Monthly Archives: May 2012

The Irrelevancy Of Trump

Donald Trump is a birther now and, apparently, the world’s most overtly lame bully. The King of Bad Hair has made a living on bluster, bravado, and bull-shit all while somehow convincing the world that he is a genius business operator. What Donald Trump is, is a genius at gaming the bankruptcy and corporate law rigged for wealthy concerns at the expense of small operators. What Donald Trump is , is a genius at playing on American’s love of the pugnacious bully, and that little spark of intellectual laziness that exists in most of us. He is Chris Christie without the baggage, although where Christie like to pretend he would “punch ya in da mowt” if he didn’t get his way, Trump pretends that his personal wealth or television ratings somehow automatically wins the argument.

Why do we listen? Why do we care? Why am I writing a column on the guy? Because, as The Donald knows all too well, the brand Trump is the train-wreck America loves to watch. Of course, The Donald also knows that his brand of business success is still revered; even in a nation where mounting distrust has rightly caused Wall Street to lose much of its undeserved luster. Americans, despite the Occupy Wall Street protests, despite the anti-bailout fervor that fueled what grassroots there ever were in the Tea Party, still value personal wealth as a character component.

These are the reasons that Donald Trump still has a forum.

  1. Everyone who reads this knows someone (or is someone) that works their tails off for less than $25,000 per year. In a nation where the typical family spends more than $8,000 per year in insurance premiums and out of pocket medical cost, $25,000 doesn’t go very far. Yet a majority of Americans still think that hard work=success and, conversely, failure=laziness.
  2. Wall Street financed (and continues to finance) the sale of reckless products (risk without concurrent interest rate reward) that led directly to the Great Recession, and that continue to threaten international financial stability. Despite this, Wall Street types that (like The Donald) make billions off of speculative investments, corporate piracy, or legalized fraud are considered “winners” and (worse) “job-creators”.
  3. The self-proclaimed guardians of ethical behavior and morality in our culture, the various Christian churches, have taken sides, explicitly and publicly, with figures who shamelessly celebrate profit-taking that builds nothing. Again, and exemplified (literally) by prosperity gospel, the earning of wealth, regardless of method, is seen as success. Success is equated with hard work and/or the favor of the Divine, and everyone and anything else is seen as failure. Failure is then equated with laziness, and the cycle is perpetuated.
  4. Personal responsibility and personal accountability are class-specific; working-class Americans who did not understand the ramifications of the adjustable rate mortgage that Ditech, or Countrywide, or Argent sold them with a smile, are failures whose irresponsibility drove the economy into a ditch. People like Donald Trump, who has filed for corporate bankruptcy 4 times, is seen as a success because of his ability to “make a comeback”. No mention is made of the responsibility and accountability (in literal financial terms) that he thrust upon his creditors every time he filed. He left billions, yes billions, in unpaid bills in the various filings, while the homeowners who made poor choices lost their homes, their savings, and their futures. Who again, has been accountable?
  5. Many Americans have, and continue to, support conservative candidates because of a perceived focus by Republicans on small business. “Job-creators”, they are called, and the title is a shield in our culture. A shield, that is, from the responsibilities (and cost realities) that come with business ownership. But the personal responsibility conservatives only seem to want that responsibility extended to individuals, not business interests. Worse, the businesses that get the lion’s share of benefits from this ideological persuasion are, in line with our new thinking, the largest businesses. They want your vote, but when it comes to the benefits conservatives promise business, small operators need not apply. When a man like Mike Huckabee can go on the air and seriously talk about “small business” as those enterprises earning$1,000,000 a year in taxable income, then our economic values have jumped the shark.
  6. In our culture in the 21st Century, it has become impermissible to write what I am writing, and not be thought of as a business-hating Socialist. Despite 20 years of managing and owning businesses, despite an MBA and a commitment to regulated capitalism, I am anathema now. I am criticizing winners; I am critical of a job-creator. Therefore, I must hate America. Democrats in this century, to include the President, have been forced (and sometimes led) into policy positions on business that would have been considered purely conservative 15 years ago. The health care law is a perfect example, and it is widely though of as a Socialist plot of some kind. As is, apparently, anything not made by a job-creator.

It is in this environment that an utter business failure like Donald Trump can bully those with opposing viewpoints by calling out their supposed failings. When Wolf Blitzer, a man at the forefront of the unfortunate modern school of journalism where any guest is usually to good a thing to ruin by criticism or fact-check, had the temerity to call out The Donald on his ridiculous position on President Obama’s birth certificate, Trump repeatedly referenced Blitzer’s low-ratings. No one, I presume, has asked Trump why he was on the show if so few people watched it, but that logic seems to be a relic of a better informed America.

In this environment, a personal fortune built on the plunder of corporate assets, and the ability to escape one’s creditors through bankruptcy, has reached the level of moral capital. Social conservatives have embraced Trump throughout the campaign cycle. Morality in the sense of the Bible, it should be referenced, has never been a strong-suit of The Donald. But, he is wealthy, ergo he is successful, ergo he is a hard-worker, or job-creator, or blessed by God, or all of the above. So what happened to vows of poverty, asceticism, and the meek inheriting the Earth? Donald Trump is P.T. Barnum without the circus, and we are his suckers born every minute. Hopefully, the poor working-class losers among us will wake up and assign Trump to the failure file, and consign him to the irrelevancy he has earned.

 

The Rational Middle is listening…

Memorial Day: Remembering The Point

A quick trip around the web in a free country is an eye-opening experience. The flood of information; the deluge of differing opinions, beliefs, and truths quickly illustrates the notions of both diversity and transparency. The Rational Middle believes it is an obligation of free citizens to question the nation’s participation in conflict, but we in The RM also acknowledge our ability to participate in this discourse is directly related to those Americans who have died in all of our national conflicts. They make both the quick trip, and the diversity of information possible.

During my latest trip, the most common references I have read on Memorial Day have been contradictory. The RM has touched on the day before (here and here), but the differing opinions by service personnel and the extended families of those lost is (to my eyes) a change. For many, the notions of celebrating Memorial Day, of wishing someone Happy Memorial Day, are painful and offensive. For others, the acknowledgement and celebration are fitting and long-awaited. So how do we reconcile these two competing ideals; how do we embrace the holiday without hurting those we celebrate?

We start the way we always must in The Rational Middle; we start by knowing the facts. Memorial Day is not an acknowledgement of veterans in general, although sadly there are no veterans I know of nowadays who don’t have a fallen brother or sister on their mind this day. Memorial Day is the time to contemplate, to recognize, to pay respect to those who have died in service to our nation. Memorial Day is the time to acknowledge, and provide solace and support to, the families of those taken in service. Some will embrace the celebration, others would rather make a silent note; all should know the numbers.

In 74 conflicts, beginning with the Revolutionary War, 1,343,812 Americans who been killed, and 1,529,230 have been wounded. These numbers will go up. These bald numbers are our focal point, around which an extended network of damaged families and saddened friends exists. They are who we recognize, and in our own way and with dignity celebrate, on this Memorial Day.

 

The Rational Middle is listening…

They, Them, And Government Spending

From the dawn of time, in every civilization, the means to shape and control lives have been grabbed and held by those with power. Military power, advantages wrought by innovation, economic resources; all have been monopolized by one entity or another and used to control a population. Mongol warlords, Chinese emperors, Venetian merchants, the Papal authority, and feudal lords have all found ways and reasons to rule. Titans of finance, communicators with the Gods (or God), and kings of men; they are all still with us today. But at times in human history; in some of the Greek city-states, in the Roman Republic, and in a little 18th Century backwater of the English Empire called America, the notion of a people consolidating power and sharing it among themselves has taken root.

The notion of democracy, the foundation driven into bedrock of the ideal, is the ability of a people to collectively control their environment. The democracy shared via the voting public it governs, must be able to influence the marketplace to the benefit of the majority, while safeguarding the entire population from external threats and the erosion of individual liberty. It is, as a number of folks have said over the years, a case study in advanced citizenship. It is not easy, it is not clean, it is not simple. Most Americans have some experience with (and a healthy respect for) the difficulties of democracy in small groups. Church and business committees, parent/teacher organizations, sports organizations and the like give regular examples to regular folks of the difficulties inherent in finding and reaching consensus.

If you think it is tough to find a balance that makes 50 or 50 people out of 100 happy in your organization, try crafting a balance that can make even 160 million Americans happy. “Listening to the citizens” is fine, in fact, it is mandatory. Listening, however, does not guarantee voter happiness in a democracy as large as the United States. Especially when citizens have reached a point where even the most astute are able to rely on services while simultaneously complaining about the existence of said services. All of which brings us to they, them, and that sticky notion of government spending. You see, when “we” aren’t happy with, or are confused by something, we tend to take the “we” out of government and substitute they and them. The we can then, conveniently, take ourselves out of the government value chain, where we are free to criticize anything we don’t like from the perspective of fiscal responsibility.

To be sure, this is a process that has fed it’s share of liberal politics over the years, but the primary value of the process is the legitimacy it grants conservative legislation with the working class Americans such legislation typically hurts. The basic fact of our nation is that all of us benefit from a super-majority of government spending, and that said benefit always exceeds the individual input of every taxpayer, rich or poor. This truth extends first from the reality that the United States of America does not feature any market vacuums; spending and service inputs by private firms and governments alike have unmistakable and clearly measurable benefits on both individuals and organizations across the country. We are, all of us, connected. And because state and federal budgets are so much larger, serving so many more people than even the largest businesses, taxpayers leverage the ultimate scale economies in this marketplace. Essentially, our democracy buys us services at a wholesale rate the marketplace can’t touch.

Nowhere is this more evident than in the medical marketplace. Medicare and Medicaid represent the 800 pound gorilla in the room for our system of government. Cost escalations in those programs are the single biggest threat to government budget stability, past, present, and future. Those escalations reflect the explosive growth in the cost of delivery of medical services throughout our economy, growth that limits access and saps productivity. This needs to be dealt with, and an attempt was made to fix the problem via what was (as early as 15 years ago) a conservative plan for health care reform. But the reform has been roundly attacked by people as diverse as providers, consumers who have coverage, and (of course) conservative ideologues.

The problem, they say, is spending. The solution, they say, is to cut the spending (or tether it to an artificial leash that has the same long term effect). The problems with this approach are many and varied, but I have listed a few below:

  1. The spending supports a need in our economy, not a want. When people are forced to spend larger shares of their income on the same need in their personal budget, they restrict spending on both wants and (critically) the savings for future needs. This has the dual effect of crippling current consumer spending, and placing a cap on long term returns for investors in the domestic economy.
  2. Government spending does not disappear into a black hole or some alternate universe. Spending on domestic programs goes to domestic business. Even that ridiculous boondoggle in Las Vegas with the GSA, while a waste, generated significant economic benefit to business owners and working class people in Las Vegas. For hospitals, half of a typical hospital’s net revenues come from Medicare or Medicaid. What would the care at those facilities be like if that revenue was compromised?
  3. Exacerbating problem #2 is the overall picture for a typical hospital’s gross revenue. Half, that is 50% of a typical hospital’s gross revenue is written off as either charity or bad debt. Subtractions from the principal federal programs for health care necessarily compromise 75% of the typical facility’s revenue.
  4. For the FQHC’s that make up one quarter of U.S. hospitals, the last number given in problem #3 is illustrated succinctly; 75% of revenues in federally qualified facilities come from federal sources. And these facilities are not staples of Blue State largess, most of the large states East of the Mississippi River (including Florida, North Carolina, and Georgia), as well as Texas, are included in those that feature the highest distribution of these facilities.
  5. While we see evidence of rapacious profit-taking in pharmaceutical and medical device firms, the cost of care does support a thriving subset of working class America; nurses, pharmacists, and medical technicians. In our service-based economy, these professions (along with the more aggressively compensated doctors they support) provide badly needed core consumers to the market. Without better compensated consumers, the sellers would have no profits to take. So it is clear that Medicare and Medicaid support a substantial part of the consumer marketplace.

These are just a few problems, in one industry, with the political convention of attacking spending as a disconnected entity in our democracy. The enlightened reader will find many others spring to mind. And this article does not discuss the other imperatives of democracy that must be considered; choice and liberty. These factors are all supposed to be discussed in the institution of democracy we call Congress, but forces have stacked perceptions of liberty and choice against and ahead of all other considerations, with no better reason than the advancement of a political ideology that values electoral victories over real results.

 

The Rational Middle is listening…

The Problem With Romney

Mitt Romney was raised in an atmosphere of wealth and privilege. He was pampered, he was sheltered, he was groomed to do accomplish elite things. As we sit on the edge of the abyss we call Campaign 2012, we Americans have been bombarded with examples and anecdotes and quotes that prove Romney’s background. I don’t think that Romney, in his most gilded moments of fantasy, actually believes he can understand the everyday Americans experience. Many liberals and most of the Americans in the middle have asked the question of Romney’s understanding, and whether it has a bearing on his ability to lead a nation of everyday Americans.

This notion is fundementally unfair, and politically unnecessary.

It is as unfair as the ridiculous connections, made by the political fringe, between Obama and Reverend Wright; between Obama and Bill Ayers; between Obama and (insert blood-thirsty tyrant and political system dirty word).

The Rational Middle expects such connections to come from the political fringe, but liberals ought to know better. And liberals ought to remember that the fringe-driven connections did not work four years ago. But liberals struggling in an economy where normal folks hurt and Wall Street folks get commissions from bailout funds are conditioned to attack wealth. Liberals who most recently championed the interracial kid from Hawaii, or the boy from Hope, or the peanut farmer’s son, have forgotten their own history in their rush to attack Mitt Romney.

Have we on the left forgotten the privileged upbringings of Franklin Delano Roosevelt and John Fitzgerald Kennedy? Have we forgotten our cherished belief in America; a belief that has at its core the guiding principle that anyone, from any background, can achieve anything?

We need to remember our principles quickly, and we need to remember that a full electorate will have a chance to vote on facts, if only we focus on facts in our arguments. The political right has left that argument well in the past, and it is the one weakness that must be exploited, and the one weakness the exploitation of which will serve our honor and posterity.

Mitt Romney isn’t a bad choice for President because he is wealthy or out of touch. Mitt Romney isn’t a bad choice for President because he has a car elevator. Mitt Romney isn’t a bad choice for President because he was a bullying coward in high school. The problems with Romney are purely political, purely factual, and easy to see. Here are five off the top of my head:

  1. Mitt Romney is beholden to a political faction that preaches only two solutions for every problem or opportunity in the American economy; cut taxes or eliminate regulation. They insist then, and Mr. Romney is explicit in his agreement, that the American Democracy is impotent on economics.
  2. Mitt Romney is beholden to a political faction that is willing to mandate that the single greatest domestic policy problem in our nation, our non-functioning medical marketplace, is another item not amenable to solutions of any type by the American Democracy. Mr. Romney’s allegiance on this topic is beyond question, as he has participated in the repudiation of successful state legislation he signed as governor, legislation nearly identical to the actor now known as ObamaCare.
  3. Mitt Romney is beholden to a political faction ready to deconstruct the nation our Founders built as a beacon of religious freedom. Mr. Romney is so ready to submit to the conservochristians, that he gave a commencement speech at a university which has at its core the teaching that Romney’s own religion is a dangerous cult.
  4. Mitt Romney is beholden to a political faction that is willing to subvert American foreign policy to the cause of defeating the incumbent President. Mr. Romney and the political right have criticized, literally, every foreign policy move made by this President. The criticism has been unilateral, contradictory, and fundamentally disconnected from the context of any of the events. Mr. Romney criticized every step of the Libya operation, disconnected President Obama from any part of the destruction of Al Qaeda, and consistently demonstrated a detachment from foreign policy knowledge that borders on the Palinesque. (see point five)
  5. Mitt Romney publicly called the Commander-in-Chief weak on Iran, and stated categorically that if he were in charge, he would have one carrier in the Persian Gulf, and one in the Mediterranean Sea, just to make sure the Iranians knew who the boss was. Mitt Romney said this at a time when the United States had one carrier strike force in the Persian Gulf, another carrier strike force off the southern coast of Iran in the Gulf of Oman, and a third en route from the United States.

Mitt Romney is a Wall Street insider who has proven his willingness to sell out even his religion in the search for Presidential power. He is an unconscionable cad, as an adult, who lacks the spark of leadership, and has failed to define any of his policy prescriptions beyond the stage of sloganeering. Mitt Romney may only probably be someone I wouldn’t want to golf or have a beer with, but he is certainly the wrong person, on a pure policy basis, for the job of President. Liberals need to remember that the Americans in the middle, the folks who will decide this election, can make a good decision without any thought of Romney’s wealth.

 

The Rational Middle is listening…

Walmart, The Town Square, And Libertarian Myth

The persistent mythology of Libertarians is that a free market, with no manipulations by and for the democracy, represents the greatest path to economic freedom. The notion is championed by the U.S. Chamber of Commerce and most of its local branches, and is a major source of traction for conservative politicians with small, local entrepreneurs. It is a myth based in the selective ignorance of history, both in economic terms as well as business, that is the calling card of today’s conservatives. The realities of the market start with the fact that all business relies on the commercial infrastructure that can only be supported through progressive taxation.

Unregulated capitalism is exactly what it is commonly billed as; survival of the fittest. In a pure capitalist society, winners in each major area of business will steadily acquire market capital until they become monopolies. We can see this phenomenon already in many industries; as business gets ever larger, the winners are able to leverage economies of scale to lower their own cost of goods sold, and are able to leverage their status as job creators to blackmail local governments into lower participation in infrastructure funding.

The striking irony of the situation is how visible the problem is in Red State America without any apparent backlash against the idea. For the last 30 years, Walmart has been a principal beneficiary of big firm welfare at the local, state, and federal level. Its property tax payments are far lower as a percentage of operation than any local business, virtually guaranteeing that it uses far more of the infrastructure provided by government than it pays for. Its relentless operations in Red State America have destroyed thousands of small town squares, along with the entrepreneurial aspirations and steady incomes of the former store front owners in those towns.

The world’s largest retailer is not, in my opinion, an evil enterprise. Walmart is only doing what a smart enterprise should do; operate in the most successful model that the law allows. But the question needs to be asked; should laws and tax codes be tailored to the success of very large enterprise, or should they be built around local business needs? The notions commonly thought of as supply side economics have stayed clear of any dividing lines in business; to the members of the Austrian School of economics, business is business. But large enterprise has the capacity and motive to be transient; they can move their assets from state to state, and from country to country, using arbitrage to earn greater and greater returns on their investment.

In plainer language, lowering tax and regulatory burdens on large enterprise does not translate into higher standards of living for working class Americans. Every American is aware, on a daily basis, of the proof for this argument; outsourcing jobs and cash is the common refrain for large publicly-traded U.S. companies. This is why the three decade orgy of federal tax cuts, cash policies, and regulatory blindness has not led to growth in the potential of the American working class. None of these steps has helped local business operators, or those seeking to join the ranks of the entrepreneurial class, to succeed in their endeavors. All this has done for most local business is taken the focus off of the top-line management of their firms (Sales and COGS), and placed it wrongly on the expense and tax lines.

Small, local businesses create jobs that don’t leave a community. Small, local businesses spend their revenues inside the community. Small, local businesses need the commercial infrastructure that only a sensibly crafted progressive tax structure can provide; educated workers and consumers, good roads and utility infrastructure, and quality police and fire protection. The orgy of tax-cutting started by Saint Ronnie the Gipper at the federal level, has only served to push greater burdens onto local government, and local government is inevitably forced to slash the services on which small business relies.

Our democratic narrative has been so distorted that small business owners even came out in full force against the artist known as ObamaCare; an act that would make it easier for perspective business owners to find the affordable insurance necessary to take the risk of business ownership. As it stands, many entrepreneurs are only able to make half a stand; with either themselves or their spouse maintaining a job with one of the privileged big businesses to keep their family covered. As we move further into Campaign 2012, we will hear more and more from the supposedly pro-business camp of Mitt Romney. The question that needs to be answered is what business is he “pro” for? The Rational Middle advocates for liberal solutions that build thriving local business communities, and against big-business welfare of the type that Norquist, Romney, et. al. have championed for so long.

For a strong America, we need our town squares back; we need the little guy to have a better chance than the corporate suits.

 

The Rational Middle is listening….

A Sickness About Health Care

Why can’t we fix this problem? Why can’t a nation that won the Space Race, won World War II, dominated the Cold War, and produced the doctors who pioneered a large percentage of the world’s most important surgical and medical interventions of the last century, figure out its own health care issues? Pundits and politicians have ranted about the economics and legalities for decades now, but regular Americans don’t seem (for lack of a more elegant term) to get it. A conversation I had with a relative recently has served to clarify the issue in my mind.

The reason we Americans are so responsive to single-issue campaigns (think the Reagan assassination attempt and handguns, spotted owls, gay marriage, and abortion), is that we don’t do well when confronted with systemic problems. For all of the regular news we get on housing starts, stock markets, the traded value of currencies, and various unemployment rates, macroeconomics is a foreign (and terrifying) language to most. Our nation’s health care system is immense; like most budget issues, regular folks who are busy with family and work, faith and friends, can’t grasp how truly big the numbers are. Our nation’s health care system is also filled with regular folks like us; people who worked through their schooling and training, people who have jobs to do, people that we trust.

Most Americans are ready to “reform” systems and organizations like the law or government, we readily recognize “crooks and liars” in both. But our family doctors? The nurse who held our hand when we got our shots? The facilitator who answered all of our questions, handed us tissue, and was there for us when our loved one was dying of cancer? Slimy lawyers and thin-lipped politicians (my Father-In-Law’s tone-perfect Midwestern description) need reform, not those good people at the top of this paragraph.

My relative doesn’t like “socialized medicine”. She is alive today because of the Social Security and Medicaid systems, but in her mind, those two sentiments are perfectly compatible. Her brother has lived in Germany for most of his adult life, and struggled mightily with many debilitating problems. Were he to have had the same problems in America, it is unlikely he would be alive today. But my relative was ardently complaining about the German system of socialized medicine. She was upset that “they” wouldn’t approve of a certain treatment.  She thought (and thinks) it wrong that the poor of the world should be denied health care. But she doesn’t like “socialized medicine”.

My relative is a caring, intelligent, and motivated individual. She would give her own life to save a friend or family member, and would probably consider doing the same for a stranger. She is one of the reasons that I dislike it when treasured liberal friends use the phrase “right-wing nut job”. She is one of a majority with little understanding of how a market really works, and how badly constructed our American health care market really is. For us as a country to move past these issues, we need people like my relative to gain some level of basic understanding of the marketplace, and economics, and the realities of medical delivery.

Until she understands, we will never have the critical democratic mass necessary to support real fixes. Without a real fix to our medical marketplace (regardless of the president or party who champions it), we will never control long term deficits, and we will never ensure long term retirement benefits. What is certain is that the free market can never provide a comprehensive solution set, because the profit motive is not compatible for quality, universal medical outcomes. The Rational Middle will feature many more columns on this topic in the run-ups to both the June announcement on the Supreme Court case, and the general election in November. Until then, in the comment section and on the Facebook page…

 

The Rational Middle is listening…