Monday, August 31, 2009

“OOH E OOH AH AH, TING TANG, WALLA WALLA BING BANG…”

8/31/09

Mary Schmich wrote a column in yesterday’s Chicago Tribune describing the plans of Lincoln Park Zoo to first eliminate the zoo’s docent program and then bring it back in a what some management types call a more “specialized, professionalized” form. People who have been working as docents, including the featured 78 year old Jack Gelfond, who has been working as a docent for 14 years, will have to reapply.

I don’t have strong feelings about the docent program at Lincoln Park Zoo. However, I do have strong feelings about the Zoo, one of the nation’s great zoos. Back when first I, then we, lived downtown, I or we would often walk along the lakefront to LPZ. (It is, after all, free, so the attraction of the zoo for the Quinns is obvious.) It’s a great place to spend time watching the animals, the people, and the spectacular surroundings of one of the nation’s great parks and neighborhoods. The docents always added to that experience with their knowledge of their charges and their enthusiasm for their volunteer jobs. My wife considered becoming a docent, but then we moved away, started having babies…you know the story. It seems to me that the docents will be missed, but perhaps the new program will result in new, improved docents. One suspects, though, that the results of the management types’ tinkering with the docent program will be about the same as the result of Coca-Cola’s managements’ tinkering with the old formula, but, being an expert on neither the operations of zoos or the finer points of sugar water, I just don’t know enough to make that judgment.

What I do know, though, is that, according to Ms. Schmich’s report, someone wrote the following drivel in a zoo document:

“…the antiquated volunteer utilization model…does not enhance the zoo’s strategic initiatives and often does not set up the volunteers for success.”

Hmm…

Someone was actually paid to write such codswallop, in all likelihood some consultant type who spent his or her college or grad school years in some management program learning the latest techniques in substituting gormless gobbledygook for actual management, or actual work.

Is it a mere coincidence that the onslaught of this corporate equivalent the Tower of Babel became popular at roughly the same time our large corporations became bureaucratized and anesthetized and our economy began its long descent into economic hell? Imagine what might have happened had the talent that went toward devising such mumbo-jumbo, and making the decision to hire people to produce such foppish flim-flam, went toward, say, figuring out how to effectively compete with cheap labor in the developing world, actually analyzing the securities the financial types stuffed in America’s (now) collective portfolio, or avoiding ignominious bankruptcy? Perhaps we might have a viable economy today. But maybe not. Maybe the production of such pointless pap in the “mission statements” and annual reports of the bulbous, billowing bureaucracies that used to be our great corporations kept their bumbling managements distracted, thus preventing even more serious damage from those who think uttering such tripe as “antiquated utilization model” and “enhancing strategic initiatives” constitutes management.

Saturday, August 29, 2009

“PENNY LANE IS IN MY EARS AND IN MY EYES…”

8/29/09

It looks as though, despite the death of Ted Kennedy, the most ardent champion of a single payer health system, or something very much like it, and despite talk of a Democratic “go it alone” strategy, we will see no significant changes to our nation’s health care system during this Congress, or for a long time afterward. This outcome was eminently predictable months ago, or even during the presidential campaign, when “health care” was such a hot topic. Why? It has nothing to do with the noisy town hall meetings. It has little to do with the growing Bush/Obama deficits. It certainly has nothing to do with the specifics of the various pieces of legislation or the Democratic leadership’s, both in the White House and on Capitol Hill, political ineptitude. No, major changes (reform, to some) of the health care system, a fervent goal of the left, is nowhere in sight for the same reason that educational vouchers, a fervent goal of the right, are nowhere in sight: the constituency that counts, the suburban, home owning, middle class voter, is happy with both its access to health care and the schools to which it sends its kids.

How can I say that the suburban, home owning, middle class is the constituency that counts? First, it votes. Second, within that broad set of people reside two vital and, paradoxically, intersecting sub-constituencies. The first of those is the swing voter, mostly moderately conservative but who would certainly entertain the notion of voting for a level headed Democrat, often because that voter’s roots, or his or her parents’ roots, are in the city and in the Democratic Party, but not the Democratic Party of Nancy Pelosi and Charlie Rangel, or the notion of voting against an incompetent, or seriously troubling, Republican, like George Bush, Sarah Palin, or Alan Keyes. The second sub-constituency is the bedrock Republican voter; indeed, the suburban, home owning, middle class voter is the very foundation of the Republican Party. These voters are not the foundation of the Republican Party because they are the ideological bedrock of the Republican Party; they are not the “true believers” (Though if my conversations with my neighbors are any indication, this is changing as more people have taken up Rush Limbaugh and Glenn Beck as pastimes.) because they don’t buy into any extreme ideology and/or they are too busy making a living to spend too much time agonizing over the finer points of domestic or foreign policy. So it is not ideology that makes these people the bedrock GOP constituency and it is not even their (admittedly fading) instincts that government is not the answer to their problems and their now completely obsolete belief that the GOP stands for smaller government. No, these people are the very foundation of the GOP because, without these voters, the GOP ceases to exist as anything more than a bothersome anachronism. The GOP’s existential need for these folks once made the Republicans receptive and attentive to the concerns of this constituency, long before they abandoned these middle class suburbanites and became the meretricious lapdogs of its Wall Street and defense contracting bankrollers. This abandonment of the suburban middle class homeowner in favor the seven and eight figure CEO and investment banker is the reason that the GOP is probably going the way of the Whigs, but that is grist for another post.

So the suburban, middle class, home owning voter is the only constituency that really counts because it votes and because it is the swing vote, and if it continues to swing away from its former home in the GOP as that party comes to be controlled by the Sarah Palins and the Bush acolytes of the world, the GOP is finished. If the GOP can keep these voters in the fold, it still has a chance. Given that both parties need this constituency, and that this most vital of constituencies is happy with its health care situation, major revisions to the health care system in this country are going nowhere. Likewise, though not as salient at the moment, since the typical suburban homeowner is happy with his or her kids’ schools, vouchers have been off the table for a long, long time and are highly unlikely to make a comeback.

The Democrats had a chance to make this constituency restive about its health care options (See my now seminal 2/15/09 piece, “SICKOS.”) back when the economy was falling apart. (But the guys in Washington and Wall Street have turned that situation around, right? Happy days are here again! Grist for yet another post...or twenty.) But, instead of exposing the typical worker’s vulnerability under our perverse system in which one’s health insurance is tied to one’s type of employment, the Democrats decided to subsidize COBRA payments. While that was probably the right thing to do from a humanitarian standpoint, from a purely Machiavellian political standpoint, they blew their brief, shining moment of a chance to achieve one of their long cherished, and now distant to the point of invisibility, goals: radically changing the system of health insurance in this country. The Democrats instead opted to keep the suburban, home-owning, middle class voter happy, probably because the Democrats are smart enough to see that they need these voters…and maybe smart enough to see that the Republicans need them far more.

Friday, August 28, 2009

“…AND THEN THERE WILL BE TEDDY…”

8/28/09

The death of Senator Ted Kennedy this week inspired plenty of news coverage that those of us who have a profound interest in history, especially post-War U.S. history, found compelling. Much of the coverage consisted of hagiography from the left and the “mainstream” media and “all Chappaquiddick all the time” vituperation from the right and its media outlets. Given the historical value, and the continuing salience, of any discussion of Ted’s, and his family’s, role in history and the utter lack of balance from either side in its coverage of the topic, I felt compelled to share some of my thoughts concerning the man who has legitimately and justifiably been endowed with the moniker “The Liberal Lion of the Senate.”

Let me start by saying that I was, and am, to put it mildly, not the biggest fan of Ted Kennedy and never cared much for his brothers or for his entire family. But, as the years have gone by and my perspectives, both political and personal, have come to evolve, I grew to like Ted Kennedy for a number of reasons. So here are the thoughts, both positive and negative, but mostly positive (The man just died; this is no time to emphasize the negative!), of a guy who was neither Kennedy’s biggest detractor (although, at one time, I was right up there) nor his biggest fan, but who believes that attitudes can evolve and that mercy, and slack, are two of the qualities of our Savior that we should, but usually don’t, emulate.

First, not only did Kennedy have entertainment value when he got really worked up over one of his causes (Some call this demagoguery. I would probably agree. But demagoguery is not only entertaining and a sign of passion, but also is relatively harmless in an informed society. To the extent that demagoguery is dangerous, the dullness of the society is as much to blame as the sharpness of the demagogue.), but, and this is closely related, you knew exactly where Kennedy stood on any issue. He was pretty much a down the line liberal. He didn’t try to pretend he wasn’t a liberal, and he didn’t try to hide behind anodyne terms like “progressive,” when being a liberal was not only not cool but, in many cases, a ticket to political obscurity. On virtually any topic, you could guess with amazing accuracy where Kennedy would stand before you heard, and in some cases before he had formulated, his stance on the issue. In that sense, he was an honest man who had some profound and real beliefs. There are so few of us left that I feel a profound kinship with such people, even when I disagree with them on most topics, or at least the overwhelming majority of public policy topics. On one of the few issues on which I nearly completely agreed with Senator, George Bush’s adventurism in Iraq, he was one of the few guys with the courage to take a direct stance against the war when many of his liberal colleagues, who doubtless shared his views in private, cowered and hid beyond innocuous resolutions that provided little but political cover for themselves. Of course, the security of Kennedy’s seat made such courage far easier in his case, but it would have been nice to see at least a few people besides Mr. Kennedy and Ron Paul take a firm stance against this largest foreign policy mistake since, or maybe even including, Vietnam.

Second, while Kennedy was a prodigious Democratic fundraiser, no one in history was better for Republican fundraising than Ted Kennedy. While others, including Hillary Clinton, Nancy Pelosi, and President Obama, have risen to near Kennedyesque heights in this regard, no one can replace Kennedy, with his unabashed liberal outlook, his, er, personal failings (entirely, by the way, in his past), and his usually bulbous appearance, as a focal point for Republican ire and thus for GOP fundraising.

Third, I get the impression that Kennedy was genuinely a nice guy. If we are to believe the reports of his letters to the families of those residents of Massachusetts (Massachusians? Massachusettians? How about Bay Staters? Does anyone out there know what one calls a resident of Massachusetts, other than overtaxed?) who died in the 9/11 attacks, his personal calls to many of the affected families, and his attendance at countless funerals of fallen American servicemen, this was a man who was genuinely concerned with people and who, for obvious reasons, could empathize with those who suffered immense personal tragedy. One could argue that Senator Kennedy’s more selfless actions were really political stunts, but what political motivation did the man who occupied perhaps the most secure seat in the United States have for these very thoughtful, and very Christian, deeds? And, even if you are a dyed in the wool conservative, who would you rather have dinner or a beer with, Ted Kennedy or Chuck Grassley? C’mon!

Fourth, some will castigate Ted Kennedy for his “fierce partisanship.” I, for one, like partisanship, usually the fiercer, the better. The only people who are big fans of bipartisanship are members of the party that is out of power. Partisanship springs from deeply felt ideas. Those who, like yours truly, are dismayed by the cynicism and hypocrisy of what has come to be the governing class in this country have no business decrying partisanship. Indeed, one of the things that bothered me about Ted Kennedy was one of the qualities for which he is being most cloyingly praised in the wake of his death, i.e., his ability to “reach across the aisle.” I don’t want these guys “reaching across the aisle;” when they do so, they are sure to be cooking up a scheme to use our own money to dip their considerable probosces further into our affairs. I want these guys figuratively at each others’ throats because political combat and strife in Washington is the surest safeguard against intrusive government, other than an informed electorate, which left the building, never to return, a long time ago.

That having been said, while I like to see our public servants at each others’ throats on political issues, it would be better for everyone if such strident policy differences did not have to become bitter personal hostility. I yearn for the days when Ronald Reagan and Tip O’Neill could fight like hell over policy and then share amiable drinks at the end of the day. On that front, too, Kennedy seemed to have an admirable record. He had plenty of personal friends, and few personal enemies, on the Hill. Sadly, though, as the political has come to be personal, a sign that even those “conservatives” who routinely decry “big government” have come to see politics and political views as the be all and end all of one’s existence, I am sure that the number of those personal enemies of Mr. Kennedy has grown.

Perhaps it is hypocritical for the guy who invented monikers like “Preppy Timmy Geithner” and “Obsequious Ben Bernanke” to speak of not letting political differences become personal differences, but I, like Reagan, who used his share of barbed and well aimed zingers, genuinely enjoy the company of those with whom I disagree on political, and perhaps even more significant, issues. Those who know me know this is true. After all, it IS only politics. Ronald Reagan knew that…and so did Ted Kennedy.

Wednesday, August 26, 2009

“…WOIKIN’ FOR THE MAN EVERY NIGHT AND DAY…”

8/26/09

The Chicago Sun-Times reports in today’s (i.e., Wednesday 8/26’s) issue that workers at SK Hand Tool, a relatively small company with operations on Archer Avenue in Chicago and in McCook, Illinois, learned that their health care coverage had been cancelled only after inquiring about the absence of deductions from their paychecks for insurance premia. No notice, no nothing. Just something like “Sorry, you no longer have health insurance.” In response, an unfair labor practices strike has been called by Teamsters Local 743, which represents SK workers, and, as of this writing, is ongoing.

The legalities of the situation are murky. While labor law has long established that benefits, like health insurance, are a legitimate bargaining issue, the contract between the workers and SK Hand Tool had expired in February. No new contract has been reached. The union argues that there was absolutely no discussion of health care benefits before those benefits were dropped. The company does not deny the lack of discussion, but does say that dropping the benefits was not its decision. SK argues that cancellation (again, without notice; one can make the case for dropping health coverage, but for doing so without notice? That is reprehensible.) was “due to a third-party’s decision to remove coverage, which was beyond our control.” While that might be true, the very turbidity of that statement, along with its not making sense even if it were as clear as crystal, makes it awfully hard to believe.

While the legality of SK’s actions may be subject to debate, the morality of discontinuing people’s health care coverage without giving them notice is not. Not only do people count on their employer provided health care coverage, many employees at SK, like people everywhere, were in the middle of some form of medical treatment or regimen and, having found out that they weren’t covered, after the fact, are out thousands of dollars. Given that the average hourly wage at SK is $14, the decision to cancel health insurance without notice has resulted in the financial ruin of some SK employees and the potential financial ruin of the rest. Maybe, as SK argues, cancellation without notice wasn’t the company’s decision. But someone did something despicable.

What is even clearer than the morality of this case is the support it provides for the utter inanity, if not insanity, of tying health insurance to employment. As loyal readers know from every post I have produced on the “health care” (See, inter alia, my 8/23/09, 8/13/09, and 7/1/09 posts.), I am truly agnostic on this issue, a genuine rarity for yours truly. But I am certain, or at least as certain as I can be about anything, that any genuine reform of the health care insurance system has to at least move in the direction of breaking the tie between employment and health insurance coverage, a relic of yet another government misstep, the price controls of World War II. The case of the workers at SK provides further evidence that trying to reform health care through “employer mandates” or “employer subsidies” will not go to the heart of the problem.

Tuesday, August 25, 2009

BEN IS BACK; BASH BEN!

8/25/09

Hey, tough guy, free marketeer, get the government out of my life, if only people would show more personal responsibility types on Wall Street! Did put your employer through a tough patch by applying the latest “risk mitigation” techniques and creating a FrankenCMO out of a bunch of mortgages that never should have been made, dismissing out of hand the old adage that putting a bunch of small piles of excrement together can only result in larger, even more malodorous pile of excrement? Did you put your bank into insolvency by stuffing its portfolio with the aforementioned piles of fast rotting garbage that your classmates at Yale put together? Did you put the retirements of your fund’s shareholders on permahold by using the modern financial techniques you learned as a justification for loading their portfolios with the dyspeptic discharge of your frat brother from Columbia’s trading desk? Did you fall and suffer a figurative or literal owwy knee? Well, your worries, to the extent you ever had any worries, are over! Uncle Ben will remain at the ready to pick you up, dust you off, kiss your wounds, and make everything better! Your shareholders may have seen their shares go to zero. Many of your “lesser” employees may be out of work, and out of luck. Your investors may be looking for work as Wal-Mart greeters, but you won’t have to sell any portion of the east coast fleet of Ferraris. Uncle Ben will make it all better!

Obsequious Ben Bernanke has shown that he is willing to fit yet another supercharger to the printing press at the Fed and put uncountable billions of taxpayer dollars at risk in order to make life as easy as possible for the Wall Street types whose approval, and potential access to future lucrative employment, he so desperately seeks. By reappointing him as Fed chairman, President Obama provides yet more compelling evidence that the Obama administration is nothing more than a dissolute and rudderless extension of the Bush administration. “No investment banker left behind” neatly encapsulates the Bush/Obama policy toward the economic and financial world.

Of course, the experts, most of whom have been direct recipients of the Bush/Obama/Bernanke Succor for the SuperRich approach to financial policy, will scoff at my failure to jump on the Bernanke float at the victory parade. What would have happened, they sneer, if Obsequious Ben had not turned on the turbocharger and “saved” our financial system? The answer is we don’t know; there is no certainty that we would be wallowing in the dystopia of a ‘30s redux if Obsequious Ben had not sycophantically kissed the rings of his future employers and potential (“Can I come? Can I? Can I? Can I?”) dinner party companions on Wall Street. It is at least as likely that we would have been much further along on the path of recovery, hopefully with a set of players distinctively different, and more circumspect, than the walloping wonderboys, and their nursemaids in Washington, that got us into this mess in the first place, if the situation were just left to work itself out with the Fed providing only ample liquidity rather than regular morning, afternoon, and evening feedings with either fiat or taxpayer cash and micromanagement of the financial system. We also don’t know, but I would be willing to bet, and have done so by taking long positions in gold, oil, and TIPS, that Mr. Bernanke’s efforts to dry the tears of the tough guy, rugged American individualist types on Wall Street will lead to an utter debasement of our currency, a rampaging inflation, and a decided acceleration of what looks like America’s inevitable economic and financial decline and fall, all while providing only temporary economic relief, almost none of which will be felt on Main Street.

Let’s see: Treasury Secretary Preppy Timmy Geithner. Fed Chairman Obsequious Ben Bernanke. Change we can believe in, indeed.

Sunday, August 23, 2009

PRESCIENT MR. PONTIFICATOR

8/23/09

This morning on Face the Nation, Howard Dean, former governor of Vermont, chairman of the DNC, and medical doctor was making the case for the “public option” in whatever health care reform emerges from our current game of legislative chicken. He made his argument extremely poorly, displaying a knowledge of finance and accounting roughly equivalent to that of my eleven year old, who ceaselessly proclaims that he has no interest in, and certainly no intention to study, “that boring stuff daddy teaches.” Among other things, when decrying profits as “wasteful,” Dr. Dean confused the payout ratio with the retention ratio and assumed that both were calculated on total revenues, rather than net income. Now, I don’t expect most people, or even most of my readers, who are smarter than the average bear and are more attuned to financial matters than most, to understand that the retention ratio and the payout ratio are complements of one another and that they are calculated on net income. But most people, unlike Dr. Dean, do not pontificate on such things as if they actually had some remote idea of what such high falutin’ terms mean. But I digress. It wasn’t that Dr. Dean delivered what amounted to an execrable imitation of Norm Crosby when he attempted to argue that health care reform without a public option is not health care reform at all that inspired this post. The point of this post is what came next, which has, over the last few years, become a standard line of all those who believe that sufficient government intrusion in our lives, and shares of our earning power, are the sure path to nirvana. Dr. Dean stated (and I have to paraphrase here; I heard, rather than read, Dr. Dean’s words and so can’t quote them, but this is VERY close):

The Congressional Budget Office scores the House proposal at $600 billion. That comes out to $60 billion a year, less than we are spending (or perhaps he said “have spent;” it makes little difference to the larger point) in Iraq.

Why did that contention especially pique my interest? Because it is wrong? No. Factually, Dr. Dean is absolutely right. Whether the numbers work out that way (They never do when the other people’s money is at stake.) is another issue. But the Iraq war has been more costly than current projections for health care reform with a public option, and certainly more costly than the public option itself. What made Dr. Dean’s comment tickle my eardrums is the fact that over two years ago, when the Pontificator (the column, not the writer) was in its infancy, I put up the following post:

7/10/07

ANOTHER COST OF THIS WAR

This morning, The Wall Street Journal, apparently exhausted from its ceaseless marathon of Bush cheerleading, took a break to report some actual news: A report to Congress has put the total cost of the Iraq war at $400 billion, so far.

This got me to thinking that critics of the Iraq war are ignoring one of the more enduring (albeit, compared to the truly stunning loss of life, utter destruction of a sovereign nation, and creation of a hotbed of terrorist activity that will plague us, and the entire world, perhaps for centuries, not the most salient) costs of the Iraq war. I am speaking of the fiscal costs of the war, but not “only” the $400 billion we have blown so far. I am speaking of the long run ramifications of this, to use a woefully inadequate word, counterproductive spending.

In the past, when someone, usually, but certainly not exclusively, a Democrat, proposed some asinine spending bill, those who still believed in fiscal prudence, usually, but certainly not exclusively, Republicans, could counter that, as desirable as the program might be (usually with a well deserved roll of the eyes), we simply could not afford it. Now, however, the proponent of the pointless program can counter “Well, if we could find $400 billion to spend on the Iraq war, we can find money for (Here insert the name of the program that will not only raid the treasury but have ghastly unintended consequences that will “require” yet another fiscal abomination to “solve.”).” Such an argument will become the Third Millennia equivalent of “If we can put a man on the moon, we can (Here insert whatever the speaker wishes the taxpayers to fund in order to fortify the spondulicks of his or her campaign contributors or some utopian goal that bears absolutely no relationship to putting a man on the moon.).”

One of the last arguments against runaway spending and kudzu-like growth of government has thus been destroyed by that self-proclaimed champion of “conservative” values, President Bush.

The Pontificator

Dr. Dean’s perfectly legitimate argument is just the latest case in which the above prediction came true.

As loyal readers know, health care is one of the few issues on which I am genuinely agnostic. Even the sub-issues involved leave my straddling the fence. (See my 8/13/09 post, “TAKE A DEEP BREATH” and my 7/1/09 post “SPEAKING OF INDEPENDENCE…”) For example, excluding people with preexisting conditions from coverage renders a large portion of the population uninsurable, but how can we expect legitimately profit seeking companies to cover people that they know will lose them money, EVEN IF everyone is forced into the pool? I know that runaway litigation is a major contributor to the surge in health care costs, but I also know that, without a healthy and vigorous tort system, more rigorous and intrusive regulation will be needed to protect patients from shoddy medical work, and rigorous and intrusive regulation is a commodity of which our country has plenty. I know our current health care INSURANCE system stinks, but the serious alternatives presented so far are not only philosophically repugnant to people who think like I do, they are also flawed from a practical standpoint; the government does not have a great track record at running much of anything, and that poor performance has its origins in irretractable human nature, not the ability or the intelligence of those charged with executing the designs of the governing class. So I’m not here to argue vigorously for or against anyone’s conceptions of health care reform.

However, I am here to argue that George Bush’s disastrous Iraq war, in addition to its massive immediate financial costs and, more tragically and saliently, costs in human life and to our standing in the world, and hence to the security Mr. Bush used as an excuse for this abominable war, has given the big spenders ammunition in arguing for any program. As I said above, you can hear, and have heard, the big government types: “If we can spend (insert ultimate dollar amount…now well over a trillion of your dollars) on Iraq, we can surely spend (a similar amount) on (name some inane program that serves mostly to reward some poltroonish pol and those who enable him or, in rare cases, some worthwhile program that we simply cannot afford and/or that the government has no business sponsoring and funding).

It is the Iraq war, among many other things, that gives George Bush his eternal place in the pantheon of pathetically parlous presidents, right alongside LBJ and Jimmy Carter. And for my conservative friends, no matter how bad Mr. Obama may get by, as he is doing now, simply continuing and perhaps intensifying Bush financial and foreign policies (and he has a long way to go before he reaches Bushian heights of disaster), he can NEVER be as bad as Mr. Bush, simply because without President Bush there would have been no President Obama, so Mr. Bush is doubly responsible for the disasters that have befallen, and should continue to befall, this country in the first two decades of the new millennium.

Friday, August 21, 2009

“I FOUND IT ALL…ON THE SOUTH SIDE OF CHICAGO…”

8/21/09

Mike Sneed, famed gossip columnist/political reporter for the Chicago Sun-Times who has long had a habit of regularly scooping most of her colleagues on the local political beat, reports this (i.e., Friday 8/21) morning that Cook County Sheriff Tom Dart was approached by what she describes as a “top top Dem” to “seriously consider running for the U.S. Senate seat once occupied by President Obama.” Ms. Sneed further says that she confirmed the report with the “top Dem” who “has heavy influence” in Cook County and the Obama administration, two traits that seem to go hand in hand of late.

Tom Dart would be a strong candidate for the Senate. With Chris Kennedy dropping out of the race after a long imitation of Hamlet the Dane, the Democratic field is left to State Treasurer Alexi Giannoulias and Urban League honcho Cheryle Jackson. Both are weak candidates. Giannoulias is very young, has little record of accomplishment, other than being born after his father and having played basketball with President Obama and professionally in Greece, and has a background in the (family) banking business, not a good perch from which to seek high political office in the wake of a financial crisis that had its origins, at least in the public’s mind, in the greed of the banks. Cheryle Jackson has a record of accomplishment that makes Alexi Giannoulias look like Dwight Eisenhower and is tainted by her close association with former Governor Rod Blagojevich, for whom she was chief of staff. As a partial result of the malodorousness of these two candidates, Republican Congressman Mark Kirk in ahead in the early polling in the Senate race. In a heavily Democratic state, this is earthshaking, so the Dems need someone other than Giannoulias or Jackson to bear their standard. Given Dart’s experience in the legislature and his recent (some might say shameless) headline grabbing in connection with his suspension of certain apartment foreclosures, the Burr Oak cemetery hornet’s nest, and his attacks against Craigslist’s more lascivious listings, he would be a more serious, or at least a more viable, candidate than the current reincarnations of Tweedle-Dee and Tweedle-Dum the Dems with whom the Dems are currently stuck.

Anyone who follows our fair city’s, or our fair state’s, politics, though, sees an immediate problem with Sheriff Dart’s candidacy. Mr. Dart is of Irish-American origin. Many of us have little problem with the Irish, though perhaps not the aforementioned Irish, ruling the world, but more objective observers do, including God, who gave the world whiskey in order to prevent such an eventuality. Already, state government is run by people named Quinn, Madigan, Hynes, Madigan (again), and Cullerton. Will the electorate want a guy named Dart to join his Celtic cronies in statewide office, especially when City of Chicago and County of Cook government and politics is dominated by people with names like Daley, Daley, Houlihan, Burke, Burke, Joyce, Madigan, O’Shea, etc., etc.?

Even more to the point, Mr. Dart is not only of Irish-American origin, he is South-Side Irish. Of the aforementioned Irish officeholders, only Illinois Senate President John Cullerton has his origins on the north side. While Comptroller Hynes, Attorney General Madigan, and County Assessor Houlihan may currently live on the north side (And they may not, but I am quite sure they do.), they all have their origins on the south side. Will the electorate, especially the downstate and collar county electorate, want another south side Irishman in even higher office?

Most to the point, especially for the political insiders who can nip Sheriff Dart’s senatorial aspirations in the bud, Mr. Dart not only is South Side Irish, he is South Side Irish from the 19th ward. As readers of my now classic 8/6/09 piece, “I DON’T KNOW WHO GAVE THE ORDER; I DIDN’T ASK, BECAUSE IT HAD NOTHING TO DO WITH BUSINESS!”, know, the 19th ward seems to be taking over everything, has spread far beyond its more traditional behind the scenes perch, and looks set to accumulate more power. As it stands now, State Comptroller Dan Hynes, a 19th warder, has declared his candidacy for governor. If reports are (or scuttlebutt is) true, State Senator Kevin Joyce, another 19th warder, is thinking of challenging Congressman Dan Lipinski in the 2010 primary for the 3rd Congressional seat. If Cook County Sheriff Dart does run for the Senate, yet another 19th warder will be running for the U.S. Senate. All three of these gentlemen not only, like yours truly, hail from the 19th ward, they still live there. Such a concentration of power in a ward that already boasts behind the scenes power brokers like Jerry Joyce and the Sheahan brothers (Again, see my now classic 8/6/09 piece, “I DON’T KNOW WHO GAVE THE ORDER; I DIDN’T ASK, BECAUSE IT HAD NOTHING TO DO WITH BUSINESS!”) would be altogether intolerable to party bigwigs from other wards, even, one supposes, such south side Irish suzerains as Mike Madigan and John Daley.

Something has to give; one of the young 19th ward trio of Kevin Joyce, Dan Hynes, or Tom Dart has to temporarily give up his aspirations for higher office and stay where he is for awhile. While I’m not in the business of making political traditions, at present it looks like it makes the most sense for both Messrs. Joyce and Hynes to step aside and defer to their more senior colleague Mr. Dart. His candidacy makes more sense and ruffles far fewer feathers than that of either Mister Joyce (if such a candidacy is more than a rumor) or Mr. Hynes.

SUCKERS

8/21/09

The Obama administration has informed us that it will terminate the Car Allowance Rebate System (“CARS”), better known as “cash for clunkers” on the evening of Monday, 8/24 at 8:00 PM EDT. My utter astonishment at the “success” of the program, along with some lessons that “success” holds for our entire economy, was reported in my now seminal 8/1/09 piece, “SOMEWHERE, (BE CERTAIN WITH) LINN BURTON IS SMILING.” As the program winds down, there are additional, largely political, lessons to be drawn from the program, some perhaps obvious, others not so obvious.

First, if the government had originally put all, or even a decent fraction of, the money it put into bailing out GM and Chrysler into a CARS type program, the bailouts would not have been necessary. Not that I am advocating such an approach, but if the Bush/Obama administration decided that it wanted to use a fire hose to direct money at the car business (which it could hardly NOT do after it gave the financial industry the old five alarm treatment), something like cash for clunkers would have been a less intrusive, and more effective, approach than a wholesale socialization of the business. Perhaps that is why CARS was not proposed earlier; think about some of the players’ attitudes toward the private sector, and especially toward Detroit, and those players’ more nefarious potential motivations.

Second, while the timing of the CARS program may or may not have been good from an economic standpoint, it was abominable, for the Obama administration’s perspective, from a political standpoint. The bumbling, maladroit handling of this program (See the next paragraph.) has given plenty of ammunition to those who argue, with now even more abundant justification, that if the government and/or the Administration cannot handle a $3 billion temporary program designed to provide one industry with a shot in the arm, how can it be expected to handle our nation’s entire health care system?

Third, the condescending, snide comments of Transportation Secretary Ray LaHood provide yet another example of that worst possible combination of attributes, arrogance and cluelessness, that is seemingly endemic to our public servants. Car dealers are growing increasingly concerned about getting paid late, or not getting paid at all, the money they advanced to customers based on the government’s promise. (Why anyone would trust a promise from the government any more than a sprightly young lass would believe the entreaties of young predator who promises that he will respect her as much in the morning is beyond me, but what choice did the typical car dealer have, when his competitors were glomming onto CARS like ants on watermelon rinds at a picnic?) The dealers’ fears and dissatisfaction are more than justified. As of yesterday (i.e., Thursday, 8/21), the government had processed only 170,000 of the 457,000 applications for CARS reimbursements it had received from dealers. Only $145mm of the $1.9b owed had reached dealers. So what does Secretary LaHood, once a prominent Republican congressman from my home state, now conveniently put in charge of ladling out “stimulus” money for road projects by a Democratic administration (Two parenthetical points: First, don’t you just love the politics of Illinois (or, for those of you who live here, wouldn’t you just love the politics of this state if you didn’t have to pick up the tab)? The book is on the way! Second, many Republicans will assert that Mr. LaHood, even when he was in the House leadership, was not a “real” Republican, whatever that means in the post-Bush era. I have an interesting story concerning a guy WAY HIGH UP in Republican national politics that is tangentially related to Mr. LaHood, but I will save it for another time because this post is already too riddled with parenthetical, or simply tangential, comments, and to relate this tale will look too much like name dropping. Further, I might want to use a laundered version of the story should my book “The Chairman: A Novel of Big City Politics” ever sell enough copies to merit a sequel.), say? I have to paraphrase here because I heard the comment on CNBC but did not see it in print and so can’t quote it directly:

Some people, if you threw them a life preserver, would complain about the color of the life preservers.

What a despicable, full of himself, out of touch, supercilious, pompous popinjay! These are small business people who don’t have regular access to the Treasury that in turn has access to the taxpayers’ wallets and a Fed ever ready to put the printing presses in hyper-drive in order to buy the Treasury’s debt. These dealers have to actually manage cash flow, a task, and a concept, completely foreign to Mr. LaHood and his ilk in both parties. Mr. LaHood’s condescending, or worse, comments regarding the dealers that the federal government has taken right to the brink of insolvency reflects a yawning, yet still growing, disconnect between the political class and the people it governs. As both parties come to be dominated by people who have never come closer to the private sector at least one of them lionizes (from a VERY safe distance) than a certain minor league club on the north side of Chicago has come to the World Series, we are going to get more people with Mr. LaHood’s attitude. Unfortunately, we will continue voting for these poltroons.

Monday, August 17, 2009

WHERE HAS WAVY GRAVY GONE?

8/17/09

In the midst of all the hagiography surrounding the 40th anniversary of Woodstock, Neil Steinberg of the Chicago Sun-Times wrote a sober, sensible column on the subject. I sent him the following letter praising his insight yet taking issue with some of his points. I thought my readers might enjoy my observations on this reportedly epochal event:

8/17/09

Hi Neil,

I enjoyed your 8/16/09 piece “Here’s why I hate Woodstock,” agreed with almost all of it, but still found some nits to pick.

The Woodstock Generation (Note my choice of words; I am certainly not castigating our entire generation, but only the “Woodstock Generation,” those who, whether they were there or wished they had been there, look upon Woodstock as potentially the greatest experience of their lives and certainly an epoch defining event.) is best characterized by self-congratulation, self-adulation, self-aggrandizement, and blatant hypocrisy. Note that this is the crowd who spoke out against crass materialism and castigated their greatest generation parents for their supposed senseless status consciousness and then went on to pursue investment banking, law, or politics, professions from which they engineered the financial machinations and pursued the pointless, senseless, ostentatious spending that pushed the economy their parents and grandparents built over the cliff. While there were exceptions (The “album cover” couple, people who, according to an earlier Sun-Times story, did not appear to come from wealth and who went on to live normal, productive lives of service to each other, their children, and their communities, are especially interesting and, I wish, representative.), one can safely conclude that the largest chunk of the Woodstock Generation was composed of children of privilege looking for yet another lark and found it first at Max Yasgur’s farm where they heard some admittedly great music and did some apparently wild drugs, and then in places like Wall Street and Washington, D.C., where they plundered the very foundations of the wondrous, powerful economy their parents had bequeathed them in order to pile up more useless junk in a vain effort to look down their noses at the “tacky” types who constitute what they condescendingly describe as “middle America.”

However, your ironic dismissal of the fact that 400,000 of these types got together in August of 1969 and didn’t kill each other as “a big flippin’ deal” is misguided; it was a big deal. Your comparisons to Pope John Paul II’s 1979 Mass at Grant Park, which 1.2 million people attended peacefully, or this weekend’s Air and Water Show, which even more attended, are lame. The Pope’s Mass was attended by a distinctively different crowd than that which attended Woodstock. The communicants at the Papal Mass were, by and large, far older than the attendees at Woodstock. Most were Catholic and respectful both of the Pope and of the strictures their faith (or that they thought their faith) imposed on them. If they were high at all, they were high on the Holy Spirit and, in many cases, the notion that one of their countrymen had become Christ’s Vicar on earth. The demographics at the Air and Water Show may have been closer to those of the Woodstock crowd, but alcohol and drugs were restricted and/or banned and law enforcement was heavy. Further, the Papal Mass was a one day event and the Air and Water Show can best be described as two one day events. Woodstock was a three day event. The participants, performers and “concert” goers alike, were kids with little innate sense of restraint. They were high on a lot of things, but the Holy Spirit wasn’t one of them, unless takes a cavernously broad view of the workings of the Spirit. Law enforcement was, if present at all, woefully inadequate. A bunch of kids doing drugs and drinking beer and pop wine with no cops around to spoil the fun; for what does that sound like a prescription? Yet, things didn’t get too far out of hand and no one, as you point out, got killed. That was the result, one can conclude, of an enormous, and uncharacteristic, display of restraint from the Woodstock crowd.

Would that the Woodstock Generation had shown similar restraint, and civility, in its later years.

Keep up the good work, Neil. I’m going to copy this to the Letters to the Editors section just in case they would like to run it.


Mark Quinn

Thursday, August 13, 2009

LOOK, UP IN THE SKY, IT’S A BIRD, IT’S A PLANE, IT’S……

8/13/09

Most major newspapers reported this morning that NASA is complaining that it doesn’t have enough money to complete its appointed task of tracking asteroids and comets that could present a threat to earth. While NASA estimates that there are approximately 20,000 such menacing heavenly bodies that have the potential to mean curtains for the human race, it has only been able to track about 6,000 of these troublesome space-borne miscreants with the money Congress has heretofore disbursed. NASA, like any other government agency, is thus pleading for more spondulicks to fulfill this vital mission.

Hmm…

What is the point here? Say NASA finds some asteroid or comet heading right for us, a flaming rock about the size of the space junk that killed off the dinosaurs. What could we do about it? Yeah, that’s what I thought.

So why are we spending ANY money keeping an eye on those agents of our potential doom about which we can do absolutely nothing? Is it worth billions to have the last few days of life on this planet completely ruined by the sure knowledge of our impending demise? Perhaps NASA will next ask for funding for the appropriate “Farewell to Earth” party, which would, come to think of it, be one of the very rare truly efficacious applications of taxpayer money. But the people at NASA are seasoned political types, used to the challenges of grabbling for their rightful share of the money you have worked so hard to generate. So a big party to say good bye is probably not in their plans. Instead, they will propose spending trillions on some glorified high school science project that (Just trust us on this one, okay?) just might have the potential to save us from an untimely demise.

Oh, well, what the heck. It’s not the NASA guys’, or the Congress guys’ money. Just like every other dollar of your money the government spends.

“WHAT’S THIS WORLD COMING TO WHEN A FATHER CAN’T HELP HIS KIDS?”

8/13/09

In the wake of the Chicago media’s sensationalizing the use of political influence (i.e., “clout”) to get students admitted to the city’s selective magnet schools, a suddenly hot story in the wake of the Chicago media’s sensationalizing the use of clout to get students admitted to the U of I (See my seminal 6/9/09 post “WE ARE LOYAL TO YOU, ILLINOIS…” and my at least as seminal 8/9/09 post “…WE'RE ORANGE AND BLUE, ILLINOIS, WE'LL BACK YOU SO STAND 'GAINST THE BEST IN THE LAND…”.),
the Chicago Sun-Times reports in this (i.e., Thursday, 8/13’s) morning’s edition that Alderman Ricardo Munoz of the west side 22nd Ward acknowledges that he made phone call to the principal of Whitney Young High School, one of the city of Chicago’s outstanding magnet schools, asking that his daughter be admitted to that highly competitive school. Further, Alderman Munoz, suddenly one of my favorites as a consequence of displaying that increasingly rare trait on the City Council, courage (Where are Paddy Bauler and Vito Marzullo when the nation so needs men of their testicularity?), goes on to say that he makes “at least 10 to 15” calls every school year seeking admission for children of his constituents. Alderman Munoz explains:

I wanted my daughter to attend Whitney Young. The curriculum is great…Parents are gonna do whatever they can (for their children), but I do it for community kids, also.

Alderman Munoz goes on to add that he doesn’t try to get unqualified kids into magnet schools:

I usually meet with the parents to make sure I’m not pushing someone who doesn’t meet the criteria. I don’t want to set up a kid for failure.”

Perhaps I’m being naïve, but I believe the alderman, mostly because the statement is so credible. Just as there are far more kids qualified for admission to, say, Harvard, Yale, or the U of I, than there is room in those schools’ classes, there are far more kids qualified for Chicago’s magnet schools than can possibly be accommodated at those schools. We are not talking about getting dolts into schools for scholars; we are talking about giving a qualified kid all the help he can get toward his goal of getting a great education.

Another alderman, not blessed with Alderman Munoz’s courage and thus unwilling to speak for the record, intoned

Parents interested in seeing that their kids get a good education will go to extreme lengths. There are always people who call saying ‘Can you help?’”

Citing that a letter from a member of Congress is necessary to get into West Point, Annapolis, or the Air Force Academy, this alderman asks

Are we saying it’s okay for members of Congress to help, but the state rep, the state senator and the alderman are not supposed to?”
Great point. Do-gooders and goo-goos might respond with a limp “Well, that’s different.” But they would be at a loss for explaining precisely why that’s different.

A few more thoughts come to mind in the wake of these developments:

--The level of shock at the discovery that clout is used to get kids into a good public school in my home town should approximate the level of shock of a piano player at a bawdy house who discovers that all those guys weren’t coming to the place just to hear him tickle the ivories. We are talking about Chicago, not Minneapolis.

--If I were an alderman (a thankless, but generally quite remunerative perch from which to perform public service), would I make such phone calls for constituents or for one of my kids? Damn right I would. (Would Alderman Eamon DeValera Collins, the protagonist in my upcoming soon to be seminal novel of “Chicago” politics, make such calls? He’d call the principal into his office, pronto, and “reason” with the guy. Release date is getting closer!) Such calls, I think legitimately, come under the heading of constituent service, certainly in Chicago. As the late and legendary Mike Royko quoted an apocryphal but doubtless representative Chicago constituent, “Hey, Alderman! If ya can’t fix your own traffic tickets, how ya’ gonna to fix mine?” The alderman is the public official closest to his or her constituents; he’s the first guy (or woman) the average Chicagoan thinks about or goes to when he or she has a problem.

But wouldn’t a kid who gained admission to Young, Payton, or North Side with the help of a call from a diligent alderman deny admission to an otherwise qualified kid who was represented by a more self-righteous, or perhaps just slovenly, alderman? Maybe. But one of the prerequisites for success in life, one of life’s qualifications, if you will, is the ability and the willingness to take some initiative. Say we have two kids, both qualified academically for one of the magnets. One kid is smart, savvy, and aggressive enough, and/or his parents are smart, savvy, and aggressive enough, to call her alderman for help in gaining school admission and another kid is either naïve or lethargic and figures that his academic qualifications will, and certainly should, get him admitted to the school of his choice. Which one should get the nod? Oh, c’mon, be honest. Okay, if you can’t admit that the first student should get into, say, Payton, which one has the better chance at getting along well in life? Who is more “qualified” for life, if not for school?

High minded aldermen, too “ethical,” or hebetudinous, to help out their constituents, end up getting pats on the back from the editorial boards of the Tribune and the Sun-Times, most of whose members live in the suburbs or in the trendy and high minded 42nd or 43rd wards anyway. Aldermen who are willing to help out their constituents gain whatever help they can navigating life in a sometimes challenging big city get reelected. Aldermen who are honest about such service, like Alderman Munoz, are to be commended for their service, their honesty, and their courage.

SAVE ‘TIL YOU GET UP

8/13/09

A retail industry analyst (I didn’t catch her name—my apologies), commenting on the 0.1% drop in retail sales for July that was reported this morning, stated on the 9:00 AM (Chicago time) edition of the CBS radio news:

Shoppers are now very, very frugal; they’ve learned new habits.”

Most economists will doubtless find themselves sullen and down in the mouth at this newfound frugality on the part of the American people. They will insist that people must “spend again” if we are to ever get out of this economic condition that must not be named but that they are now increasingly sure has ended. But any spurt in spending now would be the economic and financial equivalent of that hefty draw on the half pint of Kessler’s that brings such fleeting relief after a long night of especially brutal binging.

We have a huge debt problem in this country. Household indebtedness reached a record 132% of disposable income in 2007. It has since fallen to 124% of disposable income, causing many deep economic thinkers who only recently have begun to shave to hail, or bemoan, our new sturdy frugality. However, in 1952, the household indebtedness to personal income ratio was 36%. I can hear it now from the solons of Wall Street and academia: “Oh, Quinn, you’re lost in the past. Those were the Ozzie and Harriet Days (and why is that so bad?) that will never return. 1952! Hah! My parents weren’t even born then.” Okay. Maybe, given the historical knowledge and perspective of much of the generation currently in charge on Wall Street, 1952 is about the time Julius Caesar conquered Gaul (or was that when William II conquered England? Same difference. Pass the remote; “Two Men and a Boy” is on.). So let’s try this: The household indebtedness to personal income ratio was 69%, just over half what it is now, in 1985! While most of those people to whom America entrusts its money were still in grade school (if they were that old) in 1985, most of my readers can remember things that happened in 1985 as if they took place yesterday. (That many of us wish we couldn’t is another issue.)

Another eye opener is that our savings rate fell below 0% in 2005 and stayed there for nearly two years. Much to the chagrin of economists and financial solons, as a consequence of the economic condition that must not be named, that rate reached 6.9% in May of this year before falling (and I suppose the deep thinkers consider at least the direction of this move a favorable development) to 4.6% in June of this year. To many financial and economic wiremen, including the likes of Ron Insana (See my newly seminal 7/10/09 post, “IF I CAN’T FIND ME A HONEY, TO HELP ME SPEND MY MONEY, I’M GONNA HAVE TO BLOW THIS TOWN…”), this hefty savings rate is evidence that consumers now have the all clear to go out and start p---ing away money again. But not only are these income statement developments paltry (At their peak, recent savings rates did not quite reach the bottom end of the 7%-10% savings rate range of the post War (That’s World War II for the reigning masters of the financial universe.) years.), they have barely made a dent in the balance sheet travails outlined in the last paragraph.

If anything good has come out of the economic condition that must not be named but is most assuredly, according to the economics profession, over, it has become the newfound frugality that this morning’s retail analyst cited. If we are to blow this attitude adjustment in order to bring temporary relief from our economic difficulties, we will experience consequences roughly equivalent to those experienced by a new AA member who takes a few quick blasts just to fortify his nerves for the date he has made with a comely young lady he met at his last meeting.

If our economy is to remain viable as a going concern, we need a domestic capital base, which means we must begin to save again. There are signs that we are beginning to learn to do so, but only because the economic condition that must not be named has terrified us into doing so. Even saving prolongs our malodorous economic circumstances, we must continue to save. Given the condition of the national balance sheet, temporary relief will be worse than no relief at all but will only exacerbate the precariousness of our economic situation.

Of course, I am not hopeful that the American people have come to regard saving as anything but a temporary hardship that must be endured. (See, inter alia, my already seminal 8/1/09 post, “SOMEWHERE, (BE CERTAIN WITH) LEN BURTON IS SMILING,” my profound 7/13/09 piece “HEY JUDGE, OLD BUDDY, OLD PAL, I’LL PAY THAT HUNDRED I OWE YA’ IF YA’ GET ME OUT OF THIS SPOT…”
and the aforementioned 7/10/09 post.) Now that, as the recession winds down and happy days rapidly return (according to the ever wise Wall Street and Washington types whose familiarity with the average person is akin to the familiarity of a Komodo dragon with the environmental features of Antarctica), the typical American will spend up to and well beyond the limits of his or her income in his or her ongoing efforts to fortify his or her fragile self-image and fill the voids in his or her life with a bunch of junk. Doubtless, the financial experts will hail this as a cause for raucous celebration.

And our defenestration as an economic power, along with the decline of our standard of living will accelerate…to the cheers of Wall Street types who will reap ever fatter paychecks to blow on ever more senseless piffles.

TAKE A DEEP BREATH

8/13/09

Opponents of efforts by the Obama administration and Congressional Democrats to overhaul the health system have entered the twilight zone, suggesting that the plan contains seeds of government sponsored “death panels” and euthanasia courts.

Why the hysteria? Many of the histrionics have their origin in the White House Budget Office’s hiring of Dr. Ezekiel Emanuel, an oncologist and medical ethicist who has taught at Harvard and worked at the National Institute of Health and who is also the brother of Rahm Emanuel (White House Spokesman Ken Baer says Dr. Emanuel’s being Rahm Emanuel’s brother had nothing to do with his hiring. Even if the Emanuel brothers were not from Chicago, one would have a hard time believing that.), as a consultant on health care issues. As an academic and theoretician, Dr. Emanuel is paid to think out loud and consider alternatives without having to worry about the political ramifications of such consideration. (For example, he wrote in a 1996 article that “An obvious example (of ways to save on health care spending) is not guaranteeing health services to patients with dementia.” Notice that he was not advocating denying health care to those with dementia; he only cited it as one of the methods proposed for saving money on health care. (And, in any case, note that he spoke of “guaranteeing,” not “providing.”) If I were to say “One of the ways to cut the federal deficit would be to aggressively increase taxation on those of Irish origin,” does that mean I am advocating increasing my taxes? People ought to be allowed to list, and even consider, egregious alternative solutions to problems without being accused of advocating the approaches they are listing and considering, the latter generally just before dismissing those alternatives nearly out of hand.), but that hasn’t stopped the screechers from seizing his comments as examples of what they consider Nazi like provisions in the health care proposals. For example, in a January, 2009 article, Dr. Emanuel said age could be used as a factor in deciding who gets scarce organs or vaccines. As quoted in the Wall Street Journal (Thursday, 8/13/09, page A4), he stated:

“Unlike allocation by sex or race, allocation by age is not invidious discrimination. Every person lives through different stages.”

What are the ramifications of such dangerous thinking? Say we have a heart, one heart, ready for donation. It can go to an otherwise healthy 25 year old or an otherwise healthy 75 year old. If we consider age in making this choice, we could give the heart to the 25 year old. Most people, including most 75 year olds I know, would favor giving the heart to the 25 year old. A step further: Give the choice to the 75 year old who would receive the heart, and he or she would, in most cases, insist on giving the heart to the 25 year old. Doing so would seem to be common sense and a practical and compassionate application of medical ethics.

Besides the comments of Dr. Emanuel, opponents of the health care reform plans of the Democrats have seized on a provision in proposed health care legislation providing for end of life counseling. Zealots have been screaming that what such counseling would amount to is the government advising people on how to end their lives and, I’m sure someone is saying, a promise of lifetime employment for Jack Kevorkian.

But what’s really going on with end of life counseling? Currently, doctors are not reimbursed by Medicare for counseling on things such as living wills, DNR orders, etc., and hence don’t provide such counseling. As a consequence, in many cases, people were provided no guidance as to how they wanted to be treated at the end of life and therefore were being overtreated, often against their wills. Cecil Wilson, president-elect of the AMA (that notorious bastion of left wing death merchants that also happens to be a major bankroller of the GOP), argues that the provision ensures that doctors will be (Horrors!) paid for their time. He goes on to say of the end of life counseling provisions:

“We were delighted to see this in the legislation. This (demagoguing the issue) is one of the most egregious examples of mischaracterization that I have seen.”

So a White House advisor suggests that age is a legitimate characteristic to consider when dealing with limited supplies of organs and vaccines. Health care legislation contains provisions to pay doctors for counseling patients on steps they can and should take in order to make sure their wishes for end of life care are carried out.

So what do we get from the Republicans?

Minnesota Representative Michele Bachman says

“The president’s adviser defends discrimination against older patients.”

Sarah Palin, never accused of having a thought, let alone an original thought, rails in her characteristic thoughtful, measured tone:

“…my parents or my baby with Down’s syndrome will have to stand in front of Obama’s death panel.”

Champion of all things moral Newt Gingrich piously intones:

“…you’re asking us to trust turning over power to the government, when there clearly are people in America who believe in establishing euthanasia.”

At least one of these wailing hysterians, Mr. Gingrich, has a point. Many people in this country do believe in euthanasia. (Doubtless many people also believe in bestiality.) But if enough people had such facinorous designs on the lives of the elderly, the federal government could easily implement a nationwide euthanasia plan since, through the Medicare program, it already is the provider of health care for just about 100% of the senior citizens in this country.

There are plenty of reasons to oppose Obamacare or Democare, or whatever one wishes to call it, that have their bases in facts and careful thought rather than vacuous talking points and febrile fear mongering. But perhaps, in modern America, where people don’t think because they find it easier to absorb and regurgitate, such demagoguery is the most effective means to derail ill-advised plans to nationalize health care. But one wishes that the more misguided aspects of the plan could be defeated with sound reasoning and logical arguments, not screeching, wailing, and gnashing of teeth. One also wishes, I suppose, for the ability to fly, but, like sound, logical argumentation in 21st century America, such self-avionics are not going to become available any time soon.

Sunday, August 9, 2009

“…WE'RE ORANGE AND BLUE, ILLINOIS, WE'LL BACK YOU SO STAND 'GAINST THE BEST IN THE LAND…”

8/9/09

I have already addressed the U of I admissions “scandal” in my already seminal 6/8/09 post “WE ARE LOYAL TO YOU, ILLINOIS…,” but, since the Chicago, and much of the national, press can’t let go of this “issue, I feel compelled to expand (largely repeat, really) my arguments.

My compulsion to revisit this issue was fed by an article in this morning’s (i.e., Sunday, 8/9/09’s) Chicago Tribune that featured, as a figurative sidebar, comments from students on the Champaign-Urbana campus. The comment of young Mr. Mike Donahue, an aeronautical engineering major from Palos Park ((sort of) south side Irish and a U of I student; how can the kid possibly be wrong?), and an obvious braino, and not only because of his especially challenging major at the nation’s premier engineering school (Take that, MIT!), especially caught my eye:

“The state senators and politicians who were involved should be held to the same standard (as trustees and administrators). You can’t blame the people who don’t have clout for giving in to the people who did. The blame needs to be spread around a little more.”

While the musings of all three students were cogent, the observations of young Mr. Donahue especially added to the already immense pile of evidence that the U of I remains capable of developing students who display both keen insight and wisdom far beyond their modest years.

The lessons of the U of I admissions “scandal” are many:

--Our level of shock that clout has infiltrated the admissions process in the flagship school in the most corrupt state in the union should be approximately the same as Captain Louis Renault’s level of shock that gambling was taking place at Rick’s Café American.

--The notion that the “clout admission” of 800 undergraduate students and “dozens more at the graduate level” somehow dilutes the talent pool, or even significantly impairs the admission chances of “non-clouted” applicants at the 41,000 plus student Champaign-Urbana campus is ludicrous. I say this fully aware that, if you or your child were one of 800 who would have been admitted to that academic equivalent of Valhalla had it not been for some politico’s kid getting the under the table nod, the sense of anger is real and justified, but, statistically, the numbers involved are minuscule.

--The administrators at the U of I, including President Joseph White and Urbana campus Chancellor Richard Herman, should not resign or be fired over this incident. If they lose their jobs in some sort of catharsis seeking witch hunt, those calling for their heads ought to be ashamed of this blatant case of scapegoating. On this note, one should also point out that former law school dean Heidi Hurd’s comments on trading admission to a clout laden applicant for the hiring of students from the dregs of the class rank lists were just as she said they were, i.e., a display of sarcasm and irony laden, and highly developed and sophisticated, wit, not an accession to the outrageous demands of a friend of Governor Blagojevich. Those of us who went to the U of I could pick that up immediately.

--The trustees probably should go and, thankfully, some have gone. While not knowing much of the backgrounds of this current crop of U of I trustees, these sorts of “trustee” posts generally go to an assortment of political lackeys, hangers-on, toadies, and/or heavy campaign contributors as rewards for years of loyal coat holding and/or funds dispensing. The holders of these sinecures generally aren’t expected, and certainly don’t expect, to do much, much like holders of board seats at Fortune 500 companies. In this case, they did one of the few things they thought they had to do: convey the wishes of the guys who got them their posts. They should have known better but, in most cases, were probably not capable of knowing better due to the “that’s the way we’ve always done it” mentality surrounding politics in this state and, in some cases, the low bar involved in acquisition of such plum jobs. If these trustees are let go, I am sure their political sponsors, or sponsees, will find them some other platform for self-aggrandizement that doesn’t involve the nation’s premier public university. (Okay, “one of the nation’s premier public universities.”)

--To Mr. Donahue’s point, if anyone should go as a result of these shenanigans at the U of I, it should be the pols who put the pressure on the trustees who put the pressure on the administrators to admit the whopping 800 clouted students. The Mikva commission dismisses this obvious point by stating that the elected officials who got their friends’ and bankrollers’ kids admitted will have to face the voters. This sounds like a case of former Congressman Mikva protecting his own and those who continue to butter his bread. The voters are too busy watching such nonsense as “John and Kate Had Eight” or “America’s Got Rhythm” to pay the least bit of attention to anything remotely resembling real news. If they vote (And I hope those who consider “Entertainment Tonight” their daily dose of news stay far, far away from the polls on election day.), many, if not most, citizens will make their selections based on whose name sounds best or whose sign they saw most recently before making the trip to the polling place. They won’t remember this scandal; in most cases, they won’t remember the names of their legislators, the governor, their Congresspersons, their Senators, the President, etc., etc. Relying on the voters to address the meretricious machinations of our public servants, especially in the Land of Lincoln, is a quaint notion more appropriate to a time when people considered their responsibilities as citizens more important than the latest developments in the pathetic worlds of vacuum brained celebrities and the equally mentally indolent who follow such things.

Thursday, August 6, 2009

“I DON’T KNOW WHO GAVE THE ORDER; I DIDN’T ASK, BECAUSE IT HAD NOTHING TO DO WITH BUSINESS!”

8/6/09

Illinois State Comptroller Dan Hynes, while not yet formally announcing a gubernatorial bid, sent a letter to supporters today confirming that he is indeed running for governor. Such tap dancing (or, in the case of Mr. Hynes, step dancing, one guesses) around bids for public office has become all the rage; for example, note Chris Kennedy’s as yet unannounced and unofficial, but very real, bid for President Obama’s old U.S. senate seat. But I digress.

Dan Hynes is an impressive and serious young man (See my 6/24/09 post, “THE KID IS ALRIGHT”) who would make a good governor, but his challenge to Governor Quinn (no relation) puzzles me. While Governor Quinn is antagonizing plenty of voters with his far from dead plan for a brobdingnagian increase in the state income tax and Illinoisans are growing tired of Mr. Quinn’s penchant for gratuitous, even for a politician, grandstanding, it is very difficult to challenge an incumbent of one’s own party in a primary for any political office. (See my already seminal 7/9/09 post, “THE STATE REMAINS HER OYSTER,” for background on Mike Howlett and Carol Moseley Braun, the only Illinois two pols in recent memory who successfully challenged incumbents for statewide office. Both achieved their victories, over Governor Dan Walker and Senator Alan Dixon, respectively, under unusual, to say the least, circumstances.) This will be especially true in the case of Governor Quinn, who, by the time he runs for reelection in 2010, will have held office less than two years after ascending to that high post in the wake of the defenestration of the abominable Rod Blagojevich. The “man on the white horse” veneer, while well worn, will not have completely worn off by then. Further, Quinn should continue to get press like this, from today’s Chicago Sun-Times:

Quinn, 60, has spent decades building a reputation as an advocate for taxpayers, a reformer, and an outsider—the man who founded the Citizens Utility Board and cut the state legislature by a third.

Advocate for taxpayers? How does raising our taxes by up to 66% amount to being an “advocate” for us? Cutting the legislature by a third, history has shown, has been the single most debilitating act in the history of Illinois government. CUB has served primarily, some would say only, as a vehicle for Mr. Quinn’s political and personal aggrandizement. Yet, Mr. Quinn remains St. Patrick to the media; it’s hard to see how that will change between now and November, 2010.

Further, given the way things work in this state, one has to think someone gave young Mr. Hynes permission to challenge Governor Quinn. That someone would have to be one, some combination of, or all of the following:

-Mayor Daley
-Tom Hynes, who is Dan Hynes’ father and former committeeman of the 19th Ward, from which both I and Mr. Hynes hail, who remains a political powerhouse in the Ward and in the city
-Jerry Joyce, former alderman and State Senator from the 19th Ward who remains a, if not THE, major political power in the Ward
-Mike Sheahan, former 19th Ward alderman and Cook County Sheriff, ally of Jerry Joyce, and huge power in the 19th
-Jim “Skinny” Sheahan, political operative from the 19th, to whom some attribute the political success of his brother, Mike, Jerry Joyce, and possibly Rich Daley
-maybe Tom Dart, Cook County sheriff, protégé of Mike Sheahan, and rising political power city and county wide
-a cabal of southwest side ward committeemen, including Matt O’Shea, committeeman of the 19th ward, with perhaps a few North Side committeemen and southwest suburban Township Committeemen thrown in for good measure.

All of the above are very smart politicians and doubtless are aware of the difficulty Dan Hynes would have unseating the governor and the advantages of keeping young Mr. Hynes in the Comptroller’s office, which he would have to forego in a run for governor. Further, while none of the above can work up much of a sweat over Governor Quinn, the Governor has been around a long time and knows how to play ball. The Organization guys have learned how to, depending on whom one believes, live with or emasculate Pat Quinn. They also know that, with the state in such poor fiscal shape, it’s better to have an outsider, on whom one can pin the blame, in office when those financial problems are being addressed, almost surely in politically painful ways.

Perhaps more important, one of that cabal of southwest side committeemen from whom Mr. Hynes would need approval would be none other than primus inter pares Mike Madigan, Illinois House Speaker, 13th Ward Committeeman, and the best in the business. Since Mr. Madigan’s daughter Lisa is probably planning a run for governor in 2014 (See my already seminal 7/9/09 post, “THE STATE REMAINS HER OYSTER.”) and would like to run against a by then weakened Pat Quinn, it is hard to see Mike Madigan supporting a challenge to Mr. Quinn by a talented and likeable young man, and hence tougher opponent for Lisa, like Dan Hynes.

Similarly puzzling is the scuttlebutt I am hearing about Kevin Joyce’s, state representative and Jerry Joyce’s son, challenging Congressman Dan Lipinski in the 2010 Democratic primary in the 3rd Congressional district. (This may be more than scuttlebutt; it might be common knowledge, but I haven’t seen it in the papers.) While many in the 3rd district do not feel warm and fuzzy about Dan Lipinski both because they feel, with plenty of justification, that he is a carpetbagger and because they find him too conservative, or at least too willing to work with Republicans, for the tastes of most mainstream Democrats (though one would think that, in the lunch pail Democrat 3rd district, his relative conservatism would be a big plus for Congressman Lipinski), a Joyce challenge not only would be a case of challenging an incumbent of one’s own party in the primary, but also would represent a battle of the 19th ward, and Jerry Joyce’s kid, against the 23rd Ward, and Bill Lipinski’s kid. It would also fracture the Polish/Irish alliance that has been so successful both in the 3rd district and in the city in general. If young Mr. Joyce does go through with a challenge to young Mr. Lipinski (and, implicitly, old(er) Mr. Joyce goes through with a challenge to old(er) Mr. Lipinski), this would be all out war. While, even in the case of such a thermonuclear conflict, the GOP has no chance in this district, it would not be at all good for the Democratic Party in Illinois and one would think that the powers that be would put the kibosh on the ambitions of young Mr. Joyce and young Mr. Hynes.

There could be two possible reasons that the challenges, actual and possible, of Messrs. Hynes and Joyce might make sense. First, they could be part of the same deal, a deal that neighboring committeemen have made with the increasing powerful, and hence scary, to them, 19th Ward. The deal would run along the line of “We’ll back your boy for governor if you keep your other boy away from our Congressman. Deal?” Such a deal would contain a deliciously Machiavellian twist for Mike Madigan. It would not only keep his friend and neighbor Bill Lipinski’s kid in office, but it also might throw an at least temporary monkey wrench into the career of Dan Hynes, an obvious challenger to any ambition Lisa Madigan may have. Mike Madigan knows how tough a Hynes challenge to Quinn would be and thus that such a challenge is likely to fail. Not only would Hynes be humiliated politically, but he would lose the Comptroller’s office, his platform for moving up the political ladder, and the 19th Ward would be taken down a notch. Mr. Madigan, being the pragmatic politician he is, has worked well with the 19th over the years and he certainly feels a cultural affinity for his fellow South Side Irish who dominate that ward. However, he can’t be happy to see the 19th accumulating so much power. As an ambitious and smart politician, he can’t help but think such concentration of power has been coming at the expense of his 13th, and possibly John Daley’s 11th, wards. Even allies can get uneasy about each other.

Perhaps this is all nonsense. Perhaps the Organization is dead. We all know that the Cook County Regular Democratic Organization, as a formal entity, is moribund. (Even I, something of a student of these things, had forgotten that Joe Berrios is now the head of the Cook County Regular Democratic Organization; I had to look it up on the internet. There was never any doubt who was in charge when, say, Tony Cermak, Pat Nash, Jake Arvey, Richard J. Daley, George Dunne, or Ed Vrdolyak ran the County political machinery. Even Tom Lyons was recognizable in that post.) Maybe the Mayor is telling the truth when he says he does not get involved in Democratic primary politics. Perhaps he and his political braintrust, Tim Degnan and Jerry Joyce, never get together and plot political strategy but only get together in the interest of good and effective governance. Maybe committeemen like Mike Madigan, John Daley, Joe Berrios, and Matt O’Shea don’t spend time, inside or outside the formal machinery of the County Regular Democratic Organization, discussing which horses to back in the various primaries and really can’t deliver, as the media sometimes like to tell us, even if they did. Perhaps the Mayor never sends representatives to such meeting, which may or may not take place. If this is the case, Mr. Hynes is freelancing, figuring that his $3mm campaign war chest, can help him in the, as Al Neri would put it, “difficult, not impossible” task of unseating a new incumbent governor who sports a media installed halo, and Mr. Joyce is counting on the district’s discontent with Dan Lipinski, and Jerry Joyce’s prodigious fundraising ability, to topple an incumbent Congressman of his own party.

Maybe all that is true, and there is no “Organization,” no “they,” to bring order to the chaos that would result from a Hynes challenge to Quinn and a Joyce challenge to Lipinski. But I still like the former explanation (a deal between the 19th Ward and the rest of the 3rd congressional district’s wards involving Dan Lipinski, Dan Hynes, and Kevin Joyce, a deal that could work out very well for the Madigans) more. Or maybe there is a third possibility: Mr. Hynes moved too fast without the proper authorization, and someone, perhaps Dan Hynes’ own dad, will take him out to the woodshed and tell him to stay where he is for the good of the Organization that has been so good to all these families.

Sunday, August 2, 2009

BASEBALL, HOT DOGS, APPLE PIE AND TOYOTA?

8/2/09

This morning’s (i.e., Sunday, 8/2/09’s) Chicago Tribune’s “Rides” section featured an article by Steven Cole Smith on domestic content of vehicles sold in the United States, as measured by Cars.com. While using some dubious criteria, especially factoring in sales volume in the calculation of domestic content, the article was enlightening, especially for those who insist on buying Big 3 cars in the interest of “buying American.” Shockingly, to those who don’t follow the industry closely, of the top 10 U.S. content vehicles, according to the Cars.com criteria, five bore Japanese nameplates, and the Toyota Camry had the highest domestic content. (By more logical criteria, the Ford Taurus, assembled on that Athens of the Third Millennium, the south side of Chicago, would come in first.)

More interesting, though, was Mr. Smith’s pointing out that many make the argument that one should buy a Big 3 nameplate because

“…the money you spend on an F-150, for instance, is likely to stay at Ford’s headquarters in Dearborn, Mich., while a lot of the money spent on a Camry will be shipped back to Japan.”

This reasoning is specious, disingenuous, laughably lacking in knowledge of basic finance and economics, or a combination the first and the third, for a number of reasons.

First, there is a LOT more labor cost in an automobile than there is profit in that same automobile. Therefore, if the car is assembled here from parts manufactured here, the lion’s share of the money spent on the car goes to the American workers who made it. The profit per car is relative peanuts compared to the labor cost of the car.

But what happens to that relatively small amount of dollar profit made on each car? Finance 101 tells us that a corporation can only do two things with a dollar of profit: it can either pay that dollar out in dividends or it can reinvest that dollar in the company’s operations. None of the Big 3 is currently paying dividends, and, if they were, a substantial chunk of those dividends, in the case of one of the Big 3, would go to a foreign company, Fiat. Since the Big 3 are not currently paying dividends, if the foreign manufacturers are paying any dividends (They are.) and they have any U.S. shareholders (They have plenty.), that share of their profits going to U.S. investors greatly exceeds (by infinity, currently) that share of Big 3 profits (There are none currently.) going to U.S. investors.

Even if and when we return to a “normal” situation, in which the Big 3 all have private shareholders and pay out dividends from profits, we will not be able to assume that all Big 3 dividends go to U.S. investors and all the dividends of foreign manufacturers go to non-U.S. investors. Under “normal” circumstances, GM, Ford, and Chrysler have plenty of foreign investors; indeed, Chrysler will probably emerge more or less wholly owned by Fiat. Further, Toyota, Honda, Nissan, BMW, Daimler, VW, etc., have plenty of U.S. investors. Admittedly, the concentration of U.S. shareholders should be bigger in the Big 3 than in their foreign competitors, but, still, plenty of the foreign carmakers’ profits will find their way to American citizens in the form of dividends.

What about those profits that are not paid out in dividends, but, rather, are reinvested in the company? Don’t those U.S. dollars wind up in Japan when spent on, say, Toyotas and wind up in the U.S. when spent on, say, Chevys? No. Who has been the most aggressive in investing in U.S. auto plants of late? The easy answer is “Nobody,” because, over the last year or so, no one has built any new plants here. However, over the last, say, five or ten years, it is the Japanese, Koreans, and Germans who have been aggressively building plants here, with Toyota alone having built several mega-plants since the turn of the millennium. While the domestics have spent plenty of money retooling existing plants, they have built few, if any, new plants over the same time period and, on a net basis, have shut down far more plants than the Japanese and Koreans have built. At the same time, GM has, understandably, aggressively added new capacity in China. Remember, these are all multinational corporations with multinational capital budgets. But, as of the last ten years or so, the Japanese, Germans, and Koreans have been investing heavily here while the Big 3 have been disinvesting here and investing heavily overseas.

So most of the money spent on a car goes toward labor. If that labor is U.S. based, most of the money spent on a car stays here. As far as the relatively small profits per car are concerned, they either go to shareholders, who can be domiciled anywhere for any of the multinational car companies, or they are reinvested in the company’s operations. Of late, those investing here have been foreign companies while those disinvesting here have been U.S. companies.

No one should be buying a car based on the faulty reasoning that a dollar spent on a Big 3 product is “good” for the U.S. while a dollar spent on a foreign nameplate is “bad” for the U.S. economy. If one is concerned about the impact one’s car expenditures have on the U.S. economy, one should pay attention to the domestic content of the car one is buying, not the nameplate the car bears. Money spent on, say, a Honda Accord built in Ohio, or a Mazda 6, built in a UAW represented plant in Flat Rock, Michigan, is far more likely to have a beneficial impact on the U.S. economy than money spent on a Ford Fusion, built in Mexico, or a Pontiac G-8, built in Australia. All four of the aforementioned, by the way, are terrific cars, no matter where they are built, and, unless one puts an inordinate amount of consideration into country of origin, any would be a great purchase.

Saturday, August 1, 2009

SOMEWHERE, (BE CERTAIN WITH) LINN BURTON IS SMILING

8/1/09

I have to admit that I was caught flat-footed on the details of the “cash for clunkers” program, perhaps because we were away so long and I was out of touch with the news. But most of the details of the program came out before we left, so I can only attribute my lack of detailed knowledge of the program that has had such a profound effect on an industry about which I purportedly have a degree of expertise to inattention, probably because of my concentration on my book. I also have to admit that I was flabbergasted by the phenomenal success of the program; it appears that, in cash for clunkers, we are observing, or have observed, that rarest of all species, a successful government program. As regular readers may suspect, I also have managed to find a dark cloud inside the silver lining of this program; this ability to find the downside few others detect and my surprise at the success of the program are related.

To understand my amazement at the success of the cash for clunkers program, one must understand what the program does: it puts a floor under used car prices. That floor depends on the step-up in fuel economy the participant achieves when he effectively trashes one’s car for a new one. (That step-up, in the case of “large light trucks,” can be as low as 1 mile per gallon, exposing as so much balderdash the argument that cash for clunkers is some kind of miracle elixir for either our dependence on foreign oil or for our environmental problems. This program sells cars, but doesn’t do much at all for the national fleet’s fuel economy.) Say the participant’s old car is worth $2,000 and she qualifies for the full rebate of $4,500. She effectively is getting a government subsidy of $2,500 for the purchase of a new car. $2,500 is nothing to denigrate, but does it make all that much difference when the participant is buying a $20,000, or even a $15,000, car? (Don’t pretend that one can buy much new car at all for less than $15,000, even, or perhaps especially, given the drain down in inventories, now. And I would be willing to bet that the price of the average new vehicle purchased under the program exceeds $20,000, and not by a few dollars.) How many buyers are that close on a car buying decision? How many could say “Gee, I could never in a million years afford $18,000 for a new car, but $15,500? Easy.” Apparently legions of buyers are in such a position, if we are to believe the apparent success of the program. Further, how many people could not get financed for $18,000 but are suddenly creditworthy for $15,500? What happened to the “credit crisis”? Was it all a figment of our collective imagination? Or is the Obama economic plan having a Merlinesque effect on our economy, making all our financial problems disappear? One wonders.

The dollar amount of the subsidy, of course, depends on the value of the trade-in and the step-up in mileage the participant achieves when he ditches his old friend for his new infatuation. We don’t yet know how much the average subsidy is. However, the Wall Street Journal informs its readers this morning that at one dealer, Vernie Jones Ford of Jasper, Georgia, the average value of the clunkers taken in was $4,200, making the maximum subsidy a mere $300. Jones is only one dealer, of course, and is unlikely to be reflective of conditions nationwide. However, if Jones’ experience is even remotely close to the nationwide experience, the numbers outlined in the last paragraph would be even more supportive of my amazement at the apparent success of the program and my ability to concentrate on its more malignant aspects.

When one gets down to it, the value of the program is not the dollars themselves, but the cash for clunkers boondoggle’s ability to draw people into showroom and get them thinking about buying cars. Indeed, many dealers report that people who found they didn’t qualify under the program’s rules wound up buying a new car anyway. In this sense, the program succeeded by playing on Americans’ natural inability to keep money in our pockets, or in our bank accounts. The Wall Street Journal reports, for example, that South Carolinian Mr. James Dunn, on the last day of his job, took his severance check and his 1989 pickup to Dodgeland of West Columbia in the Palmetto state to buy a new car because of the program and his “sudden optimism about the U.S. economy.” Mr. John Weiskirch, from parts unknown, or at least unreported by the Journal, is quoted as saying “I’m watching my 401(k) recover a little bit. I’m feeling like the Dow’s going over 10,000 and the NASDAQ’s going over two (thousand). I’m feeling a little more optimistic that I can get a car and my job’s not going to disappear in the next six months or a year or so.” So he went out and bought a new car under the cash for clunkers program. One would think that if an individual thought the stock market were going to perform so splendidly, he would put his money into stocks, not a new car. Admittedly, both Mr. Dunn and Mr. Weiskirch needed new cars; their formerly current vehicles were old, and Mr. Dunn’s pickup had 300,000 miles on the clock. (doubtless one of those “pieces of junk” that the Big 3 have been foisting on the American people) The conditions of their vehicles were reason enough to be looking for a new dream machine. But it looks like a little bit of an incentive, combined with the propensity of Americans to take anything as an excuse to spend money, were the deciding factors in both these gentlemen’s decisions.

That is the ultimate dark cloud in the cash for clunkers program: it exposes the fact that we have not gotten over our compulsion to blow every dollar we have, and then some, with even the slightest of incentives. The consensus of the vast majority of eminent economists, and even of practically thinking people, is that such spending is what we need to get out of our economic quicksand. There probably is something to that argument. But, as I have said ad nauseam in the past, if this economic situation that must not be named has had any beneficent effect, it has been its having increased our savings rate temporarily and perhaps causing Americans to reexamine their attitudes toward money. It looks like the second was an illusion, and that is a shame. An economy can not subsist on wild, irresponsible spending. Savings and capital formation are the keys to long term economic viability. And it looks like Americans will treat the former as a plague to perhaps be endured temporarily and the latter as yet another task that we can outsource to our overseas friends.

WITH ENEMIES LIKE THIS, WHO NEEDS FRIENDS?

8/1/09

There is much discussion lately of liberal Democratic frustration and/or disenchantment with either or both the inability of the Obama administration to achieve the type of “change” envisioned in the halcyon days of the immediate aftermath of the 2008 election and/or the ability of a relative handful of “conservative” Democrats to stall the more febrile enthusiasms of the Democratic left. There has been insufficient action, the base of the Party seems to be saying, on health care, the environment, financial regulation, and a whole host of other things near and dear to the hearts of believers in uber-government.

One interesting theory regarding the origins of the snail’s pace of the left’s aggressive agenda is that Rahm Emanuel’s 2006 strategy of recruiting “conservative” Democrats to run for Congress and thus achieve a solid Democratic majority in both houses of Congress has backfired. Now, the theory goes, those “blue dog” (or whatever label is now being used for them; doubtless the monikers being employed in the salons of, say, the tonier districts of San Francisco or Boston, are far less charitable) Democrats are delaying, depending on whom one talks to, the president’s or the “real” congressional Democrats’, agenda.

There is doubtless something to that theory; those who insist on sobriety and clear thinking often spoil otherwise riotous drinking debauches. However, what the “core” Democrats fail to see, or to admit to themselves, is that their great congressional victory of 2006, and Barack Obama’s ascendance to the presidency in 2008, was the result of the average American’s thorough disgust at the idiotic, bumbling, smirking, and generally smarmy and increasingly creepy George Bush, not some sudden desire for the full Democratic government knows best agenda.

The Democrats have George Bush to thank for their control of two branches of the federal government. They don’t realize that yet, but I would be willing to bet that they will see the light long before the Republicans, or at least the leaders of the Republican Party, do.