Bacon's Rebellion

  • The New Frontier of Auto Safety: Transportation Pricing

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    James A. Bacon

    Want to reduce the number of traffic accidents and automobile fatalities? Cracking down on drunk driving, enforcing seatbelt usage, installing air bags and banning texting while driving all have proven useful. But, while the incidence of traffic fatalities has declined from five per year in 1960 to two per year in 2000, the total number of fatalities has barely budged because Americans are driving so much more, says Todd Litman with the Victoria Transport Policy Institute in a recent paper, “Pricing for Traffic Safety.”

    Pricing transportation so that drivers directly pay for the costs associated with their automobile travel can be justified on economic grounds, contends Litman. A major side benefit, rarely mentioned by pricing advocates, is that reducing the number of vehicle miles traveled also cuts the number of automobile accidents as well.

    VDOT take notice!

  • How Long Will the VRS Money Last?

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    James A. Bacon

    Here’s the good news: If the Virginia Retirement System can generate an annual return on investment of 8% annually in the future, it will last until 2040 before the money runs out.

    Here’s the bad news: If the assumed returns are more modest (or more realistic) — say, 6% annually — assets will last only until 2033, about the same time that the Social Security is expected to run out of money.

    So finds a new study by the Center for Retirement Research at Boston College, “Can State and Local Pensions Muddle Through?,” using the conventional “ongoing” methodology for calculating pension fund exhaustion dates. Using the more stringent “termination” framework, the news is even more grim: Under a 6%-return scenario, the VRS could run dry by 2025.

    That information appears in Appendix B in the report. You can see there how the VRS fares against other state and municipal retirement plans. It’s not a pretty sight. Though far from the worst, the VRS is in worse shape than many others.

    The CRC’s calculations assume, of course, no significant changes to the way the retirement plans are structured. Gov. Bob McDonnell, as did former Gov. Tim Kaine before him, recommends sweeping reforms to the retirement system for public employees. Those who would oppose the reforms should take a look at the CRC study, which has no obvious ideological axe to grind, and contemplate what retirement for Virginia’s public employees would look like if we stick with the status quo.

    I suppose there is one alternative to reforming the plans — stick up the taxpayers. That tends to be the preferred solution of my esteemed liberal colleague, Peter Galuszka, who in the previous post trotted out a laundry list of taxes that could be tapped to pay for continued state funding of NPR. But it might be a hard sell politically to ask taxpayers, few of whom participate in defined benefit plans, to cough up more money than they already do to support public employees in a retirement far more comfortable than they are likely to enjoy. Good luck with that!

  • Save NPR Funding!

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    James A. Bacon

    The wolves are circling NPR, the supposed bug-a-boo of liberal bias.

    The conservatives are building momentum, in one form or another, to cut the influential radio, television and Internet system that provides badly-needed news, analysis and foreign reporting when market-driven news sources have chopped away most of their assets in pursuit of ever-dwindling net income (or so they say).

    Here in Virginia, Gov. Robert McDonnell, a staunch right-winger, wants to stop $4.2 million in state funding the Virginia’s NPR stations. The Republican-led House of Representatives wants to cut far more across the nation. Rationale for the cuts runs the right wing gamut from U.S. Rep. Eric Cantor who complains that NPR is “too liberal” to James A, Bacon Jr., who says that the 30-plus-year-old government funding model is dogmatically wrong although he likes NPR and is willing to kick in a few bucks of his own dough as NPR struggles to come up with a new business model. (THANK YOU, Jim!).

    To set the stage for de-fanging NPR, the right-wing uses its omnibus financial crisis — the concept that government spending is way out of control and we have to take extraordinary measures to stem it. There is some truth here but the timing is suspect. The campaign started just about on the day that Barack Obama was inaugurated as president. His predecessor blew out federal spending through two wars, tax cuts for the rich, Medicare prescription plan changes after Bill Clinton contained it. Using the scare tactics of a debt Armageddon, the right wing is swiftly moving in various, seemingly pre-planned ways (Cantor here, Bacon there) to get rid of NPR once and for all.

    Not that NPR hasn’t screwed up. The firing of Juan Williams was completely out of line and and NPR executive stupidly fell victim to a ham-handed covert ruse by a right-wing video outfit (highly suspect itself). About 29 year ago, I co-broke a story in the Richmond Times-Dispatch about how the president of WCVE — Richmond’s public tv station — was self-dealing by using public money to buy tv remote equipment that was quickly amortized and then used by the president’s private, for-profit company to make commercials and broadcast basketball games.

    In Virginia, the current financial crisis model doesn’t exactly hold water. True the state of billions in the hole for roads, education and other critical needs. But that’s the fault of the General Assembly, not state NPR stations. Last year, McDonnell seemed to pull a rabbit out of the hat by coming in with a budget surplus, but he did so by playing accounting tricks with the state retirement system. As far as roads, poof, suddenly there was an extra billion lying around left by Democratic Gov. Time Kaine for a rainy day.

    So, just how bad is Virginia’s fiscal crisis anyway? Let’s look at ways we can find the $4.2 million to save NPR funding. Consider these:

    • The Washington Post has reported that as the state is crimping on funding help for education and the mentally ill, the General Assembly renewed a $45 million annual provision for two big utilities, Dominion and Appalachian Power, to buy coal mined in Virginia. The measure has been on the books since 1999and gives tax credits worth $3 per ton for Old Dominion coal. Why is this government welfare needed? Metallurgical coal which the state produces now fetches $200 a metric done at the mine. Global demand for Central Appalachian met coal is so strong that Norfolk Southern railroad is scrambling to come up with 2,500 new hopper cars and collier are backed up at anchor in Hampton Roads. Why does coal need help?

    • One thing I heard on NPR. Amazon.com doesn’t pay state sales taxes. Here’s a company that brings in more than $35 billion in revenues by selling goods over the Net. Virginia should think about getting its share. Back in the early Net days, people like then-governor George Allen, anxious to embrace the “digital Dominion,” fought taxing the Net. Well, that was then. Amazon.com ain’t exactly a start-up any more,.

    • The gas tax. We pay among the lowest of any state in the country. This is the simplest solution.

    So there you have it. Finding $4.2 million to save NPR funding shouldn’t be that hard, just as it shouldn’t be to ease the pain for the sick and students who need an education. It’s time to get past the financial-crisis panic mentality and the worry-mongers.

    Peter Galuszka

  • The Right Reason to De-Fund Public Broadcasting

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    James A. Bacon

    There’s a right reason and a wrong reason to support Gov. Bob McDonnell in his proposal to eliminate state funding for public broadcasting. According to today’s Times-Dispatch, McDonnell seeks to cut $4.2 million over the next two years.

    The wrong reason is that public broadcasting is “biased” and “liberal.” That’s the justification that Rep. Eric Cantor, R-7th, who is leading the effort to eliminate federal funding, gave in a recent radio interview. The implication of Cantor’s remarks was that if NPR and PBS were more conservative, federal funding would be less objectionable. Wow, think about that. The government-funding-is-OK-as-long-as-it-serves-conservative-ends was the basis of George W. Bush’s “compassionate conservatism,” and look where that got us in the fight to tame spending and deficits.

    The right reason is the one that McDonnell cited in the Times-Dispatch: “Television and radio broadcasts are not core functions of government.” It’s that simple. When federal, state and local governments face the greatest financial strains since the Great Depression, with worse to come, there is no justification whatsoever for government funding of news or entertainment. Government’s role should be restricted to undertaking important functions that the private sector cannot fulfill itself. In the realm of news and entertainment media, that is demonstrably not the case, more so than ever now that the Internet has inspired an unprecedented proliferation of news, opinion and programming sources.

    For the record, I’m an NPR fan. I’m a conservative, and I agree that a bias does exist, although it’s more subtle than many fellow conservatives seem to think. I find that NPR, which I listen to several times a week, has excellent programming. While some of its stories may have a liberal slant, they are far more nuanced than the sound-bite versions of the equally slanted news aired by private-sector broadcast news. I listen to NPR in order to hear the thoughtful, well-informed liberal view of an issue as opposed to, say, the dishonest, cartoon-character version peddled by the likes of Ed Schultz or Keith Olbermann. Bottom line: NPR contributes to the marketplace of ideas, as opposed to the marketplace of venom and bile.

    (Other than the news, I watch very little TV, so I have no informed opinion on the nature of PBS programming.)

    If the state defunded NPR, as it should, and if the Richmond NPR radio station were faced with cutting programming, I’d gladly chip in a few bucks during the annual telethons. My wife already does. That’s the proper way for the public to support media programming. The people who enjoy NPR and PBS are the ones who should pay for the privilege.

    Read Norm Leahy’s spin on the issue on his new blog at The Score. Like me, he argues that broadcasting is not a core government function, nor even a peripheral one — not that NPR is “too liberal.”

  • Johnny’s Right to Be Fat and Stupid

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    James A. Bacon

    Two recent actions by the McDonnell Administration raise questions about just how much state public education is being short-changed by el-cheapo spending practices.

    First, Gov. Bob McDonnell vetoed a bill that would have expanded to 150 minutes a week the required physical education that children in lower and middle schools would get. The average now in some, not all, schools is about 90 minutes.

    Secondly, after a firestorm of controversy over an errant history textbook, the Department of Education has required publishers, not teachers or administrators, to be responsible for fact-checking. The matter stemmed from a Connecticut publisher whose fourth-grade history book was riddled with factual errors and bad punctuation, stating, erroneously, that African-Americans fought by the thousands for the Southern the Civil War.

    The stated reasons for not requiring PT are that many schools just don’t have the facilities to handle kickball, running, baseball or basketball. Many in the education bureaucracy did not want the bill for the same reasons, although legislators, including a doctor, thought it would do much to stem the childhood obesity problems that are running amok in Virginia and the rest of the nation.

    Many school-age kids are far too tubby than they should be. They don’t exercise, drink sugary-super-sized sodas and fatty fast food and spend most of their time away from school in front of the Wii screen playing computer games.

    Indeed, the right to be fat has been seized by some on the ultra-conservative circuit as a right equal to that of bearing arms or going to one’s own church. Any institution, such as the schools, that try to direct kids to a healthier lifestyle, incredibly, are dubbed socialist.

    For evidence, tune into your local American Family Radio show and listen to how the right to eat a three-patty- thick-burger at Hardee’s is now an unalienable right. My wife, a teacher, found this out the hard way a couple of years ago when she gently suggested that maybe one child’s lunch his mother packed should not be merely an extra big biscuit covered with sausage gravy.

    If parents and our culture are not going to get the children exercising, is it wrong to have the state do it? Apparently, according to libertarians who are wiling to die for their rights and have the kids die of diabetes.

    The textbook case merely shifts “responsibility” for fact-checking to textbook publishers. Teachers do go to Richmond each year where for about $200 in pin money go over the books as for suitability. But can you depend on the publishers to fact-check?

    Who knows and who cares, as long as the state doesn’t have to pay for it. That’s the silver-lining. Johnny and Janie can weigh 300 pounds and learn a lot of wrong stuff, but we get to save some pennies. The Virginia Way!

    Peter Galuszka

  • The Tax-free Corporation

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    James A. Bacon

    Here’s a news item you aren’t likely to see in “Boomergeddon:” U.S. industrial behemoth General Electric paid no taxes in 2010. That’s right: zippo, nada, nichevo.

    How can it be? As the Boomergeddons and Baconauts complain, we’re heading towards financial meltdown in terms of deficits and debt. Their culprits are entitlement programs, the Washington establishment, poor people demanding aid, free-spending middle class types, and (did I mention this yet?), the government, government, government.

    But GE? The famed and successful maker of lightbulbs, refrigerators, diesel locomotives, high tech medical gear and nuclear reactors (of the type used at Fukushima)? Last year, according to the New York Times, GE had worldwide profits of $14.2 billion, with $5.1 billion coming from outside the U.S.

    Incredibly, it paid no taxes in the U.S. and, in fact, insisted on a tax benefit of $3.2 billion.

    How can that be? The Boomergeddons claim that America’s tax rate of 35 percent is a major impediment to the prosperity of U.S. corporations whose good performance (not to mentioned outsized CEO salaries) trickle down to us lower in the food chain through taxes, jobs, etc.

    So how did GE do it? It has a first rate tax department, obviously, including lots of ex-Treasury Department types. It puts ins creativity to work at finding tax breaks, in fact, that’s part of the corporate “mission” statement. One rich seam to mine was GE Capital, with ties to Richmond, which found interesting tax dodges as a lender.

    Is this good for the U.S. economy? Ask yourself but the answer should be very simple.

    Peter Galuszka

  • Sandy Alberta, the Saudi Arabia Next Door

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    James A. Bacon

    (Let me introduce my latest op-ed piece in the Washington Times with the observation that the preferred U.S. path to “energy independence” is conservation — not just higher mileage standards or electric vehicles but “deep” conservation enabled by the reform of human settlement patterns. But that’s not something that can be explained in a 750-word op-ed piece, so I didn’t get into it.)

    The Middle East is experiencing one of its periodic convulsions and, as day follows night, tsunamis follow earthquakes and trouble follows Lindsay Lohan, America’s chattering classes have renewed talk about “energy independence.” America’s reliance upon “foreign” oil is said to be undesirable. Why? Because it makes us vulnerable to Arab oil embargoes, anti-American crackpots like Moammar Gadhafi and Hugo Chavez, and madmen bent upon acquiring nuclear weapons and dominating the Persian Gulf oil fields.

    There are very good reasons for wanting to extract ourselves from the chaos of the Middle East. But does that really mean we should forsake all “foreign” oil? To the extent that we can avoid buying our petroleum from people who either (a) hate us, or (b) could be taken over next week by people who hate us, energy independence is a good idea. But to the extent that it becomes a justification to squander tens of billions of dollars on white elephants ranging from synfuel facilities (Carter administration) to solar-energy fabrication plants (Obama administration), it’s a bad idea.

    Permit me to suggest an alternate definition of “energy independence”: The United States ceases to purchase oil from parts of the world where supplies can be disrupted by wars, civil strife, regime change or capricious government edict and instead buys it from democratic, peace-loving countries that appreciate the benefits of free markets and abide by the rule of law – in other words, countries like Canada.

    Many Americans think most of our foreign oil comes from Saudi Arabia. In fact, more than half comes from the Western Hemisphere: Venezuela, Mexico and Canada. Oil production in the two Latin countries has declined in recent years, but oil output is booming in Canada. Indeed, our friends the Canucks export 2.7 million barrels of petroleum per day, accounting for roughly 30 percent of total U.S. imports.

    Yes, our courteous, self-effacing friend to the north has quietly emerged as the No. 1 foreign supplier of oil to the United States. Development of new extractive technologies and $50-plus-per-barrel oil prices have made the vast Athabascan oil sands, located primarily in Alberta, economical to mine. Between conventional oil sources and the oil sands, Canada sits atop 175 billion barrels of oil, the third-largest proven reserves in the world. The Canadian Association of Petroleum Producers forecasts that production will increase to 4.3 million barrels per day by 2025.

    As Brian Crowley, managing director of the Ottawa-based MacDonald-Laurier Institute puts it, “Alberta’s oil sands constitute a geopolitical fact of global significance.” Current reserve estimates are based on the assumption that 10 percent of the oil sands are recoverable, he says. If new technology boosts recovery to 20 percent, he says, that would put “a second Saudi Arabia” on America’s doorstep – a Saudi Arabia that doesn’t commit human rights abuses, fund radicalizing madrassas or send the United States into a blind panic when a neighboring power threatens to invade.

    The Canadians speak of a strategic U.S.-Canadian energy relationship that would foster development of Canadian oil resources for shipment to U.S. markets. The only trouble is, few Americans are listening. The U.S. commentariat discusses non sequiturs like fostering a strategic U.S.-Russian energy partnership, creating “green” wind and solar-energy farms that require massive subsidies or building electric cars that, if the early sales of General Motors’ Volt are any indication, nobody wants to buy.

    The Canadians are willing to ship us all the oil we want, subject to their ability to expand capacity. There’s just one catch: They need a way to get it to us. That means building pipelines such as TransCanada’s proposed multibillion-dollar pipeline, which would link Canada to the vast petrochemical refining complex in Houston. What Canadians want is regulatory approval for construction of the pipelines – approval that, given the opposition of the environmental lobby, is far from guaranteed.

    As Americans, we need to ask ourselves: Where would we prefer to get our oil? From Saudi Arabia, which manipulates oil prices to extract maximum wealth from American consumers? From Russia, where Vladimir “turn off the tap” Putin uses his control over oil and natural-gas supplies as a strategic political weapon? From Iran, which uses oil revenue to fund development of an atomic bomb? Or from Canada, a country with a democratic market economy, which recycles some of its oil revenues by purchasing American goods and where an influential environmental movement lobbies for appropriate environmental safeguards?

    Only in the bizarro world of Washington could the answer fail to be blindingly obvious.

  • The Song of the Uninsured Musician

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    James A. Bacon

    Today is the first anniversary of Obamacare, otherwise known as the Affordable Health Care for America Act. And despite the Sound and the Fury, basic problems still remain unsolved.

    Over the past year, there’s been plenty of gnashing of teeth, mostly from the GOP, well-funded by the managed care industry, which wants Obamacare repealed or killed by a lack of funds.

    Hot shot Attorneys General, such as our own Kenneth Cuccinelli, are challenging the constitutionality of the law, claiming its mandate to have all Americans buy health plans goes contrary to the foundation of America. Henrico County’s Eric Cantor, House Majority Leader, is working in tandem with the “Cooch” on Capitol Hill, leading his “Young Guns” against health care reform, which he claims in unaffordable.

    Let’s take a look at things a little closer to home.

    On March 15, Page Wilson, a singer-songwriter from Hanover County who was well-known in Central Virginia. died of natural causes. In his 57 years, Wilson had worked the circuits with his own version of Roots music, Rockabily, zydeco, country and folk. He has helped numerous local musicians make it in a tough market and shunned selling out to the big money music interests in Nashville, Los Angeles or other cultural centers.

    Wilson, whose band “Reckless Abandon” played many down-home sites, such as the Pocahontas State Park, also hosted a Saturday night public radio show out of Richmond called the “Out of the Blue Radio Revenue.” Wilson’s extremely broad playlist entertained and eduated listeners like me when at home on a Saturday night. It was one of the nice things of living in the Richmond area, even though his show was available anywhere throughthe Web.

    Living the musician’s lifestyle took its toll on Wilson. He had money issues and his health deterioriated. Back in 2008, some of the muisicians he had backed hosted a concert for him called “Party for Page,” to raise money to help. “I’m on the verge of losing my house to foreclosure,” he was quoted as saying. “If the dog is hurt, the sled don’t run. And this dog is hurting right now.”

    The much-maligned Obamacare does one thing — it is the only serious plan around that would provide health coverage for everyone, including self-employed types such as Page Wilson and myself. That’s why we need to have everyone buy plans — so those that do don’t end up paying for those that don’t. It’s a hard fact of life and the Obama plan has a way to help people of little means do so.

    The only alternative would be universal, government health care — not a bad idea in my book, or that of many doctors I know. But the monied interests, and those beholden to the managed care firms who got their tremedous power with the last major health insurance shift in the late 1970s and 80s, are ready to defend their strong positions with lobbying bucks, with their Cantors and Cuccinelli’s in support. Neither has proposed a serious alternate plan.

    It’s too late to help Page WIllson, however. He was one of 46 million Amerians who did not have health insurance and it was a factor in his death. Oh, I forgot, the right-wing loudly disputes that 46 million number, if we are to believe the American Spectator.

    Funny but I don’t see any other ideas — just nit picking. As the arguments drone on, we’re losing more talented, uninsured Americans, just like Page Wilson.

    Peter Galuszka

  • A WRAP — THE NEXT STEP

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    James A. Bacon

    NOTE ON JIM BACON’S COMMENT

    Jim Bacon made and important comment on the 18 March A WRAP post.

    That post now has a number of comments and has slipped into history status. This response would require at least five comments due to the limit on comment length of Blogger so it is a new posted. This comment repeats all of Mr. Bacon’s original comment.

    We hope this post clarifies EMR’s view:

    PART ONE

    Jim Bacon said:

    “EMR and Observer appear to be disappointed that I returned from my vacation with the same insistence that the impending collapse of federal and state agency finances is the most urgent and massive problem facing the United States.”

    EMR cannot speak for Observer but as to EMR, that is a correct characterization. One of the great benefits of travel is to come back with a new perspective. That has been the case every time EMR has returned from Hawaii.

    EMR’s disappointment is NOT because EMR thinks Agency debt / deficits are NOT important. (Yes, a double negative.)

    EMR KNOWS Agency debt / deficits are important. However, Agency debt / deficits are a symptom of a much larger problem – Agency structure dysfunction.

    More important, the Agency debt / deficit CANNOT be solved without broad citizen understandings of and willingness to act on at least three Fundamental Transformations.

    To solve the Agency debt / deficit problem – and all the other problems, including the many upon which EMR and Mr. Bacon agree – there must be a coalition of interests, not a “this is the most important one and the rest of you need to get on my bandwagon.”

    That is especially true if the Agency debt / deficit problem is blamed on ‘others’ who occupy empty pigeon holes and who are just too stubborn or stupid to understand why THEY must change.

    When MGM says that going after one or another problem as ‘the most important’ is a ‘waste of time,’ EMR suspects he means that ‘times is a wasting.’ There is not time to get it right on issue A and then move to issue B, then C, then D,…

    In a democracy there must be agreement on the need for action and the only way to get a critical mass of support is to address A, B, C … Z.

    Citizen will not yet support solutions to this or that problem because they do not yet see breadth of the systemic dysfunctions – economic, social and physical. In EMR’s view, they will never get there picking on one problem at a time.

    “Frankly, I cannot see how it can be argued otherwise.”

    Hopefully, we can come to a consensus on why this it not a wise course – especially for those like Jim Bacon who see much more of the full spectrum of reality than the average single issue advocate.

    ……………….

    PART TWO

    “Of course, I agree that dysfunctional human settlement patterns create a massive drain on economic efficiency and productivity and a detriment to the quality of life.”

    Mr. Bacon and EMR have long agreed on this point.

    “Of course, I agree that our society is draining down natural capital, and we will pay the price for atrocities committed upon the environment.”

    That is good but these are TWO different topics.

    An intelligent harvest / use / plan for replacement (substitution) of Natural Capital is possible without committing ‘atrocities.’ The fact that atrocities have been committed, and are continuing to be committed, is topic one.

    Far more important is the fact that the ‘more developed’ Regions and nation-states living on Natural Capital made accessible by technological ‘advances’ has distorted ALL the parameters of a sustainable civilization.

    It is as if every Household, every Enterprise, every Institution and YES, every Agency has had a no-limits checking account ECONOMIC context AND a no need to be civil or cooperative SOCIAL context AS WELL AS a ‘there is no tomorrow’ perspective on the physical environment.

    Yes, part of this Mass OverConsumption has ‘helped’ Regions outside the US. However, many did not want that help, much of the help was really ‘help’ for US Enterprises (The Banana Republics) and to further US interests (cheap oil to support dysfunctional settlement patterns). Fighting World War I and II, the Marshall Plan, etc. were great but there are many more examples of wasting resources – including Natural Capital – to meet questionable objectives.

    EMR wishes he knew of a way to better express the huge gulf between

    1) Citizen, Enterprise, Institution and Agency expectations, and

    2) Finite reality

    That has resulted over the past 200 years from living off of Natural Capital – life on blueberry hill / big rock candy mountain.

    As Mr. Bacon knows from having reviewed an early draft of ENOUGH?, that EMR perspective is that the turmoil in North Africa and the Middle East will bring the fact that there is NOT ENOUGH into focus, sooner rather than later.

    “(I don’t share the alarmism about global warming, but there are plenty of other environmental problems that I find very worrisome).”

    On this issue a compromise is to agree to call it ‘climate change’ and wait until the flock of Black Swans is so large that they CANNOT be ignored, regardless of what they are called.

    “Where I part company is over the idea that DHSP (dysfunctional human settlement patterns) and EC (environmental collapse) take precedence over all other problems, and that all other problems can largely be seen as sub-sets of DHSP and EC.”

    If this is ‘where we part company,’ we have NOT parted company.

    THE SHAPE OF THE FUTURE documents that human settlement patterns have controlling impact on the economic, social and physical well being of humans and their Organizations (Agencies, Enterprises, Institutions and Households)

    However, TRILO-G makes it clear that a Fundamental Transformation of human settlement patterns will NOT be possible without a Fundamental Transformation of governance structure …

    (AS NOTED BELOW THE DEBT / DEFICIT ISSUE IS A RESULT OF FAILURE TO EVOLVE A GOVERNANCE STRUCTURE THAT REFLECTS THE ECONOMIC, SOCIAL AND PHYSICAL REALITY IN 2011.)

    … and Fundamental Transformation of the economic system from one based on competition and consumption to one that gives equal weight to cooperation, resiliency and rational regulation to serve the interest of all citizens.

    (More on that below with respect to Vocabulary and conceptual framework.)

    To summerize: Functional human settlement patterns are NOT more important than a debt / deficit solution, they are both – along with other problems facing civilization – dependent on comprehensive solutions – the Three Fundamental Transformations noted above for starters.

    Synergy’s current work on CITIZEN MEDIA, THE NEXT STEP, on PRIMER and on ENOUGH?, is driven by the realization that the other projects (THE CURRENT TRAJECTORY and ALPHA VIL 21 as well as WHAT COMES AFTER THE CAR) which ARE related to the human settlement patterns (The Affordable and Accessible Housing Crisis, The Mobility and Access Crisis and The Helter Skelter Crisis) will go no where without:

    1) A source of information that citizens can rely on to make intelligent decisions in the voting booth and in the marketplace (CITIZEN MEDIA, THE NEXT STEP)

    2) A Vocabulary with which to reach consensus on comprehensive Conceptual Frameworks, (PRIMER) and

    3) Enough economic, social and physical resources to create a sustainable trajectory for civilization (ENOUGH?)

    These are the VERY SAME things that are required to achieve solve the Agency debt / deficit Crisis.

    ………………

    PART III

    Jim Bac
    on further stated:

    “The federal budget deficit may be related tangentially [to DHSP and EC], but for the most part it is an independent phenomenon.”

    Not really.

    Beyond the John Muir’s “everything tied to everything else”paradigm for both causes and solutions, there is this reality:

    The Agency debt / deficit problem is a result of the structure of governance. Until the structure is changed – move the level of decision to the levels (yes, levelS) of impact, there will continue to be an Agency debt / deficit problem. The Agency debt / deficit problem is the logical course of action for those at the state and federal level who are elected by uninformed citizens and must serve the interests of those who pay for their elections. All those problems are Agency structure problems.

    “If we fixed DHSP and EC tomorrow, the national government still would be only a decade or two away from insolvency.”

    Not necessarily.

    If citizens understood the need to address DHSP and EC they would ALSO understand the need to eliminate the Agency debt / deficit problem.

    Fairly allocating location-variable costs in a first step to cure DHSP and EC AND an important part of solving the Agency debt / deficit problem.

    Also note that the final beneficiaries of the Agency debt / deficit problem is the top 5 percent of the Ziggurat. All the welfare queens in the country have not taken home as much as the TARP (and non TARP) executives. But it is those at the top of the Ziggurat who make the political Clan contributions. See AFTERSHOCK. (More on this when to get to Vocabulary.)

    “The reason I believe that fiscal solvency is the most urgent issue is that it is only a decade or two away. (Some people think it is only three or four *years* away.) Environmental collapse is down the road.”

    Again, not necessarily.

    It depends on how one defines ‘environmental collapse.’ In a sense, Peak Oil IS an environmental collapse.

    The rising price of food and energy may be seen as a collapse. The economic incentive to shift grain production from food for poor Regions to fuel for rich Regions may be seen as a trigger to collapse.

    Food prices were a trigger for the North Africa / Middle East Arab Spring. As you know we explore this in ENOUGH? (“If money to buy food and iPhones does not flow TO the Arab Street, blood will flow IN the Arab Street.)

    “There will be no hope of solving our environmental issues if the federal government is functionally bankrupt. Cleaning up the environment will take a massive expenditure of capital, which simply will not be available.”

    EMR is not sure this is the case.

    Most of the ‘clean up’ will be paid for by the revenue stream created by ongoing programs. For example new sewerage plants to clean up surface water will be paid for from increased sewerage fees. Better agricultural practices will be paid for with higher food prices (AND NON INDUSTRIAL AG).

    The REAL KEY will be if those in the bottom 90 percent of the Ziggurat have money to pay their bills.

    (THEY WILL IF THEY GET A FAIR WAGE AND DO NOT HAVE TO PAY FOR DYSFUNCTIONAL MOBILITY AND ACCESS AND HOUSING SCATTERATION – just had to toss that in. This supports Observers comment on the recent post concerning progressive tax rates. )

    “We can talk about achieving fundamental change in governance structures. I share that goal.”

    That is great because the Agency debt / deficit problem is a RESULT of Agency (governance) structure as noted above.

    “However, I am under no illusions that creating alpha region governments, alpha community governments and on down the line will solve the problems created by a federal government in which expenditures exceed revenues by roughly $1 trillion a year over the course of the economic cycle and in which interest payments on the debt will increasingly crowd out all expenditures of any kind.”

    There must be Fundamental Transformation of governance structure (Agencies) up and down the scale. If there were functional governance structures at and below the Regional scale, the problems caused by kicking issues up to the federal level.

    Pork fat is easier to trim, one pig at a time.

    “To put this in terms that Observer might find familiar, we cannot put human settlement patterns and agencies on a sustainable trajectory without putting agency finances on a sustainable trajectory.”

    That is very true.

    However, the obverse is also true:

    We cannot put Agency finances on a sustainable trajectory without citizen support for a range of Fundamental Transformations.

    “But we have to be realistic. It is the work of a generation or longer (perhaps akin to the task of abolishing slavery) to bring about fundamental change in governance structures…”

    The issue is NOT how fast we can COMPLETE Fundamental Transformations, the key is how fast majority of citizens understand the NEED to make those Transformations. See Chapter 29 of THE SHAPE OF THE FUTURE concerning the 10 year process to transform governance structure. Once started, not completed, citizens can support other meaningful steps for all three Fundamental Transformations.

    For example many would agree to a change in Social Security benefits if at the same time there was a change to allow interest rates to go up to 5 or 6 percent so all the money the oldsters saved could revive the cash flow they expected when they put the money away. The current fiscal policy of cheap interest so the big boys will ‘invest’ and ‘grow the economy’ must be seen for what it is – a short term strategy for those at the top of the Ziggurat to make even more than they are now… Professor Bartlett is a big help here. Thank you again Groveton.

    “… and human settlement patterns….”

    As EMR has noted repeatedly, the biggest change required to transform the pattern of human activity and land use is INSIDE CITIZENS HEADS. That is being proven out in the steps needed to achieve a sustainable trajectory in ALPHA VIL 21.

    “assuming we can even persuade our fellow countrymen that fundamental change of the type we seek is even desirable.”

    Recall what the five of us agreed in 2004 in Charlottesville that resulted in PROPERTY DYNAMICS.

    Think where we would be if Friends of Virginia’s Future had the education program outlined in PART ELEVEN of TRILO-G when everyone’s property values went down 20 to 40 percent due to Enterprise, Agent and misinformed citizen greed! Outside R=30 it is still going down. See THE CURRENT TRAJECTORY.

    “The collapse of the federal government will occur long before fundamental change takes place.”

    But to prevent collapse in the economic, social and physical Spheres – including Agency collapse – there must have broad citizen agreement on the course of action not just convince ‘liberals’ or ‘conservatives’ to abandon their positions and jump on a single issue band wagon, no matter how important some think that is.

    “Let’s see how many people care about protecting the environment and investing in shared vehicle systems when unemployment hits 20%, Social Security/Medicare payments are being cut and the American empire (upon which the global trading system depends) is collapsing around us.”

    That is EXACTLY why citizens must come to support solution of all the problems or humans (there will be few CITIZENS left) will not solve any of them.

    See THE BOTTOM LINE which ACSGP posted as a comment following the 18 March A WRAP post. (EMR will copy and reorder those two posts. Thanks to AZA for at least getting the first one up second.)

    ……………….

    PART FOUR

    As promised above here is the note on Vocabulary and Conceptual Framework.

    As
    EMR has stressed to Groveton in their exchanges:

    While it may seem like a pain, citizens must come to grips with the use of a robust Vocabulary and comprehensive Conceptual Frameworks. (One will note that Groveton and Larry are still pounding away at one another about social security without regard to the fact that Social Security is an Agency program and insurance is an Enterprise program as noted in the 18 March A WRAP post.)

    Mr. Bacon may recall that in his comments on the draft of THE LITMUS TEST in CITIZEN MEDIA, THE NEXT STEP he addressed the Fundamental Theses Three (“Competition is in the drivers seat of contemporary civilization”) by saying “I partially agree. But competition has been partially supplanted by rent seeking (at all levels of government) as an organizing principle for the economy.”)

    ‘RENT SEEKING’ and MONOPOLY behaviors ARE COMPETITIVE behaviors. They are not Cooperative behaviors.

    Recall above the need to:

    Balance competitive and consumptive activities with cooperative and conservative behaviors to achieve a sustainable trajectory.

    On a finite planet with limited resources, there is NO alternative.

    Markets only work:

    If all citizen have resources to participate in the market AND

    There are effective and fair regulation by Agencies to protect citizens from unsustainable competitive behaviors – that includes monopoly and rent seeking behaviors among others. See again THE BOTTOM LINE.

    Agencies will only develop rational regulations and sustainable budget / debt / deficit strategies if Agencies at all scales of governance evolve to reflect economic, social and physical reality.

    That will only happen when there is wide-spread agreement on Vocabulary and Conceptual Frameworks – such as THE ESTATES MATRIX.

    That is a wrap.

    EMR

  • Class Warfare Update: Do the Rich Pay their “Fair” Share of Taxes?

    Posted on

    by

    James A. Bacon

    The United States has the most progressive tax system among the Organization for Economic Collaboration and Development states. Says who? Says OECD, which, the last time I checked, was not a mouthpiece for the Koch brothers.

    The top richest decile earns 33.5% of the national income and pays 45.1% of personal income taxes, for a ratio of 1.35. That compares to 28.4% share of income for all OECD nations and 31.6% share of all income taxes paid, for a ratio of 1.11.

    It is not clear from this Tax Foundation blog post whether income taxes paid by U.S. citizens include state income taxes or not. If it does, Virginia’s income taxes are way more progressive than in other OECD countries.

  • Let’s Take a Closer Look at Student Permits

    Posted on

    by

    James A. Bacon

    The University of Northern Virginia (UNVA) does business in Annandale, but you won’t find it listed on the State Council of Higher Education in Virginia’s list of accredited private colleges and universities. It’s one of an increasing number of unaccredited institutions that cater to foreign students, mostly Indian, who want to gain admittance to the United States on student visas.

    These institutions are virtually unknown to Americans but they market widely to young people in India. When they reach the U.S., many students take full-time work and pursue only nominal studies. According to this article in the Chronicle of Higher Education, Virginia and California are hotbeds of activity that is now drawing the scrutiny of U.S. Immigration and Customs Enforcement.

    UNVA is “certified” by SCHEV, which presumably means that it is legally recognized, though not accredited. SCHEV designates the following institutions as certified but not accredited:

    American College of Commerce and Technology (Falls Church)
    American Digital University (Sterling)
    Bethel College (Hampton)
    HyperLearning Technologies (Virginia Beach)
    iGlobal University (Annandale)
    International College of Washington (Annandale)
    Kings Park University of Accupuncture and Oriental Medicine (Alexandria)
    Saint Michael College of Allied Health (Alexandria)
    University of North America (Vienna)
    University of Northern Virginia (Annandale)
    Virginia School of Nursing & Medical Institute (Springfield)
    Virginia Tech Carilion School of Medicine (Roanoke)
    Virginia University of Oriental Medicine (Fairfax)

    If these institutions have arisen to meet the legitimate educational needs of people, whether American or foreign-born, then good for them. If they exist mainly to allow foreigners to circumvent immigration quotas in order to take American jobs, then they need to be examined closely. An argument can be made that immigration quotas need to be loosened up to allow more foreigners legal admittance to the U.S. I’m all in favor of having that conversation. I am not in favor of allowing student-visa mills to operate with impunity.

  • A WRAP

    Posted on

    by

    James A. Bacon

    EMR agrees with Observer’s comment on the “Batten Down the Hatches” (16 March) post:

    Disappointed that Mr. Bacon did not come back refreshed and with a clear perspective on the world and what will put humans on the sustainable trajectory. More on that in a copy of a note EMR received from MGM included below.

    SOCIAL SECURITY AND AGENCY SAFETY NETS

    A note for Groveton and Larry concerning Social Security:

    Your two perspectives could be reconciled if you each had a better understanding of Vocabulary and of the Four Estates that citizens have evolved to manage civilization. See THE ESTATES MATRIX.

    Social Security is an Agency (New First Estate) program. It is intended to make the lives of all citizens better – health, safety, welfare and all that jazz.

    Groveton is justifiably upset because the federal Agencies have not had the backbone to change the mathematics of Social Security to reflect the realities of 2011. The realities of the 30s, 40s and 50s are NOT the same as the realities of the 70s, 80s, 90s and 00s. Groveton is right that some changes since 1970 have made matters worse.

    Larry is justifiably upset because the federal Agencies have not had the backbone to change many programs, policies and controls that may have reflected reality at various times from 1790 through 2011. Instead of changing the governance structure and its policies, programs and controls – and in shameless acts of cowardice – Elephant and Donkey Clan politicians have been raiding the money put aside by older workers in the Social Security System.

    The “insurance” Larry and Groveton are talking about is an Enterprise (New Second Estate) product. It is intended to make money for the Enterprise AND spread future risk among those who can afford to pay the premiums.

    (NB. There is also ‘mutual insurance’ which is an Institution (New Third Estate) program. Mutual Insurance is a revered American tradition (from Waterford Mutual Insurance to the USAA, etc.) that spreads the risk among a community of ‘members.’)

    Enterprise insurance is a Trickle Down safety net system.

    Trickle Down Safety Nets do not work for all the citizens.

    TRICKLE DOWN IN GENERAL

    Tickle Down of Agency responsibilities does not work for all citizens, it now does not even work for most citizens. In fact it only works for those at the very top of the Ziggurat – those who contribute the most to the political Clans – Enterprises, Institutions and very wealthy Institutions.

    Trickle Down Housing does not work for all the citizens. (The Affordable and Accessible Housing Crisis – after the bubble burst it ‘works’ for less than 20% of the Households. The majority of the Households are not able to afford a dwelling with an acceptable range of the Services, Recreation and Amenity close to where they work.)

    Trickle Down Mobility and Access does not work for all the citizens. (The Mobility and Access Crisis – even at the current low energy and material prices 50% of the population cannot afford to buy and maintain a Large Private Vehicle that is fuel efficient and safe to drive on the Interstate Highway system.)

    Trickle down human settlement patterns do not work for all citizens. (The Helter Skelter Crisis – the sum of Spacial Dysfunctions affecting human settlements.)

    And that is just the parameters of human existence upon which SYNERGY focuses.

    It is also clear that:

    Trickle Down Health systems do not work for all the citizens. That is painfully evident for mental health now and for all health systems when true costs are fairly allocated so that rich medical Enterprises cannot afford to toss crumbs to those at the bottom of the Ziggurat. Regions and nation-states with universal health care (an Agency safety net) have better outcomes in terms of health, cost and longevity.

    In fact Trickle Down does not work for ANY of the functions for which citizens establish Agencies.

    Agencies must provide the services or they must establish projects, programs and controls to insure that ‘public utility functions’ work to the benefit of all citizens.

    This is not a Elephant / Donkey issue or a ‘liberal’ / ‘conservative’ issue and suggesting it is only clogs the road to functional and effective alternatives. Time is running out to make Fundamental Transformations.

    As EMR will document in the Perspective ENOUGH? (Forthcoming):

    Across North Africa and the Middle East 600-Million humans are saying they want a more fair share. If one adds in India where there are riots over Agency corruption and China where there are riots over democracy, and Brazil where the new president pledges to improve the lot of 14 million at the bottom of the Ziggurat, over half the world’s population is now in some form of revolt / promised Fundamental Transformation over the allocation of resources.

    Those who have been living off of more than their fair share – the US consumes 20 percent of the planet’s resources each year to support 5 percent of the planets population – have to make Fundamental Transformations to consume less or face dire consequences. See THE BOTTOM LINE.

    The days of living off Natural Capital and tossing down crumbs via Trickle Down is coming to an end.

    NORTH AFRICA

    Speaking of North Africa: Groveton should be fully on board with the need for the UN now that just passing a resolution causes Gaddafi to call for a cease fire – and then keep killing his countries citizens . With instantaneous communications that ploy will not last long. See THE BOTTOM LINE

    The excuse was raised again: Caving in to citizen demands, will ‘split the country’… So?

    In almost all cases, the only ones who benefit from NOT splitting the nation-states are those in control of divided nation-states.

    The US is currently fighting in two nation-states that are the product of imperialist edicts, not enlightened citizen interests.

    PROFESSOR BARTLETT

    Groveton:

    Thank you for posting the videos from Professor Bartlett. EMR has read of his work and had viewing his lecture on the “to do” list for years…

    ASAP in Cville has been trying to get him to come to Cville but his health has caused the scheduled presentations to be canceled. The ASAP leadership likes him because he has a simple message and sticks to population and resources topics and does not get into the more complex field of human settlement patterns.

    Bartlett’s basic point concerning human’s inability to understand the exponential function is irrefutable. The first Natural Law of Human Settlement Pattern is A = pie R sq. The root of Geographic Illiteracy is failure to understand that this exponential function applies to land consumption for Urban land uses.

    Groveton, You will find, if you look, a lot of folks that agree with much of what EMR says even if they are not ‘brothers.’

    AND FROM MGM

    Here is the note from MGM that was noted at the outset. Jim Bacon, Peter Galuszka, Groveton, Larry and TMT might find the observations of someone up to his armpits in Hydrofracking of interest:

    …………………..

    All this talk of federal debt is a waste of time.

    Humans must focus on the big picture.

    NO ONE – no Agency, no Enterprise, no Institution and no Household – to use Professor Risse’s useful Vocabulary – is paying their fair share of the total cost of contemporary, technology driven civilization.

    The public debt – federal, state and municipal – is important only as an example of this larger reality. You can solve the ‘federal debt crisis’ and not change the unsustainable trajectory of society.

    What about the private debt?

    What about the capita
    l stolen from future generations by burning through natural capital – not just petroleum and gas resources but top soil, fresh water (water to irrigate my farm), marine animals, rare earths…

    NO ONE wants to talk about total debt because NO ONE – Bottom, Middle or Top – knows how those debts could be paid.

    [See Professor Bartlett on continued ‘growth’ as a ‘solution.’]

    Bottom: Those at the bottom of the food chain cannot pay their fair share because the bottom 70 percent have been losing ground for three decades – they have no assets with which to pay for anything approaching the cost of their consumption AND they are consuming far less than they would like to. [See Note of North Africa and the Middle East.]

    Middle: The next 25 percent in the middle of the Ziggurat could not afford to pay their full costs if the costs were fairly allocated. They are running as fast as they can [RATZIES] to cover payment for just a few of the true costs.

    Top: Those in the top 5 percent have gamed the economic and governance systems so they do not have to pay anything.

    There are many ‘solutions’ but even if the elected ‘representatives’ and appointed staff [Governance Practitioners] knew exactly what to do they would be voted out of office by citizens who have no idea that they have to get off of big rock candy mountain.

    In the rest of the ‘developed’ world many of the nation-states are in better shape – until a tsusmai hits.

    Those Dr. Pangloss types who think things will get better as soon as ‘the recovery’ kicks in – they count on the stock market going up and the unemployment rolls go down – may be in for a shock when their words are used as evidence that they have committed Intentional Information Sabotage.

    ………………..

    COMMENTS WELCOME

    As always, constructive and informed comments are welcome. EMR has a number of dead lines and will not have time to respond. As is the current practice intentionally disruptive and unfounded comments will be deleted upon the unanimous recommendation of a volunteer review committee.

    AND A NOTE FOR LARRY

    Larry, you need to understand THE ESTATES MATRIX. EMR is NOT an Agency. What he thinks and writes is not an Agency policy or position. When someone repeatedly and intentionally misinterprets and intentionally sabotages posts or comments by those in search of alternatives to Business-As-Usual, they will be deleted. See CITIZEN MEDIA, THE NEXT STEP (Forthcoming)

    If that bothers you. just do not submit comments that you know will be deleted. You always have the option to start your own Blog.

    EMR

  • Open Thread

    Posted on

    by

    James A. Bacon

    At the suggestion of Groovey G. Groveton, I am creating an open thread. For those of you (I have Larry G. and Ray Hyde in mind) who like to carry on conversations that often range off topic from the original post, feel free to blast away.

  • Batten Down the Hatches

    Posted on

    by

    James A. Bacon

    The following essay was published in the Winter 2011 edition of Virginia Capital Connections. It serves as a useful reminder of the fact that the looming insolvency of the federal government, and of state governments dependent upon federal largesse, is not some fable foisted upon the American public by shadowy, union-busting billionaires as some commentators fantasize.

    Please note: The numbers employed here do not come from “right wing” or “libertarian” think tanks. They come from that hotbed of reactionary conservatism known as The Office of Management and Budget, whose director reports to President Obama. Here in Virginia, we can live in la-la land making up stories of conservative boogie men whose demented goal is to expedite the transfer of wealth from the middle class to the Koch brothers… or we can recognize reality in order to better adapt.

    One unalterable fact will shape the debate over the size and scope of federal, state and municipal government over the next decade: Interest payments on the national debt will become overwhelmingly, mind numbingly large. It is impossible to hold meaningful discussions about taxes and spending priorities without fathoming this harsh reality.

    According to projections made by the Office of Management and Budget (OMB) in its fiscal 2011 mid-year review, net interest paid on the federal national debt will metastasize from about $220 billion this year to more than $900 billion by 2020.
    That’s an increase of nearly $680 billion, and it compares to the $754 billion in increased spending planned for national security… plus discretionary domestic programs… plus Medicare… plus Medicaid. In other words, the national debt is getting so big, and growing so fast, that servicing the national debt will, at a minimum, start crowding out all other types of federal spending, including aid to states and municipalities, by the end of the decade. And that’s the optimistic view.

    The Obama administration has every interest in putting the best possible gloss on the budget forecast. Last summer’s estimate (there should be an update in February) was based on two critical assumptions: that economic growth would rebound strongly and that interest rates would remain tame throughout the decade. And, oh, by the way, the projections did not include the parting gifts from the last Congress, which extended the Bush tax cuts, temporarily reduced the payroll tax for Social Security and goosed unemployment benefits, all of which should add more than $800 billion to the national debt over the next two years.

    While the Obama administration projected the economy to come rip-roaring out of the Global Financial Crisis in an expansion rivaling the Clinton-era Internet boom, at least in the early stages, it seems increasingly apparent that the rebound will be tepid. The economy is
    improving, but it is not beating expectations. Tax revenues are likely to come in below forecast.

    As for interest rates, the U.S. Treasury has been the beneficiary of the lowest borrowing costs in decades, resulting in interest payments that are considerably below forecast. But the rock-bottom interest rates will not last long. As the economy picks up speed, private borrowing will push interest rates higher. If Europe resolves its sovereign debt crisis, hot money will flow from the safe haven of U.S. Treasuries back to Europe, pushing interest rates higher. If Europe does not solve its debt crisis, it will be because Greece, Ireland, Portugal, Hungary and perhaps even Spain have defaulted on their bonds, which will mean terrified investors will demand a risk premium for sovereign debt everywhere, including the U.S. … which will push rates higher.

    Finally, as older Boomers retire this decade, moving from the wealth accumulation phase of their lives to the wealth-drawdown phase of their lives, they will exert downward pressure on the U.S. saving rate, which will… push interest rates higher.

    What few Americans appreciate is how extraordinarily sensitive the U.S. budget is to interest rates when the national debt is $14 trillion While the Obama team assumes interest rates on 10-year Treasuries will never exceed 5.3% in the 2010s, some analysts say that rates could reach 10%. Nobody knows for sure what interest rates will do that far ahead. But it is indisputable that, if 10% interest rates transpire, they would be disastrous for the federal fisc.

    When writing my book “Boomergeddon,” I asked Chmura Economics & Analytics, a Richmond-based economic consulting firm, to run some alternate budget scenarios for me. We assumed that interest rates would stay low for three years, as the U.S. benefited from European debt woes, then started an upward march to 10% by 2020 for the reasons described above. Under that scenario, the “miracle of compound interest”—a miracle for savers—would become the “horror of compound interest” for the world’s largest borrower, the United States. Propelled by swelling interest payments, deficits and the debt would mount higher with alarming speed. According to Chmura’s projections, deficits by the end of the decade under that scenario would be running between $2.5 trillion to $2.8 trillion a year, and the national debt could reach as high as $36 trillion!

    Of course, we will never actually experience numbers like those. Financial markets would panic long before the national debt passed $30 trillion. The combination of escalating retirement benefits for the wave of aging Boomers and runaway interest payments would plunge
    the U.S. into default—an event I call Boomergeddon. Investors would stop lending money, and federal spending then would be limited to what the government brought in from taxes, perhaps 60% of what it had been spending. The other 40%, equivalent to about one tenth of the entire economy, would go poof! The economic downturn would be two or three times as intense as the recent recession, as painful as that was.

    Averting this scenario should be the No. 1 preoccupation of President Obama and the Congress. And preparing the Old Dominion to survive this trauma should be the No. 1 preoccupation of Virginia lawmakers. Our economy is more dependent than almost any other state economy upon federal spending. When Uncle Sam goes into default, the impact will be felt here first. Our AAA bond rating will not long survive a collapse in federal spending.

    Even though Boomergeddon may be 10 or 15 years off, we need to start preparing now. We cannot conduct business as usual on the assumption that the dysfunctional political system in Washington, D.C., will fix the problem. We must avoid taking on new long-term debt, fully fund our public employee obligations — trust me, it will not get any easier to do it 10 years from now—enact productivity and quality reforms in our health care system, and otherwise batten down the hatches. Boomergeddon will be quite a storm.

  • Why All the Union-Bashing?

    Posted on

    by

    James A. Bacon

    A nice person wouldn’t kick a man when he’s out of town. Not me.

    The argument about teachers’ unions and collective bargaining is too intriguing and too important especially since the right-wing crowd of Libertarians and standard Republicans have suddenly made public school teachers and other public workers the sudden targets of their drive-by shootings.

    This, of course, is driven by the rising conservative tide that washes in on cue. The GOP and Tea Party types did well in midterm elections. Swept in with the tide was Scott Walker who is making Wisconsin’s legislature a major focal point of the union-bashing movement. None other than out own esteemed Jim Bacon, feet in the Hawaiian surf and sipping a Mai Tai as we speak, predictably piled on and blamed public unions for bad teachers — which is a stretch in any human mind.

    So, I was interested in a piece by Yale’s Jacon S. Hacker and University of California at Bekerely’s Paul Pierson’s reasoned analysis in this Sunday’s Washington Post.

    They review the union movement and note that not that long ago, it was considered a useful and positive contributor to the Ameican way of life. “Unions have a secure place in our industrial life,” Dwight Eisenhower declared in 1954.

    Since then, unions have declined dramatically to about 7 percent of the general working population, the authors note. Even in the public sector the ratio is 1 in 10. In Virginia, it is zero, since Virginia has banned collective bargaining for public employees after a 1977 copurt ruling. Only two other states do the same — North Carolina and Texas. Like Virginia, they are Southern union head-busters who strove to keep unions out so they could steal industries like textiles from other areas and to hell with the average worker.

    So why the big public union bashing? No matter what the Bacons of the world would have you sizzle, public unions are not a major cause of states’ financial woes. Nor are public service workers overpaid relative to private workers, the authors say.

    What has happened is that somewhere between 1954 and today, unions shrunk while the paychecks of CEOs grew exponentially and Wall Street cheered. Somewhere, somehow, someone (The Koch brothers?) wants to put an end to unions once and for all. They’re using the midterm election upswell and the budget deficit hysteria to do so.

    Is this healthy? No, it isn’t. The authors write: “Decades of research have shown that the economic pyramid is flatter in countries where unions are stronger. In economies as different as Canada and Germany, a sturdy union presence has helped reduce income inequality. The reason isn’t just that unions defend their members. They create changes in social norms, such as pressures for nonunion employers to match union gains.”

    In America, unfortunately, we’d rather see someone like Angelo Mozilo, former head of defunct subprime lender Countrywide Financial, rake in millions than help the common man and woman.

    Globalization as trend of the last three decades is also rsponsible. Supposedly savvy thinkers moralized that layoffs and salary cuts for U.S. workers were just fine because it was just natural that those jobs went to cheaper workers in poorer countries. Funny, the people who cite this tend drive periwinkle blue Mercedes convertibles.

    Maybe this helps explain the union bashing. It sure isn’t because that powerful unions cover for lousy teachers. The issue is much, much bigger than that lame red hering.

    Peter Galuszka

Now Available

Book cover of 'Dust Mites: A Second American Revolution' by James A. Bacon, featuring astronauts planting a flag with a blue and white emblem on a lunar landscape, with Earth visible in the background.
For sale on Amazon.com

The year: 2075. The American colonies on the Moon are getting restless under Washington’s tyrannical rule….

This second edition of “Dust Mites” has a snazzy new cover, includes helpful lunar maps, and is 5,000 words tighter than the original. The sequel, “Trogs,” is scheduled for publication this summer.

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