Our Next War?

Juan Cole has a great piece up at Informed Comment:

Meanwhile, the main strategy of the Israeli and Jewish-American Right to preserve Israeli capacity to continue the colonization and to act belligerently in the region had been the overthrow of Saddam Hussein in Iraq. That strategem has failed, as I argued in Salon. The Shiite fundamentalists who have taken over Baghdad are pro-Hizbullah and pro-Palestinian. (Hizbullah was in part set up by the Islamic Mission Party, Da'wa, of Iraqi Prime Minister Nouri al-Maliki, and Da'wa supported Hamas in the recent Gaza War).

Moreover, Baghdad has ceased helping contain Iran for the Sunni Arab world and the West, and is now a close ally of Tehran. The prospect of a well-armed, 250,000-man Iraqi army now being reconstituted, and riddled with agents of the Iranian Revolutionary Guards Corps, must be a matter of consternation for Israelis. Only Jordan separates them from Iraq, now an outpost of the Shiite religious parties allied with Khamenei. The Neoconservatives, such as Richard Perle, David Frum, Paul Wolfowitz, Irv Lewis Libby, Michael Rubin, Douglas Feith, John Bolton, Larry Franklin and others thus not only shot themselves in the foot, but they shot Israel in the chest.

These same people are now agitating for a war on Iran, which is not of any particular strategic importance to us, is not anywhere near acquiring the nuclear weapons it has a right to acquire, and hasn't launched a war of aggression in over 200 years.

If they are successful, we will find that we are the proxies in a war against Iran on behalf of Israel.

With friends like Israel, who needs enemies?

Inhofe's Igloo

Friedman:

When you see lawmakers like Senator Jim DeMint of South Carolina tweeting that “it is going to keep snowing until Al Gore cries ‘uncle,’ ” or news that the grandchildren of Senator James Inhofe of Oklahoma are building an igloo next to the Capitol with a big sign that says “Al Gore’s New Home,” you really wonder if we can have a serious discussion about the climate-energy issue anymore.

More specifically, you wonder if Republicans can have a serious discussion about any issue, because let's be honest-they are either the stupidest group of people to ever hold legislative office in this country, or they are the most dishonest, unpatriotic, and disgusting bunch of assholes in Congress. And that's saying quite a bit. 

Priorities

You'd think that they would have done studies to determine if pot is harmful or helpful before declaring a war on it, wasting untold billions of dollars fighting it, and imprisoning millions of people for using it:

SACRAMENTO, Calif. (AP) -- The first U.S. clinical trials in more than two decades on the medical benefits of marijuana confirm pot is effective in reducing muscle spasms associated with multiple sclerosis and pain caused by certain neurological injuries or illnesses, according to a report issued Wednesday. 

Igor Grant, a psychiatrist who directs the Center for Medicinal Cannabis Research at the University of California, San Diego, said five studies funded by the state involved volunteers who were randomly given real marijuana or placebos to determine if the herb provided relief not seen from traditional medicines.

Then there's this, from the Chicago Tribune last year:

U.S. Rep. Mark Kirk will call for legislation Monday that would toughen drug-trafficking laws regarding a highly potent form of marijuana, with penalties of up to 25 years in prison for a first-time offense.

And this:

Twenty-five-year-old Weldon Angelos celebrated Christmas in federal prison this year ... just like he'll do every year until he's 80. Last month, Angelos was sentenced to 55 years in prison for selling marijuana to undercover police officers. As U.S. District Judge Paul Cassell pointed out at sentencing, that's more time than he would have received if he had hijacked an airplane (25 years), beaten someone to death in a fight (13 years), or raped a 10-year-old child (11 years). In fact, the maximum sentence for all those crimes combined is less than the federal mandatory minimum sentence for a drug felony involving a gun. (Angelos was carrying a gun at the time of his arrest, although he never brandished it or threatened anyone.) 

The assistant U.S. attorney prosecuting the case justified putting Angelos -- a first-time offender and father of two -- behind bars for 55 years by saying that he was a "purveyor of poison" who got what he deserved. (The "poison" was marijuana, which has never killed anyone.)

And this:

Over $19 billion was spent on the war on drugs by the federal government in 2003, according to the Office of National Drug Control Policy. This equates to $600 per second. Of this money, 61% went to criminal justice, and 30% went for treatment and prevention programs ("What Does The Drug War Cost?" New Times, June 24, 1999). Another $30 billion was spent by state and local governments.

According to the Schaffer Library of Drug Policy, it costs approximately $450,000 to put a single drug dealer in jail. This cost includes the costs of arrest, conviction, room, and board.

And this:

Annual Causes of Death in the United States

Tobacco	435,0001
Poor Diet and Physical Inactivity	365,0001
Alcohol	85,000 1
Microbial Agents	75,0001
Toxic Agents	55,0001
Motor Vehicle Crashes	26,3471
Adverse Reactions to Prescription Drugs	32,0002
Suicide	30,6223
Incidents Involving Firearms	29,0001
Homicide	20,3084
Sexual Behaviors	20,0001
All Illicit Drug Use, Direct and Indirect	17,0001, 5
Non-Steroidal Anti-Inflammatory Drugs Such As Aspirin	7,6006
Marijuana (!!!!!!!)	07

And then of course, this:

Nearly 45,000 annual deaths are associated with lack of health insurance, according to a new study published online today by the American Journal of Public Health. That figure is about two and a half times higher than an estimate from the Institute of Medicine (IOM) in 2002.

Now, try to make sense of any of that.

Links

• Tom Engelhardt on the American Culture of Fear and why we should, well, fear it.

• Here's a woman who is pleading for a commutation of a 27 (!!!) year sentence for a non-violent, first-time drug offense, 17 years of which she has already served. This woman has served more time than all of the rich bankers who ripped us all off have served put together. For a non-violent drug crime. Ad her first offense. Heartbreaking stuff.

• Here's a rather frightening story about some rightwing Christian fundamentalists in Texas who are influencing the content of public school textbooks all over the country.

• The lines between the media and public officials are being blurred even further. As usual, Fox "News" has no shame.

• And lest you think that it's all doom and gloom here at the Guerilla Post, here's a hopeful story about the use of algae as a cheap, carbon neutral use of fuel. All you libertarians out there might want to notice that this breakthrough was made possible by the US government.

Yves Smith Has A New Book...

...called Econned which I haven't had a chance to read yet. But I do have a great excerpt from it, which makes me really want to read it:

In 1776, Adam Smith published The Wealth of Nations. In it, he argued that the uncoordinated actions of large numbers of individuals, each acting out of self-interest, sometimes produced, as if by “an invisible hand,” results that were beneficial to broader society. Smith also pointed out that self-interested actions frequently led to injustice or even ruin. He fiercely criticized both how employers colluded with each other to keep wages low, as well as the “savage injustice” that European mercantilist interests had “commit[ted] with impunity” in colonies in Asia and the Americas.

Smith’s ideas were cherry-picked and turned into a simplistic ideology* that now dominates university economics departments. This theory proclaims that the “invisible hand” ensures that economic self-interest will always lead to the best outcomes imaginable. It follows that any restrictions on the profit-seeking activities of individuals and corporations interfere with this invisible hand, and therefore are “inefficient” and nonsensical.

According to this line of thinking, individuals have perfect knowledge both of what they want and of everything happening in the world at large, and so they pass their lives making intelligent decisions. Prices may change in ways that appear random, but this randomness follows predictable, unchanging rules and is never violently chaotic. It is therefore possible for corporations to use clever techniques and systems to reduce or even eliminate the risks associated with their business. The result is a stable, productive economy that represents the apex of civilization.

This heartwarming picture airbrushes out nearly all of the real business world. Yet uncritical allegiance to these precepts over the last thirty years has produced a world in which corporations, especially in finance, are far less restricted in their pursuit of profit. We show in this book how this lawless environment has led the financial services industry to pursue its own unenlightened self-interest. The industry has become systematically predatory. Employees of industry firms have not confined their predation to outsiders; their efforts to loot their own firms nearly destroyed the industry and the entire global economy. Similarly destructive behavior by other players, often viewed through a distorted lens that saw all unconstrained commercial behavior as virtuous, added more fuel to the conflagration.

Yves runs a little blog called Naked Capitalism, which is one of the best sources out there for the skinny on what's really happening with our economy. And Yves is one of the most tireless and prolific bloggers out there; I don't know when she sleeps.

*Simplistic ideology is, of course, exactly what uninformed newcomers to the political arena need, especially ones who are outraged at the effects of a complex system (the financial system or health care systems, for example) which they don't understand. More on that here.

Tea Party Dynamics

This is the kind of person who is drawn to the Tea Party:

SANDPOINT, Idaho — Pam Stout has not always lived in fear of her government. She remembers her years working in federal housing programs, watching government lift struggling families with job training and education. She beams at the memory of helping a Vietnamese woman get into junior college.

But all that was before the Great Recession and the bank bailouts, before Barack Obama took the White House by promising sweeping change on multiple fronts, before her son lost his job and his house. Mrs. Stout said she awoke to see Washington as a threat, a place where crisis is manipulated — even manufactured — by both parties to grab power.

She was happily retired, and had never been active politically. But last April, she went to her first Tea Party rally, then to a meeting of the Sandpoint Tea Party Patriots. She did not know a soul, yet when they began electing board members, she stood up, swallowed hard, and nominated herself for president. “I was like, ‘Did I really just do that?’ ” she recalled.

Then she went even further.

Worried about hyperinflation, social unrest or even martial law, she and her Tea Party members joined a coalition, Friends for Liberty, that includes representatives from Glenn Beck’s 9/12 Project, the John Birch Society, and Oath Keepers, a new player in a resurgent militia movement.

I guess this is kind of predictable, and it certainly makes sense. 

The last ten years have been horrible for our country, and especially the last 2 years as the fallout from the Bush administrations systemic destruction of America has really manifested itself. 

Suddenly, people who previously had no interest in (or knowledge of) economics, or public policy, or anything to do with the direction in which our nation is moving are becoming concerned. 

And because they know nothing about any of this, they look for easy explanations. And when they see something that is simplistic enough to make sense to them (regulation is bad for the economy!), they latch onto it with fanaticism of the recently converted. 

For example, most of these people aren't racist, but since they don't really know what racial code words are, they don't notice when they are used by the right nut cases who sound more and more like undercover Nazis every day.

And so you end up with this woman, who is probably a very nice person with great intentions, but who has never shown any interest in politics or public policy and therefore knows diddly-squat about anything, is suddenly elected President of the Sand Point Tea Party Patriots.

Now, I'm not saying that people shouldn't get involved. They should. People should be angry. But misdirected, uninformed rage is dangerous. And these people nothing if not misdirected and uninformed.

On the bright side, perhaps they will come to realize that there is always more to an issue than the first thing you learn. Perhaps they become more informed and still remain politically involved.

Perhaps this long national nightmare has prompted the citizenry to take that first and most important step, which is to wake up. Hopefully, now that they have, they'll start looking around them and seeing that racists like this guy are not the kind of people they want to hang around with:

Perhaps I'm dreaming.

Apparently, Senator Tim Johnson Has A Fiduciary Duty To...The Insurance Lobby.

You might think that stock brokers are required to act in your best interest. You would be wrong.

While most of the debate about financial overhaul legislation has focused on the impact on how big banks do business, one piece that would affect consumers directly has received little public notice: a requirement that stock and insurance brokers act in their customers’ best interest.

And that provision may not make it into the final overhaul plan.

At issue is whether brokers should be required to put their clients’ interest first — what is known as fiduciary duty. The professionals known as investment advisers already hold to that standard. But brokers at firms like Merrill Lynchand Morgan Stanley Smith Barney, or those who sell variable annuities, are often held to a lesser standard, one that requires them only to steer their clients to investments that are considered “suitable.” Those investments may be lucrative for the broker at the clients’ expense.

Interestingly, the group that is fighting this the hardest is the insurance industry, because they rely on brokers who give bad advice. And no one represents the industry better than Senator Tim Johnson of South Dakota:

In addition, Senator Tim Johnson, Democrat of South Dakota, is considering whether to recommend a study of the brokerage and adviser industries, a move that consumer advocates say would wipe out the proposed requirement.

“The intent of this amendment is not to improve investor protections, but to delay and deflect meaningful reform,” said Barbara Roper, director for investor protection at the Consumer Federation of America.

More on Citizens United and Corporate Speech

Lawrence Lessig has an interesting piece up at the Huffington Post in which he disagree with the minority view among progressives that free speech may not be regulated in any way, and that the Citizens United case was, in fact, properly decided:

...In an opinion by Chief Justice Robert's former boss, Chief Justice Rehnquist, in the case of Rust v. Sullivan, the Court found no First Amendment problem at all with the government's restriction on doctors' speech. Indeed, it wasn't even a difficult case according to the Court ("no question but that the statutory prohibition contained in § 1008 is constitutional.")

Why? How? Well the doctors at issue worked in family planning clinics that had received at least some of their funds from the government. And in exchange for that benefit, the government was free to gag the doctors however it wished. The doctors were free of course to work in a family planning clinic not funded at all by the government (for of course, there are plenty of those) (that's a joke). But so long as the doctors take this benefit from the government, they've got to live by the rules of the government, at least so long as those rules serve some legitimate state end.

So how is this case related to Citizens United? For the law wasn't applying exclusively to entities that had received something from the government. It was applying to all corporations.

But of course, corporations do receive a gift from the government. The government limits the legal liability of investors in that corporation in exchange for their risking their capital to spur innovation and growth. That benefit is significant. And the First Amendment question is whether in granting that benefit, the state would be free to limit the political advocacy that corporations engage in.

Lessig is arguing that the Court has held in the past that the government may restrict free speech by entities which it has created or funded. And corporations are definitely state-sponsored entities.

It's an interesting point.

I think that we should begin by recognizing that what the Court has said in the past may have limited relevance; after all, in the Citizens United case, the Court overturned a century's worth of settled Constitutional law.

But let's assume that Supreme Court precedent allows currently Congress to restrict the speech of corporations, because they are in fact creatures of the state, as Lessig points out. Is this a good thing?

Consider that it is not only corporations that receive government benefits. All employees of the government do (including Congress), as does anyone who benefits from the existence of the US military (a court could easily hold that that includes all US citizens). So really, this potentially opens the door to government restriction of all speech, and that is decidedly not a good thing.

Now you can argue that the government would never claim this power, and would limit itself to corporate speech. But you could have argued ten years ago that our government would never claim the power to torture, to lock innocent people in cages for the rest of their lives without a trial, to commit war crimes, or to illegally spy on it's own citizens, to name a few things.

Constitutionally, this seems to be a sort of grey area. Currently, we would be relying on Supreme Court precedent that is predicated on what I consider faulty logic-that the government may restrict the political speech of individuals who receive some benefit from the government, whether it's funding or limited liability or (in the case of many corporations), both. And relying on this bad precedent will serve the purpose of further legitimizing a bad decision, and one which could be used to perpetrate all sorts of mischief further down the road.

So I think that if we are willing to give government the power to restrict corporate political speech, we need to do it as narrowly and specifically as possible. This means we need to do it with a constitutional amendment.

This does not mean that I'm sold on the idea. All sorts of problems arise when you start to limit speech. But it may be that it is necessary And if it is, we should not try to take the easy route, and rationalize an unconstitutional law by pointing to other unconstitutional laws which were upheld by faulty Supreme Court logic. We should address the issue head on by changing the Constitution.

The Senate Is Broken. Let's Fix It

As many of you are aware by now, in the last few years the United States Congress has evolved into an institution which now requires a supermajority to conduct any sort of business at all. This has had a disastrous effect on the nature of our governance, and it couldn't have come at a worse time.

I'm talking, of course, about the filibuster, which Republicans have used on virtually every single piece of legislation which the Democrats have proposed, with the exception of important resolutions like the one reaffirming jazz as a national treasure.

There has now been some serious talk about abolishing the filibuster rule, which can be done by a simple majority only on the first day of a session of Congress. But this is, currently, unlikely to happen. Every Republican, obviously, will vote against it. Not only does it serve their crass political interests, which put the interests of the party ahead of the national interest, but it serves their conservative ideology as well. The filibuster is the ultimate weapon in the conservative legislative arsenal; a procedure which shuts down Congress is perfect for an ideology that fights change.

And the Democrats may not get 51 votes to do it either, because, frankly, there are a lot of Blue Dog Dems out their who have been bought and paid for by the banks or the military industrial complex, or health insurance companies, (just as the Republicans have) and who love having a filibuster around, as it keeps them from having to do their job and actually vote on something.

But it's something that needs to get done. The world is changing rapidly around us, and we've learned a lot in the last few years. Now is the time to change some of our laws to reflect that knowledge, but we can't do it because we have a Senate that no longer functions.

Let's change this. It's time to call or email your Senator and tell them to "End the Filibuster." Three words. You can find your Senator's info right here. Do it! Do it now!Share this with someone else who will do it!

Let's get our Congress back to work, so we can get our nation back to work.

A Few Thoughts On Russell Kirk

My recent post on conservatives and their fear-based politics drew a response from a commenter who took exception to my characterization, although it seems clear to me that he or she is not really a conservative in any meaningful sense of the word, although, as I make clear below, I do not think that that conservatism is actually a meaningful description at all. (If Stalin and Goldwater can both be considered conservative- and they can- then I doubt the term is very useful.) The commenter directed me to conservative icon Russell Kirk's Ten Conservative Principles and asked for my thoughts. So I've excepted a few quotes, along with my thoughts. (I encourage you to read the whole thing, if for no other reason than to ensure I'm not cherry-picking).

In essence, the conservative person is simply one who finds the permanent things more pleasing than Chaos and Old Night. (Yet conservatives know, with Burke, that healthy “change is the means of our preservation.”) 

One could paraphrase this by saying that conservativism is an ideology whose adherents oppose change, unless it's change they want. I cannot think of a more meaningless statement.

"Conservatives are champions of custom, convention, and continuity because they prefer the devil they know to the devil they don’t know." 

This is a stunning lack of imagination. No doubt this preference has been used to justify the continuation of things like slavery, debtor's prisons, the denial of universal suffrage, Jim Crow, and so forth. Currently it is being used to rationalize an insanely unjust war on drugs.

This ideology, furthermore, is used as an excuse to perpetuate the status quo. If you believe in an American aristocracy, than this is the ideology for you. Of course, conservatism, while sold as a cultural or moral philosophy, is actually based on the perpetuation of power.

"Order and justice and freedom, they believe, are the artificial products of a long social experience, the result of centuries of trial and reflection and sacrifice. " 

Therefore, no matter how unjust and immoral our society has become, we will not change it. Notice the inherent contradiction: Our fantastic society was only achieved by centuries of trying new things, and thinking hard about what can and should be done, and then making sacrifices to achieve these goals. Therefore, we should stop trying new things, stop thinking, and become afraid of the sacrifices which change requires.

"Thus the body social is a kind of spiritual corporation, comparable to the church; it may even be called a community of souls. Human society is no machine, to be treated mechanically. The continuity, the life-blood, of a society must not be interrupted." 

This is a stretch, and a non-sequitur to boot- not so much an argument based on fact as a collection of emotionally appealing words designed to convince people that change is bad.

"Conservatives argue that we are unlikely, we moderns, to make any brave new discoveries in morals or politics or taste." 

I'm sure this was a popular argument back when slavery was still legal.

"The individual is foolish, but the species is wise, Burke declared." 

This is an appeal to authority. And Burke is not an authority.

"In politics we do well to abide by precedent and precept and even prejudice, for the great mysterious incorporation of the human race has acquired a prescriptive wisdom far greater than any man’s petty private rationality." 

This is more of the same self-fulfilling nonsense. I realize that the prejudice he is referring to is of a more general kind, but this justifies racial prejudice as well. There is no doubt that at times humans are forced to resort to prejudicial action in the absence of other means of making decisions, but this should be as a last resort, and we should never use it as an excuse to stop acquiring wisdom and greater understanding.

"Fourth, conservatives are guided by their principle of prudence. Burke agrees with Plato that in the statesman, prudence is chief among virtues." 

Again, Kirk posits this appeal to authority as fact. But why not justice, or courage, or hope, or love or charity?

"Human society being complex, remedies cannot be simple if they are to be efficacious." 

I couldn't agree more, and yet it flies in the face of conservative/free-market ideology. The real world consequences of which have been shown in graphic detail over the last two years. The abject failure of the free market is apparent to all, yet the conservative response is that either 

A) although human society is too complex to fathom, we nonetheless believe that there is one economic theory that can describe the way it works

or

B) It's too hard, just let them do whatever they want.

"The conservative declares that he acts only after sufficient reflection, having weighed the consequences." 

The liberal says this too. This is meaningless.

They feel affection for the proliferating intricacy of long-established social institutions and modes of life, as distinguished from the narrowing uniformity and deadening egalitarianism of radical systems. 

I have no doubt that if you came from a wealthy Connecticut family, whose wealth has been accumulated over the centuries, often at the expense of others, and your position in the social elite was firmly set, that you, too, would have an affection for keeping things they way they are. And I'm sure that losing your exalted status in the meritocracy aristocracy would seem rather deadening.

But to me, it seems rather self serving.

"For the preservation of a healthy diversity in any civilization, there must survive orders and classes, differences in material condition, and many sorts of inequality." 

This "diversity" will no doubt continue to exist in some form, because it's impossible to eradicate. But that does not make it desirable. This "principle" is nothing more than a way for people to justify looking the other way, and ignoring Christianity's most important social directive, to love your neighbor as yourself.

Is there any level of political and material inequity that is unacceptable? I do not ask this rhetorically. Would conservatives find it acceptable if ten people on earth held 99% of the political power and wealth? If not, then where is the line? And who decides what it is? Please explain.

"The only true forms of equality are equality at the Last Judgment and equality before a just court of law; all other attempts at leveling must lead, at best, to social stagnation." 

Equality at the last judgement in no way precludes a desire for equality here on earth. And what is a "just" court of law? Here's the disconcerting answer: there is no such thing. Even the most impartial judge is bound by laws written by man; these laws are always written by those in power; in other words, by those with a prevailing interest in the status quo. So unless you define justice as "whatever those in power want", you're not finding just courts of law around here.

"Society requires honest and able leadership; and if natural and institutional differences are destroyed, presently some tyrant or host of squalid oligarchs will create new forms of inequality." 

So-we can never change. A prefect rationale for keeping Fidel Castro in office.

Sixth, conservatives are chastened by their principle of imperfectability. Human nature suffers irremediably from certain grave faults, the conservatives know. Man being imperfect, no perfect social order ever can be created. 

So let's just give up. Besides, giving up works out really well for those of us in power. I can imagine this on an ancient Egyptian campaign poster. Or maybe not, since democracy is a liberal idea and hadn't been invented then.

"All that we reasonably can expect is a tolerably ordered, just, and free society, in which some evils, maladjustments, and suffering will continue to lurk." 

Yes, we know that this terribly inequitable system is flawed, and that evils and suffering will continue. But it won't feel so bad if you just accept it. Ah, the tyranny of lowered expectations.

"The ideologues who promise the perfection of man and society have converted a great part of the twentieth-century world into a terrestrial hell." 

True enough, but consider

A) No one is contemplating a return to totalitarian communism, which is antithetical towards liberalism (but perfectly compatible with conservatism)

B) If I point out that communism was never intended to veer towards totalitarianism, you will rightly respond that those consequences should have been foreseen. But the same could be said for conservatism's neo-con transformation, which has resulted in similar excesses.

C) The entire trajectory of human history has been non-conservative by definition. Sure, communism was a bad experiment. But if we never tried anything, we would still be living under global rule by Pharaoh.

"Upon the foundation of private property, great civilizations are built." 

Ok, so let's debate what private property is. Liberals would say that since society is instrumental in the creation of wealth it should have some claim on it. Conservatives either (wrongly) say that they alone are responsible for everything they have, or (naturally) say "F--k you, I got mine."

"The more widespread is the possession of private property, the more stable and productive is a commonwealth. Economic leveling, conservatives maintain, is not economic progress." 

These are two contradictory statements. On the one hand, the more widespread is the possession of property, the more stable and productive the economy. One the other hand, making the possession of property more widespread is not good for the economy. Seriously, did Kirk have an editor?

"Whatever is beneficent and prudent in modern democracy is made possible through cooperative volition. " 

This is simply not true. And you know it's not true. Let's talk about some things I would consider beneficent and prudent in a modern democracy, that are simply not going to exist through "cooperative volition."

• Sewer systems 
• Military 
• Public health 
• Fire departments 
• Police 

I could go on, but I really only need one exception.

This is not to say that I don't think things shouldn't be done as locally as possible in many circumstances. I do. But this is not some hard and fast rule. Each situation is different. It requires us to think, and to use our imaginations. These, of course, are not conservative traits, so maybe this is why Kirk favors making rules and sticking with them, even when they fly in the face of all available evidence.

"Ninth, the conservative perceives the need for prudent restraints upon power and upon human passions." 

So do I, as a liberal.

"A state in which an individual or a small group are able to dominate the wills of their fellows without check is a despotism, whether it is called monarchical or aristocratic or democratic." 

Just to be clear, conservatism leads naturally to an aristocracy.

"In every age, nevertheless, men and women are tempted to overthrow the limitations upon power, for the sake of some fancied temporary advantage." 

The Founding Fathers come to mind. Surely Kirk will think of this.

" In the name of liberty, the French and Russian revolutionaries abolished the old restraints upon power; but power cannot be abolished; it always finds its way into someone’s hands." 

But no. He conveniently forget that most liberal of experiments, the founding of America, and focusses on two experiments that failed to varying degrees.

Knowing human nature for a mixture of good and evil, the conservative does not put his trust in mere benevolence. Constitutional restrictions, political checks and balances, adequate enforcement of the laws, the old intricate web of restraints upon will and appetite—these the conservative approves as instruments of freedom and order. 

And these things would have never existed if not for radicals like our founding fathers, or the long history of Western experimentation with radical, liberal concepts like democracy.

"Tenth, the thinking conservative understands that permanence and change must be recognized and reconciled in a vigorous society." 

So forget everything up to now. Change is good.

"The conservative, in short, favors reasoned and temperate progress; he is opposed to the cult of Progress, whose votaries believe that everything new necessarily is superior to everything old." 

So progressivism is good, as long as you don't believe in change just for change's sake.

Well, I don't.

I have a long list of changes that I would like to see, and they are because I would like to make our society better. They are not because I am bored.

As an philosophy, conservatism is nonsense. It requires you to believe either that

A) at all times in human history, things were as good as they would ever be.

or

B) things were never as good as they are right now, at this very instant, and they will never be better.

In other words, conservatism has been and always will be wrong, but, nevertheless, at this precise moment, it is right.

Or, if not that, then Kirk's philosophy is " I really like the way things are. I don't want to change anything. Of course some people do want change, because they don't like the way things are. In order to pacify them, I will say that change is ok, as long as it's good change. And good change is any change that I approve of."

I don't see a philosophy here.

Doing The Lord's Work!

Goldman seems to be involved in pretty much everything that goes wrong these days:

As worries over Greece rattle world markets, records and interviews show that with Wall Street’s help, the nation engaged in a decade-long effort to skirt European debt limits. One deal created by Goldman Sachs helped obscure billions in debt from the budget overseers in Brussels.

Even as the crisis was nearing the flashpoint, banks were searching for ways to help Greece forestall the day of reckoning. In early November — three months before Athens became the epicenter of global financial anxiety — a team from Goldman Sachs arrived in the ancient city with a very modern proposition for a government struggling to pay its bills, according to two people who were briefed on the meeting.

The bankers, led by Goldman’s president, Gary D. Cohn, held out a financing instrument that would have pushed debt from Greece’s health care system far into the future, much as when strapped homeowners take out second mortgages to pay off their credit cards.

It had worked before. In 2001, just after Greece was admitted to Europe’s monetary union, Goldman helped the government quietly borrow billions, people familiar with the transaction said. That deal, hidden from public view because it was treated as a currency trade rather than a loan, helped Athens to meet Europe’s deficit rules while continuing to spend beyond its means.

Greece is now in danger of defaulting on its debt, a move which could precipitate a crisis in the Euro, and which could easily spread across Europe, and eventually cause massive defaults and losses to US banks- banks that are undercapitalized and already facing the prospect of horrendous losses in commercial real estate in massive residential foreclosures. 

What Goldman did here, basically, was help Greece act in bad faith to get around rules which were designed to keep them from getting into exactly the kind of trouble that Goldman helped them get into; now, the rest of Europe has the choice of either bailing them out, or risking another financial crisis. 

Apparently, nearly destroying the global economy once isn't enough for these guys. "Doing the Lord's Work" obviously requires much more mayhem then that. And maybe this time they'll succeed.

Fearing Fear Itself

Nicholas Kristof is talking about how conservatives and liberals may be hard-wired differently:

We all know that liberals and conservatives are far apart on health care. But in the way their brains work? Even in automatic reflexes, like blinking? Or the way their glands secrete moisture?

That’s the suggestion of some recent research. It hints that the roots of political judgments may lie partly in fundamental personality types and even in the hard-wiring of our brains.

Researchers have found, for example, that some humans are particularly alert to threats, particularly primed to feel vulnerable and perceive danger. Those people are more likely to be conservatives.

One experiment used electrodes to measure the startle blink reflex, the way we flinch and blink when startled by a possible danger. A flash of noise was unexpectedly broadcast into the research subjects’ earphones, and the response was measured.

The researchers, led by Kevin B. Smith of the University of Nebraska-Lincoln, found that those who had a stronger blink reflex at the noise were more likely to take such conservative positions as favoring gun rights, supporting warrantless searches, and opposing foreign aid.

That makes intuitive sense: If you are more acutely sensitive to risks and more fearful of attack, you also may be more aggressive in arming yourself and more wary of foreigners.

It also would explain the conservative response to terrorism-namely, abject fear and cowardice, which is manifested in its willingness to sacrifice the Constitution, the rule of law, and the ideals of America in exchange for the mirage of security.

It would explain why they are too afraid to hold a public trial of accused terrorist Khalid Shiekh Mohammed, and insist that he is some sort of scary superhuman who will break out of his cell and kill us all in our beds. Or something.

It would explain why they are so afraid of the terrorist bogeyman that they are willing to soil the reputation of the United States by demanding the torture of even innocent people, on the off chance that they might know something about something.

It would explain why right wing politicians and pundits, almost without exception, decline to join the military (even though they are of prime military age), choosing instead to demand that others fight and die in the wars they constantly agitate for.

It would explain why they are so afraid of change that they believe that Obama, a centrist if there ever was one, is preparing to turn the country into a giant Gulag, and why they would prefer that the U.S. return to the nice, quiet, un-scary 19th century.

It would explain why they are so paranoid that they insist the government be given the power to spy, without warrants or even the pretense of probable cause, on the phone and email communications of its own citizens.

It would explain the irrational fear conservatives have of anyone with different colored skin, or with different sexual preferences, or different accents, or pretty much anybody that doesn't look, talk, think, or belong to the same religion as them.

It would explain the irrational fear of drugs, when in reality, they know nothing about drugs.

Obviously, this is painting with a wide brush. I realize that there are many conservatives out there who haven't really thought through their positions, and if they took the time to do so, would realize that they are wrong, and would not be afraid to admit it.

But there are are a lot more who realize that they are trashing the Constitution, and the rule of law, and are supporting truly evil things like the invasions of helpless countries, and torture, and endless warfare, etc, but who just don't care because they are so scared they can't help themselves.

These people won't help reform a broken health care system because they are scared that the country will turn into Stalinist Russia if they do.

They fight tooth and nail against reforming our insane drug laws, because they are frightened that zombie potheads will be roaming the land, feasting on the bodies of the weak and old that they rape and kill.

They are so terrified of criminals, particularly of black criminals, that they scream out for executions; the chance that someone could escape from a life sentence in prison is just too frightening for them contemplate.

 

They are so scared that the Banking Masters of the Universe will intentionally crash the system, that they refuse to take the necessary steps to reform and save it.

They are so scared of gays in the military, a military that they would never join themselves, that they insist on kicking vitally important soldiers out of the service because gays make them sexually insecure.

I could go on all day. It certainly explains why right wingers are so eager to call liberals soft, even though many liberals (JFK, George McGovern, John Kerry) are genuine war heroes, while so many conservative heroes (Reagan, Bush II, and just about every single neo-con out there) has avoided military service. Projecting your own cowardice on others probably makes you feel better for a few minutes. 

The supreme irony is that in many cases, their reactions to these imagined threats threats makes them less secure in the long run.

I guess there isn't much that can be done to change the way these people think. Frightened, irrational people are always dangerous and prone to panic, and we will have to learn to live with them. And it might also help us to understand them, because they are our families and neighbors and coworkers and friends, and they deserve our support. 

But it would certainly help if the rest of us realized that the manifestations of fear listed above are simply the irrational reactions of a small but loudly shrieking group of truly frightened people.

At least this might keep us from following them down the rabbit hole.

Fun With Polls

There's a new CBS/NYT poll out today, and there are some interesting numbers. Here are a few questions:

4. What do you think is the most important problem facing the country today?

• Health Care 13%
• Economy 25%
• Jobs 27%
• War 3%
• Deficit 4%

Sad, but true. One of the biggest reasons we have a cratering economy and massive job losses is because we are constantly fighting needless and insanely expensive wars. And yet only 3% of Americans believe this is the most important issue facing our country. 

On the bright side, only 4% think the deficit is the biggest problem, which is surprisingly low given how the bondholder interests have been trying to scare everyone to death with deficit horror stories.

12. Do you think most members of Congress have done a good enough job to deserve re- election, or do you think it's time to give new people a chance?

• Deserve Re-election: 8%
• Time for new people: 81%

Far be it from me to defend Congress, but let me make two points. First, there are a good number of excellent congressmen who are committed to serving the public good (Alan Grayson and Bernie Sanders spring to mind.) They aren't all bad. But all of the Republicans are terrible (yes, every single one!), and a good number of Democrats are pretty worthless as well. 

Secondly, the new people will be just as bad. The problem isn't just the congressmen, per se. The ones we need to get rid of are pretty much just empty suits anyway, whose votes are bought by corporations or some other special interest whose interest isn't the public good. 

Also, 81% of Americans think that we need a new Congress, and yet around 90% of congressmen will be reelected. Go figure.

26. How much of the time do you think you can trust the government in Washington to do what is right -- just about always, most of the time, or only some of the time? 

• Some of the Time     74% 
• Most of the Time      16%
• Always                      3%
• Never                         7%

These answers are right at the intersection of sadness and reality. Since people had a choice of answering "most of the time", one has to assume that "some of the time" is somewhere between say, two thirds and zero. Does this mean that 74% of people think the government will do the right thing about 1/3 of the time? They're probably right.*

The 7% who answered "never" obviously haven't heard of the broken clock theory. But what is absolutely shocking is that 3% of people believe that Washington does the right thing every single time. Who are those people? And are they hiring?

30. Would you say the government is pretty much run by a few big interests looking out for themselves, or that it is run for the benefit of all the people? 

• Few big interests 78%
• All people           18%

I guess no one really believes in "government of, for, and by the people" anymore, do they?

*This doesn't mean that government can't do anything right. It means that government won't do anything right. There is a big difference. Overall, the bureaucracies that everyone loves to hate do a pretty good job with the resources they have. Our government agenncies are relatively competent. It's the political part of our government that is completely dysfunctional.

Moral Hazard Made Easy

Baseline Scenario has their latest, well, "Baseline Scenario" here. I found a couple of points illuminating:

10) Good times will bring surplus savings in many emerging markets. But rather than intermediating their own savings internally through fragmented financial systems, we’ll see a large flow of capital out of those countries, as the state entities and private entrepreneurs making money choose to hold their funds somewhere safe – that is, in major international banks that are implicitly backed by U.S. and European taxpayers. 

11) These banks will in turn facilitate the flow of capital back into emerging markets –because they have the best perceived investment opportunities – as some combination of loans, private equity, financing provided to multinational firms expanding into these markets, and many other portfolio inflows. Citigroup, for example, is already emphasizing its growth strategy for India and China.

In layman's terms, emerging markets (which include countries like China, India, and Brazil) will continue to grow, and their growth will mean that they will have excess capital. These countries can't just stuff this cash under a mattress, so they have to put it somewhere.
But the banks in those countries are not exactly reliable. Or at least not as reliable as big American and European banks.
Why is this? Because the big banks in America and Europe are now guaranteed by you and me, the taxpayers.
So what will these big Western banks do with all that money?
Well, they have three basic choices:
1) They can hold on to it, and use it shore up there weak balance sheets, to ensure that, if there is another crisis (as many economists expect), they won't collapse.  or...

2) They can direct it towards less risky ventures, including things right here in the US.

They won't choose either of these two options, because shoring up balance sheets or investing in less risky ventures-while good for the banks and the financial system in the long run-doesn't pay very much. And the executives in charge of these big banks get paid a lot more when the banks make big profits. And since you and me (taxpayers) are going to bail them out anyway, there is no reason for them to try to avoid blowing up. After all, these banks were saved from blowing up by the taxpayer a year or so ago and their executives are making more bonus money then ever. So there is clearly no reason to worry about that.

3) They can direct it towards extremely risky ventures somewhere in an emerging market like China or India.

This, of course, is the option they will choose. Emerging markets are very risky. If you loan money to people in these markets, there is a good chance you'll never see it again. That's why banks can charge high interest rates on these loans. Banks that collect high interest rates make big profits, which equal big bonuses. And if the loans go bad, and the banks get in trouble, well that doesn't matter either, because the taxpayers will just bail them out again.

It's sort of like if you told your friend he could lend as much money as he wanted to the drunk guy on the corner, and that he could charge as much as he wanted for interest, and that you'd cover him if the drunk guy didn't pay up.

Don't you think that you'd want to charge your friend for this guarantee? Of course you would. (Actually, you wouldn't want to do this even if you were charging him for it; but if you had to do it, you'd be damn sure you charged for it.)

So how much do you think taxpayers should be charging big banks for their guarantee?

You might be surprised to learn that we aren't charging them anything. And the value of that guarantee is immense. It's yet another form of bank bailout, in addition to TARP and trillion dollar guarantees and bailouts of counterparties and interest-free government loans. And all of this will lead to Baseline's 22nd and final point:

22) We are steadily becoming more vulnerable to economic disaster on an epic scale.

You aint seen nuthin' yet.

Foster Friess Joins The Fray

This is from a critique I was asked to give on the Health Care Stakeholders Plan that Foster Friess has put together.

As you will see, I disagree with Mr. Friess on validity of some of his proposals, but I do want to highlight the fact that he has put his money where his mouth is by donating large amounts of money to help people who are truly in need, especially those who suffer from lack of access to health care. So while we may disagree to some extent on how to solve our nation's health care problems, there should be no doubt that he is sincere in his efforts to help.

This is from an email which Foster sent regarding his plan, and which he was gracious enough to allow me to reproduce here:

1. Healthcare Reform should be implemented incrementally, slowly and with time to digest the ramifications of the changes and to become aware of unintended consequences. It should not be a “one shoe fits all” approach but allow states great latitude in altering healthcare reform to the specific needs of their geographic locale.

45,000 people a year are dying from lack of health care insurance. This is an unintended consequence of needless delay, and we should be aware of that as well.
I don't believe that we are suffering from a lack of information. The rest of the industrialized world has given us plenty of examples, and there are over a dozen countries with demonstrably better health care systems than ours, some of which have been in place for over a century. The one advantage we have is that we let these other nations take the risk of experimenting with and refining these systems; we would be foolish to ignore what they've learned and to try to reinvent the wheel.
I do not believe that states differ that much in their health-care needs, although I will grant that they differ greatly in their political will.

2. The first step the Federal Government must take is changing one line in the IRS Code that disallows deductions employers make to insurance companies or health maintenance organizations, but allows them to deduct that exact same amount into each individual employee's health savings account. The tax and revenue implications, therefore, remain constant and the government, the employee and the employer are exactly in the same position they were before this one line change.

The key difference is the employee has now been empowered as a cost control center and it is portable so the employee is not locked into a job because he's uncertain about his next employer's health insurance policies. Cost to taxpayers---ZERO.

Why don't we take this one step further and disallow all deductions? Is there some reason that employers should be involved in making health insurance choices for its employees? Furthermore, ANY subsidy for employer-provided health insurance is a transfer of wealth from those who do not choose to work for a large corporation to those who do. And it subsidizes large businesses who have the economies of scale to manage health care plans at the expense of small businesses.


Obviously, removing the deduction in the absence of any true systemic reform would result in massive increases in the numbers of uninsured, and so I could not support that on its own.


Your point about employees being locked into a job is well taken, however. The conclusion I would draw from it is that employment should be divorced from health insurance entirely, as there is no logical or rational connection there at all.

3. In order to make this work the Federal Government must mandate that all suppliers of medical/healthcare services must post prices and outcomes. Taxpayer cost- ZERO.

I wish that standardized pricing was possible. However, given the fact that the United States currently has four completely different methods of allocating health care (government-owned, single payer, private health insurance, and out of pocket), each with its own associated costs and pricing structure, this is currently impossible. Hopefully, we can work together to create a less complex system in which price transparency is possible.


Outcomes are similarly difficult to quantify, but a universal health care system, with a single method of reporting outcomes would make what is undoubtedly valuable information much easier to obtain.

4. Because insurance companies do not want to deal with the gazillion health savings accounts that would be spawned across the nation, the Federal Government must remove any impediments to more robust aggregating so any individual can join a pool of his choice...his Rotary club, his church, former employees of United Widget, Taxi Cab Drivers of America, or the pool of his choice. Tax payer cost –ZERO.

Because I do not think that HSA's are the answer to our problem, I will only note that any system which requires patients to perform cost/benefit analyses on their health care choices (which they are manifestly unqualified to do) will inevitably lead to a less than optimal amount of preventative care, which will lead to inefficiencies in treatment and higher systemic costs. Keep in mind that higher systemic costs affect everybody, not just the people who make poor decisions.


I would like to take this opportunity to say that I understand that it is important for people to have skin in the game, and for minor health care issues, or things like cosmetic surgery or truly elective procedures, they make perfect sense. The difficulty is in determining which procedures are minor or elective. Who should make this decision? And does the economic benefit of this "skin in the game" warrant creating a new and complex system of HSA's, which many people will not understand or take advantage of?


Furthermore, the "zero cost to taxpayer" attributed to HSA's ignores the externalities. HSA's will result in healthy individuals canceling their insurance policies, which will leave the insurance pools with more sick people, resulting in a feedback loop where the healthiest people continue to drop out of the pools, and only the sick remain, until no one can afford insurance at all. Now this may be a feature of HSA's, rather than a bug, but simply forcing everyone into HSA's leaves us with another problem: What do we do when these people don't have enough money to pay for health care? If we let them die, then it's a political nonstarter (as it should be.) If we help them out anyway, then there is no incentive for people to put money in their HSA's.

5. The Federal Government must require that each state have two offerings of "mandate light" insurance policies so that we return our culture back to one of "insurance" rather than "prepaid health care." One "mandate" that would be in it is that a base physical exam followed with additional ones at appropriate intervals without going against the deductible. High deductibles would be encouraged in order to make the plan work. Taxpayer cost ZERO.

"Mandate-light" policies, coupled with for profit insurance companies, will ensure that customers continue to get policies that will be virtually worthless.
And of course, when people buy worthless policies, it costs the federal government (taxpayers) more because many of people will end up on Medicaid after declaring bankruptcy.

6. From this point forward the states are unleashed to experiment with how they want to deal with preexisting conditions, the safety net for expensive healthcare costs, tort reform, medical records and all the other issues. The creativity that exists in each state exceeds that of Congress.

These experiments have already been run. They've been run by all of the world's other advanced nations. We don't need more information on how to do these things. At the top of this page you said:


"Healthcare Reform should be implemented incrementally, slowly and with time to digest the ramifications of the changes and to become aware of unintended consequences.


and yet this proposal is to radically alter our system by replacing it, not with one of the other systems that have been demonstrated to work far better than ours, but with a system (HSA's) that most health care economists say will not work. I believe these two ideas are contradictory.


Also, health care policy is a de facto and a de jure federal responsibility. Determining the efficacy of dozens of competing state plans will be impossible, if for no other reason than sick people will be permitted to leave one state for another with better benefits. Taken to the extreme, this would result in the state with the best benefits having all the sick people. Obviously, this effect would be greatly mitigated by the fact that people won't move unless things become really serious, but the point stands.


Now, on to the things that I can agree with you on! (And please correct me if I am incorrectly characterizing your positions.)


I can agree that the Senate health reform bill, as currently written, is unacceptable. And I will enthusiastically join you in advocating against it.


I can agree that tort reform is necessary. I realize that studies have shown that tort reform will not save much money, but this primarily because most potential malpractice suits are never filed! This means that the tort system is not very equitable, and if we were to make it more equitable, it would be prohibitively expensive. The dirty little secret of medical malpractice is that resolving cases in the judicial system is terribly inefficient, and usual very inequitable (a small percentage of the injured receive the vast majority of the money.) These cases would be better off resolved by a committee.


However, in a free-market system such as the one we think we have, malpractice lawsuits are basically a patient's only recourse. So I would not support tort "reform" without a reform of the entire system. A single payer system in which punitive awards were prohibited entirely would be acceptable, for example.


I can agree that more transparency is better. However, as I noted above, reducing complexity is the single most important thing we can do to improve transparency. Single payer would do more to reduce transparency than any other thing we could do.


I agree that the people making the decisions should have skin in the game. At the moment, the people making the decisions are often insurance companies, and they have no skin in the game, in the sense that they have no interest in your long term health, because they will just drop your coverage if you get too sick (read: expensive) for them. Single payer, or even government-run health care systems, have an interest in keeping you healthy for your entire life, since they don't have the option of dropping your coverage. (This also results in a far greater focus on public health initiatives, which, while not as exciting as the latest high-tech surgical procedure, often have a much larger impact on the overall health of a population.)


With that said, here are a few basic principles which I believe are important for us to accept.


Basic, necessary health care should be a right in United States. 

This principle is generally accepted by a great majority of the public. Our policies should reflect that in a more sensible way. Requiring emergency rooms to accept anyone with a life-threatening condition is an acknowledgement of that principle. Requiring them to be dying before granting them treatment is a reflection of the failure of our country to implement this principle in a rational way.


For-Profit health insurance companies should be eliminated.

They add absolutely nothing of value to the system. They extract huge sums of money in the form of profits, bonuses, needless overhead, added complexity, and, to top it off, are not in business to provide health care, but to collect as much money as possible while providing as little health care as possible. This is, in fact, their business model. And this is the industry that Congress has inexplicably decided to bestow one of only two anti-trust exemptions upon (the other being baseball.) At a very minimum, if we decide to keep insurance companies around, they should be required to be non-profit, and should be heavily regulated. At this point, we might as just have single-payer, and eliminate the redundancy as well.


Healthy people will have to pay for sick people.

There is no way around this. It's nothing new; it's happening today. It has happened throughout history. Medicare, Medicaid, charitable organizations and hospitals, and your own praiseworthy initiatives have helped to do what the free market cannot. But this means that we're all in this together, and that we should be trying to find ways to lower systemic cost, and not to reward people for the good fortune of being born with healthy genes.


I would like to counter with another proposal. Why not just allow everyone to join Medicare? It works, it has lower overhead, it's outrageously popular, it's been proven, the infrastructure is already there, and it will immediately lower our systemic costs. Medicare has been around for decades, so it's not like we'd be rushing into anything. I realize Medicare isn't perfect, but no system is. Medicare For All, at the very least, would indisputably reduce costs and provide universal coverage. Isn't this what we really want?


We can do this now. It will save lives, and save them now. If nothing else, it would be a great way to stop the bleeding until we can take the time to work out something better, if indeed there is something better out there.

Actionable Intelligence?

Craig Murray, a former UK ambassador to Uzbekistan, tells how the CIA sent innocent people to that country, out of public sight, and tortured them until they confessed to being terrorists.

"I'm talking of people being raped with broken bottles," he said at a lecture late last month that was re-broadcast by the Real News Network. "I'm talking of people having their children tortured in front of them until they sign a confession. I'm talking of people being boiled alive. And the intelligence from these torture sessions was being received by the CIA, and was being passed on."

Why did they do this? Because the US wanted to build a natural gas pipeline from Uzbekistan through Afghanistan, and we needed to justify our presence there. And the easiest way to do that is to scare the shit out of American citizens by boiling people alive until they made up some story about Al Qaeda and Bin Laden.

America. That shining beacon on the hill.

And when Murray went public? He was dismissed from his job by the British government.

Read more here about Murray's story, and about what the War on Terror is really all about. 

More Unrest Ahead In Iran

Reza Azlan reports:

The Green Movement's leaders are calling supporters to the streets, Mahmoud Ahmadinejad is rallying his side with nuclear brinksmanship—and the clashes expected Thursday for the Islamic Republic's 31st anniversary could spell civil war.

It began last summer as a protest over a disputed presidential election. It blossomed last fall into an awe-inspiring revolt against the very nature of the regime. Now, on the eve of the 31st anniversary of the Islamic Republic, as Iran braces for what could be the largest and most violent demonstrations since the election that returned Mahmoud Ahmadinejad to power, the country may be on the brink of civil war.

I believe that the likelihood of a new revolution in Iran is often overstated. But the possibility remains fascinating. Let's all hope that this can be accomplished without outside interference, and with a minimal amount of bloodshed.

And let's all hope the Sarah Palin keeps her trap shut for once.

Banker's Roulette

Sorry for the recent light posting; I've been out on the road in the wilds of Western Wyoming with some dog sleds and a bunch of crazy dog-mushers. Things should be back to normal soon.

But while I'm here...

I read a comment about bank bailouts somewhere today in which the commenter seemed to perpetuate a a false belief among people-namely, that, as odious as the bank bailouts were, they were necessary because people had their life savings in those banks, and bailouts were necessary to make sure those banks didn't fail.

This, of course, ignores the fact that consumer deposit accounts were already insured by the FDIC to the tune of $100,000, and that the bailouts had nothing to do with that. Banks, in fact, pay insurance premiums to the FDIC for that guarantee, and are required by law to do so.

The real issue is that the federal government is now also guaranteeing the solvency of entities which may or may not be banks (AIG, of course, was not a bank), but which are involved in things that have nothing to do with what we consider to be normal retail banking. These entities, which have recently discovered that you, the taxpayer, will be required to pay for their losses, are now betting huge sums of money on extremely risky trades. Those trades often seem ok for a year or two. During that time, the banks will make lots of money, and executives will pay themselves billions of dollars in bonus. Eventually, though, the luck will run out, as it did a year and a half ago, and the banks will go bust. At this point, the taxpayer will pay off the bet, and the executives will just keep their bonuses. Oh, and guess how much they pay for that guarantee?

Nothing. Zero. Zilch.

They get it for free, because they have put a gun to the government's head by making themselves so big that if they fail, they will destroy the whole economy.

It's as if the bankers are playing Russian Roulette- only they're holding the gun to your head instead of their own. Every time they get lucky and the gun doesn't go off, they get a million bucks. You get nothing. Eventually, of course, you end up with your brains against the wall, and at the that point, the game is over. The bankers pocket the cash and go home.

Sound fair? I didn't think so.

Remember that the next time some Republican (or Democrat) talks about how important it is that we don't regulate these banks because we don't want to do anything to mess with the "free market."

How free does that sound to you?