I am certainly not calling the former Mayor racist, but some might say his proposal borders upon it.)  Perhaps the Mayor would be better served had he stuck to baby steps, such as a universal ban on all assault rifles and semi-automatics (regardless of race, religious or political affiliation, class or socio-economic status, etc.).

But I digress, because Mayor Bloomberg is not the point of this piece, he’s just a highly convenient example of the nanny state in action.

Like I said, the political right, in this country, often decries the immensity and power of federal and state governments (and in particular, its taxing authority), and its perceived infringement upon freedoms...except... well.... when it fits their agenda.

“Why J.M.H... what the hell are you talking about? Why everybody knows the Republican Party defines freedom and personal liberty, and wouldn’t dream of using the state to enforce its agenda.  Or subjugate through the law, and the power of the state, persons with various and alternative beliefs, skin tones, sexual preferences, or political affiliations, etc. Nor would the GOP use the taxing power of the state to redistribute wealth to GOP supporters, and Republican nanny/pet projects. Wake up, the GOP is equanimity defined.”

Really?

Let’s look at some examples of where the GOP uses the state, the nanny state (and its taxing authority), to enforce its agenda under specious claims of greater societal good.

1) The DoD. Ironic isn’t it? The GOP used to be the political party that heeded our founding father’s warnings, beware of foreign entanglements. Our political leadership used to have to drag this nation, kicking and screaming, into war. Today, the GOP is the first one to reach for the DoD, for any issue that arises globally. The fact that the GOP encourages the use of force for events that don’t concern this country and are not a threat to our national security, strikes me as shear madness. The simple solution for the GOP, the easy call, always: bombs away. Even after losing Vietnam, Iraq and Afghanistan... with the credibility and morale of our abused armed forces at low ebb, the GOP still believes the military is one stop shopping for all our foreign policy needs. The fact that the aforementioned wars were completely unnecessary (in fact, the resulting blowback is even more of a threat), appears to be a lesson the GOP, and yes, Dems, is unwilling to learn.

2) The Surveillance State (NSA, FBI, CIA, etc, etc.) Half the nation's discretionary federal spending goes to defense and surveillance; a great deal of that spending is off line, within black budgets, or classified, so who knows how much the U.S. really spends on offense and surveillance. And despite having our freedoms and civil liberties stripped from us daily, all in the name of greater personal safety, why has the world become more dangerous? George Orwell and Phillip K. Dick dreamed it up, and the GOP and the NSA adopted their vision, mixed in totalitarian Stasi tactics, and ran with it. Of course, I am writing of the police/surveillance state. With your every word listened to, with your every computer key stroke recorded... does it get any more “nanny” than this? And don’t forget, as taxpayers, we’re paying to have the state violate our civil liberties and freedoms. The bottom line: the U.S. could defend this nation for a lot less than we are presently paying, but the cost to defend the plutocracy’s global commercial empire is very expensive, and the plutocracy is unwilling to pay.  That means you foot the bill.

3) The GOP, with a nod to faux Christian values, loves to legislate morality. That Christ admonished us not to judge others, and to love our neighbors as ourselves, seems completely lost on the GOP and the Religious right. Christ must be quite upset because over the years, the religion he founded has been used to rationalize all sorts of bigotry and hatred, whether it be Jim Crow, persecution of homosexuals and alternative faiths, or infringing upon women’s health and reproductive rights. The simple solution for the GOP, and the religious right is on full display: if you find a behavior, belief, or practice that is unacceptable to your version of "Christian morality" (say homosexuality or abortion), than don’t engage in it. Last I checked Christians are no longer being fed to the lions; quite the contrary, they are more likely to be dictating GOP social policy (not unlike the Taliban in Afghanistan).

4) The War on Drugs. Inaugurated by Richard Nixon, the War on Drugs is over 40 years old and an absolute failure. More advanced countries have legalized drug consumption, long thought to be illicit in this country, and afford treatment - instead of jail time - to addicts. That drug consumption often tapers off, once the product is made legal doesn’t fit into the nanny state narrative; that more people die from tobacco and alcohol annually than all the illegal drugs combined appears lost upon supporters of this forty-plus year old war; that one of the most powerful opponents of Florida’s recent marijuana legalization effort was a Republican casino magnate and billionaire, who peddles all sorts of addiction(s) within his facilities, should surprise no one. This particular issue accomplishes so many of the GOP’s nanny state goals: the war on drugs feeds the MIC and the Surveillance State; it supports the demagogues of a false Christian morality; and further buttresses the next GOP nanny state favorite....

5) The Criminal Justice Industrial Complex (CJIC). For the last thirty-five years, nothing quite excites the GOP and their supporters, like law and order issues, capital punishment, and swift and often aborted justice. That this drive has been perverted to lock up minorities in disproportionate numbers, take away their voting rights, and that the U.S. locks up a higher proportion of its citizens than any other Western democracy....seems to suggest that the GOP’s true CJIC nanny state goal is Jim Crow maintenance and support.

Bit awkward isn’t it? The GOP despises big government liberals, public works projects, run-away government handouts, and a bloated “borrow/tax and spend” government that has run completely off the rails. But their shouts of derision ring hollow, when we find that Republicans have completely fallen in love with the nanny state.

Makes Senator Rand Paul look pretty damn moderate, among GOP candidates, doesn’t it?  Mr. Paul has taken some hits recently, (some of it justified), but he looks positively sane, compared to the field of GOP POTUS candidates.  (I'm always amazed: 
An insane Caucasian can walk into a Connecticut elementary school and kills two-dozen children and teachers, and the nation shrugs.  An all too common occurrence. But one Arab cuts off the head of one U.S. journalist in Syria, and the entire GOP establishment wants to bring the full weight of the U.S. armed forces down upon a nation that is no more a national security threat to the continental U.S. than the State of Alaska.  The GOP is essentially doing the terrorist bidding, by bankrupting the nation in another useless war.)

Separately, and on a combined basis, these nanny state policies present a threat to human dignity, life, liberty, and the fiscal health of our nation (and arguably, our national security). Hitting a particularly singular issue that the GOP holds dear: the Republican party’s nanny state robs citizens and taxpayers of their personal property, and hard earned income to support their failed policies. Worse still, the nation is in hock over the GOP‘s nanny state.

And what’s the common thread that runs through all these GOP pet institutions? It’s simple really.  Whether it be the DoD, the war on drugs, or the criminal justice industrial complex, the common denominator is this: much of these government operations have been privatized and are now profited from. Which basically, means it will be nearly impossible - no matter how wrong, insidious or wasteful - to shut these government programs down.

You think its hard to roll back government? Subcontract out a government function to a private contractor, and no matter how morally repugnant or wasteful, that government function becomes “indispensable.”

You see, the GOP hates big government, except when its pals are profiting from it, and kicking back campaign contributions their way.

To be sure the Dems are not exactly innocent in their backing of many of the aforementioned institutions; but there appears to be a key dichotomy, between the nanny state policies of the two respective political parties. The GOP views the nanny state as something to profit from, while the Dems take a more humanist tact, and view the nanny state as something to help their fellow citizens by, to the level the playing field by, and to lend a hand up.

The GOP hates Social Security, Medicaid and Medicare, and Romneycare, which have become the foundation of our Capitalist system... for these very institutions keep the pitchforks and the revolution at bay.

P.S.

Put down the remote.  Drop the video game… stop staring at your cell phone, because the world has a far more interesting story.  This story has everything:  economics, politics, greed, avarice, intrigue, nation state feuds, banksters, a currency on the brink, radicals, revolutionaries, and the elite and reactionaries.   And, ultimately, it’s a love story.

All eyes on Greece!

Copyright JM Hamilton Publishing 2015

The time and place for nation building is now, and right here at home, in America.

NO MORE AFGHANISTANS

Those who do not learn from history will not survive!  Afghanistan: The very definition of "insanity."

By J.M. Hamilton (Originally Published 7-31-2010)

This week’s editorial was going to address our soaring debt to GDP ratios and the political party that is largely responsible, the Republicans; but there is much time, an ever growing cascade of bad news to exploit in that endeavor, and the political season in on the horizon, so we’ll save that gem for later.

 

Instead, we depart from economic matters and discuss something very close to my heart: foreign policy and in particular, the war in Afghanistan.  It appears that things are not going so well in Afghanistan, not as well anyway, as we had been led to believe.  In fact, if we compare this war with another war without end that the U.S. was engaged in forty to fifty years ago, the parallels are remarkably similar, almost frightening.  And while the outcome of the Afghanistan war is not preordained, we can almost predict the outcome, if the prior war is any example:  a mighty superpower proclaiming victory but severely humbled, walking off the world stage, and learning, hopefully (for a generation anyway), the limits of military power.  For war, as Mr. Clausewitz has told us, is an extension of politics, and therefore, war is not a means to an end.  It is but a tool in our political arsenal.

The problem with our present war, like the war the U.S. was engaged in some forty years ago, is that the U.S. is using conventional forces to fight a guerilla insurgency.   Like the war in Indochina, the benefactor of the insurgency against the U.S. is a nuclear power(s); and while the indigenous populations in both wars disliked the guerilla forces, they grew to have an even greater disdain for U.S. military operations over time.  This week saw the release of a substantial body of secret military information in the form of the Wikileaks documents, illustrating that the American people have been deceived about the realities of the Afghan war.  And like the papers released this week, the New York Times published similar documents in the form of the “Pentagon Papers” in 1971, revealing the same information about that war.  Meanwhile, the American people’s appetite for the war in Afghanistan is eroding over time, and patience is wearing thin as the body count grows.  

History repeats.

In both wars military and political goals have been nebulous and changing over time.   Towards the end of the earlier war, President Nixon set the goal of “vietnamization,” so that South Vietnam would learn to care for and defend itself.  Sound familiar?  Nixon also set time tables for troop withdrawals, as has our current President.  For entirely different reasons, both wars led its respective military commanders to go home in shame and defeat: Westmoreland and McChrystal.   What the U.S. came to find out at the end of the Vietnam War was that the world went on for America; the enemy did not take over the world, and in fact collapsed upon itself over time, in the form of the Soviet Union.  In a similar fashion, if America pulled out of Afghanistan tomorrow, would America crumble and implode?   Probably quite the opposite.

So who do we turn to then for some expert guidance on our present predicament?  Well that would be none other than the master statesman himself, the sly one, Richard M. Nixon.  Hold on, hold on, before you shut down your computer or toggle onto the next site, hear me out.   Mr. Nixon, despite personal failings, was a brilliant foreign policy expert.  Some would say President Nixon was deeply paranoid, but you’d be paranoid too, if the Kennedy clan stole your 1960 presidential bid.   Besides, given the economic events that have unfolded in the U.S. and world economy over the last five years, what is paranoid?  Not even your worst nightmares can compare to this Kafkaesque economic dreamscape America presently exists in, brought to us all by the fine folks at Goldman Sachs, the FED, the U.S. Treasury, and AIG, Et Al.  But I digress.

Back to the man, the war, and the lessons not learned.   Upon leaving the White House under less than auspicious circumstances, Mr. Nixon set about cleaning up his image and he wrote several books.  Quite possibly one of the more obscure books Mr. Nixon wrote was called:  No More Vietnams.  And within it, Mr. Nixon laid down some very salient advice and counsel in conducting U.S. foreign policy, and in particular, the manner in which the U.S. military is to be utilized to further America’s political aims and goals.  Let’s cut to the chase, shall we.  

Former President Nixon wrote, and I paraphrase:

1)      Wars must only be engaged in with the support of the American people and the Congress of the United States.
2)      Military force should only be utilized as a last resort, and it must be used sparingly.
3)      The President must be highly selective in the use of force.
4)      Military goals and objectives should be clearly defined and achievable, and the objectives vital to our national interest.
5)      There should be only one overriding goal for the U.S. military and that is:  Absolute Victory!

Funny, Mr. Nixon didn’t place “nation building” on the list, which apparently was one of Mr. Bush’s goals, or came to be one of his goals over time, in Afghanistan.  To hear Mr. Holbrook (special ambassador to Afghanistan and Pakistan) state it:  the Bush administration’s "mission statement" for Afghanistan had been much more ambitious than the goal set by the Obama White House.

 

"It was creating a modern state, a modern democracy in Afghanistan with limited resources," Holbrooke said of President George W. Bush’s goals.

Sounds like nation building then, shouldn’t be the job of a single nation, or the U.S. military for that matter, but rather the duty of an international body, with International support and funding.

The bottom line is politicians do the U.S. military, and the United States overall, a tremendous disservice when we assign irrational goals and objectives to the men and women in uniform.   The first President Bush (H.W.) recognized all of President’s Nixon’s objectives, laid out above, in the first Gulf War.  In the first Gulf War it was:  Veni, vidi, vici !!!   And then you pull the military out, and let the politicians and diplomats set the parameters, hopefully, of a lasting, or at least well monitored, peace.

Based upon our lessons in Vietnam and with” vietnamization,” our activities in Afghanistan appear irrational, and nearly meet the definition of insanity.   And this is meant as no insult to the Afghan people, but attempting to turn people – with a rudimentary culture, education (if any) and economy – into democrats, overnight, would appear to meet that definition.   The U.S. military, the most effective military the world has ever seen, could spend four decades in Afghanistan and might never achieve the Bush mission statement.  Mr. Bush then, maybe with the best of intentions, set up our troops to fail with his goal of nation building; the former president might as well as told the U.S. military to capture and defeat the wind.

As for vital U.S. interests, the military goal was clear after 9-11, and the U.S. military achieved that goal in a matter of weeks, when Osama Bin Ladin was last seen running from Tora Bora and heading into Pakistan.  Done.  From that point on, the U.S. should have held its so-called ally, Pakistan, personally responsible for any and all terrorist activities against the U.S. or its citizens.  Because, as the leaks revealed this week, and as we all have known for some time, Pakistan plays a large role in providing safe haven, intelligence, support, and initiating the actions of destabilizing/terrorist forces in the region.  The problematic forces all receive support inside Pakistan, within the state of Warizstan.

In 1985, Mr. Nixon, a man ahead of his time, said it best:  “Terrorism today is an international challenge to an international order, and it requires an international response.”

Terrorism is not a war, in the conventional sense, but a cancer that has to be treated at multiple levels, on an on-going basis, within a society in turmoil:  politically, diplomatically, economically, spiritually, educationally, and culturally.   And yes, terrorism must be addressed when called upon, through the proxy arm of God herself, via U.S. military or NATO forces.  How do terrorist gain a foothold in a society(?), by responding to a vacuum, by providing the humanitarian and basic services that any decent government should be providing, to any group of people in a state of malaise or chaos.   Hamas in Gaza is a case study in point.

Based upon Mr. Nixon’s good guidance then, the U.S. military had already achieved victory in Afghanistan.  Nation building, and policing up the region, should be taken up by the U.N. and financed by the world.   Mr. Bush’s goal, in its present form, of building a modern democracy within Afghanistan is an abject failure, and a reflection on him, Dick Cheney, and his cohorts, the Republican Party.   The Second Bush administration, unlike his father before him, had no exit strategy in the region, and the same, probably, could be said of his administration’s goals and aims in Iraq.  (By the way, this dichotomy, Nixon/Elder Bush versus Cheney/Younger Bush, establishment Republican versus the Neo-cons, is the clearest example of what is wrong with the Republican Party today, and the reason why so many members have fled and independents are turned off.)

It goes without saying that the U.S. owes this man a debt, but Mr. Bush, in particular, as does the Republican Party, owes General Patraeus an everlasting debt of gratitude.   However, at a time of record federal debt, unemployment/underemployment in excess of 20% (per Shadow Government Statistics), the time and place for nation building is now, and right here at home, in America.  A long and sustained parting shot inside Waziristan by the U.S. Air Force, as the U.S. military pulls up tent stakes in Afghanistan, just might deliver the message that Pakistan needs.   And that is Pakistan will be held accountable for any and all terrorist activities within the region, or that initiate from its borders, globally. 

If Pakistan wants to play big boy politics with proxy forces and nukes, then they need to join the international order, and stop acting like some third world thug – dictatorship.  President Nixon was right, the last thing the U.S. needs is anymore Vietnams, but unfortunately, President Bush set the U.S. up with a beauty of a Vietnam within Afghanistan! 

 Copyright JM Hamilton Publishing 2015

The U.S. Command Economy?

The U.S. Command Economy?

The general rule for the use of the military is that it is better to keep a nation intact than to destroy it.  It is better to keep an army intact than to destroy it, better to keep a division in tact than to destroy it, better to keep a battalion in tact than destroy it….

The Art of War – Sun Tzu  (Translated by Thomas Cleary)

By J.M. Hamilton (2-1-15)

  

In regards Iraq, I guess no one in the Bush Administration bothered to read Sun Tzu.

The thought must have crossed my mind in 2008, in the midst of the financial crisis. The awesome power of the state, The U.S. Federal government, to protect and preserve vast sectors of the economy and major corporations, to save entire industries, and to pick winners and losers... first sparked the idea. And yet, having been a child of the cold-war era, and being raised on the tenets of capitalism... the idea, admittedly, seemed rather odd. Could the U.S. be a command economy, or at least be embracing some key features?

First a definition, as described from several resources, a “command economy,” (aka centrally planed economy), is an economy where government, rather than the market, determines what goods should be produced, and the price of such goods and services. China, North Korea, Cuba and the former U.S.S.R. are often held up as command economy examples. In short, the preeminent power of the state is used to determine what is produced, how much is produced, and the price of the goods and services produced.

In the following piece, J.M.H. attempts to explain how the U.S. may in fact, be a centrally planned economy (wittingly or unwittingly), or embrace some command economy attributes. Then move on to describe the industries that are planned and/or enjoy tremendous state backing and support; and finally, what a centrally planned economy means for Americans, the consumer, and our economy.

So in order to have a command economy, you need a central ruling body or political party. That’s an easy enough case to make, let’s examine the following.

1) As recently reported by Oxfam, the 1% own nearly 50% of all global wealth.

2) Aside from social policy issues, J.M.H. has been making the case for years, that we live in a one party state, with Dems and the GOP fighting each other to demonstrate who can best service the plutocracy. If the stock market is any measure, it looks like the Dems are winning.

3) SCOTUS decisions guarantee the ruling plutocracy are the government’s true puppet-masters, via McCutcheon and Citizens United. In short, our democracy is for sale, in a form of legalized corruption.

4) The amount of money flowing into each successive campaign cycle is both unprecedented and ever growing... much of it from anonymous sources. And neither political party has shown any interest in reining it in.

5) The Chamber and Business Roundtable hold uncompromised sway over the Congress and various government branches.

6) The relationship between government and the private sectors have become both blurred and symbiotic, with privatization of government activities and duties, and government spending making up 40% of GDP. Leading to waste, fraud, and a grossly mismanaged resource allocation.

In short, the nation is ruled by the plutocracy, so we have our central planning committee or single ruling body right here.  As with China, and the former U.S.S.R., not everybody within the governing body, or within the Plutocracy, is of one accord. But generally, as stated by Mr. Lawrence Summers to Senator Elizabeth Warren, one tenet holds basically true: Insiders don’t criticize insiders.

So if the U.S. has a core cadre of elite rulers using democracy as a façade, and politicians as a mask (maybe not dissimilar to China's elite ruling body), what are the key “planned industries” within our economy? Here, look no further than industries that are singled out for privilege, special treatment, tax breaks, government largess, have unimpeded access to politicians, are exceptionally concentrated, and that consistently, roll regulatory bodies and authorities. The following industries make that list:

1) The Wall Street banking cartel. There’s probably no other U.S. industry that receives unprecedented sums of government assistance than the Wall Street cartel. Whether it be outright bailouts, worth trillions of dollars (with no strings attached), or the fact that we have branch of government, The Federal Reserve, that is tacitly dedicated to maximizing banker welfare and inflating asset prices - there is no other industry that receives so much at the nation's expense. That this industry often works at cross purposes with the interests of its clients, Main Street business, investors, and the American public is no longer in dispute. In fact, it’s well documented. And yet, the Leviathan keeps moving forward, rolling back regulatory reform, and setting the U.S. up for the next crisis.

2) The Defense Industry. It’s no accident that the top government contractors all work for or supply the DoD and the Surveillance State.  It’s also no accident that the Pentagon has not passed an audit in years, and there’s little or no accountability within this industry. The revolving door between the military brass and executive positions at these major military corporations is on full display, and helps insure that there is no sustained criticism (The Pentagon has become little more than an advocacy group for war and the MIC). Quite to the contrary, at least one political party believes the U.S. must be permanently engaged in war, and plays the fear -card, constantly. Hence helping to insure that a bewildered and frightened American public never questions the gross fraud and negligence that is attendant within the military industrial complex. Lockheed Martin’s F-35 being the classic example. Our Congress not only kowtows to the MIC, but runs interference and heaps contracts upon contractors for weapons systems that are not needed. Offline budgets, black budgets, DoD budgets that are classified: What’s to hide? Apparently, a great deal and billions. The GOP likes to go after government assistance for the elderly, children and the indigent, but when it comes to welfare for the MIC, the sky is the limit.

3) Telecommunications and the Cable Industry. Grants of monopoly are handed out to this industry, like Halloween candy. And all the plutocracy demands in exchange are the communications records of every American with a cell phone, hard line, and/or computer. (Heh, if you are not a member of the plutocracy than you're probably a threat, or at least guilty until proven otherwise.) And the industry is all too happy to comply. The fact that it costs less than $10 a month to provide an internet connection, and our cable/internet bills spiral ever higher, shows just how insidious monopolies and cartels are to consumers, competitors, and other businesses competing for the middle class’ ever declining discretionary income. And yet the Congress and the regulatory bodies (Justice, FTC, SEC) are all too happy to approve combination and consolidation for the enrichment of the plutocracy that governs us all, at the American people's expense.

4) Silicon Valley, U.S. software developers, and Internet Companies. See Telecommunications and the Cable Industry above. Ever wonder why it’s so easy for your computer or phone to be hacked? Ever wonder why businesses and major corporations are hacked daily? It’s in no small part due to our government, the NSA, CIA and FBI, insisting that there be no encryption in the U.S., and that hi-tech companies build back door openings into computer programs, software, and hardware - for ease of government access.  (Moreover, internet companies, like Facebook and MSN, are forced to surrender client information to the Feds, without a warrant, etc.) These built in engineering flaws are not only accessible by our government, but may also be exploited by foreign governments, organized crime, or the hacker next door. That the NSA has had a hell of a time pointing out any major terrorist event that they have stopped by their actions, is beside the point. The symbiotic relationship between the government and Silicon Valley may in some ways be responsible for the billions of dollars in on-line fraud and theft; and through circular logic, one of the key reasons why we need the NSA, FBI and CIA. Karma has an ugly way of exacting justice, and because the Valley works so closely w/ the Nation’s top spies, foreign countries are increasingly cutting their ties, costing the Valley billions. Unfortunately, most American’s are so frightened that they are all too willing to surrender their privacy to these corporations and our government, or are simply, too oblivious to care. Our surveillance state in action, and your freedoms, civil liberties, identity and financial well being, up in smoke or well on their way.

5) Big Pharma - This industry is amazing. We are the only Western democracy that permits this industry to gouge consumers, the taxpayer and our own government, with monopolistic profits. Wonder why nearly 20% of our economy is dominated by Healthcare? Big Pharma plays no small part.  And yet, not content to help themselves to the contents of your life savings or looting our government, Big Pharma has also played its part in industry consolidation and tax inversions. Meanwhile shortages of critical medicines abound, and Big Pharma has become much more adept at extending the lives of patented medicines, and buying out competitors and initiating stock buybacks, than in developing new medicines. And where’s our Congress and government to stand in the way of Big Pharma’s predatory ways?  Owned by the plutocracy, you’re more likely to find our Congress playing lap dog and cheering Big Pharma on.

6) Big Ag.  Yes, nothing is sacred, not even the food that enters your mouth. From killing off the Bee population (the proverbial canary in the coal mine), genetically modified foods, pesticide and herbicide overkill, all the way to farm animals shot through with steroids and antibiotics (and inhumane science experiments conducted upon them), here‘s another industry where the ends always justify the means. And it’s one more industry protected by our government, as the regulators look the other way or allow the Ag industry to regulate itself.

7) Big Oil. For sake of time, I think it’s best to the let the industry and a recent J.M.H. piece speak for itself: Big Oil has got Your Back.

These industries are the players in our possible de jure or de facto command economy.  Noticeably missing from the list are manufacturing concerns, and I suppose we could place GM on the list, since the automotive industry has enjoyed a couple of bailouts over the years. But it seems that up until recently, most American politicians, and the plutocracy, had all but given up on U.S. manufacturing. Given free trade agreements, globalization, outsourcing, and private equity, manufacturing seemed all but done for.  Only the realization that a diverse economy, without too much dependence upon anyone sector for jobs and opportunity, caused our political leadership to re-evaluate manufacturing. That and the growing cost of labor within the BRICs, and inexpensive U.S. energy, have combined to cause industry to reconsider America as a manufacturing destination.

No, if I was to consider adding one more protected industry to the list, it would be Private Equity. An industry that is antithetical to all the best attributes of capitalism, that is laissez faire capitalism’s extreme. For all intents and purposes unregulated, private equity robs employees, fosters consolidation and monopoly, often cheats investors, and all too often leads formerly, perfectly healthy companies into bankruptcy. It is an industry that is the American dream’s darkest chapter.

So if America operates a command economy or exhibits many of the characteristics of a centrally planned economy, what does that mean for workers, consumers, opportunity, and the economy at large?

  

One of the more shocking revelations of the 2008 financial crisis was how dependent the one-percent are on the government for maintaining both their wealth and power.   In fact the one-percent have co-opted government and taken over our democracy, and in the process redistributed wealth from the 99%, and future generations, to themselves.  That these same elites often decry “socialism” for the "masses" and insist upon fiscal austerity, while helping themselves to a heaping plate full of government largess through deficit spending, wars without end/nation building, privatization of government, too big to fail institutions, free money from the Federal Reserve, tax cuts, the lack of regulation in key industries, and grants of monopoly…. Screams hypocrisy.

In the process many industries have metastasized into monopolies, oligopolies and cartels… in short, the crony economy, and perhaps a command economy.  Wall Street, the stock market, and stock analyst love cartels and monopoly because it guarantees profits.  But as I wrote in my last piece, Lombardi, Exceptionalism, and the Rule of Law, grants of monopoly, or gifting the means of production into a single private party’s hands, are little more than socialism by private proxy.  Once again, demonstrating the double-standard the elites live by.

There’s just one problem:  capitalism without competition – that is, bordering on a command economy -  leaves consumers, workers, investors and Main Street businesses to be preyed upon.  The aforementioned, the 99%, suffer: by paying higher taxes to subsidize tax dodges for the elite; paying higher prices to support monopolistic taxation; the 99% bears the unseen and delayed costs of the lack of rules, regulation and the contamination of our planet; and it is our children who will pay the price for deficit spending, a national debt that it out of control, and the machinations of Federal Reserve policy utilized to bailout the plutocracy.  And investors suffer through a lack of alternative investments and businesses with which to place their money.

Moreover, when wealth is redistributed to the 99%, it makes its way back into the economy, whereas the elite generally hoard same, or send their savings/government largess back to Wall Street (which has diverged from the Main Street economy's interests).

As a devout reader of National Review throughout much of the eighties, William F. Buckley’s magazine, rightly, used to denounce the rulers who stood upon the Kremlin’s walls during the May Day parades as little more than mafia and gangsters, and simultaneously, lamented that Russia's citizens were mere slaves.  A command economy is ultimately a highly dangerous thing, as the economy finally stagnates; becomes less responsive to consumer, worker and investor needs - due to the lack of competition; and moreover, results in serious resource dislocation.

Don’t take my word for it.  Examine the former Soviet Union, which has now been consigned to the dust bin of history.

It's no accident that the last thirty-five years have coincided with the rise of the plutocracy, middle-class diminishment, and greatly polarized wealth inequality.  It's just another symptom of a possible command economy.

Copyright JM Hamilton Publishing 2015

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