Summer Sizzle (or alternatively, As The Windbag Huffs)

Most Esteemed Madame,

Nope, not roasting. I actually enjoy the heat of summer. I’m weird like that. My mother could tell you stories about her odd son who would shut off the vent to the A/C in his room so he could have the screen window open! This tolerance of heat only got more pronounced after an extended stay in a really hot locale I was in for 6 months.

Testifying? Seemed more like contributions to the heat entropy of the universe, and with about the same effects so far. Time will tell better, but it seems only a little more elevated than the meaningless “tribulations” of BP’s chairman when he also supposedly was “called to account.” People are constantly diverted, constantly, distracted, and constantly put upon by a stressful life. Remaining on focus is difficult, and that may be planned. The one factor in this one that may yield fruit is that some of it happened to people with money and influence. But even if it doesn’t, if journalistic ethics are being given a boost by our British cousins, I’m all for it!

I agree with Bryant Gumbel. Blind praise is worthless in the absence of fair criticism. The pendulum has indeed swung too far the other way for this and a number of other instances, and it sews (among other things) confusion and enfeeblement that are unnecessary. In this, as in much else, we are quite out of balance.

The nation is ready for sacrifice, but not uneven sacrifice. People sense intuitively that things can’t go on as they have been. The hard decisions don’t get made because there is selfishness, greed, ignorance, and fear. The middle class and below, if they bother to look with clear vision, can see an upper class, the main (by far) beneficiaries of the policies of the last 10—really 30—years, a class not only unwilling to sacrifice for the good of the country, for the very future of it, but wanting instead more sacrifice from the at best stagnant (and often declining) fortunes of the middle class. Rolling back generous tax breaks (which have done little to bring the prosperity that was heralded by their passage—indeed, may have done the opposite) can barely be called “sacrifice,” yet it is resisted with the selfish mania of a cult. It does not matter to these cultists—both as individuals and their Lovecraftian corporations—that they are the ones who have benefitted the most from the system of this country, and have the means to provide for its sustenance. Like the wealthy of Empiric Rome, they are disconnected from the citizens they only grudgingly recognize as so titled, and these wealthy are so incredibly unconcerned with the public good, and so self-absorbed, that our Framers—many of them wealthy men themselves—would have considered them treasonous. The exceptions like Buffet and others only serve to demonstrate the rule.

In a sense, it’s true that this debt crisis is partially manufactured at this particular moment (the debt ceiling was raised 13 times in the presidency of George W. Bush, for example). And it’s also true that the our national debt as a percentage (about 90%) of GDP does not come close to that approaching Japan (about 230%), and Japan is not in crisis. But comparisons of that nature can go too far. And neither of those debts are healthy.

It’s also important to remember that many “entitlements” (Social Security and Medicare in particular) are largely (although nowhere completely) funded by specific revenue streams, often from the present and future beneficiaries. The differences between funding and projected outgo are troubling, but would not be even close to being insurmountable if the other things that play a part had not been already enfeebled. The Trust Funds, for starters, should never have been raided and replaced with semi-meaningless IOUs, but instead should have been actually invested. But as a media controlled directly or indirectly by the wealthy increasingly lace the lexicon with terms to shade the perception and discussion, we get the surreal scene of the downsized and outsized formerly middle class being portrayed as “freeloaders” by the very class that not only drove them there, but that owns most everything, pays very little proportionally, and enjoys the lion’s share of the benefits of a society, infrastructure, and social fabric that that upper class contribute very little to.

The US budget problems are structural for several reasons, including the fact that we run large trade deficits that no nation can sustain indefinitely (indeed, is in the process of making us a second-rate power—we seemed to have learned nothing of the economy/spending inversion of the Soviet Union, let alone the examples of other historical trash heaps). But two other reasons stand out in their immediacy: 1) the wealthy—both individuals and corporations—have effectively and continually underfunded the government for a very long time. They know that a weak government prevents the people from using their creature (government!) to enforce their will on them. Yet at the same time, they have diverted the money that government DOES spend to contractors (17% of all federal dollars last year went to contractors), to subsidies (often disguised as something else), to bare survival enthralling entitlements, to mindless exorbitant “Defense” (rather than strategically minded and purposeful Defense), and then moved to starve much in the government machinery that could actually bring the upper class in line. Whatever escaped this process was essentially largely co-opted. The effects of this fiscally have been to create a reinforcing process. More money is owed, more must be borrowed, the usual remedies don’t work; the cycle is repeated but things only get worse, etc. Much of this has been quite deliberate.

Number 2 in immediacy is (and it’s related to number 1, partially as effect) is that drastically underfunded liabilities, combined with largely economically unproductive or counterproductive spending (and government spending in general, while much of it may be necessary, is rarely economically productive and certainly never completely), have made the present course of spending unsustainable, even if a large infusion of new tax revenue is secured. We pay now a price for our past and present willing ignorance, our blindness, our denial. Too long have many things gone unfunded or underfunded, and excessive promises have indeed been made that can’t be kept. And although some of this has been normal (short-sighted) American politics, much of it has been deliberate.

As I’ve said in different ways, you can’t burden the producers to support the able unwilling non-producers. People like to conjure up images of the deadbeat and shiftless sponging off the hardworking folks of the country. But those cases, once the onion layers have been peeled back to reveal the real story, don’t add up to much in the way of real money. And it all drips with irony. Because many of the upper class are not wealthy because they are economically productive, they are wealthy from exploiting a system they helped design and modify so that they could exploit it (does a hedge fund manager, one of whom makes $4 billion a year for example, actually produce ANY economic,--let alone social—good while being rewarded by the system so fantastically the rest of us cannot even imagine it?). And not only do many of these wealthy not produce any social good either, but even worse is that their net effect is to actually leech social capital. We should be VERY wary of any talk of them being labeled economic or social producers.

What we need to do is help entrepreneurs who actually do social and economic good while doing well. We don’t necessarily need to help them directly, we just need to remove the roadblocks and favoritism set in place by and for the controlling members of the parasitic upper class. People know intuitively that it is the middle class, working and having a good, albeit perhaps basic, quality of life, that has been the backbone of the country. And those in the middle class should have real opportunity, if they desire to take it, to improve their station and become wealthy by hard work, good ideas, good sense, and a bit of luck. Yes, some insightful and fortunate technopreurs have evaded a system that didn’t understand them long enough for that system to buy into them instead of swat them down, and so become wealthy, but their examples stand out as fortunate exceptions, not shining pathways.

The budget crisis is, in the short-term, politically driven for partisan purposes on most or all “sides.” In the term just past the short, however, it is a real crisis, and a systemic failure to address reality (and by no means just budget wise), and especially failure to address the public good. And that fault lies with us. Real and specific budget cuts demand sacrifices, authentically SHARED sacrifices. So do real revenue increases, although perhaps less in that arena since the main recent beneficiaries would still be as prosperous as they were in the quite prosperous 90s if they agreed to rollback the tax structure to what it was then. The people will have to exert enormous pressure—given their reduced effectiveness, far more than they would have had to previously—to make either and both of those happen.