Thursday, November 29, 2007

Feds' budget tricks hide trillions in debt

Feds' budget tricks hide trillions in debt
Every year, tens or even hundreds of billions of dollars are quietly added to the national debt -- on top of the deficits that we hear about. What's going on here?

When it comes to financial magic, the government of the United States takes the prize. Sleights of hand and clever distractions by purveyors of line-of-credit mortgages, living-benefit variable annuities and equity-indexed life insurance are clumsy parlor tricks compared with the Big Magic of American politicians.
Consider the proud trumpeting that came from Washington at the close of fiscal 2007. The deficit for the unified budget was, politicians crowed, down to a mere $162.8 billion.

In fact, our government is overspending at a far greater rate. The total federal debt actually increased by $497.1 billion over the same period.
But politicians of both parties use happy numbers to distract us. Democrats routinely criticize the Republican administration for crippling deficits, but they politely use the least-damaging figure, the $162.8 billion. Why? Because references to more-realistic accounting would reveal vastly greater numbers and implicate both parties.

You can understand how this is done by taking a close look at a single statement on federal finance from the president's Council of Economic Advisers. The September statement shows that the "on-budget" numbers produced a deficit of $344.3 billion in fiscal 2007. The "off-budget" numbers had a surplus of $181.5 billion. (The off-budget figures are dominated by Social Security, Medicare and other programs with trust funds.)
Combine those two figures and you get the unified budget, that $162.8 billion. In the past eight years we've had two years of reported surpluses and six years of reported deficits. Altogether, the total reported deficit has run $1.3 trillion.
Some numbers don't add up But if you examine another figure, the gross federal debt, you'll see something strange. First, the debt has increased in each of the past eight years, even in the two years when surpluses were reported. Second, the gross federal debt, which includes the obligations held by the Social Security and Medicare trust funds, has increased much faster than the deficits -- about $3.3 trillion over the same eight years.
That's $2 trillion more than the reported $1.3 trillion in deficits over the period. Can you spell "Enron"?

In other words, while our reported deficits averaged $164 billion over the past eight years, government debt increased an average of $418 billion a year. That's a lot more than twice as much.
How could this happen?
Easy. The Treasury Department simply credits the Social Security, Medicare and other trust funds with interest payments in the form of new Treasury obligations. No cash is actually paid. The trust funds magically increase in value with a bookkeeping entry. It represents money the government owes itself.
So what happens if we take out the funny money?
When the imaginary interest payments are included, Social Security and Medicare are running at a tranquilizing surplus (that $181.5 billion mentioned earlier). But measure actual cash, and the surplus disappears.

How to control deficit spendingU.S. Rep. Tom Tancredo, R-Colo., says Social Security and Medicare are the keys to cutting federal budget deficits.
In 2005, for instance, the Social Security Disability Income program started to run at a cash loss. 2007 is the first year that Medicare Part A (the hospital insurance program) benefits exceeded income.
The same thing will happen to the Social Security retirement-income program in six to nine years, depending on which of the trustees' estimates you use. During the same period, the expenses of Medicare Part B and Part D, which are paid out of general tax revenue, will rise rapidly.
Despite this, the Social Security Administration writes workers every year advising them that the program will have a problem 34 years from now, not six or nine years. In fact, the real problem is already here. It will be a big-time problem in less than a decade.
Count on it.

Federal deficits versus increases in the federal debt
Fiscal year
Reported surplus/deficit
Debt increase
Debt at start of year
Debt at year's end
$236.2 billion surplus
$23.2 billion
$5.606 trillion
$5.629 trillion
$128.2 billion surplus
$141.2 billion
$5.629 trillion
$5.770 trillion
$157.8 billion deficit
$428.5 billion
$5.770 trillion
$6.198 trillion
$377.6 billion deficit
$561.6 billion
$6.198 trillion
$6.760 trillion
$412.7 billion deficit
$594.7 billion
$6.760 trillion
$7.355 trillion
$318.3 billion deficit
$550.6 billion
$7.355 trillion
$7.905 trillion
$248.2 billion deficit
$546.1 billion
$7.905 trillion
$8.451 trillion
$162.8 billion deficit
$497.1 billion
$8.451 trillion
$8.949 trillion

How's that working for ya?

Wednesday, November 28, 2007

Idiot Corporate Looters Strike Retirement Gold

The 5 richest payoffs for fired CEOs
Many axed CEOs depart their troubled companies with millions of dollars in cash, stock and options -- like Merrill Lynch's Stanley O'Neal did last month. Here are five who stand atop this golden goodbye club.
The sweetest sound on Wall Street these days? "You're fired."
Regular folks may get a modest pension or maybe just a box for their personal items. But for Wall Street CEOs, the exit sign needs at least eight digits.
The latest example is the $161.5 million retirement package collected by former Merrill Lynch (MER, news, msgs) chief Stanley O'Neal on his way out the doors of the troubled brokerage last month.
On O'Neal's watch, Merrill cranked out risky debt instruments backed by dodgy subprime mortgages. Then last month, O'Neal left the brokerage amid revelations of Merrill's heavy exposure to the imploding mortgage market.

Despite all the problems that developed while he was at the helm, he will benefit nicely if his successors can clean up the mess. Most of the value of O'Neal's golden goodbye comes in the form of restricted stock and stock options. But astonishingly, unlike options or stock grants that are wiped out or expire quickly for regular employees when they leave to "spend more time with the family," O'Neal's awards will continue to vest for years to come under a timetable set years ago.

The big 5

O'Neal, of course, is not the sole member of the exclusive corner office golden goodbye club. Paul Hodgson, a CEO pay expert at The Corporate Library, estimates that getting rid of the CEOs at 16 investment banks and financial institutions that potentially have the biggest exposure to the subprime mess would cost an astonishing $1 billion, including O'Neal's take. Angelo Mozilo, who as co-founder and chief of mortgage lender Countrywide Financial (CFC, news, msgs) bears a good bit of the blame for the current subprime mess, would collect more than $73 million, according to Hodgson.
As big as O'Neal's $161.5 million "retirement package" was, he ranks only fifth in the golden goodbye club so far this millennium. Below are the other CEOs who got even more loot than him on the way out the door, with numbers courtesy of an Oct. 31 Corporate Library research note on this problem called "Too Little, Too Late."
No. 4: Ex-Gillette chief James Kilts. Total retirement take: $165 million.
It's been more than two years since Procter & Gamble (PG, news, msgs) took over Gillette, putting Gillette CEO James Kilts out of a job. A lot of CEOs have left their corner offices since then, but Kilts' golden goodbye was so huge it still takes the No. 4 slot for the all-time biggest retirement payouts this millennium. His take: $165 million, including a $13 million "gross-up" payment to help cover taxes triggered by a golden parachute. In response to criticism in the local press for this huge retirement cash-out, Kilts described himself as "Boston's piñata" and argued that he earned the pay by creating billions of dollars in shareholder wealth.
Continued: Home Depot's former CEO
No. 3: Former Home Depot CEO Robert Nardelli. Total retirement take: $210 million.
The sheer size of former Home Depot (HD, news, msgs) CEO Robert Nardelli's golden goodbye sparked outrage on many fronts when he left the company in early 2007. First, Home Depot stock declined nearly 8% under his six-year watch. Next, he got all the loot even though he had already collected huge sums in annual pay -- including $219.7 million in the two years before leaving the company, according to The Corporate Library.
Finally, $84 million of his golden goodbye came in the form of accelerated vesting of deferred stock awards and grants of unvested options, according to the AFL-CIO Office of Investment. So just like Merrill's O'Neal -- but unlike most rank-and-file employees -- Nardelli got to keep his restricted stock and options and will gain if his successor, Frank Blake, manages to turn Home Depot around and make its stock go up.
No. 2: Former Pfizer boss Henry McKinnell. Total retirement take: $213 million.
Under Henry McKinnell's watch from early 2001 through 2006, the shares of Pfizer (PFE, news, msgs) declined 40%. That cost shareholders $140 billion. No matter. He still left the CEO slot in July 2006 with a $213 million golden goodbye, thanks to an extremely generous board.
While private-sector pensions typically replace 20% to 35% of salary, the value of McKinnell's pension worked out to about $6.5 million a year, or 100% of his annual salary and bonus before leaving, according to the AFL-CIO. He actually took it in the form of an $82 million lump sum, part of that $213 million total.
No. 1: Former ExxonMobil boss Lee Raymond. Total retirement take: $351 million.
Given the strength in energy stocks since 2000, it probably comes as no surprise that the richest golden goodbye this millennium went to Lee Raymond, who retired as CEO of ExxonMobil (XOM, news, msgs) in 2006. He got $351 million. That's a lot for a guy who earned $70 million in his last year of work, or $34,457 an hour, according to The Corporate Library. His cash-out included a $98.4 million lump-sum pension payment.
ExxonMobil stock advanced nearly fourfold during the 13 years he served as CEO, so supporters argued he earned the money. However, much of that advance was linked to a broad rise in energy stocks as oil prices advanced sharply in the past several years. Should Raymond really get credit for that?
What you can do If any of this ticks you off, there are a couple of things you can do. First, if you own stock, watch closely for proxy votes during the shareholder meeting season. Two of the most popular shareholder resolutions these days call for limits on severance pay and "say on pay," in which shareholders vote thumbs up or thumbs down on company compensation reports. These votes aren't binding, but they send a message.

Next, if you have a political bent, you can ask your representatives to support legislators like Rep. Barney Frank, D-Mass., who are working on bills that would require public companies to have these votes on severance pay and "say on pay" votes.

Finally, contact the Securities and Exchange Commission and support changes in rules that would allow shareholders to have more proxy access to change company bylaws. This kind of leeway could allow shareholder activists to change the way board members are voted on -- so it's easier to boot out the ones who consistently buckle to executive demands for higher pay.

Tuesday, November 13, 2007

The Economic Consequences of Mr. Bush

The Economic Consequences of Mr. Bush

The next president will have to deal with yet another crippling legacy of George W. Bush: the economy. A Nobel laureate, Joseph E. Stiglitz, sees a generation-long struggle to recoup.
by Joseph E. Stiglitz December 2007

When we look back someday at the catastrophe that was the Bush administration, we will think of many things: the tragedy of the Iraq war, the shame of Guantánamo and Abu Ghraib, the erosion of civil liberties. The damage done to the American economy does not make front-page headlines every day, but the repercussions will be felt beyond the lifetime of anyone reading this page.
I can hear an irritated counterthrust already. The president has not driven the United States into a recession during his almost seven years in office. Unemployment stands at a respectable 4.6 percent. Well, fine. But the other side of the ledger groans with distress: a tax code that has become hideously biased in favor of the rich; a national debt that will probably have grown 70 percent by the time this president leaves Washington; a swelling cascade of mortgage defaults; a record near-$850 billion trade deficit; oil prices that are higher than they have ever been; and a dollar so weak that for an American to buy a cup of coffee in London or Paris—or even the Yukon—becomes a venture in high finance.
And it gets worse. After almost seven years of this president, the United States is less prepared than ever to face the future. We have not been educating enough engineers and scientists, people with the skills we will need to compete with China and India. We have not been investing in the kinds of basic research that made us the technological powerhouse of the late 20th century. And although the president now understands—or so he says—that we must begin to wean ourselves from oil and coal, we have on his watch become more deeply dependent on both.
Up to now, the conventional wisdom has been that Herbert Hoover, whose policies aggravated the Great Depression, is the odds-on claimant for the mantle "worst president" when it comes to stewardship of the American economy. Once Franklin Roosevelt assumed office and reversed Hoover’s policies, the country began to recover. The economic effects of Bush’s presidency are more insidious than those of Hoover, harder to reverse, and likely to be longer-lasting. There is no threat of America’s being displaced from its position as the world’s richest economy. But our grandchildren will still be living with, and struggling with, the economic consequences of Mr. Bush.
Remember the Surplus?
The world was a very different place, economically speaking, when George W. Bush took office, in January 2001. During the Roaring 90s, many had believed that the Internet would transform everything. Productivity gains, which had averaged about 1.5 percent a year from the early 1970s through the early 90s, now approached 3 percent. During Bill Clinton’s second term, gains in manufacturing productivity sometimes even surpassed 6 percent. The Federal Reserve chairman, Alan Greenspan, spoke of a New Economy marked by continued productivity gains as the Internet buried the old ways of doing business. Others went so far as to predict an end to the business cycle. Greenspan worried aloud about how he’d ever be able to manage monetary policy once the nation’s debt was fully paid off.
This tremendous confidence took the Dow Jones index higher and higher. The rich did well, but so did the not-so-rich and even the downright poor. The Clinton years were not an economic Nirvana; as chairman of the president’s Council of Economic Advisers during part of this time, I’m all too aware of mistakes and lost opportunities. The global-trade agreements we pushed through were often unfair to developing countries. We should have invested more in infrastructure, tightened regulation of the securities markets, and taken additional steps to promote energy conservation. We fell short because of politics and lack of money—and also, frankly, because special interests sometimes shaped the agenda more than they should have. But these boom years were the first time since Jimmy Carter that the deficit was under control. And they were the first time since the 1970s that incomes at the bottom grew faster than those at the top—a benchmark worth celebrating.
By the time George W. Bush was sworn in, parts of this bright picture had begun to dim. The tech boom was over. The nasdaq fell 15 percent in the single month of April 2000, and no one knew for sure what effect the collapse of the Internet bubble would have on the real economy. It was a moment ripe for Keynesian economics, a time to prime the pump by spending more money on education, technology, and infrastructure—all of which America desperately needed, and still does, but which the Clinton administration had postponed in its relentless drive to eliminate the deficit. Bill Clinton had left President Bush in an ideal position to pursue such policies. Remember the presidential debates in 2000 between Al Gore and George Bush, and how the two men argued over how to spend America’s anticipated $2.2 trillion budget surplus? The country could well have afforded to ramp up domestic investment in key areas. In fact, doing so would have staved off recession in the short run while spurring growth in the long run.
But the Bush administration had its own ideas. The first major economic initiative pursued by the president was a massive tax cut for the rich, enacted in June of 2001. Those with incomes over a million got a tax cut of $18,000—more than 30 times larger than the cut received by the average American. The inequities were compounded by a second tax cut, in 2003, this one skewed even more heavily toward the rich. Together these tax cuts, when fully implemented and if made permanent, mean that in 2012 the average reduction for an American in the bottom 20 percent will be a scant $45, while those with incomes of more than $1 million will see their tax bills reduced by an average of $162,000.
The administration crows that the economy grew—by some 16 percent—during its first six years, but the growth helped mainly people who had no need of any help, and failed to help those who need plenty. A rising tide lifted all yachts. Inequality is now widening in America, and at a rate not seen in three-quarters of a century. A young male in his 30s today has an income, adjusted for inflation, that is 12 percent less than what his father was making 30 years ago. Some 5.3 million more Americans are living in poverty now than were living in poverty when Bush became president. America’s class structure may not have arrived there yet, but it’s heading in the direction of Brazil’s and Mexico’s.
The Bankruptcy Boom
In breathtaking disregard for the most basic rules of fiscal propriety, the administration continued to cut taxes even as it undertook expensive new spending programs and embarked on a financially ruinous "war of choice" in Iraq. A budget surplus of 2.4 percent of gross domestic product (G.D.P.), which greeted Bush as he took office, turned into a deficit of 3.6 percent in the space of four years. The United States had not experienced a turnaround of this magnitude since the global crisis of World War II.
Agricultural subsidies were doubled between 2002 and 2005. Tax expenditures—the vast system of subsidies and preferences hidden in the tax code—increased more than a quarter. Tax breaks for the president’s friends in the oil-and-gas industry increased by billions and billions of dollars. Yes, in the five years after 9/11, defense expenditures did increase (by some 70 percent), though much of the growth wasn’t helping to fight the War on Terror at all, but was being lost or outsourced in failed missions in Iraq. Meanwhile, other funds continued to be spent on the usual high-tech gimcrackery—weapons that don’t work, for enemies we don’t have. In a nutshell, money was being spent everyplace except where it was needed. During these past seven years the percentage of G.D.P. spent on research and development outside defense and health has fallen. Little has been done about our decaying infrastructure—be it levees in New Orleans or bridges in Minneapolis. Coping with most of the damage will fall to the next occupant of the White House.
Although it railed against entitlement programs for the needy, the administration enacted the largest increase in entitlements in four decades—the poorly designed Medicare prescription-drug benefit, intended as both an election-season bribe and a sop to the pharmaceutical industry. As internal documents later revealed, the true cost of the measure was hidden from Congress. Meanwhile, the pharmaceutical companies received special favors. To access the new benefits, elderly patients couldn’t opt to buy cheaper medications from Canada or other countries. The law also prohibited the U.S. government, the largest single buyer of prescription drugs, from negotiating with drug manufacturers to keep costs down. As a result, American consumers pay far more for medications than people elsewhere in the developed world.
You’ll still hear some—and, loudly, the president himself—argue that the administration’s tax cuts were meant to stimulate the economy, but this was never true. The bang for the buck—the amount of stimulus per dollar of deficit—was astonishingly low. Therefore, the job of economic stimulation fell to the Federal Reserve Board, which stepped on the accelerator in a historically unprecedented way, driving interest rates down to 1 percent. In real terms, taking inflation into account, interest rates actually dropped to negative 2 percent. The predictable result was a consumer spending spree. Looked at another way, Bush’s own fiscal irresponsibility fostered irresponsibility in everyone else. Credit was shoveled out the door, and subprime mortgages were made available to anyone this side of life support. Credit-card debt mounted to a whopping $900 billion by the summer of 2007. "Qualified at birth" became the drunken slogan of the Bush era. American households took advantage of the low interest rates, signed up for new mortgages with "teaser" initial rates, and went to town on the proceeds.
All of this spending made the economy look better for a while; the president could (and did) boast about the economic statistics. But the consequences for many families would become apparent within a few years, when interest rates rose and mortgages proved impossible to repay. The president undoubtedly hoped the reckoning would come sometime after 2008. It arrived 18 months early. As many as 1.7 million Americans are expected to lose their homes in the months ahead. For many, this will mean the beginning of a downward spiral into poverty.
Between March 2006 and March 2007 personal-bankruptcy rates soared more than 60 percent. As families went into bankruptcy, more and more of them came to understand who had won and who had lost as a result of the president’s 2005 bankruptcy bill, which made it harder for individuals to discharge their debts in a reasonable way. The lenders that had pressed for "reform" had been the clear winners, gaining added leverage and protections for themselves; people facing financial distress got the shaft.
And Then There’s Iraq
The war in Iraq (along with, to a lesser extent, the war in Afghanistan) has cost the country dearly in blood and treasure. The loss in lives can never be quantified. As for the treasure, it’s worth calling to mind that the administration, in the run-up to the invasion of Iraq, was reluctant to venture an estimate of what the war would cost (and publicly humiliated a White House aide who suggested that it might run as much as $200 billion). When pressed to give a number, the administration suggested $50 billion—what the United States is actually spending every few months. Today, government figures officially acknowledge that more than half a trillion dollars total has been spent by the U.S. "in theater." But in fact the overall cost of the conflict could be quadruple that amount—as a study I did with Linda Bilmes of Harvard has pointed out—even as the Congressional Budget Office now concedes that total expenditures are likely to be more than double the spending on operations. The official numbers do not include, for instance, other relevant expenditures hidden in the defense budget, such as the soaring costs of recruitment, with re-enlistment bonuses of as much as $100,000. They do not include the lifetime of disability and health-care benefits that will be required by tens of thousands of wounded veterans, as many as 20 percent of whom have suffered devastating brain and spinal injuries. Astonishingly, they do not include much of the cost of the equipment that has been used in the war, and that will have to be replaced. If you also take into account the costs to the economy from higher oil prices and the knock-on effects of the war—for instance, the depressing domino effect that war-fueled uncertainty has on investment, and the difficulties U.S. firms face overseas because America is the most disliked country in the world—the total costs of the Iraq war mount, even by a conservative estimate, to at least $2 trillion. To which one needs to add these words: so far.
It is natural to wonder, What would this money have bought if we had spent it on other things? U.S. aid to all of Africa has been hovering around $5 billion a year, the equivalent of less than two weeks of direct Iraq-war expenditures. The president made a big deal out of the financial problems facing Social Security, but the system could have been repaired for a century with what we have bled into the sands of Iraq. Had even a fraction of that $2 trillion been spent on investments in education and technology, or improving our infrastructure, the country would be in a far better position economically to meet the challenges it faces in the future, including threats from abroad. For a sliver of that $2 trillion we could have provided guaranteed access to higher education for all qualified Americans.
The soaring price of oil is clearly related to the Iraq war. The issue is not whether to blame the war for this but simply how much to blame it. It seems unbelievable now to recall that Bush-administration officials before the invasion suggested not only that Iraq’s oil revenues would pay for the war in its entirety—hadn’t we actually turned a tidy profit from the 1991 Gulf War?—but also that war was the best way to ensure low oil prices. In retrospect, the only big winners from the war have been the oil companies, the defense contractors, and al-Qaeda. Before the war, the oil markets anticipated that the then price range of $20 to $25 a barrel would continue for the next three years or so. Market players expected to see more demand from China and India, sure, but they also anticipated that this greater demand would be met mostly by increased production in the Middle East. The war upset that calculation, not so much by curtailing oil production in Iraq, which it did, but rather by heightening the sense of insecurity everywhere in the region, suppressing future investment.
The continuing reliance on oil, regardless of price, points to one more administration legacy: the failure to diversify America’s energy resources. Leave aside the environmental reasons for weaning the world from hydrocarbons—the president has never convincingly embraced them, anyway. The economic and national-security arguments ought to have been powerful enough. Instead, the administration has pursued a policy of "drain America first"—that is, take as much oil out of America as possible, and as quickly as possible, with as little regard for the environment as one can get away with, leaving the country even more dependent on foreign oil in the future, and hope against hope that nuclear fusion or some other miracle will come to the rescue. So many gifts to the oil industry were included in the president’s 2003 energy bill that John McCain referred to it as the "No Lobbyist Left Behind" bill.
Contempt for the World
America’s budget and trade deficits have grown to record highs under President Bush. To be sure, deficits don’t have to be crippling in and of themselves. If a business borrows to buy a machine, it’s a good thing, not a bad thing. During the past six years, America—its government, its families, the country as a whole—has been borrowing to sustain its consumption. Meanwhile, investment in fixed assets—the plants and equipment that help increase our wealth—has been declining.
What’s the impact of all this down the road? The growth rate in America’s standard of living will almost certainly slow, and there could even be a decline. The American economy can take a lot of abuse, but no economy is invincible, and our vulnerabilities are plain for all to see. As confidence in the American economy has plummeted, so has the value of the dollar—by 40 percent against the euro since 2001.
The disarray in our economic policies at home has parallels in our economic policies abroad. President Bush blamed the Chinese for our huge trade deficit, but an increase in the value of the yuan, which he has pushed, would simply make us buy more textiles and apparel from Bangladesh and Cambodia instead of China; our deficit would remain unchanged. The president claimed to believe in free trade but instituted measures aimed at protecting the American steel industry. The United States pushed hard for a series of bilateral trade agreements and bullied smaller countries into accepting all sorts of bitter conditions, such as extending patent protection on drugs that were desperately needed to fight aids. We pressed for open markets around the world but prevented China from buying Unocal, a small American oil company, most of whose assets lie outside the United States.
Not surprisingly, protests over U.S. trade practices erupted in places such as Thailand and Morocco. But America has refused to compromise—refused, for instance, to take any decisive action to do away with our huge agricultural subsidies, which distort international markets and hurt poor farmers in developing countries. This intransigence led to the collapse of talks designed to open up international markets. As in so many other areas, President Bush worked to undermine multilateralism—the notion that countries around the world need to cooperate—and to replace it with an America-dominated system. In the end, he failed to impose American dominance—but did succeed in weakening cooperation.
The administration’s basic contempt for global institutions was underscored in 2005 when it named Paul Wolfowitz, the former deputy secretary of defense and a chief architect of the Iraq war, as president of the World Bank. Widely distrusted from the outset, and soon caught up in personal controversy, Wolfowitz became an international embarrassment and was forced to resign his position after less than two years on the job.
Globalization means that America’s economy and the rest of the world have become increasingly interwoven. Consider those bad American mortgages. As families default, the owners of the mortgages find themselves holding worthless pieces of paper. The originators of these problem mortgages had already sold them to others, who packaged them, in a non-transparent way, with other assets, and passed them on once again to unidentified others. When the problems became apparent, global financial markets faced real tremors: it was discovered that billions in bad mortgages were hidden in portfolios in Europe, China, and Australia, and even in star American investment banks such as Goldman Sachs and Bear Stearns. Indonesia and other developing countries—innocent bystanders, really—suffered as global risk premiums soared, and investors pulled money out of these emerging markets, looking for safer havens. It will take years to sort out this mess.
Meanwhile, we have become dependent on other nations for the financing of our own debt. Today, China alone holds more than $1 trillion in public and private American I.O.U.’s. Cumulative borrowing from abroad during the six years of the Bush administration amounts to some $5 trillion. Most likely these creditors will not call in their loans—if they ever did, there would be a global financial crisis. But there is something bizarre and troubling about the richest country in the world not being able to live even remotely within its means. Just as Guantánamo and Abu Ghraib have eroded America’s moral authority, so the Bush administration’s fiscal housekeeping has eroded our economic authority.
The Way Forward
Whoever moves into the White House in January 2009 will face an unenviable set of economic circumstances. Extricating the country from Iraq will be the bloodier task, but putting America’s economic house in order will be wrenching and take years.
The most immediate challenge will be simply to get the economy’s metabolism back into the normal range. That will mean moving from a savings rate of zero (or less) to a more typical savings rate of, say, 4 percent. While such an increase would be good for the long-term health of America’s economy, the short-term consequences would be painful. Money saved is money not spent. If people don’t spend money, the economic engine stalls. If households curtail their spending quickly—as they may be forced to do as a result of the meltdown in the mortgage market—this could mean a recession; if done in a more measured way, it would still mean a protracted slowdown. The problems of foreclosure and bankruptcy posed by excessive household debt are likely to get worse before they get better. And the federal government is in a bind: any quick restoration of fiscal sanity will only aggravate both problems.
And in any case there’s more to be done. What is required is in some ways simple to describe: it amounts to ceasing our current behavior and doing exactly the opposite. It means not spending money that we don’t have, increasing taxes on the rich, reducing corporate welfare, strengthening the safety net for the less well off, and making greater investment in education, technology, and infrastructure.
When it comes to taxes, we should be trying to shift the burden away from things we view as good, such as labor and savings, to things we view as bad, such as pollution. With respect to the safety net, we need to remember that the more the government does to help workers improve their skills and get affordable health care the more we free up American businesses to compete in the global economy. Finally, we’ll be a lot better off if we work with other countries to create fair and efficient global trade and financial systems. We’ll have a better chance of getting others to open up their markets if we ourselves act less hypocritically—that is, if we open our own markets to their goods and stop subsidizing American agriculture.
Some portion of the damage done by the Bush administration could be rectified quickly. A large portion will take decades to fix—and that’s assuming the political will to do so exists both in the White House and in Congress. Think of the interest we are paying, year after year, on the almost $4 trillion of increased debt burden—even at 5 percent, that’s an annual payment of $200 billion, two Iraq wars a year forever. Think of the taxes that future governments will have to levy to repay even a fraction of the debt we have accumulated. And think of the widening divide between rich and poor in America, a phenomenon that goes beyond economics and speaks to the very future of the American Dream.
In short, there’s a momentum here that will require a generation to reverse. Decades hence we should take stock, and revisit the conventional wisdom. Will Herbert Hoover still deserve his dubious mantle? I’m guessing that George W. Bush will have earned one more grim superlative.

Joseph Stiglitz, a leading economic educator, is a professor at Columbia.

... Hoover v. Bush? No brainer. It all kinda reminds me of an obscure 70's song, The Needle and the Damage Done.

Wednesday, October 31, 2007

It's the ACCELERATION, stupid!

Once again, MSM misses the underlying truth

ANCHORAGE, Alaska (AP) - A Coast Guard reconnaissance team is heading to
the far north this week to scope out a new frontier that the warming Arctic
climate is opening to ship traffic.
The Coast Guard could set up an
operations base in Barrow as early as next spring to monitor waters that are now
free of ice for longer periods of the year. Weather permitting, a scouting crew
will fly 1,183 miles Thursday from Barrow, the northernmost U.S. town, to the
North Pole.
"This is a new area for us to do surveillance," said Rear Adm.
Arthur E. Brooks, commander of the Coast Guard's Alaska district. "We're going
primarily to see what's there, what ships, if any, are up there."
ice has made travel along the northern coast increasingly attractive, said
Brooks, who plans to accompany the crew in the C-130 flight. Tankers and even
cruise ships are beginning to venture into the domain once traveled only by
indigenous hunters and research vessels, such as the Coast Guard ice-cutter
The ice cap is believed to be warming faster than the rest of the
world, and recent studies suggest shipping routes could open in the Arctic in as
little as a decade. Just a few years ago, scientists predicted it would
take a century for the ice to melt.

... see, again the Big Deal here is not that warming is happening, it's that it continues to accelerate, thereby reaching predicted levels much faster than our predictions.

Gore's epitaph will be "He was an optimist."

Wait, here's another...

Carbon Dioxide in Atmosphere Increasing
Oct 22, 9:39 PM

WASHINGTON (AP) - Just days after the Nobel prize was awarded
for global warming work, an alarming new study finds that carbon dioxide in the
atmosphere is increasing faster than expected.
Carbon dioxide emissions were
35 percent higher in 2006 than in 1990, a much faster growth rate than
anticipated, researchers led by Josep G. Canadell, of Australia's Commonwealth
Scientific and Industrial Research Organization, report in Tuesday's edition of
Proceedings of the National Academy of Sciences.
Increased industrial use of
fossil fuels coupled with a decline in the gas absorbed by the oceans and land
were listed as causes of the increase.
"In addition to the growth of global
population and wealth, we now know that significant contributions to the growth
of atmospheric CO2 arise from the slowdown" of nature's ability to take the
chemical out of the air, said Canadell, director of the Global Carbon Project at
the research organization.
The changes "characterize a carbon cycle that is generating stronger-than-expected and sooner-than-expected climate forcing," the researchers report.

... The headline says "increasing" but it's the ACCELERATION, stupid!
And the acceleration was not only unexpected, accelerating phenomena are by nature virtually impossible to forecast accurately.

.... and another:

SYDNEY, Australia (AP) - Worldwide economic growth has accelerated the level of
greenhouse gas emissions to a dangerous threshold scientists had not expected
for another decade, according to a leading Australian climate change
Tim Flannery told Australian Broadcasting Corp. that an upcoming
report by the U.N. Intergovernmental Panel on Climate Change will contain new
data showing that the level of climate-changing gases in the atmosphere has
already reached critical levels.
"What the report establishes is that
the amount of greenhouse gas in the atmosphere is already above the threshold
that can potentially cause dangerous climate change," Flannery told the
broadcaster late Monday. "We are already at great risk of dangerous climate
change, that's what these figures say. It's not next year or next decade, it's

.... more:

2007-09-17 10:18:
(AP) - Arctic ice has shrunk to the lowest level on record, new satellite
images show, raising the possibility that the Northwest Passage that eluded
famous explorers will become an open shipping lane.
The European Space Agency
said nearly 200 satellite photos this month taken together showed an ice-free
passage along northern Canada, Alaska and Greenland, and ice retreating to its
lowest level since such images were first taken in 1978.
The waters are
exposing unexplored resources, and vessels could trim thousands of miles from
Europe to Asia by bypassing the Panama Canal. The seasonal ebb and flow of ice
levels has already opened up a slim summer window for ships.
Leif Toudal
Pedersen, of the Danish National Space Center, said that Arctic ice has shrunk
to some 1 million square miles. The previous low was 1.5 million square miles,
in 2005.
"The strong reduction in just one year certainly raises flags that
the ice (in summer) may disappear much sooner than expected," Pedersen said in
an ESA statement posted on its Web site Friday.
Pedersen said the extreme
retreat this year suggested the passage could fully open sooner than expected -
but ESA did not say when that might be. "
... ESA didn't say because they
COULDN'T say -- it's not just the continuing decline, it's the accelerating rate
of decline that should have you worried.

...STILL more:

2007-08-17 13:10:41
WASHINGTON (AP) - There was less sea ice in the
Arctic on Friday than ever before on record, and the melting is continuing, the
National Snow and Ice Data Center reported.
"Today is a historic day," said Mark Serreze, a senior research scientist at the center. "This is the least sea ice we've ever seen in the satellite record and we have another month left to go in the melt season this year."

Analysis of NOAA CO2 concentration measurements since '59: From 1960 to 1997, the net acceleration was a total of .25 ppm/yr^2. Since '97 it has more than doubled:

I infer that not only is the warming rate accelerating, the ACCELERATION rate is itself ACCELERATING. I won't bother adding exclamation points -- either you get the implication or you don't.
If we're past recovery, then it's time to put some focus on amelioration of the consequences of the train wreck, even if you still try to slow the train.

... Nature says "don't start something I'm going to have to finish":

"Up to now it has been generally assumed that global warming will be a linear
process. However evidence from the geological past linked with climate modelling
that takes into account the global warming that is already locked into the
system indicates that there may not be a linear response to rising CO2 levels.
There is a danger that at some point we will cross a threshhold when global
warming accelerates.
By continuing to increase the amount of CO2 in the
atmosphere we are getting closer to that point.

From the analysis of the
bubbles of air trapped in ice cores taken from the Greenland icecap that are up
to 500,000 years old it has been shown that the temperature of the Earth's
atmosphere and the CO2 content has followed a regular 100,000 year cycle of
change with the CO2 content and temperature closely linked and following the
same graph line. Within this regular cycle there are some recently discovered
very short periods of approximately only a few hundred years duration when
temperatures rise dramatically by 8 degrees centigrade above the slower rises of
up to 7 degrees centigrade. This gives a total range of 15 degrees centigrade
...only now are models being constructed that incorporate a feed-back
into the model of the effects of changes in world climate due to the changes in
temperature that are predicted by the model as the model programme runs. One of
the most important effects of climate change is the release of carbon dioxide
from natural processes as atmospheric temperature rises... The climate change
models show that rising sea temperatures in the Pacific Ocean result in less
rainfall and a longer dry season in the Amazon Basin...If the Amazon rainforest
burns and releases billions of tons of CO2 into the atmosphere in a short period
then this will be a further boost to global warming that will result in
significantly higher end of century temperatures.

The climate change model with climate change induced feedbacks indicates that on present trends the date for the change from CO2 sink to source for the Amazon rainforest is about 2050.

Here's another "based on projected climate change" study...
ROME (AP) - Climate change could drive many wild
relatives of plants such as the potato and the peanut into extinction,
threatening a valuable source of genes necessary to help these food crops fight
pests and drought, an international research group reported.
During the next
50 years, more than 60 percent of 51 wild peanut species analyzed and 12 percent
of 108 wild potato species analyzed could become extinct because of climate
change, according to a study released Tuesday by the Consultative Group on
International Agricultural Research.
Surviving species would be confined to
much smaller areas, further eroding their capacity to survive, the report
The study looked at the distribution of various species and predicted
their ability to survive based on current and projected climate data for 2055."

... Estimating is easy. ACCURATE estimating is the challenge. And when all the models are based on straight line extrapolation and the real world is showing rapid ACCELERATION, the only thing for sure is WE DON'T KNOW HOW BAD it's gonna get or HOW FAST.

Chickens come home to roost

The bigger the chicken, the longer it takes ...

"Not very many people are talking about what do we do to live with the consequences of what's happening," said James Brock, a longtime industry consultant in the Beijing office of Cambridge Energy Research Associates. "The polar bears are doomed - they're going to museums. At the end of this century the Arctic ice cap will be gone. That means a lot of water rising, not by inches but meters."

Burned since ancient times, coal dramatically increased in use during the Industrial Revolution, when it became fuel for the new steam engines, gas lamps and electrical generators. Worldwide demand for coal dipped at the end of the 20th century, but is now back up and projected to rise 60 percent by 2030 to 6.9 billion tons a year, according to the International Energy Agency.

In America, about 150 new coal-fired electrical plants are proposed over the next decade. In China, there are plans for a coal-fired power plant to go on line nearly every week. Emissions from these plants alone could nullify the cuts made by Europe, Japan and other rich nations under the Kyoto Protocol "

GW & wildfires, part II

More things I bet you didn't know ...

... like "The fire season in the last 15 years or so has increased more than two months over the whole Western U.S. So actually 78 days of average longer fire season in the last 15 years compared to the previous 15 or 20 years"

... and: "in 2006, the feds spent $2 billion on fire fighting, seven times more than just ten years ago. "

Seems that Nature is just throwing bigger and bigger tantrums at us.

"Perfect storm overwhelms well prepared CA" said the headline...
LOS ANGELES, Oct 25 (Reuters) - California's fire-fighting strategy has made big
strides since deadly infernos in 2003 but little could have prepared it for the
perfect storm of drought, high winds and triple-digit temperatures behind
massive blazes this week, officials said on Thursday.
... but it wasn't a perfect storm. We'd had a very dry year in SoCal so there was actually much less build up of fuel to dry out than in a wet year. On the other hand it's the lengthening of the fire season by 78 days over the last decade that really makes more of these inevitable.

... How's that working for ya?

Saturday, September 15, 2007

... How's that working for ya?

Thursday, September 06, 2007

Bush knew Saddam had no weapons of mass destruction Salon exclusive: Two former CIA officers say the president squelched top-secret intelligence, and a briefing by George Tenet, months before invading Iraq. By Sidney Blumenthal (Clockwise from top left) Naji Sabri, George W. Bush, Colin Powell and George Tenet. On Sept. 18, 2002, CIA director George Tenet briefed President Bush in the Oval Office on top-secret intelligence that Saddam Hussein did not have weapons of mass destruction, according to two former senior CIA officers. Bush dismissed as worthless this information from the Iraqi foreign minister, a member of Saddam's inner circle, although it turned out to be accurate in every detail. Tenet never brought it up again. Nor was the intelligence included in the National Intelligence Estimate of October 2002, which stated categorically that Iraq possessed WMD. No one in Congress was aware of the secret intelligence that Saddam had no WMD as the House of Representatives and the Senate voted, a week after the submission of the NIE, on the Authorization for Use of Military Force in Iraq. The information, moreover, was not circulated within the CIA among those agents involved in operations to prove whether Saddam had WMD. On April 23, 2006, CBS's "60 Minutes" interviewed Tyler Drumheller, the former CIA chief of clandestine operations for Europe, who disclosed that the agency had received documentary intelligence from Naji Sabri, Saddam's foreign minister, that Saddam did not have WMD. "We continued to validate him the whole way through," said Drumheller. "The policy was set. The war in Iraq was coming, and they were looking for intelligence to fit into the policy, to justify the policy."

Thursday, July 26, 2007

Gonzo Avoids Implicating Bush (Barely)

Comey’s Evidence of a Crime Returns
On May 18th, “Scoop” reported that the testimony of James Comey, former Deputy Attorney General under John Ashcroft, provided evidence of a crime in which Bush, Gonzales, and Card” were clearly implicated. It was apparent that Bush had ordered his then counsel Alberto Gonzales and adviser, Andrew Card, to the sick bed of an ailing and sedated John Ashcroft. Their mission was to obtain Ashcroft’s signature authorizing warrant-less surveillance of Americans.
Ashcroft had stepped down temporarily due to his pending hospital stay. His deputy, James Comey, became acting Attorney General. Comey had refused to sign the authorization since he, Ashcroft and senior Justice Department lawyers found it highly objectionable. Over the objection of Ashcroft’s wife, the two entered the hospital room and made their case. Ashcroft rose from his sick bed to refuse. Gonzales and card failed in their mission.
Today’s testimony by still U.S. Attorney General Alberto Gonzales before the Senate Committee on the Judiciary provides a major clue as to the direction future impeachment charges might take, should they be brought.
First a brief recap of the May 18th article.
Tuesday was a remarkable day at the U.S. Senate Judiciary Committee hearings. The exchange between Sen. Charles Schumer, R, NY and former Deputy Attorney General James Comey provides clear evidence pointing to criminal activity by the president, U.S Attorney General Alberto Gonzales, and former presidential advisor, Andrew Card. If Comey’s testimony is supported by other reliable witnesses, the Bush, Gonzales, and Card crew have some serious questions to answer.The article went on to describe questions that might be very troubling.
There are at least two major problems facing the participants in this affair.First, the White House attempted to obtain approval for a program that they knew the acting Attorney General would not approve. Second, they sought this approval from someone without authority, Ashcroft. He stepped down due to his illness and passed authority to Comey. Of great significance, however, is the fact that the program was implemented. It doesn’t matter if it was for an hour, a day or a week. Comey tells us warrantless surveillance on U.S. citizens was implemented without the required DOJ approval due to Comey’s unwillingness to attest “as to its legality.”Seeking approval from someone without authority while that someone, John Ashcroft, was heavily sedated is certainly a crime. Having that enterprise end in failure and then implementing the program anyway is further evidence of a crime.
The program was implemented without authorization as indicated by this exchange between Comey and Schumer:
Schumer: Right. And you stated that the next day, Thursday, was the deadline for reauthorization of the program, is that right?
Comey: Yes, sir.
Schumer: OK. Can you tell us what happened the next day?
Comey: The program was reauthorized without us and without a signature from the Department of Justice attesting as to its legality. And I prepared a letter of resignation, intending to resign the next day, Friday, March the 12th
Both Sides Tip Their Hands: Look at Today’s Testimony in Light of the Above
Transcript compiled from recording: Senator Charles Schumer (D-NY) questions U.S. Attorney General Alberto Gonzales at the Justice Department Over site Hearings, Senate Committee on the Judiciary. July 24, 2007.

Schumer: Let me ask you this. Who sent you to the hospital?
Gonzales: Senator what I can say is we had a very important meeting at the White House over one of the most important…
Schumer: I didn’t ask you that.
Gonzales: I’m answering your question senator if I could?
Schumer: Who sent you? Did anyone tell you to go?
Gonzales: It was one of the most important programs for the United States. It had been authorized by the president. I’ll just say that the chief of staff to the President of the United States, the counsel for the President of the United States went to the hospital on behalf of the President of the United States.
Schumer: Did the president ask you to go?
This is the key question. Sen. Schumer’s sole purpose is to get Gonzales to admit, to confirm what everyone knows. Bush told Gonzales and Card to go to Ashcroft’s hospital bed and get his signature.
Gonzales: We were there in behalf of the President of the United States.
The colloquy begins. Gonzales is not going to say that the president asked him to go. He begins his first of several uses of on “behalf of the president” as a diversion. “Behalf” leaves open the possibility that Card and Gonzales went just because they thought it was a good idea (“Let’s surprise the boss and get Ashcroft to sign this thing.”) This leaves the opening that Bush didn’t order the trip with its clear criminal implications (See Comey article, 18 May 2007)
Schumer: I didn’t ask you that. Did the president ask you to go?
Gonzales: Senator we were there on behalf of the President of the United States
Schumer: Why can’t you answer that question?
Schumer knows what is going on with “behalf” and he won’t tolerate it. He makes clear that Gonzales is not answering.
Gonzales: That’s the answer I can give you Senator
“…the answer I can give you…” Why is this all he “can” give. Because Gonzales was counsel to the president at this time, the president’s lawyer. Obviously Gonzales does not have his former client’s permission to answer this question. Privilege applies and this is the answer he gives as the former lawyer for the president.
Schumer: Well can you explain to me why you can’t answer it directly?
Gonzales: Senator, again we were there on an important program for this president on behalf of the President of the United States.
This “important program” is said to be the NSA civilian phone monitoring program; the one that Comey and Ashcroft wouldn’t approve in the form it was presented. The form of the program was so offensive, there was a mass resignation about to occur at the Department of Justice..
Schumer: Did you talk to the president about it beforehand?
Schumer broadens the time frame for a presidential request for the visit.
Gonzales: Senator, obviously there were a lot of discussions that happened during that period of time. This involved one of the president’s premier programs.
It seems as thought Gonzales is saying that there was a request or order by the president prior to the meeting but this is not specific.
Schumer: But sir you’re before this committee. You are before this committee. You are supposed to answer questions. You’ve not claimed any privilege. I don’t think there is any here, and I asked you to answer and you refuse to answer it. Why?.
Gonzales: Senator … if I can answer the question I will answer the question.
Schumer: But could you tell me why can’t you answer that question?
Gonzales: Senator because again this relates to activities that existed when I was with in White House and because of that, with respect to your specific question, I will go back, I will go back and see whether or not I can answer the question.
This is more on Gonzales excuse for not answering the question – attorney-client privilege. In his view, privilege applies unless his client at that time, the President of the United States, waives privilege.
Schumer: Did the Vice President send you?
For the record, Sen. Schumer takes one last shot..
Gonzales: Senator, we were there on behalf of the president
Schumer: Did you talk to the Vice President about it?
Gonzales: We were there on behalf of the president.
Schumer: You will not answer that question as well. Is that correct?
Gonzales: We were there on behalf …if I can … I’d be would be happy to take back your question if we can respond to it we well.
Clearly, Gonzales will not answer any question that implicates Bush as ordering the visit, thus participating in a conspiracy to commit illegal acts, as outlined in Comey’s May 18, 2007 testimony before Sen. Schumer.
Sen. Schumer On Point
Senator Schumer was amazingly on point during this line of questioning; even more so than when his questioning of Comey established the probability of crimes committed by Bush, Card, and Gonzales. When Schumer clearly became aware that he would get no answer, he only gave Gonzales one chance to bring up attorney-client privilege. Schumer asked, “Well can you explain to me why you can’t answer it directly?”
Schumer also stayed tightly focused, to his great advantage, when Gonzales tried on several occasions to bring national security into the testimony as an excuse for the act he won’t acknowledge Bush committing (ordering the visit). At the very beginning, Gonzales tries to divert the discussion to national security by referring to a “very important meeting …one of the most important…” Schumer responded quickly with “I didn’t ask you that” to put Gonzales back on task, Schumer’s task. A bit later, Gonzales refers to one of the “premier programs” and “an important program.” Had Schumer taken the bait, Gonzales would have raised the terrorist threat that was the excuse for the domestic surveillance program they were trying to legitimize (after the fact, perhaps). Schumer stayed on task, focused on who ordered the visit.
Gonzales was damned if he answered and damned if he didn’t. Had he said “Well attorney client privilege applies,” Schumer might have responded: “So the president told you not to answer any questions about his ordering you and Card to the hospital to Ashcroft’s sick bet in order to obtain a signature from a highly sedated man who was not in a position to sign legally in the first place.”
By not explicating the attorney-client privilege excuse, Gonzales looks like a fool to the public. “Why won’t he answer those questions,” the typical viewer asks. At this point, Americans are well beyond a willingness to decipher the hidden meanings between the lines. It simply looks like Gonzales is a slippery character, one they don’t particularly trust in the first place.

Here’s Why Gonzales Won’t Answer
Obviously Bush ordered the visit to get the signature. Card and Gonzales would have broken the first rule of the Bush White House, disloyalty to the boss. Is there anyone in America who has been awake for any of the past seven years who thinks that they would free lance, cross the boss?
Since Bush did order the visit, he’s part of a group action, also known as a conspiracy, to commit illegal acts. Those are outlined above and in the May 18th article. Participation in such an activity is clearly defined in federal code:
Section 371. Conspiracy to commit offense or to defraud United States If two or more persons conspire either to commit any offense against the United States, or to defraud the United States, or any agency thereof in any manner or for any purpose, and one or more of such persons do any act to effect the object of the conspiracy, each shall be fined under this title or imprisoned not more than five years, or both. 18USC371 U.S. Code as of: 01/19/04
Senator Charles Schumer’s questioning of Gonzales lays the groundwork for impeachment of the president based on the most odious crime imaginable, trying to take advantage of a sick man, a man recovering from surgery, a man whose wife has insisted that there be no visitors. It’s not only a “high crime,” it’s a heinous one as well.

... But this is the Anything Goes administration. Didn't you get that memo?

Sunday, July 22, 2007

The Man Who Would Be King

Nov 2005, Republican Congressional leaders filed into the Oval Office to meet with President George W. Bush and talk about renewing the controversial USA Patriot Act. Several provisions of the act, passed in the shell shocked period immediately following the 9/11 terrorist attacks, caused enough anger that liberal groups like the American Civil Liberties Union had joined forces with prominent conservatives like Phyllis Schlafly and Bob Barr to oppose renewal. GOP leaders told Bush that his hardcore push to renew the more onerous provisions of the act could further alienate conservatives still mad at the President from his botched attempt to nominate White House Counsel Harriet Miers to the Supreme Court.

“I don’t give a goddamn,” Bush retorted. “I’m the President and the Commander-in-Chief. Do it my way.”

“Mr. President,” one aide in the meeting said. “There is a valid case that the provisions in this law undermine the Constitution.”

“Stop throwing the Constitution in my face!” Bush screamed back. “It’s just a goddamned piece of paper!”

... Of course the real issue here is NOT that Dubya was so scornful of the document he'd sworn (on a BIBLE no less!) to protect, it's that his supporters don't give a tinker's dam WHAT the Cretin in Chief says, ANYTHING goes!

... How's that working for ya?

Saturday, May 19, 2007

The Ideological Animal
We think our political stance is the product of reason, but we're easily manipulated and surprisingly malleable. Our essential political self is more a stew of childhood temperament, education, and fear of death. Call it the 9/11 effect.

We tend to believe our political views have evolved by a process of rational thought, as we consider arguments, weigh evidence, and draw conclusions. But the truth is more complicated. Our political preferences are equally the result of factors we're not aware of—such as how educated we are, how scary the world seems at a given moment, and personality traits that are first apparent in early childhood. Among the most potent motivators, it turns out, is fear. How the United States should confront the threat of terrorism remains a subject of endless political debate. But Americans' response to threats of attack is now more clear-cut than ever. The fear of death alone is surprisingly effective in shaping our political decisions—more powerful, often, than thought itself.

Abstract Art vs. Talk Radio: The Political Personality Standoff

Most people are surprised to learn that there are real, stable differences in personality between conservatives and liberals—not just different views or values, but underlying differences in temperament.

Psychologists John Jost of New York University, Dana Carney of Harvard, and Sam Gosling of the University of Texas have demonstrated that conservatives and liberals boast markedly different home and office decor. Liberals are messier than conservatives, their rooms have more clutter and more color, and they tend to have more travel documents, maps of other countries, and flags from around the world. Conservatives are neater, and their rooms are cleaner, better organized, more brightly lit, and more conventional. Liberals have more books, and their books cover a greater variety of topics. And that's just a start. Multiple studies find that liberals are more optimistic. Conservatives are more likely to be religious. Liberals are more likely to like classical music and jazz, conservatives, country music. Liberals are more likely to enjoy abstract art. Conservative men are more likely than liberal men to prefer conventional forms of entertainment like TV and talk radio. Liberal men like romantic comedies more than conservative men. Liberal women are more likely than conservative women to enjoy books, poetry, writing in a diary, acting, and playing musical instruments.

"All people are born alike—except Republicans and Democrats," quipped Groucho Marx, and in fact it turns out that personality differences between liberals and conservatives are evident in early childhood. In 1969, Berkeley professors Jack and Jeanne Block embarked on a study of childhood personality, asking nursery school teachers to rate children's temperaments. They weren't even thinking about political orientation.

Twenty years later, they decided to compare the subjects' childhood personalities with their political preferences as adults. They found arresting patterns. As kids, liberals had developed close relationships with peers and were rated by their teachers as self-reliant, energetic, impulsive, and resilient. People who were conservative at age 23 had been described by their teachers as easily victimized, easily offended, indecisive, fearful, rigid, inhibited, and vulnerable at age 3. The reason for the difference, the Blocks hypothesized, was that insecure kids most needed the reassurance of tradition and authority, and they found it in conservative politics.

The most comprehensive review of personality and political orientation to date is a 2003 meta-analysis of 88 prior studies involving 22,000 participants. The researchers—John Jost of NYU, Arie Kruglanski of the University of Maryland, and Jack Glaser and Frank Sulloway of Berkeley—found that conservatives have a greater desire to reach a decision quickly and stick to it, and are higher on conscientiousness, which includes neatness, orderliness, duty, and rule-following. Liberals are higher on openness, which includes intellectual curiosity, excitement-seeking, novelty, creativity for its own sake, and a craving for stimulation like travel, color, art, music, and literature.

The study's authors also concluded that conservatives have less tolerance for ambiguity, a trait they say is exemplified when George Bush says things like, "Look, my job isn't to try to nuance. My job is to tell people what I think," and "I'm the decider." Those who think the world is highly dangerous and those with the greatest fear of death are the most likely to be conservative.

Liberals, on the other hand, are "more likely to see gray areas and reconcile seemingly conflicting information," says Jost. As a result, liberals like John Kerry, who see many sides to every issue, are portrayed as flip-floppers. "Whatever the cause, Bush and Kerry exemplify the cognitive styles we see in the research," says Jack Glaser, one of the study's authors, "Bush in appearing more rigid in his thinking and intolerant of uncertainty and ambiguity, and Kerry in appearing more open to ambiguity and to considering alternative positions."

Jost's meta-analysis sparked furious controversy. The House Republican Study Committee complained that the study's authors had received federal funds. George Will satirized it in his Washington Post column, and The National Review called it the "Conservatives Are Crazy" study. Jost and his colleagues point to the study's rigorous methodology. The study used political orientation as a dependent variable, meaning that where subjects fall on the political scale is computed from their own answers about whether they're liberal or conservative. Psychologists then compare factors such as fear of death and openness to new experiences, and seek statistically significant correlations. The findings are quintessentially empirical and difficult to dismiss as false.

Yet critics retort that the research draws negative conclusions about conservatives while the researchers themselves are liberal. And it's true that over the decades, a disproportionate amount of the research has focused on figuring out what's behind conservative behavior. Right shift is likewise more studied than left shift, largely because most of that research has been since 9/11, and aimed at trying to explain the conservative conversions of people like Cinnamon Stillwell.

Even with impeccable methodology, bias may creep into the choice of which phenomena to study. "There is a bias among social scientists," admits Glaser. "They look for the variables that are unflattering. There probably are other nice personality traits associated with conservatism, but they haven't shown up in the research because it's not as well studied."

"There are differences between liberals and conservatives, and people can value them however they like," Jost points out. "There is nothing inherently good or bad about being high or low on the need for closure or structure. Some may see religiosity as a positive, whereas others may see it more neutrally, and so on."

Red Shift

By 2004, as the presidential election drew near, researchers saw a chance to study the Jost results against the backdrop of unfolding events. Psychologists Mark Landau of the University of Arizona and Sheldon Solomon of Skidmore sought to explain how President Bush's approval rating went from around 51 percent before 9/11 to 90 percent immediately afterward. In one study, they exposed some participants to the letters WTC or the numbers 9/11 in an image flashed too quickly to register at the conscious level. They exposed other participants to familiar but random combinations of letters and numbers, such as area codes. Then they gave them words like coff__, sk_ll, and gr_ve, and asked them to fill in the blanks. People who'd seen random combinations were more likely to fill in coffee, skill, and grove. But people exposed to subliminal terrorism primes more often filled in coffin, skull, and grave. "The mere mention of September 11 or WTC is the same as reminding Americans of death," explains Solomon.

As a follow-up, Solomon primed one group of subjects to think about death, a state of mind called "mortality salience." A second group was primed to think about 9/11. And a third was induced to think about pain—something unpleasant but non-deadly. When people were in a benign state of mind, they tended to oppose Bush and his policies in Iraq. But after thinking about either death or 9/11, they tended to favor him. Such findings were further corroborated by Cornell sociologist Robert Willer, who found that whenever the color-coded terror alert level was raised, support for Bush increased significantly, not only on domestic security but also in unrelated domains, such as the economy.

University of Arizona psychologist Jeff Greenberg argues that some ideological shifts can be explained by terror management theory (TMT), which holds that heightened fear of death motivates people to defend their world views. TMT predicts that images like the destruction of the World Trade Center should make liberals more liberal and conservatives more conservative. "In the United States, political conservatism does seem to be the preferred ideology when people are feeling insecure," concedes Greenberg. "But in China or another communist country, reminding people of their own mortality would lead them to cling more tightly to communism."

Jost believes it's more complex. After all, Cinnamon Stillwell and others in the 911 Neocons didn't become more liberal. Like so many other Democrats after 9/11, they made a hard right turn. The reason thoughts of death make people more conservative, Jost says, is that they awaken a deep desire to see the world as fair and just, to believe that people get what they deserve, and to accept the existing social order as valid, rather than in need of change. When these natural desires are primed by thoughts of death and a barrage of mortal fear, people gravitate toward conservatism because it's more certain about the answers it provides—right vs. wrong, good vs. evil, us vs. them—and because conservative leaders are more likely to advocate a return to traditional values, allowing people to stick with what's familiar and known. "Conservatism is a more black and white ideology than liberalism," explains Jost. "It emphasizes tradition and authority, which are reassuring during periods of threat."

To test the theory, Jost prompted people to think about either pain—by looking at things like an ambulance, a dentist's chair, and a bee sting—or death, by looking at things like a funeral hearse, the grim reaper, and a dead-end sign. Across the political spectrum, people who had been primed to think about death were more conservative on issues like immigration, affirmative action, and same-sex marriage than those who had merely thought about pain, although the effect size was relatively small. The implication is clear: For liberals, conservatives, and independents alike, thinking about death actually makes people more conservative—at least temporarily.

Fear and Voting In America

Campaign strategists in both parties have never hesitated to use scare tactics. In 1964, a Lyndon Johnson commercial called "Daisy" juxtaposed footage of a little girl plucking a flower with footage of an atomic blast. In 1984, Ronald Reagan ran a spot that played on Cold War panic, in which the Soviet threat was symbolized by a grizzly lumbering across a stark landscape as a human heart pounds faster and faster and an off-screen voice warns, "There is a bear in the woods!" In 2004, Bush sparked furor for running a fear-mongering ad that used wolves gathering in the woods as symbols for terrorists plotting against America. And last fall, Congressional Republicans drew fire with an ad that featured bin Laden and other terrorists threatening Americans; over the sound of a ticking clock, a voice warned, "These are the stakes."

"At least some of the President's support is the result of constant and relentless reminders of death, some of which is just what's happening in the world, but much of which is carefully cultivated and calculated as an electoral strategy," says Solomon. "In politics these days, there's a dose of reason, and there's a dose of irrationality driven by psychological terror that may very well be swinging elections."

Solomon demonstrated that thinking about 9/11 made people go from preferring Kerry to preferring Bush. "Very subtle manipulations of psychological conditions profoundly affect political preferences," Solomon concludes. "In difficult moments, people don't want complex, nuanced, John Kerry-like waffling or sophisticated cogitation. They want somebody charismatic to step up and say, 'I know where our problem is and God has given me the clout to kick those people's asses.'"

Into The Blue

Studies show that people who study abroad become more liberal than those who stay home.

People who venture from the strictures of their limited social class are less likely to stereotype and more likely to embrace other cultures. Education goes hand-in-hand with tolerance, and often, the more the better:

Professors at major universities are more liberal than their counterparts at less acclaimed institutions. What travel and education have in common is that they make the differences between people seem less threatening. "You become less bothered by the idea that there is uncertainty in the world," explains Jost.

That's why the more educated people are, the more liberal they become—but only to a point. Once people begin pursuing certain types of graduate degrees, the curve flattens. Business students, for instance, become more conservative in their views toward minorities. As they become more established, doctors and lawyers tend to protect their economic interests by moving to the right. The findings demonstrate that conservative conversions are fueled not only by fear, but by other factors as well. And if the November election was any indicator, the pendulum that swung so forcefully to the right after 9/11 may be swinging back.

Tipping The Balance

Political conversions that are emotionally induced can be very subtle: A shift in support for a given issue or politician is not the same as a radical conversion or deep philosophical change. While views may be manipulated, the impact may or may not translate in the voting booth. Following 9/11, most lifelong liberals did not go through outright conversion or shift their preferred candidate. Yet many liberals who didn't become all-out conservatives found themselves nonetheless sympathizing more with conservative positions, craving the comfort of a strong leader, or feeling the need to punish or avenge. Many in the political center moved to the right, too. In aggregate, over an electorate of millions—a large proportion of whom were swing voters waiting to be swayed one way or the other—even a subtle shift was enough to tip the balance of the Presidential election, and the direction the country took for years. "Without 9/11 we would have a different president," says Solomon. "I would even say that the Osama bin Laden tape that was released the Thursday before the election was sufficient to swing the election. It was basically a giant mortality salience induction."

If we are so suggestible that thoughts of death make us uncomfortable defaming the American flag and cause us to sit farther away from foreigners, is there any way we can overcome our easily manipulated fears and become the informed and rational thinkers democracy demands?

To test this, Solomon and his colleagues prompted two groups to think about death and then give opinions about a pro-American author and an anti-American one. As expected, the group that thought about death was more pro-American than the other. But the second time, one group was asked to make gut-level decisions about the two authors, while the other group was asked to consider carefully and be as rational as possible. The results were astonishing. In the rational group, the effects of mortality salience were entirely eliminated. Asking people to be rational was enough to neutralize the effects of reminders of death. Preliminary research shows that reminding people that as human beings, the things we have in common eclipse our differences—what psychologists call a "common humanity prime"—has the same effect.

"People have two modes of thought," concludes Solomon. "There's the intuitive gut-level mode, which is what most of us are in most of the time. And then there's a rational analytic mode, which takes effort and attention."

The solution, then, is remarkably simple. The effects of psychological terror on political decision making can be eliminated just by asking people to think rationally. Simply reminding us to use our heads, it turns out, can be enough to make us do it.

This content is Copyright Sussex Publishers, LLC. 2006. This content is intended for personal use and may not be distributed or reproduced without the consent of Sussex Publishers, LLC. Please contact for more information.

Publication: Psychology Today Magazine
Publication Date: Jan/Feb 2007

... How's that working for ya?

Monday, May 14, 2007

politically charged Injustice Dept

Officials describe politically charged Justice Dept.

Why am I not a bit surprised?

(05-12) 04:00 PDT Washington -- Two years ago, Robin Ashton, a seasoned criminal prosecutor at the Department of Justice, learned from her boss that a promised promotion was no longer hers.
"You have a Monica problem," Ashton was told, according to several Justice Department officials. Referring to Monica Goodling, a 31-year-old, relatively inexperienced lawyer who had only recently arrived in the office, the boss added, "She believes you're a Democrat and doesn't feel you can be trusted."
Ashton's ouster -- she left the Executive Office for U.S. Attorneys for another Justice Department post two weeks later -- was a critical early step in a plan that would later culminate in the ouster of nine U.S. attorneys last year.
Goodling would soon be quizzing applicants for civil service jobs at Justice Department headquarters with questions that several U.S. attorneys said were inappropriate, such as who was their favorite president and Supreme Court justice. One department official said an applicant was even asked, "Have you ever cheated on your wife?"
Goodling also moved to block the hiring of prosecutors with resumes that suggested they might be Democrats, even though they were seeking posts that were supposed to be nonpartisan, according to two Justice officials.
And she helped maintain lists of all the U.S. attorneys that graded their loyalty to the Bush administration, including work on prior political campaigns, and noted if they were members of the Federalist Society, a conservative legal group.
By the time Goodling resigned in April -- after her role in the firing of the federal prosecutors became public and she had been promoted to the role of White House liaison -- she and other senior Justice officials had revamped personnel practices affecting employees from the top of the agency to the bottom.
The people who spoke about Goodling's role at the department, including eight current Justice Department lawyers and staff members, did so only on condition of anonymity for fear of retribution. Several of them added that they found her activities objectionable and damaging to the integrity of the department.
Goodling, who is under investigation by the agency's inspector general and ethics office, as well as by Congress, has declined to testify before a House panel, citing her Fifth Amendment privilege to avoid making self-incriminating statements. Her lawyer, John Dowd, declined on Friday to comment.
But a judge in U.S. District Court in Washington signed an order Friday to grant her limited immunity, which will allow House investigators to compel her to answer questions.
Justice Department officials declined to respond to questions about Goodling's actions and refused to allow some agency employees to speak with a reporter about them.
"Whether or not Ms. Goodling engaged in prohibited personnel practices is the subject of an ongoing investigation," a written statement said. "Given the ongoing nature of the investigation, we are unable to comment on the allegations."
Goodling, now 33, arrived at the agency at the start of the Bush administration after working as an opposition researcher for the Republican National Committee during the 2000 presidential campaign.
Her legal experience was limited; she had graduated in 1999 from Regent University School of Law, which was founded by the religious broadcaster Pat Robertson.
Deeply religious and politically conservative, Goodling seemed to believe that part of her job was to bring people with similar values into the Justice Department, several former colleagues said.
Goodling first worked in the Justice Department's press office and then for less than a year in the executive office, which oversees budgets, management and performance evaluations of U.S. attorneys. She then moved to the Attorney General's Office, where she became the White House liaison and collected a $133,000 annual salary, according to federal records.
Goodling's mandate over hiring expanded significantly in March 2006, when Attorney General Alberto Gonzales signed a confidential memorandum delegating to her and Kyle Sampson, his former chief of staff, the power to appoint or fire all department political appointees other than the U.S. attorneys. That included interim U.S. attorneys and heads of the divisions that handle civil rights, public corruption, environmental crimes and other matters.
At the same time, Goodling, Sampson and John Nowacki, another Regent University graduate, were helping prepare the final list of U.S. attorneys to be dismissed, according to e-mail messages released to congressional investigators. Goodling was also calling around the country trying to identify up-and-coming lawyers -- and good Republicans -- who could replace them, said one Justice Department official who received such a call.

Eric Lipton, New York TimesSaturday, May 12, 2007

Wednesday, May 09, 2007

7 French Lessons

Seven reasons to pay attention to the French election.
1. A woman running for president. Socialist standard-bearer Sigolene Royal made a plea to women voters to support her out of gender solidarity. They didn't. 52 percent of female voters cast their ballots for Mr. Sarkozy, compared with 48 percent for Ms. Royal. Hillary, are you paying attention?
2. The husband issue. Royal's long-time life-partner and father of her four children is the head of the French Socialist party. He's a hugely powerful politician. During the campaign, the couple publicly clashed on a number of important issues, undercutting her persona of being independent and self-directed. Bill, are you listening?
3. The return of the moderates. In the first round of elections, self-described centralist candidate Francois Bayrou came out of nowhere, almost winning a spot in the final round of voting. His hugely popular political campaign advocated a new era of politics based on unity and the middle-way: not too conservative, and not too socialist. In short, the politics of political consensus. Do American voters desire the same? John Edwards and Mike Huckabee are betting they do.
4. Wedge politics. After taking a thumping in the first round of elections, far-right ideologue Jean-Marie Le Pen called for his supporters to boycott the second round. The result? Voter turnout in the all-important second round was over 84%, the highest in decades. Does this signify an end to wedge politics? If so, goodbye Newt.
5. Immigration. This is a hot-button issue in France, maybe even bigger than it is in our country. Yet the most outspoken advocate of clamping down on immigration, Jean-Marie Le Pen, pulled down less than 10% of first round votes. Nicholas Sarkozy, an advocate of 'tough but fair' immigration reform, is now the elected president. Come 2008, where will the American people stand on this issue? Exile 12 million people or figure out a way to allow a reasonable level of immigration?
6. Social programs. The French have hugely generous and comprehensive social programs. They have a liberal welfare system, a compassionate retirement program and a fantastic socialized medical system. It's all very amazing. In fact, it's too good to be true. The costs of maintaining these programs is generating massive national debt. The French seem to be turning slightly away from Socialist-flavored, collectivist solutions and considering the benefits of more Anglo-Saxon type economic liberalism. In what direction will we choose to turn in 2008?
7. Foreign affairs. Immediately after winning the election, Nicholas Sarkozy had a special message for France's American friends. "I want to tell them that France will always be by their side when they need her, but that friendship is also accepting the fact that friends can think differently."
Does this mean we expect an earthshaking change in French-American relations? Sarkozy went on to criticize the United States for obstructing the fight against global warming which he said would be a high priority for his new government. That's not likely to play well in the Bush White House. And Sarkozy's position on Iraq? Don't bother to ask. Le plus ca change le plus ca le meme chose.

... How's that working for ya?