Monday, January 08, 2007
In a year of resurgent prime time game shows, does anybody remember the long running "Truth or Consequences?" In the show, contestants were asked to answer a difficult question and if they failed to get the "truth," they had to perform some zany and often embarrassing stunt as a "consequence." It would seem, somehow, that Truth or Consequences is back, with all of America as the contestant, and that the war in Iraq is some awful consequence of our failure to get to the truth.

The problem is that none of the decision makers that had a stake in bringing about the second Gulf War believed how ugly the consequences of their decisions would be. Take, for example, Saddam Hussein. Saddam believed that after fighting the Iranians to a stalemate for a decade and surviving and then fighting the Americans in Gulf War I and surviving, that he could pretty much survive anything. Saddam clearly misunderstood the Bush administration's resolve to see his regime toppled and as such found himself hiding in a hole, only to face the hangman's noose a few months later. Had Saddam thought through the consequences of his continued intransigence, he might have opted for a course similar to Muammar Qaddafi, another former pariah dictator, who is suddenly not only tolerated but even cited as an example of reason in the Middle East. By giving up two of his security agents (indicted by the World Court for their role in the Lockerbie bombing), and agreeing to verifiably surrender his covert nuclear program, Qaddafi not only saved his own skin, but is now being courted by many Western companies eager to develop the resources in his country.

Similarly unaware of the consequences of their actions are those in the Bush administration who launched a very successful attack on Iraq without thinking through the aftermath. Thomas Friedman of the New York Times (who advocated the forceful overthrow of Saddam's regime) famously wrote before the war that "if you break it, you own it," warning Americans that putting Iraq back together again was no small task. Few expected the overthrow of Saddam's regime to be as relatively easy as it was, yet the administration had clearly not thought through the consequences of "owning" Iraq following the military victory.

The Historian and journalist, Michael Oren once remarked that "there are only 3 nation states historically in the Muslim Middle East: Egypt, Iran, and Turkey. The other nations are make-believe. The borders are arbitrary and the governments are artificial." Nowhere is this more true than in Iraq. The country we know of today as Iraq has not been a cohesive entity since the days of the Babylonian emperors who fell to the Persians (under Cyrus the Great) in 539 BC. Modern Iraq was born out of the 1919 Paris Peace Conference, which formally made the country a British mandate. The borders of the modern country were drawn, rather carelessly, by the British along the lines of the Sykes-Picot agreement of 1916 with the French, whereby the former Ottoman territories were divided between the two allied powers on the assumption of victory over the Turks and their German allies. Whereas under the Turks there were three distinct provinces of Mosul, Baghdad, and Basra divided under historical, tribal, and ethnic lines, the British lumped all of these areas together and called them "Iraq."

The British hadn't clearly thought through the consequences of their actions, and when Iraq became independent in 1932, it saw a few kings from the (British installed) Hashemite line, only to see the monarchy violently deposed in the 1950's to be followed by a series of strong-men dictators, culminating in the rule of Saddam Hussein in 1979.

Having now overthrown Saddam, it would seem that many Americans are not thinking through the consequences of their actions in Iraq either. While the Bush administration clearly underestimated the difficulty of the job it would take to rebuild Iraq, his critics are similarly underestimating the chaos that would result as a consequence of our leaving. "Bring home the troops" may make for a nice slogan, but if anyone thinks the world will sit idly by as Iraq disintegrates, they are clearly ignorant of the region's history.

All of Iraq's neighbors have a large stake in the outcome of the current sectarian strife. Saudi Arabia has publicly stated that if America leaves it will "have no choice" but to support the Sunnis in their battle with the Shi'a. Iran clearly has a vested interest in supporting their Shi'a kinsmen; while Syria and Turkey -- both of whom have large Kurdish minorities -- have varied interests in any "civil war" that may result.

In fact, the very term "civil war" is something of a misnomer in describing Iraqi current events. A civil war implies fighting between fellow citizens for dominion over a nation. The violence in Iraq today is at worst tribal, and at best confessional. It is highly unlikely that any one group could claim dominion over the entire area of Iraq as the spoils of military victory. More likely, the country would disintegrate into loose confessional confederations not unlike the old Ottoman provinces.

If Americans want to understand the "truth" of what is going on in Iraq today, we must realize that we are directly responsible for bringing down the old order, and like it or not, it is now our responsibility to bring about a new order. This new order will help shape the Middle East for decades to come and is vital to our national interest. The "consequence" of our actions is that we can no more simply "bring home our troops" then we can allow Iran to control the region.

While we cannot simply exit Iraq, we are not out of options either. We might learn something from the way the Turks ran the provinces we now know as Iraq. They were once a loose confederation of locally administered provinces answerable to the Turkish Sultan. Americans do not claim dominion over Iraq and have no interest in establishing hegemony over the country. Bush has publicly claimed that he would like to see Iraqis establishing a pluralistic, Democratic country that will act as a bellwether against the spread of Islamic extremism in the region.

Perhaps one way to achieve this is to reduce the day to day friction of Western soldiers patrolling the streets of Iraqi cities. As soon as the Iraqi army and police forces are strong enough to take over the duties of security, a task they are increasingly already doing, American forces could consolidate into fortified bases responsible only for strategic threats. America can maintain order and act as a bulwark against interference by Iraq's neighbors, while Iraqis themselves begin to build their country and their institutions. Instead of insisting on a strong federal system from Baghdad, we can instead encourage a weaker federation of provincial governments much like what is happening on the ground today anyway.

The Kurds have been running a state within a state in the north since Gulf War I. The Shi'a have near autonomy in the South, while the Sunnis continue to fight because they see their privileged status from the former Iraq disappearing as the Shi'a gain increasing power in Baghdad. By giving the Sunni a provincial government of their own in the center of the country, answerable to a central Federal authority in Baghdad, we would be pragmatically restoring a system that held for hundreds of years while not tearing apart the modern Iraq.

For too long both the advocates and critics of American policy in Iraq have ignored the truth of what's been going on or the consequences of their preferred ideologies. We have too much at stake as a nation to ignore the problems we have played such a large part in creating. The best we can hope for now is to think carefully through the consequences of our decisions on the ground and begin to shape a pragmatic solution that will make the region, and by proxy the world, safer for Western style liberalism.
Monday, January 08, 2007 11:27:41 PM (Pacific Standard Time, UTC-08:00)  #    Comments [0]  | 
Sunday, November 05, 2006
The mid-term elections are approaching quickly and in many states, including my home state of California, the list of candidates up for election seems dwarfed by the litany of propositions on the ballot. No less than 13 propositions are up for a vote in California, with yet more at the local level. Of those 13, 9 are either direct tax increases or bond measures (indirect tax increases). It's time for the voters of California to send their legislators a message: "Stop wasting your time figuring out how to take more of our money and learn how to wisely spend the billions you've already taken."

It has always amazed me just how different the state budgeting process is from our personal budgeting. When figuring out a household budget, we first determine how much income we have. Then we figure out how much of our spending is obligatory. Finally we decide to save, invest, or spend any excess funds. State budgeting, however, seemingly works a little differently: First the legislature determines how much it spends. Then it determines how much more it wants to spend. Then it figures out how much it actually has. When, inevitably, it has less than it wants to spend, it doesn't cut back on expenditures, rather it creates committees to determine how to raise taxes and get more money. When raising taxes is not politically expedient, the state can instead sell bonds and borrow more money, knowing that they can always raise taxes later when the obligatory spending to repay that borrowing becomes due (often conveniently in a successive political term).

Using this method, politicians can (disingenuously) claim that they have avoided cutting back popular programs and avoided raising taxes. This would be wonderful, if only it were true. If you needed to spend more money but continued to earn the same income and pay the same basic expenses, that deficit would probably translate into credit card (or other forms of) debt. You would simply be paying later (with interest) what you spent today. In California, the almost $20 billion in "infrastructure" bonds that Gov. Schwarzenegger is backing will do exactly that.

California's current total debt is approximately $78.7 billion. Servicing this debt costs about $3.3 billion a year, or about 4.5% of California's annual budget. If the voters in the state approve another $20 billion in bonds -- a staggering additional 30% more debt -- maintenance would rise to over $4.5 billion a year or more than 5% of the budget.

During the last special election, the issues on the ballot were predominantly about fiscal constraint and Gov. Schwarzenegger famously spoke of "living within our means." The voters resoundingly rejected living within our means after organized labor, led by the California Teacher's Unions, realized that living within our means might impact them. No problem, the governor simply changed his mind completely and decided to "rebuild California" and issue $20 billion in debt for infrastructure, all "without raising taxes," he promises.

Selling bonds for spending today -- essentially mortgaging tomorrow -- is particularly insidious, because the repayment falls disproportionately on one segment of society: Homeowners.

According to the Wall Street Journal more than two thirds, or (a record) 69% of American families now own their own homes, up from 65% in the 1990's. Unfortunately, this is precisely the reverse in Los Angeles, as well as other large metropolitan areas. Approximately "61% of L.A households don't own the places where they live, one of the highest rental rates in the country, according to the 2000 census." So about two thirds of the population thinks that by issuing bonds, they are in essence forcing the one third of the population who are homeowners or landlords to pay for all the new debt. This would again be very convenient, if only it were true.

In 1978, California's taxpayers revolted and passed a landmark proposition, known to this day as Prop. 13. The proposition famously limited property tax to 1% of the assessed value of property and ensured that the state could not raise the assessed value more than a maximum 2% a year. Prop. 13, however, exempted "voted indebtedness" (bonds) from this maximum. Limited in their ability to raise property taxes, the state and various localities have been resorting to bonds ever since. The interest on those bonds has, in some areas, literally doubled the allowed property tax rate to 2%. California homeowners feel this hit directly as their property tax gets paid in two lump sums throughout the year. California renters, however, feel the effects of this borrowing and taxation only indirectly: when landlords pass these costs on in the form of higher rents. The average rent in Los Angeles is now $1,750 a month, a jump of 82% in the past 10 years. Clearly renters are not getting a free ride (unless they're rent-controlled), however most don't see the effect of their ballot decisions until long after the elections are over.

Perhaps the most insidious of this year's crop of propositions is Prop. 88. For the first time since the 1970's, Californians are considering scrapping one of the key reforms of Prop. 13 and amending the state constitution to allow direct parcel taxes. Misleadingly marketed as a "save our schools initiative," Prop. 88 would establish an "initially modest" $50 per parcel tax on all property in California. What it really does is open the door wide open for the legislature to begin creating all sorts of new parcel taxes; precisely what they'll need to pay for all the borrowing they're hoping to do. Are we really willing to allow the reversal of one of the most important tax reforms in state history or are we simply being misled by glitzy television advertising?

California's infrastructure clearly needs improvement: Our schools are in trouble, our roads are a mess, our hospitals and prisons are overflowing. We all have a vested interest in dealing with these problems. The question is, do we want to deal with them directly today by creating a responsible budget or do we again want to allow our politicians to take the easy way out by simply taking more money from the taxpayer? Let's make our politicians earn their salaries by finding ways to spend the money they have better, not by spending their time thinking of creative ways to raise our taxes or borrow more money. Let's "just say no," across the board, to all the state ballot propositions.
Monday, November 06, 2006 7:29:13 AM (Pacific Standard Time, UTC-08:00)  #    Comments [0]  | 
Friday, September 01, 2006
My wife recently received a letter in the mail that she is "entitled" to a part of a class action settlement reached in the case of Strugano et al v. Nextel Communications. In her case, Ms. Strugano alleged that Nextel unlawfully and without her consent changed the terms of her agreement by adding a $1.15 monthly fee and rounding the billing on her calls to the next minute instead of to the next second. Rather than litigate the case and risk the vagaries of an obscene jury award, Nextel agreed to settle the case. Nextel paid out up to $55 million to settle, from which Ms. Strugano received $5,000 as lead plaintiff; her attorneys received $2.5 million for their troubles; and my wife received a $10 phone card.

Cases such as these are becoming all too common in the American legal landscape. The tort system now awards more than $240 billion a year, most of which ends up with the lawyers who litigate the cases. The extremely large legal payoffs are not only a consequence of these suits, increasingly they are also the motive.

In May 2006, the law firm Milberg Weiss was indicted on charges of fraud in connection with 150 suspect cases. These cases, in which two of its partners, Steven Schulman and David Bershad allegedly orchestrated "a long running scheme to pay off the named lead plaintiffs in the shareholder lawsuits the firm has built its reputation in pursuing," earned the pair over $200 million in legal fees between 1991 and 2005. The indictment alleges that the firm paid these "claimants," such as Seymour Lazar, over $11 million in illegal kickbacks in order to bring claims to the firm against such well known companies as British Petroleum, Genentech, Krispy Kreme, and others.

In effect, the law firm was literally orchestrating which firms to go after and paying potential plaintiffs to file suit and retain the firm on their behalf. While the settlements of these cases netted over $45 billion in the 10 year period ending in 2005, Milberg Weiss earned $1.7 billion in legal fees and costs. In fact, almost half of the securities class action settlements awarded during this period were brought by this law firm. Far from being a vehicle of justice for wronged plaintiffs, these class action law suits are an industry in which these types of law firms excel.

Of course class action law suits are far from the only legal vehicle rife with exploitation among trial lawyers. In 2003, three California trial lawyers were forced to resign from the state bar after having been found to have violated the bar's ethics codes. According to The Press Enterprise (Riverside, Calif.) the Trevor Law Group and a one-man, for-profit enterprise named "California Watch Enforcement Corp." sued the owner of a motorcycle shop in Riverside for abbreviating the words "on approved credit" (O.A.C.) in a print advertisement. According to the owner, he got a letter from the Trevor lawyers saying they'd accept $5,000 to settle the matter out of court. In 2002, the Trevor firm filed more than 2,000 law suits against auto-repair shops in California for alleged "unfair business practices," usually based on minor technical violations of the Automotive Repair Act that appears on the Bureau of Automotive Repair's website. Most of these cases where then settled with the Trevor Law Group for small sums that the firm later acknowledged made up the vast majority of their income.

Originally designed to allow a degree of legal protection against companies whose deep pockets would otherwise make them untouchable by the average consumer, the civil legal system is now being used to extort firms and their shareholders for large payoffs. The attempt to level the playing field between consumers and corporations has created a lucrative industry for lawyers well versed in these public shake-downs. The Federal Class-Action Fairness law of 2005 attempted to correct the problem somewhat by making it significantly easier to "remove" class action law suits from more easily manipulated state courts to more conservative Federal courts. While certainly a good start, the bill does very little to provide any real disincentive to the law firms extorting millions from American industry.

Those same millions have often flowed generously to political campaigns to ensure that little is done to stem the flow of legal largess. If our politicians were willing to take a stand against some of these corrupt trial lawyers, there is quite a bit that could be done to make it more difficult for dishonest firms to exploit the system. First the system of "loser pays," in use in Britain and many other European countries could be put into place. This would ensure that the tougher Federal courts would make it very expensive for some of these firms if the merits of their cases are questionable. At the very least it would make many firms think twice about filing long expensive cases if they thought there were a possibility that at the end of the day they'd have to pay their quarry's legal fees as well as swallowing their own. Furthermore, the barriers to certification of a "class" could be set higher so that it would be more difficult for a firm to file a lawsuit on behalf of potentially millions of unnamed claimants. Lastly, if we really want to get serious about the problem, we could change the jury system for civil cases so that a professional panel of judges hears these cases instead of much more easily manipulated juries.

Much can be done to slow the rapid growth in legal abuse in the United States. Already the massive legal cost of these cases is straining the profits and in some cases the very business of many major American firms. Most of the companies are public firms owned by shareholders whose values are eroded by the huge judgments, settlements, and even threats of pending litigation. Small businesses, the heart of our economy, can rarely withstand the high price of fighting this kind of litigation. It is important to maintain the ability of consumers and individuals to seek redress for the abuses of industry, however it is also important to defend industry from the extortion and legal blackmail of lawyers who make this practice a living.

It is time to demand responsible tort reform from our politicians. To continue closing our eyes to this abuse could mean losing our jobs and having our salaries paid out instead to some unscrupulous law firm in exchange for a $10 phone card.
Saturday, September 02, 2006 12:19:15 AM (Pacific Daylight Time, UTC-07:00)  #    Comments [0]  | 
Friday, April 14, 2006
"All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the state wherein they reside. No state shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any state deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws."

Known as the equal protection clause or the due process clause, the 14th amendment to the constitution guarantees citizenship to anyone born in the United States. The 14th amendment, passed in 1868, is one of a series of post civil war amendments that was designed to prevent the defeated confederate states from enacting legislation to subjugate their former black slaves. By ensuring that anyone born within the US would be a US citizen, congress aimed to prevent a permanent black underclass in the South that would not enjoy equal protection under the law.

Like many other clauses in our constitution, the basic principles have evolved over time to mean rather different things to our society. Due process and equal protection are often used today as the basis of law suits over discrimination. Birth-right citizenship, no longer a racial issue, has become an immigration issue. Immigrants who want to come to the US, either legally or illegally, often shortcut the bureaucratic procedures of the US and give birth to a child on US soil, thus "anchoring" their families in America. The 14th amendment guarantees their children citizenship and equal protection, or does it?

The United States is one of very few countries that has birth-right citizenship. Most other countries give citizenship at birth only to children of current citizens. Switzerland, for example, recently defeated a referendum aimed at bestowing citizenship to third generation residents. This means that people born in Switzerland whose grandparents immigrated there are not considered Swiss citizens! Other countries who had birthright citizenship such as Australia and New Zealand have recently done away with it opting instead for parental citizenship rights.

In explaining their decision, the government of New Zealand writes: "The Government chose to amend the Citizenship Act of 1977 to recognize the value of New Zealand citizenship. The changes mean that a person cannot travel to New Zealand on a temporary permit solely to give birth and gain New Zealand citizenship for the child born in this country. By restricting citizenship by birth to the children of citizens and permanent residents, the Act's new provisions ensure that citizenship and its benefits are limited to people who have a genuine and ongoing link to New Zealand."

The citizenship clause of the 14th amendment never actually intended to bestow citizenship to foreign aliens. Sen. Jacob Howard, the clause's author, explained it to the Senate in 1868 as follows:

"[T]his amendment which I have offered is simply declaratory of what I regard as the law of the land already, that every person born within the limits of the United States, and subject to their jurisdiction, is by virtue of natural law and national law a citizen of the United States. This will not, of course, include persons born in the United States who are foreigners, aliens, who belong to the families of ambassadors or foreign ministers accredited to the Government of the United States, but will include every other class of persons."

Birth right citizenship, as we know it today, came into effect in 1898 when the Supreme Court expanded the scope of the 14th ammendment in US v. Wong KimArk. In this case, a Chinese laborer born in the US of Chinese parents was denied entry into the US after a temporary visit to China. Wong KimArk claimed US citizenship under the 14th amendment, and the Supreme Court agreed. The Supreme Court chose to ignore its own precedent from Elk v. Wilkins in 1884 which held that "The persons declared to be citizens are, 'All persons born or naturalized in the United States and subject to the jurisdiction thereof.' The evident meaning of these last words is not merely subject in some respect or degree to the jurisdiction of the United States, but completely subject..." Furthermore, the court expanded the definition of citizenship on the basis of British Common Law that predated the US.

Pro and Anti Immigration activists have been arguing the point ever since. This argument has reached somewhat of a crescendo recently as Congress considers sweeping changes to US Immigration laws. The problem is that despite the loud street protests and heated debate on both sides, much of the legislation is simply much ado about nothing. Based on the current law of the land, any "illegal" immigration into the United States is necessarily temporary in that it is limited to only the current generation.

The heated arguments about whether to legalize 12-15 million undocumented migrants (estimates vary) seemingly ignores the fact that any children born to these migrants are currently US citizens. Those wishing to remove or deport the illegal migrants also seem to ignore that, despite the logistical problems that would result, under current US law families of US Citizens -- their children -- are entitled to special protections.

The Congressional debate over immigration is a valid and constructive debate that Americans need to consider with care and wisdom. The current proposals, however, fail to actually solve the current problem. The House of Representatives' bill, which would turn most current illegals into felons, doesn't seem to consider what exactly we'd do with 12-15 million new felons (5% of the population) walking the streets, many of whom have American children. The Senate's bill, which would create some sort of legal status for migrants already here seems to ignore that the problem is getting worse daily as we do nothing to check the flow across the border.

If we truly want to do something to actually solve the immigration problem, we really need to define how much immigration we can (and wish to) absorb. Immigration without any limits would quickly stretch any citizenry's infrastructure and ability to cope. We could choose to check the flow of migrants across the border and prevent the problem from getting any worse. Once that is done, and only once that is done, then a serious discussion should occur about what to do with the people currently here, a problem that actually disappears entirely in one generation.

Alternatively, Congress could move to change birthright citizenship. This would take years, if enacted, to go through the courts. Ultimately, the Supreme Court would need to decide if the issue is decidable by statute or require a Constitutional amendment which would inevitably end the discussion. A guest worker program with no birth right citizenship could be another potential solution to the problem.

Either way, piecemeal legislation that panders to one political group or another would do very little to ease the problem as the amnesty bill of 1986 has shown. When Reagan proposed amnesty to 2.8 million illegal aliens at the time, he promised that it would be a "one time deal." There have been 6 more "one time deals" since then and the current legislation would be, by far, the biggest yet. If we wish to prevent having to pass a new amnesty every few years, steps must be taken to ensure a solution to the problem. Perhaps, as Thomas Friedman of the NY Times writes, "build a big fence with a big gate," or perhaps end birthright citizenship. Citizens of the United States should demand no less from their representative government.
Friday, April 14, 2006 5:13:38 PM (Pacific Daylight Time, UTC-07:00)  #    Comments [2]  | 
Monday, March 27, 2006
Let's talk about debt, baby. Let's talk about you and me. Let's talk about all the problems, and the bad things that may be...

Alright, so perhaps that isn't exactly how you remember that song from the 80's, but unlike "Salt 'N Pepa," this problem is here to stay for a while.

Last week the US Senate voted to increase the federal debt limit by $781 billion, raising the debt ceiling to nearly $9 trillion. Soon thereafter, the congress passed a $2.8 trillion budget including $92 billion in additional war spending and hurricane recovery funds.

Let's take a second and let those numbers sink in. The United States owes about $9 Trillion. That's more than 3 times the budget we just passed for next year. There are about 300 million citizens in the US. Quick arithmetic shows that each and every man, woman, and child in this country is now in debt around $30,000 to cover this. Congratulations, I guess we all just bought new cars (yes, including the baby).

Anyone curious can actually see the current government debt, to the penny by looking at the Dept. of Treasury's website. The interest expense on this debt is also available from the treasury. This shows the interest payments for 2005 to be just over $352 billion or about 16% of the 2005 budget ($2.15 trillion).

In order to get a clear picture from these statistics, let's generalize for a moment. Imagine the federal budget as a large round pie. Now slice that pie into 3 nearly equal thirds. The first third represents the part of the budget eaten by defense. The second third represents the "entitlement" or non-discretionary spending of the United States (Medicare, Social Security, etc...). The last third represents everything else, all the discretionary spending from highways and parks, to education and housing. Now take this last third that represents all the government programs that are so dear to many voters and cut it clean in half. Take one of these halves and give it to your lender for that represents the interest we are paying on our debt.

Unfortunately for all of us, every single one of these "slices" is growing and the tax revenue from the economy is not keeping up. The difference, of course, is what we are borrowing to make ends meet and that is the federal deficit ($318 billion in 2005). Every time the deficit is a positive number, we have just borrowed more money and are increasing our debt. Every increase of the debt requires more interest maintenance leaving less and less for discretionary spending.

Of course, like our own families, the government can't continue borrowing money forever. In the short term, increased debt means higher interest costs to borrow more. We are already seeing this take place as real interest rates have risen dramatically over the last two years. In the long term, we simply cannot have our entire discretionary budget be eaten up by interest payments so something needs to be done. What can be done? Just like we all need to decide for our own family budgets, there are really only 3 options: 1.) Make more money (raise taxes) 2.) Spend less money (cut programs) 3.) Continue borrowing at higher and higher cost.

President Bush inherited a surplus when he took office in 2001 and has run deficits ever since. Politicians naturally prefer to borrow more money, as opposed to raising taxes or cutting programs as there is far less fallout in the short term from voters. California is a particularly poignant example of this policy. The problem is that they are simply delaying the problem (and making it much worse) for the next officeholder. Whoever wins the next presidential election will likely have no choice but to combine cutting spending and raising taxes, a sure-fire approach towards short term economic shrinkage. In real terms, this means that our standard of living is likely to drop in the future to pay for the spending-spree we've been "enjoying" over the last few years.

In reality, tax cuts, two wars, high energy prices, homeland security spending, natural disasters, and a major expansion of Medicare have left us in need of vast amounts of money that much of the rest of the world have so far been happy to offer us in exchange for higher interest rates. As most of us realize at home, it's easy to spend money, especially borrowed money. It's much harder to pay it back. We, as a country, have managed to spend ourselves into a pretty deep hole that will require some painful discipline to extricate ourselves from.

One of America's greatest poets, Ralph Waldo Emerson once warned "A man in debt is so far a slave." The United States used to be world's largest creditor, now we are the world's largest debtor. While much of our debt is still to ourselves in the form of privately held government bonds, we are increasingly beholden to foreign powers lending us money. If we are to retain our place as the world's greatest economy and wish to set our policies according to our own interests and not that of our creditors, we absolutely must start putting our own financial house in order.
Monday, March 27, 2006 10:03:44 PM (Pacific Standard Time, UTC-08:00)  #    Comments [2]  | 
Sunday, March 05, 2006

Dear President Bush,

I am not one of your vehement detractors. I am not one of your avid supporters. I am not a staunch conservative, and I am not a bleeding-heart liberal. I am a well-educated, pragmatic "middle of the road" American who is too often ignored in today's increasingly polarized politics. I voted for you, and I am disappointed in you. If you are interested in regaining my trust, and with it perhaps the trust of many Americans like me, here are some suggestions:

One of the great American maxims holds that you should "say what you mean and mean what you say." Following this policy would already take you a great deal of the way towards regaining credibility. For example, your 2006 State of the Union address proclaimed some grand ideas on some very critical issues. You told us that "we have a serious problem: America is addicted to oil, which is often imported from unstable parts of the world." You are absolutely right, however the problem is, that I don't believe you're actually doing anything substantial to change it.

You could have announced a new "Manhattan project" for the 21st century to develop this critical technology. You could have announced a US equivalent to the Ansari X prize (you know, the one that offered $10m to anybody who could viably launch themselves into space and return -- twice) that would reward private initiative into alternative energy. You could have announced a gradual mandatory increase in the required MPG ratings for all cars sold in the United States. You could have done many things to lead this country, and the world, into greater energy independence but instead only offered that "Since 2001, we have spent nearly $10b to develop cleaner, cheaper, and more reliable alternative energy sources." Unfortunately, spending about $2b a year is a drop in the bucket and doesn't amount to any substantial government investment in changing our addiction to oil. If this is all the Federal government is willing to do, then why mention it in your speech at all? This is precisely the problem that I have with your credibility. Words without actions are simply lip service, and paying lip service alone to the great issues of the day can only harm your reputation, not help it.

Remember in 2004 when you announced to the country that you had a "bold vision" that Americans will walk on Mars by 2020? I understand that you were trying to reinvigorate a war weary country in the same way that Kennedy did with his "Man on the moon" speech. The difference is that after proclaiming this grand vision you never followed it up with anything approaching proper resources and basically allowed the whole issue to die. The unfortunate consequence of these sorts of proclamations is that saying them and then doing practically nothing only turns a cynical public against you. It is too easy to think that this was merely a political stunt to divert attention -- albeit briefly -- from Iraq.

Speaking of Iraq... You have clearly staked your presidency on American success in Iraq. Many of your detractors think that you cynically took the country to war over non-existent WMD's, or some misbegotten personal vendetta. I supported you on the war in Iraq because cynical politics aside, the US has a vital interest in Middle East stability, and Iraq is literally the heart of the Middle East. Why not say it like it is? The United States cannot allow petty dictators to blackmail the world with energy, weapons of mass destruction, or terrorism. We couldn't allow Saddam to do it, and we can't allow the Mullahs in Iran to do it either. It is very unfortunate that pan-national bodies that have been set up to promote peace and stability have summarily failed to do so. We can not watch the UN, the EU, or anyone else allow entire regions of the world to slide into anarchy, fundamentalist theocracy, or hotbeds of terrorism. While the world debated endlessly, America acted. Why not say -- and say loudly -- that "America has no interest in empire, religious crusades, or sectarian squabbles. America has an interest in maintaining peace and promoting democracy and liberty as a means towards achieving peace." That is something everyone can understand and get behind. You should challenge the rest of the world and ask "What do you think is more dangerous, a world where America acts, even when it may be unpopular, or a world where America does nothing?" There simply is no other country that can project power the way the US can and, despite much public rhetoric, many in the world know this and thank God (whatever God they believe in) that we do.

True leadership does not require saying the things that pol's (or polls) believe to be expedient at the time. True leadership entails recognizing the tough challenges of the day and making the country understand why they are imperative. Many of today's problems are necessarily larger than any one president and may take generations to truly solve. We Americans tend to have short memories and even shorter attention spans. This is why it's important to set policies that will pass the test of time and lead us in the right direction, regardless of who sits in the oval office. This simply can't be done without credibility. Many past presidents, Wilson, Roosevelt, even Reagan recognized this and our world is better off for it. Say what you mean, and mean what you say and I will begin to believe again.

Monday, March 06, 2006 1:04:51 AM (Pacific Standard Time, UTC-08:00)  #    Comments [1]  | 
Sunday, November 06, 2005

Since the time of this last writing, one week ago, the proposition campaigns in California have gone into overdrive.  Whether all this hype and expenditure translate into numbers of ballots cast remains to be seen, but one thing is for certain:  Come Tuesday, November 8th 2005, the political landscape in California could either be substantially changed, or the drive for "reform" could be put back immeasurably.  I strongly support a "Yes" vote on the governor's propositions 74, 75, 76, and 77 and a "No" vote on literally everything else. 

Prop. 77 - Although the proposition to reapportion California's electoral districts by a panel of non-partisan retired judges was discussed last week, the major point of the opposition seems to have changed substantially during that time.  It could not be said strongly enough that if one thinks that they can get even a rudimentary understanding of an issue from a 60 second television spot, they are sorely mistaken.  In the last week or so, a new "point" against 77 seems to have gained traction on the airwaves.  Basically, the proposition's opponents have turned to racial politics to try to divide the issue further.  They claim that if 77 passes, minority voting power will be strongly curtailed.  They hint, not very subtly, that most retired judges are white males and they are likely to strip minorities of their hard-won power.  I ask the following question:  "What does reapportionment have to do at all with racial politics?"  Why not get rid of the non-partisan panel of judges and reapportion using a non-partisan pattern of geometrical shapes?  Political districts are meant to allow those living in them to vote representatives that best represent their beliefs.  Designing oddly shaped districts to enclose certain minorities is just as big an abuse of redistricting as designing oddly shaped districts to exclude minorities.  The racial argument is so far besides the point as to almost be absurd.  The opposition has very much made the point for 77:  It's high time to take apportionment power away from partisan politicians (of both sides).

Prop. 76 - Perhaps the least understood of the Governor's 4 major reforms, proposition 76 will force the state government to take a running average of the last 3 year's tax revenue and either grow or curtail state spending by the same amount.  It is meant to stop the practice of deficit spending year after year in the state budget.  By law, the state is prohibited from spending more than it makes already, but in practice a number of accounting tricks and borrowing have been used to spend far more than state coffers take in.  One very real argument against this proposition is that limiting spending by statute can seriously harm government's ability to deal with unforeseen issues.  Although the proposition does make exceptions for natural disasters, it is not too difficult to imagine that these limits could cause some problems down the road.  Unfortunately, this very rational argument has scarcely been made by opponents to 76 (most notably the teacher's union).  The biggest claim against the proposition is that it will take billions of dollars away from California schools.  While these claims are rather suspect, it still doesn't change the basic economics of the budget:  How can we continually spend more money than we have?  Whether or not the proposition will force cuts to any groups' favorite budget, the state clearly needs to balance its books sooner or later.  Unfortunately California's legislators have been unable or unwilling to do so, making proposition 76 necessary.

Prop. 75 - The most highly contested proposition on the ballot, 75 is rather straightforward:  "Should public employee unions be forced to ask their membership, in advance, for permission to use their money in political campaigns?"  Almost begging the question of why this proposition is necessary, the California's teacher's union has spent the rough equivalent of 5 years worth of dues from the union's members to defeat it.  This same union spent lavishly to keep the former governor Grey Davis in office and supports almost exclusively Democratic candidates.  In this same election, however, California teachers actually voted 54% in favor of electing Arnold Schwarzenegger, the Republican candidate.  That means that 54% of the union's membership had their dues money taken away from them to support a candidate that they disagreed with!  The union believes that 75 will cripple their ability to get things done in Sacramento, and they are probably right.  The question most Californians should be asking however is:  "Should the same unions who are paid out of the public treasury be allowed to exert disproportionate influence on those who control that treasury?"  This issue has nothing to do with education and everything to do with who has control over the public's finances. 

Prop 74 - Yet another issue that has caused the teacher's union to become bitter enemies of Governor Schwarzenegger, proposition 74 will increase the number of years required to gain tenure in California schools from 2 years to 5 years.  The teacher's union likes to make it seem like they are being picked on by the Governor, however they have failed to make any convincing arguments as to why it is unfair to ask a teacher to work for 5 years before being all but guaranteed a lifetime job?  Tenure rules don't apply to virtually any other profession besides teaching and virtually no one else -- excepting perhaps the legislators in Sacramento -- are currently all but guaranteed a job for life.  It is easy to see why a teacher would be against this proposition, but it is very difficult to see why anyone else would be?

Monday, November 07, 2005 5:17:43 AM (Pacific Standard Time, UTC-08:00)  #    Comments [0]  | 
Sunday, October 30, 2005

There is science, logic, reason; there is thought verified by experience. And then there is California. Edward Abbey felt this way decades ago about his adopted home in the West and the same holds true today. We are a state born of a gold rush, a panacea of quick riches that launched us onto the national stage. 150 years later the new gold rush of high-tech and the glamor of Hollywood keeps California a place where the eyes of dreamers turn the world over. We are also a state who's political system is seriously broken.

Like 24 other states, California has a system of initiative and referendum whereby citizens who gather sufficient signatures can petition voters directly to pass laws and even amend the constitution while completely bypassing the state legislature. This system is so popular in California that there have been no less than 79 statewide propositions since November 1998. There is good reason for the voters of this state to go directly to the citizenry to get things done: The California legislature in Sacramento is so beholden to their established interests that it is virtually impossible to enact any real change through them.

The pinnacle of special interest politics seemingly was reached during the 2002 California gubernatorial election when one of the most unpopular and ineffective governors the state had ever seen was elected to a second term. Gray Davis, the incumbent Democratic Governor actually spent more money in the Republican primary election to defeat former L.A. mayor Dick Riordan then he did on trying to get himself elected against a virtually politically unknown Bill Simon. Against this backdrop in 2003, Californians took the unusual step of recalling the ineffectual governor and replaced him with the Hollywood star and Sacramento outsider Arnold Schwarzenegger. "The Gubernator," as he became known during the campaign took office amid a mood of reform promising to "fundamentally change the way California does business."

Unable to reform the state's government with the legislature, Schwarzenegger decided to bypass them altogether and take his reforms directly to the people. The heart of these measures, a series of 4 key ballot propositions will go up for a vote on November 8, 2005. Prop. 74 raises the number of years required for a teacher in the public school system from 2 to 5. Prop. 75 changes the method by which Public Employee Unions collect dues from their members from an "opt out" system to an "opt in," whereby members must specifically give their unions permission to spend their dues on political causes. Prop. 76 slows the rate of growth of the state budget and limits the ability to borrow money. Prop. 77 shifts the power to "redistrict" (or Gerrymander) from the legislature to a panel of retired judges.

These ballot propositions launched a campaign battle more expensive than many national races. The San Francisco Chronicle estimates that mostly union sources have spent approximately $115 Million thus far to defeat these propositions, especially Prop. 75 which they believe can decimate their power in Sacramento. Pro-Schwarzenegger groups have spent about $45 Million to try to get their measures passed. So why is so much money being spent on a special election with not a single candidate running? Put simply, the reform initiatives can fundamentally transform government in California. This can accomplish much to make government work better for the people of the state while at the same time doing serious damage to special interests who have controlled state politics for so long. I strongly urge a "Yes" vote on 74, 75, 76, and 77 and here's why (in order of importance):

Prop. 77 - Despite the ability of citizens to get propositions on the ballot in California, the fundamental responsibility of legislating law in this state still lies with the legislature in Sacramento. According to Governor Schwarzenegger "153 of California's congressional and legislative seats were up in the last election, and not one, I repeat, not one, changed parties." Specifically, California's solidly Democratic legislature has been drawing up districts that are designed to pack their opposition into the smallest number of possible seats. What this proposition does is to remove the power to draw these districts from the politicians in Sacramento and give the power to a non-partisan panel of retired judges. This will not necessarily tilt the balance of power in California -- nor should it. It will however allow regions of the state to actually have their vote heard, rather than have any opposition sidelined into a permanent minority. Ideally, districts would not need to be redrawn for anything other than population increase. Make no mistake, this isn't an issue of Democrat vs. Republican, it's an issue of incumbents vs. everyone else. Today's legislature have drawn themselves "safe seats" that are unlikely to change any time soon. Proposition 77 will end this practice for good.

More on the California Propositions in Part 2.

Monday, October 31, 2005 12:52:20 AM (Pacific Standard Time, UTC-08:00)  #    Comments [0]  | 

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