Last week America’s Treasury Secretary Timothy Geithner said that “tax cuts for the most fortunate 2% - 3% of Americans should be allowed to expire”.  On Sunday the Secretary went on to say something that virtually no economist would agree with…..that “raising taxes on the nation’s highest income earners would NOT have a negative effect on growth”.  Who is he trying to kid?

First off let me offer a couple of facts.  Consumer spending is estimated to account for 65% -70% of GDP. Of that consumer spending, over 30% of it comes from the top 5% of income earners.   The reason so few (if any) economists would agree  that raising rates for the top tax bracket doesn’t have a negative effect on growth is because it is totally illogical to believe that reducing the discretionary income of those that spend the most wouldn’t reduce overall spending…and thus economic growth.

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When is a tax increase not a tax increase..until it is a tax increase?  The answer: The healthcare legislation commonly known as Obamacare.

The video below is an exchange between former Clinton senior political advisor George Stephanopoulos and President Obama.  The interview took place September 2009 on the ABC show This Week. 

Throughout the exchange, particularly the last half of the video, President Obama repeatedly takes Stephanopoulos to task for asking why Obamacare’s  forcing Americans to purchase healthcare insurance (or pay a penalty) is not a tax. The President declares “for us to say that you’ve got to take responsibility to get health insurance is absolutely not a tax increase”.

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For decades American presidents have been saying that the United States needs to become more energy independent.  Whether it was Jimmy Carter speaking while gas prices soared as Middle Eastern nations formed an oil cartel to increase prices, George Bush’s rhetoric in the aftermath of the 9/11 attacks, or Barack Obama saying green thinking was the pathway to new jobs and a better world.

Yet it seems as though there has been but modest alterations with regard to how the overwhelming majority of people heat their homes, transport themselves, or get their electricity for turning on a light switch.

The question is: If there is so much talk of changing our energy habits, why has there been so little actual change?

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President Barrack Obama is going before the nation tonight on national TV to speak about the oil spill in the Gulf of Mexico.  He is going to try and gain momentum for a fix to the leakage and its cleanup….discuss monetary compensation for those economically injured…..contemplate the massive environmental damage….and seek to stop the political bleeding that has captured his administration. He might even use the crisis to trumpet an energy policy that may or may not have much merit. (More on that in another post)

Unfortunately for Mr. Obama, a person can only make an initial impression once.  Likewise, a President only has one shot at his initial response to a crisis.  The judgement is in….and the American people are not pleased with the way the government has thus far handled the crisis. (And make no mistake. This is a crisis of huge proportions) 

While it is certainly possible that the next phase of this crisis, and the one after that, is handled much more adroitly than has thus far been the case…the initial Obama response to the Gulf Oil Spill has been rated UNSATISFACTORY by the American people.  

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An Israeli commando force attacked the six ships, which were carrying supplies that included cement, wheelchairs, paper and water purification systems, in international waters, 70 miles off the Gaza coast. The commandos boarded the Mavi Marmara passenger ferry, one of three ships provided by Insani Yardim Vakfi (IHH), a Turkish aid organization.   Tehran Times 

To watch Al Jazeera TV is to learn that on May 31^st, in the middle of the night, Israeli commandos stormed a humanitarian flotillia that was trying to bring aid to the people of Gaza.  Unprovoked, nine peace loving people were killed by the murderous Israelis.  Immediately Turkey, France, the European Union, Russia, the United Nations Secretary General and many others all express deep outrage.  Why would Israel, a democracy, engage in such an outrageous unlawful act of hateful brutality?

To understand the question is to know the answer.  And to know the answer  is to know some truths. 

The first truth is that from a public relations standpoint, Israel fell into the nightmare trap those hoping for its destruction had set.  That is folly on the behalf of the Israelis.  The second truth is that almost none of the statements mentioned at the top of this blog post have any relationship with reality.

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Cultural norms change.  In 1993, when Democratic President Bill Clinton initiated the “don’t ask, don’t tell” rule regarding homosexuals serving in the military, it was approved by the majority of the American people who thought it “fair”, though disapproved by the majority of those serving in the armed forces. (who thought it tampering with their institution) It was seen as a sort of compromise.  An attempt by the chief executive to not get too far ahead of society’s cultural norms, while recognizing that homosexuals had a “place” in the nation’s military.

When President Harry Truman signed executive order 9981 which integrated the military, you could say that he moved ahead of the nation in terms of what most Americans thought was appropriate. President Abraham Lincoln used black troops during the Civil War so as to strengthen his forces and for various political reasons.

Some argue that the military is not a place for ”social experimentation”.  On the surface that argument has some merit and is used by those opposed to repealing “don’t ask, don’t tell”.  However, I believe Congress, particularly Congressional Democrats, acted correctly to initiate the process by which people will be legally assured they can serve their country regardless of their sexual orientation.

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It is the constitutional responsibility of the federal government to secure the nation’s borders.  The government of the United States has completely failed in this responsibility. Now some states, such as Arizona, are responding to the desires of their citizen by taking matters into their own hands and enacting new state immigration laws. Last month, Governor Jan Brewer of Arizona signed into law (AB 1070) a measure aimed at prosecuting and deported illegal immigrants.  Both the governor’s action…..and the inaction of the federal government….are a response to political pressures.  

The law that Governor Brewer signed would allow police broad power to detain anyone they reasonably thought were in this country illegally.  It virtually forces people of color to carry on them immigration papers in case there is contact with law enforcement.

I believe that unchecked immigration is a significant problem and one that desperately needs to be addressed.  However, although over 70% of Arizonians are in favor of AB 1070, and almost 60% of all Americans agree with the new state law, I am opposed to this bill, and think it will hurt the cause of those in favor of taking strong action against illegal immigration more than it will help.

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Corporations are inherently neither good nor bad.  They are rather amoral creations.  Corporations are manmade legal constructs run by people, for people.  They strive for profits and growth, goals which almost universally animate how they are directed. As corporations pursue their best interests they provide people with employment and offer such creature comforts such as cell phones, improved washing detergent and instant coffee. They also are capable of crashing the financial system and ruthlessly firing loyal employees.

Sergey Brin is a Russian born computer whiz who emigrated from Russia to the United States when he was six years old.  His family left Russia because his parents felt oppressed because of their religion….and because of a lack of upward employment mobility. Sergey went on to co-found the search engine Google in the mid 1990’s while a student at Stanford University. Google’s company motto can roughly be translated into “do no evil”. Recently, at the urgings of Mr. Brin, Google changed its course and left the Chinese market after a five year run.  They deserve to be cheered loudly for this decision.

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The Caledonian Mercury once wrote of the British Empire, “On her dominions the sun never sets; before his evening rays leave the spires of Quebec, his morning beams have shone three hours on Port Jackson, and while sinking from the waters of Lake Superior, his eye opens upon the Mouth of the Ganges”

Grounded British Ariways planes

I’m in England as I attended my brother-in-law’s wedding Saturday. Well, I should actually be on a plane back to America, but the union called British Airways out on strike and thus I’m stranded.  The polls are showing the vast majority of Brits are against the strike, with most folks thinking that the cabin crew should be glad they have jobs given the current employment picture. 

The wedding was in London, which I assume is a locale that leans more to the right than the rest of the country.  I say that because although the groom’s family has strong pro-labour roots and traveled from Manchester (northern England), everyone I spoke to seemed very down on England’s future prospects, and told me their country was broke. Many people spoke of the huge budget deficits, and that the country seems to run on borrowed money.

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Iraqi man casting his vote

The politics of the Iraq war has been as twisted as the charred remains of a suicide bomber’s truck.  At the time of President Bush’s 2003 decision to green light American troops to move forward into Iraq, the overwhelming majority of Americans favored the conflict.  By the time the mismanagement of the post invasion had allowed a sturdy insurgency to take root, many Americans who once favored the war turned strongly against it.  They preferred our troops leave the conflict and allow the chips to fall where they would regarding the fate of Iraq and the surrounding Middle East. 

Recently Vice-President Joe Biden, someone who once gave strong voice to his policy preference of partitioning Iraq into three distinct areas, says that Iraq is one of the Obama Administration’s greatest achievements. How ironic, especially given that President Obama remains against Bush’s change in strategy towards the “surge”, a strategy which is almost universally recognized as having been decisive in moving the conflict from disaster towards “victory”.

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