Posts Tagged ‘Palin’

Take a look at the map of states that were won by John McCain and those won by Barack Obama in the 2008 election. It’s pretty clear that Obama won the northeast part of the country and he also won the west coast.  McCain pretty much won the south and the west, except for the coast.  Besides looking at this as just a map of red and blue states, we can also inquire about the nature of these states.  Is there something about the blue states that would inherently indicate that they would lean Democratic while the red states would lean Republican? I think so; it’s the population.

The northeast and the west coast are the most densely populated areas of this country, while the south and the west are farm and ranching areas – generally.  Of course there are exceptions like the cities of Dallas and Phoenix.  However, I think there is something to be inferred from this distribution of red and blue states that spells disaster for the Republican Party down the road.  It’s just like watching an out of control train as it speeds downhill toward a 90 degree turn.  You already know what the result will be.

Today, the population of the United States is a little over 307 million people. The majority of these people live in the heavily populated areas of the country, i.e. the northeast and the west coast, and these areas are growing.  So why are these areas also the most Democratic parts of the country? And why are the more sparsely populated areas primarily Republican? I think it’s because of the underlying philosophical differences between the two parties.  In general the Democratic Party stands for social programs, i.e. people helping people or government helping people.  The people who live in our great cities all know one thing: they are interdependent.  People in these areas are specialized.  They work as doctors or lawyers or breadmakers or car salesmen. Very few, perhaps none of them, can be called self-sufficient and they know it. They know that a complex society can only be successful when all parts of the social system function efficiently. If one part of the system, let’s say the dentists, fall on hard times it will only be a matter of time before a lot of people begin to suffer from tooth aches. Similar problems arise if the bus drivers or the rubbish collectors or the school teachers encounter severe problems – the society needs all of these to function efficiently – and the Democratic Party is oriented towards helping social groups to succeed.

On the other hand, the Republican Party has chosen to make itself the party of the rugged individualist. The rancher, the farmer, the business owner, people who have to be self-sufficient or nearly so are the targets of the Republican Party. People who live far from the centers of society and have no opportunity to partake of the social programs in the cities are drawn to the Republican message of self-sufficiency.  One of the problems the Republican’s face is that this group naturally also contains the lunatic fringe, the self-absorbed, the isolationists, and the paranoid.  It also contains the misanthropes, the extremely greedy, and the ultra-wealthy, self-absorbed, self-appointed aristocracy of America who have little use for the common people or the laws of the land, which are clearly written for the peons to follow and not them.  The Republican Party has become an odd group of followers of  Limbaugh and Beck, O’Reilly and Palin, McCain and Bachmann. But what is their message? Is there anything that this menagerie actually stands for?  Or is it just the Party of “NO!”?

Clearly, the “NO” aspect of the Party is easy to see.  It seems they are routinely against anything the Democrats propose – sight unseen. If it’s a Democratic proposal they don’t want it – period. OK.  So what are they for? It seems that what they want is less government control of everything.  They want to be left alone. They can take care of themselves and they don’t want their taxes raised – they want them lowered, preferably to zero.  The rugged individualists of the Republican Party just want to be left alone.  This, of course, is especially true of those rugged financial individualists who contrived with George Bush (and by the way Bill Clinton bears responsibility for this too) for the dismantling of the financial controls that had been in place since the Great Depression. This great dismantling was a direct contributor to the screaming nose dive our economy took under President Bush.

Today, and day after day, we hear the Republicans say, over and over again, “NO!”  They are against everything President Obama wants to do.  The thing is this: the demographics of this country are changing. Fewer and fewer people are living independently on farms and ranches. Not everyone can own a small business.  Not everyone can be a stock market tycoon or a brain surgeon or a doctor.  Most people are average (by definition, I suppose) and they get average jobs and live in average places – which has become the northeast and the west coast.  In other words, the Republican base is shrinking and will continue to shrink, and as it shrinks it will become more shrill and thus the Republican message will become more shrill – but this shrill message can’t attract converts from the Democratic Party.  There lies the problem. The Republican train is headed for a wreck – anyone can see it if they just open their eyes.  Their message of “leave me alone” appeals to fewer and fewer as our population grows and becomes more and more interdependent.  The real problem for the Republicans is that the Republican train is currently being driven by some very odd people who have no business driving trains and who have no idea they are headed for a glorious wreck.

The crash is coming.  It’s just a matter of time. It’ll be a huge train wreck, just wait and see.

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It is as if Wall Street were an economic black hole that is inexorably drawing in the rest of the world’s economies only to be ripped apart and then crushed under the massive weight of unpayable debts and then dissolved into nothing but wavering wisps of smoky rings that will forever orbit this yawning abyss of melting gold.

Today, there have been stock market sell offs worldwide. Iceland’s economy is on the brink of total collapse.  What will tomorrow bring?  Who will be next?  Can there be any escape from the relentless, immense gravity of Wall Street’s implosion? Will history repeat itself? Is this the beginning of a 1929 style disaster? Is another Great Depression waiting for us?  It’s good to know that Goldman Sachs and Morgan Stanley have been saved, anyway.  I was worried about them…

If that’s not enough, John McCain and Sarah Palin have just reached a new low that even I thought would be unattainable. I guess I underestimated them.  I’m just not cynical enough.  I’ll have to work on that.  Today, Sarah Airhead launched the Republican Party’s attempt to smear Barack Obama with the most tenuous of associations with Bill Ayers, a 1960’s radical.  At first glance I thought she can’t be serious; then I remembered that this is Miss Hockey Puck from Alaska, and she probably is serious.  Here we are in the midst the what may become the greatest economic crisis since 1929, and perhaps the worst ever in the history of the world, and she goes off trying to draw some kind of insane association between Barack Obama and terrorism.

For someone who calls herself a “Christian” she certainly has a breathtaking capacity for deception.  Has she no morals or conscience at all?  How is it that she completely ignores the fact that she, herself,  is currently under investigation by the State of Alaska for corruption, and so far “stonewalling” has been her only defense? “Sinless” Sarah has just thrown the first stone, and now the Obama campaign is striking back with a hammer blow.  They are issuing a video that documents how John McCain was investigated by the Senate for corruption and, while he was eventually found not guilty, he was sternly reprimanded by the Senate Ethics Committee for his poor judgment.  It seems to me there is far more to suspect in the backgrounds of both Sarah Palin and John McCain than there is in Barack Obama’s. Yet that doesn’t deter Miss Airhead does it? I guess I shouldn’t expect her to make logical conclusions when she can’t even speak a coherent sentence in English…

Wait!!  I know!!  Maybe English is not her native language!! I should have thought of that…I wonder what language native Wasillians do speak up there while they sit on their back porches keeping their doggone eyes on the Russians and Canadians for us? Do you think her native language might be Tlingit or maybe Eskimo?  Could she actually be a Moose Whisperer?  I guess I should have been more understanding about her handicap.

By the way, here’s some good news you may not have heard: did you hear that the U.S. Army has just created a new Afrika Korps? OK, they’re not really calling it the Afrika Korps. After all, we’re not Nazis are we? They’re calling it the African Command. Doesn’t that sound a lot better? The Pentagon says that Africa is becoming more important to the U.S. now and we need to be prepared for coordinated military action in Africa. I guess they’ll be telling us how we are going to save the African people from themselves, just like we do all over the world.  If I were the cynical type, I might wonder if this portends another giant move by that great benefactor of the global economy, the American businessman. As I see it, with all this economic meltdown going on, the Chinese government is probably getting a little tired of us cowboys.  After all, we can’t fool them forever.  So – It’s to the South now for us!  South to Africa!!

Africa is the last best place on Earth that has a large potential labor force that our multinational businesses can exploit and make huge profits if we just build some factories there.  We can probably get a lot of the African people to work for pennies a day making all sorts of items that can then be sold in the U.S. at enormous profits. Hey, it’s good for Africa and it’s good for the American peasants, uh, I mean people, too!  We won’t mention that the owners of these multinational companies will make immense fortunes – I mean, really – isn’t that understood?  It’s the new global economy and everybody benefits!!

We should all be thankful that some of our very richest citizens, indeed they are among the wealthiest people in the world, have recently seen the light and are now, purely out of the goodness of their hearts, striving to prevent the children of Africa from dying of malaria.  And now, even our President Bush has been doing as much as he can to eradicate AIDS in Africa.  Africa will soon have a strong, healthy, and growing population; coincidentally, it’s all happening just about the same time we start building our clothing factories.  Thank God, for the American upper class. At last, they are finally taking up what Rudyard Kipling so poignantly termed “The White Man’s burden”.

I can’t see Russia from my back porch, but deep in my heart, I know that all is well in the world again today.

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I suppose his standing in class at Annapolis should have been the tip off.  Almost dead last in a class of nearly 900 graduates, you can’t expect him to have too much intellectual horsepower.  Still he presents himself as a man who is sure of his convictions, a man who is unafraid of risks, a man who will go where no man has gone before, and then he changes his mind – all the time. I mean, really, does anyone actually know what John McCain stands for?  Other than making the wealthy people of this country even more wealthy, is there anything else? Anything at all? OK, I suppose a few examples are in order just to make my point.

Let’s take financial regulation. During his long career in the U.S. Senate, McCain has consistently supported deregulation of just about everything on Wall Street. His financial hero and adviser is Phil Gramm who introduced legislation that successfully repealed the financial protections that had been created, during the Great Depression, to protect us from the shenanigans of the big Wall Street banks . Now that our economy is collapsing, due to the Republican-created, elimination of regulations for Wall Street, John McCain is complaining that there isn’t enough regulation and is calling for “tougher rules on Wall Street”!

Let’s talk about Iraq for a minute.  Remember the whole issue about having a timetable to withdraw from Iraq? Remember when he said he was willing to stay in Iraq for 100 years? Then Barack Obama came up with a plan for withdrawal in sixteen months. Remember that? After Iraq officials said they wanted to do something like what Obama was saying, McCain said it sounded like a “pretty good timetable”.

Long ago, John McCain supported the moratorium on offshore drilling.  Almost everyone did because everyone knew that enormous damage had been done to our environment by previous oil spills and that the potential reward for offshore drilling was not worth the potential risk. Then as soon as oil prices go up, he completely changes his tune.  Now his mantra is DRILL NOW! (I’m not 100% sure about this. I haven’t actually heard him say it in the last few days, so it could be that he’s now against drilling.)

There is a long list of McCain’s breathtaking reversals on just about any topic you can imagine at the Carpetbagger Report .  It’s pretty depressing because it indicates that he doesn’t have any clear idea of where he is going, and he doesn’t have any identifiable guiding philosophy in his life. He claims he is a maverick because nobody can count on his allegiance. I guess that’s not too surprising, but I think a more accurate term (and maybe a more nautical one that his buddies in the Navy are more familiar with) is “loose cannon”.

Putting aside, for the moment, that he has tried to co-opt Barack Obama’s slogan of “Change”, recall his slogan of only a few weeks ago, during the Republican Party convention. That slogan “du jour” apparently was “Country First”.  Not a bad slogan, I guess. It certainly sounds patriotic and makes us think that the most important thing for McCain is his country. Right? OK, well, then he goes and chooses Sarah Palin as his running mate.  I don’t think there is any need for me to go into the almost limitless number of reasons why this is a really, really, bad decision, but let me just discuss one. What if McCain were elected and, heaven forbid, he died in office a week later. It could happen – William Henry Harrison, ninth President of the U.S., became ill after giving his inauguration speech and died a month later.  That’s why we have Vice Presidents. They are there, primarily, in case something happens to the President.  So can you imagine Sarah Palin becoming President of the U.S. in February 2009? She would be President for the next four years. Seriously, is that “Country First”?

Just how much does McCain actually care about America to be so utterly irresponsible as to put Sarah Palin in such a position. That decision may be a lot of things, but it is certainly not “Country First”. There are so many reasons that Sarah would be a disaster as President, but they are all summed up in the brilliant Saturday Night Live parody . I suppose almost everyone has seen it, but if you are the one who hasn’t, take a look at it, you’ll see what I mean. What else could I possibly say to prove my point about Sarah?

But this election is not about Sarah, it’s about a choice between John McCain and Barack Obama.  This is a time when our country’s economy is being challenged by an economic meltdown that compares only to the meltdown that preceded the Great Depression, and John McCain has already admitted that he “doesn’t really understand economics“.  This is a time when we face significant challenges in the Middle East, and yet, a couple of weeks ago hot-headed McCain goes looking for trouble with Russia saying “We are all Georgians.” I’m not a Georgian, and I don’t want to be.  I don’t care what happens between the Georgians and the South Ossetians, do you?  Let them settle their own problems.  What is this man thinking? And that is my point. John McCain is an intellectual lightweight. He has, time and again, adopted  any position on any subject for any reason at any moment.

Far from having built his foundation on a rock, he stands on shifting sands, loyal to no one, undependable for more that a moment at a time, mercurial in his alliances, and, in the end, nothing more than a falling leaf, blowing in the wind.

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24 hours ago, John McCain said the fundamentals of our economy are sound. Today he said our economy is in a crisis. Whew! I guess a lot happened in 24 hours!  Johnny now says he wants to set up a commission when he gets to be President, sort of like the 9/11 commission, to try to figure out why the wheels flew off our economy.  I wonder what Sarah would do if she were President? Would she invoke the Bush Doctrine and save us all? The question I have is this: what happened to their answer of just a couple of weeks ago?  Remember their battle cry of DRILL BABY DRILL? How come we don’t hear it anymore? And they were so sure too!  Am I to now assume that “DRILL NOW” isn’t the solution to Wall Street’s catastrophic meltdown after all? I’m truly shattered, Johnny and Sarah.  I…I…I don’t know what to say. I’m so disillusioned!!!

I guess we won’t be hearing any answers from Johnny and Sarah for a while, at least not until they are inaugurated in January; so I thought, meanwhile, I would take a stab at solving the world’s or at least the U.S.’s economic problems while we are waiting for enlightenment from above (meaning Johnny and Sarah, of course).  With apologies to Alan Greenspan and all the other economic professionals who no doubt know tons more than I do about economics and who surely know the answer to our problem but are, for some reason, keeping quiet about it, here goes:

There are two basic types of economies, those that are stable (we’ll call those type 1) and those that are not (we’ll call those type 2).  Guess which type we have? Right. Type 2. By the way type 2 economies are not good because they don’t last and they always end in disaster. Type 1 economies are good because everybody benefits and they just go on and on. That’s the type we should be aiming for. Here’s a real simple example of a type 1 economy: Let’s assume that I have a small farm where I grow peas and you live across the street and you also have a small farm, but you grow corn. I get tired of eating only peas and you get tired of eating only corn, so we agree to trade with each other and before you know it, we’re both eating peas and corn. We could do this for a long time, until, I guess we get tired of just eating peas and corn and we turn to Fred who is a fisherman. You and I both like fish and we decide to trade with Fred for his fish, but Fred only likes spinach. However, he knows this guy who grows spinach who would like to get some peas and corn. Suddenly this starts to get complicated so we invent money. One buck is equal to a bucket of peas, a bucket of corn, or a bucket of fish. (That’s why it’s called a “buck”). Pretty soon we’re all eating whatever we like and money flows around and everybody is happy. We can do this forever. This is a stable type 1 economy and it works because it relies on fair value for goods and people all producing something that the others want and the things they produce are renewable for the foreseeable future. The essence of a type 1 economy is that it is circular and closed. The money and goods all circulate throughout the economy.

Type 2 economies are different. These are non-circular, open loop systems that succeed for short periods of time because they exploit one of the parties in the system. Type 2 systems fail when, for one reason or another, the exploitation cannot be continued or one party winds up with all the resources and doesn’t need the others. For example: take the U.S. economy in the 18th Century. This was fundamentally an economy based upon agriculture. Vast amounts of land were available for farming, but machines, like tractors, hadn’t been invented so a single farmer couldn’t really farm all the land he owned. So, the farmers went out and got slaves from Africa to farm the land. By exploiting the slaves the farmers made lots of money.

Then the industrial revolution came along with all its machines and everyone suddenly realized that slavery was evil and they fought the Civil War to end that injustice. Then the rich people built mills to make textiles and shoes and steel and all sorts of stuff. They hired cheap labor, children, women, anyone who would work for next to nothing to work twelve hours a day in the mills, and the mills turned out tons of stuff that the owners sold to everybody and they got really, really rich.

But those uppity people in the north started wanting to get paid more money for working in the mills so the owners moved the mills to the south where people, especially the children of the former slaves, would work really cheap. And the rich mill owners made lots and lots of money. The people up north had to figure out other ways to make money and began making things that the rich people wanted like cars and televisions. Eventually the people down south wanted more money for working in the mills so the owners shut them down and moved them to Mexico and China and India where they could exploit the cheap labor market and continue making fortunes.

This is sort of where the wheels really started to wobble. That’s because the Americans, who were making money in the industries that still remained here, began buying the stuff they needed from stores like Wal-Mart who sold stuff that was made in China. So, U.S. money flowed to China and shirts and jeans came into the U.S. Next thing you know the same thing was happening with televisions and cars. Pretty soon a trend developed – money left the U.S. and stuff we bought came into the U.S. (Notice how unbalanced the economy had become. In a type 1 economy money and goods flow both ways, but in a type 2 economy it is not a circle and eventually it gets really unbalanced).

Fortunately, someone came up with the great idea of creating a housing pyramid scheme in the U.S.  In this plan you could borrow money to fix up, or even buy, a  house and then flip it. Soon everyone was making money hand over fist buying and selling houses to each other that they didn’t need and the U.S. economy took off in hyperdrive. Until finally it turned out that the banks actually expected to get paid for their toxic mortgages. That’s when the wheels came off, Johnny.  Because nobody could actually pay those obscene interest rates and people didn’t really have real jobs anyway (because all the real jobs had been outsourced to India and China and Costa Rica and Timbuktu). So the banks began imploding, and they turned to the government and cried a lot about it and asked why can’t the U.S. taxpayers pay for their losses?

Well, it’s safe to say it’s a real mess now. Money goes out of the U.S. and manufactured goods come in. Money flows out and stuff flows in. It had to end some time; the housing pyramid scheme just forestalled the inevitable crunching sound on Wall Street by about ten years.

The solution for our broken economy is to create a circular, type 1 economy. If we want to include the rest of the world and make it a global economy, fine, it just has to be a fair system where money and stuff flows both ways, pretty much equally. The thing is this: we can’t go back to our 18th Century agriculture based economy, and we can’t go back to our 19th/20th Century manufacturing economy. We need to create a new foundation for a type 1 American economy that can participate in a global economy without relying on exploitation.

As I see it, our best choice is to create a technological economy. This economy would be based upon the transformation of the U.S., and eventually the world economies, into systems that rely on technology, not machines, to do work. Electricity, probably made from nuclear power and maybe solar or wind too, but not fossil fuels would provide the power to do work.  We need to create a nationwide transportation system, including high speed railways, advanced automobiles, and maybe even aircraft, that are all electrically powered. The development of this electrically powered economy would create millions of high paying jobs, but the good thing is that the people who are creating this capability are also the consumers of the capability, i.e. we will have created a stable, circular, type 1 economy.

In order to take this step we need people of vision to lead the way and we need lots of money to invest in this transformation. The money part has to initially come from the government because businesses are too conservative to take a chance and invest the amount of money needed to get this going. It’s sort of like how the government invested all that money in NASA to go to the moon and in the process created thousands of new products and businesses.  Once the government has primed the pump, so to speak, business could take over, to a large extent, the task of building this new economy.

So, that’s how I see it.  We need to continue our long progression from the old agricultural economy and the old manufacturing economy to a new technological economy. There’s just one little detail I left out. In order to make this technological great leap forward we need really first class public schools. We need the best schools in the world and the smartest students in the world, because technology requires lots of brain power and we can’t begin to go there when our students rank about 20th or 30th in the world in test scores.

We also need to get past the short-sighted,  misguided efforts of Congress to drill our way out of this crisis. That is not the solution. Even John McCain isn’t talking about that anymore.  We need really smart people with vision in our government.  Otherwise, all we’ll be left with is trying to flip our houses to the Chinese.

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It is like the Titanic hitting an iceberg as the passengers peacefully sleep in their staterooms.  Deep in the bowels of the “unsinkable” liner the crew desperately tries to shore up the cracked bulkheads; the pumps strain to empty the sea water that is pouring in, while, far above in the ballroom, the band plays on.  Last night, while most of us slept, a shudder went through our ship of state, largely unnoticed by most Americans and hardly reported on “America’s most trusted name in news”.  Instead it was the New York Times that broke the story, just about midnight Friday – long after the stock market had closed – and long before it will open again on Monday.  Fannie Mae and Freddie Mac, the banks that underpin the entire U.S. mortgage industry are, for all intents and purposes bankrupt.

Fannie and Freddie buy mortgages from banks that issue them and then they turn around and resell a lot of them to other banks worldwide. However, it’s not an entirely pass-through operation.  Fannie and Freddie also insure these mortgages so that if the purchasers of houses default on their mortgages Fannie and Freddie promise to reimburse the bank. The banks don’t lose, they can’t lose – Fannie and Freddie absorb the loss.  Fannie and Freddie are quasi-government banks, set up by the government to help make sure people can get mortgage loans from banks by taking the risk away from the banks.  It has always been an implicit understanding that the U.S. government stands behind Fannie and Freddie, and that the mighty U.S. Treasury itself, with its semi-infinite supply of money will make sure that these two banks always have enough money to bail out the banks.

Now, despite Fannie and Freddie’s economic bailing pumps running full speed, they can’t keep up with the rate of Americans defaulting on their mortgages, even those with prime mortgages!  Our ship has taken on a noticeable list, our economic engine has stopped churning the waves, and in the darkness of night the rich people on the upper deck are heading to the lifeboat stations.  Deep within the hull, out of sight of everyone, metal scrapes on metal, men scream and drown, trapped in a doomed ship with no way to escape.  Far above, champagne glasses clink and the band plays on.

The value of Fannie and Freddie stock will now drop on Monday to zero as the government steps in and takes direct control of these banks.  Fannie and Freddie stock investors have lost everything, but that is only a small concern for our Captains of Money. The really scary thing is this: there are a bunch of mortgage loans out there in the process of defaulting and no one knows exactly how much they are worth. It could be a 100 billion dollars worth, maybe more, but that is only the amount of loans currently in default. There will, undoubtedly, be more.

So how bad can it get? What is the worst case scenario? Are you sure you really want to know? OK…  Between the two of them Fannie and Freddie guarantee about $5,000,000,000,000 (five trillion dollars) in mortgages; this is an amount slightly larger than half of entire U.S. national debt.  With the takeover of Fannie and Freddie by the U.S. government, the U.S. government will now assume this liability. And guess who is on the hook to pay off these liabilities? YOU are, that’s right, the U.S. taxpayer!  Yes, my friend, you are the lucky winner today.  Care for some champagne up on the poop-deck?

See those rich folk clambering into their first class lifeboats, the ones who own the banks that own the mortages? You now owe them five trillion dollars.  A lot of them pay less income tax than you do – do you want to know why? Think about it – who do you think writes the tax laws? Heh heh…

Hold on – Hold on – Here’s some BREAKING NEWS –  BREAKING NEWS coming in from the McCain Palin camp! They have just announced a solution to our desperate, sinking, financial situation: They’re saying “DRILL NOW!”  Yes, that’s it!  It has become a chant, taking on a life of its own.  They’re shouting now, “DRILL BABY DRILL! … WE ARE ALL GEORGIANS!!! …FIGHT WITH US!!!  ….STAND UP!!! ….STAND UP!!!”

The Champions of the Rich Folkare waving gaily at us now as they board their lifeboat, semi-hidden by showers of confetti and balloons.  Half the poor, misled, people on our ship are wildly cheering them, believing in their hearts that the solution to the gargantuan gash in our financial hull is cheaper gasoline and standing up to the Russians.

As our the stern of our ship rises up and out of the cold waves, it’s comforting to know that the U.S. banks, indeed investment banks worldwide, won’t lose a dime, even as we U.S. taxpayers drown in debt. The rich folk are in their lifeboats, the financial institutions of the world remain strong, taxes for the rich remain low or non-existent, and the poor and the very poor are huddled in steerage. All is well with the world as our ship begins its final plunge, but from somewhere deep within the recesses of the cold steel hull a redneck chant is rising and growing stronger, even as we slip beneath the waves…DRILL NOW…DRILL NOW…DRILL NOW….DRILL………..

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