wrongologist – Page 188 – The Wrongologist

Pentagon Can’t Account for $6.5 Trillion

Let’s take another break from the cacophony of the presidential campaign to provide some insight into a Pentagon report that the mainstream media barely covered.

The Inspector General (IG) of the US Department of Defense (DoD) issued an audit report on July 26, stating that the DoD cannot account for $6.5 trillion in total funds, of which, $2.8 trillion is “missing” from the last fiscal quarter. According to the IG’s report: (brackets by the Wrongologist)

Army and Defense Finance and Accounting Service [DFAS] Indianapolis personnel did not adequately support $2.8 trillion in third quarter adjustments and $6.5 trillion in year-end adjustments made to Army General Fund [AGF] data during FY 2015 financial statement compilation…We conducted this audit in accordance with generally accepted government auditing standards.

The IG also said that the DoD agrees they received these funds, agrees the funds are gone, and claims not to have records of where the money went. This doesn’t mean that the money (or equipment and supplies) was embezzled, but without accounting records, the Pentagon just doesn’t know what happened to it.

This isn’t a new problem. On September 10, 2001, then Sec Def Donald Rumsfeld reported that the DoD could not find $2.3 trillion of our tax dollars. After the next day’s al Qaeda attack, the Pentagon and the Congress lost focus on this problem. From the Fiscal Times:

Starting in 1996, federal agencies were mandated by law to conduct regular financial audits. However, the Pentagon has NEVER complied with that federal law. In 20 years, it has never been able to account for the trillions of dollars in taxpayer funds it has spent. An increasingly impatient Congress has demanded that the Army achieve “audit readiness” for the first time by Sept. 30, 2017, so that lawmakers can get a better handle on military spending.

But the IG report says (pg. 21), that they are not likely to comply:

Until the Army and DFAS Indianapolis correct these control deficiencies, there is considerable risk that the AGF financial statements will be materially misstated and the Army will not achieve audit readiness by the congressionally mandated September 30, 2017, deadline.

If this was your bank, and they agreed that they had received a large deposit from you, agreed that they had no idea where it was, and had no plans to refund it, you would sue and move to another bank.

Since this is the Pentagon, you can’t do either. Congress has been allowing the Pentagon to get away with this travesty for decades. Heads should roll at the Pentagon, but where is the Congressional oversight?

Sorry, this is gross negligence, and it isn’t excused because it is done by our “warrior” class who are only trying to keep us safe.

Think about it, $6.5 trillion lost is the equivalent of embezzling $1 billion a day for 18 years. Another way to look at the issue, is that the Pentagon can’t account for around $86 million in our tax dollars per hour. That means the Pentagon misplaces enough of your tax dollars every day to deliver every American free health care.

Now, they almost certainly didn’t lose or steal that much, but they shouldn’t have so much dough to play with until they learn how to account for what they get.

The people deserve whatever regime they endure.

This should be unendurable.

WTF Is It With Cellphone Cameras?

The NYT had an article last Thursday about a suicide rescue on the George Washington Bridge by a bicyclist. Julio De Leon, 61, was biking home from work across the GW Bridge when he saw someone about the jump off the bridge and into the Hudson River. From the NYT:

Then he saw it: a dog in the pathway, tethered to a rail. “This is something unusual, and I looked to my left, and I saw the guy,” Mr. De Leon said.

Sunday Cartoon Blogging – August 7, 2016

At a rally in Virginia, Trump said:

The [economic] numbers are getting worse and worse all the time.

He was saying that he thinks the economy is going to tank, and that he hopes he will benefit politically. It’s clear that if his assertion were true it would help him, but, it’s not:

The BLS reported Friday that nonfarm payrolls rose by a seasonally adjusted 255,000 in July. Revisions showed US employers added 18,000 more jobs in May and June than previously estimated. The unemployment rate was unchanged at 4.9% in July.

In any case, it’s good to know that the Pant Load is rooting for an economic downturn to happen in the next 90 days, so he can personally benefit. Seems like his normal mode of operation.

Sorry Donny, the American economy has now experienced 77 months of consecutive private sector job growth. He’s wrong, but OTOH, it is a very uneven recovery.

On to cartoons. The Rio Olympics dominated Trump’s efforts to command the news cycle this week.

Brazil put its Christ on the Hill statue in an appropriate garb for the Games:

COW Haz Mat

Concerns about Rio’s water reminds us that Congress didn’t appropriate any money for Flint:

COW Olympics Water

Many athletes pulled out due to the Zika virus when the solution was Trump-simple:

COW Citronella

Being in Rio gives athletes a respite from the news at home:

COW Making the Olympics

The ceremonial dumpster lighting kicked off our presidential Olympics:

COW Donnie Dumpster

In other news, voting rights won a few fights:

COW Vote Supression roll back

Why is AARP Funding ALEC?

Yes, you heard that correctly, AARP, the insurance company that styles itself as a champion for senior citizens has become a corporate sponsor of ALEC.

Let’s remember what ALEC is: The name stands for the American Legislative Exchange Council. It operates by offering model legislation to its members, who typically are big corporations and conservative Republican state legislators. It was initially funded by the Koch Brothers.

Its legislative ideas cover practically every area of state government, from education and health to energy, environment and tax policy. State legislators introduce the ALEC-drafted bills in their home states, allowing ALEC’s legislative concepts to metastasize in almost identical laws in statehouses across the country.

ALEC has pushed for:

The repeal of the Affordable Care Act, which has saved Medicare enrollees millions of dollars by closing the Medicare drug benefit “doughnut hole.”
It opposed Medicaid expansion under Obamacare.
It has targeted public pensions, pushing to cap benefits and shift workers toward defined contribution plans, which shifts market risk onto the shoulders of individual workers.
It advocates for privatizing at least a portion of your Social Security taxes.

Governing, a publication for state and local policymakers, says that roughly 1,000 bills based on ALEC language are introduced in an average year, with about 20% getting enacted.

Since 2011, ALEC suffered a backlash, as a number of its corporate sponsors, (more than 100 corporations), pulled their support including Ford, Google, Facebook, and Microsoft, among many others. Eric Schmidt of Google told NPR after deciding to leave ALEC:

I think the consensus within the company was that that was some sort of mistake and so we’re trying to not do that in the future.

So why would AARP sign on as a corporate sponsor of ALEC? From the LA Times: (emphasis by the Wrongologist)

Among the policies that have been promoted by ALEC are several that arguably undermine the interests of seniors and retirees, AARP’s core constituency.

Despite that, the Center for Media and Democracy has learned that AARP joined ALEC, and that it is a named sponsor of the ALEC annual meeting that took place in Indianapolis, Indiana from July 27-29, 2016.

AARP didn’t hide its new financial relationship with ALEC, at least to ALEC legislators. The AARP logo appears in the conference brochure and attendees at the conference were each provided with an AARP branded portable USB power pack as they registered for the event.

Here is AARP’s corporate response when challenged about their new ALEC relationship: (emphasis by the Wrongologist)

In 2016, AARP paid a fee to ALEC, which gave us an opportunity to engage with state legislators and advance our members’ priorities from a position of strength at ALEC’s annual meeting.

AARP’s engagement with ALEC is NOT an endorsement of the organization’s policies either past or present. As is the case with other groups AARP engages with, there are many issues and areas where we strongly disagree with ALEC’s position or approach.

So, who in AARP’s marketing department convinced the top brass that they need to “pay” to meet with state legislators? And wouldn’t AARP members be very interested in what AARP’s management asked of state legislators?

From the LA Times:

Yet in arguing that a relationship with ALEC is necessary to “engage” with the legislators affiliated with the group, AARP is taking a different approach from the dozens of corporations that have abandoned ALEC.

Election Myths and Realities – Pant Load Edition

Ian Welsh lays out a probable narrative that the Pant Load will use if he loses:

Republican leaders and billionaires turned on him when he could have won, flocking to Clinton, and there was voter fraud.

Trump Channels George Costanza

The underlying personality trait of George Costanza is that he’s a liar. He doesn’t try to hide it, he wears it as a badge of honor, and he takes great pride in his dishonesty. Here, in George’s own words:

Those who read the Wrongologist in email can view the video here.

The Donald is the second coming of George Costanza. With all his lying, Prima Donald didn’t have a great Monday. From the Daily Beast:

Monday was an incredible day of falsehoods for the GOP nominee.

The DB goes on to list and rebut a series of lies that Trumpy put out at a few campaign stops and on a pre-recorded piece for Sean Hannity of Fox News. Read the whole list here. In addition, Prima Donald:

Continued to attack against Khizr Khan.
For the second time in two days, Trump attacked a fire marshal at a press conference for having the temerity to not allow him to violate maximum occupancy regulations.
Reacted to the NYT’s investigation of his draft-dodging.
Preemptively declared that the presidential election is rigged.
Announced unimpressive funds raising numbers. (He’s raised $35 million, which he said is “unheard of for Republicans, $35.8 million”. Actually, Mitt raised $101 million in July 2012.)
Declared that if women, even his daughter, were victims of sexual harassment, they should just quit (perhaps overlooking that not every woman can just get another job within their father’s empire)
Praised Paul Ryan’s primary challenger, while Paul Ryan is (1) basically the leader of his party and (2) standing by his endorsement of Trump.

These are just a few of his recent whoppers. Why is he like this? He’s a man whose mentality is completely focused on closing deals. He, like many senior business leaders, sees everything as a transaction.

Wrongo has a lifetime of big business experience with dozens of people like Trump, people who identify with the deal. The deal validates who they are. They wine, dine, flatter, intimidate, abuse psychologically; the closer does whatever it takes to get the signature on the bottom line.

Then the closer walks away, and is on to the next deal, repeating the process. If shit happens after the close, there are designated handlers who are tasked with fixing it, it’s not the closer’s job. Whatever was said or done to close the last deal is irrelevant to the next one. The closer is walled off from the last deal, and the sole focus is validating his/her worth by closing the next one. There is no feeling of remorse for prior actions, no blow-back penetrates the wall.

For Trump, the idea that people would hold his bullying and insults against him must be surprising. That is why he fights back so angrily when caught up short.

Turning his personality to the political arena, Trump above all thrives on winning. He needs to be able to point to victories and yell: I WON! I WON! I WON!

Between the end of the Conventions and Election Day, it’s beginning to look like there aren’t going to be a lot of well-defined victory moments for Prima Donald.

Three months is a long time for a thin-skinned addict to go without his fix.

This is his temperament. It should disqualify him.

Capitalism, It’s Not You, It’s Me

There is a meme that has gone global since the early days of the Occupy movement. Here it is as a wall graffiti from Greece that uses the same meme we first saw in NYC in 2011:

Capitalism Lotek

Just kidding capitalism, it really is you.

The artist is a Greek who styles himself as Lotek. The name Lotek is derived from the short story (and later, a film) by William Gibson called Johnny Mnemonic. The story is set in 2021, in a world ruled by corporations. An anti-authoritarian gang that are called Lo-Teks, fight the power. They are in fact not low tech at all, but are high tech hackers. Sound familiar?

Greece is surely a place at war with neoliberalism and free market capitalism. So is it also time for us to reconsider capitalism?

Consider this from Mark Blyth in Foreign Affairs:

An inherent tension exists between capitalism and democratic politics since capitalism allocates resources through markets, whereas democracy allocates power through voting.

The compromises both systems have struck with each other over recent history shapes our contemporary political and economic world. Blyth observes:

In the three decades that followed World War II, democracy set the rules, taming markets with the establishment of protective labor laws, restrictive financial regulations, and expanded welfare systems.
Starting in the 1970s, a globalized, deregulated capitalism, unconstrained by national borders, began to push back.

And today, capital markets and capitalists are setting the rules, and democratic governments follow them.

Some background: Cutting taxes in the 1980s caused government revenues to fall. Deficits widened, and interest rates rose as those deficits became harder to finance. At the same time, conservative governments, especially in the UK and the US, dismantled the regulations that had reined in the excesses of the financial service industry since the 1940s.

The financial industry began to grow unchecked, and as it expanded, investors sought safe assets that were highly liquid and provided good returns: the debt of developed countries.

This allowed governments to plug their deficits and spend more, all without raising taxes.

But the shift to financing the state through debt came at a cost. Since WW II, taxes on labor and capital had provided the foundation of postwar state spending. But, as governments began to rely more on debt, the tax-based states of the postwar era became the debt-based states of today.

This transformation had profound political consequences. The increase in government debt has allowed capitalists to override the preferences of citizens:

Bond-market investors can now exercise an effective veto on policies they don’t like by demanding higher interest rates when they replace old debt with new debt.
Investors can use courts to override the ability of states to default on their debts, as happened recently in Argentina
They can shut down an entire country’s payment system if that country votes against the interests of creditors, as happened in Greece in 2015.
Citizens United dictates who runs for office in the US, and in many cases, who wins.

Now that the financial industry has become more powerful than the people, should we blindly follow capitalism’s meme as the only way forward?

Free-market rhetoric hides the dependence of corporate profits on conditions provided for, and guaranteed by, governments. For example:

Our financial institutions insist that they should be free of meddlesome regulations while they depend on continuing access to cheap credit from the Federal Reserve.
Our pharmaceutical firms have resisted any government limits on their price-setting ability at the same time that they rely on government grants of monopolies through our patent system.

To use a sporting metaphor, it’s as if the best football team purchased not only the best coaches and facilities, but also bought the referees and the journalists as well. Those responsible for judging economic competition have lost all authority, which leaves the dream of ‘meritocracy’ or a ‘level playing field’ in tatters.

In our country, the divide between the business oligarchs, the political class and “the people” increasingly appears unbridgeable, marked by hostility and deep distrust. When people are told for a generation that government mustn’t make decisions that interfere with free markets, it is inevitable that people will lose faith in democratic governance, and in government’s capacity to help them solve their problems.

Capitalism in its current form no longer works for the people. We have seen a reaction in the start of movements by Occupy, by Bernie, and by others in Europe.

Remember that the greatest prosperity in living memory in the US came during the brief social democratic moment, in the 1950s and 1960s, when the constraints on business were the greatest.

More democracy and more economic justice are the necessary foundations for the path to a more prosperous, and sustainable economy.

A reformed capitalism must be a part of what emerges from that fight.

“Read the Constitution” – A Trump Wake Up Call

By now, most have seen the short speech that packed a wallop by Khizr Khan at the Democratic National Convention in Philadelphia. The speech by Mr. Khan was one of the most difficult/beautiful/gut wrenching 15 minutes of this long campaign season.

When Khan pulled his copy of the Constitution out of his pocket and waved it at Donald Trump, it was only a matter of time before the Pant Load responded. You can count on the Donald. Trump said:

If you look at his wife, she was standing there…She had nothing to say. She probably, maybe, she wasn’t allowed to have anything to say. You tell me.

Khan shot back on CNN’s”State of the Union” :

For this candidate for presidency to not be aware of the respect of a Gold Star mother standing there, and he had to take that shot at her, this is height of ignorance…

Trump then went on to say that he had made a lot of sacrifices by, ya know, hiring people and stuff. That led to a twitter storm carried on the hashtag: #TrumpSacrifices. While there are many funny tweets, Paul Begala, CNN commentator and advisor to a pro-Clinton Super PAC, wrote:

Once survived an entire weekend at Mar-a-Lago with just one can of hairspray.

Or this, Wrongo’s favorite:

Rob Woodyard tweet

OMG, THAT’s what Trump wants to get out of this: He wants to be Kevin Spacey with a comb-over!

Thank you, Khizr Khan for reminding our country that we are founded on what should be a sacred document that lays out how we should live in a society based on justice. And thanks for the sacrifice of your son Humayun, lost while taking part in an ill-advised war:

Humayun Khan

Donald Trump needs a wake-up call for his shocking lack of knowledge of the US Constitution. Let’s start with a list from the WaPo that shows Trump doesn’t know the Constitution:

He wants to “loosen” libel laws, so he could more easily sue news organizations who write “nasty” articles about him. There are centuries of First Amendment jurisprudence that would restrict his ability to do this.
He’s said he would push military commanders to go further than water boarding, even though it has been banned by federal law.
Many scholars believe Trump’s proposed ban on Muslims would be struck down as unconstitutional (due process, equal protection, religious freedom, etc.).
He insisted on “Meet the Press” earlier this year that the 14th Amendment does not guarantee birthright citizenship.
His attacks on Judge Gonzalo Curiel over his Mexican heritage show his lack of respect for an independent judiciary.
Trump has at times suggested that he might somehow be able to initiate the prosecution of Hillary Clinton over her emails if he’s elected. In March, asked about the kind of Justice he’d name to the Supreme Court, he said he’d:

Probably appoint people that would look very seriously at [Clinton’s] email disaster because it’s criminal activity.

A signal he doesn’t understand the role of each branch.

To help wake up the Donald, here is a hip hop tune about the Constitution by Smart Songs, an organization that provides kids and teachers with positive, educational hip hop, to help make learning fun. We chose this because Trump needs to start with an elementary education about the US Constitution, and work up from there:

For those who read the Wrongologist in email, you can view the video here.

Sunday Cartoon Blogging – July 31, 2016

Happy post-conventions Sunday! Now settle back and watch the hair pulling between the Pant Suit and the Pant Load for the next 100 days or so.

Here is an apocalyptic story that you didn’t see while watching the war of tweets between Bernie, Hillary and Donald. First a heatwave hit Siberia. Then came the anthrax: (emphasis by the Wrongologist)

Temperatures have soared in western Russia’s Yamal tundra this summer. Across Siberia, some provinces warmed an additional 10 degrees Fahrenheit beyond normal. In the fields, large bubbles of vegetation appeared above the melting permafrost — strange pockets of methane or, more likely, water. Record fires blazed through dry Russian grassland. In one of the more unusual symptoms of unseasonable warmth, long-dormant bacteria appear to be active. For the first time since 1941, anthrax struck western Siberia.

Ok, so only 13 Siberian nomads have gotten anthrax so far, and the science is unsettled on tundra warming.

Here are a few cartoons to take your minds off the living hell of the election season, or alternatively, taking it off of anthrax and the Zika virus.

Hillary’s nomination was greeted by change on the home front:

COW Glass Ceiling

Bernie mansplained politics to a supporter in Philly:

COW Bernie Explains

Trump’s negotiating style puzzles Putin:

COW Donald Unfaithful

Boris and Natasha get a new gig:

COW Boris and Natasha

The Dems had a bit of buyer’s remorse:

COW Dems Rationale

The big fear with Trump voters between now and November:

COW Big Fear

The Pant Suit vs. The Pant Load – Budget Edition

Now that both presidential conventions are history, the real discussion about the merits of the candidates and their programs begins. The first question to answer is: What are the costs of the promises made to America by Donald Trump and Hillary Clinton?

Both candidates have made political promises that, if implemented, have both costs and benefits to the nation. While the analysis of benefits may be difficult to assess, the costs are not.

The Committee for a Responsible Budget (CRB) has issued a report, “Promises and Price Tags: A Fiscal Guide to the 2016 Election” that estimates how our national debt would rise under the programs of both presidential aspirants. It shows that gross debt held by the public would rise from about $19 trillion today to $23.9 trillion by 2026 under Hillary Clinton’s plan and to $35.2 trillion under Donald Trump’s plan.

They based the estimates on the public positions taken by each campaign as of June 24, 2016. They also generated a low, central, and high cost estimate of the fiscal implications of Trump’s and Clinton’s proposals.

We need to stop and say that our gross debt will rise no matter who is elected, since under existing law, gross debt is projected to rise from about $19 trillion today to about $29.1 trillion by 2026, about a 50% increase. With that in mind, here is CRB’s summary of the impacts of both candidate’s plans on the national debt:

Debt Under Candidates Proposals

Donald Trump has expressed concern about the dangers of our current $19 trillion debt. Yet his plan would increase that number significantly. Under CRB’s central estimate of Trump’s plan, gross debt would more than double from $19 trillion today to $39.5 trillion by 2026.

The increase in gross debt under Clinton’s plan would be smaller but still significant. Under the central estimate of Clinton’s plan, gross debt would rise by more than 50%, from $19 trillion today to $29.6 trillion by 2026, in line with the current law. So, her promise to pay for new spending seems to be true.

Digging a little deeper, here is CRB’s breakdown of both candidates’ plans by revenue, costs and spending. Most of Hillary Clinton’s increased costs come from spending in non-health, non-retirement programs:

She would spend $350 billion more on college education, $300 billion more on infrastructure, another $300 billion on paid family leave, and nearly $500 billion on a variety of other initiatives.
Clinton would also make several health-related changes that would cost about $150 billion.
To offset these costs, Clinton proposes a variety of tax increases – mostly on higher earners and businesses – totaling $1.25 trillion.

The largest share of Trump’s deficit impact comes from his proposed individual and business tax reforms, which would reduce revenue by about $9.25 trillion:

His plan to reform the veteran’s affairs system and increase veterans’ access to private doctors would cost about $500 billion.
And his plans to repeal and replace the Affordable Care Act and reduce illegal immigration would cost about $50 billion each.

So, what happens to the total amount of our national debt?

Donald Trump wants to dramatically reduce taxes for most Americans while maintaining spending relatively near its current levels. As a result, under CRB’s central estimate, he would add $11.5 trillion to the debt through 2026.

Hillary Clinton wants to increase both spending and taxes, adding about $250 billion to the debt over 10 years under CRB’s central estimate. Under their low cost estimate, Clinton’s plan would reduce 10-year deficits by $150 billion.

Increases in debt are not always a bad thing, particularly in times of economic slack, if the debt accumulation is driven by stimulative fiscal policy. But a 40 percentage point of debt to GDP increase, from 87% of GDP to 127% of GDP, seems unlikely to give us a positive outcome.

But, if we elect The Pant Load, that’s what we will get. Trump said to the WaPo in May:

I am the king of debt. I do love debt. I love debt. I love playing with it.

This should worry you. Trump went on to say:

Look, I have borrowed, knowing that you can pay back with discounts. And I have done very well…I would borrow, knowing that if the economy crashed, you could make a deal, and if the economy was good, it was good, so, therefore, you can’t lose.

So, Trump would stiff the nation’s creditors. Haven’t we had enough of Republican mis-leadership on the nation’s finances?

Haven’t we had enough of Republican tax cuts for the most comfortable among us at a cost to the least comfortable among us?

Remember that it was the GOP-led Congress that threatened not to raise the debt ceiling in 2011. That led to the Standard & Poors rating agency’s lowering of the US credit rating.

Think carefully about what Trump’s glib plans imply for America.

The Wrongologist

Geopolitics, Power and Political Economy

Author: wrongologist