Category: Capitalism Reform

Saturday Soother – March 27, 2021

The Daily Escape:

Stinson Beach, Marin County, CA – photo by Merrill Dodd

A single-point-of-failure in the global economy failed last week when the Ever Given, one of the world’s largest container ships, ran aground in the Suez Canal shutting down traffic in both directions. It’s now stuck sideways in the Canal.

And the Suez Canal isn’t just any waterway; it links the factories of Asia to the customers of Europe. It’s also a major conduit for crude oil. The WaPo reports that 12% of the world’s cargo travels through the Suez Canal. That this vast flow of cargo could come to a halt because a gust of wind blew a ship off course makes the brittleness of our global system of trade apparent.

That one mishap could spread chaos from Los Angeles to Rotterdam to Shanghai underscores the extent to which commerce today is tightly intertwined with the global supply chain. From the WaPo:

“By Friday, more than 160 ships were anchored in the Mediterranean and the Red seas. Egyptian officials appeared confident the canal could reopen within days, while salvage engineers cautioned that freeing the stuck ship might take weeks.”

A delay of two weeks could strand at sea one-fourth of the supply of containers that would normally be in European ports.

The NYT reports that a surge of Covid-related goods orders for items like exercise equipment has exhausted the supply of available containers at ports in China. The cost of shipping a container from Asia to North America has more than doubled since November. And on the US west coast, container unloading has been slowed as dockworkers and truck drivers were infected with Covid-19 or forced to stay home to attend to children who are out of school.

For decades, economists have lectured us about the virtues of “economic efficiency”. But, as the initially poor response of the global supply chain to the Covid-19 showed, economic resilience is also particularly important. We couldn’t get PPE for essential workers because we followed just-in-time inventory management and relied on China as our primary supplier. We’ve also seen shortages of computer chips for cars.

From the NYT: (brackets by Wrongo)

“It [just-in-time] has also yielded a bonanza for corporate executives and other shareholders: Money not spent filling warehouses with unneeded auto parts is, at least in part, money that can be given to shareholders in the form of dividends.”

Once again, we’re learning that the neo-liberal economic solution fails the people. So the economists and the CEOs have gotten it wrong. And the canal blockage, like the PPE shortages, show that they can be spectacularly wrong sometimes. More from the WaPo:

“And the grounding of the Ever Given has exposed how complex ownership structures in global shipping make it difficult to hold anyone accountable: The Ever Given is operated by Taiwan-based shipping company Evergreen Maritime. Evergreen charters the ship from a Japanese firm; a Dubai-based company acts as the agent for the ship in ports; and the ship flies the flag of Panama.”

So, accidents will happen, and they’re nobody’s fault.

The challenges presented by the Suez blockage come directly from the ‘just-in-time’ mantra. While a crisis cannot be predicted, it can be prepared for. Corporations and nations need to stop sticking their head in the sand about long-term planning, and get back to doing what the MBA’s call “resilience planning.”

Resilience planning’s been devalued by our push for short-term profits and stock market gains. If you doubt that, read about the massive cyberhack of US government agencies and major corporations, perhaps the biggest in history, that was discovered in early December by the security firm FireEye. Much of that was preventable by better management and planning.

Globalization isn’t our only problem. Add to it our short-term mindset which, when combined with greed, has endangered America.

It is unclear how long it will take for the Ever Given to be refloated and the flow of the canal traffic can resume. CNN reports that it may be freed over the weekend. But to do that, more than this level of effort will be required:

Credit: Reuters

As the clock ticks, Egypt isn’t collecting tolls for ships’ passage. And many ships, including some operated by Evergreen, have begun to re-route around the Cape of Good Hope. Multiple shipping firms have contacted the US Navy for protection against pirates on their rerouted trip, according to the Financial Times (paywalled).

Enough of the world’s problems for now. It’s time for our Saturday Soother, when we take a break and either watch the Sweet Sixteen if so inclined, or do more spring yardwork, since today is supposed to be the better of the weekend days.

Before pulling on the gloves, let’s take a few moments and listen to “Cloudburst” by George Winston, from his album, “Plains”. The video is of springtime in the northern Idaho plains. It’s a meditation on a few of our feathered friends in spring:

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Japan’s Botched Response to Fukushima

The Daily Escape:

Winter’s end, NH – photo by Betsy Zimmerli

Today marks ten years since a tsunami rolled over the Fukushima Dai-ichi nuclear power plant on Honshu, Japan’s main island. The disaster was bad enough that the event is still known as 3/11 in Japan.

The tsunami and the earthquake that triggered it killed nearly 20,000 people, destroyed over 100,000 homes, and threw Japan into turmoil. The estimated remediation costs so far are about $300 billion, larger than that for any other natural disaster the world has seen.

We remember it largely for the core melt-down at the nuclear plant. That was caused by poor design: The tsunami easily topped the plant’s sea walls, flooding the underground bunkers that contained its emergency generators. The earthquake had cut any outside source of electricity, meaning that water couldn’t be pumped in to cool the reactor cores. The nuclear fuel began to meltdown.

In 2011, nuclear power provided about one-third of Japan’s electricity. Today, only four of 33 commercial nuclear reactors are operating, and only nine have met safety standards set after the disaster.

Across Japan, 53% are opposed to restarting the nuclear power plants. Naturally, that number is worse for people who opted not to return to Fukushima: just 16% said they were in favor of further restarts.

Overall, the Japanese think that both Fukushima plant’s operator, the Tokyo Electric Power Company (Tepco), and the government have lied to them. At the time of the disaster, a botched response cost then prime minister Kan his job, opening the way for Shinzo Abe.

Tepco didn’t even confirm that the meltdowns had occurred until two months after the disaster. At the time, the government and Tepco said it was a natural disaster, but a 2012 inquiry found that it was a “profoundly man-made disaster”, in part due to the chummy relationship between the Japanese regulator and Tepco.

Credibility hasn’t improved. There are 1,000 metal tanks that store contaminated water used to cool the still-hot molten cores of the three reactors. The tanks contain nearly 1.25 million tons of spent cooling water, that’s still radioactive. Tepco and the government are running out of space to build more tanks, so they want to gradually release the water into the sea (after it is decontaminated and diluted) over the next 30 years.

However, in 2018, Tepco acknowledged that 70% of the water stored at the site contained extremely dangerous radioactive contaminants such as strontium-90, rather than just the tritium Tepco said it contained, another huge black eye for the state’s and Tepco’s credibility.

Tritium is a naturally occurring isotope of hydrogen that isn’t considered dangerous to human health. It’s routinely released into the ocean by nuclear power plants worldwide.

So, just like in the US state of Texas, Japan has favored the utilities over public health, and still is doing so today. This is important since Japan’s new prime minister, Yoshihide Suga, has committed to carbon neutrality by 2050. Japan’s renewable energy sector currently produces nearly 24% of its electric needs, but the government thinks that nuclear’s contribution will need to rise from today’s 6% to 20% within 10 years to meet the goal.

But growing nuclear’s contribution to Japan’s energy needs will require rebuilding public trust in nuclear energy. There needs to be more straight talk about how to expand safely, along with clear thinking about the very cozy government-business relationship.

Japan’s handling of the immediate crisis and the long-term solutions makes any discussion of adding additional nuclear power difficult. A survey by Edelman, a public-relations firm, found that the percentage of Japanese expressing trust in their government plunged from 51% before the disaster to 25% after. It now stands at 37%. As Azby Brown of Safecast, a Tokyo NGO says:

“Trust is not a renewable resource. Once you lose it, that’s it.”

Nuclear’s weakness is that it’s expensive and dangerous, which makes new nuclear power a hard sell. It is increasingly being deployed in autocratic nations; exactly where careful regulation is least likely. Russia is exporting nuclear power plants.

China’s nuclear plants are growing as part of an effort to reduce reliance on coal. China produced four times as much nuclear energy in 2019 as it did in 2011 and has 16 reactors under construction.

Countries wanting new nuclear plants now look to China and Russia as suppliers.

Skeptical people always ask nuclear power utilities one simple question: “What will you do with the radioactive waste?” Radioactive waste has always been, and remains, an intractable problem.

And now here we are, wanting zero-emissions power. But we’re faced with the intractable problems of what will resolve the after-effects of the Fukushima disaster, and how to store the radioactive waste from other power plants.

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Limbaugh and Texas

The Daily Escape:

Observation Deck, Niagara Falls – Feb 9, 2021 photo via Darcy Bowers

A quick thought about the death of Rush Limbaugh, and a few thoughts about the Texas power outage.

Many on the right are angry because others are happy about Limbaugh’s death. But we’re under no obligation to tolerate what we perceive as evil. Make no mistake, Rush Limbaugh promoted evil, and Wrongo celebrates the passing of that evil. As Bette Davis said:

“I was told only to speak good of the dead. Joan Crawford is dead. Good!”

On to Texas, and their electric grid disaster. Texas governor Abbott tried to blame the disaster on the “green new deal” and renewable energy sources. That’s a ludicrous argument. No part of the “green new deal” has been passed in Texas, and while Texas is the Saudi Arabia of wind power, only about 33% of its outage came from offline wind power.

A few facts: America is divided into three grids: one covers the eastern USA, another the western states and the third is the Texas grid, which covers most of the state. The Electric Reliability Council of Texas, (ERCOT), manages about 90% of the state’s power for 26 million customers.

The real reason for the sustained outage is that Texas Republicans made sure that Texas had its own electric grid. That was because they wanted to be outside the regulatory reach of the federal government, to set their own rules. So Texas doesn’t follow the maintenance protocols of the other two grids. The other grids have protocols for all power generation equipment in winter weather, including for wind turbines. Of course, Texas doesn’t follow them.

An expert told the Houston Chronicle:

“The ERCOT grid has collapsed in exactly the same manner as the old Soviet Union…It limped along on underinvestment and neglect until it finally broke under predictable circumstances.”

Texas mistakenly thought that by seceding from the power grid, they would provide the benefits of a market solution to delivering power to the state. What really happened is that a lack of capable governing allowed an important and life-sustaining system to rust.

In 2011, Texas faced a similar storm that froze natural gas wells and affected coal plants and wind turbines, leading to power outages across the state. And 10 years later, Texas power companies still have not made the necessary investments to keep plants online during extreme cold. From the Texas Tribune:

“Texas officials knew winter storms could leave the state’s power grid vulnerable, but they left the choice to prepare for harsh weather up to the power companies — many of which opted against the costly upgrades.”

Texas Republicans thought that squeezing more profits out of the power grid for wealthy energy interests was more important than protecting the grid. They were wrong, and Texas consumers are paying the price.

We’ve become the can’t do nation: Can’t stop the plague, even with great vaccines, can’t keep our Capitol safe, can’t keep the heat on in Texas. But once Ted Cruz gets back from his fact-finding mission in Cancun, Texas will fix this in no time.

Wrongo has been to Cancun. It’s good, but not destroy-your-reputation good.

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Are the Wrong People Manipulating the Market?

The Daily Escape

Green River covered bridge in Guildford, VT photo by jackalatch

Out of nowhere, we’re all hearing about “GameStop”. From The NYT:

“Traders on the Reddit message board, r/wallstreetbets, a community known for irreverent market discussions, made GameStop their cause du jour and rushed to buy out-of-the-money GameStop options.”

GameStop (GME) is a struggling, mid-size retailer stuck in a legacy business. They sell physical video games in a world where you buy and play them online. The financial fundamentals for GameStop suggest that its price should be below $20. It’s a real company, with about 53,000 employees, but it’s not worth anything close to its current valuation. It began the year at $19, got as high as $350, and is currently dropping like a stone, at about $196 right now.

Here’s how the r/wallstreetbets crowd made it happen: A hedge fund shorted GME — betting the price would go down — and thousands of retail investors banded together on Reddit to buy the stock, driving the price up. That caused the hedge funds to lose money, since they had to buy the stock for more than they had sold it for.

The r/wallstreetbets crowd numbers about 2 million subscribers. They realized that GME’s float (the number of shares physically available to trade) was very small, small enough that any large order or volume of buy orders would greatly affect its share price.

They knew that GME’s stock could be driven up to the point where the hedge funds that shorted the stock would have to panic-buy them to cover their short positions and contain their losses. They also understood that this could seriously damage those hedge funds.

This is known as a short squeeze, and Wall Street players do it all the time. What’s different is that a bunch of day traders got in on the action. A well-executed short squeeze is a thing of beauty, and in this case, it’s out in the open, and probably legal.

No one seems to be managing this effort. It’s a self-organized campaign with people using message boards to communicate with each other. What’s interesting is that this time, it’s the institutions that were caught with their pants down.

R/wallstreetbets is drawing on techniques used during the 2016 presidential election. Over the course of that campaign, a loosely organized community of alt-right meme pushers and their followers, located on sites like 4chan and Reddit, used social media to barrage Hillary Clinton with an endless flow of memes targeting her supposed inauthenticity and corruption.

They exploited social media to disrupt the normal workings of the US political system, just like these traders are doing this week to the pros on Wall Street. Interestingly, the traders on r/wallstreetbets, describe themselves as “Like 4chan found a Bloomberg Terminal”. It’s a remarkable testament to the internet’s ability to facilitate collective action.

From Bloomberg:

“This is all fascinating. In the space of 12 years, the role of the short-seller has turned on its head. Back in 2008, it was the shorts who upset the status quo, revealed what was rotten in the state of Wall Street, and brought down the big shots. They were even the heroes of a big movie. It was the Wall Streeters who attacked them.”

Now, short-selling hedge funds are seen as part of a corrupt establishment (as they should). And there is a deep generational divide: those unable to own their own home, who have student debt up the wazoo, and are forced to plan retirement without a pension have a stunningly unfair deal, compared to those of an older generation. That percolates into anger, in this case, partly directed at hedge funds.

Anger, at least as much as greed, has the capacity to make us throw caution to the winds. Many of us have a lot to be angry about. It’s impossible to foresee the consequences of similar angry bubbles driven by social media.

It also made a few titans of Wall Street angry. Here’s Leon Cooperman:

This is hilarious! Short positions get squeezed all the time, but the fact that he’s losing to a bunch of losers, who are “sitting at home getting their checks from the government, trading their stocks.” is unacceptable!

For God’s sake these people didn’t even go to Wharton!

And early on Thursday, Wall Street got a measure of revenge, when the trading platform Robin Hood suspended trading in GME. More than half of all Robinhood users own at least some GameStop stock.

No shortage of irony when you’re named Robin Hood, but you protect the rich by blocking everyday citizens from trading.

It’s almost as if capitalism is a tyrannical system arranged to benefit a select few.

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2020 Election Shows Our Economic Divide Worse Than Our Political Divide

The Daily Escape:

Faery Falls near Mt. Shasta CA – November 2020 photo by Gary German

(There will be zero to light posting for the rest of the week. We all need a break from the Turkey of an administration that we’ve endured for the past four years, and this Turkey of a Year.)

The presidential transition is officially underway, nearly three weeks after the election. Despite all of our anxious uncertainty, with almost all the votes counted, it’s safe to say the Biden vs. Trump contest wasn’t close. The Electoral College appears to be holding at: Biden 306 vs. Trump 232, a 57% to 43% win.

There are apparently still about 1.3 million votes to count, mostly in NY. Imagine the drama if NY was the state that winning the election hinged on – we’d all be too drunk to carve the turkey!

If we extrapolate the current margins to the votes that remain, it will look like this: The total Biden vote: 80.6 million; the total Trump vote: 74.4 million; the total minor party vote: 3 million, and the total national vote: 158 million. That means nationally, turnout was about 66%, up from 59% in 2016 and that Biden’s popular vote margin will be 51% to 47%.

There was a more interesting margin of victory: Brookings Metro, part of the Brookings Institution, graphed the roughly 500 counties Biden won against the roughly 2,500 counties Trump won, comparing them by economic output. Here is their map of America’s voting, shown as a chart of relative economic output:

This is pictured as a typical Red vs. Blue breakdown, but it’s not about voting. It’s about that portion of the US economy that voted for the two candidates. Seventy percent of America’s economy is generated in the 500 counties Biden won; the 2,500 counties won by Trump produce just 29%.

Back in 2016, Brookings found that the 2,584 counties Trump won generated 36% of the country’s economic output, while the 472 counties won by Hillary Clinton were about 64% of the nation’s economy.

So there are two conclusions: First, the concentration of economic power has increased significantly in the past four years. Second, a real polarization in America is between its two economies.

Blue and Red Americas reflect two very different economies: The Blue one is oriented towards diverse, often college-educated workers in professional and digital services occupations, while the Red leans whiter, less-educated, and more dependent on “traditional” industries, such as mining, manufacturing and farming.

From Brookings Metro: (brackets and emphasis by Wrongo)

“…notably, Biden flipped seven of the nation’s 100 highest-output counties, strengthening the link between these core economic hubs and the Democratic Party. More specifically, Biden flipped half of the 10 most economically significant counties [that] Trump won in 2016, including Phoenix’s Maricopa County; Dallas-Fort Worth’s Tarrant County; Jacksonville, Fla.’s Duval County; Morris County in New Jersey; and Tampa-St. Petersburg, Fla.’s Pinellas County.”

Still, Trump’s winning of 74 million votes suggests that 47% of us continue to feel little connection to the nation’s core economic future. This may also help explain why Democrats lost all of the 27 toss-up races in the House and Senate.

If this pattern of one Party attempting to confront the social and economic challenges of a majority of Americans while the other Party stokes the hostility and indignation of a significant minority being left behind, we’ll continue to have not just gridlock, but sustained harm for people and towns throughout America.

The Brookings map shows that wealth and power are not only concentrated, but that the concentration is continuing to grow.

If we fail to build an economy for all, it’s possible that at some point the inequality will reach an extreme. What plays out after that is anyone’s guess.

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The Coming Eviction Tsunami

The Daily Escape:

Sunset, Northern CO near WY border – 2020 photo by Maxwell_hau5_caffy. Note the beetle kill.

On Monday, the Republicans released their latest coronavirus stimulus package, the so-called HEALS Act. HEALS stands for Health, Economic Assistance, Liability Protection and Schools.

We know that it drastically reduces unemployment assistance, but it also doesn’t include an extension of the federal eviction moratorium. Last Friday, the federal moratorium on evictions in properties with federally backed mortgages and for tenants who receive government-assisted housing expired.

They should have called it the Republican HEELS Act.

Since Republicans want to cut the amount of federal enhanced unemployment insurance from $600/week to $200/week, it’s likely that many fewer Americans will be able to make their rent payments.

Housing advocates had been pushing for at least $100 billion in rental assistance, as well as a uniform, nationwide eviction moratorium. According to the COVID-19 Eviction Defense Project, we may be looking at something like 19 to 23 million, or 1 in 5 people living in renter households could be at risk of eviction by October.

But that may be optimistic. CNBC published this map of potential evictions by state, based on an analysis by global advisory firm Stout Sirius Ross. It shows the percentage of renters in each state that could face eviction:

For example, 59% of renters in West Virginia (highest) are at risk of eviction, compared to 22% in Vermont (lowest).

The average number for the US is about 43% of tenants are at risk of eviction. That equates to 17.6 million households. The study estimates that there will be 11.9 million eviction filings in the next four months. They think that there will be two million evictions filed in both August and September, leaving 8 million for October and November.

Let’s have a thought experiment. The study assumes that there will be two million evictions filed in both August and September, and another four million in each of the following two months.  Let’s stipulate that each household averages 2.5 humans.

August: 2 million evictions equals 5 million homeless

September: 2 million evictions equals 5 million homeless

October: 4 million evictions equals 10 million more homeless

That totals 20 million people who are casting about for shelter as the cold weather hits the US, with another 10 million to come in November, for 30 million total.

This is an apocalypse.

An important consideration is that perhaps as many as 7 million of them may be registered voters who will be disenfranchised in November, since they no longer live at the address where they are registered.

Think about what’s coming from this change to the Republican bill: Millions of people will be realizing that they have absolutely nothing left to lose, people who feel as though there’s no way out. Then they find they are suddenly ineligible to vote.

2020 has forced our eyes open. All generations that are younger than the Boomers already feel as though any opportunity they had for a sound future has been stolen. In the midst of a global pandemic, they’ve seen Washington deny them healthcare, a safety net, and fritter away most of the societal stability they had.

So where are we heading?

If evictions occur on a grand scale, we’ll be in uncharted waters. It’s not just people being thrown out on the street, there’s no one else moving in. Residential landlords with no tenants face a dilemma, the same situation that has already affected commercial landlords: Few tenants and those who remain are looking for lower rents. When residential properties in the cities become vacant because of eviction or other reasons, and nobody is around to move in, what happens?

Squatting is likely. Carving residences into smaller and smaller units was common during the Depression, and that’s likely to happen again. Our biggest problem is that there is no obvious way to get America off the current Road to Ruin. DC is a disaster on all fronts.

Once the pandemic emergency is past, we will understand the extent to which the rich and politically well-connected have been taken care of, while the poor have largely been destroyed.

We’ve learned beyond a shadow of a doubt how political action, including $multi-trillion bailouts can be mobilized quickly for the right class of people, while helping the rest of us can be dismissed out of hand.

Same old story in America.

What can/should Biden do to change this?

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We’re Not a Failed State, We’re a Failed Society

The Daily Escape:

Sand Dunes National Park and Preserve, CO – photo by exposurebydjk. These are the highest dunes in North America.

Wrongo has written quite a bit lately about America’s fracturing social cohesion, and increasing white grievance as the greatest threats to our democracy. Here’s Wrongo on social cohesion:

“In the past, we had a set of unwritten expectations that members of our society were expected to comply with, like voting, paying taxes, and displaying tolerance for others. Even those deminimus expectations are fraying today.”

The COVID pandemic has many here and abroad saying the US is a failed state. George Packer argued this recently in the Atlantic. The Department of Homeland Security (DHS) says calling America a failed state is:

“…not only wrong, it’s irresponsible at best and dangerous at worst…. So stop saying that.”

Ok DHS, the US isn’t a failed state, but we may be a failed society. We seem to have decided that while we have the means to succeed, we no longer want to try. From Duck of Minerva:

“Failed states lack the resources, equipment, and government capacity to provide public safety and public services. States like Somalia, South Sudan, and Yemen fit this description. The governments of these countries can often barely project authority beyond the walls of their government buildings.”

This doesn’t describe America. We are the wealthiest, most powerful country on earth. We’re home to more Nobel laureates than any country. Our universities are the envy of the world. Our technology sector is the world’s most dynamic.

We’ve lost the will to use our vast strengths to make America a better place for its citizens. If America had the will, we would have blunted the COVID-19 threat, as have New Zealand, South Korea and Germany. Those countries all have far more social cohesion than the US.

And while it’s true that Trump has failed the country, our society no longer feels that we have responsibilities to each other, or to the nation. We have lost the willingness to make personal sacrifices for the good of the community.

Individualism is a crucial part of our national ethos, but it has morphed into selfishness precisely when we need to see ourselves as all in this together. The result is that we’ve shown that we’re incapable of mobilizing the capacity to address the worst threat to public safety of the 21st century.

COVID is the just the third major crisis in the 21st century.

The first was 9/11. Back then, rural America didn’t see New York City as filled with immigrants and liberals who deserved their fate, but as a place that had taken a hit for the rest of us. America’s reflex was to mourn, and mobilize to help. The ensuing Iraq War and partisan politics erased much of that sense of national unity, and fed a bitterness toward the political class that hasn’t faded.

The second crisis was the Great Recession. Starting out, Congress passed a bipartisan bailout bill that saved the financial system. Outgoing Bush administration officials largely cooperated with incoming Obama administration officials. The lasting economic pain of the Great Recession was felt only by people who had lost their jobs, homes, and retirement savings. Many have never recovered, and inequality has grown worse.

This second crisis drove a wedge between Americans: Between the upper and lower classes, between Republicans and Democrats, metropolitan and rural people, the native-born and immigrants, ordinary people and their leaders. Social bonds had been under growing strain for several decades, and now they began to tear. The lasting effect was increased polarization and discredited governmental authority.

Self-pity turned to anger. Anger at Muslims or Mexicans or gays or fancy-pants city folks (or all of them mashed together) offset by a group identity of white grievance. America’s tone changed to defiant anger and hostility.

This was the American landscape that the Coronavirus found: In the cities and suburbs, globally connected desk workers were dependent on the essentials, a class of precarious and invisible service workers. In rural America, it found hollowed-out towns in revolt against the cities. In Washington, Corona found a government that had lost its ability to rally, or work together for the common good.

In America’s president, Corona happily found Donald Trump, the perfect fit for this decaying society. When a corrupt minority rules a dissatisfied majority, there are consequences.

We have literally fallen on our asses. So much damage in a relatively short period of time. Our republic is much flimsier than we thought.

We need a second period of reconstruction in America. The first reconstruction failed because our society failed it. The second reconstruction must fix our failed society.

It will be long and difficult.

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Can America Avoid Becoming a Failed State?

The Daily Escape:

Fall sunset, Shenandoah NP, VA – photo by juliend73

Sorry, but this column is going to be a downer.

We’ve been talking for the past few days about how hard it is to get politicians to focus on fixing what’s wrong in America. Wrongo originally started down this path in 2009. His plan was to lay out the problems, and to suggest ways in which America might fix them.

But 11 years later, little of what has been suggested here has occurred. Explaining what’s wrong has made very little difference.

Our really big problems now seem to be locked in: Climate change will happen. We can’t (or won’t) deal with the burgeoning disinformation platforms that threaten civil society. It’s difficult to see what will change our growing income inequality. As always, politicians are itching for a fight with some country. Today, the villain is China. Globalization has won, our supply chains now hold us hostage, and our economic future is increasingly controlled by Asia.

America is fast becoming a failed state: Our president tells people to drink bleach. There are more than 100,000 dead in the pandemic, and a significant percentage of them probably were needless deaths.

We have the ability to deal with the crises,but we’re choosing not to. Trump and McConnell, along with Biden, Pelosi and Schumer, all have access to the same, or more likely better information than we do.

They are choosing to ignore that the country is going to hell. Instead, they use each individual crisis for their own political benefit, and for their patrons’ financial benefit. They choose to ignore the near-certainty of a second wave of infections in the fall of 2020, bringing with it the possibility of a second economic collapse, along with more deaths.

We no longer provide the basics for our citizens. We live in a nation where income, savings, happiness, trust in government, and social cohesion are all in free-fall.

This is a recipe for social collapse.

In America most infrastructure is decrepit, from airports, to schools, to roads, because there hasn’t been much public investment. That’s because Americans don’t want to pay higher taxes like the Europeans do. Politicians on both sides still believe the evidence-free ideology of neoliberalism: We’ll all be rich if we invest in nothing, and wait for Mr. Market to correctly allocate resources.

No one cares about anyone else. Nobody will support any group’s pursuit of any goal unless it is also their goal. American life is becoming purely individualistic, adversarial, and acquisitive.

We haven’t invested in the systems that provide healthcare, education, retirement, and childcare. As a result, the average American family now goes without many of these things, since they’re priced out unless they have high paying jobs.

We pay absurd prices for health care. Having a child? That’ll be $50K. An operation? It will cost about what you would pay for a starter home. If she didn’t have health insurance, Wrongo’s daughter’s medication would cost $10,250/month. These basics of life are affordable in the rest of the rich world, but in America, they cost more than the average person can pay.

The average American now dies with $62k in debt. Life has become a sequence of unrepayable loans. Student debt becomes credit card debt and a mortgage, which leads to medical debt. These forms of debt define life in America. The average American is now a poor person, in the sense that they barely make enough to pay for the basics of life. Today, 80% of Americans live paycheck to paycheck, struggle to pay their basic bills, and 63% can’t raise $500 for an emergency.

These are the statistics of a nation that is descending into poverty.

Can it be fixed? Sure, but who’s going to pay for it? If taxes can’t be raised, if deficits can’t grow, what will happen? Nothing.

Except that we will move closer to a collapse. Our leaders say it’s because there isn’t an alternative. They say that we don’t have the money to pay for the changes we want. 70% of Americans say they want decent healthcare, retirement, and education, but they never vote for it.

Not even when it is offered during the primaries.

And it’s never offered in the general election, because nobody will vote for higher taxes to fund a functioning society. The idea simply isn’t acceptable to either of our political parties.

Wrongo’s decade of writing about what’s wrong hasn’t changed anything. Change requires a commitment to taking political risks, and massive voter turnout.

Otherwise, same old, same old is the path to our society’s destruction.

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Churchill’s Lessons For Our Time

The Daily Escape:

Algodones Dunes, CA – 2020 photo by _christopherjs. The Algodones Dunes cover 1,000 square miles of Sonoran Desert, making it the largest dune system in the US.

Wrongo fears that some of our country’s problems may be intractable. Blog reader Fred VK agrees:

“I’ve been distressed lately by how seemingly brain dead so much of the US population seems, not only regarding COVID-19 but more, the fragile state of our nation and what the forces of Trump have done and are doing. Some say we will never get back due mostly to lack of resolve. Years ago, I developed this notion that Americans were so complacent about our country and government because they believed that everything was so set in stone that nothing could shake it and that the republic was good to go as is forever.”

Things aren’t set in stone, and they don’t go to hell in a straight line, But from where we stand today, it’s questionable whether America can (or will) be able to solve its biggest problems.

So the question is: What should we be doing when we live in a country where you know bad things will continue to happen, and you can’t stop them?

Worse, in the time of COVID-19, we’re seeing that our efforts to prevent, or to moderate what’s wrong are failing. It’s worth considering that all of our efforts are barely slowing down the worst of what is happening to the climate, to inequality, to the re-emergence of racism, and the rising threat that factionalism presents. For many of us this hits home. We or our loved ones are among those suffering: losing our lives, homes, livelihoods, or living in despair.

We are far from the first to contemplate a civilization’s decline. From Ian Welsh: (emphasis by Wrongo)

“The Roman Empire went through multiple periods of decline…stoics and epicureans debated how to live the good life in an evil world. The Chinese practically had dealing with declining and corrupt imperial eras and warring…periods down to an art: When no good could be done in the world, one returned to one’s private life to write poetry, drink wine, and care for those close to one while refusing as much as possible to be complicit in the evil of the times.”

Words to live by: Avoid being complicit in the evil of the times. This can’t all be blamed on Republicans, but they are primarily responsible for the wrong that’s occurred in America since the 1980s. Can we work together to pull out of our current nose dive? It will require far better leadership than we have now.

Wrongo is reading Erik Larson’s book about Churchill and the Blitz. Larson focuses on Churchill’s first year as prime minister. On his first day, Hitler invaded Holland and Belgium. Dunkirk was only two weeks away, and the blitz was about to begin.

Britain was woefully unprepared. They had just 45 fighter aircraft when Churchill took office, and no one thought Britain could hold out for long against the Nazis. Churchill managed to convince the British people of the “art of being fearless”. He bludgeoned his government and the military on to the same page. Many in England wanted to concede Europe to Hitler, if that meant even a temporary peace, and they had to be brought to see the fight was worth having.

This picture is from a London library during the blitz. It is also the frontispiece in Larson’s book, and shows how people try to normalize even under the worst of circumstances:

Via Shorpy

But we should no longer normalize. Churchill was able to bring his country together despite all the factionalism, and we must make that our goal. Reading Larson’s book puts our own political dysfunction in focus. It’s clear that today, when the stakes are very high (not as high as England in WWII), we also need robust and top quality leaders.

What is our job as citizens, if leadership is to be the difference? Wrongo isn’t saying we shouldn’t fight the big fights. The best way to lose the big fights is to not fight.

We need to cajole, or force if necessary, a few of our politicians to step forward and be the heroes we need.

Many heroes have emerged as the COVID-19 fight has unfolded. We’ve seen good people brought closer together. We’ve felt the pain that comes when we know we must transition from a weaker to a stronger place, but we know we’re not where we need to be.

Sadly, few if any of our current heroes have been politicians.

Some of them need to step forward, and take the chance to be the leader who can teach Americans the “art of being fearless” much like Churchill taught the British.

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Biden Isn’t FDR, But FDR’s 1932 Strategy Could Work

The Daily Escape:

Sunset, Poudre River trail, Fort Collins, CO – May 2020 photo by Dariusva07. Looks like a painting.

Livia Gershon has an article in JSTOR Daily, “One Parallel for the Coronavirus Crisis? The Great Depression”. She focuses on the question of whether America is already in a depression, or if are we sitting in the equivalent of 1928 or 1929? From Gershon:

“Today’s soaring unemployment, small business failures, and uncertainty about the future are like nothing most of us have seen in our lifetimes. If there’s any useful historical parallel, it might be the Great Depression.”

The cliff that our economy just dove off is different from what America experienced in the Great Depression. From 1920 through 1933, America had Prohibition. The 1920’s were a time of unbridled capitalism, and many working class Americans were hurting financially.

In 2020, COVID-19 has hit us fast and hard. Today’s economic crisis is the result of deliberate choices by governments and individuals to restrict commercial activity. However, the results look about the same: Businesses shuttered, families worried about where their next rent payment is coming from, long lines at food banks. And the 100,000+ deaths.

In 1929, life in America was already awful for a lot of people: Businesses had few regulations to constrain their activities. The rich got much richer. Pro-worker policies had little political traction. That all changed after the Depression. By the 1940s, the country’s unions were stronger than they’d ever been and Congress had passed unprecedented economic policies to support workers.

It didn’t happen quickly or easily. FDR beat Hoover in a landslide in 1932. Hoover had won over 58% of the popular vote in the 1928 presidential election, but in 1932, his share of the popular vote declined to about 40%. Democrats kept control of the House, and gained control of the Senate, bringing 12 years of Republican Congressional leadership to an end.

Erik Loomis, a labor historian at the University of Rhode Island and blogger at Lawyers, Guns & Money, offered Gershon historical perspective:

“A lot of Roosevelt’s campaign in ’32 is ‘I’m not Herbert Hoover’….It’s not policy-driven, not about organizing the masses…..In fact, if FDR had been a left-wing figure, he couldn’t possibly have won the nomination of the 1932 Democratic Party, which, like the Republican Party, was deeply beholden to big corporations.”

And today we see Biden, with his man cave presidential campaign, running as “I’m not Trump”. And while he’s not policy-free, his Democratic party is still beholden to big business, much like FDR’s.

Many Democrats worry about Biden’s ability to stand up to Trump on the campaign trail. FDR, despite his polio disability, deliberately chose to present himself vigorously, including breaking precedent by flying to Chicago during the 1932 convention. His campaign song, “Happy Days Are Here Again” remains one of the most popular in American political history.

Biden may also need to consider breaking a few precedents, possibly by running a throwback front porch type of campaign, one that ignores Donald Trump. James A. Garfield, Benjamin Harrison, and William McKinley all ran successful front porch campaigns.

Returning to FDR’s efforts to turn the country around, Gershon says:

“…the major New Deal programs—including public hiring through the Works Progress Administration, Social Security’s old age and unemployment insurance, the NLRA, and progressive taxes—largely followed ideas that had been brewing on the liberal side of mainstream political conversations for decades. To many policymakers, relief for workers was a way of supporting capitalism. It powered the economy by encouraging consumer spending.”

She further quotes Loomis:

“When those measures are passed in the ‘30s, the left considers them all sell-out measures…FDR is heavily criticized on the left.”

In the 1930s, as today, the left wanted more radical pro-worker, and pro-family policies that were a bridge too far for FDR. Today is similar to the 1930’s. As much as Democrats want to run on policy, the candidate (and who the opponent is) are at least as important as policy.

Biden can run on a message of “I’m not Trump. He’s failing. And I won’t fail“. He and the Party can mostly save the details for after the election. For example: Running on some variant of Medicare for all (M4A) isn’t necessary. All Biden must drive home is that COVID-19 has proven that the current private insurance-powered healthcare system has failed us, and that we need reform.

Then impress on voters that the GOP vehemently supports the failed current health insurance model.

Once elected, Biden could push for M4A, assuming he has the Senate.

2020 isn’t 1932, and Biden certainly isn’t FDR. But there are political lessons to be learned from taking a look back in time.

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