For What We're Worth

Gawd! Another election takes place in just a few days. I am so burnt from politics today I feel like like a dude wrapped in gauze, tied to a bed and fed endless liquids of hell juice while forced to view locally produced political advertisements without end. I'm not sure if you remember Stanley Kubrick's adaptation of the Anthony Burgess novel, A Clockwork Orange, but the vision of Alex undergoing his therapy treatments comes to mind regarding the media and our perpetual elections these days.

It would be one thing if elections actually allowed the ruling party to rule in this country, and to make needed changes quickly. If the voted on changes do not work then vote the shysters out of office and put in new ones with different ideas for solutions. But we the people must allow some time to put actual changes in place, and to give those changes an opportunity to fail on their merits. However, in the world in which we live this is not the case today in America the Stilted. 

After four years of Congressional majority, and two years with huge majorities in both houses of the legislature along with the White House, Democrats could only muster a tepid bill of fringe minutiae to address huge wrongs in the finance and credit card sector, a total cave-in to insurance companies over the idea of health care reform and a government backed stimulus package just small enough to stave off the Great Depression while making sure very few of the millions of people who lost good paying jobs under Republican sway will ever see even decent paying employment again. With the hammerlock of the super majority, 60% votes necessary to pass any bill in the U.S. Senate, and a two-thirds majority needed to pass any budget or spending bill in here in my dysfunctional State of California, nothing of positive consequence ever comes to embattled American working families. 

So the loose-screw confederation of amnesiacs, better known as the electorate, will now return control of Congress over to the Republican Party, which sawed the middle class off at the knees this decade with their financial brilliance of perpetual tax cuts for the rich wrapped in distorted terminology of freedom, equality and justice for the individual. The top five percent in this country do great job of convincing the 95% they are one lottery scratch, or one social network solution away from being just like them- wealthy beyond belief and devoted only to their social networked companions.

You might think all those foreclosed upon, unemployed, underemployed, overworked/understaffed,  benefit-less work contractors and outsourced dead industry casualties would begin to get a clue as to who really holds the power in this country. The government did not layoff millions of workers this decade. The government did not cause the collapse of credit, or sell bogus mortgages as gold sealed certificates. That would be the private sector, a sector now swimming in cash and advertising loudly against any fool in government who might want to regulate illegal and unsafe practices, or tax at a socially responsible level the huge hoarded earnings that have wiped away a once vibrant middle class in this country.

It was only September 2008 when the end of the stock market was staring the public in the face as trillions of dollars in value got wiped away as Lehman Brothers and other financial heavyweights on Wall Street teetered on the brink, or collapsed outright. The Dow Jones Industrial average, just six months removed from the huge September stock plummet, and at the outset of the Obama Presidency in March of 2009, stood at 6,500. Today the market is over 11,000. No big job creation has happened from the private sector over that period, but the money guys are printing their dollars or yuan just fine.

In California, the unemployment figures now seem forever fixed at above 12%, and the rhetoric from the conservatives of Republican and Libertarian pinstripes proclaim that more tax cuts are needed to make sure the tepid national economic recovery does not stall with tax rates that will stifle all job creation. This group sat on three-quarters of a trillion dollars in 2008, and now has $943 billion as a stockpile.  Every analyst in the world knows that money will never go into creating much in the way of jobs, because as Moody's points out, "we believe companies are looking for greater certainty about the economy and signs of a permanent increase in sales before they let go of their cash hoards, which they suffered so much to build." Now that is some statement, even in this jaded new Gilded Age.

This brings me to the 2010 election pitting the multitudes of dissatisfied against the contented percentage who have at least $250,000 of investable assets. This group feels very confident about next year, and thought this year was a good one. The group with big money backs Meg Whitman while Jerry Brown, almost by default, stands as the lone iconoclastic figure progressives in California can rally around. Meg Whitman, Wall Street savvy and too rich to even bother voting for much of her life, now resides as the champion of wealthy hubris after spending more than $140 million of her billion dollar fortune on her own gubernatorial campaign. After all has been said and done she has not made a very good candidate for this government job.

I won't bother to get into all the personal attacks levied by and against both candidates, because I have no interest in resurrecting and dissecting the tonnage of toxic mud this campaign spawned. I won't even crack wise and compare the verbiage humorously to terrible recent disasters where toxic mud spewed out of control and wrecked  havoc on so much of the planet's landscape. I will say that in the campaign debate Tom Brokaw moderated in San Rafael there was one very telling question and response that I believe sums it all up. Tom Brokaw asked (in response to Whitman's large personal expenditure on the campaign and her dubious voting record) how she has used some of her fortune to benefit California and all Californians that many of the citizens might not be aware of. You can see and hear the question regarding spending, and  the answer on this Huffington Post clip here.

If you don't trust links, the lady candidate launched into a short voting apology and lengthy attack on public employment unions. She almost casually remembers in the middle of her attack on unions that, "Of course, Griff and I  have a family foundation that supports higher education and health care." She then goes right back on the attack. Listen to Jerry Brown's response and the obvious pride in his family foundation with the million dollars he gave to establish two charter schools, and decide for yourself who puts people first.   

I do not understand why anyone would vote for Meg Whitman, or for Carly Fiorina for that matter. These are two spoiled rich people who have only cuts in government to promote, and no idea on how to pry away investor money into creating jobs for people. Their only mantra is for further tax cuts and more subsidies for the privileged few. I am so saddened these days by the private sector's performance on jobs in so many industrial sectors it has made me sick at heart, and in a state of virtual despair over the future of this country.

High speed rail comes to mind as an example. This is a major effort to create a much needed public benefit, and meets with opposition from private investment that smacks of outright hostility. A very recent paper was published assessing the risks for the public regarding high speed rail. The report says the state cannot afford it, and that the private sector will not build it, or operate it, unless guarantees (subsidies to the private interests) are given to private operators. Of course, Europe and Japan have had high speed rail for years now, and China is busy building high speed rails at a fast clip, but it is just too expensive to put in place here in California, or in other parts of the nation (even though the teetering Obama Administration is fully behind the project).

Pollution is terrible in most parts of California from Redding to Bakersfield in the Central Valley, and throughout all Southern California not situated right at the beach. Putting modern and efficient public transportation throughout these areas seems like a big step in the right direction, but not according to the naysayers. Palo Alto's City Council recently voted down an opportunity to have a station in their city for High Speed Rail, because as their private investor class told them it would create too much traffic. Never mind getting all those cars off the 101 and 280 highways, putting too big a terminal into Palo Alto would be too much to bear for the millionaires of that little part of our world.

Not everyone is opposed to High Speed rail. With tens of thousands of good paying jobs as the big carrot 52% of Californians voted to approve almost $10 billion in bonds to get the project started. The federal government, finally pushing to improve our national infrastructure, earlier this year awarded $2.25 billion of stimulus money to make the start of this project happen within three years time.  Just this week an additional $902 million was given to California for High Speed Rail, and still the private sector drags its feet and hoards the gold.

I am not sure about the outcome of the high speed rail system throughout the country, or even in this state. I am not sure how much of the original concept will come to fruition. I am sure the private sector will have to be bullied by the people to become a major stakeholder, but I am not sure most Americans feel they have the strength to stand against the powerful who hold all the money.

Today the disparity between those who have everything and those who have nothing almost seems insurmountable. There are two very sobering articles recently looking at the growing gap between the classes of the masses. The first is an abstract, Building A Better America- One Wealth Quintile at a Time, by Michael I. Norton and Dan Ariely which explores how typical Americans view the current distribution of wealth in the United States, and what they would like to see as an ideal. The stunning summation from the abstract is how wrong the typical American from all five economic wealth classes views how wealth is distributed today in this country, and that the consensus of this survey finds Sweden as the ideal. Who'd of thunk?

Dear reader you owe yourself a look at this abstract to see that 84% of all the wealth in this nation rests with one-fifth of its population and that 60% of Americans hold less than 4.5% of the economic pie. This is not what most Americans believe to be the case today. I guess most people in this country feel their recent ball card acquisitions, or those plastic super-gulp cups in their cupboards, will really appreciate in a few years time.  

Another detailed article on this economic condition from Reuters, written by Emily Kaiser, is found here. Several economists and the intrepid reporter find that from 2002 through 2007 the top 1% of earners saw annual economic growth of more than 10% during this period while the other 99% captured a 1.3% gain over the same time frame. Economists now have begun to question whether too great a gap in wealth creates the type of seismic economic upheavals that we have witnessed both in the Great Depression and our ongoing Great Recession where the gaps between the top and the bottom was very similar.

This recent Reuters article cites a Deutsche Bank strategist, Ajay Kapur, who saw the parallels between today and the Roaring 20s but did not see the meltdown coming. Kapur did note that the U.S. of 2005 and some other nations were developing into  "plutonomies" where the very few and powerfully rich drove the economy and did most of the consuming. Kapur is the former Citigroup analyst who essentially divided the world into two positions-the rich and the rest- for investment purposes. At least he understands the way things are.

Apologies for not writing sooner. I have just enough faith left in me to vote this upcoming Tuesday with hopes for better tomorrows as a result, or at least a firmer recognition of where we all stand. Hope you vote, and see you soon.