Class warfare?

"Wall Street," that metanym for wealthy financiers, bankers, hedge fund managers, etc, is indignant that "Occupy Wall Street" protestors are calling attention to the stark disparity between the 14,000,000 jobless Americans and the soaring corporate profits and CEO bonuses, and to the widening economic gap between ordinary people and "Wall Street" people.

Wall Street is indignant? Yes. Panicked? Maybe. Paul Krugman -- my next to favorite economist after Joseph Stiglitz -- looks at the protest movement in this light in his October 9th NYT column, "Panic of the Plutocrats." I cut it down some, but almost every sentence is essential:

. . . Consider first how Republican politicians have portrayed the modest-sized if growing demonstrations, which have involved some confrontations with the police — confrontations that seem to have involved a lot of police overreaction — but nothing one could call a riot. And there has in fact been nothing so far to match the behavior of Tea Party crowds in the summer of 2009. Nonetheless, Eric Cantor, the House majority leader, has denounced “mobs” and “the pitting of Americans against Americans.” The G.O.P. presidential candidates have weighed in, with Mitt Romney accusing the protesters of waging “class warfare,” while Herman Cain calls them “anti-American.”

. . . The way to understand all of this is to realize that it’s part of a broader syndrome, in which wealthy Americans who benefit hugely from a system rigged in their favor react with hysteria to anyone who points out just how rigged the system is.

Last year . . . financial-industry barons went wild over very mild criticism from President Obama. They denounced Mr. Obama as being almost a socialist for endorsing the so-called Volcker rule, which would simply prohibit banks backed by federal guarantees from engaging in risky speculation. And as for their reaction to proposals to close a loophole that lets some of them pay remarkably low taxes . . . [the] chairman of the Blackstone Group, compared it to Hitler’s invasion of Poland.

And then there’s the campaign of character assassination against Elizabeth Warren, the financial reformer now running for the Senate in Massachusetts. . . .

But listening to the reliable defenders of the wealthy, you’d think that Ms. Warren was the second coming of Leon Trotsky. George Will declared that she has a “collectivist agenda” . . . Rush Limbaugh called her “a parasite who hates her host. Willing to destroy the host while she sucks the life out of it.”

What’s going on here? . . . Wall Street’s Masters of the Universe realize, deep down, how morally indefensible their position is. . . They’re people who got rich by peddling complex financial schemes that, far from delivering clear benefits to the American people, helped push us into a crisis . . . .

Yet they have paid no price. . . basically, they’re still in a game of heads they win, tails taxpayers lose. And they benefit from tax loopholes that in many cases have people with multimillion-dollar incomes paying lower rates than middle-class families.

This special treatment can’t bear close scrutiny — and therefore, as they see it, there must be no close scrutiny. Anyone who points out the obvious, no matter how calmly and moderately, must be demonized and driven from the stage. . . .

So who’s really being un-American here? Not the protesters, who are simply trying to get their voices heard. No, the real extremists here are America’s oligarchs, who want to suppress any criticism of the sources of their wealth.

I would add to all this the uniqueness of the current "robber barons." Unlike the industrial giants of the past who made their fortunes in something useful to society (railroads, steel mills, and oil), these guys got rich by gambling -- with other people's money. That's exactly what all the complex credit swaps were: betting with other people's money.

They didn't manufacture anything useful. They didn't provide necessary transportation services, like railroads or airlines. They didn't even make non-tangible but entertaining or edifying things like Hollywood moguls produced movies. They just gambled with other people's money. And gamed the system to lose, so they could win. Duh !!! And Alan Greenspan didn't see it coming?

Now they are indignant that reformers are trying to put an end to the free ride given them by taxpayer-funded bailouts when they screwed up? That's what I think Occupy Wall Street is all about, even if the not-well-organized demonstrators haven't quite defined their message. In a way, they are the counterpart to the Tea Party -- at the other end of the right-left spectrum.

Back to Krugman:

So who’s really being un-American here? Not the protesters, who are simply trying to get their voices heard. No, the real extremists here are America’s oligarchs, who want to suppress any criticism of the sources of their wealth.

Indeed ! Yes, it's class warfare. That's what it has been ever since Republicans began dismantling the New Deal and regulatory control. Let's take them up on it, and call it for what it is -- and wage the good fight against the system rigged in their favor.

Once the Repubs get through the silly season of their primary campaign (I for one applaud their ever-earlier primaries, so we can get those debates over with and get all the crazies off the stage), there should be a real debate between the two parties about the role of government in the economy and in providing services to the people. Then let the American people choose which party to put in power.

Come on, Democrats. Here is your campaign message. Use it !!

Ralph

Repubs kill jobs bill

Yesteday, Senate Republicans used the 60 vote, faux-filibuster tactic to prevent moving Obama's jobs bill to the floor for debate and vote. Predictable, but nevertheless reprehensible.

Today, the New York Times lead editorial called it

"a breathtaking act of economic vandalism."

It continued:

There are 14 million people out of work, wages are falling, poverty is rising, and a second recession may be blowing in, but not a single Republican would even allow debate on a sound plan to cut middle-class taxes and increase public-works spending. . . . independent economists say [the plan] would have a significant and swift effect on the current stagnation. . . .

Republicans released their own "plan" today. It consists of nothing but their tired old mantra: cut regulations, repeal Obama's health care reform, more tax cuts, and a balanced budget amendment.

It won't work.

Manufacturers are not holding back on hiring because of those things; they're not hiring because people are not buying; people are not buying because they don't have jobs, they've lost their jobs, and they're afraid of further hard times. What don't the Repubs get about that?

The Times editorial continues:

Their lack of serious ideas was on full display in both the Senate and the presidential debate on Tuesday night in New Hampshire. The debate was ostensibly about the economy, but when the freshest and most-talked-about idea is Herman Cain’s ridiculous “9-9-9” tax plan, it is clear that the economy they were debating is not the one Americans are forced to live in. . . . [Cain's 9-9-9] is a formula designed to cut taxes for the rich and increase them for the poor, raising the deficit and doing nothing for growth. . .

The other candidates were no less vacuous. . . . Republican candidates fear the Tea Party too much to acknowledge that economists are solidly behind government intervention to awaken growth. . . . But at least the record is increasingly clear who is advocating real ideas and who is selling an empty vessel.

Obama is working hard now to get people to listen to these facts.
The question is: has he waited so long that Republican lies have been repeated so many times that too many people now have them imprinted in their brains as the truth?

Ralph

A kinder, gentler generation

Here is a heartwarming story from today's Atlanta Journal-Constitution:

Kennesaw Mountain High School in Marietta, GA held its homecoming celebration last night. One of the five young women elected by the junior class to represent it in the Homecoming Court was 17 year old Lily von Schmeling. The article included a picture of Lily in tiara, holding a bunch of roses, and standing with her tall, handsome young escort.

Nothing unusual about that . . . except that Lily has Down's Syndrome.

Inured to the prejudices of the past, my first thought was that it was a cruel joke. But read further and trust this younger generation.

Lily is indeed a very popular girl at Kennesaw High. When her name was announced at the game's half-time, she was greeted with a roar of approval from the crowd, some of whom held up signs, that read: "It may be chilly, but we love Lily."

Lily took it in stride, but her mother and sister were overwhelmed at the outpouring of support. Her mother praised the school for being "very welcoming to students with disabilities."

But apparently it is not pity that makes Lily such a well-loved member of her class. The school counselor says she makes friends easily and interacts well with her peers. Her sister says that Lily brings out the best in other people with her sunny disposition and her enthusiasm.

Although she is not able to do all the acrobatic stunts with other cheerleaders, she is a member of the team and helps to lead cheers at the games; and she participates in the Drama Club. I've heard similar stories from other families with Down's kids: they often radiate uncomplicated love and warmth toward others and evoke similar responses.

Congratulations to Lily -- and to the students, faculty, and staff at Kennesaw High.

We older generation could learn a lot from you.

Ralph

A debate morsel

Just one short comment about tonight's GOP debate:

Mitt Romney has become a really good debater (substantive arguments aside), giving ever more crisp, clear, and to the point answers. Perry avoided major gaffes but didn't help himself any tonight on his fourth try, so I'm guessing Romney will surge ahead in the polls and will be the eventual nominee.

Given the opportunity to ask any question of any other debater, Romney didn't try to hit anyone in a vulnerable spot, as the others did, but instead asked a really softball question of Michele Bachmann -- something like what would you do to get people back to work?

I'm sure that was a carefully thought out tactic: Score points for being a gentleman? He's ahead so don't attack anybody? Try to bolster her to help knock out Perry? Hoping to get her support with her religious right base?

Or is he possibly thinking of her as a VP running mate?

Ralph

PS: I'll put any other morsels about the debate in the "comments."

Molly Ivins, where are you when we need you?

Molly Ivins had a way with words -- she was unbeatable in the tart put-down of politicians. It was from her I first heard the word "bloviate" in reference to a particular congressman known for his windy obfuscations.

Molly also was an expert on George Bush, having known him in high school, as I recall, as well as being a journalist in Texas during his term as governor. She was not his biggest fan.

Bill Keller wrote an op-ed in yesterday's New York Times about the Tea Party's disappointment in what the GOP field seems to be coming down to. He predicts that they will eventually sour on Cain (their darling of the week) and settle on Perry.

He concludes this piece by quoting Molly Ivins, whom he refers to as "the late, wise-cracking Cassandra of Texas politics":

"Next time I tell you someone from Texas should not be president of the United States, please pay attention."

Amen.

No one could ever replace Molly Ivins. She was a national treasure (for us liberals, that is). But, sadly, no one writing about politics or public policy today even comes close.

I once heard her speak at a local ACLU dinner meeting here in Atlanta. It was soon after the Bush administration took office and not long before she began a courageous battle with breast cancer, which finally took her life.

But on this occasion, she was in top form. She took the podium, raised herself up to her full height (she was a tall woman), looked out at the audience for a moment, and then began with this:

"Folks, we are in deep shit."

And that was just the beginning of a rip-roaring tour through her backroom knowledge of politicians, and especially Texas politicians.

Ah, were she only still with us to wither the current crop of GOP wannabes with her wit.

Ralph

Bombshell -- just 11 years too late. . .

Retired U. S. Supreme Court Justice John Paul Stevens has just given us a behind-the-scenes glimpse at what went on in the court that threw the 2000 election to George Bush.

From the Huffington Post article:

Former Supreme Court Justice John Paul Stevens writes in his new memoir, Five Chiefs, that the George W. Bush campaign's 2000 appeal to the United States Supreme Court over the Florida recount was "frivolous" and never should have been granted.

He recalls bumping into Justice Stephen Breyer at a Christmas party and the two having a brief conversation about the Bush application to halt the recount by issuing a stay. "We agreed that the application was frivolous," he writes. "To secure a stay, a litigant must show that one is necessary to prevent a legally cognizable irreparable injury. Bush's attorneys had failed to make any such showing."

By a five-to-four vote, the court granted the stay. "What I still regard as a frivolous stay application kept the court extremely busy for four days," he writes. He adds that no justice has ever cited the opinions that provided the basis for their ruling.

This does not make me feel one whit better about the Bush presidency. It just twists the knife of frustrated outrage that we -- and the world -- had to endure the consequences of such a momentous decision made by such a slim majority and in the absence of any legal justification or explanation.

Am I wrong in my memory that Justice Sandra Day O'Connor later said she regretted her vote with the majority on this? Or was that some other decision I'm thinking wistfully about?

Ralph

Occupy Wall Street protests

Here's what it's all about:

INEQUALITY

With corporate profits soaring, with banks that were bailed out by taxpayer money giving million dollar bonuses to executives who caused the problem in the first place, and with unemployment stuck at nearly 10%, which doesn't even count those who have dropped out of the labor force and are no longer in the statistics . . .

There's this news:

Medium annual household income has fallen more during the recovery than it did during the recession.

From December 2007 to June 2009, incomes declined 3.2%
From June 2009 to June 2011, incomes decline 6.7%

Some "recovery" then. Huh? Unless you're rich or Republican.

Eric Cantor says he's getting "increasingly concerned about the mobs."

Good. Let's give him more to worry about. Let's have more "mobs" of suffering working class and middle class families marching in protest of Cantor and his hard-hearted cronies enjoying the spoils.

That is what is being protested.

This is not advocating socialism (but what would be wrong with that?). It's about cutting benefits for the poor, about laying off teachers, closing libraries, and gutting funds for research and environmental protection -- while, at the same time, allocating $1.5 million for the fool's errand of defending the unconstitutional Defense of Marriage Act in court . . . plus their eternal mantra: cut taxes for the "job creators."

They mean rich people and corporations. That's been done -- and it does not work that way.

So let's be clear about this -- and let's make the protests grow. There's one scheduled here at the state capital in Atlanta this Saturday.

Also: you can sign a petition of the DCCC to stand in solidarity with the Occupy Wall Street movement at: http://www.dccc.org/pages/occupy

Ralph

Stiglitz: "This is NOT captalism."

Nobel Prize winning economist Joseph Stiglitz addressed the Wall Street protest crowd on Saturday. This is the man the president's financial advisers should have been listening to as the big bubble was about ready to burst.

Here's the kind of clarity he speaks:

What Wall Street is practicing "is not capitalism."

“There’s a system where we socialize losses and privatize gains. That’s not capitalism. That’s not a market economy. That’s a distorted economy, and if we continue with that, we won’t succeed in growing.”

Simple, direct, true.

And exactly the opposite of what every GOP presidential hopeful would say. Not to mention the sort-of, but-not-quite, accepting economic advisers to the Obama administration. It's a little better with Larry Summers gone, but I'd love to have seen Stiglitz appointed to take his place.

Ralph

For what it's worth -- (not much)

For so many years, Ayn Rand admirer and the "Oracle" of the Federal Reserve Bank, Alan Greenspan, spoke in a distinctively opaque style that sent economic analysts scurrying to parse every nuance, as if he had superior wisdom or at least some insider knowledge.

It turns out he didn't. Perhaps his opacity was merely a camouflage for his not knowing. In retirement, and well after the crisis erupted, he said that he had not seen the financial collapse coming.

How could he not see it?

With only kitchen-table understanding of finances, I knew as soon as I started paying attention to the disaster that any economic boom, which is based on getting rich by betting that your investments will lose money, is doomed. And that is essentially what the whole credit default swap system was.

It's like lending your kids money, and then making a bet with your neighbor that they won't repay the loan.

All you have to do is think about the larger economic system instead of the individual bank or individual investor. And that was supposed to be Greenspan's job.

Now, perhaps hoping to reclaim a bit of respect, he has announced his support for letting the Bush tax cuts for the wealthy expire. Yes, those same tax cuts he supported back then.

That's nice -- but is anybody still listening to him?

Ralph