Poor Little Rich Boys and the Big Bad Meltdown

I love Robert Reich; he's so great. This is from his blog, where he's talking about what economists call 'moral hazard' - the likelihood that you'll take more risks if you know somebody will jump in and save your butt later. But as he points out, while bailing out the little guy is often the cause of much harrumphing in Washington, bailing out the big guy is pretty much standard operating procedure.

(The shamelessness of the corporate elite has reached satirical heights when even financial writers themselves are making fun of Wall Street stock brokers and hedge fund managers. When you're done with Reich, read this piece, from Bloomberg News.)

Here's Reich:

When it comes to risky behavior in the market, America has a double standard. We’re told that economic risk-taking is the key to entrepreneurial success, but when big entrepreneurs take big risks that fail it’s amazing how often they get bailed out. Indeed, the history of modern American business is littered with federal bailouts, loan guarantees, and no-questions-asked reorganizations. Some are well known, such as the Chrylser bailout of 1979, the savings and loan bailout of 1989, and the airline bailout of 2001. Most occur in the relative dark, such as the 1998 bailout of giant hedge fund Long-Term Capital Management (courtesy of former Fed chair Alan Greenspan), the not infrequent bailouts of under-funded corporate pension plans by the government’s Pension Benefit Guarantee Corporation, price supports for big agribusinesses facing market downturns, or the current bailout of Wall Street being engineered by Ben Bernanke’s Fed. Behind every one of these bailouts are CEOs or financial executives who were rescued from their bad bets.

CEOs get away with stupid mistakes all the time. Some, like Robert Nardelli, the former CEO of Home Depot, drive their company’s stock so low that their boards eventually oust them. But they leave with eye-popping going-away presents nonetheless. (Nardelli got several hundred million dollars on his departure.) If you’re an average American who gets canned from his job, even through no fault of your own, you probably won’t even get unemployment insurance (only 40 percent of job-losers qualify these days).

Conservatives tell us that unemployment insurance reduces their incentive to find a new job quickly. In other words, moral hazard. Some CEOs use bankruptcy as a means of getting out from under pesky labor contracts they might have "known they could not afford" when they agreed to them (Northwest Airlines most recently, for example). Others use it as a cushion against bad bets. Donald ("you’re fired!") Trump’s casino empire has gone into bankruptcy twice -- most recently, last November, when it listed $1.3 billion of liabilities and $1.5 million of assets -- with no apparent diminution of the Donald’s passion for risky, if not foolish, endeavor. After all, his personal fortune is protected behind a wall of limited liability, and he collects a nice salary from his casinos regardless. But if you’re an ordinary person who has fallen on hard times, just try declaring bankruptcy to wipe the slate clean.

A new law governing personal bankruptcy makes that route harder than ever. Its sponsors argued -- you guessed it -- moral hazard. Bush’s "ownership society" has proven a cruel farce for poor people who tried to become home owners, and his minuscule response to their plight just another example of how conservatives use moral hazard to push their social-Darwinist morality. The little guys get tough love. The big guys get forgiveness.

Gagging the Gag Rule

I love this country, truly I do, but when it goes off the rails, it goes way off. Not only do we Americans love religious theater, but we love to play it out on other people's stages, often at the cost of thousands of lives. Some of us will track down evil wherever it lives, apparently, so extreme is our commitment to morality. Sometimes in the course of our moral crusading we actually create larger evils than we stamp out, and that's a discomfiting result, but we don't let it stop us. We can't, because after all, we're standing on principle.

And because this is the American way, it's a happy surprise to note that the global gag rule, the most shameful, shortsighted, and sexually imperialistic bit of foreign policy mischief to ever come out of Washington, is finally under attack by Congress. (I have to note that the good guys in this case aren't guys at all; they're women, in the forms of Barbara Boxer and Olympia Snowe. Not a surprise.)

In the Senate yesterday:

The U.S. Senate yesterday voted to repeal the "global gag rule," reinstated by President George W. Bush in 2000 on his second day in office, which bans aid to international family planning organizations that provide or counsel on abortion.

By a vote of 53-43, senators struck down the rule, also called the "Mexico City Policy," which was first announced by former President Ronald Reagan in 1984 at a U.N. conference on population in Mexico City. It limited U.S. financial assistance to foreign family planning groups that do not promote or disseminate information about abortion. Former President Bill Clinton rescinded the policy in 1993, but Bush reinstated it.

Yesterday's vote rejected a motion to kill an amendment by Senator Barbara Boxer, attached to a $27 billion State Department foreign aid bill, to repeal the global gag rule. Boxer said the rule would be unconstitutional if applied to family planning organizations in the United States. "How can we export a policy that denies free speech and still say we support democracy?" she asked.

The bill includes a provision restoring $50 million in funding to the U.N. Population Fund over a two-year period. Last July, the Bush administration withheld $34 million in funding for UNFPA, which had already been approved by Congress. The White House alleged that UNFPA indirectly supports forced abortion in China, a charge that was denied by UNFPA repeatedly as well as by numerous experts.

It faces a possible presidential veto, however. The White House Office of Management and Budget said before the vote that the administration would "strongly oppose" any amendment that would allow the government to fund abortion advocacy. "The president would veto the bill if it were presented to him with such a provision," the OMB said in a statement.

The Reproductive Rights Alliance of South Africa, where Bush visited yesterday and today, said the global gag rule has led to 1.5 million unwanted births, 15,000 maternal deaths, 92,000 infant deaths and 2.2 million unsafe abortions.

And in the House:

The House passed the foreign aid appropriations bill (HR 2764) in June with provisions exempting contraceptives from the global gag rule and repealing the abstinence-only funding restrictions for HIV prevention programs. According to Population Action International, this marks the first time since the Global Gag Rule has been in effect, from 1984-1993 and again since 2001, that both the House and the Senate have passed legislation to repeal or modify its restrictions.

I've followed the scandalous gag rule since it was signed into law under Reagan, but writing about it now, I'm wondering why, obvious reasons aside, it still incites so much passion in me. Why I'm still so angry about it. And I think it's this: it's one of the most pernicious side effects of our showy religious culture, and one more reason that "faith-based" policies with all their paternalistic moral undertones are so ultimately destructive, both to actual lives and to the body politic. The mullahs in Washington simply have no right to make life-and-death decisions for poor women and poor children they'll never meet and to whom they will never be accountable. They have no right to ignore the facts, meaning the quanitifiable effects of policies on real lives, in favor of a smug religious ideology not shared by those their decisions affect. They have no right, that is, in a country such as this one, which supposedly cherishes reason. Do they?

20,000 Prayers, No Answer Required

Excerpt from an email sent by Sojourners, the progressive evangelical group:

As people of faith, we believe in the power of prayer to soften the hardest of hearts and open the way to peace and reconciliation. So, as General Petraeus testifies, we're planning to match his surge with one of our own – 20,000 prayers for Congress to bring an end to this war.

I'm a big fan of Sojourners and its SojoMail e-bulletins and related blog. I like knowing what liberal religious people are thinking and talking about; I especially like knowing that there are liberal religious people out there pushing back against the pernicious idea, promulgated by our current president, that religion is the property of conservatives. The Sojourners crew is smart and earnest and on the right side of every issue I can think of.

But this email bothers me, because it seems to me that when any grassroots group begins asking people to pray for change in national policy, the group's all but admitted its utter inability to do anything but pray. And when a religious group sets up a fusillade of prayer directed at recalcitrant politicians, it only suggests how irrelevant it is to the political process.

I know the folks at Sojourners would take umbrage; they'd say prayer is an essential expression of spiritual integrity and power, and that it's capable of almost anything. But is it? Personally, there's no doubt that prayer can be transformative. But not politically. Surely flipping through the pages of any history book should be enough to convince anyone of that fundamental truth. Is there even the slightest evidence that prayer has ever been effective in changing the course of historical, or even natural, events, if by changing we mean improving? No. Yet religious people persist in claiming that prayers make a difference. If (and I'm assuming there must surely be condition or two) they're sincere enough, or plentiful enough, or something enough.

It's easy to be disdainful of certain religious practices, but that's not what I'm doing here. Taking cheap shots at Christians doesn't interest me, and especially not Sojourners, which is providing much-needed public pushback to the wizened, mean-spirited brand of Christianity that has found so much public expression in the last decade.

But yet, I'm confused about the implications of this "prayer surge." If, after 20,000 prayers, Congress doesn't bring an end to the Iraq war, what shall we conclude? That God supports the war? That God wasn't listening to the prayers? Or rather, that he was listening, but decided that letting the war run its course would for some reason be better than ending it?

In a way it doesn't matter, because prayer of this type is a win-win for God. He gets credit no matter what he does, something or nothing, because he's all-knowing and always makes the best decision for us. Nor can he be held accountable for any bad outcome, because, after all, we created our own mess and are to blame for any suffering that results from it. All the credit, none of the blame, no real responsibility. This is God as Christians understand him?

Which is exactly why I thought many Christians had more or less given up intercessory prayer. It makes us all look a little bit foolish. God, too, when you think about it.

Is Capitalism Killing American Democracy? And Can National Service Save It?

Robert Reich, in his new book, wonders whether "supercapitalism" - the ever-growing wealth and influence of big monied interests - is undermining democracy in the U.S. Thirty years ago, he says, most Americans, when asked, said democracy was working pretty well. Now they say the opposite. According to Reich, average Americans feel that they have almost no ability to influence their government; they perceive instead that corporate interests and their Capitol Hill lobbyists really pull all the strings.

But we are ourselves to blame. We've been content to passively support policies of all sorts that keep prices low, as though low prices were a policy end in themselves, always and ultimately good. Are we consumers, he asks, or are we citizens? Which is the more important to us? Because we need to make a choice.

His question is an appealing one. The problem, which even he acknowedges, is that people might like the abstract idea of "citizenship" but don't really know how to pursue it. (Shopping, on the other hand, is fairy concrete.)

Richard Stengel from Time CNN writes about much the same problem, noting that "today the two central acts of democratic citizenship are voting and paying taxes. That's basically it." To his mind, one solution would be a national service program. "It is the simple but compelling idea that devoting a year or more to national service, whether military or civilian, should become a countrywide rite of passage, the common expectation and widespread experience of virtually every young American."

Such service would not be "mandatory or compulsory," he writes, but nevertheless should be "universal." How he would accomplish that trick is anybody's guess, since things that aren't mandatory can rarely be made universal.

Actually, this topic has been on my mind a bit. Last year at Thanksgiving, my son brought two friends home from school, one Korean and the other German. As they helped themselves to turkey and cranberry dressing, we talked a little about their lives back home. It came out that, when their schooling in the States ends and they go home, both will serve mandatory stints of national service. Both expect to be assigned to military units, though apparently other options exist for the physically disabled.

Why don't we have such a requirement, in this land of so much flag-waving, yellow-ribbon-tying, bumper-sticker-flaunting patriotism? My guess is that a national service requirement would strike American parents as unpleasantly socialistic. It would also strike them as economically disadvantaging, since their young strivers would have to slow down for a year to work not for their own betterment, but for the nation's. But it's an interesting idea nonetheless, both for the real benefits it would create for the participants and for the questions it would force us all to ask: Do we really have a national community? And if so, do we owe it anything?

Those Jews Are So Smart

Now here's an interesting piece. It's by Charles Murray of Bell Curve fame, who posits that 1) Jews are on average more intelligent than other groups, 2) that their superior intelligence is due to hereditary factors and not cultural or environmental ones, and 3) that there are long and involved reasons going back to the destruction of the Second Temple in Jerusalem for why this should be so.

I for one am perfectly happy to believe that Jews are pretty darn intelligent. They are, as Murray points out, very much overrepresented among the business, academic and cultural elite of our society, and no doubt for excellent reason. And I believe that Murray has made an honest attempt at figuring out why they're so smart (though reasons seem to be cultural in themselves, having to do with the ancient turn away from ritualistic religious expression and toward scholasticism, when Jews who weren't literate enough to read and interpret the Torah just kind of stopped being Jews, to save themselves the humiliation).

But this is beside the point. Murray was pilloried after The Bell Curve for the racism people thought was inherent in his argument that blacks as a group are less intelligent than whites (and that Asians are more intelligent than either).

Accusations flew from all sides, most especially about the appropriateness of relying on IQ scores as a credible measure of intelligence, when we all know very well that throughout American history different classes and races have had very different educational and cultural experiences.

This is what I'm thinking: It's fine and good to signal out a particular group, such as Jews or Asians, for being unusual in some way or other. How did they get to be so unusual, we might want to know. An interesting question. Maybe even a useful one.

But when the issue is intelligence, which Murray claims is practically immutable, the question inevitably becomes: who is this group more intelligent than? And how does this inferior group feel upon hearing the news of their inferiority? Is it likely to be helpful somehow, or just hurtful? Could there be something socially constructive about making such an observation, and then backing it up with reams of statistics that lend it the patina of unchallengeable Science?

All news, of course, doesn't have to be good news, and not everyone should be protected from the truth, if the truth can be ascertained. But science, like medicine, should do no harm. And invidious comparisons between racial groups can't do otherwise, can it? Not in our society, where blacks and Hispanics still constitute an underclass and whites are up in arms about the brown people flowing in over the borders. I would think Murray would be smart enough, if you'll excuse the word, to know that.

Trying to Figure Out the Mormon Story

I happen to live down the road from a Mormon chapel, which may be why, perusing the used books at a neighbor's yard sale over the weekend, I came across a copy of The Book of Mormon. I'm a big fan of book sales of any kind, the more eclectic and shabby the better, but I've never encountered this particular book anywhere. My curiosity was piqued. Aside from seeing a few episodes of Big Love, I don't know much about Mormonism. So, for 25 cents, I snapped it up.

The introduction of The Book of Mormon calls it "comparable to the Bible," and explains that its centerpiece is a description of Christ's ministry right here in North America, which he supposedly undertook sometime after his more famous ministry in the Holy Land. His followers, whom I suppose we'd call the ancient Americans, were actually transplants from Jerusalem, ordered by God to board a ship and make the perilous voyage over some 600 years before Jesus' birth. But even before they landed the immigrants began splitting into two groups, one godly and the other evil. Over the innumerable generations that followed, the two sides fought bitterly. The godly were killed but some of the evil ones survived. The descendants of those evil ones are today's American Indians.

Well. I've read 30 pages or so, and plan on giving the story a respectful hearing. It deserves as much, and far be it from me to suggest that the Mormon story is any more or less preposterous than the stories that other religions tell. But this is what I find intriguing: unlike other major religions, this one was born in modern times - the gold plates upon which these surprising facts were inscribed were said to be discovered in the 1820s in New York State, and the finder, Joseph Smith, is hardly the mystery that Jesus is. Indeed, he left quite a paper trail behind him, not all of it entirely flattering to a prophet. Which makes me wonder where today's Mormons, Mitt Romney among them, stands on some of the less savory or even way-out bizarre aspects of Mormon history. (For instance, are we to take seriously Smith's revelation that Jackson County, Missouri, is the once and future Garden of Eden? If so, I'd imagine the county's planners are going to want to factor that into their growth projections. And I hate to even think of the theme park possibilities.)

For now, I'm seeing at least one lesson here: for easy believing, perhaps it's best to stick with religious figures shrouded in the mists of time. They don't leave behind records of law suits, or newspaper stories that document them scrambling out of windows to escape the wrath of angry mobs.

Oh, one more thing. I'll bet Romney doesn't win the Native American vote. I'm just saying.

One Man's Trash Is Another Man's ... AMC Gremlin

I'm proud to announce that I've won a very special sort of prize. Only a very small percent of the population could be as lucky! What is it????

Well ... hold on to your hats. I've been the owner of three - yes, three - of the ugliest cars in history. The thrill! I mean, I knew they were ugly. Yes, I did! Only, I didn't know others would come to consider their ugliness a sort of a ... status symbol, or something. To be ugly enough to become a cultural icon - well, that's something special.

According to Yahoo Finance, Hagerty Insurance, the largest provider of insurance to classic-car collectors, recently polled its policyholders, asking them to name the 10 ugliest cars of all time. Cars so ugly, they may actually be worth collecting. Here's what they said:


1. The AMC Pacer. "Zero to sixty in four-and-a-half hours. AMC's only conceivable excuse for this stylistic horror would be if their design crew was tripping on massive quantities of acid, and even then it wouldn't be a good excuse." I resent this. The Pacer was my third car, and it was EXCELLENT for stuffing to the gills when I went to college. I loved my Pacer. It was a pretty blue, and I washed it every weekend, and it only broke down occasionally. I ended up selling it to buy a ticket to Australia, to chase an ex-boyfriend. So, hey, it was kind of worth it.

2. Chevolet Chevette. Voter's comment: "It was so underpowered, you had to shift down with the AC on to climb the slightest hill. Everything was too small inside, and the dash looked like a 12-year-old designed it. Owned it a year and laughed when I sold it!"

3. Ford Edsel. Voter's comment: "Gas-guzzling, three-ton behemoth with a toilet seat grill and inexplicably tacky push-button transmission shifting. The standard by which all other automotive brand failures have been judged (and ridiculed) for 50 years."

4. AMC Matador. Voter's comment: "The Matador coupe had those bug-ugly front lights and the strange rear-end design treatment. It's hard to imagine a car that large having so little interior space. A total waste of steel (and glass, and plastic, and rubber...)."

5. Chevrolet Corvair. This is the car that gave Ralph Nadar a cause! Voter's comment: "They were all death traps. If you got rear-ended, they burst into flames. If you got into a sideways slide, the tires blew off the rims and they rolled over."

6. AMC Gremin. Voter's comment: "The most hideously ill-proportioned car of all time." But the Gremlin was okay. Another $200 gift from the parents. This is the car that had to last for years, through the end of college and into my first job in another part of the country. Bright yellow. Yeah, baby.

7. Chevrolet Vega. Voter's comment: "A car that began to rust on the showroom floor brought a whole new meaning to the term 'Planned Obsolescence.'" Now you're talking. This was my very first car, bought for me by my parents for a big $200. It was a shiny red hatchback. It did burn a little oil, I have to admit, and then, eventually, the engine melted. But, up until then, it was all good.

8. Pontiac Aztec. Voter's comment: "The only car that can make a Pacer wagon look good."

9. Ford Pinto. Voter's comment: "Underpowered, cheap plastic, bodies prone to rust...oh, yeah, they blow up, too."

10. Yugo. Voter's comment: "You couldn't get scrap-metal money even if it was running."