Friday, October 18, 2013

The Grand Sell Out


Heads I win, tails you lose

By Mike Krauss
Bucks County Courier Times

Whatever may be said of the GOP members of Congress trying to kill Obamacare, one thing is certain. Someone is backing their play.

Whether it’s the promise of campaign contributions, the threat of well funded election opposition or the lure of post Congressional riches, there is a lot of money in play.

What does the money want?

Probably not what the tea partier next door wants, which is a dramatically smaller federal presence in their lives; a goal with which I suspect a lot of Americans are increasingly in sympathy.

But that is not precisely what the money wants.

The one thing you know for sure about modern American government is that it is a government of, by and for established corporate interests. In Washington, corporate profit trumps all.

Obamacare is a windfall for the insurance and pharmaceutical industries. “Big pharma” is big, and the finance industry (of which insurance is a part) is the now the biggest of all, by some reports accounting for 60 percent of U.S. domestic profits. They are not going to let Obamcare go down. And neither will the president. It is his “legacy.”

Without it, what will remain for the history ebooks will be eight years of crushing unemployment and more than five million homes foreclosed, an assault on constitutional rights, massive student debt, an Orwellian surveillance and police state and mindlessly expensive foreign military involvement.

And the health care legislation has the president’s name on it. It is not negotiable and everybody knows it.
So Obamacare is a stalking horse. What do the global corporate elite really want?

More.

Where will they get it?

Entitlements.

Not of course from the corporate entitlements: tax breaks and billions in subsidies to banks, energy, defense, agribusiness, IT and the gods of modern American business. But rather, from Social Security, Medicare, food stamps, unemployment and any spending that does not go directly to the corporate bottom line and ever more fantastic salaries for corporate CEOs and dividends for shareholders (the less than 1 percent of the American people).

President Obama put these programs on the chopping block two years ago; the idea got no traction. But corporate America has not given up, because the big prize is big. Get rid of Social Security, and the employer contribution goes away.

Well, not away, exactly. More like diverted — into CEO salaries and shareholder dividends.
And Wall Street gets to play with the $1 trillion a year which Social Security collects, every year, while they load up private retirement plans with fees and commissions, as they have already done with 401ks.

So the puppet masters who pull the strings in both parties have got the president and Congress doing this little dance of crisis — the corporate media providing the sound track — being maneuvered into position to do their deal, bow nicely and end it in a great show of democratic civility.

The American people are being set up for what passes for compromise these days: heads, the 1 percent win, tails the 99 percent lose.

There is of course another possible outcome.

The people still will not accept more austerity for the 99 percent, and the predatory puppet masters will decide they are tired of waiting and collapse the economy entirely; in which case Social Security and about everything else that supports the people and American prosperity may disappear quite suddenly and quite completely.

In either case, it is time for the American people to get ready to shuffle the deck for a Second New Deal.


Tuesday, July 9, 2013

Reining in the spies

Enemies foreign and domestic: Reining in the spies

By Mike Krauss
Bucks County Courier Times

The Declaration that went out from Philadelphia to the world in 1776 proclaimed a government of the people, and that the purpose of American government is to secure the rights of the people.

But increasingly the United States seems more a people of the government, and the only thing the present American government seems interested to secure is more power.

The first Americans understood the great danger to the rights of the people: the very government they were creating. They understood that all governments use whatever power they have. So they balanced the necessity of government by subordinating it to the will of the people and building into the government limits to its power.

And it worked pretty well, up until the Bush and Obama administrations.

Under the cover of a never ending war on a concept — terror — the control freaks (sometimes referred to as fascists) among those elected to office have done what control freaks always do — seek more control.

One by one the rights of the people and protections from government that are essential to freedom and liberty have been subverted: the due process of the law, habeas corpus, th right to peacefully assemble and protest (“petition”), the right to be confronted by accusers and see the evidence in open court — all have all been subverted.

The executive branch now uses its power to arrest without warrant and imprison indefinitely whoever it chooses. The executive asserts the right to order the execution of American citizens in secret, without judge, jury or trial.

And now we know that everything Americans communicate to another living person is recorded, stored and analyzed by the government’s National Surveillance Agency.

First we learned that all our phone calls and email are monitored. On the 4th of July it was reported that a photo is taken of every piece of mail handled by the postal system: meaning names, addresses and return addresses are noted.

The government knows more about you than your mother, father, spouse, partner or priest.

“But wait,” say the incredibly gullible, “the government will never go beyond taking note of all our private communication, will never look at my life, they’re just looking for the bad guys.”

Oh please.

A president will never want to know exactly what a political foe or potential major donor is saying to his or her friends, family, business partners or allies?

Some high ranking bureaucrat in the vast National Surveillance Agency will never be curious about what kind of valuable investment information can be had from taking a look at what the Federal Reserve Chairman is thinking, before it is announced?

Or that it will never occur to employees of the private company that collects all this data, that the company is in fact the greatest and most powerful private detection agency of all time, and go into business selling the data collected?

It is only a matter of time before all of these abuses and more occur, if they have not already.

Sadly, but not surprisingly, only a handful of members of an increasingly irrelevant Congress have raised the alarm, even after they learned that the head of this domestic spy ring lied to them about it.

The spymaster later admitted his testimony had been “erroneous.” Seems he confused the two laws that set up all the spying.

Which is like the CEO of General Motors saying he forgot the difference between the gas pedal and the brake.

So he lied to Congress or he is incompetent. Take your pick.

What can be done?

First, this national spymaster must go. Second, the entire Patriot Act needs to go, to be repealed and replaced with a law that provides the necessary tools to protect the nation, but with the limits on that power and the protection of the rights and liberties of citizens without which this nation ceases to be a democracy. Third, Congress must put an end to secret decisions made in secret courts by secret people accountable only to other secret people.

Finally, the Secret Keeper in Chief needs to remember his oath of office, to “preserve, protect and defend the Constitution of the United States against all enemies, foreign and domestic,” and reign in a domestic spy agency more vast and frightening than anything ever imagined by the Nazi Gestapo, the Soviet KGB or East German Stasi.

But will he?



Sunday, June 16, 2013

Too Big to Jail


The New Untouchables


In an earlier era, the “Untouchables” of American lore were fiercely honest federal agents who went after the gangsters of their time. Now, the Untouchables are the bankster criminals of Wall Street who the feds and the chief law enforcement officer of the nation – the attorney general of the United States – refuse to prosecute.

And the banksters are criminals. The record is clear. They have engaged in massive, systematic fraud that cost and continue to cost the American people trillions of dollars – homeowners, investors, savers, municipal governments, school districts, the now unemployed and just about anybody who uses a credit card.

The banksters have amassed personal wealth on a scale that Al Capone could never have imagined. And they use it to buy protection.

I don’t mean they hand out bags of cash to politicians and law enforcement officers. That’s so yesterday.

Rather, the banksters and the other corporate criminals of modern America sponsor the careers of politicians and the people they put in the government, and reward them richly after their government “service.”

And they get results. They get to commit crimes on a scale never before imagined, involving sums of money never before imagined and never go to jail. They are not even prosecuted.

It was not always so. Back in the S&L scandal, nearly a thousand individuals were successfully prosecuted for their crimes by the Department of Justice (DOJ). And in the Enron scandal, the Bush Justice Department went after the accounting firm Arthur Anderson for its part in the fraud and put it out of business – 28,000 people lost their jobs.

That’s tough law enforcement.

But  a relatively unknown but well respected deputy attorney general in the Clinton administration thought that was too tough and proposed a new policy:  before companies were prosecuted for their crimes, prosecutors should consider the “collateral damage” of a successful prosecution – like the 28,000 people who lost their jobs over the misdeeds of a relative few.

Seems reasonable. But it was the birth of “Too Big to Fail.” And it gave the green light to those other accounting firms that  gave AAA ratings to the junk Wall Street peddled in the mortgage fraud that set off the 2008 crash.

That unknown deputy attorney general left the DOJ, became a partner of one of the major law firms that represents players in the Wall Street mortgage fraud business, then returned to Washington as attorney general for President Obama and applied his policy to the Too Big to Fail (TBTF) banks.

With a new twist. Not only must the TBTF banks not be prosecuted for widespread and massive fraud and criminality, but the CEOs and other executives who run those banks must also not be prosecuted. That might “destabilize the economy.”

Too Big to Fail became Too Big to Jail.

Far better, the attorney general and chief law enforcement officer of the United States argues, to allow criminals to run our biggest banks.

Far better for who?

If the past experience of other federal officials who formerly worked in Wall Street law firms or banks is any guide, when the attorney general leaves the government he will go back to the law firm he came from, earning a lot more money than he did previously. His deputy who was in charge of not prosecuting Wall Street did just that, at a reported $4 million  a year.

It’s called the “Round Trip Ticket” and is one reason why it is fair to say the federal government has been "captured" by Wall Street and the major corporations. 

In a recent interview, Rolling Stone investigative reporter Matt Taibbi described it this way:  “People who worked for the regulatory system, they usually grew out of the same corporate defense firms that represent these companies. And when they leave the regulatory system, they go back to these same corporate defense firms and they know they have 2 and 3 million dollar partnerships waiting for them…and they're not really gonna want to screw it up.”

Let me propose a law. All officers of the federal government - presidents, members of 

Congress, cabinet secretaries, agency heads, regulators and others in senior positions must publicly disclose their income and its sources for a period of ten years after leaving their positions. 

This law may not do much to bring the New Untouchables to justice, but at least the American people will begin to understand why they are untouchable.

Friday, May 31, 2013

The Daily Lesson of our Governing Elite

The collapse of American morality

Bucks County Courier Times
May 30, 2013

Morality and democracy are being extinguished in the United States by an immoral and undemocratic governing elite.

Corporate profit has become the god of modern American idolatry. Wall Street barons and corporate CEOs are the high priests of this perverse religion. Washington is its temple, where the apostles of austerity worship, adore and serve corporate profit.

Catastrophic levels of unemployment among the late middle aged, the young and minorities are destroying more than the once fabled prosperity of the American people. In a nation where optimism was once a national characteristic, deprivation and despair are widespread. A killing poverty and suicide are growing, quantifiable realities.

Hope is being extinguished, and with it the morality that sustains a civilized order.

The change came gradually. In service to corporate profit, tax laws allow major corporations to escape taxation. Trade policies obliterated good paying jobs and decimated American manufacturing. Congress votes massive corporate subsidies while gutting the regulations that add cost to the corporate bottom line and quarterly report — no matter the cost to the environment, public health and safety.

All of this was accomplished by massive amounts of lobbying and campaign contributions in an electoral process that is nothing more than a system of legalized bribes which makes a mockery of democracy.

Nowhere is this more evident than in the rise of Wall Street and its domination of the federal government.

Federal nullification of state usury laws allowed the introduction of obscenely expensive consumer credit to mask falling wages and boost Wall Street profits. Banking laws allowed creation of the few “money center” banks and facilitated their profits, to drive competition from the market. Consumer protections were abandoned one scheming step at a time, to nickel and dime bank customers out of billions.

The American people got used to it.

Then Wall Street bribed and lobbied its way to the combination of its banking and investment activities, giving those “savvy” crooks access to the hard assets of the American people. And in an eight year riot of greed and fraud they gambled it away, some $7 trillion and more of the wealth of the American people.

The American people woke up and demanded that those failed banks should not be rescued.

Instead, led by the presidential candidates of both parties, supported by weeks of almost hysterical propaganda and mindful of the legalized bribes of a thoroughly debased election process and the prospect of post-elected office rewards, Congress bailed out the failed banks.

The Federal Reserve pumped more than $20 trillion into those failed banks and favored corporations, while unemployment and foreclosures devastated the middle class.

The new president surrounded himself with Wall Street minders, and Wall Street operatives were installed throughout the “regulatory” agencies, reporting to their once and future Wall Street paymasters.

The attorney general of the United States, the Treasury secretary, the chairperson of the Securities and Exchange Commission (SEC) and a squad of others hold “round trip tickets” back to the Wall Street law and banking firms and major corporations they left for “service” in Washington.

The attorney general found no cause to prosecute a trail of fraud broad enough for a blind man to follow, and then headed off the efforts of state attorney generals to go after the crooks and recover some of the stolen wealth of the American people.

The chairperson of the SEC and her husband made millions representing virtually all of the big banks, which means she must “recuse” herself from any actions against those banks. In other words, the agency will be effectively leaderless in its work to police the markets.

All the while, the incentives and rewards for hustling investors and defrauding depositors remain in place and the Wall Street casino roars on toward the next catastrophe.

While American parents try to teach their children the morality of the ages — the difference between right and wrong, truth and lies, justice and injustice, compassion and exploitation — the daily lesson of our governing elite is that morality is for losers and crime pays, if you’ve got money.


The Sgt. Schultz Defense


Is anyone accountable? 
Bucks County Courier Times

“Hogan’s Heroes” was a popular television sitcom in the late 60s about American and Allied prisoners of war in a Nazi camp during World War II, who pretended to try to escape while running an intelligence operation. Stereotyped and farcical characters got the laughs.

One of the most farcical was the bumbling German guard, Sgt. Schultz, who when confronted by his superiors with the goings on of the ever industrious prisoners, of which he was very much aware, would reply: “Nothing. I know nothing!”

That defense is very much in vogue in Washington these days. Take for example former Secretary of State Hillary Clinton and the furor over Benghazi.

It’s pretty clear what happened. The administration wanted to get an embassy up and running ASAP in the “liberated,” post Kaddafi Libya, to show “progress.” A team of diplomats was sent with inadequate security into harm’s way. When the attack came there was no American force in place to help. People died.

The president says he knew nothing. But he must have known an embassy was being set up. After all, they are his ambassadors. But Clinton knew, and I cannot believe she did not know it was a dangerous place. And as secretary of State at the time, “I know nothing” does not wash.

But that’s what the American people got: a “mea culpa” that avoided mea culpa. In contemporary American politics, that passes as an art form and is much admired in Washington.

And now we’ll get a farcical, finger pointing congressional investigation, when all that is required to end the farce is a simple acknowledgment of accountability from Clinton and an apology to the survivors of the deceased and the nation that she was in charge and made a mistake of fatal consequences.

Don’t hold your breath. Presidential wannabes are made of sterner stuff.

As apparently was a senior administrator of the IRS, who told Congress he knew nothing of a politicized targeting of tax exempt non-profit corporations which may have crossed the line into overt politics, when in fact he knew full well.

Or consider the response to the news that the U.S. Department of Justice (DOJ) has secretly spied for over two months on more than 100 AP reporters, collecting the work, home and cell phone records of the reporters and their sources.

The Obama administration is obsessed with secrecy, and when the AP pierced that veil  to report on the CIA, the Administration secretly spied on the reporters and the Constitution went out the window, along with accountability.

It would make an interesting contest. Put George Bush and Barack Obama on the White House balcony, and see which one can throw a copy of the Constitution the farthest. My guess is it would be a tie.

“Hey, look Barack! I got due process and habeas corpus 200 feet.”

“Not bad, George! Let’s see what I can do with unwarranted search and seizure and freedom of the press.”

Now the scandal over the AP is page one, and nobody knows anything.

The attorney general, who is in charge of the DOJ, says he had no idea, because he “recused” himself when the investigation started. Decisions were left to some underling. But, there are question to be asked.

Did the attorney general give any instructions before he took a powder? Like: “Now look, guys. I know the president wants to get these “leakers,” but I’m warning you: remember the Constitution!” Or, did he bother to check up and see what his subordinates were up to?

Apparently not.

And of course, the president says he had no idea because the attorney general had no idea.

“Nothing. I know nothing!”


Very funny, for a sitcom. For a democracy, not so funny.

Sunday, April 14, 2013

Civil War in the U.S.


It's the surviving middle class against the elite 1 percent

By Mike Krauss
Bucks Count Courier Times

The GOP appears to be a party in disarray, breaking apart over the fault lines of the culture wars it rode to power and joined at the hip to the financial and corporate elite.

But a few days ago it looked as if a civil war had broken out in the Democratic Party, as representatives of President Obama’s most ardent supporters and true believers gathered in front of the White House to hurl their outrage over the assault on Social Security built into the president’s budget proposal.

Not all the president’s base was on the barricades. Conspicuously absent were African American leaders. That’s because the president does not propose to gore their ox.

Social Security and Medicare are critical to the well being of middle class Americans, and for decades, African Americans have been largely excluded from the American middle class.

There is more in the budget that attacks what is left of middle class prosperity, like the proposal to eliminate the mortgage interest deduction in the tax code.

The White House bills this change as a “reform,” and has lined up the support of groups like the Center on Budget and Policy Priorities (CBPP), which argues that the mortgage interest deduction unfairly favors the rich more than the middle-class.

So of course, all right thinking Americans will want it eliminated.

But does the deduction favor the 1 percent?

Here is how the CBPP likes to present the facts. In 2012, 77 percent of the benefit of mortgage interest deduction went to households with incomes greater than $100,000. Some 35 percent of the benefit went to households with incomes greater than $200,000.

What the CBPP is actually saying is that the benefit is not targeted to the poor, most of whom do not own homes, or own very modest homes.

But would you say that a working  couple with children earning a combined $100,000 to $200,000 a year qualifies as “rich” in America today, or would you say they are some of the surviving middle class?

This is another assault on the middle class by a president who lives in the bubble of an elite education, gliding along a career path smoothed by the elite, guaranteed a long and very prosperous retirement among the elite.

Obama’s daughters will almost certainly finish their educations in Ivy League schools, shopping for husbands among the elite. The world will be their oyster, and good for them. But the children of the middle class, many unemployed or underemployed and saddled with massive student debt, will be lucky to find a job shucking oysters in the swell places where the elite dine.

In the 2008 campaign for president, there was a photo of Mr. Obama at a bowling alley, regarding the bowling ball in his hands as an anthropologist might regard some artifact from a lost civilization.

And that is how the president regards the middle class — a relic of no meaning in his life.

America is at war. It is a civil war, the middle class against the 1 percent. But it appears that large numbers of Democrats have finally understood this and are on the offensive. Republicans should join them in protecting Social Security and Medicare, and work to grow the middle class.

The obvious place to start is to shift the tax burden to those who have substantial wealth — the corporate and financial elite who have acquired that wealth by devouring middle class prosperity. The argument that their wealth is invested in growing the economy and building shared prosperity is patent nonsense.

Three measures would begin to turn the tide. The first is to eliminate the capital gains tax dodge, which taxes the financial gains of billionaires at 15 percent. The second is a tax on financial transactions, under consideration in Europe and being ferociously opposed by Obama’s new Treasury Secretary (a Wall Street errand boy). The third is to tax the offshore profits of American corporations.

Three things this president of the 1 percent, by the 1 percent and for the 1 percent does not propose

Sunday, April 7, 2013

American Apartheid


Trapped in a Social Catastrophe

Mike Krauss
Bucks County Courier Times

The United States remains trapped in a slow moving social catastrophe.

Millions of unemployed, late middle aged Americans will never again have full-time, good paying jobs. More millions of the nation’s college educated young are unemployed or underemployed and saddled with debt. The number of children whose diet depends on food stamps is soaring. The nation’s infrastructure continues its descent to Third World status, as public education crumbles with it.

Political power flows from wealth. When wealth is concentrated, so also is political power. Wealth and political power in the United States are now so grotesquely concentrated as to threaten democracy itself.

An apartheid America is emerging: the wealthy few, served by a second tier of retainers (presidents, members of Congress, corporate media, etc), who facilitate the expropriation of what once was the greatest and most broadly shared prosperity the world had even known, as millions are reduced to poverty.

What can be done to arrest the decline?

Stop looking to Washington. Look to Main Street.

The most striking characteristic of the American people has been and remains its diversity, and the magnitude of that diversity. There is nothing to match it. If it can be enabled, that diversity will fire up the engine of American ingenuity and enterprise.

But Washington will not light that fire.

The place to enable and harness the diversity of America is in its cities, counties and states.

The key is banking.

American banking today is as concentrated and dysfunctional as Washington. Nine banks now hold 75 percent of all assets in the U.S. banking system. Yet the system fails in its most important function: the effective allocation of capital and credit into the productive economy.

The trillions of dollars pumped into the failed and bailed banks never got past Wall Street. They sit instead in the banks’ reserve accounts with the Federal Reserve, to prop up balance sheets that are more fiction than fact and make huge profits on the interest rate spread.

While American cities, schools, infrastructure and families disintegrate.

The U.S. banking system urgently needs an overhaul, and it is underway: the creation of a network of state, county and municipal “public” banks, modeled on the hugely successful Bank of North Dakota (BND).

Public banks, often referred to as “partnership” banks, are capitalized with public funds and assets, which are then leveraged as with any bank, to provide affordable and sustainable credit which is distributed into the productive economy in partnership with private, community banks.

Public banks are not retail banks (the BND has one office). They are run by professionals, paid as civil servants, receiving no mega salaries, bonuses or commissions as incentive for the kind of run-away risk taking that crashed Wall Street. Profits are reinvested in the loan portfolio or returned as non-tax revenue to the general fund of the jurisdiction that established the bank.

The BND has a current commercial loan portfolio of more than $2.9 billion and has returned an average of $30 million a year over the past decade to North Dakota taxpayers — in a state with a population of about 670,000.

Public banks eliminate the need for unproductive government “rainy day” funds, can provide disaster relief and low cost student loans, and substantially reduce debt service on municipal bonds and infrastructure projects. They do this by bidding down interest rates, or when the bank buys bonds, returning the interest paid by taxpayers to the taxpayers’ bank.

Public banks work counter-cyclically in the economy, maintaining credit flows during economic downturns, as has been amply demonstrated both in North Dakota, and nations whose economies were sustained by their public banks through the recession that devastated the U.S.

Finally, public banks can serve as the depository institutions for public funds and revenues, bringing billions of dollars back from Wall Street to Main Street, and begin to break the stranglehold the banksters have on the wealth of America.

You can learn about public banking at www.publicbankinginstitute.org