European Bank Crisis, the G.O.P. Snake Oil Convention and a Poem from Sid

The G.O.P. Convention - Two Lies Blended Into Snake Oil   

I watched most of the Republican convention and several things impressed me.  The delegates were “old.”  Even the young ones appeared “old.”  And the speakers all seemed to be trying to sell them something.  It certainly wasn’t the predetermined candidate, Mitt Romney.  Then what was it that Ann Romney, Chris Christie, Ron Santorum, Marco Rubio, Paul Ryan, even Mitt Romney himself and all of the others were trying to sell?

Well, they started with that piece of President Obama’s statement that many business people didn’t build their businesses themselves and that their enterprise was made possible by things others did for them, such the government providing roads and bridges to transport their goods and schools to provide the education necessary to succeed.  Make up your own mind.  Here is the actual text of what the President said back on July 13 in Roanoke: 

"If you were successful, somebody along the line gave you some help. There was a great teacher somewhere in your life. Somebody helped to create this unbelievable American system that we have that allowed you to thrive. Somebody invested in roads and bridges. If you've got a business—you didn't build that. Somebody else made that happen."

Maybe it was an attention deficit problem, but all that the Republicans there heard were the four words incessantly hammered into their ears that “Mr. Business Owner, You Didn’t Build That.”   By the end of the Convention, that incomplete idea had morphed into “We Did Indeed Build It, and We Own It, and You, who Didn’t Build It, Can’t Take It Away from Us.”  This is the first lie the speakers were selling to the assembled Republicans and the “It” quickly grew from individual businesses to all of America, which by the end of the Tampa festivities, was the personal property of the good burghers there assembled. (Last people I heard claiming they "owned" America were misinformed members of the Mafia, many of whom are now serving time.)

                                                   

                                          

For Republicans who are against the social safety net functions of our government, this meant that they did not want their hard-earned dollars taken away from them and given to people who didn’t work for them, and what the speakers were saying sounded good.  Of course this was backed up by another big lie, that President Obama was withdrawing the work requirement from welfare eligibility and giving their money away to anyone who asked for it.

What he actually did was permit the states, which administer welfare locally, to change some of the rules if they could get the job done more efficiently by short-cutting some of the Health and Human Services Department’s procedures.  If a state chose to administer the work requirement differently to achieve the same result, they were free under the law to do so.  In fact, back in 2005, Governor Romney of Massachusetts petitioned the Federal Government to allow states to ask for waivers so they could administer welfare locally. 

But this “lie” reinforced that undeniably racial image in the eyes of many Republicans that the President was not only claiming that hard-working entrepreneurs didn’t build their businesses, but that the taxes they paid would be given away to lazy people on welfare who wouldn’t even be asked to seek employment.

This is what the Convention was all about.  This is the snake oil they were selling.  It’s enough to make one want to vomit.  Quite possible, Mitt will be on anti-nausea medication before the campaign is over.  

He has the nomination, but I wonder whether his stomach is strong enough to tolerate the ideas of those who are to his right, and who have nominated him only because his name on the ballot is the only way the Republicans can hope to get the independent votes they need to win the Presidency and control of both Houses of Congress.  The tragedy is that I think he knows this.

Jack Lippman  

                                              

Banking in the U.S. and in Europe

The Banking Business is complicated enough in the United States.  Some banks are regulated by states, some by the Federal government and the wall between retail banking and investment banking was breached when Glass-Steagall was repealed.  It is not an easy business to understand.

In Europe, however, this complexity is infinitely greater because each country has its own banking system, its own rules and levels of regulation and relationship to the government of that country, and that includes the nature of government “bailouts” of troubled banks.  

The European Central Bank is trying to gain a measure of control over how the banks in different countries operate.  For that to happen, the individual nations and their banks have to agree and that is a Herculean task.  It must be accomplished, however.  

If it does not happen, the whirlpool of debt which is draining the economies of some European nations will start to translate itself into business failure, unemployment, a simple barter system, hunger and homelessness.  Such debt is politely referred to as “sovereign” debt, a word not heard much a decade ago, which loosely means how much a nation's government owes.  For such debt to be properly managed throughout the European community, some “sovereignty” will have to be sacrificed to the European Central Bank in the control of their banking systems. 

And this also applies to the debt of that nation's individual business and personal borrowers.  In 2012, debt has been internationalized.  The holders of "paper" are not just in the country where the loan was made.  They are all over Europe and the world. An unpaid business loan or mortgage in Portugal, for example, not only weakens the position of the individual lender there but ultimately of the government which may have to bail out the lender.   Hence, there must be a willingness on the part of Europeans to sacrifice some financial sovereignty to deal with this problem.  The only other solutions are undesirable radical ones. 


European Centtral Bank Headquarters in Frankfurt

And of course, whatever happens in Europe will influence the United States.  To think otherwise is to wear blinders.

JL

                                                               

Sid's Corner

                                         ONE CLEVER GULL   

                                                Sid Bolotin

While sitting near the water’s edge

Dozing, meditating, writing

The shadow of a swooping gull

Caught my attention

Down it plunged as if to crash

A last minute swerve just skimmed the water’s surface

And it plucked a conch from the shallows

Soaring high over the sand

It dropped the conch

Swooped down to peck at the shell

Attempting to reach the snail inside

Unsuccessfully it repeated

The attempts over the sand

Three more times

I watched in awe

As its fourth attempt produced

A pin-point precision bombing smash

Onto a football sized rock

That failing was followed by

Three more drops onto

A dense cluster of chair-sized boulders

Requiring less precise aiming

Still unable to achieve its goal

The determined creature

Shifted tactics to increase efficiency

The gull now began bombing runs

Over the slanted rock wall running the length of the beach

Achieving zero misses on its solid facing

Four drops later

I watched one damn smart gull

Savor its reward for brainy perseverance

(Photo courtesy of Nature Framingham)


                                                               


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