Archive for July, 2009

WWWD?

Monday, July 27th, 2009

Did you hear that the Mexican chihuahua who appeared in all those restaurant commercials died the other day? If you were listening to NPR Thursday afternoon, you heard the newsreader lead with that story. An item a little further down in the broadcast mentioned Walter Cronkite, whose life we have been celebrating vicariously, by way of obituary, though his journalistic progeny. They never mention how critical Cronkite was of 21st Century broadcasters. What would Walter do with the dead dog story? Bury it, that’s what! Cronkite would almost certainly have been embarassed to air a dog obit, especially one that doubles as a pitch for the pooch’s principal commercial customer.

I may be the only one who remembers a pitch Cronkite made 12 or so years ago in favor of a government reform that would have forced the TV networks to dedicate a small proportion of their broadcast hours to unpaid political messages. If broadcasters remember this campaign, they’re not mentioning in on the air, and no wonder. It would change the world, and it would cost broadcasters a bundle.

Today, with a good-looking candidate and with the judicious use of television advertising and the media focus that comes with it, it’s possible to buy a seat in Congress or almost any other elective office in the USA. Broadcasters rake in money in what’s become an elections industry. The tithe is so heavy that only rich folks can pay it. The result is a stable of office-holders who owe their status to rich people and broadcasters, whose needs and wants must always come before the public interest. This might change if broadcasters were forced to yield broadcast resources, at no cost, to well-funded and poorly-funded political candidates alike. Cronkite was outspoken in his support for such a reform, and the media ignored his appeals and chose to forget them on the occasion of his death.

What would Walter do with the arrest of the Harvard professor, locked out of his house and caught breaking in by Cambridge police? For sure, he wouldn’t have asked a question about it at a presidential press conference. Not with important events taking place and only an hour to inquire. Obama, as timid as he is lean, fell into the trap set for him by the feral reporter, when she asked whether the incident was a case of racism. The professor is Black. I was hoping for something along these lines:

“Uhhh. That’s your question? You waste an opportunity at a presidential press conference on an idiotic question like this? You know as well as I do that cops make mistakes. They’re trained to intimidate people, and they do it all the time. We expect it of them. It’s the way they establish their authority. Unlike you and me, they can cover up their errors with an arrest, and they do that all the time, too. It’s not news, except among whoring gossip-mongers like you folks. Next question!” A little invective goes a long way.

Not only were the gossip-mongers not embarassed by the question, they’re still talking about it, right alongside the contribution of Walter Cronkite, whose name rings hollow in their arch voices. WWWD? What would Walter do? He’d cry. I suspect he cried often over his squandered journalistic legacy.

Sotomayor Could Have Said:

Wednesday, July 15th, 2009

A few things Judge Sotomayor didn’t say:

“The rule of law has been in decline throughout my legal career. I’d like to reverse that. Inequalities in the legal system now exempt rich and powerful people from punishment for serious crimes and responsibility for gross misconduct, while imprisoning underprivileged and undereducated people in unprecedented numbers. The result is that the citizenry has zero confidence in the laws or the possibility of justice. Most of you senators were sitting right here while it all happened. You might as well stock the Senate toilet paper dispenser with the U.S. Code.”

“I’ll be a millstone around the neck of presidents, including the one who appointed me. They’ve claimed power the Constitution doesn’t give them, even torturing prisoners and abducting and killing people without legal process. I’d like to reverse that. It’s not just bad for the victims, it’s bad for all of us. Does it occur to any of you folks that if the President can bomb a house in Pakistan, on his own say-so and in violation of Pakistani laws, US laws and the UN Charter, he can certainly knock out your digs in Chevy Chase?”

“Don’t pester me with your religion, please, and I won’t pester you with mine. You live in a free country, and free countries don’t serve religions, yours or anybody else’s. Get used to it.”

“You have a hell of a nerve criticizing me, Senator. This could be the most corrupt Congress in the history of the republic. This senator’s taking big money from health insurers, that senator’s wife is working for such and such a bank, the other senator’s neck-deep in Indian casinos, and you’re all cheating on your wives. Your second wives, most of you. Gimme a break, Senator.”

“Senator, I happen to know you’re a lawyer, and no lawyer could read the cases I’ve decided and come to any conclusion but that I’m a competent and experienced judge. I know you’re playing to an audience of hate-filled people–that’s the only kind that would vote for trash like you–but when you impugn my record because of some speeches I made to schoolkids, you shame the entire legal profession, and I feel compelled to warn you against that.”

“I notice that the press is mainly interested in gossip, and you senators are dishing it out like ice cream. Look high and look low in your newspaper and on TV, and you’ll find almost nothing about the decisions I’ve made as a judge. Instead, you’ll see the most unflattering file photo of me that the editor could dig up next to an out-of-context quote from a speech I gave to some sixth-graders. It’s a good thing the founders mentioned “the press” in the First Amendment, or I’d come down like a ton of bricks on the steady stream of disinformation these folks pass off as news.”

Sotomayor may have strong convictions, but, typical of lawyers, she holds them in abeyance. She strikes me as a smart, scholarly and spineless jurist. If she can’t stand up to “Deliverance” characters on the Judiciary Committee, how is she going to fare against the right-wing legion of superheroes, Thomas, Scalia, Roberts, and Alito?

Beating the System . . . to Death

Friday, July 10th, 2009

The irony of the Bernard Madoff affair is that the very people who could have been protected from him by responsible financial regulation would have hollered like hell at any move to restrain him. Madoff ’s cutomers, moneyed people looking to double their wealth every ten years without working, banked with him because he was a cheat. Rich people know, better than anyone, that there’s no legitimate way to make that kind of money on an investment.

Madoff’s customers relied on him to evade regulation at every turn and on his friends in government to accommodate him. And so, with a wink and a nod from regulators in the federal government, Madoff’s accountants regularly overvalued his assets in reports to investors. Money kept rolling in from the richest of the rich, and their wealth, at least on paper, grew at a rate double and triple what your savings earn. Government regulators kept their distance, and it wasn’t until markets failed that Madoff’s true value was exposed.

Some of Madoff’s money-making tactics were clearly illegal, and most were morally objectionable. Even so, he and his clients were allowed to trade without restriction, facilitated by the progressive relaxation of laws and standards over the course of the Reagan/Bush/Clinton/Bush regime. When the economy crashed last year, at the culmination of outlaw government, securities trading laws were (and remain) as permissive as at any time since the crash of 1929.

The typical 1929 investor vehemently opposed any sort of governmental regulation–even measures that would have protected him–and that hasn’t changed much over the intervening years. Being an investor in a company with overvalued assets is a good thing until you’re discovered. Our system of unregulated markets encourages the overvaluation of assets. Anything that covers up the truth is a thing of monetary value to investors in such markets. This makes investors, more than other people, tolerant of ethical lapses in business and government. Investors just want to make money, after all, and they don’t want anybody looking over their shoulder or getting in their way. A mandate for legitimate trading and accounting is the last thing these people want, and corporate directors and managers who propose such things don’t last long in business.

When people put money aside to make money in a market corrupted systematically by relaxed standards, they bet against their personal core values and impair their own ethics. Investors seem to be OK with this. They give money to people who will, for money, use it to subvert any value or corrupt any virtue, to the full extent allowed by law and practice. In that sort of market, the value of an investor’s holdings is at all times imperiled by strict standards and honest practices. You can see this today in the government’s refusal to acknowledge the insolvency of the nation’s banks. If the truth were told, investors would get what rich people call a “haircut,” and they wouldn’t need a comb for a good, long time.

It would be nice if business had not become a branch of organized crime and instead remained a collection of corner druggists, independent newspapers, family farms, neighborhood brokerages and agencies, and other first-tier enterprises that trade on integrity and reputation. These sorts of businesses have been eliminated or swallowed up gradually by less scrupulous, (and consequently) more powerful players, and they have become extinct in most places. Conscience, it turns out, is the heaviest burden a business manager can carry in the 21st Century. Conscience is costly, and the costs have changed the basic character of business, so that it’s simply predatory now. Non-predators are prey.

In Madoff’s case, given the permissive atmosphere and its widespread acceptance among capitalists, sound business practice was simply a matter of cashing out in time. Some did and some didn’t, but they should all have known they were dwelling on a bubble. And they did know it. That’s why, corrupted thoroughly by the investments themselves, these people, through proxies in government, rejected measures that could have exposed their investments’ actual value. Their own departure from principle left them unprotected, and some lost everything.

They were treated justly by a market they helped to defile. The rest of us got screwed.