Category Archives: Corporations

Why Teapublicans Are Wrong About Government.

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After all of the GOP talk of “freeing businesses from government regulation” and “shrinking government down to a size small enough to fit in a bathtub,” it’s time to force a dose of reality down their loudmouth throats. No matter how much they rant about the “evils” of government, we need government to do a variety of things the private sector can’t or won’t.

We need government funding and oversight to build and maintain infrastructure – roads, highways, airports, seaports, and more. We need government to protect our borders; to control our monetary system; to negotiate treaties. And, although we live in a nation built on capitalism, government has always been needed to prevent private businesses from taking advantage of our citizens. Whenever new industries are created by business, government eventually has to regulate them in order to keep them from running amok.

For example, before Ralph Nader and his book, Unsafe At Any Speed, American automakers paid little attention to safety. There were no seat belts, no air bags, no crumple zones, no crash tests…no safety standards at all.

Before the Food & Drug Administration, there was no labeling of ingredients for packaged foods ; no bans or warnings for ingredients known to cause harm. Before the Environmental Protection Agency (EPA), large corporations felt free to dump toxic chemicals in our streams and in our drinking water. Before the EPA, large corporations spewed tons of toxins into the air we breathe. Before the Securities Exchange Commission, financial institutions could engage in insider trading and sell any junk securities people could be bamboozled into buying. Before the Mine Safety Act, most miners died from tunnel collapses and black lung disease. Before the US Department of Agriculture and the US Forest Service, lumber companies felt free to clear cut our forests destroying critical habitat for many species and mortgaging our future. Before the Department of Labor, businesses thrived on child and slave labor.

Do you really want to go back to the days of allowing corporations to regulate themselves?

Would you buy meat for your family that had not been inspected? Would you drink water that hadn’t been tested for bacteria and other contaminents? Would you give your child pharamceuticals that were untested? Would you strap your child into a car that had not passed basic safety tests? Would you place your life savings in a bank that did not insure your deposits?

We already know what happens when you replace government functions with private companies. We have abundant evidence that contracting with corporations to operate prisons costs more than publicly-operated prisons. Private prisons have also proven to be less secure. We also know that, on the whole, students in private schools perform no better, and often worse, than those in public schools.

Contrary to President Reagan, government isn’t the problem. Often it’s the solution. Instead of trying to reduce government to some arbitrary size, we should be trying to improve it. Apparently, Teapublicans have never considered that.

Follow The BIG Money.

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In a previous post, I referenced a study from Bulls, Bears and the Ballot Box which found that Democratic presidents have been better for the economy than Republican presidents despite GOP claims to the contrary.

The question is why. After all, isn’t the GOP the party of business? In a word, yes, but only big business…BIG, multinational business. As a result, corporate profits, productivity, stock market prices and plentiful supplies of both cheap labor and cheap raw materials are valued above all else.

One only need look at who contributes the most money to GOP election campaigns to understand that the party doesn’t care about the needs of ordinary citizens. The party’s biggest contributors are large corporations, corporate lobbyists, the US Chamber of Commerce, plus big oil, big Pharma, big banking and other industry organizations, as well as obscenely wealthy individuals such as the Koch brothers. A recent report by The Washington Post stated that a “Koch-backed political network, designed to shield donors, raised $400 million in 2012.”

To the GOP, ordinary citizens are necessary for votes. But their votes can be bought with massive, and deceptive, ad campaigns designed to create a culture of divisiveness, anger and fear.

On the other hand, contributions for Democratic election campaigns tend to come from labor unions representing police, firefighters, teachers, workers and social organizations. The rest of the financing tends to come from individuals of every income strata. As a result, Democratic candidates tend to serve the needs of their constituents. Without their support, the candidates have little chance of being elected.

Obviously, it’s not quite so cut and dried.

Members of both parties can be swayed to pass legislation to benefit large contributors. Democrats can be romanced by large corporations offering to make large investments and to create new jobs in their districts. Such “incentives” can even affect the policies of the White House.

But the point stands. Which party do you think would be more responsive to individuals? The party that receives most of its campaign financing from large, multinational corporations and ideological billionaires? Or the party that receives a large portion of its campaign financing from working people?

I think you know the answer.

Stop Blaming Bush?

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On today’s edition of The Diane Rehm Show on NPR, a conservative asked the question, “Can we all admit that this is no longer George W. Bush’s economy?” It’s a fair question. We are, after all, about to begin the sixth year of the Obama administration. So I, for one, am more than willing to concede the point. Even though Bush’s policies crashed the economy, slashing federal revenue through tax cuts for the wealthy and leaving us mired in two unfunded wars with annual deficits in excess of $1 trillion along with massive unemployment, this is no longer Bush’s economy.

It is now quite clearly President Obama’s.

So let’s review what has happened over the past five years. To begin, President Obama signed a stimulus plan that helped stem the bleeding. He gave loans to GM and Chrysler to save the US auto industry and tens of thousands of jobs. He withdrew troops from Iraq and has promised to withdraw our troops from Afghanistan this year. He lifted American spirits by giving the order to kill or capture Osama bin Laden. He expanded health care access to millions more Americans and stemmed out-of-control inflation of health care costs.

Under President Obama, we have seen a consistent rise in GDP (Gross Domestic Product) and the stock markets. At the same time, we have seen a substantial drop in umemployment despite substantial cuts to the number of employees at all levels of government. Finally, under President Obama, we have seen the most rapid drop in the federal deficit in modern history!

And most of this has been accomplished despite a recalcitrant GOP-led House that would have us believe that the way to deal with a struggling economy is to cut federal spending and revenues. Counter to the advice of most every economist, the Teapublicans in Congress have voted against bills that would create jobs, bills that would rebuild infrastructure while interest rates are at historic lows, and programs that stimulate the economy while helping those who most need it.

So, yes indeed. This is President Obama’s economy. And it would be even better if the GOP would get out of the way!

Paying It Forward.

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Renewing the Emergency Unemployment Compensation bill would add $25.2 billion to the current federal budget. Right wing politicians and media outlets tell us that we can’t afford such “giveaways” unless they are offset by other spending cuts. Oddly, they have no such requirements for subsidies to defense contractors, the oil industry, the financial industry, big Pharma, corporate agriculture and other large interests.

But for a program that will prevent 1.3 million people from falling into the abyss? Teapublicans believe that cost needs to be offset!

Certainly saving $25.2 billion sounds good. But, in government, saving money always comes at a cost. In this case, it’s not difficult to imagine the human cost of taking away the only source of income for 1.3 million people…people who have been unemployed for six months or longer. People who are discriminated against by employers who think there must be something wrong with someone who has been unemployed for so long.

And there are other costs.

As journalist Bill Moyers reports, “Harvard economist Lawrence Katz estimates that the expiration of benefits for the long-term unemployed is costing the economy $1 billion per week.” Others estimate the cost to our economy at $400 million a week. Whichever figure is correct, that means the cost of extended unemployment benefits is already offset by what the program contributes to the economy.

Economists confirm that money spent on such programs goes directly into the economy. After all, what else are the long-term unemployed going to do with the money? Save it? Obviously, they spend it. They use it to pay for food, gasoline, utilities and other necessities. It’s not enough to allow them to live comfortably. But it helps. And that money stimulates other portions of the economy. It contributes to sales taxes. It contributes to the profits of local businesses which, in turn, pay income taxes on the money. As a result, the money finds its way back into federal, state and local governments as revenues.

It’s a win-win. It’s taxpayers paying it forward to help their struggling neighbors. Anyone who would say otherwise is cruel and heartless.

Oh wait! I just described today’s GOP.

Good News/Bad News For 2014 And Beyond.

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For the New Year, I thought it appropriate to list a few of the accomplishments from 2013. First the good news:

1 – Millions more Americans now have health insurance thanks to Obamacare. More than 2 million have signed up on the federal and state exchanges, tens of millions more will benefit from Medicaid expansion.

2 – US demand for electricity dropped in 2013. Some utilities reported a decrease in residential demand by as much as 9 percent and up to 5.9 percent overall. This is likely the result of conservation measures, such as CFL and LED light bulbs, new green construction techniques, and growth of solar and wind energy. Imagine what would happen if we ever took conservation and alternative energy seriously.

3 – The US continues to shift electricity production away from coal-burning power plants. Just this week, Arizona Public Service Co. closed three 1960s era coal-fired generators in the Four Corners region near Farmington, New Mexico. These old generators were among the nation’s dirtiest.

4 – According to the Census Bureau, the US population is growing at the slowest rate since the Great Depression – just 0.72 percent. Even if it’s the result of the Great Recession, it’s definitely good news. There will be fewer demands on our natural resources and our infrastructure. Of course, large corporations think this is terrible news since there will be more competition for customers and (gasp) workers.

Now the bad news:

According to a new study published in Nature: The International Journal of Science and reported by HuffPost, climate change could pose more significant problems than previously thought. Climate sensitivity models show that global temperatures could rise as much as 7.2 degrees Fahrenheit by 2100! The result of such an increase could be worse than the extreme storms and rising sea levels already predicted. It could be catastrophic.

Happy New Year, everyone! Be sure to stock up on sun block.

Environmental Suicide.

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Many years ago, a scientist named Paul Ehrlich convinced me of the dangers of uncontrolled population growth. He helped create an organization named Zero Population Growth (ZPG) which called for couples to have no more than two children – the number needed to replace the parents while maintaining the existing population. At the time, the world’s population stood at approximately 3.6 billion.

In 2011, the world population exceeded 7 billion!

Even today, few of the world’s governments have taken serious action to limit population growth. Discounting the effects of our never-ending wars, the exception is the one baby policy instituted by China and Indonesia. By enforcing a policy of one baby per couple, the governments hoped to improve economic conditions for their people while preserving dwindling resources. Although the populations of China and Indonesia have continued to grow, by most accounts, the policy has worked. China claims that 400,000 births have been averted. As a result, it recently announced that it will begin to relax the policy.

It seems that one of the biggest obstacles to population control is the lack of access to contraception. Population Action International estimates that as many as 215 million women around the world who want to prevent pregnancy need contraception. Many of these women are denied access to education and contraceptives by religion. This is even a problem in the Americas, especially Latin America.

That’s because the Vatican and other religious leaders have called for a ban on contraceptives and family planning. (It seems they believe that only God can decide the number of children to be born.) These religions often consider science the enemy of faith. Further, many of the same religions tell us that we have nothing to fear from over-population; that if the Earth is destroyed, the faithful will all end up in heaven. Indeed, some religious leaders are anxiously awaiting the “Rapture.”

The attitudes of politicians and corporations are nearly as bad.

In the US, some conservative politicians are trying to ban access to both contraception and abortion. In addition, many corporations see population control and environmental regulations as threats to sales growth. Any real effort to stop global warming would curb the sales of the oiligarchy. And how would corporations continue the escalation of their share prices if they couldn’t clear-cut forests, extract minerals, pillage our oceans, and create sprawling subdivisions?

Large profits require large populations.

Meanwhile, scientists the world over are screaming about the effects of over-population and the increased burning of fossil fuels. They point to alarming evidence that our environment may soon reach a tipping point. They cite statistics of rising temperatures, rising sea levels and shrinking ice shelves. They warn that lost species are like canaries in the coal mine; that the extinction of such species is a precursor to the extinction of our own.

If none of that alarms you, maybe this video will. The scientist in the video makes one of the most compelling (and frightening) arguments yet.

The Conservative War Against Labor.

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In the years following the Great Depression, labor unions were popular and thriving. The Wagner Act of 1935, also known as the National Labor Relations Act, guaranteed workers the right to collective bargaining and the right to strike. As a result, union workers, particularly those in mining and manufacturing, experienced dramatic gains in salaries and benefits, along with safer working conditions.

Corporations didn’t give up these things without a fight. But public sentiment was temporarily on the side of workers and World War II demanded unity between corporations and unions.

The end of World War II and the beginning of the Cold War gave corporations a new opportunity to undermine unions with the rise of Sen. Joseph McCarthy (R-WI) and his House Un-American Affairs Committee (HUAC). Likely emboldened by President Truman’s loyalty program intended to discredit Democratic rival Henry Wallace (former V.P. to FDR, nuclear disarmament advocate and pro-labor candidate) prior to the 1948 presidential election, McCarthy launched a witch hunt in search of communist sympathizers. News of the Soviet Union’s growing nuclear capability spawned a national paranoia that allowed McCarthy to portray labor unions as a communist front .

By the time McCarthy’s lies and un-Constitutional tactics were exposed, hundreds of Americans had been imprisoned, thousands more had lost their jobs and tens of thousands had been investigated. The victims included those who had supported Wallace, civil rights leaders, union leaders…even the unions’ rank and file.

The unraveling of the HUAC may have posed another setback for corporations and the wealthy, but McCarthy’s accusations left many suspicious of organized labor, even as labor unions continued to help build the middle class. Finally, in the 1980’s, anti-union forces suceeded in electing a president sympathetic to their cause – Ronald Reagan. When the Professional Air Traffic Controllers Organization (PATCO) went on strike, violating a law banning strikes by government workers, Reagan fired all 11,345 members who failed to return to work.

Reflecting on the event, former Federal Reserve Chairman Alan Greenspan commented, “His [Reagan’s] action gave weight to the legal right of private employers, previously not fully exercised, to use their own discretion to both hire and discharge workers.”

The war against unions resumed in earnest.

Corporations began sending jobs offshore in search of labor willing to work for low wages and without benefits such as health insurance, disability insurance and unemployment insurance. The export of jobs also eliminated the need for worker pensions. (In the years since Reagan’s election, more than 85,000 defined benefit pension funds have been eliminated.) Many of the jobs that can’t be exported, like those at Walmart and McDonald’s, now pay so little that their employees require public assistance. And with fewer workers eligible to pay dues, many labor unions have been weakened.

Meanwhile, management compensation has soared. The savings on labor costs has resulted in million dollar annual salaries and bonuses for executives.

With money comes influence allowing corporations and industries to successfully lobby Congress for subsidies, tax write-offs and lower tax rates. In addition, many corporations have been allowed to avoid taxes by creating Post Office box “headquarters” in off-shore tax havens. The resulting drop in tax revenue led to increased deficits and greater debt. But, rather than rewrite the corporate tax code and raise taxes on those who could afford it, conservatives have seized the opportunity to cut social programs. They not only cut food stamps. They have targeted Medicaid, Medicare and Social Security, as well.

Not surprisingly, conservatives have also taken aim at the labor unions which represent government workers, such as teachers, firefighters and police. In particular, they want to eliminate government pensions. The argument is that, if private workers don’t have pensions and benefits, why should government workers? If successful, conservatives will have turned the clock back to the gilded age; the days prior to labor unions; the days of extreme wealth and extreme poverty.

Some say that we already have two Americas. I would argue three.

One is the America of the one percent; those who make lots of money and pay little to no income tax; those who can buy influence by donating to political campaigns and build new businesses with government subsidies financed with the taxes paid by others.

The second is the America of hard work, limited upward mobility and shrinking investments. In this America, you work ever longer hours in order to meet the corporate demands of increased productivity. Each year, you are forced to do more with less. For you, retirement may be little more than a dream. And for your children, college will become a financial burden they may never be able to repay.

The third America is one in which people work for so little money they can’t afford many of the necessities of life. According to the Working Poor Families Project, one in three American families are now among the working poor. One in six Americans and one in four children don’t know where the next meal is coming from, or even if there will be a next meal. In this America, more than 630,000 are chronically homeless and 3.5 million will experience homelessness in a given year. For many of these people, there is little hope that their circumstances will change. They not only lack political influence, many face new laws and obstacles intended to discourage them from voting.

Both President Obama and Pope Francis have recently called economic inequality the biggest problem we face. But President Obama can’t reduce inequality in America by himself. We will need a Congress that represents all Americans. We will need a sympathetic and unified citizenry. And we will need organized labor.

(As a footnote, I should make it clear that, having become part of middle management almost immediately following college graduation, I was ineligible for union membership. But, like most Americans, I was able to take advantage of the improved working conditions, salaries and benefits negotiated by labor unions.)

We Could All Learn From “The Jerk.”

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The Jerk, starring Steve Martin, has long been one of my favorite movies. Not only is it filled with great comedy, it is filled with wisdom and life lessons. One such lesson is represented by the scene in which Martin’s character, Navin, first sees his name listed in the phone book. “I am somebody!” he exclaims.

That should be meaningful to all of us since it represents the human need for acknowledgement and respect. In fact, I believe respect is one of the most basic of human needs right after air, food and water. None of us want to think that we will journey through life without leaving a mark or even being noticed. Indeed, many human conflicts could be avoided by simply showing respect for others.

Street gangs are formed as a result of seeking a sense of belonging. Usually, they band together when the individual members feel disrespected by others in their community. And they are willing to fight and die when they are disrespected by other gangs.

Likewise, consumers experience frustration and anger when corporations and other institutions treat them as mere sources of money instead of actually working to fulfill their needs. Workers feel unappreciated and disrespected when they are paid too little money, or when extra effort goes unnoticed. Civil rights issues, such as gay marriage, are as much about respect and fairness as they are about freedom and personal liberty.

The need for respect even leads nations into war when they feel that others are trying to take advantage of them. For example, the Cold War between the Soviet Union and the United States began as the result of President Truman’s bellicose and belligerent statements that showed contempt for our World War II ally. Truman thought that, since we were the only nation to hold the secret of nuclear weapons, he could use that power to disregard prior agreements and exact new concessions from the Soviets.

In other words, Truman ignored the Soviets’ need for respect.

This is a lesson that should be considered as we enter negotiations with Iran and as we press for new trade concessions from China. It’s what both Democrats and Republicans need to consider if they are to accomplish anything that will benefit our citizens during the next session of Congress. It’s what we all need to keep in mind as we interact with each other. Not just during the holiday season, but year ‘round.

As Aretha Franklin sang, “R-E-S-P-E-C-T…I got to have a little respect.” It’s what everyone needs and deserves.

Prisoners Of Greed.

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Contrary to popular belief, crime does pay. But not in the way you think. It’s not necessarily the criminals who profit. It’s the corporations that imprison them. You see, more and more of our states are replacing state-run prisons with prisons run by private corporations. And since the US has 25 percent of the world’s prisoners and only 5 percent of the population, prisons have become a very big business.

Although crime is generally going down and the number of prisoners is shrinking, thanks to intensive lobbying efforts, we are still building more private prisons. To make matters worse, the prison corporations have contracts that dictate that they will not accept any prisoners with chronic illnesses. Their contracts guarantee 85 percent to 100 percent occupancy. Yet it has been shown that private prisons cost significantly more per prisoner than public prisons.

But cost is only one of the problems associated with private prisons. It has been reported that 78 percent of those entering prison have drug problems. Indeed, addiction is one of the contributing factors to most crimes. Yet only 6 percent receive treatment while in prison despite evidence that every dollar spent on drug treatment saves $18.02 in the cost of enforcement, court cases and incarceration.

50 percent of those in prison have committed non-violent crimes, many of them minor. But, because of its Three Strikes and You’re Out law, California has some people serving life sentences for such crimes as stealing a $69 jacket. This is not only inhumane. It’s ineffective. Criminologists know that the peak ages for crime are between 16 and 25. They also know that there is an optimum amount of punishment needed to prevent recidivism. That time varies according to the crime and the individual. If you keep someone in prison for too long, they are more likely to be violent when they get out. And since 93 percent of prisoners will eventually be released, you can see the potential for problems.

If you treat people like animals, they tend to act like animals.

Nevertheless, many politicians continue to push for more severe sentences and harsh conditions for prisoners. The mentality is to house criminals rather than rehabilitate them. Criminologists can prove that such policies don’t work. But their knowledge is often rejected because politicians have found that being “tough on crime” helps their chances for re-election.

Further, such “get tough” policies are good for the profits of private prison corporations. And the private prison corporations often contribute to political campaigns.

Unfortunately, our enormous prison population is damaging our country. It has not only harmed our human rights reputation around the globe. It has destroyed families and entire communities. 1 in 33 school children in the US have at least one parent in prison. 1 in 4 Americans have a felony record.  Moreover, a study by the Pew Research Center found that if you arrest 500 people in a community of 100,000, you disrupt the entire community. Yet there are many communities in which we have arrested as many as 750.

Criminologists know that the best deterrent to crime is certainty of punishment more than the length and severity of punishment. But our politicians pay no attention. We also know that education prevents crime. Yet we now pay 40 percent more for prisons than we do for education.

Our priorities could not be more upside-down.

The Privatization Fraud.

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For many years, the GOP has called for smaller government while, at the same time, extolling the virtues of privatization. GOP politicians have pushed for private schools through tax incentives and vouchers. In many states, they have turned the operation of prisons over to private, for-profit corporations. And thanks to the GOP, many of the operations once provided by military personnel are now provided by private contractors, such as Halliburton and Blackwater.

More recently, the GOP has pushed for privatizing Medicare through a voucher system and privatizing Social Security through private financial institutions.

The argument is that private companies can always perform tasks better and cheaper than public institutions. But before you jump on the privatization bandwagon, maybe you should ignore the rhetoric and look at studies which compare the costs and quality of services provided by private institutions with those provided by government.

Let’s begin by comparing charter schools with public schools. A 2009 report entitled Multiple Choice Charter School Performance in 16 States by the Center for Research on Education Outcomes at Stanford University found that only 17 percent of charter schools performed better than public schools while 47 percent performed at roughly the same level and 37 performed worse than public schools! This is in spite of the fact that charter schools often get to select students and usually provide few of the extra-curricular activities that public schools do.

As for prisons, a 2012 study by the Tucson Citizen found that private prisons cost the State of Arizona $3.5 million per year more than public prisons even though private prisons do not take high security prisoners or those with chronic illnesses. Ironically, the one exception is Sheriff Joe Arpaio’s Tent City. Like the name suggests, Tent City is a series of canvas tents in the desert with no heat or air conditioning. The bathrooms are portable toilets. Prisoners are made to wear pink underwear. And prisoners are served two meals a day. One meal consists of milk, juice, porridge and a hard roll. The other consists of a green baloney sandwich. Yet, despite the primitive conditions, Tent City costs more per prisoner than any other jail or prison in Arizona. Worse, recidivism is 14 percent higher than the national average.

Sheriff Joe may be the self-proclaimed “nation’s toughest sheriff” and an extreme conservative, but he is a failure as a steward of taxpayers’ money.

Nevertheless, the biggest waste of money is the privatization of our military. During the early stages of the Afghan war and the Iraq war, the Department of Defense (DoD) awarded no-bid contracts to Halliburton for everything from food service to transport and supply. In addition, the DoD handed out lucrative contracts for security services to Blackwater. The expectation was that privatizing such services would cost the US substantially less and allow the DoD to focus on military operations. But, after examining the DoD’s own documents, the Project On Government Oversight (POGO) found that private contractor employees cost 2.94 times more than an average DoD employee performing the same job!

According to POGO, in 2010 the DoD spent $254 billion for contract employees compared to $108 billion for civilian personnel directly employed by the DoD and $150 billion for military personnel.

None of this should come as a surprise to anyone. After all, the primary difference between a service provided by government and a service provided by a corporation is profit. The corporation must deliver profits in order to pay dividends to shareholders. And the corporate CEOs tend to pay themselves salaries that are many times those of government leaders. In most cases, the only way private corporations can compete with government is to reduce the scope and quality of service.

Imagine what will happen if they ever get their hooks into Medicare and Social Security!