You are currently browsing the monthly archive for November 2008.
Big thanks to Angie Pontani for her love. She must have liked our ridiculously thorough coverage of the burlesque festival, and invited us to come and see her show at Corio (Weekly, Thurs.-Sat.). And by “invite,” I mean free tickets, which is a big deal considering how completely broke I am these days. Congrats to Murry & Angie: this recession-proof extravaganza was sold out for both the 7:30 and 9:30 shows!
The metropolitan transit system is the most developed mass transit system in the United States. It carries workers (including me) from their houses to their jobs inside and outside the five boroughs. It is an essential piece of infrastructure for New York City, New York State, and the Tri-State area. Its importance cannot be overstated. The economic activity made possible by the transit system produces the lion’s share of taxes that go to Albany, and a sizable income for Newark and Hartford. Without the MTA millions would be unemployed.
So why did Governor Pataki try to starve it in the 90s? This is from an article in the New York Times:
At first the programs were financed with a combination of money from the state and city and borrowing. After George E. Pataki became governor in 1995, he sharply cut state funds for the capital programs and told the authority to borrow more. As a result, the last two five-year plans have been, in the words of the authority’s current executive director, Elliot G. Sander, put on a credit card.
The massive irresponsibility of the governor’s policy is all the more glaring now that the MTA is gasping for air. So why wasn’t there more of an outcry when the electorate could do something about it?
The answer is The Great Conservative Tax Swindle, also known as the Laffer Curve. The Laffer Curve is some spurious (and typically conservative) economic snake oil sold to the masses by Reagan and his legion of followers. At first it seems reasonable: if taxes are too high people won’t work. But taken to the extreme It says that all taxes are bad, and that rests on the assumption that only private capital is able to finance the public weal.
Some things are too important to be left to private initiative. In order to form a more perfect Union (as our Founding Fathers believed) we must come together as a people, and that means we will elect a government. Conservatives, deeply suspicious of government, have for the last twenty-eight years elected sabateurs whose explicit vow was to dismantle government. Deeply suspicious of public capital, they actively and openly raided the public treasury to enrich private capital. The time has come to roundly condemn this insanity. In the words of Roger Toussaint, president of Local 100 of the Transport Workers Union:
With a dramatic and historic increase in ridership, more service – not less – is needed on our subway and bus lines. Failure to maintain and reinvest in our transportation infrastructure now will result in huge costs to riders and all taxpayers down the road.
The clamor is coming from all sides: extend the bailout to the car companies.
The rationale for doing so is that it is responsible fiscal policy: only by saving automobile manufacturing jobs will we be able to save Michigan. And as Michigan goes, so goes the country.
The holes in this argument are big enough to drive a Hummer through.
In the first place, whatever happened to the jobless recovery of 2003? I thought all the manufacturing jobs were already gone?
In the second place, as I have argued before, bailing out failing industry is a mistake. A firm line must be drawn between what is public capital and what is private capital. We have worshipped in the temple of private capital for two and a half centuries, while the idea of public capital has never been adequately articulated. The agopee of “privitization”, that is making what was public capital private, came with Reagan.
The end of that privitization happened when Henry Paulson was handed the keys to the Treasury and used them to write checks to his former pals in the financial industry. “Don’t worry boys — you’ll get your Christmas bonus this year!” The same is about to happen to the Big Three if they get their “bailout”: Executives will get to save their houses, while the workers’ jobs are eliminated and shipped overseas, and their retirement is left to a non-existing public dole. GM will not be able to build giant inefficient machines in the future. The market will not allow it. To prop them up will not save jobs for workers, it will only hold open the fire escape doors long enough for the rich to get out while their house is burning down.
Real fiscal stimulus has to do what the New Deal did: guarantee the future of the Re – Public by funding public capital.
Nancy Pelosi says we should bailout GM and Chrystler. Coming on the heels of the financial bailout, this will rack up more trillions of Federal debt, and it will set a bad precedent, as I argued in an earlier post. But more to the point, as Paul Farrell has forcefully argued at Marketwatch.com today, it is an inexcusable extension of Reaganomics.
[Naomi] Klein further exposed this insanity in a recent Rolling Stone article, “The New Trough: The Wall Street bailout looks a lot like Iraq, a ‘free-fraud zone’ where private contractors cash in on the mess they helped create.” Paulson’s privatization, outsourcing and management of the $700 billion bailout has the exact same Reaganomics ideological, strategic and deceptive footprints that President George W. Bush and former Defense Secretary Donald Rumsfeld used to privatize, outsource and mismanage the costly Iraq War blunder. Yes, Paulson is America’s new Rumsfeld!
And they keep going at it! Where is Krugman’s vaunted conscience? This needs to be shouted from the rooftops until someone in government grows the testicular fortitude to do the right thing: Fiscal stimulus is an investment in public capital — not private capital.
…according to some lads who wrote the following song:
The Democrat leadership has obviously not gotten the memo on ideological shift. Here is the article from the wires.
Democratic Congressional leaders urged the Bush administration on Saturday to consider using the $700 billion bailout for the financial system to aid distressed American automakers, in a prelude to what may become urgent negotiations over additional economic stimulus measures.
This is a bad idea for so many reasons. First, it sets a bad precedent. Every progressive policy idea of the next four (let’s hope eight) years will be stained by the memory of this capitulation to corporate interests.
Second, it invites an environmental nightmare. What’s next? Bailing out the coal industry because it’s losing jobs to green energy? Bailing out AIG because they’re “too big too fail”? (Oops. Already done.) These guys are going out of business because they thought cheap gas would last forever. They are dinosaurs who deserve to die. Maybe if we’re lucky their carcasses will provide fuel for someone in one hundred million years. They even knew the good times couldn’t last, but they put that nasty thought out of their heads for instant gratification of quick profit. This is how the AP put it:
At. they called it “Blue,” a team set up around the year 2000 to design an array of small, fuel-efficient cars to compete with the Japanese. It didn’t get far because no one could figure out how to make money on low-priced compacts with Ford’s high labor costs.
Besides, the automaker was racking up billions in profits by selling pickups and. Times were good and gas was cheap.
If the government commits to maintaining failing technologies because people have jobs that depend on them we are never going to get ahead of the energy curve. If Chevron and ExxonMobil get bailouts there will be an insurrection right here in the good old U. S. of A.
Third, it validates the idea that corporations are the equivalent of citizens. It should not need to be said, so why am I saying it? Corporations are not people. They may have a lot of money, but corporations are not citizens. The business of government is citizens, not collections of citizens, or business syndicates, or legal fictions. If the Dems in Congress want to do something for the people who will be laid off if the auto companies die, put money into infrastructure or unemployment benefits. That at least will tide workers over until a true entrepreneur comes along with a better job to give these men and women. When you work in a factory it doesn’t matter if you build SUVs or hybrids — it’s all the same to the assembly worker. But if you bail out GM and Ford, all you will see for the next ten years are more SUVs and Hummers.
Look at the dark blue in Indiana. Ditto for the non-Appalachian areas of Kentucky. This is a map of the percent change from Republican to Democrat votes between 2004 and 2008. There are only two, maybe three, plausible reasons for this change. Either people all over the country so were shocked by Bush and Co.’s ineptitude that they voted for an relatively unknown and untested candidate, or they changed their minds about the core truth of conservative political philosophy. Maybe both.
Barack Obama is the president-elect of the United States. Yours truly and some friends watched the returns at the New World Theater in Midtown Manhattan — the name fit the mood.
The place was packed and richly diverse. Americans of all races were there, as were foreigners, many of whom told me my vote had extra importance because it was also their vote.
When the first good news came it was from Pennsylvania.
To say the mood was ecstatic is almost an understatement. We all knew we were on the right side of an historical moment: one that will define the truly New American Century. When Barack Obama was officially declared the winner all of New York City erupted.
When the man spoke he left not a dry eye in the house.
Even now, sitting at my desk deep in the heart of Brooklyn I can hear cars driving by pumping triumphant hip-hop. We finally have a president who represents an American hope for the 21st century. Let us have a day of rejoicing before the weight of the world falls back on our shoulders.
I know this is coming a little late, but, yeah. We endorse Obama. It’s gonna be a big party in the old City tonight. I was in the Fulton/Broadway Nassau stop of the subway, travelling from Manhattan to vote in Brooklyn this afternoon. I was reading some political essay in the New York Review of Books, and kind of dancing around the platform, echoing off the tile walls, was the sound of a steel drum. I listened for a minute and realized the guy, probably Afro-Caribbean, was playing the Battle Hymn of the Republic. “His truth is marching on!”
Bill Kristol’s Op-Ed in today’s NY Times is good for a laugh. Most of the best refutations of his inanity are already given in reader comments on the Times’s web site, so I won’t belabor the point here. Part of his analysis is right though: If self-proclaimed conservatives are out of power for two years, they will come back in a new and virulent new form in 2010. I hope, as Krugman argued, that the hateful, White elements of American conservatism have had their moment and will be thrown on the trash heap of history after tomorrow. But what will the world be like if the Congress has a solid Democratic majority and McCain becomes Prez? Even better, what if McCain dies in the first 100 days and Palin becomes Prez? Do you think the Congress would grow a pair sufficient to impeach her and all the asinine conservative ideas she stands for?
This battle is far from over, and both sides are plenty sore.
Though this article in the New York Times is feel-good real estate porn, it is also anecdotal evidence that urbanizaton might reverse the sixty year trend of suburbanization. The reasons Keyes and Woods give for moving back to the city sound like the mantra of the post baby boom, urbanist ethos.
In the summer of 2006, [Keyes and Wood] sold the Brooklyn house to friends for $2.075 million and moved to a five-bedroom colonial, circa 1920, in Maplewood, N.J. Their house there cost $930,000. Compared with other places, Maplewood, which reminded them of New England, felt more like a community and less like a bedroom suburb.
Their Brooklyn taxes were around $3,500 annually, but in Maplewood they were paying around $23,000. The good schools, they thought, would justify that amount for a family with several children, but “we could put Jillian in a really nice private school for that,” Mr. Wood said.
And Maplewood didn’t really feel like a community after all. “We had wonderful neighbors,” Mr. Wood said, “but it wasn’t the same as being in the city. Everyone got in cars and went somewhere. The only people you saw were running down to the train or jogging or walking their dog.”
Mr. Wood works from home but travels often. Ms. Keyes, alone with Jillian, now 4, felt isolated. “I underestimated how important the sense of community we developed in Brooklyn was,” she said. “I missed the restaurants and the green markets.”
Taxes are paradoxically lower in the city than in the ‘burbs; the city has more community, and this is largely due to pedestrian traffic, public transportation, and population density; prices of homes are falling in the suburbs as people become desperate to get out. This last point is of particular interest. Though gas prices may fall so far that driving is not a crushing expense and will not be as important a motivating factor moving people to the cities as it was last summer, the housing contraction may take its place as a motivator. The “broken windows” syndrome that drove whites from the urban core from World War II to the end of the Cold War may now drive them from the suburbs as unsellable houses become squats, derelict, or hideouts for crime. The process may be viral, first infecting the last, big, overdeveloped exurbs, then making its way into older suburbs until they too seem like ghost towns. If it is, the next fifty years will look considerably different than the last fifty years.
That will have an effect on politics too. The rural myth, enabled by the automobile and the suburb, that made Sarah Palin seem like a wise choice to Karl Rove will change dramatically. Will it disappear? Probably not. But it will change, and that will change what sort of candidates the rural right chose to represent them.