Sunday, September 30, 2012

Do Americans Have to Die for Israel?

Israeli Prime Minister Netanyahu's attempt to get President Obama to join him in drawing a "red line" for the Iranian nuclear program amounts to having Obama issue an ultimatum to Iran that the US will invade if Iran crosses it.  Netanyahu's idea is apparently that Iran nuclear facilities can be knocked out by an air strike, but how badly would an air strike damage Iran's nuclear program and how would Iran retaliate.  If an air strike failed to do serious damage to the program, would the US and Israel send in ground troops?  Iran appears to be a more formidable opponent than either Iraq or Afghanistan.  If the US invaded, it would be more expensive in lives and treasure than either of those two wars. 

Unlike Israel, America does not appear to be directly threatened in the short term by an Iranian nuclear bomb.  It would be much more difficult for Iran to hit the US with a nuclear warhead than Israel, which is much closer.  Therefore, a US attack on Iran would be almost entirely for Israel's benefit. 

Israel is a close ally, but a somewhat unusual one.  The closest comparison is probably to America and Great Britain in World War II, still sometimes referred to as a "special relationship."  In the 1940s, America was pretty much an Anglo, English-speaking nation, although there had been waves of immigrants, mainly from other European countries -- Germany, Italy, Poland, Scandinavia -- with lesser influxes from Asia. Our President, Franklin Roosevelt, was of Anglo background and clearly wanted to help England and Churchill as they came under attack from Germany,but he felt he could not do much because of a lack of public support for going to war.  Lend-lease was a start, but one that kept the US out of the conflict.  The decisive event was the Japanese attack on Pearl Harbor, which brought America into the war.  Arguably there was still no reason to go to war in Europe, since Germany had not attacked the US, but it suited Roosevelt, and most of the population of the US, to go to war in Europe, actually first in North Africa, while the US moved more gradually across the Pacific towards Japan.   Ironically, England had gone to war with Germany because of Germany's invasion of Poland, but Poland ended up being lost to the Soviet Union. 

Now we have Netanyahu trying to force the US into a war with Iran, by drawing a "red line," issuing an ultimatum to Iran that if it does X, e.g. produces 225 kg of uranium hexafluoride enriched to 20%, then the US will attack it.  Should the US really do this for Israel?  The US does not like Iran; Iran held the staff of the US embassy there hostage for 444 days, until the day Ronald Reagan was sworn in to replace Jimmy Carter.  But if we really wanted to destroy the Iranian government, wouldn't we just invade Iran the way we invaded Iraq?  If it is in our national interest, we should do it.  In this case, the invasion called for by Netanyahu seems to be in Israel's interest, not necessarily ours.  An Iranian nuclear attack may be an existential threat for Israel, but not for the US.  It is a lot easier for Iran to reach Israel with a nuclear armed missile than the US, and the US is a lot bigger.  The explosion of one rudimentary nuclear weapon in the US would be terrible, but it would not be an existential threat to the nation. 

My concern is that American Jews and some American gentiles have divided loyalties.  They are more concerned about Israel than about the United States.  They are willing to sacrifice thousands of American lives to stop Iran from building a nuclear bomb that poses little threat to the US.  Unlike Anglo Americans during World War II, Jews constitute a relatively small percentage of the US population, yet they are very influential politically and economically.  They may have the political power to force the US to go to war for Israel.  Many young, relatively poor, conservative redneck Americans would probably go willingly, although the majority of the US population probably would have serious reservations about going to war again in the Middle East, especially after the war in Iraq strengthened the hand of Iran. We would have fought the Iraq war to strengthen Iran by installing a Shiite regime, and then fought a new war with Iran to weaken Iran, to undo what we did in Iraq. 

If Roosevelt had difficulty coming to the aid of England during World War II, despite America's close ties with her, I hope that we will have at least as much difficulty going to war with Iran when there is a much smaller group of Israel-loving Jews pressing for it. 

Friday, September 28, 2012

Netanyahu's Red Line

Israeli Prime Minister Netanyahu's campaign to have President Obama draw a nuclear "red line" that Iran cannot cross, amounts to having Obama issue an ultimatum that the US will invade Iran under the conditions specified in the "red line."  From his UN speech it appears that Netanyahu sets his red line at Iran's production of an amount of uranium enriched to 20% that will produce enough highly enriched uranium to build a bomb warhead, according to Reuters.   According to Wikipedia, the critical mass of U-235 metal needed for a warhead would be about 52 kilograms.  Arms Control Now says 225 kg of uranium hexafluoride enriched to 20% would be about the amount needed to produce the uranium needed for a 90% highly enriched warhead.  Uranium hexafluoride is the gas that is run through the enrichment centrifuges.  Once weapons-grade enrichment level is reached, the uranium metal is separated from the fluorine to produce the warhead.  Wikipedia says weapons grade enrichment is usually more than 85% U-235.  (Natural uranium contains only about 0.7% of the U-235 isotope.)  However, Arms Control Now reports that according to the last two IAEA reports, Iran's stockpile of 20% enriched uranium went down because Iran is using it to fuel its research reactor which needs 20% enriched uranium fuel to operate.  The latest IAEA report for August 2012 said that Iran had only 91.4 kg of 20% enriched uranium, considerably less than the 225 kg it would need for a warhead, according to IPS News.   The IAEA report for the previous quarter said that Iran then had a 20% stockpile of 101 kg. 

According to IPS, the IAEA report also said the total amount of 20% uranium hexafluoride produced by Iran rose from 143 kg in May 2012 to 189.4 kg in August 2012, or about 15 kg per month.  At this rate, to go from 91.4 kg to about 225 kg would take about 8 or 9 months, if no enriched uranium was diverted to the research reactor or other uses.  In that case, Iran would reach Netanyahu's red line around June of 2013. 

Arms Control Now says that once Iran has 225 kg of 20% enriched uranium hexafluoride, it would take about one more month to increase the enrichment to 90%.  It would also take time to convert the uranium hexafluoride to uranium metal and then to fabricate the warhead. 

Thursday, September 27, 2012

NYT Op-Eds

Two New York Times op-eds on Tuesday ended on very good points.  David Brooks lamented the Republican party's focus only on economic conservatism, to the neglect of more traditional conservative ideas.  He closed by saying:
Conservatism has lost the balance between economic and traditional conservatism. The Republican Party has abandoned half of its intellectual ammunition. It appeals to people as potential business owners, but not as parents, neighbors and citizens.

On the same page, Joe Nocera commented on the Forbes 400 list of the richest individuals.  He supported my concern about the capital gains tax as welfare for billionaires.  He said:
The American dream exists not because of the capital gains differential but in spite of it. It is the tax break that most glaringly exists to benefit the wealthy. If you have any doubts about that, all you need to do is read the latest Forbes 400.

Tuesday, September 25, 2012

Romney's Taxes

Romney's release of 2011 taxes and an accountants' statement don't do him many favors.  They do show that he paid taxes in all previous years, contrary to Sen. Reid's claim.  Otherwise, he does not do much to support America.  He paid very low taxes.  Andrea Mitchell noted that the summary of 20 years of prior taxes look higher because the tax rates were higher in previous years.  I was surprised to find the best listing of prior year tax rates in Forbes

For much of that 20 year period the top tax rate for salaried income was over 40% and the maximum capital gains tax rate was over 20%.  For 2011 the rates were 37% and 15%.  The table shows how much taxes on rich taxpayers have gone down.  When you look at Federal payroll taxes (for Social Security and Medicare) and state income taxes, sales taxes, and property taxes, the formerly "progressive" tax rates where rich pay higher taxes than the poor, have become "regressive" taxes that fall more heavily on the poor.  Romney's claim that 47% of potential taxpayers pay no taxes, ignores all taxes except federal income taxes. 

If Romney were a loyal, patriotic American earning as much as he does, he should pay something on the order of 30% of his income in federal taxes, not less than 15%. 

Romney and other Republican tax bashers say capital gains taxes have to be low, because they experience double taxation.  Their companies pay tax, and they get their investment income only after the companies are taxed.  But if the companies paid no taxes, workers salaries could be higher, too.  Why don't salaried workers get a double taxation break?  In addition, capital gains taxes are paid only after an asset is sold.  Therefore, many wealthy individuals have the earnings tax free for years. 

For example, if you buy some stock for $100, and it goes up $50 the first year.  You have made $50, but you pay no tax on it, because you don't sell it.  The next year, if the stock goes up another 50%, you make $75, but you pay no tax on that $75, plus you have made money on ALL of the profit you made the first year, because that profit was not taxed.  A salaried worker pays taxes on all of his income in the year he makes it; there is no benefit from compound interest, i.e., interest on the prior years' interest.  On the other hand, a rich person can hold a profitable asset for many years without paying any taxes on it, earning profit on the earlier profit that was not taxed.  Then when he sells it, he pays much lower taxes than someone who works for a living.  Basically the government gives him an interest free loan of the taxes due each year until he sells the asset.  Who's the "welfare queen" in this picture? 

It doesn't seem fair to me.  It's a good deal, but it's not fair. 

Year Top Regular Rates Max. Capital Gains Rate Capital Gains Taxation Notes
Wages & Other Earned Income Unearned Income Except Cap Gains Above Joint Taxable Income of
1916 15% 15% $2,000,000 15% Realized gains taxed same as other income
1917 67% 67% $2,000,000 67%
1918 77% 77% $1,000,000 77%
1919-21 73% 73% $1,000,000 73%
1922 58% 58% $200,000 12.50% Maximum rate
1923 43.50% 43.50% $200,000 12.50%
1924 46% 46% $500,000 12.50%
1925-28 25% 25% $100,000 12.50%
1929 24% 24% $100,000 12.50%
1930-31 25% 25% $100,000 12.50%
1932-33 63% 63% $1,000,000 12.50%
1934-35 63% 63% $1,000,000 31.50% Sliding exclusion of 70%>10yrs 0% <1 small="small" yr.="yr.">
1936-37 78% 78% $2,000,000 39%
1938-40 78% 78% $2,000,000 30% Excl. 50%>2yrs; 67% 18-24mo; 0%<18mo 30="30" ax="ax" small="small">
1941 80% 80% $2,000,000 30%
1942-43 88% 88% $200,000 25% Exclusion 50% > 6 months; 25% maximum

1944-45 94% 94% $200,000 25%
1946-47 86.50% 86.50% $200,000 25%
1948-49 82.10% 82.10% $200,000 25%
1950 84.40% 84.40% $200,000 25%
51-64 91% 91% $200,000 25%
64-67 70% 70% $200,000 25%
1968 75.30% 75.30% $200,000 26.90% Transition
1969 77% 77% $200,000 27.50%
1970 50% 70% $200,000 32.30%
1971 50% 70% $200,000 34.30%
1972-75 50% 70% $200,000 36.50% 50% exclusion - minimum tax effects
1976-77 50% 70% $203,200 39.90%
1978 50% 70% $203,200 39%
1979-80 50% 70% $215,400 28% 60% exclusion
1981 50% 70% $215,400 23.70% 50% or 60% exclusion
1982-86 50% 50% $215,400 20% 60% exclusion
1987 38.50% 38.50% $192,930 28% Maximum rate
1988-90* 28%/33% 28%/33% * 28%/33% Realized gains taxed same as other income
1991-92 31.90% 31.90% $82,150 28.90% Maximum rate
1993-96 43.70% 40.80% $250,000 29.20%
1997-2000 43.70% 40.80% $275,000 21.20%
2001 43.20% 40.30% $297,350 21.20%
2002 42.70% 39.80% $307,050 21.20% 18% top capital gains rate in rare cases
2003-05 39.00% 36.10% $311,950 16.10% Reduced maximum rate which also applied to dividends
2006-07 38.60% 35.70% $336,550 15.70%
2008-09 38.30% 35.40% $357,700 15.40%
2010-12 37.90% 35.00% $373,650 15%
2013-on 44.60% 44.60% $396,100 25% 21.2% income tax plus 3.8% Medicare tax; also on dividends

Thursday, September 20, 2012

Concern about Military is about Contractors

With the approach to the "fiscal cliff," there is a lot of talk about the desire to avoid cutting the Defense budget.  On its face, this appears to be concern about the fighting men and women in Afghanistan and other dangerous places, but it's really concern about defense contractors.  I don't think the Republicans really care about the people serving in the military.  Very few Republicans (or Democrats) in the House or Senate served in the military.  But they do care about their contributions from defense contractors, and about jobs in plants in their home districts.  Because of their concern about their home districts, the government had to change the whole procedure it uses to close military bases, because if handled the normal way, no base would ever be closed.  It's almost the same thing with defense contractors; every congressman wants to funnel money home to his defense contractor.  Hence, the frequent congressional mandates to build weapons systems that the Pentagon doesn't want. 

So, I am not too concerned about all the furor about saving the Defense Department budget; it's really about saving elections for incumbent congressmen and senators.  The bottom line on jobs is serious, but why should we be more concerned about keeping jobs at defense plants than anywhere else?  We need more jobs in computer companies, too, in airlines, everywhere.  Why should defense contractors get special consideration?  Because they give lots of money to the reelection campaigns of people in Congress.  It's all about the money, not about patriotism. 

Sleaze on Wall Street

I was struck reading Michael Lewis' book Boomerang about how sleazy Wall Street salesmen are.  Basically they are worse than used car salesmen, but are selling stuff worth billions.  Lewis says one of the main problems the Germans ran into during the 2008 economic crisis was that they believed the salesmen.  He says reports a conversation with Dirk Rothig, a German banker, talking about the German Landesbanks:
"The people in these banks were never spoiled by any Wall Street salesmen.  Now there is someone with a platinum American Express credit card who can take them to the Grand Prix in Monaco....  He has no limit....  All of a sudden a very smart guy from Merrill Lynch shows up and starts to pay a lot of attention to you.  They thought, 'Oh he just like me!'"
At bottom, he [Rothig]  says, the Germans were blind to the possibility that the Americans were playing the game by something other than official rules.  The Germans took the rules at their face value; they looked into the history of triple-A-rated bonds and accepted the official story that triple-A-rated bonds were completely risk-free. 
It's a shame that America has become such a corrupt country, while the Germans seemed to have maintained their moral standards.  Perhaps their terrible failings during World War II have made them more moral today, while our relatively easy course through WW II made us less concerned about our morals.  In particular Wall Street appears to have become a snake pit that has attracted some of the lowest types of humanity. 

The Rewards of Military Service

I've decided there are relatively few rewards for military service beyond those of any other job.  If the pay is good and you are not getting shot, then it's as good as any other government job.  But any idea of patriotism or idealism is out the window.  There is a lot of talk about the importance of those serving in the military, but I don't think most Americans believe it, or even if they claim to believe it, they don't act on it.  Companies tout giving jobs to veterans, but it's not because they really care about veterans; it's because it's good publicity for the company. 

If there is any psychic benefit to military service, it is only for the person who serves.  He or she can be personally proud of serving and protecting the nation but don't expect anybody else to share in that feeling.  With the rise in income inequality in the US, soldiers are not protecting their own homes and families so much as they are being paid to protect the enormous wealth of the few at the top of the pyramid.  Neither Romney, nor any of his five sons served in the military, but they are willing to pay some poor, dumb redneck to go shoot some Afghans for them. 

Things have changed for the better.  Veterans returning from Vietnam, like me, were reviled as psychotic baby killers.  After 9/11 there was a genuine increase in patriotism and a desire to protect the US from another, similar assault.  The diversion into the war in Iraq, which had nothing to do with 9/11 tended to waste that feeling and discredit the service of those who volunteered after 9/11.  The military is still more respected than it was after Vietnam, but the spirit of 9/11 is mostly dead. 

Keystone Pipeline

The Keystone pipeline is mostly out of the news now, but it's still an important issue.  Romney brings it up occasionally; Obama tries to hide it under the rug.  Obama is wrong on this issue.  The real debate is about use of fossil fuels, not possible pollution from the pipeline. The pipeline itself will have little environmental impact. There are many pipelines crisscrossing America. Most don't leak, and if they do, it's not the end of the world.

The complaints about possible pollution of Nebraska's aquifer is a red herring. Environmentalists just want to break America's dependence on oil.  Because they pipeline makes oil cheap and easy to use, they want to stop it, not because the pipeline itself will pollute.  Environmentalists argue it would be easier and safer to build a pipeline to the Pacific and ship the oil to China.  If the Chinese burn the oil, the world gets the same pollution, but America gets none of the benefits.

It's fine to have a debate about the use of fossil fuels, but it should be a straightforward debate, not one obscured by fake, legalistic arguments about an environmental impact statement for an oil pipeline. 

Thursday, September 13, 2012

Congressional Email re Foreign Service

I hope that in the light of the killing of Amb. Christopher Stevens and the attacks on the American diplomatic missions in Libya, Egypt and Yemen, you will stand up for the Foreign Service.  Gov. Romney and the Republicans have been very critical of the Foreign Service, and actually seemed to imply that Foreign Service officers deserve to die because they are wimps.  This attitude was illustrated by former Sen. Norm Coleman, Romney's surrogate on the PBS NewsHour last night, who strongly criticized the statement issued by Embassy Cairo, which PBS said, "appeared aimed at calming tensions in Egypt over an anti-Muslim film made in California."  Fortunately Amb. Nicolas Burns defended the Foreign Service, saying that Romney should not have attacked Embassy Cairo for "the actions of an embassy under siege, under great tension." (See PBS report at -

When I was in the Foreign Service many years ago, Republican Sen. Jesse Helms hated it, and would have done almost anything to eliminate it, starting with cutting the State Department budget as deeply as possible.  I worry that this same attitude persists in Washington today. 
I hope that you will stand up for the Foreign Service and not put the lives of Foreign Service officers needlessly at risk.  The Foreign Service was already under great stress because of the burden of the Iraq and Afghanistan wars; now the general increase of tensions in Middle East appears likely to increase that burden and the dangers that FSOs face.  Please support them. 

Wednesday, September 12, 2012

Sen. Mitch McConnell Is the Problem

One of the biggest problems facing America today is Senate Minority leader Kentucky Senator Mitch McConnell.  Speaker of the House John Boehner is also a problem, but he legitimately has a Republican majority in the House.  McConnell does not have a majority but through misuse of the the filibuster, he has been able to require 60 votes to pass any meaningful legislation, and since the Democrats do not have 60 votes, he has been able to block any meaningful work by the Senate.  McConnell was a draft dodger during the Vietnam War, apparently escaping service because his mentor, Sen. John Sherman Cooper of Kentucky, intervened on his behalf with his draft board or with the Army.  If McConnell loved America he would have answered his country's call during war, and he would be willing to work to salvage his country's dire fiscal situation.

The Republicans' veto power in the Senate has been particularly harmful in dealing with the country's financial crisis, and is a major concern in the run-up to the "fiscal cliff" of automatic budget cuts at the end of the year. On fiscal issues, the Republicans and the Democrats are at loggerheads, and there appears to be no path to a bipartisan solution or to one-party rule.  Meanwhile, the country continues to run up huge budget deficits.  Clinton's balanced budgets were due in large part to pressure from Newt Gingrich and his Republican majority, but today a similar scenario seems impossible.  The Republicans blame Obama, and he deserves some of it, but I think the main responsibility for the deadlock lies with the Republicans.

McConnell famously said in October 2010, "The single most important thing we want to achieve is for Obama to be a one-term president."  It would appear that the Republicans are ready to allow terrible things to happen to the US in order to defeat Obama.  Partisanship trumps patriotism   In that case, the Republicans appear to unlikely to act responsibly when we hit the "fiscal cliff."  Even now, by refusing to compromise on raising taxes along with budget cuts, the deficit and the national debt just get bigger.

A starting point for a solution already exists in the bipartisan Simpson-Bowles report.  Obama is partly responsible for not pushing harder to do something with the report, but the House and the Senate are also responsible.  The most intransigent position is the Republican opposition to any tax increases.  It has made negotiation impossible.

I don't personally know how to handle total intransigence.  I encountered it at the State Department in dealing with Reagan's Defense Department.  Richard Perle and his office were usually opposed to whatever we at State were trying to do regarding stopping missile proliferation.  They wanted an absolute guarantee from other nations on the issue, i.e., the US had to be absolutely sure that other nations would not violate the agreement, but this is impossible when dealing with human beings or other nations.  We have laws against murder, but people still commit murder.  We have laws against speeding, but people still speed.  Refusing to outlaw murder because murder will still happen seems silly to me, but that was the Republican position.  I couldn't figure out how to deal with it.  Although some other people eventually got a Missile Technology Control Regime agreement after I quit working on it because I was assigned to the embassy in Bangkok, Thailand.  I'm guessing they somehow figured out how to cut Richard Perle out of the loop.  But he showed how successful complete intransigence can be in stopping the government from working.