THE FORGOTTEN 13%

The Occupy Wall Street movement has achieved two important goals by compelling us to confront both growing economic inequality and decreasing participatory democracy.  The two are linked because as wealth becomes more concentrated in fewer institutions and individuals, the capacity for the middle class (not to mention those of even lesser means) to participate in the political process becomes problematic.  This problem was exasperated when the Supreme Court saw fit to classify corporations as individuals when making campaign contributions.  Now there is no limit to wealth influencing political decision making.  There is also little opportunity for the poor to have their voices heard.

            Occupy Wall Street needs to add another category to its “99% vs. 1% slogan.  This would be the 13%.  Just over 39 million Americans live in poverty in this country.  These citizens are struggling so hard to provide food and shelter that participating in our democratic process becomes an afterthought. While the recession has widened the gap between the 99% and the 1%, the 13% are in crisis mode.  My fear is that the 99% will forget about the 13% while they protest against the 1%.

            Recently I received an e mail solicitation from Michelle Obama asking for a campaign contribution in return for the chance to dine with the Obama’s at the White House.  I sent a check.  I also gave the name of the Washington City Mission and suggested that if I won the invite, that two residents attend in my place.  The mission residents need a good meal and some participatory democracy more than me.

WATCHING OUR FUTURE UNFOLD ACROSS THE POND

The financial crisis in Europe does matter.  It is much more important to each American than the Arab fight for freedom or our own daily political theatrics.  While the media churns out stories on guns, freedom fighters and political buffoonery, our economic future is being played out across the Atlantic.  Mark Twain once noted that while history does not always repeat itself, it does rhyme.

 The financial markets often make judgments on corporations.  It is a given in a capitalist economic system.  When performance is good, corporations flourish. When performance is sub standard, the stock goes down, products go unsold, bankruptcies are filed and executives fired. 

In normal times, sovereign countries do not undergo the same scrutiny as corporations.  However, 2011 will be remembered as the year when financial markets judged countries as often as corporations. Established western nations, are no longer too big to fail. Questions on the liquidity and the credit worthiness of sovereign countries have come into play.  Market forces have eclipsed elections, international organizations and parliamentary debate.  It is now the determining factor on what the political economic and social future of the oldest, most revered European nations will hold. 

Italy and Greece have lost political leaders to failed governments and replaced them with economic technocrats.  The same has happened in Spain through an election.  All of this to please the financial markets and to stop the run on each country’s debt.  The slightest hint of good or bad news from Europe, sends the markets up or down by hundreds of points.

What was once only a whisper in European capitals is now a given. Political and fiscal power will be relinquished at the national level so that the Euro Zone can survive.  Polish leaders, in a country where fear of Germany is legendary, are practically begging the Germans to seize the moment and direct Europe away from the precipice.  Legal and economic scholars are seeking shortcuts around laws, treaties, constitutional provisions and parliamentary procedures in order to impose stop gap measures.  Preserving a credit rating trumps the slow business of democratic process.  This top down decision making feels more like China than that of a western democracy. 

The United States does not have the problems of Europe.  We make our own through partisan brinksmanship.  Our inability to reach a compromise between raising revenue and cutting the deficit has permitted the idiosyncrasies of financial markets to run the country in the absence of rational decision making.  Our credit rating is lower, our President is stone walled and our Congress is a laughing stock.

            A lesson to be learned from Europe’s dilemma is that there is very little time to spare between a plan of  “just in time-just enough” and the inevitable “too little- too late.”  As policy makers get further from the former and closer to the latter, the only course of action left becomes: “too much- right now.”   This first lesson is exasperated by a second, that helps explain the escalating crisis in Europe.  In global economics, changes take longer than anyone expected and then happen faster than anyone thought they could.

            If the United States is to avoid Europe’s fate, we must act quickly.  Policy makers that continue to take the minimal commitment to avoid immediate disaster will soon be behind the curve and forced into “too much- right now.”  Whether the cause is lack of political will or an overriding political partisanship does not really matter. Without a decisive plan things will get worse, much worse. Finally, we will act from self preservation and possibly be forced to sacrifice democratic principles. The shame will be that only a short time earlier, action would have been clearer, more effective, not as expensive and less of a hardship on our citizens.

           

OPEN INSTITUTIONS ARE TO BE ENCOURAGED

GARY E. STOUT

ATTORNEY AT LAW

78 South Wade Avenue

Washington, PA  15301

TELEPHONE (724) 228-3871

FAX (724) 228-3871

Geslaw381@gmail.com

In the middle of a week of horrendous Penn State allegations, which challenged our views on trust and the importance of open, pliable, institutions, another public enterprise stood out for me on a positive note.  Two of the Washington County election results were too close to call on election night.  The final tally, based on absentee ballots was not completed until Thursday afternoon.  The Election’s Bureau opened the final counting process to the candidates and the public. By doing so, any appearance of impropriety was avoided and the messy business of democracy upheld without rancor or accusation.

I learned several lessons from the above two tax payer supported enterprises, one large (the University), one small (the Election’s Bureau), both organized for the sole purpose of serving the public. First, transparency is always preferable to shielding a public institution or function.  Second, when an institution or function becomes so insulated that it views itself as more important than the public it serves, whatever higher purpose may have existed, becomes an afterthought.  Third, the election process and the adulation of public universities are not larger than the voice and needs of each and every citizen.  Lastly, every vote and every act of reporting suspected child abuse matters.  In both cases, the individual does make a difference.  Close elections and child predators are more the norm than the exception in our society.

 Public institutions and offices from the Presidency to the local animal control bureau exist to serve each of us.  We should admire and support only those that let the sun shine in all the cracks and crevices and that encourage the individual citizen to look under the rug and to take part in as many operations as possible.  Public venues and offices that insist on isolation and secrecy should not receive public tax dollars or our vote of confidence.

OBSERVATIONS AT THE LAST STOP ON THE RED LINE, NEW YORK CITY

When I go to New York City, it always feels like the center of the universe. Last Friday, at the end of the red line, near Trinity Church, it felt like the soul of America.  The subway stop is still called the “World Trade Center.”  Leaving the dark tunnel for the bright afternoon sunshine, the new Freedom Tower looms overhead.  Three thousand construction workers raising steel around the clock to bring the phoenix back from the ashes.

Two blocks away is Zuccotti Park.  The Occupy Wall Street festivities are in full swing.  Media, tourists, and police outnumber the protestors.  There is more talk about the coming snow storm than taking over the stock exchange.  Surprisingly, the topic of the day appears to be gas drilling in New York State, not stopping the banks. I suddenly realize the park is privately owned by Brookfield Properties and that I own the stock, subtracting from my protest credentials. Nonetheless there is the energy of a mystical vortex, as the drums beat, the video feed goes out to the world and letters, food packages and clothing pour in from around the country.

We walk another block and around the corner to the 9/11 memorial. Admission is by free ticket, downloaded from the memorial website.  My spouse tracks down the name of her classmate, former East Washington resident and 9/11 victim, Angela Reed Kyte, takes a photo and says a prayer.  I simply feel the power of the size and splendor of the twin waterfalls and infinity pools.  I hope that the newly planted swamp oaks will survive the snow storm that will ravish the city over the weekend.

As the sun begins to set, we take the short walk to the Stock Exchange.  The large bull statute is heavily guarded by police.  Every Asian tourist wants a photograph.  Somehow this symbol of power and finance, highlighting the one industry in which we still excel, feels like the source of everything that is right and wrong with America.

GREED AND FEAR IN THE GAS RUSH

With the possible exception of quantum physics and ice cream, I have come to believe that most of our world can be explained through the application of greed and fear.  There are many euphemisms that attempt to soften this reality.  The American social contract is based on the greed of economic success balanced by the fear of obeying the law.  Religions substitute gratitude for greed and the wrath of higher powers for fear.  Conservatives use capitalism for greed and socialism for fear; liberals: social leveling and the industrial, financial complex.  In the end, when the onion is peeled, it all comes down to wanting more and avoiding the taking away of what we, as individuals, find valuable.

 Stock market sages understand the dynamic.  If you study how greed and fear motivate people, you can always buy low and sell high.  It is also the basic principle of every totalitarian regime that has ever established a dictatorship.  Promise a majority of the people economic prosperity and have them fear the tribe or religion or country across the river.  The truth is that understanding greed and fear gives you power over others.

Nothing highlights human nature’s reliance on greed and fear like a good old fashion gold rush.  Make no mistake Washington County and the Marcellus shale belt, are in the middle of such an event. Here, the greed is simple to define.  Fortunes are made at the stroke of a pen. Drillers provide jobs, revenue and instant cash for access to public parks and recreation areas.  Economic booms are good for business and guarantee reelections

Fear is also everywhere, once we look behind the drillers’ billboards and commercials, telling us they are our benevolent friends:  “Sign now or be left behind.”  “Pass that regulation and we will sue and/or take our business to the next county or the next State.”  On the other side of the equation: “The science on fracking is incomplete.”  “Our water table is in danger.”  “The drillers will be gone and our beautiful County a wasteland.”

The greed and fear associated with whether to drill, is pitting individuals against families, families against towns, municipalities against counties, counties against the State, and State against State.  The drilling industry loves Pennsylvania.  To use a bad pun, a fractured political system is good for fracking.  The industry is running into reasonable checks and balances in smaller homogeneous States like New Jersey and Maryland. These Sates are more than happy to let Pennsylvania be the guinea pig so that all the problems are not repeated in their own backyards.

The present system in Pennsylvania favors the drillers.  They understand greed and fear.  The business model is to divide and conquer.  Like any good stock trader or dictator, this gives them power to achieve their goals. Exxon used the same formulae when fear and greed ran the oil industry.  Desert Bedouins understood the fear and greed game better than the oil men.  They have been playing it for centuries.  They formed OPEC and made the oil companies their employees, not their masters.

With all the recent talk about regionalization of economic, social and political concerns (the Power of 32 initiative among others) you would think that forming a Marcellus Shale Cartel that cuts across state lines would be a no brainer.  It would be the only game in town for the drillers.  They would have to come to the Cartel with hat in hand.  All environmental, tax and regulatory concerns could be vetted before the action starts. Public trust funds could be set up to repair infrastructure and address unforeseen pollution issues.

Such a plan would undoubtedly bring to the surface the greed and fear that public officials have in relinquishing local power.  My bet is that if Bedouin Chiefs that have fought each other for centuries could do it, so could our own political leaders.

A SNAPSHOT OF SKEWED VALUES

When I stand back and take stock of our political culture it often appears counter intuitive and irrational.  Let’s start with conservative Americans who need accessible education, healthcare and employment. Why would they support the tea party and rant against taxes and government programs which seek to provide these needed benefits?  On the other end of the spectrum, unionists,  members of academe and the children of our elite, sprinkled with old sixties protesters and young anarchists, camp out on Wall Street to protest the bailing out of banks.  In effect the “occupy wall street” crowd is supporting the very same tea party members who have suffered the most from the non recovery. Yet these conservatives want to leave the bankers unregulated and unscathed. 

Billionaires ask to have their taxes raised and are finding ways to give away their wealth.    Conservatives of modest means ask to have the taxes of the wealthy remain the same or lowered.  The tea party middle class have become our Herbert Hover libertarians.  The wealthy and the children of the last “me generation” are the new social democrats.

President Obama is a liberal democrat compelled to conduct his presidency as a fiscal moderate because of the state of the economy and the perceived need to move to the right for his reelection.  This is to capture more of the ground vacated by moderate republican candidates.  Mitt Romney is a moderate republican candidate who has made a Faustian bargain to become president. He has disavowed his long held policy positions.  This permits him to make a primary run as a conservative tea party libertarian in order to win his party’s nomination.  At another time and place Mr. Romney could easily serve on the President’s cabinet.

As an example of our social culture also gone whacky, we have the Steve Jobs phenomena.  Mr. Jobs was a genius at producing consumer products that by his own admission, no one knew they needed until he produced them.  His consumer consumption company is bigger than Exxon but employs very few Americans.  He was not a particularly nice man, but knew how to design and market millions of computers, music players, mobile phones and tablets.

Following his death, more media has been dedicated to Mr. Jobs life and times than any individual I can remember.  My entire issue of Business Week and much of Time magazine was dedicated to Mr. Jobs.  I learned nothing about the euro crisis and a lot about his volatile temper and that he considered taking LSD one of the most important decisions of his life.

Unfortunately lives well lived that I do care about receive almost no attention from the media.  Tony Judt was such an individual.  When he died in his early sixties from Lou Gehrig’s disease in August of 2010, the world blinked and carried on.  A politically engaged but independent and critical intellectual, Mr. Judt cared about people and about learning from history to make the world a better place. My bet is that years from now, his writings will carry more weight than the iphone.

Our political and social culture says a great deal about who we are as a people. When did our political leaders stop caring about what they believe and only about getting elected?  What’s wrong with Obama being a one term “progressive values” president or Romney running in the moderate republican tradition?   When did we stop caring about educating our children so they could compete on a level playing field as an essential part of the American dream?  How did our empathy for the less fortunate shift to the prevailing need to accumulate things, including the newest electronic toys?  Why should our culture worship Steven Jobs?

 Sometimes I cannot tell whether it is simply the media tail wagging the public dog, deciding what we think and read, or whether our values really are skewed.  Maybe it’s a bit of both.