Editorial: Obama Earns His Nobel

President Obama finally earned the Nobel Peace Prize he was given in 2009 and it’s driving Republicans crazy.

Secretary of State John Kerry also deserves credit for leading the 20 months of talks, along with representatives from Russia, China, Britain, France and Germany, getting Iranians to sign onto the deal to give up their pursuit of nuclear weapons and agreeing to allow UN inspectors to check their work. Now the challenge for Obama and Kerry is to get Congress to give peace a chance.

A solid majority of Americans support the agreement; a poll for the Washington Post and ABC News (July 20) showed 56% in favor and 37% opposed. While Republicans hope to make inroads into the Jewish vote, a poll conducted in June for J Street, a progressive Jewish group, found that 59% of American Jews support a final agreement with Iran that increases inspections in exchange for economic sanctions relief. And Jewish support grows to 78% for an agreement that imposes intrusive inspections of Iran and caps its enrichment of uranium as a level far below what is necessary to make a nuclear weapon in exchange for phased relief from US and international sanctions, as the final deal does.

However, Israeli Prime Minister Benjamin Netanyahu remains implacably opposed to the Iran deal. The leading Israel lobby group, AIPAC, is expecting to spend as much as $40 million on an ad campaign through the cover group “Citizens for a Nuclear Free Iran” to put pressure on Democratic members of Congress to nullify Obama’s policy.

Many former senior intelligence and national security officials in Israel disagree with Netanyahu and believe the historic agreement is in the national security interest of the State of Israel.

Jonathan Alter in TheDailyBeast.com (July 21), quoted Ami Ayalon, a former head of Shin Bet, the Israeli internal security service, and a former chief of the Israeli Navy, saying the issue “‘is not black and white,” but he reeled off a list of former defense ministers and chiefs of Shin Bet and Mossad who agree with him that “when it comes to Iran’s nuclear capability, this [deal] is the best option.”

Jeremy Ben-Ami of J Street told the Washington Post the battle shapes up as “The foreign policy fight of a generation… It pits folks who brought us the Iraq war and whole neocon worldview versus the Obama worldview and the concept that we can confront enemies with diplomacy.”

Israel’s allies against the deal include military contractors who would profit from war with Iran and oil companies, who lost billions of dollars in the value of oil reserves after the UN Security Council unanimously approved the deal on July 20. Crude oil prices fell below $50 a barrel for the first time in more than three months on speculation that Iran will add to the global glut of oil.

While some oil companies hope to move in to help Iran rev up its production, others see the infusion of Iranian oil blotting out their hopes of returning to $100-a-barrel oil anytime soon.

Relaxation of sanctions on Iran not only will allow Iranians to improve their standard of living and potentially increase exposure of young Iranians to Western influences; reopening oil markets will help keep gas bills low for American drivers.

If Congress overrides Obama’s veto and kills the deal, no one seriously disputes that the sanctions regime would collapse. “Russia is already planning its new business deals with Iran and the Europeans aren’t far behind,” Alter noted. “The idea that a tougher United States could by itself force better terms is a dangerous fantasy. With rejection, we would get the worst of both worlds. Iran would have much of its oil money back, but without the most intrusive inspections in history (24/7 monitoring of its nuclear facilities), 98% reductions in uranium stockpiles, and the many other provisions that sharply reduce its existential threat to Israel.”

If Israel and the Republicans risk a war full of unintended consequences to eliminate Iran’s nuclear capacity, Israeli intelligence estimates that US bunker-buster bombs would at best set back Iran’s nuclear program by two to four years, or roughly a fifth as long as required by the terms of the new deal, Ayalon said.

As for Israeli security concerns, the predominantly Jewish nation has at least 10 years to demonstrate that it is not a threat to Iran, which has no inherent enmity for Israel, beyond its concern for fellow Muslims in Palestine. Jewish communities in Iran date back to Biblical Persia. From the establishment of the State of Israel in 1948 until the fall of the Shah in 1979, Israel and Iran maintained close ties and Israel viewed Iran as a natural ally as a non-Arab power on the edge of the Arab world.

Relations suffered after Ayatollah Khomeini overthrew the Shah, but Israel still provided logistical support and sold arms to the Islamic Republic during Iran’s war with Iraq from 1980 to 1989. Hostility between Israel and Iran increased after the defeat of the Iraqi army during the first Gulf War in 1991.

The best way Israel could improve its security is to jettison Netanyahu, explore the opening to re-establish diplomatic relations with Iran and start negotiating seriously with duly elected Palestinians to recognize each others’ authorities.

US Isn’t Greece

There are many lessons to be learned from Greece’s struggles to get its economy back on track, but debt hawks are wrong to claim that the Greek troubles should stand as a warning that the US is in trouble because of its mounting national debt.

Greece’s problem is that it does not control its own economy, being beholden to the Frankfurt-based European Central Bank, which administers monetary policy for the Eurozone. Greece also has a problem in getting revenues from wealthy citizens who for generations have dodged tax collectors.

Greece owed official lenders $271 billion in June, while private investors also held $42 billion of Greek government bonds. That compares with a GDP of $238 billion in 2014, which ranks 45th in the world and 13th in the 28-member European Union.

The United States expects a national debt of $18.6 trillion at the end of FY 2015, compared with a $17.4 trillion GDP in 2014, which makes the US the biggest economy in the world.

But Greece, which was required by the ECB and IMF in 2010 to adopt austerity measures to bring the deficit under control, saw its unemployment rise from 11.9% of the workforce in 2010 to 27.5% in 2013 before falling to 25.5% in April.

The US, on the other hand, saw its economy recover after President Obama and the Democratic Congress stimulated the economy with $800 billion in spending in 2009 to pull the country out of the Bush Recession. Republicans have tried to impose austerity measures in an effort to stall the economic recovery and they have succeeded in cutting government jobs and programs since they took over the House in 2010 and the Senate in 2014, but the unemployment rate still dropped to 5.3% in June.

US Treasury bills are still considered the safest investment in the world, with interest rates ranging from 0.04% for three-month notes to 2.33% for 10-year notes because, unlike in Greece—whose 10-year bond rate was 11.22% on July 20—there is no serious question that the US can pay off its debts. The biggest threat to the T-bill’s stability is the Republican majority in Congress, which threatens to default on the debt if President Obama does not agree to further austerity measures when the next debt-ceiling fight comes up in November.

Who gains from higher government bond rates? Hedge fund speculators, who have complained that T-bills have been low-performing under Obama. Some invested in Greek government bonds when they were yielding upwards of 12%, betting that the ECB and the International Monetary Fund would backstop them.

Beware of Republicans who again are threatening a government shutdown, which will hurt government workers and the people who rely on them to provide services—who tend to be at lower income levels—but might nudge up T-bill rates as a favor for the Wall Street speculators. — JMC

From The Progressive Populist, August 15, 2015

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Selections from the August 15, 2015 issue

COVER/Roger Bybee
4 bad things Scott Walker did in Wisconsin

EDITORIAL
Obama earns his Nobel; US isn’t Greece

LETTERS TO THE EDITOR

DON ROLLINS
Big Pharma decides who lives and who dies

RURAL ROUTES/Margot McMillen
Those who remember the Civil War fondly

DISPATCHES
Kasich joins the fray;
GOP selective on vets’ feelings;
Clinton loses ground, Sanders competitive in swing states;
Racial justice is hard;
GOP faces Latino gap;
Medicare, Medicaid still hugely popular;
Beware butt-dial;
How many unarmed people do police shoot?;
Immigrants less likely criminals;
More states sign onto Medicaid expansion;
Small business lending program nears cap;
Embargo still bans business in Cuba ...

MIKE LUX
Wall Street, Kochs and progressive alternative

GRASSROOTS/Hank Kalet
Trump, sadly, is no sideshow

BOB BURNETT
Is the Culture War over? 

RAUL A. REYES  
Trump’s badmouthing deportment

SIMON MALOY
Iran deal gives Dems opening (if they’ll seize it)

HEALTH CARE/Joan Retsinas
Yelping for a doctor

SAM URETSKY
Walker messing Wisconsin only the beginning

WAYNE O’LEARY
The world according to Brooks

JOHN BUELL
Trashing Greece — and Europe?

JOHN YOUNG
Captives of commerce in a shooting gallery

SETH SANDRONSKY
Clocking in for justice

DONALD KAUL
Smashing the Austerity Idols

and more ...

OpEdge Redux: Moving in retirement to avoid school taxes is the epitome of the politics of selfishness

By Marc Jampole

While OpEdge is on a two-week hiatus, we are running some of the more evergreen columns from past years. This blog entry originally appeared on September 19, 2013.

Last time we cited Tom Sightings, self-proclaimed retirement expert, he was conjuring images of the various dream retirements to which he assumed the American public might aspire.  His catalogue of utopias reflected the pro-suburban ideology that dominates the mass media: golf communities, small university towns, beach fronts and suburban houses. Not one of Sighting’s dream retirements involved living in a city with great mass transit, an abundance of public spaces, cultural activities and entertainment, top-rated healthcare systems, the exciting buzz of cultural diversity and tremendous resources for seniors. In Sightings’ world, cities just don’t exist.

The latest view from Sightings highlights an ideological principle that has dominated U.S. public discourse since the election of Ronald Regan in 1980: the politics of selfishness, the idea that everyone should pursue his or her own private agenda, no matter how harmful it might be to others or to the community at large. Symbolic of the politics of selfishness is Reagan’s favorite joke about not having to outrun a bear, just one’s companion (who will then get ripped to shreds by the bear).  

Sightings doesn’t come out and explicitly say, “Care only about yourself” in his recent U.S. News & World Report article.  What he proposes, in a soft-shoe, gently prodding kind of way, is that retired people move out of their communities to avoid paying high school taxes. 

After all, their kids have long graduated from high school, so who cares about the next generation!

Sightings employs the increasingly irritating rhetorical device of building the story around himself (the writer) and his situation. The article begins when he receives the school tax bill which has increased by four percent. He grumbles that his income has not increased by that much.  Continuing the article as a first person narration, Sightings tells us of a dinner his wife and he shared a few days later with a couple who had just moved to a new town to avoid high school taxes.  Sightings quotes the husband: “Who needs to pay those high school taxes, he ventured, when your kids are grown up and gone away?” Sightings continues: “Left unsaid was the other question: Who can afford those school taxes when you're no longer pulling in a paycheck, and instead living on a fixed income?”

After some wishy-washy discussion of the pros and cons of moving to avoid school taxes and a spackling of information about states that reduce property taxes for seniors, Sightings ends the column fully on the side of moving: “But then I see that school tax bill sitting over there on the corner of my desk. It's due by the end of September. And our youngest child graduated from the local school system four years ago. Maybe it's time to start looking for our place in the sun, after all.”

What Sightings doesn’t see, or doesn’t want to see, is that when he sent his children to school, large numbers of his fellow townspeople were paying property taxes to fund public schools who had already sent their children through schools and many more who hadn’t had children yet or never were going to have any. Even parents who sent their children to private schools contributed to educating Sightings’ children. Now it’s his turn and he wants selfishly to shrug his responsibility.  After all, he got his.

There are many great reasons to move in retirement: to be near grown children or to live one’s dream, be it on a quiet shore or in a high rise co-op overlooking the hustle and bustle of Manhattan. “Chacun sa chimère,” as Baudelaire once said (which translates into “To each, his or her illusion.”) It’s also true that some people move to smaller homes in retirement or are forced to move to cut expenses.

But to move just to avoid taxes is as anti-social as robbing a convenience store or embezzling from a nonprofit organization. 

OpEdge Redux: New book shows that poverty affects brain and makes it harder to think, work, learn

By Marc Jampole

While OpEdge is on a two-week hiatus, we are running some of the more evergreen columns from past years. This blog entry originally appeared on September 15, 2013.

Thanks to Cass Sunstein for reviewing Scarcity: Why Having Too Little Means So Much in the latest New York Review of Books. In Scarcity, Sendhil Mullainathan and Eldar Shafir collect and analyze an impressive amount of research to demonstrate that those who suffer a scarcity of a resource—say food or money—dedicate more of their brain to addressing that scarcity, thereby degrading their ability to attend to their daily tasks, in school or on the job. 

According to Mullainathan and Shafir, scarcity “puts people in a kind of cognitive tunnel, limiting what they are able to see. It depletes their self-control. It makes them more impulsive and sometimes a bit dumb. What we often consider a part of people’s basic character—an inability to learn, a propensity to anger or impatience—may well be a product of their feeling of scarcity,” to quote Sunstein. The book cites a ton of empirical research that shows that the effects of scarcity cut across all possible types of scarcity. 

The most striking study mentioned in the review tested Indian sugar cane workers before the harvest when they were broke and after the harvest when they had lots of money. The difference in scores amounted to 9 or 10 points on an I.Q. test, which measures certain intellectual capabilities correlated with success in school and in professional employment.  On an I.Q. test, ten points means a lot: for example, about 28% of the population scores between 106-115, while only 9% of the population scores between 116-125.

In other words, not only do rich and upper middle class children have the advantages of classes and lessons, summer camps, trips abroad, private tutors, SAT prep courses and the doors that money and business contacts can offer. The wealthy also have an inherent advantage in that their brains are not drained by scarcity concerns as the brains of poor children are.  The easiest way to improve our educational system would be to end poverty, which would enable formerly poor children to focus their brain on learning and not on the anxiety of not knowing when the next meal will be.

A few years back, the mainstream media and politicians were completely enamored by an article titled “Growth in a Time of Debt” by Carmen Reinhart and Kenneth Rogoff, which concluded that countries with public debt greater than 90 percent of GDP suffered measurably slower economic growth. In This Time Is Different, the two right-wing economists ostensibly fleshed out the theory with examples across the centuries.  Mainstream politicians and journalists throughout the world embraced this “new discovery,” using it to bolster assertions that we had to deal with the debt instead of pumping money into the economy.

The problem was that Reinhart and Rogoff miscalculated in a number of places and even made typographical errors. When their bad math was corrected, it was found that there was no correlation between levels of debt and economic growth.

Many people wanted to believe Reinhart and Rogoff were right because they wanted to cut the budget, regardless of the pain and the economic havoc it caused. Of course it didn’t work out—Europe’s austerity program backfired and the U.S. limited “rescue” of its economy produced uneven and weak results. Through it all, inequality continued to grow, especially in the United States. The distribution of wealth in this country is now lessequitable than it has been in more than in a century. 

As of this writing, a Google key word search yields about 3,000 mentions of Scarcity, which is not even a drop in the ocean of web pages floating around cyberspace.  It’s still too early to tell, but I’m betting the mainstream news media is going to ignore Scarcity for the most part and few politicians outside maybe Bill De Blasio will reference it. 

But imagine if Scarcity captured the imagination of politicians and pundits the way that Reinhart & Rogoff’s bogus research did, or the way Michael Harrington’s poignant expose of poverty, The Other America, did in the early 1960’s?

What if our various governments started to create public policies and new laws to address the implications of Scarcity: Why Having Too Little Means So Much? If Scarcity is true (and the Sunstein’s extensive review makes we want to read it as soon as I can), that puts a while new light on Republican efforts to decrease funding for food stamps and unemployment benefits. The very nature of poverty distorts and weakens the thinking process, so that once people fall into poverty it is very hard to escape.  It makes sense then to be as generous as possible with these benefits in times of economic distress, to keep as many people out of poverty as possible.

Widespread knowledge of the findings by Mullainathan and Shafir would lean the debate over minimum wage and health care decidedly to the left, as think tank pundits and government policy makers quoted the book to assert the need to protect Americans from the negative effect of scarcity in general, and of medical care in particular.

Scarcity also serves as an epiphany for the great challenge facing the United States in the area of education. Rich people are spending more to educate their children while their state and federal representatives continue to cut budgets for public schools.  Meanwhile, a college education has become a major drain on the finances of most families.  Equal opportunity movements focused on voting and jobs in the 20th century. In the 21st century, the real battle ground for equal opportunity may be over education. 

For the past 30 years, we have passed laws and followed policies that increase the number of people facing scarcities of money, food, health care and now education. We have in effect degraded our intellectual stock by putting more panic into more people.  Creating a more unequal society has weakened our collective ability to learn and to work. If our leaders believed the message of Scarcity they would pursue an entirely different set of policies that would resemble the policies our nation pursued in the 1950’s, 1960’s and early 1970’s. You know, when we had general prosperity, a lower rate of poverty, a more equal distribution of the wealth, strong unions, mostly great public schools—and, not coincidentally, much higher taxes on the wealthy.

Tissue Thin Diplomas

Art by Kevin Kreneck

OpEdge Redux: Oreos decides that a “Sesame Street” approach will sell cookies to adults

By Marc Jampole

While OpEdge is on a two-week hiatus, we are running some of the more evergreen columns from past years. This blog entry originally appeared on May 13, 2013.

Adults read the New York Times.

While the Times does not release readership demographics segmented by age, it lets potential advertisers know that the median age of its readers is 52, meaning that exactly half of all readers are older than 52. By the way, that’s about 15 years older than the U.S. median age of 37.1.  The Times also tells us that 60% of its readers have gone to college. Very few children age 12 or under are academically gifted enough to handle college and among those 12 year olds who can do college work, a miniscule number who are have parents who send them.

We can assume that any advertiser in the New York Times understands these demographics and is seeking to convince adults to buy its products or services. A full-page ad in the Times does not target children. 

That makes the Oreo ad on the back page of the front section of today’s New York Times perhaps the most overt example ever of infantilization of American adults, the process by which American retailers and the mass media encourage adults to retain their immature or juvenile hobbies and entertainment habits of their childhood.

Oreo is the bakery product created by squeezing a thick sugar-water paste that Nabisco, its maker, calls “creme” between two round chocolate cookies.  For decades it has been one of the most, if not the most popular packaged cookie in the United States, and certainly the most advertised.

Today, Oreo spent tens of thousands of dollars to give New York Times readers a multi-panel cartoon version of a music video that can be found at its website. The video visualizes a peppy children’s song with animation, language and colors associated with pre-school education to re-imagine three tales: the three pigs plus generalized myths about vampires and great white sharks. Each story—and each verse of the song, which is sung with the child-like and child-loving joy of Raffi or Sherry Lewis—starts with the phrase “I wonder if I gave an Oreo to…”: first to the big bad wolf, then to a vampire and then to a shark. In all cases, the harmless-looking villains share the Oreo with their intended victims (pigs, a girl and baby seals) and everyone becomes friends.

Every element of style in sound, visuals or language in the video has been used before and almost always to communicate specifically to children. The same can be said for the print ad—every visual and language detail tells us that the ad is meant for children. The ad comes with a child’s mentality. It presents the colorful and happy world we often present to children. The primitive illustrations with the varying size of letters define a convention of children’s book design.  The basic idea—Oreos can bring make nasty people behave in a friendly manner—has the magical simplicity of a preschool child’s reasoning. There is no attempt to speak through the child to the parent. The ad simply speaks to children, mostly those under the age of eight.

But the audience who will see the ad in the Times is overwhelmingly adult. Oreos must think that this puerile approach will appeal to adults.

Oreos has broadcast series of TV commercials appealing to adults over the past few years.  In one, a father and son eat Oreos in the traditional way of licking the “creme" before devouring the cookies.  The TV spot may appeal to nostalgia for childhood—eat Oreos just like you used to as a kid—but it does so in an adult way: connect with your child by eating one of your favorite treats from childhood.  In another Oreo ad for adults, two slacker-looking 20-something males in a lifeboat on the ocean argue about the proper way to eat an Oreo. Humor for both children and adults can turn on the incongruous, but the situation is sophisticated enough to qualify as for adults.

By contrast, the “I wonder if I gave an Oreo…” print ad and online video treat the audience as children.  Publishing the print ad in adult media therefore infantilizes adults because it assumes that adults will respond to the same simple stimuli that attracts preschoolers.  If we assume that Nabisco has the best market research available, there must be a body of information that says that this approach will work. Nabisco is speaking to adults as if they were children because its marketing executives think we are children and respond to children’s entertainment.

I can just imagine that it’s bedtime and the chief executive officer of Nabisco brings me and my significant other a plate of Oreos and big glasses of milk.  We crunch on the cookies and sip from our plastic cups, while he gently reads us a bedtime story about the three pigs. No huffing and puffing, though, which is a good thing, since now I won’t have a nightmare about wolves (or vampires).  They really are our friends, at least as long as we keep feeding them Oreos.  I wonder if eating Oreos can reverse global warming?

Nighty-night.

OpEdge Redux: None of the four arguments against gun control make any sense when you analyze them

By Marc Jampole

While OpEdge is on a two-week hiatus, we are running some of the more evergreen columns from past years. This blog entry originally appeared on December 19, 2012.

Through the years, I have read and heard four basic arguments by those who oppose gun control. Those who favor making it easier for people to buy and carry guns repeat these arguments with an almost religious fever, as if the incontrovertible logic of their statements trumps all other facts and reasoning. But careful examination shows that each of these arguments is illogical or non-factual or both.

Let’s examine the four arguments against control one at a time.

#1 The Second Amendment forbids gun control.

The second amendment states, “A well regulated militia being necessary to the security of a free state, the right of the people to keep and bear arms shall not be infringed.”  The key words are “well-regulated” and “infringed”:

·         Well-regulated: The amendment clearly says that the reason to allow people to keep and bear arms is to have a well-regulated militia, and regulated means rules, laws and control. You are allowed to have arms so you can be part of the militia and the militia can be regulated. Thus you and your weapons (arms) can be regulated. 

·         Infringed: Infringed is a mighty broad word, and many constitutional lawyers could drive a truck through the leeway it gives to regulate.

The interpretation of all of the Constitution through the years by both the right and the left demonstrates that our society understands that the document is not rigid, but pliable to the point that you can twist it into anything. While the Second Amendment unfortunately seems to clearly state that people do have the right to own guns, the amendment per se and as part of a document that has been stretched in every direction has nothing in it that prevents as much gun control as is necessary to keep order and safety, which is, of course, the primary job of a well-regulated militia.

I asked my cousin, Marshall Dayan, a renowned death penalty attorney who often deals with constitutional issues, for his view of the Second Amendment and here is what he wrote: “I would take issue (though Alito and the SCOTUS would not) that the Amendment clearly states the right to individual handgun ownership. It refers to the right of THE people, not the right of PEOPLE, so I read that to be a communal right, not an individual right. Hence, if AS A PEOPLE, we chose to keep arms in an armory for the purpose of maintaining a well-regulated militia, I don't think the federal government could preclude that under the 2nd Amendment by its terms. But I don't think a reference to the right of THE PEOPLE is the same as the right of individuals to keep and bear arms. But my interpretation is, at least for now, mooted by U.S. v. Heller and McDonald v. Chicago.”  FYI, Jeffrey Tobin makes the same argument as Marshall in The New Yorker.

Of course, a simplistic and somewhat snider approach is to say that the amendment refers to firearms and not ammunition, and ammunition can therefore be regulated or even prohibited.

#2 Guns don’t kill people, people kill people.

Glib, but inaccurate: People with guns kill people. As we saw in the Newtown tragedy, someone with a semi-automatic assault rifle can take out a lot of people in a matter of minutes. If the Newtown shooter had only knives, he would not have been able to kill more than a few people in that time, and maybe would not have been bold enough to attempt his mass murder.  I heard someone on National Public Radio this week quote former New York Senator Daniel Patrick Moynihan, who said that it’s bullets that kill people, which is another clever argument for allowing the sales of guns but not of the ammunition that make the guns lethal.

The evidence for a causal relationship between gun ownership and gun violence is stunning. All other industrialized nations have much stricter gun control laws and far fewer people who own guns. The result is that they have much lower rates of deaths by guns. In fact, among the 23 populous, high-income countries, 80% of all firearm deaths occur in the United States.

#3 Bad guys will get guns no matter what; or “when guns are outlawed, only outlaws will have guns.

But if guns were more restricted, it would be harder for the outlaws to obtain their firearms, which would discourage many potential bad guys. There can be no doubt that the Newtown shooter would not have been able to buy a gun by himself; that he was allowed to practice shooting without going through a qualification process that included a certification of mental health is truly appalling. 

Keep in mind, too, that restrictions on private sales of guns would give law enforcement agencies another arrow in their quiver in fighting violent crime.

Finally, as gun control organizations such as the Brady Center substantiate, many more people are killed by guns because of accidents, domestic disputes and mass murder by deranged nut-jobs than by criminals in the course of robberies, mob hits or other crimes. An estimated 41% of gun-related homicides and 94% of gun-related suicides would not occur under the same circumstances had no guns been present.

#4 If more people carried guns, the criminals would be afraid to use theirs

With this argument, gun advocates enter a Wild West fantasy in which we always know who the good guys are and who the bad guys are. In a shooting situation, that just isn’t so.

These fantasists don’t really think through their scenarios at all.  Imagine, for example, an attempted bank robbery or convenience store stick-up: The police arrive to find a shooting gallery. How do they know who the robbers are and who are merely defending themselves?

Or think of the mass murder of 12 people in a movie theatre in Aurora, Colorado earlier this year: You’re in the theatre and all of sudden the air is filled with smoke and gun shots. So you pull out your gun and start shooting back in the direction you think it’s coming from. Someone on the other side of the theatre sees you fire your weapon and thinks you’re the shooter and starts aiming at you. Meanwhile, the hundreds of other people in the theatre now have gunfire coming at them from three, maybe even more, directions. When you think it through, it’s clear that many more dead would have been the likely scenario if a vigilante had pulled a weapon out and started firing at the Aurora mass murderer.

Police are trained to know when to fire their guns and when not to. The average citizen does not receive this training.

At this point in American history, the argument is not about prohibiting hunters or range shooters from practicing their sport. It’s about protecting the public from the proliferation of weapons in society. As I pointed out about two years ago and others are saying now, no one objects to rigorous testing for driver’s licensing, complicated rules of the road and the requirement that people who drive cars must have insurance. Why should legitimate hunters and range shooters object to regulation of their sport? 

OpEdge Redux: The low minimum wage reduces to a subsidy to businesses

By Marc Jampole

While OpEdge is on a two-week hiatus, we are running some of the more evergreen columns from past years. This blog entry originally appeared on October 16, 2012.

The statistic has been around for a few months now, but I just stumbled upon it and was amazed: Wal-Mart workers collectively receive $2.66 billion a year in food stamps, or $420,000 per Wal-Mart store in food stamps. Year after year, low Wal-Mart wages lead to the government providing food stamps and other assistance to their workers and thus indirectly subsidizing Wal-Mart’s profit.

What would happen if Wal-Mart raised the wages it pays its workers to a level that prevented them from qualifying for food stamps? In asking the question, I assume that Wal-Mart, like most companies, does not carry excess labor and so could not lay off masses of people to keep their profit margin stable. So the company would be forced to raise prices. But if Wal-Mart raises prices too much, people will start shopping elsewhere. After all, the main reason people shop at Wal-Mart is price.

To remain viable as a business, Wal-Mart would eventually have to take the money to pay workers a decent wage out of profit and executive salaries.

That means that there would be less money for the multi-billionaire Walton family and the executives who make millions, starting with $35 million a year for the chief executive officer. Maybe the CEO would have to settle for making 42 times what the average worker makes, which is what the average manufacturing CEO in the United States made in 1960. By the way, the average U.S. manufacturing CEO now makes 344 times what the average worker makes, compared to 25 times the average worker for European CEOs. Wal-Mart’s CEO currently makes more than 2,000 times what an entry-level Wal-Mart employee does.

It amazes me that Republicans like Mitt Romney, Paul Ryan, Newt Gingrich, Rick Santorum and the other good old boys and girls don’t complain about the corporate giveaway that takes place every time someone with a minimum or low wage job files for food stamps.

During the past 30 years, one way that income has been transferred from the poor and middle class is through the deterioration of the purchasing power of the minimum wage. Since the late 1960’s the minimum wage has lost 40% of its value. Most people who lose 40% of their purchasing power would be in real trouble—so imagine what it means to those at the lowest end of the wage spectrum.

It’s been a boon to employers who now can pay a de facto 40% less to get minimum wage jobs done. Since the minimum wage sets the bar for wages and salaries at all levels, it’s no wonder that on average, employees make less than they did 30 years ago, when inflation is figured into the equation.

My proposal is to set the minimum wage at a level so that 40 hours of it would bring a worker above the maximum level for receiving food stamps. That would result in an increase in all wages. It would also take money out of the pockets of the rich folk who save a significant part of their income and put that money into the hands of the poor, near poor and middle class, who would spend more of it, thus creating more jobs. Don’t worry, the rich and upper middle class would still do pretty well.

The fly in the ointment is the possibility that Wal-Mart and other large companies would offshore even more jobs to Asia than they do now. Which brings us to the second part of my proposal: that no good or service be allowed to be imported into the United States unless the producer/seller both paid its workers the prevailing U.S. wage and provided a similar level of safety and environmental protections.

My two proposals would lead to a more equitable distribution of wealth, in the United States and probably worldwide. Studies of 20th century America, 14th century Europe and 16th century Spain demonstrate that a more equitable distribution of wealth leads to a stronger economy.

The alternative is to continue on the path we are on and end up having an economy and society that look like those of a third world nation.   

Pet Projects by Kevin Kreneck

Art by Kevin Kreneck

OpEdge Redux: More from the speech I gave connecting the attack on public unions to 30 years of taking from everyone to give to the wealthy

By Marc Jampole

While OpEdge is on a two-week hiatus, we are running some of the more evergreen columns from past years. This blog entry originally appeared on April 16, 2011.

More from the speech I gave two nights ago at the monthly meeting of the Pittsburgh Area Jewish Committee (PAJC):

To belabor what is probably obvious, shrinking the percentage of the workforce covered by unions shifts money up the economic ladder because the non-unionized workers make less for the same or comparable jobs, leaving the difference for executives, owners and shareholders. It’s not a coincidence that the period in which the United States had the most equal distribution of wealth was the same age in which the economy was the strongest and that unions were also the strongest: after World War II through most of the 70s.  Unions turn low wage jobs into middle class jobs—they always have and they always will.

Here are some other trends that have helped to concentrate more of our income and wealth in relatively fewer hands:

• Tax policy:  We can describe our tax policy since Ronald Reagan took office as “Reverse Robin Hood.”  In Reagan’s first year, Congress cut income taxes to historically low levels, that are nevertheless still higher than today.  A year later, Congress raised taxes, but the new increases fell heavy on the middle class and the poor. And for more than 30 years, that’s the way it’s gone:  tax cuts that primarily benefit the wealthy alternating with tax increases that primarily take more form the middle class. The Bush II cuts that have recently been extended have the highest incomes paying the lowest rates and the lowest percentage of total government revenues in the history of the modernized West.  But even as we have lowered taxes, we have borrowed more money, creating safe havens and investment opportunities in which the rich can stash the money they have saved in taxes.
• The movement to privatize what have been traditional government services such as running prisons and educating our youth:  Whether for schools, prisons, or cooking and delivering meals to soldiers, when a private company does it, it intends to make profit for its key executives and shareholders.  As many studies have shown, low level government workers, many of whom are unionized, typically make more money than their peers in the private sector, most of whom aren’t unionized, whereas private sector presidents, officers and senior management make far more than department heads and other civil service executives.   Some government contracting makes sense, for example, to manufacture tents for soldiers or provide a special social service to an “at-risk” population; these functions have historically been outsourced.  But the new outsourcing of the recent past has usually not worked well for our citizens. Virtually all studies on charter school performance demonstrate that charter schools almost always fail to improve student performance and often worsen it. It is also well documented that the privatization of our prisons over the past 25 years has been a festering scandal of prisoner abuse and fraud.  When the government loans money to students for college and career training, the terms have been significantly better than when the private sector was allowed to do so between the early 90’s and this year. And let me ask you this—did you prefer how our wars went when we used relatively few contractors as in World War I and II, or now that we’re making massive use of military contractors in Iraq and Afghanistan?   Again, keep in mind that when the government gives a contract out instead of doing it with its own workforce, it is taking money from lower paid employees, who tend to be middle class, and giving it to executives and investors, who tend to be wealthy.
• Shrinking of social welfare programs: We don’t have to spend much time here.  It’s clear that a social welfare program, whether it’s food stamps, healthcare for poor children or support of state universities, represents a transfer payment down the economic ladder.  When we used to provide more money for these programs, we had a more equitable distribution of wealth than we do now.
• The attack on social security: The first step in the 30-year attack on Social Security came when the administration of Ronald Reagan changed the government accounting system and rolled the Social Security Trust Fund into the general budget and then claimed that the Trust Fund was near bankruptcy when all it needed to remain strong was to get back the money that it had lent the federal government.  Since then, almost every “fix” that has been made to the system has taken benefits away, for example, by raising the age or retirement, or to collect more Social Security revenues by increasing the percentage of what people pay.  In the same time, the cap on wages to be assessed Social Security taxes has crept up very little when inflation is considered.  Because of the graying of the baby boom generation, we do face a minor shortfall in the Trust Fund in about 30 or so years, not a grave one, but our elected officials seem to avoid the obvious solution—to take the cap off the income which is assessed the Social Security tax.    
• For example, President Obama’s National Commission on Fiscal Responsibility & Reform proposes eventually raising the retirement age to 69 and raising the cap on income assessed by the Social Security tax only to $170,000.  The lawyers, accountants and writers in this room could work well into our 70’s or 80’s, but the age of 69 seems pretty old for retirement from most jobs: think of janitors, warehouse workers, retail clerks, factory workers, truck drivers, and most hospital staff.  Why couldn’t the National Commission have knocked a few years off that proposed retirement number and taken the cap off the income to be taxed for Social Security?
• Its treatment of Social Security is one of just many ways that President Obama’s National Commission wants to accelerate the movement of income and wealth up the ladder.  Although not asked to mess with the tax system, the Commission gave a detailed recommendation for changing it.  Paul Krugman is just one of many economists who, upon analyzing the series of tax increases and decreases proposed by the commission, recognized that if the commission’s plan passed, the wealthy would be paying even fewer taxes.  Meanwhile, the National Commission proposed draconian cuts to social welfare and education programs, again taking money from the poor and middle class who benefit from these programs and giving it to the wealthy, who will get the benefit of the proposed tax breaks.
• Right-wingers, primarily Republicans, are on the move in many states to take more away from the working and middle classes.  Republicans in Missouri, Michigan, Arkansas and Florida have all taken steps to cut the time that the unemployed can receive unemployment benefits. And nationally, the right-wing has begun a legislative assault on Medicare and Medicaid’s funding and fundamental structure.

Now that I have shown you how this massive net transfer of money—almost a heist, as it were—occurred, I want to close with two questions: why should we care and what can we do about it?

Why should we care?  I think most of us are fairly well off, and statistically speaking many of us would qualify as wealthy.  Many of us are among the ones who have done quite well over the past three decades.

But we should all care because one of the hard lessons of economic history is that nations in which equality of wealth increases over time always thrive economically whereas those in which the equality of wealth decreases tend to decline.  I first read of this idea from Fernand Braudel, usually considered the great historian of the 20th century after Toynbee, who brilliantly analyzes Spain’s decline during the 16th century because of the growing unequal distribution of wealth fueled by the growth of predatory tax policies that had the poor and middle classes paying more and the wealthy paying less. A positive historical example is Western Europe after the Black Plague, an age of rapid economic growth and the highest average wage compared to total wealth in western history. Closer to home, we can compare our nation’s condition from the end of World War II to the late 70’s to what it has become since, save for the Clinton boom, which also saw a temporary reversal of the trend towards greater wealth inequality. If we don’t reverse the trend, the economy and quality of life in the United States will decline quickly and permanently.

I want to pose and then give my answer to one other question: What to do to reverse the three decade trend of greater wealth inequality in the United States?  The following are some actions that I would submit we should demand from our elected officials and those who want our vote and support in primaries:

• Raise taxes on the wealthiest five percent of incomes and use the funds to provide simple wealth-shifting programs such as lowering the cost of tuition at public universities or increasing food stamp payouts.
• Remove the $106,800 cap on individual and employer payments to the Social Security Trust Fund (known sometimes as SSI or payroll taxes), so that everyone pays on all income but keep the cap on maximum benefits, which would secure the Social Security system well into the future.
• Raise the minimum wage.
• Foster unions by lowering barriers to unionization, ending “right to work” laws and requiring that charter school teachers join unions in areas in which the public school teachers are unionized. 
• End government outsourcing for ongoing non-manufacturing, non-research government functions such as operating prisons and public parking and providing military services.  Government pays lower paid workers more and higher paid workers less than the private sector does, so when the government does it, there is a more equitable distribution of wealth.

All of these actions will raise wages and redistribute wealth down the economic ladder.  The experience of Western Europe suggests that these moves would not threaten our competitiveness in global markets.

We won’t be able to fix in one election, or even in one decade the grave harm which three decades of taking from the middle class and poor and giving to the wealthy has inflicted on our society.  But if we don’t get started now we will continue along the same sorry path that in 50 short years turned Spain from the most powerful nation in the world into Europe’s backwater for four long and hard centuries.

OpEdge Redux: The speech I gave connected the attack on public unions to 30 years of taking from everyone to give to wealthy

By Marc Jampole

While OpEdge is on a two-week hiatus, we are running some of the more evergreen columns from past years. This blog entry originally appeared on April 15, 2011.

I gave the following remarks yesterday evening at the monthly meeting of the Pittsburgh Area Jewish Committee (PAJC). My topic was “putting the Attaack on Public Unions in Perspective.”  I spoke after Sam Williamson, Associate Manager of the Pennsylvania Joint Board of Workers United, SEIU, spoke on the significance of the 1911 Triangle Shirtwaist Fire

In this speech I pull together a number of ideas that have populated by blog over the past 18 months, so I thought I would publish it on the blog for my readers. It’s pretty long, so I’ll split it up over two days:

Over the next 15 minutes, I’m going to put the current attempt in many states to reduce pensions and curtail the collective bargaining rights of unionized public employees into two broad contexts: one—the 30-year war against labor unions and, two—the role that war has played in the broader movement of income and wealth up the ladder from the middle class and the poor to the wealthy, also a phenomenon of the last 30 years. 

My interest in these matters began when I was a television news reporter working for the national news program, “Business Today” and covered the air traffic controllers’ strike of 1981.  During that time I was the first mass media journalist to report about the impact of the graying of the baby boom generation on the economy and society, and also the first to report on our development into a nation of rich and poor.  Today, among other things, I write the blog, OpEdge, which has investigated and analyzed the right-wing war against unions as one of its continuing themes. 

Let’s get started, because we’re talking about class warfare, which as Betty Davis might have said, is always a bumpy ride.

The attempt of Governor Scott Walker and the Republican legislators to end important collective bargaining rights in Wisconsin is the tip of the iceberg of what is an all-out assault on public workers occurring before our very eyes.  Here are some other examples that have not received as much ink nationally:

• In Indiana, Democrats legislators also walked off the job to slow down Republican efforts to ram through laws that weaken Indiana’s prevailing wage and collective bargaining laws.
• In Florida, there are three bills moving through the legislature that weaken the teacher’s union, restrict political activity by public unions and reduce benefits to state workers. 
• Republicans in Iowa, New Jersey, Maine and Ohio are all trying to restrict collective bargaining rights of state employees
• Meanwhile, the governor of Ohio wants to exempt universities from a requirement that they pay union-level wages on construction projects.
• Even Democrats are getting into the “attack the unions” game.  Connecticut’s new Democratic Governor is demanding $2 billion in public union concessions over two years.
• Let’s cap this review of anti-union activity across the country with a little Alice in Wonderland thinking that many have been doing, including the New York Times this past January.  It seems as if certain policy makers are considering ways to enable states to enter bankruptcy in a new and as yet illegal way that would allow the states to keep paying municipal bond holders while breaking all union contracts. 

If you think all this activity against public unions sprang up overnight as a collective expression of the anger or frustration of a country riddled with economic problems, then you haven’t been paying attention.  Right-wingers, primarily from the Republican Party, have been aggressively trying to curtail unionism and union political activity since the ascension to the presidency of the patron saint of union-busting, Ronald Reagan:

• Symbolically, the 30-year war against unions began when President Ronald Reagan fired more than 11,000 air traffic controllers—85% of all air traffic controllers—because they did not return to work as ordered during a strike in August of 1981.  Reagan also banned the fired employees from all future federal work, a move that the Clinton Administration rescinded in 1993.
• Reagan packed the National Labor Relations Board with management representatives. Prior NLRB boards settled only one third of all cases in favor of employers, even under Nixon.  Reagan’s NLRB settled three-quarters of all complaints in favor of employers.  The NLRB under Reagan also took more time to settle union complaints, which made it harder to organize and easier for management to pursue decertification campaigns.
• Both Reagan and Bush II’s Labor Departments were anti-union.  Reagan’s Labor Department, for example, declined to ask union-busting consultants and the companies that hired them for the financial disclosure statements the law demands, but it did ask unions to provide this documentation. Though the Labor Department cut its overall budget by more than 10 percent, it increased the budget for investigating union finances by almost 40 percent. 
• Under Bush II, the budget was again eviscerated, with funding stripped from every enforcement operation: workplace health and safety, minimum wage, fair hours, and even child labor.  But no surprise, funding for investigations of labor unions increased.
• Now we come to that odd confection called charter schools.  Although many well-intentioned people now support charter schools, make no bones about it—the inception of the charter school movement and the continued advocacy by the right-wing has from the start derived from anti-union motives. For the most part, charter schools replace unionized teachers with non-unionized ones, who, of course, make less money, a necessity if the charter school is going to make a profit for its organizers.  The list of long-time financial supporters of the charter school movement reads like a who’s who of union haters, including the Walton family and the Koch brothers.  And supporting charter schools is part of the anti-union panoply of policy recommendations by such anti-union think tanks as the Heritage Foundation, the Pacific Research Foundation and the Goldwater Institute. By the way, virtually all studies of the matter show that the charter school movement has yielded disappointing results in the area of student performance both in school and on standardized tests.

The war on unions is just part of a larger trend over the last 30 years to transfer both income and wealth up the economic ladder.  This period has seen incomes and overall wealth of the middle class and poor stagnate while those for the upper 5% and 1% grow steadily.

Before I lay out some of the key events in this transfer of income and wealth up the economic ladder, let me first convince you that it has occurred.  Most of my facts were supplied by Professor William Domhoff, author of Who Rules America Now and The Powers that Be:

• The top 1% now owns 34% of all the wealth in the United States, compared to only 20.5% in 1979, for a gain of almost 70% in the past 30 years!
• Income of the top 1% was only about 13% of total income in 1982 and today  it’s about 21.5%—a gain of two-thirds!
• The chief executive officers and presidents of companies now make many more times the money than their average full-time worker does.  In 1980, CEOs made about 42 times what the average worked was paid; CEOs now make 475 times the income of the average worker in the United States.  By the way, in Europe and Japan, it’s anywhere from only eleven times as much to 22 times as much
• The top 1% of U.S. households owns nearly twice as much of America’s corporate wealth as they did just 15 years ago.
• And only the top 5 percent of U.S. households have earned additional income to match the rise in housing costs since 1975.

I think it’s reasonable to say that all ideology and philosophy aside, the past 30 years have seen the rich taking more of the pie and leaving less for everyone else.