Archive for October 5th, 2009
Not all right-wingers have completely lost it. Not yet.
Now before you assume that I’m a knee-jerk liberal, keep in mind that I once voted for a Republican, Ronald Reagan, and I am still attracted to many traditional positions of conservatives. And I fully admit that there are still many thoughtful conservatives out there.
That said, check out the current crop of the salient qualities of prominent Republican spokespersons. As David Brin sums it up so very well, this hasn’t been Barry Goldwater’s party for many years. Not in the least. What are the most bizarre changes we’ve seen? Here are a few from Brin’s long list:
* prudence to recklessness
* accountability to secrecy
* fiscal discretion to spendthrift profligacy
* consistency to hypocrisy
* civility to nastiness
* international restraint to recklessness
* efficiency to no-tomorrow wastrelness
* personal rectitude to flagrant licentiousness
I would differ with Brin on one issue. I wouldn’t attribute these dysfunctions to “stupidity.” Rather, I interpret them as the results of a combination of fearfulness, groupishness, over-reliance on disgust as a form of morality, and deep compulsion to constantly display badges of group membership.
In this month’s Rolling Stone, Matt Taibbi once again takes on Wall Street with an article entitled “Wall Street’s Naked Swindle.” This article is not yet available online. Taibbi’s focus this time is naked short selling. Taibbi has proven to be an excellent teacher of abstruse financial concepts, including the concept of short selling, and also including the insidious practice of naked short selling. With this technique (and others) Wall Street has turned the economy into “a giant asset-stripping scheme, one whose purpose is to suck up the last bits of meat from the carcass of the middle class.”
Taibbi’s article is an excellent read, which is not at all surprising given Taibbi’s track record. The bottom line is that naked short selling is a “flat-out counterfeiting scheme.” How bad is the widespread use of this technique?
That this particular scam played such a prominent role in the demise of [Bear and Lehman] was supremely ironic. After all, the boom that had ballooned both companies to fantastic heights was basically a counterfeit economy, a mountain of paste that Wall Street had built to replace the legitimate business it no longer had. By the middle of the Bush years, the great investment banks like Bear and Lehman no longer made their money financing real businesses and creating jobs.
As Taibbi then reminds us, there is more than one way to counterfeit. Consider credit default swaps:
If you squint hard enough, you can see that the derivative-driven economy of the past decade has always, in a way, been about counterfeiting. At their most basic level, innovations like the ones that triggered the global collapse-credit default swaps and the collateralized debt obligations-were employed for the primary purpose of synthesizing out of thin air those revenue flows that are dying industrial economy was no longer pumping into the financial bloodstream. The basic concept in almost every case with the same: replacing hard assets with complex formulas that, once unwound, would prove to be backed by promises and IOUs instead of real stuff.
In this related piece, Taibbi further discusses “naked short selling”:
Again, a lot of this stuff is complicated and not only hard for people outside the finance world to follow, but kind of, well, boring as well. But it’s through these tiny regulatory loopholes, these little nooks and crannies, that the economy gets manipulated. The effect of all of these regulatory gaps has been to transform Wall Street from a means of connecting capital to good business ideas into a giant casino, where the object of the game is shaving little slices off the great flows of money as you push them back and forth using a great big toolbox of manipulative techniques. This is one of the tools.
Arianna Huffington referred to the Brennan Center’s recent study in reminding us that 300,000 homes are foreclosed every month in the U.S. This is terrible news for the people who used to make those houses their homes. But the problem is bad for the rest of us too:
[A]n estimated 40 million homes are located next door to a foreclosed property. The value of these homes drops an average of $8,667 following a foreclosure. This translates into a total property value loss of $352 billion. And vacant properties take a heavy toll on already strapped local governments: an estimated $20,000 per foreclosure (California is estimated to have lost approximately $4 billion in tax revenue in 2008). And the negative impact of a foreclosed home can affect the entire community: a one percent increase in foreclosures translates into a 2.3 percent rise in violent crimes.
The twelve countries with the highest quality of life do not include the United States. We come in at number 13, which means that we”re not doing badly as a whole. But we’re not doing as well as we should be doing, assuming (as many conservatives insist without reference to any metric) that there is no greater country than the United States. We were beaten in the rankings by many “socialist” countries, such as Norway, Canada, Sweden and France.
The U.N.’s measurement system is the Human Development Index, a complex objective formula, not a subjective determination. Some of the many dozens of factors that go into the HDI include the following:
- Adult illiteracy rate
- Asylum seekers by country of asylum
- Average annual change in consumer price index (%)
- Children underweight for age (% under age 5)
- Combined gross enrolment ratio in education (%)
- Earned income (estimated), ratio of female to male
- Female adult literacy rate (% aged 15 and above)
- Female estimated earned income (PPP US$)
- Female life expectancy at birth (years)
- GDI rank
- GDP per capita (PPP US$)
- Government expenditure on health as a percentage of total government expenditure
- Government expenditure on health per capita (PPP US$)
- Healthy life expectancy at birth (years)
- Human development index value
- Human poverty index (HPI-1) rank
Consider, also, this recent news from the Commonwealth Fund:
Although the United States now spends $2.4 trillion a year on medical care — vastly more per capita than comparable countries — the nation ranks near the bottom on premature deaths caused by illnesses such as diabetes, epilepsy, stroke, influenza, ulcers and pneumonia