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Government Gives, Free Markets Take

Continuing the analysis of the 9/11/01 terrorist attack on America....

Government fights terrorism...
As Ronald Brownstein explains, government exists to serve the people in the best—not cheapest—way possible. From the LA Times, 9/19/01:


The Government, Once Scorned, Becomes Savior

At the moment the first fireball seared the crystalline Manhattan sky last week, the entire impulse to distrust government that has become so central to U.S. politics seemed instantly anachronistic.

The erosion of faith in the federal government has been probably the most profound change in America's political landscape over the last generation. In a 1964 University of Michigan study, 62% of Americans said they trusted the federal government to do what's right most of the time. By 1994, that figure had dwindled to 19%. The number has rebounded some since, but those with little trust in Washington still exceed those with much.

From Vietnam and Watergate to Iran-Contra and fund-raising scandals in the 1990s, the federal government has contributed plenty to its own declining esteem. But from every angle, Americans have been bombarded with messages that stoke their skepticism. Reporters search through every cranny for signs of waste or scandal (while saying little about programs that produce positive results.) Business lobbyists joke that the scariest words in the English language are: "I'm from the federal government, and I'm here to help you." Maybe those weren't the scariest words for survivors stumbling out of lower Manhattan on Sept. 11.

Routinely along the way, political leaders—especially on the right—have hacked away at these fraying bonds of trust. Ronald Reagan made a career of belittling the government he headed: "Government," Reagan famously said, "is not the solution to our problem; government is the problem." Similarly, House Majority Leader Dick Armey (R-Texas) has been fond of saying: "The market is rational and government is dumb."

President Bush isn't that instinctively hostile toward Washington, and he's been a unifying figure in this crisis. Yet in the past, even he drew a corrosive line between the American people and their government. During last fall's general election, that division was at the core of Bush's case against Al Gore: "I trust the people," Bush insisted in his biggest applause line, "he trusts the government." Last month, Bush reprised that line to contrast himself with congressional Democrats. Only days before the attack, Bush was arguing that the shriveling of the federal budget surplus was a good thing because it meant Washington would have less money to spend on public programs.

Yet in the attack's dizzying aftermath, where did almost all Americans turn for answers if not to the federal government? That instinct extended far beyond the actual physical defense of the nation—a responsibility that almost all Americans, left, right or center, accept as a legitimate function for Washington. More telling has been the instant push in both parties for the federal government to replace the airlines in providing airport security. As soon as Thursday, a bipartisan coalition led by Sens. John F. Kerry (D-Mass.) and John McCain (R-Ariz.) plans to introduce legislation to make that shift. "It is the most efficient and effective way of guaranteeing the security you want," Kerry says.

Consider that a moment. For decades, the message to the public from much of the media and political system has been that Washington is awash in waste and corruption, especially when compared with the sleek efficiency of private industry.

Yet given the critical responsibility of safeguarding the skies, private companies apparently have cut corners and cut costs as they inevitably balanced concern about the general welfare with their need to generate a profit. Now, the widespread assumption is that the federal government, unconcerned with profit, will provide a more thorough and effective defense against hijackings or bombings. "It's the public policy equivalent of a flight to blue chips in a turbulent stock market," says Bruce Reed, the chief domestic policy advisor under former President Clinton.

The lesson is twofold. While government indeed can learn about efficiency from the best businesses, some public services—education comes to mind—are still best provided by public institutions that don't need to turn a profit. And while U.S. industry has proved brilliant at creating wealth and inspiring innovation, it's naive (or disingenuous) to expect private companies to operate entirely in the public interest. It will be worth remembering last week's breakdowns in airport security the next time some politician condemns federal environmental, workplace or food safety regulations and insists industry should be trusted more to police itself.

The point isn't that big centralized government programs are the solution to all American challenges. In both parties, the most innovative programs over the last decade have tried to use government with a lighter touch, as a catalyst to help other institutions (such as local governments or faith-based charities) confront problems. In many cases, it makes sense to expose public institutions to some level of market pressure—by increasing competition for the public schools with charter schools, for instance. But on some critical needs, like educating our children, safeguarding our retirement or, now, policing the skies, there may be no alternative to government shouldering the central responsibility.

It's times of tragedy that expose the hollowness of the manufactured disdain for government. In 1995, the Oklahoma City bombing exploded the illusion that government was filled with "jackbooted thugs" bent on stealing our liberty. The dead and maimed government employees at the Alfred P. Murrah Federal Building spent their days processing Social Security checks or the health care needs of veterans. People whom politicians might have described with a curled lip just a day earlier as bureaucrats turned out to be the men and women next door.

This crisis should teach a similar lesson: It's simply misguided to see the federal government as something divisible from America, when it is in fact the tool through which we meet collectively the challenges that we can't handle alone. It obscures that basic truth to suggest we must choose between trusting government or the people. "In time of crisis," notes Reed, "we realize that the people and government are one and the same." The tragedy is that it took so much private pain to remind us that sometimes public actions through government aren't the problem—they are the solution to our problems.

Copyright 2001 Los Angeles Times

...while free marketers embrace it
John Balzar explains that while the government swung into action to combat terrorists, save lives, and rebuild dreams, free-market capitalists swung into action for themselves. They colluded with the terrorists to wreak havoc to the American economy. From the LA Times, 9/19/01:

They Bet Against America

A stranger walked through my neighborhood and planted American flags in the yards of every house on my block. The feeling of our community closing ranks didn't last long, though. The next thing I knew, these and other flags across the nation were being mocked by a loathsome group that for too long has held esteem in our country and purported to define its national purpose.

I am speaking of Wall Street and its disciples: that grim gambler's den that rushed to bet against us.

The profiteers failed the first test of patriotism in 2001.

They short-sold their country. Cowards, they ran.

I'm going to join the lunch-bucket brigade, the soldiers and sailors and airmen and Marines, the flag-wavers and New York firemen and legions of volunteers who have given something of themselves on this one. Right now, in the middle of September 2001, we needed to feel the country pull together, not just with slogans but in deeds. We needed to shake off our collective cynicism about ourselves.

Many tried. Not the profiteers. A curse on their house.

I'll be quick to acknowledge the mixed blessings of patriotism. It can run away with us and blind us to good judgment. But patriotism is also the way we express our collective hopes when we're under siege.

This week, eyes went to Wall Street. Congress, the Federal Reserve and the president, and many of us on the sidelines asked for a little backbone among the investor clique. Congress rushed to signal that it would bail out the airlines. The Fed cut interest rates for the eighth time this year.

Investors? They grabbed what they could from the moment and skittered off. They didn't think red, white and blue, only green. In a far-off bunker somewhere, Osama bin Laden had a second reason to rejoice.

For days and months ahead, what this nation does with its patriotism will test our levelheadedness. For the moment, though, patriotism is the measure of whether we believe in ourselves, collectively. Or do we still see the country as chiefly some opportunity for shrewd individuals to exploit for personal gain? Wall Street gave its answer.

Don't even try to talk to me about "market forces." If other Americans answered to market forces alone, TV networks would have showed ads for toilet paper last week instead of absorbing huge losses to carry the story uninterrupted. Newspapers would have shrunk instead of expanded. Strange, isn't it? The "liberal media" sacrificed at the bottom line. Too bad the hustlers of the stock markets couldn't even hold fast.

If rescue workers thought like the big-money investors, they would have bet against saving any lives and resumed their eight-hour shifts. If F-16 pilots over Iraq had no more guts than Wall Street, they'd figure the odds of enforcing a no-fly zone are lousy and report to sick bay. And thank God it wasn't big-time Wall Street investors on United Airlines Flight 93 or no one would have fought off the hijackers and that airplane, too, would have reached its target.

Instead of showing bravery, investors served up a record number of sell orders. The realm of bulls and bears turned out to be a field of sheep. Yes, there were some who stood firm. But they were dragged down by the overpaid mutual fund managers who led the retreat, by the brokers who churned orders as they spread fear, by the hedge fund players who could see no further than the closing bell, by the individual investors who let themselves be stampeded: Hey, terrorism is one thing, but this is Money!

A small example: These same investors who were glued to their TVs and who scooped up newspapers in a frantic effort to keep informed promptly drove down the value of these same media companies—Wall Street's twisted rewards for American enterprise.

At least it wasn't panic, the analysts said. We are supposed to be reassured that they didn't go completely berserk? Good news, general! Our crack Wall Street troops only yielded 7% of the value of this nation's publicly held industry on the first day they were summoned to battle.

Now can you imagine, lowering the capital gains taxes on money earned by those who play this market against us? This is blood money.

If you're one of those who bet against America this week, one of those renegades who, like the terrorists, answered first to your own god, The God of Gain, then hurry out and make sure someone didn't mistakenly stick a flag in your yard. If so, pull it up and hand it over to a patriot who deserves to fly it.

Copyright 2001 Los Angeles Times

Others agree with Balzar

We've all heard the plea to let the market's wisdom rule, that the market will best guide us to what is in society's interest. The Sept. 17 stock market plunge showed that the market has no loyalty, no collective aim and is totally amoral in its movements; the only value being pursued is shareholder value.

We have seen the American people come together in many ways in the wake of this tragedy but, though undoubtedly proclaiming their patriotism, those investors who voted with their dollars to gut the economy displayed more self-interest than national interest.

Ken Edwards, letter, LA Times, 9/20/01

Balzar is right on with his commentary spotlighting the lack of confidence and patriotism Wall Street has in America. Next time these money grubs come whining for a capital gains tax cut, i.e., an income tax break for themselves, tell them to get to the back of the line, behind the firefighters, police, rescue workers, volunteers, construction workers and everyone who pulled together in this time of need.

Jeff Hornacek, letter, LA Times, 9/21/01

Balzar spoke to my heart with his commentary on the Wall Street scoundrels who sank the stock market on the first day of trading since the WTC and Pentagon attacks. He is right. Stock market gamblers showed that they have zero allegiance to any country. Let's take this as a wake-up call. Speculators have no place in our American financial affairs. While we are at it, let's stop idiotically praising the mobility of capital. People with money must be forced to decide where their bucks are going to stop.

Bill Gallagher, letter, LA Times, 9/21/01

How much do you want to bet that if the war profiteers had known about the attacks in advance, they would've sold stock short as Osama bin Laden allegedly did? Ironically, while sending stocks plummeting and furthering America's distress, these "Americans" may have helped fund the next death-dealing terrorist scheme.

This is an example of how free-market libertarianism equals anarchy. Capitalists and their paid stooges (politicians) kept government leashed, thus ensuring we wouldn't have enough security or intelligence to stop the terrorism. The result: anarchy at the World Trade Center.

Rob's comments on capitalism
A few of my mini-critiques of conservative capitalism in this time of crisis:

I see the major airlines are asking our government for an emergency handout. Oddly, that's exactly what the classic welfare mother does: turns to government in her time of trouble. Ironic how everyone believes in free markets except when free markets don't work. (9/17/01)

I haven't heard any "conservatives" or "libertarians" call for smaller government in the last week or so. I guess they've crawled back into the woodwork for now. (9/19/01)

Boeing sacrifices for itself, not for the USA:

I guess Boeing's executives didn't hear the calls for Americans to pull together and present a united front. Barely a week after 3,000 people died in a horrifying cataclysm, Boeing has opted to ruin another 30,000 lives rather than sacrifice profits for the good of the country. Is there a better example of the capitalist system's amorality—the very amorality many non-Westerners are protesting? (9/19/01)

Q:  How many people does it take to screw in a light bulb at the World Trade Center?
A:  None. They're selling all the light bulbs on eBay. (9/17/01)

More on our socialist airlines
More comments on the airlines that, like countless "believers" in free markets before them, have sought tax breaks, subsidies, and bailouts whevever things don't go well:

Re "Battered Airlines Seek Immediate Federal Aid," Sept. 19: The airlines have been the major obstacle to providing additional security. The FAA has made numerous studies making complaints about the security on U.S. airliners and in airports.

Now, to add insult to injury, the airlines want a government bailout due to the terrorist attacks and the bad economy. In the interest of national security, I have no doubt that they will be bailed out. After all, isn't that what free enterprise is all about?

Mayer Gerson, letter, LA Times, 9/21/01

I viewed with grim distaste the rush of airline CEOs to Congress pleading for U.S. funds to bail them out of their present financial plight (Sept. 19). These are the same people who have stiffed the airline passengers with service that ranged from indifference to insolence, whose announced schedules are changed without notice and who unilaterally reduced commission levels of travel agents. Now, as a U.S. taxpayer, I am asked to throw them a lifeline.

David H. Wallace, letter, LA Times, 9/24/01

So, the airlines want a multibillion-dollar bailout. But as I understand it, the airlines (not the government) were responsible for airport security and screening of passengers and their carry-ons at Boston, Dulles and Newark. Through the years, experts (including the FAA's own inspector general) have pointed out how bad security is at U.S. airports, yet the airlines have stubbornly resisted proposed rules for beefing up security. Yes, the airlines appear to be vital to the nation's economy; I would describe that as a public trust. Are airline executives being held accountable for their mistakes? Or do they get fat salaries and bonuses as usual? I say, no bailout until there is some kind of true accountability.

Michael Scofield, letter, LA Times, 9/21/01

As we are considering providing assistance to airlines in financial trouble, I presume that Congress will mandate that any aid is accompanied by a substantial sacrifice on the part of the top executives of these companies. The average salary for major corporate CEOs was $20 million in 2000, and rising. This taxpayer would not be pleased to see such excess in any recipient of corporate welfare.

Ken Lanxner, letter, LA Times, 9/21/01

As the Times reported, the airlines and their lobbyists fought tooth and nail against security regulations proposed by the Clinton/Gore administration. Given a choice between sacrificing dollars and lives, the greedy capitalists put 3,000 Americans on the altar, handed box cutters to the religious fanatics, and said "gut 'em."

Rob, letter to the LA Times, 10/8/01

Other capitalists want handouts too
From the LA Times, 9/28/01:

The Airlines Aren't Alone in Seeking Federal Relief

Lobbying: Industries from car rental agencies to insurance firms say business is suffering. Some concede that their timing is awkward.


WASHINGTON — Barely a week after the government bailed out the beleaguered airline industry, other industries are flooding Capitol Hill with appeals for help from a Congress that suddenly seems to be throwing financial restraint to the wind.

From travel agents to farmers, from railroads to the people who make airplane meals, a vast array of groups have lined up with their hands out. Most are seeking relief from problems caused directly or indirectly by the Sept. 11 terrorist attacks, but some cite the tragedy's aftermath as a new basis for positions held long before the World Trade Center was reduced to rubble.

"The fun has just begun," said an acerbic Sen. John McCain (R-Ariz.), a critic of special interest lobbyists. "There's no train that leaves this station that they don't want to climb on." The swarm fulfills the predictions of many lawmakers, who warned that Congress's approval of $15 billion for the airline industry last week would bring other industries and special interests out of the woodwork.

Still, lobbyists are painfully aware of the awkwardness and risks of pushing too hard under these trying circumstances. At a time when the national interest looms so large and urgent, it's not easy being in the business of pushing special interests.

"It brings up the question of relevance," said Maria Berthoud, a lobbyist for the Independent Insurance Agents of America. "Do they want to hear about our problems . . . when thousands of people have just died?"

The lobbying scene also provides another measure of just how thoroughly Washington has been transformed by the terrorist attacks. Just about every proposal is now cast in terms of its relationship to Sept. 11. Trade legislation is suddenly being sold as a way to build bridges to poor nations that are a breeding ground for terrorism. Energy legislation has become a way to shore up national security.

Lobbyists pushing causes that cannot be recast in such terms have been abruptly sidelined. A key lobbyist for adding a prescription drug benefit for Medicare, for example, says he has little to do but wait for that issue to return to center stage.

"Compared to what happened on the 11th, that issue is pretty small," said Marty Cory of AARP, which lobbies on behalf of the elderly. "But at some point the domestic issues will reemerge."

Farm groups were not so reticent. Just before the attacks, the House had been poised to take up a $167-billion bill to expand agricultural subsidies. Fearing their interests would be swept off the table, 21 farm groups wrote to House Republican leaders this week to urge them to vote on the farm bill soon.

But the biggest, most concerted push for relief has come from interest groups and industries that claim to have suffered from the terrorist attacks, the subsequent grounding of commercial airplanes and the heightened security demands that have flowed from the crisis.

Rep. John L. Mica (R-Fla), chairman of the House Transportation aviation subcommittee, said he has been "inundated" with requests for assistance.

"We're compiling a most-injured list," he said. "We're trying to see that the most severe cases get immediate attention."

The airline industry rose straight to the top of that list because the federal grounding order forced them to suspend business for three or four days. And lawmakers wanted to move quickly to shore up the industry because the nation's economy depends heavily on a working air transport system. The next big push, especially among Democrats, has been to provide unemployment and other benefits for workers who lose their jobs because of the airline industry's financial distress.

But that's not all.

Mark Buse, Republican staff director of the Senate Commerce Committee, says the panel has heard pleas from practically every industry that was even remotely affected by the grounding of flights—concessionaires in airports, companies that run airport shuttle vans and hotels and cruise lines that count on planes to deliver their customers.

Travel agents have been especially bold. They have asked for $4 billion in grants and no-interest loans. Peter M. Ruden, a top official with the American Society of Travel Agents, told a recent House hearing that the industry would lose 100,000 jobs. "Business is at a standstill," he said. "The nation's travel agencies face the same unprecedented financial crisis that the airlines face."

The companies that provide in-flight meals to air passengers are also suffering, and the industry is seeking $150 million in assistance plus $625 million in low-interest loans or loan guarantees. Food providers say they have suffered a double-whammy: fewer flights and fewer passengers on each flight.

Airports themselves also face economic hardship, and executives are asking the federal government to help pick up the cost of stronger security measures. With Los Angeles International Airport facing heavy financial losses, Mayor James K. Hahn sent a letter to President Bush urging economic relief for airports.

Most of these industry-specific requests are a long shot in Congress. Lawmakers seem more inclined to help a broad array of industries with general economic-stimulus legislation.

Other business groups have been more reluctant to push their wish list—at least in public. Said Dan Blankenburg, a lobbyist for the National Federation of Independent Business: "Our folks really believe this is a national crisis, and it's not the time to quibble over what provision you get in the tax bill."

Copyright 2001 Los Angeles Times

Bush favors the handout approach
From the letters to the LA Times, 10/19/01:

Wartime Tax Cuts Are Contrary to Sacrifice

Re "GOP Bypasses the Bipartisan Truce," Oct. 14: A war calls for sacrifice, but by backing the so-called economic stimulus package from the House Republicans, President Bush wants America to believe that there is no need to sacrifice.

For those with jobs, who can best afford it, there is no sacrifice; indeed, there is a reward. If Bush were serious about the war on terrorism, rather than only serious about rewarding his supporters, he would be calling for a wartime tax surcharge, with the additional money being devoted to fighting terrorism and all its effects.

Rather than tax cuts, we should have new programs to enhance security of transportation and health systems without destroying our freedoms. Rather than tax cuts, we should have new programs to promote the American ideals of liberty and civil rights throughout the world. Rather than tax cuts, we should have new programs to employ the thousands of skilled workers thrown out of jobs. Rather than tax cuts, we should have programs to provide food to those suffering from oppression and thus support American farmers.

Rather than a new approach to a new, serious threat, we have been given the same old approach of "cut taxes and everything will be better" that left us with a massive debt and a society clearly vulnerable to terrorism.

Los Angeles

And from the letters to the LA Times, 11/7/01:

OK. I've supported President Bush after Sept. 11 in our endeavors against terrorism, and I have complimented him on his conduct of our efforts in Afghanistan. What I don't like is his continued effort, now using the patriotism mantra, to turn our country into a plutocracy: bailouts for the airlines, but none for the laid-off airline employees; more large tax breaks for business, but few for workers (witness no extension of unemployment benefits); children of the now-unemployed without health insurance, but no relief planned by either party in Congress. Let's address the problems of the people. Put money in the hands of people who will spend it. That is what will spur our economy.

Huntington Beach

Capitalists enjoy free lunch at terrorist trough
From the LA Times, 11/4/01:

Another Free Lunch for Fat Cats


Greg Goldin is a Los Angeles journalist

Call it the 9-11 aftershock. The Bush administration, switching to war footing, is treating the deepening economic crisis as a second casualty of the Sept. 11 attack. Bush rushed through a $15-billion bailout to the airlines, promptly proposed ways the government would help shoulder insurers' losses from future terrorist attacks and quickly began promoting a $75-billion pump-priming package.

The administration's unspoken message is that the government has a duty to protect its citizens from the "collateral" fallout of financial hardship and collapse. The trouble is, the bailouts and stimulus are, like Bush's $1.3 trillion tax cut, a handout to big business and the super-rich. That "amazing spirit of sacrifice" the president has repeatedly commended? That's for the pink-slipped hotel maids standing in line for free groceries. They, like hundreds of thousands of other workers recently put out of work, will be sacrificing all right, getting by on unemployment benefits that are at historic lows. Ultimately, they may have to rely on a greatly scaled-back safety net. Meantime, at the White House and on Capitol Hill, where Wall Street calls the shots, the reigning ethos remains the same: Those with the best-paid lobbyists win. Shared sacrifice? Consider the shameful distribution of pain in the airline industry. A bailout of these mismanaged companies was no doubt unavoidable, but even as more than 100,000 aviation workers were being laid off, Congress insisted on exactly nothing in return for a hefty taxpayer subsidy. Overpaid CEO's were simply left free to slash more jobs and run. The legislation, supported by both Republicans and a Democratic Party leadership enraptured by fiscal austerity, contained no funds for laid-off workers stripped of health-care benefits. It allocated no money for job training. Airlines were permitted to disregard the standard severance provisions of their labor contracts. Even expanding unemployment insurance from 26 to 39 weeks—a minimal demand at best—was rejected.

At the same time that the bailout abandons workers, it mollycoddles airline executives. To qualify for the $10 billion in loans available under the bill, airlines must freeze current executive compensation at 2000 levels for two years and limit severance pay to twice that amount. This may sound like some kind of sacrifice. But think of Delta Air Lines Chairman Leo F. Mullin, who got $2.1 million last year in salary and bonuses and as much as $34 million when his stock options are counted. Continental's Gordon Bethune raked in $3 million in salary and bonus, and another $4.8 billion in options. Donald Carty of American Airlines had potential earnings of $15.9 million. James Goodwin, until last week CEO of United Airlines, $10 million. To put this in perspective, it would take 1,365 years for the average American worker, making $25,501 annually, to earn Delta chair Mullin's yearly salary, 623 years to earn Carty's and 392 years to earn Goodwin's. And so it goes. If an airline chooses to skip the loan and go straight for the $5 billion in grants awarded by the bill, the sky's the limit on executive salaries and severance.

The airline bailout legislation was crafted within hours of the first impact at the World Trade Center, as industry lobbyists fanned out through the halls of Congress with a wish list leveraged by the claim that the airlines were victims, too, and should not be left to bear the burden of the attack alone. But the bill they sponsored handed a frayed and tattered parachute to workers, who were also victims, while executives continued to fly on gilded wings.

Contrast this bailout to the $1.5-billion U.S. bailout of Chrysler in 1980. Concessions to the ailing car maker were spread among union employees, executives, suppliers, lenders and dealers. Lee Iacocca went to work for $1 a year. The United Auto Workers were given a seat on the company's board of directors. And the government took stock warrants in trade for the Treasury's cash loan—which, by the way, was paid back in full. What's more, when Iacocca volunteered to take his buck a year, the average CEO made 42 times the average blue-collar worker's pay. According to Business Week, last year that spread was a staggering 531 to 1. A typical hourly worker got a 3% raise last year, a salaried employee 4%. The average CEO pulled in $20 million, including nearly 50% more in stock options and 22% more in salaries and bonuses than in the previous year.

In one respect the Bush administration is turning the clock back to the 1980s. His "economic stimulus" package is pure Reaganomics. The first $24 billion—spread over 10 years—will go to large companies that pay the low-rate "alternative minimum tax" designed to ensure that profitable corporations paid at least some taxes. Under the plan, such taxes would be retroactively returned. General Electric, the giant defense contractor that stands to benefit from a new military build-up, would receive a rebate of $671 million on past taxes. United Airlines would get back $60 million. IBM a whopping $1.4 billion. The list of megacorporations reaping megabucks includes Enron, General Motors, Chevron, Texaco, Phillips Petroleum and Alaska Air Group. Another $109 billion will go to corporations over the next three years through "accelerated depreciation," faster write-offs of equipment costs. So much for some of the nation's most profitable corporations contributing their fare share to Bush's war on terrorism.

And that's just the beginning. The president wants to race ahead with the cutbacks in top personal income tax rates he won earlier this year, fully instituting them next year rather than in 2006. If Congress goes along with the administration plan, the richest 1% of all taxpayers would average a $27,000 reduction in 2002. A middle-class family earning $50,000 a year would get just $68. The 37 million individuals and couples who did not get this year's tax rebate because their tax liability was too low would get a one-time $350 payment.

This is the same old supply-side agenda, wrapped in the flag. Swaddle the rich and powerful in tax breaks while tossing pennies to the rest of us. As for actually restarting the economy, that burden is reserved for millions shivering at the prospect of a deep recession and, perhaps, already on the brink of personal insolvency. Bush urges these hard-working American households, already saddled with an average of $8,500 in credit card debt, to spend more, as if it were a patriotic duty to go deeper into debt.

As conservative commentator Bill O'Reilly said shortly after airline layoffs were announced, "It is time for the corporations to step up and serve America and not themselves. Everybody including the Fortune 500 should make sacrifices. Keep a close eye on who is doing what to whom. Don't let companies get away with treating you unfairly." Unfortunately, they and their richest stockholders already have treated us unfairly, and with the connivance of the White House, they're aiming to do so again.

Copyright 2001 Los Angeles Times

United we stand, but sacrifice is for suckers
Some thoughts on getting big money out of democracy. Posted before 11/6/01:

Whenever you hear a man speak of his love for his country, it is a sign that he expects to be paid for it.

H.L. Mencken

Which America Will We Be Now?
by Bill Moyers

For the past several years I've been taking every possible opportunity to talk about the soul of democracy. "Something is deeply wrong with politics today," I told anyone who would listen. And I wasn't referring to the partisan mudslinging, the negative TV ads, the excessive polling or the empty campaigns. I was talking about something fundamental, something troubling at the core of politics. The soul of democracy—the essence of the word itself—is government of, by and for the people. And the soul of democracy has been dying, drowning in a rising tide of big money contributed by a narrow, unrepresentative elite that has betrayed the faith of citizens in self-government.

But what's happened since the September 11 attacks would seem to put the lie to my fears. Americans have rallied together in a way that I cannot remember since World War II. This catastrophe has reminded us of a basic truth at the heart of our democracy: No matter our wealth or status or faith, we are all equal before the law, in the voting booth and when death rains down from the sky.

We have also been reminded that despite years of scandals and political corruption, despite the stream of stories of personal greed and pirates in Gucci scamming the Treasury, despite the retreat from the public sphere and the turn toward private privilege, despite squalor for the poor and gated communities for the rich, the great mass of Americans have not yet given up on the idea of "We, the People." And they have refused to accept the notion, promoted so diligently by our friends at the Heritage Foundation, that government should be shrunk to a size where, as Grover Norquist has put it, they can drown it in a bathtub.

These ideologues at Heritage and elsewhere, by the way, earlier this year teamed up with deep-pocket bankers—many from Texas, with ties to the Bush White House—to stop America from cracking down on terrorist money havens. How about that for patriotism? Better that terrorists get their dirty money than tax cheaters be prevented from hiding theirs. And these people wrap themselves in the flag and sing "The Star-Spangled Banner" with gusto.

Contrary to right-wing denigration of government, however, today's heroes are public servants. The 20-year-old dot-com instant millionaires and the preening, pugnacious pundits of tabloid television and the crafty celebrity stock-pickers on the cable channels have all been exposed for what they are—barnacles on the hull of the great ship of state. In their stead we have those brave firefighters and policemen and Port Authority workers and emergency rescue personnel—public employees all, most of them drawing a modest middle-class income for extremely dangerous work. They have caught our imaginations not only for their heroic deeds but because we know so many people like them, people we took for granted. For once, our TV screens have been filled with the modest declarations of average Americans coming to each other's aid. I find this good and thrilling and sobering. It could offer a new beginning, a renewal of civic values that could leave our society stronger and more together than ever, working on common goals for the public good.

Already, in the wake of September 11, there's been a heartening change in how Americans view their government. For the first time in more than thirty years a majority of people say they trust the federal government to do the right thing at least "most of the time." It's as if the clock has been rolled back to the early 1960s, before Vietnam and Watergate took such a toll on the gross national psychology. This newfound respect for public service—this faith in public collaboration—is based in part on how people view what the government has done in response to the attacks. To most Americans, government right now doesn't mean a faceless bureaucrat or a politician auctioning access to the highest bidder. It means a courageous rescuer or brave soldier. Instead of our representatives spending their evenings clinking glasses with fat cats, they are out walking among the wounded.

There are, alas, less heartening signs to report. It didn't take long for the wartime opportunists—the mercenaries of Washington, the lobbyists, lawyers and political fundraisers—to crawl out of their offices on K Street determined to grab what they can for their clients. While in New York we are still attending memorial services for firemen and police, while everywhere Americans' cheeks are still stained with tears, while the President calls for patriotism, prayers and piety, the predators of Washington are up to their old tricks in the pursuit of private plunder at public expense. In the wake of this awful tragedy wrought by terrorism, they are cashing in. Would you like to know the memorial they would offer the thousands of people who died in the attacks? Or the legacy they would leave the children who lost a parent in the horror? How do they propose to fight the long and costly war on terrorism America must now undertake? Why, restore the three-martini lunch—that will surely strike fear in the heart of Osama bin Laden. You think I'm kidding, but bringing back the deductible lunch is one of the proposals on the table in Washington right now. And cut capital gains for the wealthy, naturally—that's America's patriotic duty, too. And while we're at it, don't forget to eliminate the corporate alternative minimum tax, enacted fifteen years ago to prevent corporations from taking so many credits and deductions that they owed little if any taxes. But don't just repeal their minimum tax; refund to those corporations all the minimum tax they have ever been assessed.

What else can America do to strike at the terrorists? Why, slip in a special tax break for poor General Electric, and slip inside the EPA while everyone's distracted and torpedo the recent order to clean the Hudson River of PCBs. Don't worry about NBC, CNBC or MSNBC reporting it; they're all in the GE family. It's time for Churchillian courage, we're told. So how would this crowd assure that future generations will look back and say "This was their finest hour"? That's easy. Give those coal producers freedom to pollute. And shovel generous tax breaks to those giant energy companies. And open the Alaska wilderness to drilling—that's something to remember the 11th of September for. And while the red, white and blue waves at half-mast over the land of the free and the home of the brave—why, give the President the power to discard democratic debate and the rule of law concerning controversial trade agreements, and set up secret tribunals to run roughshod over local communities trying to protect their environment and their health. If I sound a little bitter about this, I am; the President rightly appeals every day for sacrifice. But to these mercenaries sacrifice is for suckers. So I am bitter, yes, and sad. Our business and political class owes us better than this. After all, it was they who declared class war twenty years ago, and it was they who won. They're on top. If ever they were going to put patriotism over profits, if ever they were going to practice the magnanimity of winners, this was the moment. To hide now behind the flag while ripping off a country in crisis fatally separates them from the common course of American life.

Some things just don't change. When I read that Dick Armey, the Republican majority leader in the House, said "it wouldn't be commensurate with the American spirit" to provide unemployment and other benefits to laid-off airline workers, I thought that once again the Republican Party has lived down to Harry Truman's description of the GOP as Guardians of Privilege. And as for Truman's Democratic Party—the party of the New Deal and the Fair Deal—well, it breaks my heart to report that the Democratic National Committee has used the terrorist attacks to call for widening the soft-money loophole in our election laws. How about that for a patriotic response to terrorism? Mencken got it right when he said, "Whenever you hear a man speak of his love for his country, it is a sign that he expects to be paid for it."

Let's face it: These realities present citizens with no options but to climb back in the ring. We are in what educators call "a teachable moment." And we'll lose it if we roll over and shut up. What's at stake is democracy. Democracy wasn't canceled on September 11, but democracy won't survive if citizens turn into lemmings. Yes, the President is our Commander in Chief, but we are not the President's minions. While firemen and police were racing into the fires of hell in downtown New York, and now, while our soldiers and airmen and Marines are putting their lives on the line in Afghanistan, the Administration and its Congressional allies are allowing multinational companies to make their most concerted effort in twenty years to roll back clean-air measures, exploit public lands and stuff the pockets of their executives and shareholders with undeserved cash. Against such crass exploitation, unequaled since the Teapot Dome scandal, it is every patriot's duty to join the loyal opposition. Even in war, politics is about who gets what and who doesn't. If the mercenaries and the politicians-for-rent in Washington try to exploit the emergency and America's good faith to grab what they wouldn't get through open debate in peacetime, the disloyalty will not be in our dissent but in our subservience. The greatest sedition would be our silence. Yes, there's a fight going on—against terrorists around the globe, but just as certainly there's a fight going on here at home, to decide the kind of country this will be during and after the war on terrorism.

What should our strategy be? Here are a couple of suggestions, beginning with how we elect our officials. As Congress debates new security measures, military spending, energy policies, economic stimulus packages and various bailout requests, wouldn't it be better if we knew that elected officials had to answer to the people who vote instead of the wealthy individual and corporate donors whose profit or failure may depend on how those new initiatives are carried out?

That's not a utopian notion. Thanks to the efforts of many hardworking pro-democracy activists who have been organizing at the grassroots for the past ten years, we already have four states—Maine, Arizona, Vermont and Massachusetts—where state representatives from governor on down have the option of rejecting all private campaign contributions and qualifying for full public financing of their campaigns. About a third of Maine's legislature and a quarter of Arizona's got elected last year running clean—that is, under their states' pioneering Clean Elections systems, they collected a set number of $5 contributions and then pledged to raise no other money and to abide by strict spending limits.

These unsung heroes of democracy, the first class of elected officials to owe their elections solely to their voters and not to any deep-pocketed backers, report a greater sense of independence from special interests and more freedom to speak their minds. "The business lobbyists left me alone," says State Representative Glenn Cummings, a freshman from Maine who was the first candidate in the country to qualify for Clean Elections funding. "I think they assumed I was unapproachable. It sure made it easier to get through the hallways on the way to a vote!" His colleague in the Statehouse, Senator Ed Youngblood, recalls that running clean changed the whole process of campaigning. "When people would say that it didn't matter how they voted, because legislators would just vote the way the money wants," he tells us, "it was great to be able to say, 'I don't have to vote the way some lobbyist wants just to insure that I'll get funded by him in two years for re-election.'"

It's too soon to say that money no longer talks in either state capital, but it clearly doesn't swagger as much. In Maine, the legislature passed a bill creating a Health Security Board tasked with devising a detailed plan to implement a single-payer healthcare system for the state. The bill wasn't everything its sponsor, Representative Paul Volenik, wanted, but he saw real progress toward a universal healthcare system in its passage. Two years ago, he noted, only fifty-five members of the House of Representatives (out of 151) voted for the bill. This time eighty-seven did, including almost all the Democrats and a few Republicans. The bill moved dramatically further, and a portion of that is because of the Clean Elections system they have there, Volenik said.

But the problem is larger than that of money in politics. Democracy needs a broader housecleaning. Consider, for example, what a different country we would be if we had a Citizens Channel with a mandate to cover real social problems, not shark attacks or Gary Condit's love life, while covering up Rupert Murdoch's manipulations of the FCC and CBS's ploy to filch tax breaks for its post-terrorist losses. Such a channel could have spurred serious attention to the weakness of airport security, for starters, pointing out long ago how the industry, through its contributions, had wrung from government the right to contract that security to the lowest bidder. It might have pushed the issue of offshore-banking havens to page one, or turned up the astonishing deceit of the NAFTA provision that enables secret tribunals to protect the interests of investors while subverting the well-being of workers and the health of communities. Such a channel—committed to news for the sake of democracy—might also have told how corporations and their alumni in the Bush Administration have thwarted the development of clean, home-grown energy that would slow global warming and the degradation of our soil, air and water, while reducing our dependence on oligarchs, dictators and theocrats abroad.

Even now the media elite, with occasional exceptions, remain indifferent to the hypocrisy of Washington's mercenary class as it goes about the dirty work of its paymasters. What a contrast to those citizens who during these weeks of loss and mourning have reminded us that the kingdom of the human heart is large, containing not only hatred but courage. Much has been made of the comparison to December 7, 1941. I find it apt. In response to the sneak attack on Pearl Harbor, Americans waged and won a great war, then came home to make this country more prosperous and just. It is not beyond this generation to live up to that example. To do so, we must define ourselves not by the lives we led until September 11 but by the lives we will lead from now on. If we seize the opportunity to build a stronger country, we too will ultimately prevail in the challenges ahead, at home and abroad. But we cannot win this new struggle by military might alone. We will prevail only if we lead by example, as a democracy committed to the rule of law and the spirit of fairness, whose corporate and political elites recognize that it isn't only firefighters, police and families grieving their missing kin who are called upon to sacrifice.

The pork continues
With Republicans in charge of the White House and Congress, can we expect a smaller government, a slashing of bureaucracies, and an end to dependency-inducing giveaways? You've got to be kidding. That conservative/libertarians want these things is a myth created by their propaganda machines. What they really want is to transfer government benefits from the majority of lower- and middle-class people to the minority of the rich—themselves.

From the LA Times, 12/31/02:

Corporate welfare extends from classic political pork, such as a $1.1-billion loan guarantee to build cruise ships in Sen. Trent Lott's hometown, to financial assistance for large companies from the Overseas Private Investment Corp. and to farm subsidies that ate up $35 billion last year. Time magazine estimated in 1998 that corporate welfare costs taxpayers $125 billion annually, a figure that includes "tax expenditures" granting exemptions to favored industries, such as timber, energy and insurance.

Related links
Corporate culture:  rotten to the core
America's culture wars (economic)
Right-wing extremists:  the enemy within
A shining city on a hill:  what Americans believe
America's cultural mindset

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