Several articles/editorials have been written lately in various places about the fact that we, the taxpayers, via our government, could be buying the businesses we are bailing out for less than we are giving them or guaranteeing them.
For example, apparently the big three automakers can be bought for $10-$15 billion, while we are considering bailing them out with $25 billion or more.
Citigroup, which is worth about $20 billion, got a government guarantee of $250 billion in exchange for $7 billion at 8% (less than Buffet's 10%) and some warrants at about 4x current market price.
Sorry for being lazy, but I'm guessing AIG and others have done at least as well, while we, the taxpayers, via our government and government-elect's acts of comission and omission, have been screwn.
So, I have to wonder, as many smarter people before me have, why the hell we aren't buying these damn companies and nationalizing them, at least until they become profitable, then selling them back to a private entity for a profit, as Switzerland did so effectively in the 90s? At the very least, why aren't we getting equitable chunks commensurate with our investment, as Britain is doing now (and Switzerland also did)?
I guarantee you there are tons of bright, experienced managers who would die for the opportunity to prove they can turn these companies around at a fraction of the cost of the guys who drove them into the ground.
We know the answer why this won't happen, of course. We do, in fact, have a thinly veiled Mussolini-style fascist, corporatist government. I know, I sound like Noam Chomsky. Forgive me for talking immoderately about the colossal mess we are in. But how else do you explain where the first several hundred billion of the bail-out went? Why we can't even ask the Fed to tell us who they've given money to? Why it is Tim Geithner wants to boot Sheila Bair from the FCC because she's "too independent" (meaning, she actually gets it and is doing what is in her power to do about it)?
Sorry, while anarcho-syndicalism, at least as I understand it, is just plain silly, Noam is right on this: the financial elites own our government.
No matter who is actually sitting in the offices, writing the redacted e-mails, creating crippled legislation, holding hearings, writing stern letters, etc., we get token justice, amortized over generations. And in exchange we give the consent implicit in doing little or nothing about huge boatloads of injustice.
The administration leaders get seats on the CFR.
And the elites keep reaching further into our multi-generational future earnings potential.
We could similarly examine
- companies too big to fail;
- executive compensation;
- golden parachutes for poor performance;
- the ill-effects of the concentration of wealth on the nation, not to even mention the common good;
- over-"financialization" of the economy (e.g., making money from derivatives instead of widgets or ski lessons).
And then we could come up with solutions
- anti-trust enforcement;
- executive compensation regulations, especially for "losing" concerns;
- effective (not sticker) tax rates for the upper brackets;
- limits and regulations on gambling rather than investing in goods and services as a percent of GDP or something).
And after each case we would face down the same bugbear: our government is not OUR government.
Put another way: the indirect action of electing a representative is not even remotely enough. It's just the start, and frankly, after 8 years of waiting, I'm amazed we did it. Today, at this point, we are still pissing on the dark side of Pluto.
In order to address any of the issues listed above, which are only a piece of the enchilada, we will get long drawn-out blue-ribbon committee deliberations followed by half-measures of quarter-measure legislation staggered over generations, all in the name of bipartisanship, moderation, free trade, etc. And, despite the advances here and there, somehow the net results ultimately will circle back to similar conditions, because along the way the solutions will be hog-tied or cast overboard, like Glass-Steagal, by both moderates and wingnuts, as being outdated and unnecessary, like welfare and quality education. And the taxpayers will be too busy working, watching TV or finding someone they want to have a beer with to much notice. In the end: The New New Neutured Deal, if you will.
Which brings me to my bucket of questions:
- What will it actually take for enough people to give enough of a shit to actually matter?
- How many more trillions of dollars of fraud and corruption will it take?
- And what, exactly, will giving a shit actually look like?
- Another groundswell for the midterm election, or the next Presidential?
- And then, when we are still hemorrhaging to the special interests?
- More or less of the same?
- Years of indirect action, propelling candidates into office who face the same daunting odds within the same system against the power elite who become their daddy before our heroes even get to DC?
We really don't have to wait this out to know that the results will fall far short of what is needed to overcome the effects of the thirty year pact between the puppetmasters of the voodoo economists, right-wing media echo chamber and the moral majority.
As hard as I worked for and as much as I love and respect Barack Obama and hope for change and believe he wants to implement it, the bottom 95% and the future of this country and this planet will continue to suffer, even with debt-financed jobs and tax cuts. And, relative to the rich and the rest of the world, they will continue to work harder and fall further behind. There is nothing on the books that will change that, and the negotiating hasn't even begun. In fact, some of the things that were on the books, like rescinding the tax cuts on the rich, are ALREADY receding into the future, pre-inauguration...
(Note: while the rate of the concentration of wealth slowed appreciably over the course of the Clinton years, it never stopped; the concentration of wealth is in no small part the reason we are where we are today.)
(Hint: the time for moderate triangulation is long past).
Experts are already predicting that by 2025, the U.S., the world's financial superpower, will be no more than a "leader among equals". And in 2050? Less.
As Kevin Phillips and others have warned, concentration of wealth, over-financialization of the economy and military over-reach have a proven track record of doing in empires (Spanish, Dutch, British...).
As Jared Diamond has pointed out, environmental destruction, resource depletion and climate change devastate civilizations, too. Collapse.
How 'bout all of the above, at once, NOW?
Does this evoke a visceral reaction? Does it get you kinda worked up? Or does it just feel like a downer best left alone?
I mean, this IS happening to our country and our planet on OUR watch.
If a man with an axe busted down your door, hacked down the wall and took the safe with everything you have and much of what you will ever have inside it, slung it over his shoulder, marched it outside, tossed it in the back of his yacht, and took off down the canal, paraphrasing Jimmy Malone/Sean Connery in "The Untouchables", what would you be prepared to do?
That's not a rhetorical question.
Unless you have a net worth of tens of millions dollars or more and earn the better part of a million dollars or more a year, in which case the laws make it pretty difficult for you to fail, it's already happened to you.
And he keeps coming back for more. Every day.
So what are we prepared to do?
I'm asking this because we watched the man with the axe in action during the 2000 election, and we and our leaders collectively, for all intents and purposes, stood around, slackjawed, scratching our heads. Ditto for the run-up to the Iraq War, minus those relative few who actually did try to stop it, the 2004 election and all the other atrocities too numerous to mention that went relatively unchallenged over the past eight years. It took eight years to muster enough determination to effectively respond and convince 53% to join us. What are we, a pack of ADD-addled dinosaurs?
Paraphrased and excerpted from "Not Deterred," by Paxus Calta-Star, in a book edited by Paul Rogat Loeb called "The Impossible Will Take A While: A Citizen's Guide to Hope in a Time of Fear."
It's 1996 in Sophia, the capital of Bulgaria. Unlike many of its neighbors, Bulgaria did not throw out its communist leaders, but instead settled for minor reforms.
Polina is 18. She's concerned because Bulgaria, Russia and the U.S. have worked out a deal to complete an unfinished nuclear power plant that had been half-constructed in the 80s. Other reactors in the country experienced serious accidents and had to be shut down. Polina has joined For the Earth to fight this reactor. They hold a conference and lots of esteemed authorities discuss various alternatives that could be promoted in order to replace the project: alternative energy, greater energy efficiency... Polina remarks, "if you want to stop the construction... you need to overthrow the government." Conversation continued, the conference ended.
Polina and 20 friends went to Parliament to protest. Entertained, the media shows up and televises it.
"Three months later, in March 1997, there are 20,000 people on the steps every day. Bowing to popular pressure, the government resigns. Shortly thereafter, the first Democratic reform government is elected. A couple of months after that, they release their energy policy--canceling the Belene project."
Obviously, we don't need to overthrow our government, nor could we do it with 20,000 protesters, even daily. Not that we could really expect to do that without a significant change in mindset. Nevertheless, we do have serious problems that need serious solutions, we can't take for granted that they will be, in fact we can be pretty much assured that in many really important ways they won't be, and it will take unimaginably outrageous action to change that.
But most days now everyone expects Obama to do it alone--"decider"-style, which is why we can ignore his cabinet appointments--or waits for further instructions, and STFU in the meantime, of course. (Which unvariably will lead to many, many more calls for STFU until...) When and if he needs us, he'll let us know. He's got this, remember?
...as if we don't know anything today about these bailouts, companies too big to fail, executive pay, concentration of wealth and over-"financilization" of the economy.
...as if we can't articulate intelligent concerns and/or demands while the clock runs.
...as if it would be impolite to be demanding more of the government and the government-elect that we do have in the meantime, you know, TODAY.
...as if we have time for honeymoons, while the man with the axe wreaks havoc on the rest of the century.
...as if there were no man with an axe.
What are we prepared to do?
Because, IMHO, the man with the axe IS still rampaging through our world, current and future, pretty much unconstrained. Just listen to Henry Paulson any night of the week. The indignation he faces by our leaders and we the taxpayers is still, however hopeful, so pathetic it is effectively non-existent.
So, other than celebrate and pat ourselves on the back about the election and enjoy the holidays, what are we prepared to do, about the man with the axe, tearing up all the good parallel universes left ahead for our children and grandchildren?
Cause all I hear is moaning and teeth-gnashing about Bush and Paulson and now Clarence Thomas, STFU about Obama's appointments, and Christ-on-a-cracker, Lieberman-on-a-dredle, Lou-Dobbs-on-taco, wait until Obama's inaugurated before expecting or asking anything of him... The man with the axe is...Bush's fault!!!
In the meantime, all we need is someone to blame and some eggnog?
And in the months it takes for the Obama administration to push the government into action (notwithstanding the tidal wave of executive orders he will sign upon entering office, which I admit will be sweet), what are we prepared to do while the man with the axe continues to run wild? Because things like the economy, Iraq War and healthcare won't get solved overnight, especially when approached in moderation.
I hate to be the bearer of bummers, really, because it's so unpopular and I like being popular as much as the next guy, but my ego is a heckuva lot less important to me at this moment than this 800-lb. man with an axe everyone wants to ignore.
Folks, the sky--the economy of today and the long-term future, both, just for starters--continues to fall everyday. Sorry, this chicken little is so right you can track it on the stock market; you can follow it in consumer confidence; you can see it in the national debt and deficit; you can watch it in the under-estimated unemployment numbers; hell, you can even follow it on the evening propaganda. (You can watch it slide off Antarctica...) Yes, folks, hate to break it to you, but the sky IS falling; nothing very constructive is happening in government, business or the grassroots; and nobody wants to talk about it, other than to malign Bush or Paulson or invest all their hopes in Obama...next year.
I'm no Jimmy Malone. I haven't taken a gut full of lead and dragged myself thirty feet across the floor to tell you this. Just like most of you, I'm doing fine. I seem to be doing fine. I can blog. I can watch gazillions of channels on satellite TV (including MSNBC). I can go to my daughter's basketball games. I can do all kinds of things, and so can she and her older sister and my wife. But I know we're NOT okay. I know in fact we have been under seige for decades and that I, my wife and/or my daughters may well wake up in a second-class country, with far fewer options than those few we have today. The options are dropping like species of flora and fauna. Because, unless a whole helluva lot of us get sensible and/or angry and damn heroic--like the abolitionists and suffragettes and civil rights movement--the man with the axe will just keep hacking away, filling his yachts with the savings and consumer electionics our grandchildren will have to work overtime to pay China back for.
I'm writing all this cause I look around and I don't see many of us who look scared, hungry or angry enough to tackle the work ahead. Maybe I'm misunderstanding. Maybe when 3,000 people show up to protest Prop 8 and no one shows up to protest Paulson, Bernanke and Cox or the CEO's of the big 3 automakers, it doesn't seem like we're on top of our game. It looks to me like we are as far away from the level of organization and response we need to deal with the problems we are facing now as we were in 2000 from getting worked up enough for victory in 2008.
And meanwhile, our horizon has about 360 degrees of points of no return.
So do we keep on truckin' down the same path, blogging, watching our flat-panel TVs and playing our gaming systems, or do we get about doing something even bolder and braver than electing Barack Obama so we can give future generations the better world it deserves and needs to survive?
Is it worth it?
P.S., For those who think there is work we should be organizing and doing, I highly recommend Loeb's book for perspective, ideas and inspiration. It has 49 great poems and essays from Seamus Heaney, Desmond Tutu, Nelson Mandela, Jonathan Kozol, Marian Wright Edelman, Howard Zinn, Vaclav Havel, Pablo Neruda, Sherman Alexie, Tony Kushner, Jim Hightower, Arundhati Roy, Mark Hertsgaard, Adrienne Rich, Maya Angelou, Alice Walker, Terry Tempest Williams, etc.