Friday, January 20, 2017

January 20, 2009-January 20, 2017. The Record of the Obama Economy.



Eight years ago I wrote a post entitled, January 20, 2001- January 20, 2009: The Record of the Bush Economy

As Donald Trump begins his term in office, it is fair to hold President Obama to the same standard. The metrics that were available on that date were the stock market close, the euro exchange rate (in that if it costs more dollars to buy a euro that is both a sign of a lack of faith in the U.S. economy and an indication that it will be more expensive for Americans to either travel or buy goods that are produced outside the country,) net job creation, price of crude oil and national debt.  Later the January unemployment rate was also added as a metric.

Here are how the numbers stood after January 20, 2009.

Dow Close: 7,949.09 (a loss of 2638.51,  or - 25%.)
Euro exchange rate: $1.32 to buy 1 euro (an increase of $.38)
Price of of one barrel of West Texas crude: $34.20 (an increase of $8.22/barrel.)
National Debt: $11.8 trillion (an increase of $6.0 trillion.)*
Net Job creation: + 3.8 mllion jobs (which decreased to + 3.0 million jobs when the January jobs report was added in)
January 2009 unemployment rate: 7.8% (up from 4.2% on January 20, 2001.)

*-- NOTE regarding the national debt :  Generally, the deficit (and corresponding increase in the national debt) for each fiscal year is assigned to the previous President. For example, had 2009 been an ordinary year, then FY 2009 budget (which covers from midyear 2008 to midyear 2009) was passed in early 2008 (though in fact it was a series of continuing resolutions that effectively continued spending levels set in past years) and signed by President Bush.  HOWEVER, as we know, FY 2009 was anything but an ordinary fiscal year.  The actual budget was dwarfed by two massive spending packages: TARP ($700 billion, which was passed and signed by President Bush but was spent equally by Presidents Bush and Obama) and the Stimulus ($890 billion, which was signed and spent exclusively during the Obama administration.)   What this means is that you will see estimates of the share of the national debt run up under each President all over the board, especially as given by people who have an agenda and are being intellectually dishonest.  To ensure consistency, in 2009 and again with this post, I am using a National Debt clock (which to a degree I don't like because it mindlessly keeps track of spending regardless of the source,  but at least it is a consistent way of measuring using the same metric.)  I am not sure which National Debt clock I used in 2009 but they are pretty much all the same.  The one that is being used as a source for this post is http://www.nationaldebtclocks.org/debtclock/unitedstates .

The Obama record:

Let's start with the Dow.  The Dow closed today at 19,827.25 .  This is up 11,878.16 points, or an astounding + 149 %.  In other words, if you'd put your money in the Dow (say by purchasing an index fund) on the day President Obama was inaugurated, by today it would have increased to be worth more than two and a half times what it was then. In fact if you had invested when it hit its bottom on March 9, 2009 (at 6547.05) then you would be up 203 % (in other words you'd have tripled your money.)

The Euro exchange rate today is that $1.07 will buy you one euro.  While this is still worse than it was when Clinton left office in 2001, it is much better than the $1.32 it was eight years ago.  To be sure, part of that is due to the collapse of the European economy, in which the dollar was seen as a safer currency.  BUT that is exactly the point-- the U.S. has been navigating in exactly the same world economic straits as anyone else.  Yet the Obama administration has steered our economy into a path of increasing prosperity that has eluded other countries.  Not only Europe, but also Brazil, China, Japan and other nations have all experienced economic pain.  Considering how difficult a course this has been, it is clear that under President Obama's leadership, the U.S. has come through the Great Recession in significantly better shape than most other nations.

The price today for March delivery of one barrel of West Texas crude is $53.24.  Probably no single commodity is more important in terms of affordability for the economy than the price of crude oil (which is used to produce gasoline, jet fuel, heating oil, fertilizer and plastics, among other products.)  Among its many uses, gasoline is the single biggest product and the one that most people recognize as either being a strain on their budget or not.

The growth in the price of crude oil overall was slightly faster than the net growth from start to finish of the Bush administration.  However, as was noted in the post eight years ago, the price of oil underwent a large degree of volatility during the Bush administration, rising to over $150.00/barrel in June 2008.  It was at times volatile as well during the Obama administration but never reached the degree of boom and bust that the price went through under Bush.    It is true that defenders of oil production will say (and correctly) that the expansion of hydraulic fracturing (a.k.a. 'fracking,') a procedure opposed by many on the left, has increased the supply of crude oil and helped keep the price down.   They will also point out that the President banned fracking on federal lands.  And on both of these points they are absolutely right.  However, the other side of the coin is that the President did not ban fracking elsewhere (though he could have, as some state governments have done) and further it is true that while fracking increased the supply, there are two sides to a supply/demand equation and on the other side, the President decreased demand.  He did this by sharply increasing CAFE fuel efficiency standards on automobiles (such that the new vehicles on the road today have much better fuel mileage than they did a few years ago;  as an example, I have both a 2010 and a 2016 Nissan Versa, and for the same make and model of vehicle, my gas mileage is over 10 mpg higher in the newer car than in the older one.) Also, when he included 'cash-for-clunkers' in the Stimulus package, President Obama specifically made sure that the old inefficient vehicles that were being traded in had their engines destroyed so that they could not be resold on the aftermarket.  This had the net effect of taking fuel wasting vehicles off the road and replacing them with vehicles that used less fuel. SO while it is certainly true that there were reasons beyond anything the President did that helped keep crude oil prices reasonable, it is ALSO true that he did do some things that also helped keep them low.

The national debt is today $19,968,000,000,000 (19.968 trillion dollars.) See the note earlier in this post about sourcing and consistency regarding obtaining a fixed figure for the national debt.  It is certainly true that this rounds to $20.0 trillion, and further it is also true that the increase of $8.2 trillion during the Obama administration is more than not only the dollar increase during the Bush administration but in fact than the dollar increase during ANY previous administration.  Again though, this does not in a snapshot give us the whole story.  Yes, during his first year in office President Obama did spend a lot of money between TARP II, the Stimulus and other measures designed to help the economy. Regardless of what others might say in hindsight, this was absolutely necessary spending;  the risk of a complete economic collapse was very real and in fact, many economists argued that the Stimulus was too small.  Luckily the nation did not suffer a complete collapse and the fire was put out.  In fact, since the disaster in 2008 (which the cost of TARP and the Stimulus hit in fiscal 2009) the deficit has gone down to the point where it is now less than half of what it was then. Obviously a half trillion dollar deficit is still a whole lot of money but it's still important to know that the direction of the Obama deficit has been to generally get less over time.   The fact that it is not even lower is a reflection of the fact that there are still tax cuts in place that reduce revenue even faster than one could reduce spending. For example, President Obama extended the original Bush tax cuts until 2012;  then during the 'fiscal cliff' deal only the highest rate was raised;  most of the Bush tax cuts remained in place.

Beyond this, it is also worth noting that there is one commercial that you didn't hear during this campaign.  That is the claim that President Obama had 'added more to the national debt than every other President combined.'  This claim, which has been standard fare during any campaign in which it applies, was certainly used (and correctly, as Bush had doubled the debt) in the 2008 campaign, to try and tar John McCain by tying him to Bush on the debt.   But while the Trump campaign had a lot of negative advertising they used against Hillary Clinton and tying her to Obama, doubling the debt was not one of them.  That's because it's not actually true.  The debt under Obama grew by 69%;  This is slower than the rate of growth under most previous administrations, and as shown before, was growing by a lesser amount later in the term.

I won't claim then that the Obama record on the deficit is a smashing success, because obviously it's not.  But it's also not the catastrophic failure that some would have you believe.  It will be interesting to see what Trump makes of the debt, given his pledge to push for massive tax cuts that will certainly blow up the deficit, at least in the short term and quite possibly in the long term (keeping in mind that the 2001-2012 tax cuts produced anything but great prosperity during the time when they were in effect.)

Jobs and unemployment numbers were delayed until the January jobs report from the Bureau of Labor Statistics and show a final unemployment rate of 4.8 % (down from 7.8% in January 2009.)  The jobs creation numbers (from February 2009 through January 2017; historical data here) show  11,501,000 net jobs created.   Yes, if I were going to wave the flag unabashedly for Obama then I would begin counting in March 2010 (and give Bush 'credit' for 4,320 million net jobs lost during the first thirteen months of Obama's Presidency and point out that Obama has created nearly 16 million jobs since then) but fair is fair -- I used the same metric for Bush (February 2001-January 2009) so Obama is stuck with those numbers.  The only adjustments may be minor as it is routine for the Bureau of Labor Statistics to make minor adjustments in the two preceding months (which would be December and January) in subsequent jobs reports as more data becomes available;  If the adjustments are positive then Obama will be able to claim 11.5 million net jobs created. The February 2017 jobs report will be the first one credited to Trump,

Saturday, December 31, 2016

New Year's Predictions for 2017

January: Donald Trump is inaugurated.  He causes a furor when he interrupts his inaugural address mid-sentence to call two female reporters covering the event fat and tell them they need to lose some weight.  Later on, the Rockettes perform on schedule at the inauguration but strategically line up behind the President-elect so while dancing the can-can they get to take turns kicking his butt.

February: The Seattle Seahawks win Super Bowl LI over the New England Patriots.  The key play comes in the third quarter, when former Arizona Cardinal and current Patriots receiver Michael Floyd fumbles a short pass but then falls down and is found draped over the ball with a BAC of .217.  Since he fell on it, the ruling on the field is that the Patriots recover the fumble, but the reason it is a key play is because the pile on squeezes some of the air out of the ball.  On the next play, Tom Brady is unprepared for a properly inflated ball and throws a pick-six to Richard Sherman.   After the game Sherman gives another typical Sherman interview and is shortly thereafter given a fifteen yard penalty by NFL President Roger Goodell for illegal use of the Mouth.

March: President Trump wakes up at 3:00 in the morning to tweet about a pharmacist in an obscure town in Colorado who called him a name in an online chat room.  Trump says the pharmacist is 'so unfair' and threatens to sue.  Trump's followers immediately crash the pharmacy's website with derogatory comments, threats and insults.

April: President Trump precipitates a crisis when he fails to sign a debt ceiling increase in time, threatening to default on the U.S. debt.  His initial response is that 'walking away from debt worked for me, it can work for the country,'  but it later turns out that he was on the phone with a Scottish official arguing about the view from his golf course and couldn't be bothered with unrelated matters until it was resolved.

May: The Scottish golf course issue not being resolved to Trump's satisfaction, he orders the U.S. marines to invade and seize Scotland.  When British Prime Minister Theresa May objects and points out that Scotland is part of the United Kingdom, Trump asks what the U.K. has ever done for the U.S.,  reminds everyone that the U.S. won World War II, and calls the Brits 'losers.'

June: Trump begins building a border wall by confiscating taco trucks from street corners in the U.S. and stacking them along the border. In order to make Mexico pay for it, he sends troops to occupy Juarez.  He says he will give it back when Mexico sends a check.

July:  Following up on his pledge to expand America's nuclear arsenal,  Trump withdraws from the test ban treaty, and announces his special Fourth of July program involving nuclear fireworks will be held in California.  He also promises that other Americans can participate and show their patriotism by going outside to cheer when the nuclear fallout cloud passes over THEIR state !

August: Secretary of State and Exxon-Mobil CEO Rex Tillerson suggests in an interview that the U.S. should invade Iran to get the oil.  A sense of deja vu pervades the room and dead silence ensues, until Trump bails out Tillerson by adding, "and to do more of our nuclear testing."

September:  President Trump and Labor Secretary Andrew Puzder celebrate Labor Day by signing an executive order abolishing minimum wage, maternity leave, overtime pay and sick leave, and making unions and collective bargaining illegal.

October: The Cubs win the World Series again.  People start getting bored and talking about how the 'Cubs are always winning.'  Yankee fans are jealous.

November:  Once again, Trump is late signing a routine debt ceiling increase, nearly causing a national default. It turns out that the reason why is because the phone lines to the Kremlin were jammed, so Trump had to wait before he got the official OK from Putin to sign it.

December: Trump's promise to create jobs in coal states actually turns out to be true.  That's because in a country full of Trump supporters, Santa needs to buy tons of the stuff.

Wednesday, May 27, 2015

Why Ann Kirkpatrick is the right person for the U.S. Senate

Back in early 2008,  Ann Kirkpatrick was doing an event in Winslow as she was running in a primary for what would eventually become a successful run to represent the first district of Arizona in the United States Congress.  Our incumbent Congressman, Rick Renzi (now an inmate at the Federal Correctional Facility in Morgantown, West Virginia) had declined to seek re-election after being indicted on multiple counts of racketeering, money laundering and extortion.  People wanted a change, and Ann promised to deliver it.


I'd met Ann and known about Ann a long time before that, which is why I had endorsed her on this blog the day she announced for Congress, and so I felt confident making a promise.  As the event wrapped up, I told her, "I've been making one promise on your behalf."  She got a worried look on her face, because Ann Kirkpatrick is very careful about not making promises unless she is confident she can keep them.  "I've been telling people," I went on, "that you will NEVER end up on the front page of the Arizona Republic after being indicted for money laundering and extortion."  Ann looked relieved.  "That promise," she said, "you can keep on making."

And I did.  That's because Ann Kirkpatrick is personally very honest and isn't interested in being in Congress (or now the Senate) for herself.  As I have told people, "Ann Kirkpatrick doesn't go to Washington because she loves Washington.  Ann goes to Washington because she loves Arizona."

The first thing she did was clean up the office after Rick Renzi and restore the integrity and honor that we as taxpayers and Americans have a right to expect.

Then she got to work.  There is very little of her district that Ann Kirkpatrick has not visited or seen personally with her own eyes.  That is a remarkable achievement, because the district is almost half the total land area of the state of Arizona, and is bigger than a lot of eastern states.  She doesn't believe in just coming out during campaign season or advertising on the airwaves while staying in Washington, as some people do.  One of her opponents complained about campaigning in the district a few years ago by saying he had run up 50,000 miles on his car.  Those of us who live here had to chuckle, since if there is one advance in automobiles where the market has responded to the kind of people who live in rural Arizona, it was to start making cars with a six figure odometer.  I don't know what Ann's odometer reads but I'm sure she wears out cars like she wears out her well-documented boots-- by using them for what they were made for.

But she hasn't gone on all those road trips to small towns just to visit them.  Though she does go to visit and hear from residents, there is also sometimes a specific need that she is able to address.  For example, in our area, back in 2010 there was a paper mill near Snowflake that was about to be shut down due to a problem with so-called 'black liquor,' a byproduct that was costing the mill so much that they would be unable to stay open.  Ann went there personally and negotiated a compromise that helped keep the mill open for another two years.  Unfortunately Ann lost the 2010 election (the only election she has lost) and before she won again in 2012, the paper mill ran into some other problems and closed, as congressman Gosar, who was then representing the district did nothing to try and save it.  Several hundred jobs were lost as a result (and out here good jobs are hard to come by.)    Ann has been able to help work towards a more positive outcome in Winslow, where the town is protected by a levee that prevents catastrophic flooding.  The levee was built by the corps of engineers decades ago, but funding for maintenance was not a priority for our members of Congress, until Ann was elected.  She has gotten some funding to begin needed repairs and maintenance on the levee.  When communities she represents need it, Ann is there. She doesn't just fly over it in a helicopter or send somebody to represent her office, she goes and is there to talk to people directly and then goes back to her office and works on getting them the aid they need.

Ann Kirkpatrick inspecting flood damage near Black Canyon City in 2010.


Ann's voting record has gotten her an earful at times from both the left and the right, but mostly from those who don't see the consistency in it.  Speaking from the left side of the spectrum, I certainly understand progressives who are frustrated at for example, Ann's vote against Cap-and-Trade or her steadfast defense of coal burning power plants in northern Arizona. (disclaimer: I should note, to be sure, that I live about two miles from the Cholla Plant;  I don't work there but a lot of my friends and neighbors do.)  Ann sent a letter to EPA administrator Lisa Jackson shortly after being elected back into Congress in 2012 expressing concern over the jobs at the plants and letting her know that she was against shutting them down. The power plants are a mainstay of the economy in an area where unemployment is still high and a lot of the jobs that do exist don't pay well enough to support a family on.  So she favors finding ways to keep the plants here while still addressing environmental concerns, and she has worked as much as she can behind the scenes to save the jobs in the plants.  Similarly, many on the left have disagreed with Ann for working on opening a copper mine in Globe with Republican congressman Paul Gosar (who incidentally defeated her in 2010 before jumping into a different district-- but Ann realizes that her job is too important to hold a personal grudge, something that already marks her as being tempermentally an improvement over John McCain, who notoriously holds grudges for years.)   But the mine in Globe would provide over a thousand jobs in a community that has suffered steep declines in employment, so Ann while recognizing the opposition to it, supports the mine.


It is, however a mistake to think that congresswoman Kirkpatrick is a James Watt clone who doesn't care about the environment.  She cares about it a great deal and has worked on legislation to protect the Red Rocks near Sedona and has strongly opposed uranium mining near the Grand Canyon.  In her travels she has visited the Navajo reservation many times, a place where the few surface water supplies that might have been available have mostly been polluted, and people have been getting sick and dying, from the legacy of uranium mining during the 1950's through the 1980's. The Navajo Nation has banned any more uranium mining as a result, and Ann has supported plans to keep it out of the neighboring national park and surrounding areas.


On the right, aside from the usual boilerplate claim that Ann is a 'liberal' or 'beholden to the Obama administration' that Republicans make against any Democrat in a swing state (claims that are frankly silly in light of her moderate record and willingness to take on the Obama administration on issues like the power plants)  for the most part the criticism is directed at her 2010 vote for the Affordable Care Act and her continuing to defend it after returning to Congress following the 2012 election.  But her support for the Affordable Care Act was for a very straightforward reason and it is the same reason she has prioritized supporting jobs. When she voted for it, 21% of the people in Congressional District 1 (with slightly different lines than it has today) had no health insurance.  This was one of the highest figures in the country. Rural hospitals were teetering on the edge of bankruptcy because of all the uninsured patients flooding into emergency rooms.


In addition, Ann worked to get permanent funding for the Indian Health Service (IHS) included in the ACA before she would vote for it.  We have forgotten that today, but it used to be that IHS funding was sort of like the Medicare 'Doc Fix' or the 'Alternative Minimum Tax' (AMT) fix that was finally really fixed during the 'fiscal cliff' negotiation --a political football Congress had to fight over every year before they'd pass a short term fix. Ann insisted on and got a permanent 'fix' so Congress has one less political football to fight over.


Similarly, she supported the Stimulus, not only because of the dire national emergency we were facing at the time (in case anyone forgot we were losing nearly a million jobs every month and the economy was headed straight to hell) but also because of the glaring need for infrastructure in a broad spread out district.  This is a huge district with a lot of underpopulated areas so building and maintaining infrastructure is very important here.   In my morning delivery job I drive over a bridge south of Joseph City that was rebuilt a few years ago with Stimulus funds.  The old bridge was rickety and after the I-35 and I-5 bridge collapses  caused by past neglect of infrastructure (in no small part thanks to John McCain's crusade against dreaded 'pork')  I really wondered a few times whether they would even notice if that one fell into the Little Colorado River.  But fortunately, because of the Stimulus and Ann Kirkpatrick and other members of Congress who were willing to stand up and vote for it because it was the right thing to do, I can breathe a little easier in the morning when I drive across that bridge.


Ann did however oppose the release of some TARP funds.  Fundamentally, it did not help people who needed help. Bank bailout funds were not of much use to people in Arizona who were losing their homes.


And that defines the consistency in Ann Kirkpatrick's positions.  IN EVERY CASE the defining  question has been a simple one:  What most benefits her constituents.  In a district as large and diverse as CD-1 that is not always an easy question to answer, but it has defined Ann's concerns and her realization that she works for us, not the other way around.  


Let me summarize that again:  Ann Kirkpatrick in the end makes her decisions not based on what the Obama administration wants, or because of what some Washington lobbyist wants, or what some Super PAC wants, or what the news media wants, or what some pollster is telling her will be popular.  She makes her decisions based on one thing only:  What will make the most positive difference in the lives of the people she represents.


Ann also understands a very important principle that few in Washington seem to these days. This is the principle that the voters have sent her there to solve real problems and expect people there to work together to solve them, rather than retreat into partisan camps that throw insults at each other without either of them having the ability to solve anything on their own.  That is why she has been working with Congressman Gosar, and also why in a session when Congress as a whole, fractured by partisan infighting set a record for being the LEAST productive Congress ever, Ann was the first member of the Arizona delegation to write a bill which passed both houses of Congress and was signed into law. Just moving a bill through Congress requires doggedly hard work, and we are fortunate to have someone who is a doggedly hard worker like Ann running for the Senate.


John McCain may be off galavanting all over the world, trying to make the case that we should send our boys and girls into every foreign conflict when it pops up,  or be on all the TV news shows giving us his opinion about national and international issues, but you will probably find Ann in her office at the same time, working on legislation or constituent issues that need to be addressed.   As one rancher who lives south of town here told me this morning when we were talking about Ann's announcement,  "What's McCain ever done for Arizona?"  The answer is nothing.  If it doesn't enhance his national profile, he can't be bothered with it.


In closing, I should add that congresswoman Kirkpatrick is just as doggedly hard a worker on the campaign trail as she is in Washington.  In the 2014 election, outside 'dark money' groups spent over $10 million against her, literally beginning even before she was sworn in at the start of 2013 and continuing up through election day. This tide of dark money buried Democrats from coast to coast last year, and helped Republicans sweep all of the state offices in Arizona.  But Ann is too tough to be intimidated by that kind of pressure, as those of us who have gotten to know her are aware. Not only did she work hard to raise enough money on her own, maybe not to match that level of spending but at least to get heard, but she put all of us to shame.  We may have spent weekends or evenings knocking on doors or talking to voters, but nobody worked harder on her own campaign than Ann. Ever see that famous old photo of Adlai Stevenson with the hole in his sole?  Ann may wear cowboy boots on the campaign trail but I bet she's gotten some holes in a few of them by now.   Beyond that, people here voted for Ann because she's real. This is a district that voted for Mitt Romney in 2012, and went solidly for Doug Ducey in last year's governor's race.  But a lot of voters who voted for those Republicans voted for Ann both in 2012 and in 2014.   That's because even when they disagree with her (as I sometimes do as well,)  we all know that Ann doesn't let anyone tell her how to vote, and she is committed to working as hard as she can to do the best job that she can for the people of Arizona.


Tuesday, April 14, 2015

The Last Casualty of the Civil War-- was it Lincoln?

A century and a half ago, this very night, Abraham Lincoln was martyred.  John Wilkes Booth, a leading actor of his day, had shot the leader of the United States as he sat in his booth watching a play, "My American Cousin."  The act shocked the nation, just five days after Lee's surrender at Appomattox courthouse had signaled the end of the Civil War.

For this reason, Lincoln has sometimes been called "the last casualty of the Civil War,"  a label perhaps immortalized the most strongly by Rod Serling, the creator of the "Twilight Zone."  In one of its most famous episodes, called 'the Passerby' a widow first meets a young soldier walking on the road and learns he has died in the Civil war, then meets Lincoln and learns he has also died.


It is certainly symbolically appropriate to call him the last casualty of the Civil War, but is it accurate?

No, it is not, except that Lincoln perhaps has as much claim as many others, for there are many ways to define who was the last casualty of the war that perhaps it can be argued, the United States itself is to this day still a casualty of.


On May 13, 1865, the battle of Palmito Ranch was fought, between small groups of soldiers who had yet to lay down their arms, in South Texas. Most of the dead died quickly, but Indiana Private John J. Williams was only mortally wounded and died hours later on the battlefield. So some historians consider Williams the last casualty of that war.
Six days later however, on May 19, 1865, there was a small skirmish between former confederate soldiers who were described as ‘unrepentant rebels’ and a union force lead by Lt. Joseph Carroll, at a place called Hobdy’s bridge in Alabama. One member of the force, Corporal John W. Skinner was killed in that fight and can also lay claim to being the last casualty of the Civil War. However, three of Skinner’s comrades who were wounded in the same fight, were later denied pensions on the basis of a claim by the government that the war was over and they were not eligible for pensions for injuries received during ‘peacetime.’
Was it confederate Major Henry Wirz, the commander of the notorious Andersonville prisoner camp, who was hanged on November 10, 1865 after being found guilty of what we would today refer to as atrocities? You could make that case.
In fact, if we consider hangings, a case could be made in relation to the notorious family feud between the Hatfields of West Virginia and the McCoys of Kentucky. Asa Harmon McCoy (in contrast to some other members of his family) joined the Union army. When he was injured in the war he returned home, but as a returning union soldier was murdered by pro-confederate members of the Hatfield family. The feud sprang directly from the civil war, so a case could be made that the last casualty of that war was Ellison Mounts (a Hatfield,) who was hanged on February 18, 1890 for the murder of Alifair McCoy.
Or, was it Sam White of Chesterfield, Virginia, who died on February 18, 2008 (118 years to the day after the hanging of Mounts) while trying to restore an unexploded Civil War cannonball? There are still to this day hundreds or perhaps even thousands of unexploded shells from that long ago conflict buried in the eastern U.S. And there is no guarantee that White is the last casualty if you count him as one, either.



And so perhaps that brings us back to the present day. It is sometimes difficult to separate fact from fiction, but especially in learning our history, we must try as hard as possible to do so.

Friday, March 27, 2015

The real questions about Jeb Bush are about what he's been doing since leaving office.

Lately all the speculation about Jeb Bush has focused on his last name,  asking whether as a ‘Bush’ he can win following his father and his brother. Both left the Presidency in the midst of recessions and his brother is also associated with unpopular and ruinous adventures abroad.


In so doing, the focus has not been sufficiently on Jeb himself.  Occasionally stories do come out—for example when the Clinton email flap surfaced, it was pointed out that  JebBush used his own private email server while he was Governor  but in fact that is something of a non issue since apparently it’s the norm among potential presidential candidates.


But the big story regarding Jeb Bush is not what he did WHILE he was Governor, it’s what he did after leaving office.  His first job was as a paid consultant to Lehman Brothers bank.  In case you forgot, Lehman Brothers was the touchstone for the economic collapse. During the 2000’s, rampant speculation in the housing market and the quick money to be turned as a result led a number of banks, including Lehman Brothers, to invest their money in risky investments tied to home mortgages that quickly turned bad when the housing market tanked. And what did Jeb do for Lehman Brothers?  Well, he was assigned a special mission (while his brother was still in the White House.)  Jeb was asked to go to Mexico and try to persuade billionaire Carlos Slim to bail out the company.



Slim, the world’s second richest man, patiently listened to Jeb’s plea, but could see where Lehman Brothers was headed and wanted no part of propping it up to stave off the inevitable collapse.  It is hard to imagine that Jeb, who is supposed to be brainy, didn’t see it as well. So as a consultant, one has to question either his judgment in trying to get people to invest in a bank that was sinking like the Titanic if he was one of the few in the company who didn’t see that, or his ethics if he did see what was happening.



So after the collapse of Lehman Brothers, did Jeb leave the banking business? Not at all.  In fact, he moved on to a position as a consultant with of the British banking giant Barclay’s (a position he kept until very recently when he resigned all of his board positions and other positions in order to begin putting together a run for President.) So how did Barclay’s do with Jeb Bush advising them?

He stepped into Barclay’s as the company was actively working to manipulate LIBOR,  officially the “London Interbank Offered Rate,” which is a key rate used to set fixed interest rates.  Barclay’s continued with the collusion of several other large banks including the Royal Bank of Scotland, JP Morgan-Chase, Deutsche Bank and Citibank  (which it is hard to imagine a financial consultant would be unaware of) to manipulate the rates until in 2011 when it was reported that the banks were under investigation and then in February 2012 when the scheme unraveled.  Eventually Barclay’s agreed to fines of nearly half a billion dollars to several different international regulatory agencies. As part of their agreement with the Securities and Exchange Commission, Barclay’s agreed that some fixed interest rates may have changed as a result of the manipulation.
   This is not a small thing.  One memo between a trader and Barclay’s revealed that  for each basis point (0.01%) that Libor was moved, those involved could net, "about a couple of million dollars."



After Barclay’s got out of the business of manipulating interest rates (or at least we would hope) they moved on to currency.  Some of the same banks Barclay’s colluded with on LIBOR, discovered a new way to gamble with the economy in order to skim some money off the top.  They all colluded on foreign currency exchange rates. In theory international currency is supposed to ‘float,’ so that people who want to, for example, trade in their Euros for dollars can do so at a rate that is set purely by the international markets;  high demand for a currency makes it more expensive and lower demand reduces the price.  However, the banks discovered they could move the price around the edges, and as a result make a lot of money by investing in currency that they could then move the exchange rate just enough to make a profit.  Never mind of course that the profit they made means someone else lost money,  they found they could make money, and a lot of it. After being burned by the LIBOR fine, Barclays’ this time became the ‘snitch’ in the group and essentially ratted out the others ; in exchange for a smaller fine.  Because of their cooperation, Barclays was subject to a fine but got a ‘deferred prosecution agreement’ which in effect means they don’t actually have to pay the fine.  All they have to do is keep their nose clean.


That can’t be too hard, can it? Apparently, it is pretty hard, for big banks anyway.   Like a hungry swarm of locusts, the same clique of megabanks (including Barclay’s) that had such a big role in manipulating interest rates and currency exchanges,  moved on to manipulating the price of metals.   As before, the banks raked in big profits while small investors were left holding the bag for the losses on one side of an equation where the other side turned into big bucks for banks.  The investigation into price fixing in the metals markets is ongoing, but suffice it to say that I suspect a lot of ‘gold bugs’ will be furious that instead of the free market determining the price of their favorite metal, it was instead a small group of deeply pocketed bankers who decided what it would be.  And again, any consultant on any bank that was unaware of the metal price manipulation (especially after having gone through the LIBOR and FOREX,  or foreign currency exchange manipulation scandals)  would have been completely absent in their duties to pay attention to who they were working for. Maybe that's why the establishment wants Jeb so much.  Some apologists for his brother claim George W. was 'out to lunch' and could be manipulated by a Praetorian Guard who could pull his strings.  Jeb's work for Barclays when they were involved in financial scandal after financial scandal after financial scandal seems to suggest that that might be the case.




It is true that there is more that could be said about Jeb Bush and the record of corporations he has worked for or been on the board of both in and outside of the banking industry since leaving office, but the most important thing that can be pointed out is this, because it speaks to the entire outlook of the organization he was advising at Barclay’s:  The year (2013-2014) when profits fell 22% (largely because of fines) and the bank was caught up in three major scandals  (in other words a bad year for Barclay’s)  the bank   laid off 19,000 people  followed by an announcement they would   lay off another 12,000 people    because of an abysmal earnings report.




BUT what did Barclay's do after the abysmal performance and layoffs of thousands of people?  What the boards of large companies often do these days (too often):   paid 481 people at the top enormous bonuses of over a million pounds (meaning substantially over a million dollars) apiece.  This reward voted by the members of the board of the bank that Jeb Bush was advising is a depressingly familiar narrative.  The members of the Board (millionaires themselves)  apparently at least understand and do not hold responsible the millionaires who work for them at the top of the company (including those Jeb was working with,) and understand them well enough to give them massive bonuses even when they do a poor job or harm the company by exposing it to unwarranted risk. So what did Jeb Bush do?  Simple. Continued advising Barclay's.



So to summarize, after sustaining losses but rewarding the people in charge (likely the only ones the Board Members see very often)  the bank Jeb was advising balanced the books by cutting the jobs of secretaries, data analysts and computer techs, and perhaps also others who take orders from the people who actually were in charge and caused the poor performance in the first place.


That kind of thinking,  making the poor pay for the sins of the rich while rewarding the rich for sinning is standard fare for modern conservatives.  But a letdown if you were optimistic that somehow this Bush would be different.

NOTE:  AN EARLIER VERSION OF THIS POST NAMED JEB AS A MEMBER OF THE BOARD OF DIRECTORS AT BARCLAY'S.  THIS WAS BASED ON INFORMATION THAT WHEN IT WAS WRITTEN WAS WIDELY PUBLISHED ON THE INTERNET INCLUDING FROM SOME RELIABLE SOURCES, BUT HAS APPARENTLY BEEN WITHDRAWN.  THIS POST HAS BEEN EDITED TO REFLECT WHAT IS NOW BEING REPORTED THAT JEB BUSH WAS AN ADVISOR TO BARCLAY'S BUT DID NOT SERVE ON THE BOARD OF DIRECTORS.
 

Friday, March 06, 2015

Why I Support Capital Punishment (Almost) Never

Over the past twenty-four hours I've had a couple of events that have caused me to contemplate the death penalty and clarify how I feel about it.

One of them is that a friend of mine posted a link from the U.S. conference of Catholic bishops opposing it.  Of course I am not Catholic,  but I understand the concerns of the bishops.  However I had to disagree with the premise of her post, though in fact in most cases I would agree with her (and the bishops.)

The second of course, living here in Arizona, was the Jodi Arias sentencing case.  As many may know, a single holdout juror refused to vote for the death penalty, and as per state law that means that Arias, convicted of killing her boyfriend Travis Alexander will not be sentenced to death, but instead will spend the rest of her life in prison.

Let me state a summary, and then go on and clarify as to why I do not support capital punishment today, but if some specific problems were fixed then I could support it:

1. I believe that there are cases where capital punishment is warranted.  However, these cases are exceedingly rare, and I do not believe that Jodi Arias, as brutal as her crime was, qualifies.
2. I believe that the system is broken, both in terms of the number of proven errors that have been made, and in terms of the basic inequality of the justice system in which race, class and ability to pay are correlated with likelihood of being sentenced to death when convicted of the same crime, when in fact if the system was working properly these factors should have no such correlation.
3. Until the system is fixed, I do not support any further executions.  In other words, I favor a moratorium, and then perhaps a resumption only after these problems have been addressed.
4.  While it may be warranted in extreme cases, I do not buy the argument that it is any kind of a deterrent, will address prison overcrowding, or will save money (though 'saving money' would be a terrible justification for executions, even if that were true.)

First, when is it justified?  I believe that taking a person's life (assuming we are absolutely certain of guilt, which I will get to later) is only justified if the particular crime is so heinous as to completely be beyond the bounds of civilization, and further that it rises beyond ordinary human expressions of rage, violence, jealousy, passion or other kinds of reasons why murders happen, but maybe are not characteristics of a person who is a cold blooded killer.  In other words, premeditation must be a part of the murder.  Someone who gets angry and kills may need to spend the rest of his or her life in prison, but I don't believe that is a good enough reason to kill them. People can of course argue this point, but I do not believe a person who kills in a fit of anger but may regret it later is on a par with someone who coldly calculates what they are going to do and then does it.  

Between this sort of premeditation and the heinousness of the crime, I can name a couple of people who I believe should get or should have gotten the death penalty.  I would have given it to Charles Manson (but not to his followers, who were after all followers.)  Timothy McVeigh was executed for his crime, and rightly so.  The one case that really haunts me however happened in 1999.  My daughters were just about the age of Shawn Ryan Grell's daughter, Kristen Salem.  I still can hear a two year old child's terrified scream, 'No, daddy NO!!!' when she realized what he was about to do.  I don't want to say anymore about that here, other than the case was so horrible that it at one point caused a judge who had sat on the bench for 30 years to impose the one and only death sentence she ever imposed. Later it was thrown out on the technicality that the law had changed and required a jury to consent to a death sentence, but in 2009 it was reinstated when he was in fact sentenced by a jury.  The details if you have a strong enough stomach  to read them are here .  Grell's crime was so awful that a judge who sat on the bench for thirty years only handed down one death sentence in all that time:  his.   Put it this way:  I agree with the judge.  The death penalty is assessed far too frequently and it should be very rare.  But his is the rare case where I can agree with it.  Sitting on the bench for thirty years and ONLY opting for the death penalty for Grell?  That's about where I am on this.  Only very rare, and horrendously evil cases.

Beyond the requirement that a crime must be unthinkably heinous,  I also do not think the death penalty should be imposed if there is clear evidence that it is what the defendant wants. A good case in point is that of Major Nidal Hassan, who murdered thirteen people at Fort Hood in his pursuit of martyrdom on behalf of Allah.  Only an odd thing happened to Major Hassan. Instead of dying a martyr's death as he had planned, he was cut down by a policewoman whose bullet severed his spine, stopping his rampage and leaving him permanently paralyzed and in a wheelchair.  During the trial, it became very clear that Major Hassan and prosecutors were on the same page.  He wanted to be a martyr and die, and they wanted him to die.  His defense attorneys were in the ridiculous position of arguing a position that is based on the presumption that the defendant seeks to avoid the death penalty, even though in that case it wasn't true. The prosecution, much to the joy of the defendant, prevailed. He will be executed, rather than spending decades in that wheelchair having the daily reminder of what he did.  He thinks he will get 72 virgins when he is executed.  Whether he is right or wrong becomes a matter of blind faith.

The second point is that the system is broken, as evidenced by the number of innocent people sentenced to death. Quite a few years ago a man named Ray Krone, who had been on death row here in Arizona, was exonerated after DNA evidence proved he had nothing to do with the crime. His case was remarkable only in that he was the 100th person who had been sentenced to death, to be exonerated since the death penalty was reinstated in 1977 after a moratorium. Dozens more across the country have since been cleared.  By some estimates as many as 5% (or one out of twenty) people on death row may actually be innocent.  Even if it is lower than that, the number who have been proven to be innocent after being convicted and sentenced to die is far too high for comfort. It is true that there is no proof that an innocent person has actually been executed since the reinstatement of the penalty but there are cases such as Joseph O'Dell in Virginia and Cameron Todd Willingham in Texas in which it seems quite likely.  Of course prosecutors have vigorously fought any attempt to reopen cases of people who have already been executed.  But given the number of people who have been sentenced to death and later released after being exonerated it is statistically very likely that at least a few innocent people may well have been executed.  If we ever agree that this is 'acceptable' then we really are a morally bankrupt society, as death penalty opponents claim.

This leads directly into the third point, that the justice system is not an even playing field. The amount of money a defendant can spend on legal representation dictates the quality of defense he or she is likely to receive.  We all remember the O.J. Simpson murder trial.  Simpson, at the time a deep pocketed millionaire, was able to hire a virtual Who's Who of the nation's best lawyers.  The limited resources available to the L.A. County prosecutor's office just weren't enough to keep up with the demands of the case.  Simpson got off, as we may recall the words, "If the glove doesn't fit, you must acquit."  Further, even a moderately wealthy defendant can afford a good enough lawyer to probably avoid the death penalty (there are lawyers who specialize in just such cases and have a very good track record of helping their clients dodge the executioner's table even when found guilty.)  A good example is Judy Clarke, who is just now representing Boston bombing suspect Dzokhar Tsarnaev;  in the past she has represented Unabomber Ted Kaczynski, South Carolina mother Susan Smith (who drowned her sons,) Olympic Park bomber Eric Robert Rudolph and Tucson shooter Jared Loughner;  all were found guilty, as the defense is already conceding about Tsarnaev, but she helped all four of them avoid the death penalty.  If a suspect is convicted and sentenced to death, they can further appeal the sentence, to the point where strained county prosecutor's budgets just aren't there to play the game out. Even going for a death sentence is very expensive, and in an era of budget cuts for prosecutor's offices that may well explain why so many fewer prosecutors are even trying for it anymore than the number of cases where they used to.

However, the unequal playing field in which a very wealthy (or in the case of Tsarnaev, very notorious, who can bring out a lawyer like Clarke) defendant against a state with limited taxpayer supplied funds to spread around, is reversed when the resources of the state are pitted against an indigent or very poor defendant.  Often these people are represented by a public defender.  Now, don't get me wrong.  There are some very good public defenders (in fact Clarke herself is a former public defender, which is how she got the Kaczynski case.)  Some public defenders are true professionals who take their jobs very seriously. At the same time however, there are also some who are the opposite. There are some lawyers who are just too inept to be hired by any reputable law firm, and often end up as public defenders.  In 2000 the Dallas Morning news found that nearly one out of four death row inmates in Texas had been represented by public defenders who in the past had been disciplined for professional misconduct.  Often this involved things like sleeping or drinking on the job. Some public defenders haven't won a case in years.

Further, even if a public defender is committed to the job, he or she has a heavy workload (so not much time to spend on each defendant) and a budget that is even more limited than the prosecutor's budget.  It takes money to do things like run a DNA test or go interview a witness, and often the money just isn't there in a public defender's budget.  This may be one reason why for example, 95% of death row inmates in Alabama are indigent (page 8 of the link)  but no one would suggest that anywhere near 95% of the murders in Alabama are committed by indigent people.  The obvious next question is how many of them may in fact be innocent, but we are unlikely to know because public defenders typically don't handle appeals and none of them has the money for an appeal, even if they could prove incompetent representation at the outset.  Until COMPETENT legal representation WITH ENOUGH RESOURCES to do the job properly can be provided for everyone who can't otherwise pay, I can't with good conscience support a system where whether one is convicted and receives a death sentence may depend as much on income level as on actual guilt or innocence, or the details of the crime.

There is also a well-documented by now correlation between race and application of the death penalty, even when factors such as the specific nature of the crime, number of victims, aggravating factors, etc. are taken in to account.  In other words, in cases with comparable crimes. blacks are more likely than whites to receive the death penalty. While this study only compares blacks and whites, there are other studies that show that for comparable crimes minority perpetrators are more likely to get a harsher sentence (whether jail for jaywalking or death for murder) than the identical crimes perpetrated by whites.  How much of this is already explained by the previously noted correlation between income level and sentencing outcome is an open debate;  but it is unlikely that 100% of this difference is only due to that factor; so in other words conscious or subconscious racism could also play a role.

Beyond that, there are some arguments in favor of the death penalty that I find specious.  One is that it is a deterrent. However, most murderers, especially those who premeditate murder, expect to get away with it.  I've heard that from many people who would be in a position to know, including police officers. People who plan murder think they are smarter or shrewder and in most cases just don't expect to be caught. So the penalty is of little concern to them if they think they have a plan to get away with it.  Secondly, in many cases people who have for example, shot at people are later killed in shootouts with police. Now, there are probably faster ways to guarantee your instant death than pointing a gun at a police officer, but right now I can't think of one.  Clearly these folks don't care if they live or die, if they can just seize on the smallest chance of escape. And finally we have evidence it is not a deterrent;  states without the death penalty actually have a LOWER homicide rates than states that do have it.  I've even heard the counter argument, that in states with the death penalty the state makes life 'cheaper' so people are more likely to take it themselves.  I don't actually believe that, but there is a stronger statistical case to be made for that point of view than there is to be made for the argument that it's a deterrent.

Another of the what I consider specious arguments has to do with the well-documented problem of prison overcrowding. However, at least as of a couple of years ago the prison population was growing so fast that if you lined everyone on death row up against a wall and shot them tomorrow, in less than two weeks the prisons would be just as full  as they are today.  In other words, death row is an insignificant part of the problem.  I fully support prison reform, but that has to begin with non-violent offenders (especially drug addicts) who are in prison rather than in a treatment facility where they belong, as well as mental health patients who also should be getting treatment, not a prison cell.  But worrying about the vanishingly small number on death row in the face of a sizeable segment of the population that is behind bars is at best a diversion from what is a real problem of mass incarceration in America today.

This does however bring up the question of money.  Even though death row is a tiny part of the prison system, most states are in fact struggling under the burden of keeping this many people locked up. So the argument has been made that executing a prisoner frees up a bed and should reduce costs.  However, largely owing to the cost of appeals and obtaining experimental drugs, in fact it is more expensive to execute an inmate than it is to keep them in prison for life.  So still not a good argument for the death penalty, even if you think cost is a good basis for making this decision.

So for me to support the death penalty I'd have to see these problems addressed in a way that would make being subject to the death penalty applied in a manner that is fair and equitable. If it is applied in a capricious manner as it is now then I can't support it.  AND once the system is fixed, I would still only support it for very specific and unspeakably monstrous crimes, such as Grell ruminating on the idea while he drove around for nearly an hour and then burning his two year old to death. Which brings me back to Jodi Arias.  Apparently eleven of the twelve jurors supported the death penalty for Arias, but the twelfth refused to go along with them.  Well, I'm with the twelfth juror.  There is no question that Arias' crime, stabbing Alexander as many as 29 times plus a gunshot wound to the head, was as brutal as it was bloody.  It can be argued that she could have premeditated the crime, but there is also evidence that the two of them had sex shortly before the murder.  So do we know for sure everything that happened? Not absolutely. The jury that heard the evidence did convict her of capital murder. And I believe they were right to convict her.  But I do not believe that we can be sure that she didn't in fact, 'snap' (as she said at one point, though she certainly damaged her own credibility by changing her story several times.)  So I'm not sure that Arias' crime meets my own standards for when I could support the death penalty (see above: almost never, just not absolutely never.)  Her spending the rest of her years wishing she hadn't done it, is good enough.

Wednesday, October 15, 2014

All Hat, no Cattle

Have you ever had the experience of hearing somebody claim to be the exact opposite of what they are?

It can be jarring, but that's hardly surprising from Andy Tobin, the speaker of the Arizona legislature. Tobin has been wearing a new hat lately to try and convince voters in CD-1 that he fits into rural Arizona despite the fact that he doesn't actually live in the district and spends most of his time in Phoenix.  So I suppose I shouldn't have been surprised to hear Andy Tobin tout his 'bipartisanship' in a debate this week with Congresswoman Ann Kirkpatrick. He even had a statistic, claiming that 90% of what was passed by his legislature was 'bipartisan.'

In fact, if you were to lift the brim up and take a peek under Andy's new hat you will find a baldly partisan speaker.    Democrats have routinely been shut out of negotiations, denied the opportunity to offer amendments either in committee or on the floor,  and even been cut off to prevent them from speaking on legislation.

As for the 90% number, it is little secret that most bills passed by any legislative body are non-controversial, and will be passed unanimously or nearly unanimously.  Typical of this type of bill might (just for example) be HB 2307 clarifying the rules for driving golf carts.  It passed the House (and Senate) unanimously, as did numerous technical clarifications, memorials and resolutions (after all, who would vote against HR 2008, designating the first Friday in September as ovarian cancer awareness day?) 

Counting these sorts of bills helps mask the truly partisan nature of the Tobin legislature.  All of the important bills (such as HB 2305 last year, the voter suppression bill, or SB 1062 which would have allowed discrimination on the grounds of 'religious freedom' or the past few years' budgets which slashed hundreds of millions of dollars from education) you would find that all of them were written and sponsored by only Republicans and passed with only Republican votes. Which is exactly the way Andy Tobin wanted it.  As Speaker he had the right to hold a bill or get everyone on board but he put those bills on the floor anyway for a strict party-line vote. He does have that right since his party controls the legislature and he controls his party, but don't call him 'bipartisan' because he is NOT bipartisan. Not at all.

If you want 'bipartisan' where it counts, then look at the congresswoman he is trying to replace, Rep. Ann Kirkpatrick.  As most people know or should know, Kirkpatrick has put aside differences with Republican congressman Paul Gosar (the man who defeated her in 2010) and worked on moving a mine project forward that promises to deliver thousands of jobs.  Recently, in a Congress that is so warped by partisanship and divided control of the government that it has literally set a record for getting very little done (no Congress back to the founding of the Republic has passed into law fewer bills) it was Ann Kirkpatrick who became the first member of the Arizona delegation to do the ridiculously hard work of writing a bill that both parties could sign onto and shepherd it through the house and the Senate so that it eventually could be signed by the President. The bill improves service at the Veterans' Administration.  In the past, that might not have been that hard to pass but this year, with everything as a political football, it shows Rep. Kirkpatrick's doggedness and determination to do the work to get something done instead of political posturing. More recently, Rep. Kirkpatrick issued a press release  opposing publically the EPA's new proposed regulations on coal burning power plants.  And while Rep. Kirkpatrick has continued to support the Affordable Care Act, she has been among the first to suggest that it can and should be improved.

Further, some may recall that Republicans made commercials saying that Kirkpatrick voted '88% of the time' with Nancy Pelosi.  This is the other side of the coin we referred to above in regard to Andy Tobin's claim that his legislature is '90% bipartisan.'  Congress too, passes a lot of non-controversial bills over stuff like naming post offices or remembering somebody's service (I wonder if  a vote to adjourn is counted in their 88% statistic?)  But on the bills that Ann Kirkpatrick has differed on, they are substantive bills, but bills that matter to the district (for example she opposed bank bailouts and cap-and-trade legislation because this is a district where energy production is a lot more important to the local economy than Wall Street.)

And therein is the difference. Does anyone expect that Andy Tobin will reach across the aisle on VOTES THAT REALLY MATTER?  I don't.  Ann Kirkpatrick however does have the courage to do so when it will benefit her constituents.

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