Tony Snow said he is leaving as spokesman for the White House because he can't live on a salary of $168,000 per year, according to the Washington Post. If the average salary is something like $50,000 per year, what does this say to average people? Inflation is crazy out of control; people in hedge funds and private equity are making thousands of times more than average people, according to the Kansas City Star. Salaries in wealthy sectors are going up so fast that the government can't hope to keep up, especially when taxes on the rich people making these obscene salaries are going down instead of up.
And what does Tony Snow's resignation say about government service. For Snow, working for $168,000 a year was a tremendous sacrifice that he wouldn't continue. What about an enlisted man serving in Iraq? I don't know what he makes, but it's a lot less than $168,000 per year. Of course the deep pockets Republican sector is hiring the best special forces soldiers away from the military at something like Tony Snow's government salary to serve in the private security services in Iraq, such as Blackwater, Triple Canopy and their ilk.
It's pretty clear that Republicans and maybe most Americans of any political persuasion, love money more than they love their country.
Tuesday, September 04, 2007
Friday, August 24, 2007
Warner Less than Courageous
The George C. Marshall Foundation honored Sen. John Warner at this 2007 celebration of the 60th anniversary of the Marshall Plan. Winston Churchill praised General Marshall as the "organizer of victory." Looking at the war in Iraq, has Sen. Warner been an organizer, and has the US been victorious? No. Warner, as chairman of the Senate Armed Services committee, has presided over the destruction of the US military. Too few men and women were assigned too large a task in bringing a new government to Iraq. The military has been over-stretched and under-supplied, often lacking flack jackets and armored vehicles, even for the too few troops who were set there.
Now Warner has called for pulling out 5,000 troops of the 160,000 currently there, if the President wants to. It's almost nothing. It's too few to be noticeable, and probably too few to make a difference one way or another. It's symbolic, and that's something, but it's not much. What George Marshall did was more than symbolic. He took a small, peacetime military, much like America's today, and transformed it into a huge fighting machine that made the difference in World War II. He made hard choices; he replaced peacetime generals with generals who could fight. He drafted millions of men; he turned America's industrial base on its heels toward the production of military equipment. Bush and Warner kept their yes-man generals and gave huge tax breaks to the rich. They said, "Keep us in power and we'll give you lots of money and send some worthless farm boys and ghetto kids to die in Iraq. And we'll do it with generals who won't rock the boat." Their contempt for average Americans is boundless.
Warner may not be the worst politician in the Senate, but he certainly does not deserve to be mentioned in the same breath with General George Marshall.
Now Warner has called for pulling out 5,000 troops of the 160,000 currently there, if the President wants to. It's almost nothing. It's too few to be noticeable, and probably too few to make a difference one way or another. It's symbolic, and that's something, but it's not much. What George Marshall did was more than symbolic. He took a small, peacetime military, much like America's today, and transformed it into a huge fighting machine that made the difference in World War II. He made hard choices; he replaced peacetime generals with generals who could fight. He drafted millions of men; he turned America's industrial base on its heels toward the production of military equipment. Bush and Warner kept their yes-man generals and gave huge tax breaks to the rich. They said, "Keep us in power and we'll give you lots of money and send some worthless farm boys and ghetto kids to die in Iraq. And we'll do it with generals who won't rock the boat." Their contempt for average Americans is boundless.
Warner may not be the worst politician in the Senate, but he certainly does not deserve to be mentioned in the same breath with General George Marshall.
Bush Criticizes Cowards on Vietnam, Injures Foot
By comparing Iraq to Vietnam, Bush shot himself in the foot, as chronicled by many commentators, including this WP op-ed. Bush would have had other, poorer, less educated, less beautiful people fight on for years in Vietnam, while he partied during his ignored National Guard service. At least we tried, putting at least 500,000 troops in Vietnam for a while. Why doesn't Bush try that in Iraq? He's afraid to. But he'll probably do his best to see that the career military gets blamed for losing another war that he tried valiently to win. He'll blame the military for not fighting hard enough and not supporting him enough.
Tuesday, August 21, 2007
Tax Cuts and Moral Hazards
The main recipients of Bush's tax cuts are the same people responsible for the turmoil in the financial markets. The rich are so greedy that they first made bad mortgage loans to people who couldn't afford them. But the bad mortgages created "paper" that they could then sell to more unsuspecting buyers. Thus they could get the bad mortgages off their books and pass them off to someone else. It was a game of musical chairs until the music finally stopped and someone ended up holding some bad paper. Some people are going to get stuck with some losses, but others have made out like bandits and will have huge profits with which to take advantage of Bush's tax cuts, which particularly benefit those in hedge funds and private equity, some of the main villains in the bad-paper game.
In discussing what to do about this situation, the concept of "moral hazard" gets mentioned occasionally, as it does in this Financial Times editorial. The moral hazard concept is that you should not bail out people who got themselves in financial difficulty. It certainly applies to the hedge fund and private equity types; it is less clear that it applies to the average homeowner who might lose his house because he got a disadvantageous mortgage. There should be a level playing field. The hedge fund types certainly knew what they were doing; most have MBAs. Homeowners may or may not have known; they may have been cheated by mortgage brokers who didn't explain exactly what they were getting into. But the homeowners should have been smart enough to understand that if it sounds too good to be true, it's probably not true.
In any case, the moral hazard argument is that we should not bail out those who profited from taking risks that have now come home to roost. Therefore, in general, the Fed should not bail them out by cutting interest rates. But the economy does have a problem if the market turmoil threatens to bring on recession. It's the old story, "If you own the bank $100,000 and can't pay, you're in trouble. If you owe the bank $100,000,000 and can't pay, the bank is in trouble." So, it's possible the hedge fund types have the Fed over a barrel. But certainly the Fed should resist the temptation to bail out the market losers, like Jim Cramer of CNBC, according to Barrons. Bush has already given them a ton of help by cutting their taxes to almost nothing. Bush works for them; maybe Bernanke doesn't. Maybe he works for America. We'll see.
In discussing what to do about this situation, the concept of "moral hazard" gets mentioned occasionally, as it does in this Financial Times editorial. The moral hazard concept is that you should not bail out people who got themselves in financial difficulty. It certainly applies to the hedge fund and private equity types; it is less clear that it applies to the average homeowner who might lose his house because he got a disadvantageous mortgage. There should be a level playing field. The hedge fund types certainly knew what they were doing; most have MBAs. Homeowners may or may not have known; they may have been cheated by mortgage brokers who didn't explain exactly what they were getting into. But the homeowners should have been smart enough to understand that if it sounds too good to be true, it's probably not true.
In any case, the moral hazard argument is that we should not bail out those who profited from taking risks that have now come home to roost. Therefore, in general, the Fed should not bail them out by cutting interest rates. But the economy does have a problem if the market turmoil threatens to bring on recession. It's the old story, "If you own the bank $100,000 and can't pay, you're in trouble. If you owe the bank $100,000,000 and can't pay, the bank is in trouble." So, it's possible the hedge fund types have the Fed over a barrel. But certainly the Fed should resist the temptation to bail out the market losers, like Jim Cramer of CNBC, according to Barrons. Bush has already given them a ton of help by cutting their taxes to almost nothing. Bush works for them; maybe Bernanke doesn't. Maybe he works for America. We'll see.
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