US Debt Deal

The Senate should take “Cut, Cap, and Balance" (catchy title… the Democrats could use buzzier titles), which they narrowly defeated, modify it a bit (add defense cuts, restore some cuts to the poorest & neediest, remove the Bush-era tax breaks for incomes >$250k… ok, modify it a lot) and send it to a reconciliation committee. They did much more finagling to pass the health care bill. There is nothing wrong with a balanced budget amendment if it has exceptions for recessions (like now) and prohibits the drunken-sailor-with-a-credit-card spending seen in the previous admin.

This is looking ugly for the country. But if your explicit goal is to deprive the President of anything resembling a success, and thereby ensure his defeat in the next election (and if the economy crumbles, call it collateral damage and drive on), well, then sadly it’s looking pretty good.

Call it the “Cut, Cap, Balance, and Back-Slap” act. (DC works better with a little B-S).

Tax Derivatives to Reduce the Debt & Improve the Economy

The gross domestic product (GDP), the sum of all economic transactions in the US, is roughly $15T, which is roughly comparable the national debt. Sounds big and bad (respectively) but they pale in comparison to the derivatives market, which is over 20-times larger!

Derivatives can be used to reduce risk by betting on a future price. This is valuable in particular situations, such as farmers planting crops, but the total market has grown to a size that causes dramatic volatility in currency and energy (oil) markets, increasing the risk to economic stability. These trades are largely unregulated and entirely untaxed. I propose we tax derivative trading at the trivial rate of 1%. I don't predict that we would raise all $6T annually, because some trades would not be done, some might go further undercover, and some will go 'offshore'. But NY State Pensions won't deal with entities in the Caymen Islands or Geneva as freely as they would Long Term Capital, or Lehman, or Solomon. We will raise significant amounts of 'revenue' (money) and reduce to some degree the silliness and scariness of the market.

Voting Guide

There seems to be some confusion 'out there' about the reason and rational for (a) voting and (b) voting for somebody in particular. This handy pocket guide is intended to help dispel confusion and is suitable for writing on your hand for cribbing inside the sanctity of the voting booth.

1. Vote.

If you don't vote, don't complain. The saying “I don't vote; it only encourages them” is funny but stupid, because it leaves the choice in the hands of the zealots. Don't think you have to read all their position papers to vote intelligently; the public persona is what will guide the policy. Before the 2000 election, George W Bush said he believed in controlling greenhouse gasses but talk is cheap and his whole campaign was laissez faire capitalist, which dominated post-campaign.

2. Vote for the better candidate.

Don't expect a saint because they rarely appear on the ballot. If you are a ecologically minded, you may be disappointed if the incumbent hasn't made, or the candidate doesn't promise to make, the US more sustainable. But if the opponent denies climate change, scoffs at greenhouse gasses, and doesn't value increased efficiency over “drilling and burning”, then you should vote for your guy despite the disappointment.

Think of a long journey. It is better to head in the correct general direction and fine-tune later that not start at all, or head in the wrong direction.

Woe is US

We really didn't know what “W” stood for early in his reign... “Winner” we hoped (against all evidence). “Wastrel” seemed more probable but was too obscure. “Wrong” fit when he pushed for a war in Iraq based on WMD. Finally, at the end, we knew: “Worst”. Ignoring Richard Clarke's warning about 9/11, ineptly prosecuting two wars, never finding Osama Bin Laden (OBL). A budget surplus turned into a historic deficit. Enron early, Madoff late, a destructive housing bubble supported by a massive derivative market testifying to the lax or absent oversight. Chalk that up to what W didn't learn in Harvard Business School.

Fear + Loathing = Grist

You may wonder why I nearly quit posting on this blog. I've wondered myself. I feel bad about being inconstant and inconsiderate to you, my esteemed reader, and I owe you an explanation. The explanation came to me just the other day.

The Bush years were as if I was in the back seat of a car driven by a crazy frat boy, careening over the street, and my attention was (understandably) riveted on what new potential disasters were appearing just ahead and what fresh disasters we were leaving behind. I was communicating with my fellow passengers as quickly as I could form coherent thoughts in the hope (naturally) that somebody could somehow restrain the driver. I did more than blog: also wrote letters to my Congressional representatives and local newspapers, and even demonstrated on the mall in DC against starting the Iraq war.

Now we are recovering from our long national nightmare, nursing our hurt from crashing a couple parties where we overstayed our (un)welcome, and wondering how we are going to pay for that nice car that is now upside down in the ditch. The adults have now arrived and taken over, thankfully, and we can go back to assuming the trip back home will be slow and uneventful. Have we gotten back home to prosperity and respect, yet? How much longer? I'm tired.

War Elephant

Gibbon notes in his “Decline and Fall of the Roman Empire” that stable empires commit about 1% of their resources to the army; more being wasteful and less, dangerous. By Gibbon’s metric, the US “Defense” department should receive about $140 B (US GDP ~$14T), roughly one-fifth of its current budget. Sure, it’s arbitrary, but it also makes sense relative to the other countries.

Thank you Al Jazeera

Revolutions in the Arab world were preceded by a revolution in Arab news reporting – performed by a relatively new organization: Al Jazeera. It has been vilified in the knee-jerk American press because it does not reflexively admire all of the actions of America. Al Jazeera only embodies the central American tenet: an independent press is the best protection against tyranny.

Instead of tweeting or posting some insipid observation on Facebook or listening to idiotic right wing 'talk radio', try listening to 'think radio' here: http://english.aljazeera.net/watch_now/

Ah, the internet, what a revolutionary thing.