Here’s why the improved economy means so little

The Thinker by Rodin

The stock market is reaching record highs again, which make us moneyed people woozy. I’m modestly including myself here although I’m not that well moneyed. But I am retired on a nice pension with plenty of assets to draw on should things go south. The Dow Jones Industrial Average passed 27,000 yesterday and closed for the week at 27,322. Not bad for an index that dropped to 6547 on March 6, 2009, a little over ten years ago.

Happy days are here again? It might help to wonder why the market indexes are so high. The most recent surges are almost surely due to the Fed’s strong hinting that it’s going to reduce interest rates soon. Maybe Donald Trump’s bullying is getting to the Fed, but much more likely the Fed has read the tealeaves and suspects a recession is getting started and is trying to prevent one. And it’s enough to calm Wall Street and make them think happy days will keep on coming.

You don’t have to look hard though to find worrying signs: tariffs are slowing trade, commodity prices are dropping, and the percentage of people in the workforce keeps dropping. This is artificially keeping the unemployment statistics low. Consumers are taking on the same levels of record debt they took on before the Great Recession and Republicans have managed to repeal many of the key safeguards put in place to keep it from happening again. Student loans passed the $1T mark, sucking money from these former students’ wallets that they can’t spend on actual goods and services like houses. Perhaps in response, mortgage rates are dropping again, which is actually not a good sign. Banks are trying to entice people to buy houses, so the lower the rates go the harder time they are having finding people who can afford to take out a mortgage.

Still, many of us including me have been expecting calamity and have been wondering why we have been proven wrong. There are a few positive signs. With unemployment low, workers can bargain for higher wages and it’s working, sort of. They are beating the cost of living by .5 to 1% annually. That doesn’t translate into a whole lot of money, but it beats the decades of wage stagnation we’ve been experiencing. This is hardly the end of wage stagnation, but it is at least a hopeful sign.

Donald Trump is wondering why he isn’t getting more traction on the economy. That’s actually his one bright spot, with a slim majority approving of his handling of it, while his overall approval ratings seem mired in the low 40s. 40% of Americans still cannot find $500 to draw from in an emergency. It could be they are all inept at financial management, which is what Republicans would like you to believe.

The real reasons are much simpler. Much of today’s work requires people with fewer valuable skills, which mean they can’t command as much in wages. That’s why they are working two or three jobs to pay the bills. Even this is not enough, which is the real reason they can’t find $500 and are living paycheck to paycheck.

But there’s one other important factor that is often overlooked. Certain things cost a lot more than they used to (housing is a prime example) and there are other things that cost dramatically more than they used to. The most likely reason you will get thrown into poverty is if you need more medical care than you can afford. The Affordable Care Act was a good first step, but it wasn’t nearly affordable enough, despite the subsidies. You still needed enough income to pay for the bronze plans. And since they came with high deductibles, they mostly only bought catastrophic protection. All those deductibles, copayments and coinsurance payments cost a heap of money and all of it needs to be in the form of disposable cash, which for the most part these people don’t have. They still can’t afford to be sick. Of course, a lot of states won’t offer health care under Medicaid to these people, which they probably could afford if it were offered because copays are minimal when they exist at all. Medical price inflation is still insane and there are fewer mechanisms to check it. The magic of the free market has proven largely illusory with health care costs.

It’s no wonder then that surveys show that for most voters it’s not how well the economy is doing that matters, but how well their economy is doing — and it’s not going that great. The good news is that there is work out there for pretty much anyone who wants it. The bad news is that without a lot of high-paying skills, at best you can barely get by on the wages you are earning. Voters have figured out that health insurance really matters, and it’s their number one concern now. Those who had Obamacare realized that at least for a while it cushioned financial shocks. But they also need health care because they can get sick and simply can’t afford to get well. There are people driving hundreds of miles to Canada regularly just to buy insulin at affordable prices.

While it’s true that Donald Trump is widely seen as unlikeable and unpresidential, what voters are really understanding is that government needs to actually govern, and so little of it is happening. A president can be thrown out after four years, which is likely to happen to Trump. But we need a Congress that compromises in the public interest and tackles real problems like immigration reform and the lack of affordable health insurance ten years after Obamacare.

It may be a long wait. The Supreme Court recently decided states were perfectly free to gerrymander based on political party. In short, it’s allowing states to stay in the business of incumbent protection, making it harder and harder for people to actually have a true republican form of government. With our courts now largely in conservative hands, it’s hard to see how this can change.

Which is why Bernie Sanders’ call for a political revolution makes a whole lot of sense. Achieving it without wholesale insurrection though looks incredibly improbable.

Future generations are going to loath Republicans

The Thinker by Rodin

The Republican Party has been reaching something of a zenith lately. For a brief while they controlled Congress. They still control the White House and arguably they control the courts, at least the Supreme Court, the one that matters most. They control 33 governorships, the most since at least 1990 and have 22 trifectas: where they control both houses of state government and the governorship (Democrats have 13 trifectas.)

But it’s going to really suck to be a Republican in the future. Republicans will be loathed and it’s not hard to see why. The most obvious reason is that they did almost everything possible to not address climate change. Donald Trump will be the most loathed of the bunch, but anyone that supported his agenda will be (at best) hissed at. Fortunately, most of these prominent Republicans are wealthy enough to move to the Cayman Islands. I’d say they’d best move there ASAP. But having been to the Cayman Islands, I discovered it’s not far above sea level. As islands in the Caribbean and Gulf of Mexico go, it’s going to be one of the first to be mostly underwater as sea levels rise.

People will be looking for someone to blame, and you can basically indict the entire Republican Party. Moreover, they don’t seem to learn. In Oregon, a few Republican legislators are not showing up for work. They are trying to prevent a bill from passing that will help the state address climate change through lack of a quorum. Yes, they want Oregon to keep worsening the climate crisis. The optics of this already looks bad. Imagine how bad it will look like in ten years.

They are much worse than the No-Nothings of the 19th century. They either deny undeniable facts or believe them and simply don’t care to address them. It’s hard to say which is worse. Just not caring about the climate crisis is bad enough, but they actively support policies that will make our future even chancier and bleaker is much worse. A migration crisis is already underway, but it’s only 1% as bad as it’s going to get. Republicans are actively making it even worse.

We could be working to contain these crises, by doing things like investing in Central America so its governments are less oppressive and their citizens can have some hope for the future. Instead, to punish them we are taking away what little money we give them. And since at least Reagan, Republicans have been supporting dictators down there. The political repression in places like Honduras, Venezuela and Guatemala are driving the crisis.

Finally, the concentration camps we are creating along our border with Mexico are getting some attention. From a party that almost universally wants to force mothers to carry children to term, even if impregnated by rape or incest, they systematically abuse children in these camps. A Trump spokesman actually went to court to tell the court that these children don’t need soap or showers. It’s not just children who are being treated inhumanely, but most of the other adults too. Putting too many people into “camps” not sized for their population in the definition of a concentration camp. Yet many Republicans are aghast that some are calling them what they really are. No, they are not death camps, at least not yet, although apparently influenza and other preventable diseases are widespread within them, and many migrants have died under our custody. Still, it’s not hard to see a Donald Trump in his second term feeling empowered to turn them into death camps as yet another “final solution”.

Then of course was their rape and pillage of the rest of us: the obscene tax cuts for the wealthy, the constant cutting of benefits like food stamps and Medicare, mostly unsuccessful efforts to kill Obamacare, the dumping of more pollution into our atmosphere and waterways and the ensuing health affects they cause that are already underway. Trump apparently thinks if you can’t see the pollution, it doesn’t count: as if someone suffering from asthma won’t have worse asthma when more of these pollutants are thrown into the atmosphere. Worldwide, 6.5 million death occur annually from poor air quality. In the United States, it kills about 200,000 people a year, and those are 2013 figures. This is far more people than are killed in auto accidents annually (about 37,000 people). These numbers are likely on the rise. All this from the so-called Party of Life!

The Republican Party will be seen as the selfish death and greed party who were predominantly responsible for making our country a poorer and increasingly problematic place to live. They ignored all evidence that suggested they were wrong. Since Trump, they have labeled anything of this evidence as “fake news”, claiming it can’t possibly be correct and were deliberately faked. No one will want to be a Republican and at some point no one will admit to being a Republican because it will be too dangerous.

They are likely to get a comeuppance, and it will probably be in the form of radical income redistribution as we try, probably futilely, to save our nation and our planet. They will be lucky if people don’t come after them with pitchforks. So now would be a good time for Republicans to have sudden change of hearts, but it probably won’t make much difference to future generations that will try to cope with the wreckage they mostly caused.

Republicans, move to the Cayman Islands while you can but it’s unlikely that the citizens there will treat you any more kindly.

Why I think Trump won’t go to war with Iran

The Thinker by Rodin

Traditionally, starting a war is a pretty one good way for a president to get reelected. It worked for George W. Bush, but his Iraq war was kind of a sequel to his war with Afghanistan, seen by Americans as a justified war after 9/11. The complications of his invasion were not totally understood by voters when they gave him a second term in 2004; he essentially got the benefit of the doubt. Reagan did some gunboat diplomacy and it served him well in his reelection. We’ll never know if Kennedy’s Bay of Pigs invasion would have cost him the 1964 election. Teddy Roosevelt saw the Spanish American War as a good war, i.e. not too complicated, where America could flex its growing muscle and try the empire thing without too much cost. Much like our potential war with Iran, it didn’t have much in the way of plausible justification. Yet Teddy Roosevelt enjoyed great popularity.

The times though may be changing. Last night Donald Trump aborted three planned airstrikes on Iran while they were already in flight. Supposedly, this was because he was concerned about the reported 150 casualties that would have resulted from the strikes. (They didn’t brief him on this before authorizing the strike?) Most likely, Trump just got cold feet.

Or it could be someone on his staff looked at polling on the issue. For example, a May Reuters/Ipsos poll found that while half of Americans believe we will go to war with Iran within the next few years, 60% said the U.S. should not strike first. Also 61% of Americans still support the agreement negotiated between Iran, the Obama Administration, and many other countries to curb Iraq’s use of nuclear materials. Just 12% of Americans want us to strike first.

Iran recently shot down one of our drones near the Strait of Hormuz. It’s unclear whether it was done in international waters or not. Killing 150 people to avenge an attack on a bunch of metal does seem to be (forgive the pun) massive overkill.

It’s quite clear that Trump sees his 2020 reelection as essential and will do just about anything to achieve it. He’s already invited the Russians and other states (Norway?) to keep interfering in our elections, and Congressional Republicans seem not to care too. His reelection is literally do or die for Trump. If he can’t win reelection, then he may be charged for potential crimes documented in the Mueller report. But if he wins, the statute of limitations will pass, so at worst he’s charged for various state offenses. Starting a war with Iran is risky, but might be effective in ensuring his reelection.

Then maybe not so much. Trump is clearly no student of history, but it didn’t work well for George H.W. Bush, who ran a war against Iraq very successfully with a coalition of countries, yet still managed to lose reelection. If the 2004 elections had been held six months later, George W. Bush might not have won as the consequences of his botched Iraq war became more noticed and Americans turned decisively against it.

When it comes to armed conflict against a significant adversary, my bet is that Trump is mostly a paper tiger. He talks big about being ruthless with our enemies, but he seems to sense that running an actual war is something out of his league. To begin with, the senior leadership of his Department of Defense is largely gone. He has no Secretary of Defense, the acting one just quit and the acting-acting one is hardly the best person for the job. A president that actually managed his government would have filled these positions by now. Not Trump. He remains distracted and is unconcerned about tending to the mechanics of government. I think he senses that a conflict with Iran is better punted than acted on.

Why? Because he would actually be expected to manage the war and that’s hard and boring. It means convincing a reluctant Congress to fund it, which probably won’t happen. He would lose face and look weak. It’s much better, easier and most importantly less risky to punt on it, like he’s doing on North Korea, Venezuela or for that matter much of Central America. Many of his problems are caused by his neglect, i.e. refusal to actually govern. Governing a country at war is hard.

Reports suggest he’s already had open conflicts with John Bolton, his super-hawkish national security adviser who is openly salivating at the idea of a war with Iran. But when Trump acts on it, he’ll own it, not Bolton. Not that when it goes bad he won’t try to make others take the knee for it. But it paints a bad picture next year when he is running for reelection while this conflict likely becomes tit-for-tat actions instead. Any war or conflict with Iran will be a conflict of his own making. Remember that Trump belatedly called our Iraq War a mistake.

It’s much easier to tweet all day and make bullying noises, plus it avoids a lot of accountability. So I think he’s going to talk strong but ultimately do little in the way of a military response. I hope I’m right.

I really think Nancy Pelosi has this viable “nuclear option”

The Thinker by Rodin

I had an idea the other day on how to get at least a few things done in our federal government again. It’s going to sound crazy because I don’t think it’s been done before. But I see no reason why it couldn’t be done, if for some reason Nancy Pelosi wants to show she has real balls.

As a preface, let’s recall what the House and the Senate are empowered to do. It would seem that the Senate is the more powerful body, simply because it is empowered to do a lot of things without the consent of the House. For example, the House has no say on what treaties the U.S. signs, or who gets appointed to senior government positions like department secretaries, federal judges or ambassadors. This is because our founding fathers saw the United States as a collection of sovereign states, with Rhode Island having the same stake as California.

What unique powers does the U.S. House of Representative have? Well, they can propose legislation, but so can the Senate. Similar bills that pass both houses of Congress go to a conference committee where both houses haggle out their differences and vote on an identical bill.

But there is one area where the Senate cannot go first: on any bill that appropriates money. The U.S. constitution says funding bills must originate in the House. The Senate can propose amendments to these bills, but they can’t originate one on their own.

Our new progressive House has been passing bills right and left for the Senate to consider. They go to the Senate where Senate Majority Leader Mitch McConnell makes a show of refusing to take them up. He’s been proudly calling himself “The Grim Reaper.” This includes legislation that would pass easily on a bipartisan basis. One prominent example is legislation forwarded by the House to reimpose FCC net neutrality rules. There is arguably more important bipartisan legislation McConnell simply won’t advance, like protecting our elections from foreign interference or a path to citizenship for so-called “dreamers”.

What Nancy Pelosi could do is simply refuse to forward to the Senate any funding bill for the U.S. government until Mitch McConnell agrees in writing to advance a handful of these bipartisan bills to the Senate floor for an up or down vote.

It’s fair to say that McConnell won’t like this idea at all. But when the legislation is bipartisan it’s a lot harder to say no, particularly when the federal government must be funded. These days, most funding bills are continuing resolutions. These must originate in the House. The House can pass them long before they are needed. Nancy Pelosi though could simply keep them on her desk and refuse to move them to the Senate until she gets a letter in writing from Mitch McConnell that he will move to the floor of the Senate these likely bipartisan bills within a reasonable period of time, say a month.

Yes, Republican senators may start calling her “Shutdown Nancy”. But I bet they would cave because the American people and both parties are by definition in favor of bipartisan legislation. Pelosi and Democrats would look good for at least partially unsticking the levers of governance.

Prove to me I’m wrong, but I believe that the House does have this nuclear option. Given the intransigence in the Senate, I say it’s time to create this new weapon. Once used successfully, the House may find other ways of making government work again.

Can you profit from a likely coming recession?

The Thinker by Rodin

There are a lot of wags predicting a recession in 2020. There are wonky predictors of recession, like sustained inverted yield curves, which have accurately predicted most recessions in the past. This happens when short-term treasury bonds earn more interest than long-term bonds, which has been the case for a while now. Historically, it’s a great predictor of a recession and gives you about a year of warning.

Much of the world’s investors are already paying for negative yields, basically paying governments to take their money in the form of negative interest bonds. This sounds crazy. They do this as a hedge against currency deflation. During deflation, there is no incentive to spend money because the same dollar will buy more in the future. Fear of deflation often predicts recession too. We saw a little of this in the Great Recession when some money market accounts actually lost money, at least until new rules were created to place the full faith and credit of the U.S. government behind these accounts.

Naturally, Trump is not helping things. By initiating trade wars, principally with China, Mexico and Canada, he is injecting even more uncertainty into the markets, not to mention reducing international trade. Making willy-nilly decisions, like his recent threat to impose new tariffs on Mexico, feeds this pessimistic narrative.

It seems paradoxical that the stock market is rallying. But it’s rallying only because the Federal Reserve is suggesting it will lower interest rates. If it does, it’s only to try on the hopes of stopping a recession from happening, a recession that appears to be likely largely due to Trump’s trade policies. The Fed though doesn’t have a whole lot of flexibility as interest rates were only modestly raised since the last recession, so there’s not much room for them to fall. No wonder that so many investors are scared of the specter of deflation.

It’s been a good stretch of growth – one of the longest ever – ten years pulling out of the Great Recession. Good times never last forever anyhow, but Trump has certainly been pulling the wrong levers. We should be investing in clean technologies because that’s where future growth will come from. We should be improving our infrastructure, which is decaying around us because the economy needs a robust infrastructure to keep humming. We should be promoting higher wages so people have more money to spend, not throwing more money at millionaires and billionaires who can’t spend much of it.

Recession is coming at some point; it’s just a question of when. Most economists think the likelihood of a recession in 2020 is sixty percent. Should you be buckling down for the next recession? Given that personal credit card debt levels are as high as right before the Great Recession, it looks like many of us are not well prepared, a situation made worse by income inequality. Those who could hopefully pared down debt and created an emergency fund. But since 40% of Americans can’t afford an unexpected $400 expense, we can only hope that when the next recession comes it not as severe as the last one. Since many of the factors that got us in trouble last time are back again, largely because Republicans insist on deregulation, that doesn’t seem likely. Most Americans will simply hunker down and pray.

Looking back on my experience from the Great Recession, my takeaway is that it inadvertently made me, if not rich, a lot richer. I was blessed with a steady job that paid well and a 401K I kept contributing toward regularly. I was surprised in 2014 to discover that recovering markets made it not only possible to retire, but to retire comfortably, and I haven’t looked back. Inadvertently, I bought a lot of cheap stocks through my 401K and in just five years this was more than enough time to greatly increase my wealth.

So if you are 10-20 years away from a retirement and in a comfy job that’s unlikely to go away, then perversely you might welcome another recession because you can profit from it the way I did. If you have the nerve (something I don’t have), like a short-seller, you might want to bet against America. By this I mean, count on recession and try to profit from it.

How? If you take the bet that markets are likely at record peaks, then sell. I’m not recommending selling your entire portfolio, but it might make sense to sell a good portion of those stocks, ETFs and mutual funds and park them in U.S. treasuries, which is what a lot of investors are doing. Or you could take them as cash. You can do this with your IRA or 401K without a tax penalty. Then you just have to wait until the inevitable happens. No one can predict how much markets will decline, but if they are down 25% or more, that would be an excellent time to buy some cheap(er) stocks, ETFs and mutual funds. During the Great Recession, there was a huge sale as which discounted Grade A stocks as much as 50% from highs. After all, those who need the money to buy stuff will sell it for any price they can get, which is when bargain hunters like you swoop in. Then, like me, wait for the inevitable appreciation as stocks recover.

Will I take my own advice? Of course not! I’m retired, in my sixties, and although reasonably well off, almost all of our saving are in retirement assets. I could up my percentage of bonds and then later move them back to stocks when the market is at its low. But at my stage of my life, I want to maintain my standard of living, not necessarily gamble on some prospect ten years from now of a much larger net worth which would also be harder to enjoy before I die. Also, I pay a financial adviser to make sure we stay on plan.

But if I were a younger person like I was at the start of the last recession, then I might be taking some joy in the misfortune of others, knowing that when markets recover I would reap substantial rewards.

Trump is functionally illiterate

The Thinker by Rodin

One of last week’s biggest stories was of course the “infrastructure” meeting between Trump, House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer at the White House. It quickly blew up when Trump took offense at remarks Pelosi made earlier in the day when she accused Trump of a cover up.

His blow up looked quite staged since minutes later he was at a podium in the Rose Garden with preprinted signs that seemed to match the occasion. Also suspicious was an image captured by a photographer of Trump’s handwritten notes (written in Sharpie, of course) with prominent misspellings. Among other misspellings he noted that Democrats have “no achomlisments”.

Trump’s typos are hardly news, but these handwritten notes prove Trump is a very poor speller. He also has very poor grammar. He confuses words. On April 2nd, Trump was ranting about House Intelligence Committee Chairman Adam Schiff. He repeatedly used “oranges” when he should have used the word “origins”. Trump’s speaking is full of malapropisms. It doesn’t seem to bother his supporters. Should it bother the rest of us?

It should bother all of us because Trump is functionally illiterate. I know what you are thinking, “But what about all those tweets? He types them himself.” They tend to have occasional errors but most of the time the grammar and spelling is correct. And this is because his Twitter client points these out and suggests the correct spelling or grammar to use. We all do this, at least if we care about what we post online. Trump though sometimes slips up.

In 2016, The Washington Post compared the grammar and vocabulary levels of the major candidates at the time. Trump’s was at the bottom of the bunch: with a less than 8th grade vocabulary and less than 6th grade grammar. His speech is confusing, to say the least. My daughter does voice captioning for a living. She sometimes has to caption Trump live. Closed captioners hate translating Trump because he rarely speaks in compete sentences. Where do you place the period? It’s so hard to tell. But also, his “sentences” are rarely coherent and veer from place to place. It’s a sign of a very disordered mind that cannot think linearly.

Trump is not illiterate in the sense that he can’t read. But he can’t comprehend much of what he reads. No doubt every textbook he encountered during his education was a challenge. He misses a lot of nuance. In response, he basically doesn’t read and depends on TV and radio for information. That’s why he’s so anxious to hustle out of a meeting to watch Fox News instead: TV is the equivalent of his reading time. That’s why his staff stopped giving him briefing materials. At best he gets a one-page bullet summary of key points. Mostly he wants you to tell him information. Since it appears he is easily distracted, it’s unclear how much of what he hears he actually absorbs. To compensate, he declares himself an “extremely stable genius” and proudly proclaims most decision are made from gut feelings instead of, you know, absorbing the complex and nuanced information that staff could provide to him.

Lots of us share Trump’s disability, which may explain in part why so many people relate to him. Like him, they got through life by overcompensating in other areas and hoping that makes the difference. What his disability reveals though is a man who is far from an “extremely stable genius”. If he can’t master basic grammar and vocabulary, he’s hardly smart by any conventional definition and can’t understand a lot of the material given to him. This means he’s woefully uninformed about the many issues he has to confront and decide on as president. As for stable, someone who huffs out of a meeting after only a few minutes is hardly stable. No wonder Nancy Pelosi is openly calling for an “intervention”. I’m not sure though that Trump understands what that means. It’s one of these words with lots of syllables.

If you are functional illiterate, it means that you grasp most of the basics of reading but lack much of the ability to process and integrate the written word. And that describes Donald Trump’s entire career. It’s not just anyone who can lose a billion dollars over ten years, most of it his father’s money. But you can if you don’t know what you are doing, you can’t read a balance sheet and you run your business by talking to people on the phone instead of absorbing yourself in the minutia of your business.

It also explains why he is stonewalling Congress and blocking any attempts to reveal these underlying falsehoods. No wonder his former attorney Michael Cohen spent a lot of time sending threatening letters to places like Wharton, warning them not to publish Trump’s grades. His career is a cavalcade of false fronts. It doesn’t take too many of these to unmask this Lone Ranger for the fraud he is.

With so many potential vulnerabilities, his luck won’t hold on forever. This is why he finds being dictator much more appealing than being president: no accountability ever! Fortunately for him, the Republican Party is totally on board, because it too projects a different image of what it claims to be compared to what it actually is. It’s unclear though when he is finally unmasked – when his taxes returns show him to be the cheat that he is and his grades prove he is the ignoramus we also know he is – whether it will make a difference.

Until then we continue to have a government led by the most ignorant person ever to hold the office. We have to hope that our constitutional government can somehow survive it.

Attention Liz Warren: here’s my killer campaign idea

The Thinker by Rodin

I’ve been having a hard time getting a hold of Liz Warren, my senator and my preferred presidential candidate. She has had no trouble getting a hold of me because I’ve donated twice to her presidential campaign. Pretty much every day she (or rather her campaign) is hitting me up for more money. So far I’ve given her $100.

I’ve also tried to give her a really good idea. Replying to her many automated emails doesn’t work. Crawling her website, I did find a contact form. I first vetted my idea with my friend Tom, who works in advertising. He thinks my idea is good one, but advised that campaigns are pretty insular so they probably wouldn’t pay attention to any unsolicited suggestions. Why? First, they tend to have ad teams that do most of the media strategy and they are pretty insular and know best, unlike us unwashed masses. Second, campaigns tend to be overloaded and constantly play triage. Anything I send in as a comment goes to the bottom of the barrel, probably never to be read. I did look for a phone number that I could call, but one simply doesn’t exist.

Heeding Tom’s advice I sent a short note on their comment saying I wanted fifteen minutes of someone’s time and no I wasn’t trying to make any money. It didn’t have to be at the national level. Let me talk to someone running her campaign here in Massachusetts and if they like it they can pass it up the food chain. It’s true I didn’t say what my idea is. I don’t want them to reject it out of hand. But I will tell you and I’ll post and link to this post this on the campaign’s Facebook page. But I have a feeling it will linger there too, unread. If you like my idea, please promote it and share it. Then maybe someone will actually consider it.

Liz is my favorite for reasons I wrote about in this post. At the moment though she is just one of 23 Democrats who have announced they would like to be our next president. The good news for Liz is that she is at least in the top tier, or was before Joe Biden got into the race. She was in the #2 spot in a number of polls, but usually polls third or fourth.

Given that Liz is just 1 of 23, the challenge becomes for a candidate to distinguish themselves in a memorable way that can’t be forgotten, will command national attention and generate lots of dialogue. But how?

Like my most recent nightmare, this came to me in the middle of the night: 2 AM to be specific. This one though I could not shake. I never really got back to sleep. The next day I wrote it down and sent it off to Tom, thinking that 2 AM ideas are inherently suspicious.

Strangely, it all went back to my time in parochial schools. I spent ten years in their system. For eight of them (elementary school) the good sisters had a hard time getting our attention, particularly when recess was over. The solution: a big, loud, brass hand bell.

It was the idea of the bell that I could not shake. You cannot not hear a bell; it commands attention. And that’s what all candidates want: attention. The idea was for Liz to literally use a hand bell in her campaign and in her advertising to distinguish herself but also to rally America to the huge task ahead.

Imagine that Liz brings a hand bell to one of these to her major rallies. (Make sure there is plenty of media on hand.) Imagine if she kept it under a small box next to the lectern. As the crowd gets riled up and she moves toward the close of the rally, she raises her voice and says something like, “My friends, the status quo is simply unacceptable. Things must change!” Then she lifts the box and reveals the bell. “And so we ring this bell for change!” And she starts clanging it. People start cheering. “We are ringing this bell for future generations, so they can live on a green and peaceful earth again!” She rings the bell. “We are ringing this bell so women can have the right to make decisions about their own bodies again!” She rings the bell again and does the same for other prominent issues that must be addressed. “We are ringing this bell to restore government of the people, by the people, and for the people again!” Lots of bell ringing. Crowds cheer.

Tie this into an ad campaign. Show a student on the ground in front of Marjorie Stoneman Douglas High School in Florida, where alleged gunman Nikolas Cruz killed seventeen students and injured 17 others. There are tears in her eyes as she rings a small bell of mourning. Cut to similar scenes, like one with someone in front of a black church that was recently burned down in Louisiana. More snippets on this theme with crowds growing larger and the bells growing more intense, less mournful and more hopeful, not to mention louder. Cut to Liz at a campaign rally ringing her bell and her theme, something like: “Together, we are going to make America America again!”

Liz is the only candidate I can think of that can pull this off. But even so, it will have to be done deftly. Liz has a tendency to smile goofily sometimes. Not when ringing the bell, however. This will need to be practiced privately until she’s got the act down just right.

If it’s done right, I think it could be devastatingly effective. The bell could serve as a rallying cry and theme for the campaign. Like all good campaigns, to persuade voters it must make an emotional connection plus provides imagery and an sound and urgency that cannot be unheard. It has to hit voters on many levels simultaneously.

Ringing of bells could become features at all her rallies. People with hand bells could ring them in front of Congress, or the statehouse in Alabama, or any place where they need to be heard. It symbolizes the change that is needed and will be coming in 2020.

Liz, you gotta ring that bell!

Republicans are going for a dictatorship

The Thinker by Rodin

Things have been keeping me up at night lately. The latest thing to wake me up in a cold sweat at 4 AM was, of all things, judicial nominations. In case you haven’t noticed, Senate Majority Mitch McConnell has been working at a breakneck pace to put Trump’s judges on the federal bench. It’s pretty much all the Senate does these days.

Presidents of course are supposed to nominate people to the federal bench. It’s generally a good idea for the Senate not to tarry on these nominations as there are plenty of cases that need to be tried and in recent years federal case backlogs have been growing because of many judicial retirements. And that’s because until Trump came along, the Senate wasn’t confirming too many judgeships. Those they were confirming tended to bend toward the right side of the political spectrum.

To give you an idea of how bad it got, at the start of 2015, the last two years of Obama’s second term, there were 45 judicial vacancies. As more judges retired, Obama dutifully nominated 103 candidates, of which the Senate deigned to confirm just 22. During his last two years in office, Obama nominated 76 people. So there were a total of 98 candidates nominated by Obama, only 22 of who were confirmed. 54 nominations were returned. Effectively, less than a quarter of the nominees Obama forwarded to the Senate were confirmed in his last two years.

Obviously, Mitch McConnell was deliberately blocking these nominations, as he blocked Obama’s nomination of Merrick Garland to the Supreme Court. He was waiting for a Republican to win in 2016. Since then unsurprisingly things have picked up. After a slow 2017 where only 18 judges were confirmed (it took a while for Trump to nominate new people), 66 were confirmed in 2018 and through 7 more so far through March 2019. 91 judges that have been confirmed since Trump took office. That’s roughly four times the number that Obama got through in his last two years.

Unsurprisingly, there are no left-of-center justices being nominated or confirmed. Breaking with precedent like Mitch McConnell likes to do, he moved forward nominations that were disapproved by home state senators. Thus in the liberal 2nd Circuit which covers New York and New England, with the elevation of Judge Michael Park to the court, brought the number of Republican judges in the circuit to six. It is expected by the summer Republican judges will control the circuit court, meaning judges who disproportionately don’t have a mindset of the people they serve will be telling them what to do.

This stacking of the courts is having real world effects. Trump has plenty of reason to stack the courts because it is his “get out of jail free” card. He needs these judges to rule in his favor so he suffers no consequences for his many actions. For Republicans, it’s not so much saving Trump they care about as getting conservative judicial decisions. We got a preview of it this week when the U.S. Supreme Court broke with more than forty years of precedent in its Franchise Tax Board of California v. Hyatt decision, which overturned its Nevada v. Hall decision. Basically, the decision invalidates the idea that states have sovereign immunity for suits filed in other states. In our federal system, states are supposed to be sovereign, but not anymore. Justice Breyer basically asserted that this precedent will be used to overturn Roe v. Wade, which rests on a similar assumption.

Toward that end various red states have been chomping at the bits to outlaw abortion. They are competing against each other to come up with the most restrictive anti-abortion law, on the hopes that the Supreme Court will uphold it. Georgia’s recently signed fetal heartbeat law, which outlaws abortion if a fetal heartbeat can be detected (at about the sixth week of pregnancy, when lots of women don’t even know they are pregnant), seemed to be at the top of the heap. But then Alabama outlawed virtually all abortions, including in the case of rape or incest. Its only exception: if the mother’s life is in danger. Georgia’s law would make it a crime for a woman to get an abortion out of state, and with the Hyatt decision it looks like the Supreme Court won’t object. Women who get abortions out of states could effectively become fugitives.

Our nation appears to be on the cusp of becoming a variant of The Handmaid’s Tale. Soon, if some states have their way, an 11-year-old girl raped by her own father will be forced to carry a pregnancy to term and probably care for the child for life too. And just as the Fugitive Slave Act at one time allowed federal marshals to go into free states to return escaped slaves to their masters, it’s more than possible that women who get pregnant in Georgia but get abortions outside of Georgia may be hauled by federal marshals back to Georgia to spend thirty years in prison for their “crime” which was inflicted on them by someone else without their consent. Left off the hook, of course, are the men who got them pregnant in the first place. Women are becoming chattel again, thanks to men like Mitch McConnell.

That’s why I woke up in a cold sweat at 4 AM. By stacking the courts with judges who don’t care about the law or precedent, they are poised to turn our nation into the dictatorship that Donald Trump so desperately wants. Republicans of course are all for all of this. They don’t care about democracy. They don’t even believe in a republic. They simply want to control power now and forever through any means, and they are working the legal channels to legally appoint judges to ensure future judges will always act illegally. Moreover, there’s no clear way outside of revolution for changing this.

We should all be breaking out in cold sweats like me every night.

Monetary policy and the danger of revolution

The Thinker by Rodin

My recent post on quantum computing and its impact on cyber currencies like BitCoin have taken me exploring the world of money some more. This exploration took me to this video, which discusses who controls money and how it is created.

I think this video is meant to be shocking. Most of us are painfully aware of how important money is, because we cannot survive without it. While vital, money is also completely abstract. We like to think money is a form of permanent liquid value. This video points out the “shocking” fact that money is not this and that it is created almost universally by central banks, the Federal Reserve in the case of the United States.

As you get on in the video, you also learn that banks create money when they issue loans. If you were hoping to trade in your dollars for gold bullion, those days are gone. President Nixon turned the U.S. dollar into a fiat currency. This essentially means that the dollar has value because the government says it does. If it’s backed up by anything, it’s backed up by your faith that our government can manage money intelligently.

But really, the only ones managing money is the Federal Reserve, since they are the sole suppliers of money. The degree to which the Fed controls the spigot of money generally determines the health of the economy. Quantitative easing, which the Fed (and other central banks) have been doing since the Great Recession is basically the creation of lots of money which are then used to buy assets. Doing this helped pick up the economy and over many years took us out of recession.

So one might extrapolate that it’s not how much money that gets printed that is important, but how frequently it gets circulated. If circulated a lot, the production of goods and services continues apace. If it gets circulated too much, you end up with inflation, which means the same money buys fewer goods and services. If it’s not circulated enough, you may end up with deflation, which seems worse than inflation, in that the same money tomorrow buys more than it will today. In a deflationary environment, you would rather hold onto money than spend it, and that tends to stifle economic activity.

Lots of people like Ron Paul don’t like the way money actually works, which is why they would prefer the dollar be based on a gold standard, or some standard which equates a dollar to some amount of something precious. These people are probably economic Don Quixotes chasing electronic money windmills that may have existed at one time but which are probably gone for good. They look for impartial standards of value instead, which is why they turn dollars into BitCoin and similar electronic currencies.

The video says that central banks, being run by bankers, are a system that essentially pumps money from the lower classes to the upper classes. There’s a lot of recent evidence that they are right, as our middle class seems to be disappearing. Americans owe a lot more than they used to and in general earn a lot less in real wages than they used to. It used to be that wage increases followed productivity increases, but for decades that has not been the case. Today, the level of personal debt is staggering. Without meaningful raises, it gets harder and harder to pay off debt or do things we used to take for granted, like buy cars and homes. The Uber/Lyft phenomenon may be in part a reaction to these new facts of life.

Something ought to be done. In part, Donald Trump’s election was due to these economic anxieties. Trump was going to be our fixer to these various problems by bulldozing his way through all obstacles. Of course, he has done just the opposite. There is more than $1 trillion in outstanding student loan debt, but Trump’s education secretary Betsy DuBois is actually making it harder for people to pay off their student debts, and is promoting pricey private education at the expense of relatively affordable public education. So Trump is turning the screws even tighter on the working class.

Democratic presidential candidates have all sorts of ideas for addressing these problems. My senator, Elizabeth Warren, is distinguishing herself by having the most comprehensive set of policies for addressing these issues, including a lot of student loan debt forgiveness. All these policies though are basically ways of trying to solve the fundamental problem of more of our wealth going to the wealthiest and to put more money into those who need it the most. They all depend on redistribution of income from the wealthy toward the poor.

This “socialism” of course has the wealthy up in arms, since maintaining and increasing their wealth is all they seem to care about. So they are dead set against any of these ideas. Based on how our money supply works though, all this will do is keep pushing more of the wealth toward the wealthy.

It makes me wonder how all of this economic anxiety ends. And that gets me to figuring out what money really means. Money is essentially a social compact for the exchange of wealth, and whoever sets the rules controls the flow of wealth. The Fed is essentially accountable to no one. At best, all you can do is wait for someone’s term to expire. Trump’s inability to get people like Herman Cain on the Fed speaks to Republicans true values: they want the Fed to be populated with people that think like them, and that’s not Herman Cain. He’s too out of the mainstream.

To cut to the chase, the real threat to the wealthy is revolution. That’s exactly what happens if you screw the working class for too long. Revolution is upsetting the whole apple cart and starting over because the system is fundamentally broken and cannot be fixed. I believe this is the root of the partisan tensions we see these days. It’s not about value, or whether you are white or not; it’s about money and who gets to control it and how it should be distributed and used. Revolution though is very dangerous. It brings severe economic disruption, likely civil war, complete upheaval and a fundamental reordering of society. Hopefully when it is over the new system is more fare, but as we watch these things play out in places like Brazil it doesn’t look like that’s likely.

Ideally, rich Americans would understand that giving more back to society is in their interest. Sucking ever more wealth from the lower classes exacerbates tensions and increases the likelihood of revolution. They don’t seem to believe it though, and want to maintain control of the levers of power. If they succeed they will likely bring about the real revolution that will destroy their wealth, because wealth is predicated on connected economic systems that work. Unfortunately, the rich seem to be deliberately tone deaf, increasing the likelihood of the exact outcome they fear the most. Should it occur, BitCoin is not going to save them.

As billionaire Nick Hanauer puts it, the pitchforks are coming.

Time for Mr. Mueller to be a true patriot

The Thinker by Rodin

In case you haven’t noticed, our new attorney general Bill Barr is a horror. We shouldn’t be surprised because essentially he auditioned for his job by circulating a paper before his nomination on why the Mueller investigation was invalid.

Barr’s testimony yesterday in front of the Senate Judiciary Committee confirmed to anyone paying attention that Barr is Trump’s lackey and shill. He will do pretty much anything that Trump wants him to do because that’s how he sees his role. Which is why he thinks looking into Hillary Clinton’s emails yet again is worthy of investigation.

It’s likely to get much worse. Trump is likely to use the Justice Department as his political arm by having it open investigations into his 2020 opponents. Based on the Hillary’s email precedent, Barr shouldn’t object at all. In short, the Justice Department is becoming a new bludgeon that Trump hopes to use to win reelection. Its mission to impartially apply justice based on the law seems to be waning. In short, true justice in the Justice Department may be hard to find.

It’s painfully clear that Senate Republicans won’t check Trump in any meaningful way. It’s increasingly clear that our Supreme Court won’t either now that it has a reliable conservative majority. Trump is the outcome of over thirty years of corrupting the system to affect their ends. They don’t want democracy. They just want to be in charge and remain in charge. Which means that only voters can hold Trump and Republicans accountable.

But Trump has every incentive to corrupt the 2020 elections, and Republicans are jubilantly helping him along. Mueller’s report basically says Trump obstructed justice many times and that the only reason he wasn’t charged is because he wasn’t allowed to charge him due to Justice Department rules. With a five-year statute of limitations, if Trump loses reelection then there’s a good chance he will be prosecuted for these and many other offenses.

So in Trump’s mind he must not lose. He can see his future if he fails, and it’s inside a jail cell. He is clearly bending the power of the federal government in every way possible to stack the odds in his favor. And Republicans will aid and abet him: by making it hard for people of color to vote, through relentless gerrymandering, through fearless voter suppression and now apparently allowing the Justice Department to be used as a political weapon.

By grossly mischaracterizing Mueller’s findings, Barr’s summary of findings succeeded in muddying the waters. It’s hard to find someone without an axe to grind that the public can trust. Most won’t have time to read over four hundred pages of his report, much of it redacted. Which is why Mueller’s public testimony in front of Congress is needed. We need Mueller to rise to the occasion and be the patriot the country needs by simply telling the truth.

But will he get that chance? Trump’s policy is now to stonewall Congress and refuse to provide them any information, at least no information not in his favor. Mueller is an employee of the Justice Department, but presumably term limited as he was pulled from retirement to investigate Trump and his administration. Trump or Barr could prohibit Mueller from testifying in front of Congress. It’s unclear that they will, but it’s certainly possible if they are stonewalling everything else. It’s also unclear whether Mueller would not testify anyhow.

Polls do make one thing clear: the public trusts Robert Mueller. If anything can right this wrong ship, his testimony might. Clearly, if Mueller says things that upset Republicans, they will berate him and cast doubts on his integrity. It’s unlikely though that the public would buy it, as his integrity has so far been impeccable, unlike Donald Trump’s.

Mueller would be most helpful by simply stating the obvious: anyone other than Trump would have been prosecuted for obstruction of justice, the Justice Department is being turned into a political weapon, that government of, by and for the people is perilously close to disappearing, and the public needs to wake up and fight for its democracy.