The Occupy Movement’s Next Move
Retaking the Offensive in the Battle of the Story
by STEVE STALLONE
For the Occupy movement, as in battlefield of the narrative, whose story is being told, whose perspective is the dominant frame, who are perceived to be the heroes and villains, the criminals and victims, is crucial.
Remember when the stock market crashed in late 2008, how it was talked about around the office printer, in newspapers and on talk shows? Remember when Lehman Brothers, Goldman Sachs and Bernie Madoff were household names spoken with disdain? When there were outraged cries for justice, televised Congressional hearings, and calls for accountability and restitution?
The mainstream media, spurred on by its journalistic tendencies, actually covered the real story of what happened—for a while. Then the right-wing spin machine fought back. Somehow the crisis was now all the fault of the greedy public sector unions, with their outrageous salaries and pensions that were bankrupting local and state governments everywhere, causing cuts in services, lowering living standards and expectations, putting popular programs like Social Security and Medicare on the chopping block again. No more mention that most all those pension funds were doing fine until Wall Street speculators and the big banksters lost so much of the money in them.
That version had some success for almost a couple of years. Then a handful of brave souls in New York City did something bold, sort of silly in its symbolism really, certainly unrealistic as a tactic. They pitched some tents, created an urban campsite and said there’s something dreadfully wrong here. So they were going to “occupy” Wall Street and refocus attention on the real culprits of the crisis.
The call to hold the masters of the economy responsible for the mess they created made a comeback, this time with a deeper understanding born of the bitter experience of the last three years. And that shared experience brought a new consciousness of the sharp class divide in modern American society, simply but effectively expressed in the “99%” slogan.
The clumsy repression of Mayor Michael Bloomberg and the NYPD broadcast the occupiers’ voices throughout the national and global media, inspiring and provoking echo demonstrations in cities everywhere, just as the Madison, Wisconsin Capitol occupiers had called forth spontaneous actions supporting public employees and services earlier this year.
The message of the “99%” resonated with working people everywhere and “normal” folks started occupations in their hometowns. Mainstream media began doing stories about heartland white people losing their jobs through no fault of their own, having their homes foreclosed on and their dreams crushed. On national TV news and in daily newspapers around the country phrases like “income inequality” and “corporate greed”—code for class society—were being constantly repeated.
Natural allies like unions saw their concerns being voiced by workers outside of the official labor movement, and joined in. Liberals and leftist clamored to be part of the new dynamic movement.
We defined the terms of debate so thoroughly that even the Oakland police, after violently trying to evict the occupation there, are now claiming to be part of the “99%.”
The right-wing spin machine was caught off guard again, but, reworking their mainstream media sources, began a new offensive. They painted the encampments as public health and safety problems, and the participants as an unruly, leaderless and unfocused mob.
The mainstream media keeps trying to say the Occupy movement has no message. What part of 99% don’t they get? The message is that America, and the world, has a highly stratified class structure and is becoming more so all the time.
But class consciousness is precisely the message the right needs to suppress most. While camping laws are minor infractions, and health and safety issues have been addressed by the occupiers organizing themselves, the fear of violence is the right’s greatest message-diversion weapon.
In Oakland the police were all too willing to oblige with that. Like the NYPD, the Oakland police attacked the campers with an unprovoked and over-the-top violent response. Nearly killing an Iraq War veteran set them back enough for the General Strike to gain momentum and the movement to claim the moral high ground.
But the mainstream media reported a few broken windows as the violence of the movement they had predicted. Somehow smashing windows was equated with bashing heads. Then the shooting death of one young African American man on the perimeter of the encampment, related or not to the occupation, seemed to confirm the right’s narrative and gave Mayor Jean Quan her excuse to evict the occupation again, as if the city had ever cared about the other more than 100 deaths in Oakland this year.
So now we are no longer talking about the 99% or the crimes of the 1%. The talk is all about violence and evicting an encampment that is both dangerous and a drain on city resources. Now the movement is all taken up with defending a batch of tents.
This has become a political liability, distracting from our real message and real work. Occupation as a tactic has outlived its usefulness. It was meant to get attention, and Occupy has certainly done that. It’s time to move on.
The vast majority of people who have participated in Occupy events, who have been moved by and echoed its core messages, have never slept over in an encampment. More than 10,000 people joined in on the General Strike activities in Oakland Nov. 2, but the encampment has never even had 200 tents there.
Which is not to say we give up on holding public space, especially Oakland’s significantly symbolic Oscar Grant Plaza. But if everyone went home at night and returned the next day to plan and carry out the continuing actions of the movement, the enemy would be disarmed—no more camping law infractions, no more health and safety issues, and hopefully the violence can be corralled. We eliminate the distractions from our core messages and focus on the real work ahead of us.
The only ones among us who would lose out are the truly homeless, who have found a relatively safe place to crash and eat. Perhaps one demand the Oakland Occupiers could make in talks with Mayor Jean Quan and the city should be for sufficient housing and services for them. It would both be practical, especially with winter weather moving in, and in line with the movement’s goals. We could claim a victory, and indeed it would be one for the poorest of our 99%.
If the Occupy movement and its resonating messages of class division and corporate accountability are to regain the offensive in these PR wars, we have to recognize when the enemy has won a battle, and readjust to the changed field of engagement. We need to rethink our tactics and perhaps reinvent them.
STEVE STALLONE was the editor of the ILWU’s newspaper The Dispatcher from 1997-2007 and worked with Jack Heyman on the Neptune Jade, Mumia and Charleston 5 campaigns. The union’s International Officers fired him for his politics in violation of his union contract. He won his arbitration against the officers and continues working as a labor journalist for Northern California’s largest public employee union, SEIU 1021, as President of the AFL-CIO affiliate the International Labor Communications Association and as Secretary of the Pacific Media Workers Guild, TNG-CWA 39521.
Sunday, November 20, 2011
Sex, Corruption and the Kool-Aid Massacre
The Legacy of Jonestown
Sex, Corruption and the Kool-Aid Massacre
by PAUL KRASSNER
November 18th marks the 33rd anniversary of the Jonestown massacre.
Jim Jones, founder of the 8,000-member People’s Temple in San Francisco, once asked Margo St. James, founder of the prostitutes’ rights group, COYOTE (Call Off Your Old Tired Ethics), how he could obtain political power.
She answered, sardonically, “Arrange for some of your women to have sex with the bigwigs.”
Jones in turn offered to supply busloads of his congregation for any protest demonstration that COYOTE organized, but Margo declined his offer.
“I never liked him,” she told me. “I never saw his eyes. Even in the dimmest light, he never removed his shades. He was hiding something. I figured it was his real feelings. I thought he was a slimy creep.”
Margo’s instincts were correct.
Potential recruits for People’s Temple were checked out in advance by Jones’ representatives, who would rummage through their garbage and report to him on their findings -– discarded letters, food preferences and other clues. Temple members would visit their homes, and while one would initiate conversation, the other would use the bathroom, copying names of doctors and types of medicine.
They would also phone relatives of a recruit in the guise of conducting a survey and gather other information that would all be taped to the inside of Jones’ podium, from which he would proceed to demonstrate his magical powers at a lecture by “sensing the presence” of an individual, mentioning specific details.
When People’s Temple moved to Guyana and became Jonestown, Jim Jones would publicly humiliate his followers. For example, he required them to remove their clothing and participate in boxing matches, pitting an elderly person against a young one. He forced one man to participate in a homosexual act in the presence of his girlfriend. There were paddle beatings and compulsory practice-suicide sessions called “White Nights.”
On November 18, 1978, Congressman Leo Ryan, who had been investigating Jonestown, was slain at the Guyana airport, along with three newspeople and several disillusioned members of the cult. Jones then orchestrated the mass suicide-murder of nine hundred men, women and children, mostly black.
Jones: “What’s going to happen here in a matter of a few minutes is that one of a few on that plane is gonna –- gonna shoot the pilot. I know that. I didn’t plan it, but I know it’s gonna happen. They’re gonna shoot that pilot and down comes the plane into the jungle. And we had better not have any of our children left when it’s over ’cause they’ll parachute in here on us. So my opinion is that we’d be kind to children and be kind to seniors and take over quietly, because we are not committing suicide. It’s a revolutionary act.”
Christine Miller: “I feel like that as long as there’s life, there’s hope. There’s hope. That’s my feeling.”
Jones: “Well, someday everybody dies. Someplace that hope runs out ’cause everybody dies.”
Miller: “But, uh, I look at all the babies and I think they deserve to live . . .”
Jones: “But also they deserve much more. They deserve peace.”
Unidentified man: “It’s over, sister, it’s over. We’ve made that day. We made a beautiful day. And let’s make it a beautiful day.”
Unidentified woman: [Sobbing] “We’re all ready to go. If you tell us we have to give our lives now, we’re ready . . .”
Jones: “The congressman has been murdered –- the congressman’s dead. Please get us some medication. It’s simple. It’s simple, there’s no convulsions with it, it’s just simple. Just please get it before it’s too late. The GDF [Guyanese army] will be here. I tell you, get moving, get moving, get moving. How many are dead? Aw, God almighty, God almighty -– it’s too late, the congressman’s dead. The congressman’s aide’s dead. Many of our traitors are dead. They’re all layin’ out there dead.”
Nurse: “You have to move, and the people that are standing there in the aisle, go stay in the radio-room yard. So everybody get behind the table and back this way, okay? There’s nothing to worry about. So everybody keep calm, and try to keep your children calm. And the older children are to help lead the little children and reassure them. They aren’t crying from pain. It’s just a little bitter tasting, but that’s –- they’re not crying out of any pain.”
Unidentified woman: “I just wanna say something to everyone that I see that is standing around and, uh, crying. This is nothing to cry about. This is something we could all rejoice about. We could be happy about this.”
Jones: “Please, for God’s sake, let’s get on with it. We’ve lived –- let’s just be done with it, let’s be done with the agony of it. [There is noise, confusion and applause.] Let’s get calm, let’s get calm. [There are screams in the background.] I don’t know who fired the shot, I don’t know who killed the congressman, but as far as I’m concerned, I killed him. You understand what I’m saying? I killed him. He had no business coming. I told him not to come. Die with respect. Die with a degree of dignity. Don’t lay down with tears and agony. Stop this hysterics. This is not the way for people who are socialistic communists to die. No way for us to die. We must die with some dignity.
“Children, it’s just something to put you to rest. Oh, God! [Crying in the background] I tell you, I don’t care how many screams you hear, I don’t care how many anguished cries, death is a million times preferable to ten more days of this life. It you’ll quit telling them they’re dying, if you adults will stop this nonsense -– I call on you to quit exciting your children when all they’re doing is going to a quiet rest. All they’re doing is taking a drink they take to go to sleep. That’s what death is, sleep. Take our life from us. We laid it down. We got tired. We didn’t commit suicide. We committed an act of revolutionary suicide, protesting the conditions of an inhuman world . . .”
Those who refused to drink the grape-flavored punch laced with potassium cyanide were either shot or killed by injections in their armpits. Jim Jones either shot himself or was murdered.
The Black Panther newspaper editorialized: “It is quite possible that the neutron bomb was used at Jonestown.”
* * *
When San Francisco District Attorney Joe Freitas learned of the killings, he was in Washington, D.C., conferring with the State Department about the mass suicide-murder in Jonestown. He immediately assumed that Moscone and Milk had been assassinated by a People’s Temple hit squad. After all, George Moscone was number one on their hit list.
Freitas had been a close friend of Jim Jones. After the massacre in Guyana, he released a previously “confidential” report, which stated that his office had uncovered evidence to support charges of homicide, child abduction, extortion, arson, battery, drug use, diversion of welfare funds, kidnapping, and sexual abuse against members of the sect. The purported investigation had not begun until after Jones left San Francisco. No charges were ever filed, and the People’s Temple case was put on “inactive status.”
Busloads of illegally registered People’s Temple members had voted in the 1975 San Francisco election, as well as in the runoff that put George Moscone in office. Freitas appointed lawyer Tim Stoen to look into possible voter fraud. At the time, Stoen was serving as Jim Jones’ chief legal adviser. Freitas later piously accused him of short-circuiting the investigation, but after Stoen left the case, the D.A.’s office assured the registrar that there was no need to retain the voting rosters, and they were destroyed.
Several former members of People’s Temple had heard about this fraudulent voting, but the eyewitnesses all died at Jonestown. In addition, the San Francisco Examiner reported that Mayor Moscone had called off a police investigation of gun-running by the Temple, which had arranged to ship explosives, weapons and large amounts of cash to South America via Canada.
George Moscone’s body was buried. Harvey Milk’s body was cremated. His ashes were placed in a box, which was wrapped in Doonesbury comic strips, then scattered at sea. The ashes had been mixed with the contents of two packets of grape Kool-Aid, forming a purple patch on the Pacific. Harvey would’ve liked that touch.
* * *
It was well known around City Hall that Moscone had a predilection for black women. Police almost arrested him once with a black prostitute in a car at a supermarket parking lot.
Soon after the Dan White trial, I got a phone call from Lee Cole, an ex-Scientologist I had met in Chicago while researching the Charles Manson case. He wanted to visit me, but I said no.
“Suppose I just come over?” he said.
“You don’t know where I live.”
“I can find out.”
“If you find out, and you tell me how you did, you can come over.”
I wanted to determine how carefully I had covered my tracks, or see which friend would give out my address. A little while later, Lee Cole called again and told me my address -– he said that he had obtained it from the voter registration files –- so I told him to come over.
He took me to see Lowell Streiker, author of The Cults Are Coming! and a deprogrammer who had counseled one-third of the Jonestown survivors. In the course of our conversation, I mentioned my theory that Jim Jones had served as a pimp at City Hall and maintained power by implied blackmail.
Dr. Streiker told me of his friend -– a member of Jones’ planning commission –- who had told him about the technique that People’s Temple had used on Mayor Moscone. They sent a young black female member to service him, as a gift, then called the next week about a serious problem –- she had lied, said she was eighteen, when in fact she was underage, but don’t worry, we have it under control -– just the way J. Edgar Hoover used to manipulate top politicians with his juicy FBI files.
So Jim Jones had taken Margo St. James’ sardonic advice after all, on how to achieve political power: “Arrange for some of your women to have sex with the bigwigs.” And he had taken it all the way to a mass suicide-murder –- which occurred simultaneously with a mass demonstration by the women’s movement in San Francisco, called “Take Back the Night!”
They completely shut down traffic on Broadway. But there was not a word about that event in any of the media. It was knocked totally out of the news by the massacre in Jonestown.
Jonestown and Kool-Aid continue to serve as occasional joke references for stand-up comedians and metaphors for politicians and pundits alike.Paul Krassner’s dialogue with Andrew Breitbart appears in the December issue of Playboy. He is a contributor to Hopeless: Barack Obama and the Politics of Illusion, forthcoming from AK Press.
First Steps in Reforming the U.S. Financial and Tax System
What is to be Done? Since You Ask…
First Steps in Reforming the U.S. Financial and Tax System
by MICHAEL HUDSON
The Occupy Wall Street movement has many similarities with what used to be called the Great Awakening periods in America. Such periods always begin by realizing how serious the problem is. So diagnosis is the most important tactic. Diagnosing the problem mobilizes power for a solution. Otherwise, solutions will seem to come out of thin air and people won’t understand why they are needed, or even the problems that solutions are intended to cure. The basic problem today is that nearly everyone is in debt. This is the problem in Europe too. There are Occupy Berlin meetings, the Greek and Icelandic protests, Spain’s “Indignant” demonstrations and similar ones throughout the world.
When debts reach today’s proportions, a basic economic principle is at work: Debts that can’t be paid; won’t be. The question is, just how are they not going to be paid? People with student loans are not permitted to declare bankruptcy to get a fresh start. The government or collection agencies dock their salaries and go after whatever property they have. Many people’s revenue over and above basic needs is earmarked to pay the bankers. Typical American wage earners pay about 40 percent of their wages on housing whose price is bid up by easy mortgage credit, and another 10 to 15 percent for credit cards and other debt service. FICA takes over 13 per cent, and federal, local and sales taxes another 15 percent or so. All this leaves only about a quarter of many peoples’ paychecks available for spending on goods and services. This is what is causing today’s debt deflation. And Wall Street is supporting it, because it extracts income from the bottom 99% to pay the top 1%.
Half a century ago most economists imagined that the problem would be people saving too much as they got richer. Saving meant non-spending. But the problem has turned out to be just the opposite: debt. Overall, salaries have not risen in decades, so many people have borrowed just to break even. Instead of an era of free choice, very little of their income is available for discretionary spending. It is earmarked to pay the financial, insurance and real estate sectors, not the “real” production and consumption economy. And now repayment time has arrived. People are squeezed. So when America’s saving rate recently rose from zero to 3 percent of national income, it takes the form of people paying down the debts.
Many people thought that the way to get rich faster was to borrow money to buy homes and stocks they expected to rise in price. But this has left the economy financially strapped. People are feeling depressed. The tendency is to blame themselves. I think that the Occupy Wall Street movement, at least here in New York, is like what has occurred in Greece and also in the Arab Spring. People are coming together, and at first they may simply watch what’s going on. Onlookers may come by to see what it’s all about. But then they think, “Wait a minute! Other people are having the same problem I’m having. Maybe it is not really my fault.”
So they begin to see that all these other people who have a similar problem in not being able to pay their debts; they realize that they have been financially crippled by the banks. It is not that they have done something wrong or are sore losers, as Herman Cain says. There’s something radically wrong with the system.
Fifty years ago an old socialist told me that revolutions happen when people just get tired of being afraid. In today’s case the revolution may grow nearer when people get over being depressed and stop blaming themselves. They come to think that we are all in this together – and if this is the case, there must be something wrong with the way the economy is organized.
Gradually, observers of Occupy Wall Street begin to feel stronger. There is positive peer pressure to reinforce their self-confidence. What they intuitively feel is that the Reagan-Clinton-Bush-Obama presidencies have squeezed their lives. The economy has become untracked.
What’s basically wrong is that the financial system is running the government. For years, Republicans and Democrats have both said that a strong government, careful regulation and progressive taxation are markers on the road to serfdom. The politicians and neoliberal economists who write their patter say, “Let’s take planning out of the hands of government and put it in the ‘free market.’” But every market is planned by someone or other. If governments step aside, then planning passes into the hands of the bankers, because of their key role in allocating credit.
The problem is that they have not created credit to finance industrial investment and employment. They have lent for speculation on asset price inflation, using debt leveraging to bid up housing prices, stock and bond prices, and foreign exchange rates. They have convinced borrowers that they can get rich on rising housing prices. But this merely makes new homebuyers go deeper into debt to buy a home. And when banks say that rising stock and bond prices are good for the economy, this price rise lowers the dividend or interest yield. This means that pension funds and individuals have to save much more for retirement. Instead of improving their life, it makes them work harder and borrow more just to stay in place.
The banking system’s alternative to “the road to serfdom” thus turns out to be a road to debt peonage. This financial engineering turns out to be worse than government planning. The banks have taken over the Federal Reserve and Treasury and put their lobbyists in charge – men such as Tim Geithner and the others with ties to Rubinomics dating from the Clinton administration, and especially to Goldman Sachs and other giant Wall Street firms.
* * *
So the first thing to realize is something that is characteristic of all great reform movements. Voters are not yet supporting a radical position to restructure the whole system. But at least they are coming to see that small marginal reforms won’t work, or are simply trick promises, like President Obama’s promise that banks would renegotiate mortgages for homes in negative equity as part of the quid pro quo for the bailouts they received from Treasury Secretary Geithner. There’s been no quid pro quo, merely talk.
People see that law enforcement is missing when it comes to the banks and Wall Street. So simply restoring the criminal justice system would be progress. It used to be that if you ran a fraud, if you cheated people, if you lied on your income tax and falsified statistics, then you would be sent to jail. But the Obama administration has appointed Eric Holder to represent Wall Street. He has not thrown any bankers in jail, recognizing that they are the major campaign contributors of the party, after all.
What is easiest for most people to accept is the idea of restoring the way the economy used to be more in balance – back when people earned income by being productive rather than getting rich by transferring other peoples’ savings and public giveaways into their own pockets. But what I sensed in New York was anger not only at this economic problem, but the fact that the political system is broken. There is no one to vote for as an alternative to pro-bank candidates. So what began as anger has become a gathering awareness that Obama was simply fooling voters instead of leading the change he promised. That’s what politicians do, of course. But people hoped that he might be different. That was the gullibility he played on. He has turned into the nightmare they thought they were voting against.
Moving to the right of the Republicans, he started his administration by appointing the Simpson-Bowles Commission staffed by opponents of Social Security. He recently followed that up by appointing the Congressional Super-committee of Twelve to come out with an even more anti-Social Security, anti-Medicaid and anti-minority position that the Republicans could get away with. If they were to have tried to pass such a right-wing policy, the Democratic Congress would have refused to pass it. But they don’t know how to deal with a Democratic president who appoints Wall Street lobbyists to his cabinet and acts like Margaret Thatcher saying that There Is No Alternative (TINA) to making Social Security recipients, labor and minorities pay for Wall Street’s bad gambles and bank losses. He has helped Wall Street capture the government – on behalf of the 1%.
The man whom Obama asked to be his mentor when he joined the Senate was Joe Lieberman. He evidently gave Obama expert advice about how to raise funds from the financial class by delivering his liberal constituency to his Wall Street campaign contributors. So the problem is not that President Obama is well meaning but inept – an idealist who just can’t fight the vested interests and insiders. He’s thrown in his lot with them. In fact, he really seems to believe the right-wing, pro-Wall Street ideology – that the economy can’t function without a financial system that guarantees “savers” (the top 1%) against loss, even when the bottom 99% have to pay more and more.
And on a personal level, Obama knows that his fund raising comes mainly from Wall Street, and the only way to get this money is to sell out his constituency. You’ve got to give him enough credit to recognize this obvious fact.
The upshot is that we now have a political nightmare. Yet Obama still seems to be the best that the Democrats can offer! This is why I think the protestors are saying they are not going to let the Democrats jump in front of the parade to try and mobilize support for their party. They realize that the financial system is broken and that neither party is trying to do much about it. So the political system has to be changed as well as the economic system.
Suppose you were going to design a society from scratch. Would you create what we have now? Or would you start, for instance, by reforming the most egregious distortions of campaign finance? As matters stand, Goldman Sachs has been able to buy the right to name who is going to be Treasury Secretary. They selected Geithner, who gave them $29 billion from A.I.G. just before he was appointed. It’s like that all down the line – in both parties. Every Democratic congressional committee chairman has to pay to the Party $150,000 to buy the chairmanship. This means that the campaign donors get to determine who gets committee chairmanships. This is oligarchy, not democracy. So the system is geared to favor whoever can grab the most money. Wall Street does it by financial siphoning and asset stripping. Politicians do it by getting money from the beneficiaries – the 1%.
Once people realize that they’re being screwed, that’s a pre-revolutionary situation. It’s a situation where they can get a lot of sympathy and support, precisely by not doing what The New York Times and the other papers say they should do: come up with some neat solutions. They don’t have to propose a solution because right now there isn’t one – without rebuildingthe system with many, many changes. So many that it would be like a new Constitution. Politics as well as the economy need to be restructured. What’s developing now is how to think about the economic and political problems that are bothering people. It is not radical to realize that the economy isn’t working. That is the first stage to realizing that a real alternative is needed. We’ve been under a radical right-wing attack – and need to respond in kind. The next half-year probably will be spent trying to spell out what the best structure would be.
There is no way to clean up the mess that the Democratic Party has become since politics moved into Wall Street’s pockets. The Republicans also have become a party of lobbyists. So it looks as though there is no solution within the existent system. This is a revolutionary, radical situation. The longer that the OWS groups can spend on diagnosing the problem and explaining how far wrong the system has gone, the longer the demonstrators can gain support by showing that they share the feelings everybody has these days – a feeling of being victimized. This is what is creating a raw material that has to potential to flower into political activism, perhaps by spring or summer next year.
The most important message is that all this impoverishment and indebtedness is unnecessary. There is no inherent economic reason for things to be this way. It is not really the way that “markets” need to work. There are many kinds of markets, with many different sets of rules. So the important task is to explain to people how many possibilities there are to make things better. And of course, this is what frightens politicians, Wall Street lobbyists and the other members of the pro-oligarchic army of financial raiders.
So how do we transform the American economy in ways that would produce policies that would at least start to help break the grip that the financial sector has had in devastating the economy in terms of its performance for average households?
There are two stages to any kind of a transformation. The first stage is simply to start re-applying the laws and the taxes that the Bush and Obama administrations have stopped applying. You don’t want Wall Street to be able to put its industry lobbyists in charge of making policy. So the first task is to get rid of Geithner, Holder and the similar pro-financial administrators whom Obama has appointed to his cabinet and in key regulatory positions. This kind of clean-up requires election reform – including a reversal of the Supreme Court’s recent Citizens United ruling that enables a financial oligarchy to lock in its control of American politics.
Prevent monopoly price gouging. Bring bank charges in line with the real cost of doing business.
What is needed today is more than just going back to past ideals. After all, good old class warfare was not so rosy either. But at least the Progressive Era had a program to subordinate finance to serve industry and the rest of the economy. The problem is that its reformers never really had a chance to carry out the ideas that classical economists outlined.
The classical idea of a free market economy was radical in its way – precisely by being natural and thus getting rid of unnatural warping by special privileges for absentee landlords and banks. This led logically to socialism, which is why the history of economic thought has been dropped – indeed, excluded – from today’s academic curriculum. What is needed is to complete the direction of change that World War I interrupted and that the Cold War further untracked. After 1945 you didn’t hear anything any more about what John Maynard Keynes called for at the end of his General Theory in 1936: “euthanasia of the rentier.” But this was the great fight for many centuries of European reform, and it even was the path along which industrial capitalism was expected to evolve. So let me begin with what was discussed back in the 1930s, trying to recover the Progressive Era reforms.
Setting up a more fair banking and financial system requires changing tax favoritism as well, which I will discuss below. There are a number of good proposals for reform. One of the easiest and least radical is set up a public option for banking. Instead of relying on Bank of America or Citibank for credit cards, the government would set up a bank and offer credit cards, check clearing and bank transfers at cost.
The idea throughout the nineteenth century was to create this kind of public option. There was a Post Office bank, and that could still be elaborated to provide banking services at cost or at a subsidized price. After all, in Russia and Japan the post office banks are the largest of all.
The logic for a public banking option is the same as for governments providing free roads: The aim is to minimize the cost of living and doing business. On my website, michael-hudson.com, I have posted an article just published in the American Journal of Economics and Sociology on Simon Patten. He was the first professor of economics at the Wharton Business School. He spelled out the logic of public infrastructure as a “fourth” factor of production (alongside, labor, capital and land). Its productivity is to be measured not by how much profit it makes, but by how much it lowers the economy’s price structure.
Providing a public option would limit the ability of banks to charge monopoly prices for credit cards and loans. It also would not engage in the kind of gambling that has made today’s financial system so unstable and put depositors’ money at risk. Ideally, I would like to see banks act more like the old savings banks and S&Ls. In fact, the most radical regulatory proposal I would like to see is the Chicago Plan promoted in the 1930s by the free marketer Herbert Simon. This is what Dennis Kucinich recently proposed in his National Emergency Employment Defense Act of 2011 (NEED).
This may seem radical at first glance, but how else are you going to stop the banks from their mad computerized gambling, political lobbying and credit creation for corporate raiders to borrow and pay their financial backers by emptying out pension funds and cutting back long-term investment, research and development?
The guiding idea is to take away the banks’ privilege of creating credit electronically on their computer keyboards. You make banks do what textbooks say they are supposed to do: take deposits and lend them out in a productive way. If there are not enough deposits in the economy, the Treasury can create money on its own computer keyboards and supply it to the banks to lend out. But you would rewrite the banking laws so that normal banks are not able to gamble or play the computerized speculative games they are playing today.
The obvious way to do this is to reinstate the Glass-Steagall Act so that they can’t gamble with insured deposits. This way, speculators would bear the burden if they lost, not be in a position to demand “taxpayer liability” by threatening to collapse the normal vanilla banking system. Abolishing Glass-Steagall opened the way for Wall Street to organize a protection racket by mixing up peoples’ deposits with bad gambles and with the growth of debts way beyond the ability to be paid.
To sum up, the idea is to shape markets so as to steer the banks to lend for actual capital formation and to finance home ownership without credit inflation that simply bids up prices for homes as well as for other real estate, stocks, and bonds.
Tax reform needs to back up and reinforce financial reform
Today’s economic problem is systemic. This is what makes any solution so inherently radical. In changing part of the economic system, you have to adjust everything, just as when a doctor operates on a human body. Financial reform requires tax reform, because much of the financial problem stems from the tax shift off real estate and finance onto labor and industry.
The most obvious fiscal task that most people understand – and support – is to restore the progressive tax system that existed before 1980, and especially before the Clinton and Bush tax cuts. It used to be that the rich paid taxes. Now they don’t. But the key isn’t just income-tax rates as such. What needs to be recognized is the kind of taxes that should be levied – or how to shift them back off labor onto property where they were before the 1980s. You need to restore the land taxes to collect the “free lunch” that is not really “free” if it is pledged to pay the banks in the form of mortgage interest.
Over the past few decades the tax system has been warped more and more by bank lobbyists to promote debt financing. Debt is their “product,” after all. As matters now stand, earnings and dividends on equity financing must pay much higher tax rates than cash flow financed with debt. This distortion needs to be reversed. It not only taxes the top 1% at a much lower rate than the bottom 99%, but it also encourages them to make money by lending to the bottom 99%. The result is that the bottom 99% have become increasingly indebted to the top 1%. The enormous bank debt attached to real estate does not reflect rising rents as much as it reflects the tax cuts on property. Wall Street lobbyists have backed Congressional leaders who have shifted taxes onto consumers via sales taxes and income taxes, as well as FICA payroll withholding. This ploy treats Social Security and Medicare as “user fees” rather than paying them out of the overall budget – and financed out of progressive taxation on the top 1%. If wage earners pay more in FICA, you can be sure that the wealthy get a tax cut.
This anti-progressive tax shift is largely responsible for the richest 1% doubling their share of income. It also has led to the 99% having to pay banks what they used to pay the tax collector. They pay interest rather than taxes. If I were economic advisor, I would explain just how this works – which is what I already try to do on my website. In a nutshell, the tax shifts since World War II have left more and more of the land’s site value to be capitalized into interest payments on bank loans. So the banks have ended up with what used to be taken by landowners. There is no inherent need for this. It doesn’t help the economy; it merely inflates a real estate bubble. Economic growth and employment would be much stronger if income tax rates were lowered for most people. Property owners and speculators would pay. There would be less free lunch and more “earned” income.
The Obama Administration has proposed the worse of both worlds – getting rid of the tax deductibility of interest for homeowners. This would squeeze them, without scaling down the bank debts that have absorbed the cuts in property taxes. So Obama is sponsoring yet another anti-consumer proposal to make the bottom 99% pay for government – while using government funds to subsidize the banks and bail out their bad bets.
What needs to be done is to remove the tax deductibility of interest for investors in general. This tax favoritism is a subsidy for debt financing – and the main problem that the U.S. economy faces today is over-indebtedness. A good policy would aim at lowering the debt overhead. Debt leveraging should be discouraged, not encouraged.
Speculators have borrowed largely to make capital gains. They originally were taxed as normal income in the 1913 income tax. The logic was that capital gains build up a person’s savings, just as earning an income does. But the financial and real estate interests fought back, and today there is only a tiny tax on capital gains – a tax that sellers don’t have to pay if they plow their money into another property or investment to make yet more gains! So when Wall Street firms, hedge funds, and other speculators avoid paying normal taxes by saying that they don’t “earn” money but simply make capital gains, this is where a large part of today’s economic inequality lies.
I would tax these asset-price gains (mainly land prices) either at the full income-tax rate or even higher. The wealthy 1% make their gains in this way, claiming that they don’t really “earn” income, so they shouldn’t have to pay taxes as if they are wages or profits. But that’s precisely the problem: Why would you want to subsidize not earning income, but merely making money by speculating – and then demanding that the government bail you out if you make a capital loss when your speculations go bad, on the logic that you have tied up most peoples’ normal bank deposits in these gambles? This is what exists today. And it is why people think the system is so unfair. Most of the super-rich families have made their fortunes by insider dealing and financial extraction, not by being productive. They are not “job creators” these days. They have become job destroyers by demanding austerity to squeeze out more money from a shrinking economy to pay themselves.
Many people – especially homeowners – are sucked into thinking that low capital gains taxes make them rich, and that high property prices leave them with less to spend. But this turns out not to be the case once the process works its way through the economy. These workings need to be more widely explained.
For many years families got rich as the price of their home rose. But they also got much deeper in debt. The real estate bubble was debt-financed. A property is worth whatever a bank will lend against it. The end result of “easy lending” and tax distortions to favor interest-bearing debt is that most families own a smaller and smaller proportion of their homes’ value – and have to pay rising mortgage debt service. This doesn’t really make them better off. The job of a president or economic advisor should be to explain how this game works, so people can get off the debt treadmill. The economy will shrink if it doesn’t lower its debt overhead.
I would close down tax avoidance in offshore banking centers by treating offshore deposits by Americans as “earned but hoarded” income and tax it at 90%. You restore the rates of the Eisenhower administration when the country had the most rapid debt growth that it had. You reinstate criminal penalties for financial fraud and tax evasion by misrepresentation. But the tax avoiders are asking the Obama administration to do just the opposite: to declare a “tax holiday” to “induce” them bring this offshore money home – by not taxing it at all! This kind of giveaway should be blocked. Tax avoiders among the top 1% should be penalized, not rewarded.
The Bush-Obama administration has promoted “neoliberal” tax and financial policies that have reversed a century of Progressive Era reforms. The past 30 years have suffered a radical transformation of tax policy and financial policy. So it takes an equally deep response to undo their distortions and put the American economy back on track. The guiding idea is simply to restore normalcy. The Progressive Era that emerged from classical economics understood the economic benefits of taxing unearned wealth (“rent extraction”) at the top of the economic pyramid, provide basic infrastructure services at cost rather than creating fiefdoms for privatizers to install tollbooths and make their gains tax-exempt. Radical neoliberalism has reversed this. It has vastly multiplied the debts owed by the bottom 99% to the top 1%.
This is leading to debt peonage and what really is neo-feudalism. We are seeing a kind of financial warfare that is as grabbing as the old-style military conquests. The aim is the same: the land, basic infrastructure, and use of the government to extract tribute.
A financial Clean Slate
To restore the kind of normalcy that made America rich, the most important long-term policy would be to recognize what is going to be inevitable for every economy. Debts need to be written down – and the politically easiest way to cut through the tangle is to write them off altogether. That would free the bottom 99% from their debt bondage to the top 1%. It would be a Clean Slate, starting over – and trying to do things right this time around. The creditors have not used the banking system to make America more productive and richer. They have used it as a vehicle to reduce the population to debt serfdom.
A debt write-down sounds radical and unworkable, but it’s been done since World War II with great success. It is the program the Allies carried out in the German economy in that country’s 1947 currency reform. This was the policy that created Germany’s Economic Miracle. And America could experience a similar miracle.
Any economy would benefit from cancelling the bad debts that have been built up. Keeping them on the books will handcuff the economy and cause debt deflation by diverting income to pay debt service rather than to spend on goods and services. We are going into a new economic depression – not just a “Great Recession” – because most spending is now on finance, insurance and real estate, not on goods and basic services. So markets are shrinking, and unemployment is rising. That is what will happen if debts are not written down.
This can be done either by a Clean Slate across the board, or it can be done more selectively, by applying what’s been New York State law since before the Revolution, going back to when New York was still a colony. I’m referring to the law of fraudulent conveyance. This law says that if a creditor lends to a borrower without having any idea how the debtor can pay in the normal course of business, without losing property, the loan is deemed to be fraudulent and declared null and void.
Applying this law to defaulting homeowners would free the homes that are in negative equity throughout the country. It would undo the fraudulent loans that banks have made, the trick loans with exploding interest rates, balloon mortgages and so forth. It also would free debt-strapped companies from being forced to sell off their parts to make their corporate raiders rich.
As an associated law, pension funds should be first in line in any bankruptcy, not at the end of the line as they are now. Current practice lets companies replace defined-benefit programs with defined contribution programs – where all that employees know is how much is taken out of their paychecks each month, not what they will be receiving when they retire. Only the managers have protected their pensions with special contracts and golden parachutes. This is the reverse of what pension plans were supposed to do.
Employee Stock Option Plans (ESOPs) also are being looted. This is what has recently happened at the Chicago Tribune courtesy of Sam Zell, who borrowed money and repaid it by looting the Tribune’s ESOP. A fraudulent conveyance law applied at the nationwide level would stop this. People like Zell are looters, and so are the bankers behind him. This is the class warfare that is being waged today. And the war is being won by the 1% – while pushing the American economy into depression.
As part of the rules to define what constitutes “fraudulent” or irresponsible lending, mortgage debt service should be reduced to the rate that FDIC head Sheila Bair recommended: 32 percent. The problem with debt write-downs, of course, is that when you cancel a debt, you also cancel some party’s savings on the other side of the balance sheet. In this case, the banks would have to give up their claims. But this is what used to happen in financial crashes. When debts go bad, so do the loans. So the government is radical in saying that America’s debts will be kept on the book, but it will create new public debt to give to Wall Street for its own debts that have gone bad as a result of its reckless lending.
The banks obviously would prefer to bankrupt millions of homeowners than to take even a penny’s loss. Their fight to make the government pay for their bad debts – while keeping the debts of the bottom 99% on the books – explains why the richest 1% of Americans have doubled their share of income and the returns to wealth in the last thirty years. That’s inequitable. Their accumulation of financial savings has not taken the form of tangible capital investment in factories or other enterprises to employ labor. It’s looted labor’s savings and got employees so deep into debt that they’re “one paycheck away from homelessness.” They’re afraid to go on strike, because they would miss a mortgage payment or an electric utility payment, and their credit-card interest rates would jump to 29 percent. They’re even afraid to complain about working conditions today, because they’re afraid of getting fired.
This wasn’t formerly the case. It is the result of “financial engineering” that should be reversed. There’s no reason to treat the savings that the top 1% have got in this predatory way as being sacrosanct. Their gain – their increase in financial wealth, in bonds, savings and ownership of bank loans – equals the debts that have been imposed on the bottom 99%. This is the basic equation that needs to be more widely understood. It is not an equilibrium equation. At least, it won’t be political equilibrium when people start to push back.
We are seeing a financial grab for special privilege and for political power to use the government to subsidize the top 1% at the expense of the bottom 99%, by scaling back social spending, Social Security, Medicare, Medicaid and federal revenue sharing with the states. The Treasury and Federal Reserve have printed new debt to give to Wall Street – some $13 trillion and still counting since Lehman Brothers went under in September 2008. Tim Geithner and Hank Paulson used the crisis as an opportunity to give enormous U.S. debt to Wall Street. That’s more radical than reversing this to restore the economy’s financial structure to the way it used to be. If you don’t restore it, you’ve replaced economic democracy with financial oligarchy.
The way to reverse this power grab is to reverse the giveaways by cancelling the bad debts that have been loaded onto the economy. That is the only way to restore balance and prevent the polarization that has occurred. The problem is that savings by the top 1% have been used in a parasitic, extractive manner. It has been lent to the bottom 99 percent to get them deeper and deeper into debt. So they “owe their soul to the company store,” as the song Sixteen Tons put it. “You get a day older, and deeper in debt.”
The government itself has become more indebted, most recently by the $13 trillion in new debt printed and given to the banks to make sure that no financial gambler need surfer a loss. At the same time the Obama administration did this, it claimed that a generation in the future, the Social Security system may be $1 trillion in deficit. And that, Obama says, would cause a crisis – and not leave enough to continue subsidizing his leading campaign contributors. So in view of this new debt creation – while moving debts to consumers and Social Security contributors to the bottom of the list – if you are going to reverse the bad-debt polarization that we’ve reached today, it is necessary to do more than simply reinstate progressive taxation and shift the tax system so that you collect predatory unearned income – what the classical economists call economic rent. The burdensome debts need to be written off.
This probably will take half a year to get most people to realize and accept the idea is to reconstitute the system by lending for productive purposes, not speculation and rent-seeking opportunities. You want to stop the banks from lobbying for monopolies to create a market for leveraged buy-outs of these opportunities – and of course also for real estate speculation and outright gambling.
Wall Street has orchestrated and lobbied for a rentier alliance whose wealth is growing at the expense of the economy at large. It is extractive, not productive. But this fact is concealed by the national income and product accounts reporting financial and other FIRE sector takings as “earnings” rather than as a transfer payment from the economy at large – from the 99% – to the 1% of Americans who have got rich by making money off finance, monopolies and absentee real estate rent-seeking.
It is not really radical to resist Wall Street’s financial attack on America. Resistance is natural – and so is a reversal of the savings they have built up by indebting the rest of the economy to themselves. They took their money and ran with it, stashing it offshore in tax-avoidance islands, in Switzerland, Britain and other havens. Shame on the political hacks who defend this and who attack Occupy Wall Street simply for resisting the financial sector’s own radical power grab and shifted taxes off themselves onto the bottom 99%.
Privatization is an asset grab masquerading as full employment policy
What about government employment projects to guarantee full employment? My first caveat is to warn against letting the Obama administration turn these projects into a military giveaway.
My second caveat is to prevent this full-employment program from creating a later privatization giveaway to Wall Street – that is, infrastructure that the government will sell off to the ruling party’s major campaign contributors for pennies on the dollar. This is what Public/Private Partnerships have become, as pioneered in England under Margaret Thatcher and Tony Blair. Wall Street is rubbing its hands and saying, “That’s a great idea! Let the government pay for infrastructure and spend a billion dollars on a bridge – and then sell it to us for a dollar.” The “us” may not be the banks themselves, but their customers, who will borrow the money and pay the banks an underwriting commission as well as interest on the money they use to buy what the government is privatizing.
The pretense is that privatization is more efficient. But privatizers add on interest and financial fees, high executive salaries and bonuses, and turn the roads into toll roads and other infrastructure into neofeudal fiefdoms to charge monopolistic access fees for people to use. This is what has happened in Chicago when it sold off its sidewalks to let bankers finance parking meters in exchange for a loan. Chicago needed this loan because the financial lobbyists demanded that it cut taxes on commercial real estate and on the rich. So the financial sector first creates a problem by loading the economy down with debt, and then “solves” it by demanding privatization sell-offs under distress conditions.
This is happening not only in America, but in Greece and other countries under the insistence of Europe’s bank lobbying organization, the European Central Bank. That’s why there are riots in Athens. The financial war against society is not only being waged here, but throughout the world.
In promoting full employment, the aim should be to invest public money in a way that the Republicans and Democrats cannot later turn around and privatize the capital investment at a giveaway price. So I am all on favor of public infrastructure spending as long as you have safeguards against the financial fraud and giveaways to insiders of the sort that that the current administration is sponsoring. The privatizers and their banks would like to install tollbooths on new bridges and get a free ride to turn America into a tollbooth economy.
First Steps in Reforming the U.S. Financial and Tax System
by MICHAEL HUDSON
The Occupy Wall Street movement has many similarities with what used to be called the Great Awakening periods in America. Such periods always begin by realizing how serious the problem is. So diagnosis is the most important tactic. Diagnosing the problem mobilizes power for a solution. Otherwise, solutions will seem to come out of thin air and people won’t understand why they are needed, or even the problems that solutions are intended to cure. The basic problem today is that nearly everyone is in debt. This is the problem in Europe too. There are Occupy Berlin meetings, the Greek and Icelandic protests, Spain’s “Indignant” demonstrations and similar ones throughout the world.
When debts reach today’s proportions, a basic economic principle is at work: Debts that can’t be paid; won’t be. The question is, just how are they not going to be paid? People with student loans are not permitted to declare bankruptcy to get a fresh start. The government or collection agencies dock their salaries and go after whatever property they have. Many people’s revenue over and above basic needs is earmarked to pay the bankers. Typical American wage earners pay about 40 percent of their wages on housing whose price is bid up by easy mortgage credit, and another 10 to 15 percent for credit cards and other debt service. FICA takes over 13 per cent, and federal, local and sales taxes another 15 percent or so. All this leaves only about a quarter of many peoples’ paychecks available for spending on goods and services. This is what is causing today’s debt deflation. And Wall Street is supporting it, because it extracts income from the bottom 99% to pay the top 1%.
Half a century ago most economists imagined that the problem would be people saving too much as they got richer. Saving meant non-spending. But the problem has turned out to be just the opposite: debt. Overall, salaries have not risen in decades, so many people have borrowed just to break even. Instead of an era of free choice, very little of their income is available for discretionary spending. It is earmarked to pay the financial, insurance and real estate sectors, not the “real” production and consumption economy. And now repayment time has arrived. People are squeezed. So when America’s saving rate recently rose from zero to 3 percent of national income, it takes the form of people paying down the debts.
Many people thought that the way to get rich faster was to borrow money to buy homes and stocks they expected to rise in price. But this has left the economy financially strapped. People are feeling depressed. The tendency is to blame themselves. I think that the Occupy Wall Street movement, at least here in New York, is like what has occurred in Greece and also in the Arab Spring. People are coming together, and at first they may simply watch what’s going on. Onlookers may come by to see what it’s all about. But then they think, “Wait a minute! Other people are having the same problem I’m having. Maybe it is not really my fault.”
So they begin to see that all these other people who have a similar problem in not being able to pay their debts; they realize that they have been financially crippled by the banks. It is not that they have done something wrong or are sore losers, as Herman Cain says. There’s something radically wrong with the system.
Fifty years ago an old socialist told me that revolutions happen when people just get tired of being afraid. In today’s case the revolution may grow nearer when people get over being depressed and stop blaming themselves. They come to think that we are all in this together – and if this is the case, there must be something wrong with the way the economy is organized.
Gradually, observers of Occupy Wall Street begin to feel stronger. There is positive peer pressure to reinforce their self-confidence. What they intuitively feel is that the Reagan-Clinton-Bush-Obama presidencies have squeezed their lives. The economy has become untracked.
What’s basically wrong is that the financial system is running the government. For years, Republicans and Democrats have both said that a strong government, careful regulation and progressive taxation are markers on the road to serfdom. The politicians and neoliberal economists who write their patter say, “Let’s take planning out of the hands of government and put it in the ‘free market.’” But every market is planned by someone or other. If governments step aside, then planning passes into the hands of the bankers, because of their key role in allocating credit.
The problem is that they have not created credit to finance industrial investment and employment. They have lent for speculation on asset price inflation, using debt leveraging to bid up housing prices, stock and bond prices, and foreign exchange rates. They have convinced borrowers that they can get rich on rising housing prices. But this merely makes new homebuyers go deeper into debt to buy a home. And when banks say that rising stock and bond prices are good for the economy, this price rise lowers the dividend or interest yield. This means that pension funds and individuals have to save much more for retirement. Instead of improving their life, it makes them work harder and borrow more just to stay in place.
The banking system’s alternative to “the road to serfdom” thus turns out to be a road to debt peonage. This financial engineering turns out to be worse than government planning. The banks have taken over the Federal Reserve and Treasury and put their lobbyists in charge – men such as Tim Geithner and the others with ties to Rubinomics dating from the Clinton administration, and especially to Goldman Sachs and other giant Wall Street firms.
* * *
So the first thing to realize is something that is characteristic of all great reform movements. Voters are not yet supporting a radical position to restructure the whole system. But at least they are coming to see that small marginal reforms won’t work, or are simply trick promises, like President Obama’s promise that banks would renegotiate mortgages for homes in negative equity as part of the quid pro quo for the bailouts they received from Treasury Secretary Geithner. There’s been no quid pro quo, merely talk.
People see that law enforcement is missing when it comes to the banks and Wall Street. So simply restoring the criminal justice system would be progress. It used to be that if you ran a fraud, if you cheated people, if you lied on your income tax and falsified statistics, then you would be sent to jail. But the Obama administration has appointed Eric Holder to represent Wall Street. He has not thrown any bankers in jail, recognizing that they are the major campaign contributors of the party, after all.
What is easiest for most people to accept is the idea of restoring the way the economy used to be more in balance – back when people earned income by being productive rather than getting rich by transferring other peoples’ savings and public giveaways into their own pockets. But what I sensed in New York was anger not only at this economic problem, but the fact that the political system is broken. There is no one to vote for as an alternative to pro-bank candidates. So what began as anger has become a gathering awareness that Obama was simply fooling voters instead of leading the change he promised. That’s what politicians do, of course. But people hoped that he might be different. That was the gullibility he played on. He has turned into the nightmare they thought they were voting against.
Moving to the right of the Republicans, he started his administration by appointing the Simpson-Bowles Commission staffed by opponents of Social Security. He recently followed that up by appointing the Congressional Super-committee of Twelve to come out with an even more anti-Social Security, anti-Medicaid and anti-minority position that the Republicans could get away with. If they were to have tried to pass such a right-wing policy, the Democratic Congress would have refused to pass it. But they don’t know how to deal with a Democratic president who appoints Wall Street lobbyists to his cabinet and acts like Margaret Thatcher saying that There Is No Alternative (TINA) to making Social Security recipients, labor and minorities pay for Wall Street’s bad gambles and bank losses. He has helped Wall Street capture the government – on behalf of the 1%.
The man whom Obama asked to be his mentor when he joined the Senate was Joe Lieberman. He evidently gave Obama expert advice about how to raise funds from the financial class by delivering his liberal constituency to his Wall Street campaign contributors. So the problem is not that President Obama is well meaning but inept – an idealist who just can’t fight the vested interests and insiders. He’s thrown in his lot with them. In fact, he really seems to believe the right-wing, pro-Wall Street ideology – that the economy can’t function without a financial system that guarantees “savers” (the top 1%) against loss, even when the bottom 99% have to pay more and more.
And on a personal level, Obama knows that his fund raising comes mainly from Wall Street, and the only way to get this money is to sell out his constituency. You’ve got to give him enough credit to recognize this obvious fact.
The upshot is that we now have a political nightmare. Yet Obama still seems to be the best that the Democrats can offer! This is why I think the protestors are saying they are not going to let the Democrats jump in front of the parade to try and mobilize support for their party. They realize that the financial system is broken and that neither party is trying to do much about it. So the political system has to be changed as well as the economic system.
Suppose you were going to design a society from scratch. Would you create what we have now? Or would you start, for instance, by reforming the most egregious distortions of campaign finance? As matters stand, Goldman Sachs has been able to buy the right to name who is going to be Treasury Secretary. They selected Geithner, who gave them $29 billion from A.I.G. just before he was appointed. It’s like that all down the line – in both parties. Every Democratic congressional committee chairman has to pay to the Party $150,000 to buy the chairmanship. This means that the campaign donors get to determine who gets committee chairmanships. This is oligarchy, not democracy. So the system is geared to favor whoever can grab the most money. Wall Street does it by financial siphoning and asset stripping. Politicians do it by getting money from the beneficiaries – the 1%.
Once people realize that they’re being screwed, that’s a pre-revolutionary situation. It’s a situation where they can get a lot of sympathy and support, precisely by not doing what The New York Times and the other papers say they should do: come up with some neat solutions. They don’t have to propose a solution because right now there isn’t one – without rebuildingthe system with many, many changes. So many that it would be like a new Constitution. Politics as well as the economy need to be restructured. What’s developing now is how to think about the economic and political problems that are bothering people. It is not radical to realize that the economy isn’t working. That is the first stage to realizing that a real alternative is needed. We’ve been under a radical right-wing attack – and need to respond in kind. The next half-year probably will be spent trying to spell out what the best structure would be.
There is no way to clean up the mess that the Democratic Party has become since politics moved into Wall Street’s pockets. The Republicans also have become a party of lobbyists. So it looks as though there is no solution within the existent system. This is a revolutionary, radical situation. The longer that the OWS groups can spend on diagnosing the problem and explaining how far wrong the system has gone, the longer the demonstrators can gain support by showing that they share the feelings everybody has these days – a feeling of being victimized. This is what is creating a raw material that has to potential to flower into political activism, perhaps by spring or summer next year.
The most important message is that all this impoverishment and indebtedness is unnecessary. There is no inherent economic reason for things to be this way. It is not really the way that “markets” need to work. There are many kinds of markets, with many different sets of rules. So the important task is to explain to people how many possibilities there are to make things better. And of course, this is what frightens politicians, Wall Street lobbyists and the other members of the pro-oligarchic army of financial raiders.
So how do we transform the American economy in ways that would produce policies that would at least start to help break the grip that the financial sector has had in devastating the economy in terms of its performance for average households?
There are two stages to any kind of a transformation. The first stage is simply to start re-applying the laws and the taxes that the Bush and Obama administrations have stopped applying. You don’t want Wall Street to be able to put its industry lobbyists in charge of making policy. So the first task is to get rid of Geithner, Holder and the similar pro-financial administrators whom Obama has appointed to his cabinet and in key regulatory positions. This kind of clean-up requires election reform – including a reversal of the Supreme Court’s recent Citizens United ruling that enables a financial oligarchy to lock in its control of American politics.
Prevent monopoly price gouging. Bring bank charges in line with the real cost of doing business.
What is needed today is more than just going back to past ideals. After all, good old class warfare was not so rosy either. But at least the Progressive Era had a program to subordinate finance to serve industry and the rest of the economy. The problem is that its reformers never really had a chance to carry out the ideas that classical economists outlined.
The classical idea of a free market economy was radical in its way – precisely by being natural and thus getting rid of unnatural warping by special privileges for absentee landlords and banks. This led logically to socialism, which is why the history of economic thought has been dropped – indeed, excluded – from today’s academic curriculum. What is needed is to complete the direction of change that World War I interrupted and that the Cold War further untracked. After 1945 you didn’t hear anything any more about what John Maynard Keynes called for at the end of his General Theory in 1936: “euthanasia of the rentier.” But this was the great fight for many centuries of European reform, and it even was the path along which industrial capitalism was expected to evolve. So let me begin with what was discussed back in the 1930s, trying to recover the Progressive Era reforms.
Setting up a more fair banking and financial system requires changing tax favoritism as well, which I will discuss below. There are a number of good proposals for reform. One of the easiest and least radical is set up a public option for banking. Instead of relying on Bank of America or Citibank for credit cards, the government would set up a bank and offer credit cards, check clearing and bank transfers at cost.
The idea throughout the nineteenth century was to create this kind of public option. There was a Post Office bank, and that could still be elaborated to provide banking services at cost or at a subsidized price. After all, in Russia and Japan the post office banks are the largest of all.
The logic for a public banking option is the same as for governments providing free roads: The aim is to minimize the cost of living and doing business. On my website, michael-hudson.com, I have posted an article just published in the American Journal of Economics and Sociology on Simon Patten. He was the first professor of economics at the Wharton Business School. He spelled out the logic of public infrastructure as a “fourth” factor of production (alongside, labor, capital and land). Its productivity is to be measured not by how much profit it makes, but by how much it lowers the economy’s price structure.
Providing a public option would limit the ability of banks to charge monopoly prices for credit cards and loans. It also would not engage in the kind of gambling that has made today’s financial system so unstable and put depositors’ money at risk. Ideally, I would like to see banks act more like the old savings banks and S&Ls. In fact, the most radical regulatory proposal I would like to see is the Chicago Plan promoted in the 1930s by the free marketer Herbert Simon. This is what Dennis Kucinich recently proposed in his National Emergency Employment Defense Act of 2011 (NEED).
This may seem radical at first glance, but how else are you going to stop the banks from their mad computerized gambling, political lobbying and credit creation for corporate raiders to borrow and pay their financial backers by emptying out pension funds and cutting back long-term investment, research and development?
The guiding idea is to take away the banks’ privilege of creating credit electronically on their computer keyboards. You make banks do what textbooks say they are supposed to do: take deposits and lend them out in a productive way. If there are not enough deposits in the economy, the Treasury can create money on its own computer keyboards and supply it to the banks to lend out. But you would rewrite the banking laws so that normal banks are not able to gamble or play the computerized speculative games they are playing today.
The obvious way to do this is to reinstate the Glass-Steagall Act so that they can’t gamble with insured deposits. This way, speculators would bear the burden if they lost, not be in a position to demand “taxpayer liability” by threatening to collapse the normal vanilla banking system. Abolishing Glass-Steagall opened the way for Wall Street to organize a protection racket by mixing up peoples’ deposits with bad gambles and with the growth of debts way beyond the ability to be paid.
To sum up, the idea is to shape markets so as to steer the banks to lend for actual capital formation and to finance home ownership without credit inflation that simply bids up prices for homes as well as for other real estate, stocks, and bonds.
Tax reform needs to back up and reinforce financial reform
Today’s economic problem is systemic. This is what makes any solution so inherently radical. In changing part of the economic system, you have to adjust everything, just as when a doctor operates on a human body. Financial reform requires tax reform, because much of the financial problem stems from the tax shift off real estate and finance onto labor and industry.
The most obvious fiscal task that most people understand – and support – is to restore the progressive tax system that existed before 1980, and especially before the Clinton and Bush tax cuts. It used to be that the rich paid taxes. Now they don’t. But the key isn’t just income-tax rates as such. What needs to be recognized is the kind of taxes that should be levied – or how to shift them back off labor onto property where they were before the 1980s. You need to restore the land taxes to collect the “free lunch” that is not really “free” if it is pledged to pay the banks in the form of mortgage interest.
Over the past few decades the tax system has been warped more and more by bank lobbyists to promote debt financing. Debt is their “product,” after all. As matters now stand, earnings and dividends on equity financing must pay much higher tax rates than cash flow financed with debt. This distortion needs to be reversed. It not only taxes the top 1% at a much lower rate than the bottom 99%, but it also encourages them to make money by lending to the bottom 99%. The result is that the bottom 99% have become increasingly indebted to the top 1%. The enormous bank debt attached to real estate does not reflect rising rents as much as it reflects the tax cuts on property. Wall Street lobbyists have backed Congressional leaders who have shifted taxes onto consumers via sales taxes and income taxes, as well as FICA payroll withholding. This ploy treats Social Security and Medicare as “user fees” rather than paying them out of the overall budget – and financed out of progressive taxation on the top 1%. If wage earners pay more in FICA, you can be sure that the wealthy get a tax cut.
This anti-progressive tax shift is largely responsible for the richest 1% doubling their share of income. It also has led to the 99% having to pay banks what they used to pay the tax collector. They pay interest rather than taxes. If I were economic advisor, I would explain just how this works – which is what I already try to do on my website. In a nutshell, the tax shifts since World War II have left more and more of the land’s site value to be capitalized into interest payments on bank loans. So the banks have ended up with what used to be taken by landowners. There is no inherent need for this. It doesn’t help the economy; it merely inflates a real estate bubble. Economic growth and employment would be much stronger if income tax rates were lowered for most people. Property owners and speculators would pay. There would be less free lunch and more “earned” income.
The Obama Administration has proposed the worse of both worlds – getting rid of the tax deductibility of interest for homeowners. This would squeeze them, without scaling down the bank debts that have absorbed the cuts in property taxes. So Obama is sponsoring yet another anti-consumer proposal to make the bottom 99% pay for government – while using government funds to subsidize the banks and bail out their bad bets.
What needs to be done is to remove the tax deductibility of interest for investors in general. This tax favoritism is a subsidy for debt financing – and the main problem that the U.S. economy faces today is over-indebtedness. A good policy would aim at lowering the debt overhead. Debt leveraging should be discouraged, not encouraged.
Speculators have borrowed largely to make capital gains. They originally were taxed as normal income in the 1913 income tax. The logic was that capital gains build up a person’s savings, just as earning an income does. But the financial and real estate interests fought back, and today there is only a tiny tax on capital gains – a tax that sellers don’t have to pay if they plow their money into another property or investment to make yet more gains! So when Wall Street firms, hedge funds, and other speculators avoid paying normal taxes by saying that they don’t “earn” money but simply make capital gains, this is where a large part of today’s economic inequality lies.
I would tax these asset-price gains (mainly land prices) either at the full income-tax rate or even higher. The wealthy 1% make their gains in this way, claiming that they don’t really “earn” income, so they shouldn’t have to pay taxes as if they are wages or profits. But that’s precisely the problem: Why would you want to subsidize not earning income, but merely making money by speculating – and then demanding that the government bail you out if you make a capital loss when your speculations go bad, on the logic that you have tied up most peoples’ normal bank deposits in these gambles? This is what exists today. And it is why people think the system is so unfair. Most of the super-rich families have made their fortunes by insider dealing and financial extraction, not by being productive. They are not “job creators” these days. They have become job destroyers by demanding austerity to squeeze out more money from a shrinking economy to pay themselves.
Many people – especially homeowners – are sucked into thinking that low capital gains taxes make them rich, and that high property prices leave them with less to spend. But this turns out not to be the case once the process works its way through the economy. These workings need to be more widely explained.
For many years families got rich as the price of their home rose. But they also got much deeper in debt. The real estate bubble was debt-financed. A property is worth whatever a bank will lend against it. The end result of “easy lending” and tax distortions to favor interest-bearing debt is that most families own a smaller and smaller proportion of their homes’ value – and have to pay rising mortgage debt service. This doesn’t really make them better off. The job of a president or economic advisor should be to explain how this game works, so people can get off the debt treadmill. The economy will shrink if it doesn’t lower its debt overhead.
I would close down tax avoidance in offshore banking centers by treating offshore deposits by Americans as “earned but hoarded” income and tax it at 90%. You restore the rates of the Eisenhower administration when the country had the most rapid debt growth that it had. You reinstate criminal penalties for financial fraud and tax evasion by misrepresentation. But the tax avoiders are asking the Obama administration to do just the opposite: to declare a “tax holiday” to “induce” them bring this offshore money home – by not taxing it at all! This kind of giveaway should be blocked. Tax avoiders among the top 1% should be penalized, not rewarded.
The Bush-Obama administration has promoted “neoliberal” tax and financial policies that have reversed a century of Progressive Era reforms. The past 30 years have suffered a radical transformation of tax policy and financial policy. So it takes an equally deep response to undo their distortions and put the American economy back on track. The guiding idea is simply to restore normalcy. The Progressive Era that emerged from classical economics understood the economic benefits of taxing unearned wealth (“rent extraction”) at the top of the economic pyramid, provide basic infrastructure services at cost rather than creating fiefdoms for privatizers to install tollbooths and make their gains tax-exempt. Radical neoliberalism has reversed this. It has vastly multiplied the debts owed by the bottom 99% to the top 1%.
This is leading to debt peonage and what really is neo-feudalism. We are seeing a kind of financial warfare that is as grabbing as the old-style military conquests. The aim is the same: the land, basic infrastructure, and use of the government to extract tribute.
A financial Clean Slate
To restore the kind of normalcy that made America rich, the most important long-term policy would be to recognize what is going to be inevitable for every economy. Debts need to be written down – and the politically easiest way to cut through the tangle is to write them off altogether. That would free the bottom 99% from their debt bondage to the top 1%. It would be a Clean Slate, starting over – and trying to do things right this time around. The creditors have not used the banking system to make America more productive and richer. They have used it as a vehicle to reduce the population to debt serfdom.
A debt write-down sounds radical and unworkable, but it’s been done since World War II with great success. It is the program the Allies carried out in the German economy in that country’s 1947 currency reform. This was the policy that created Germany’s Economic Miracle. And America could experience a similar miracle.
Any economy would benefit from cancelling the bad debts that have been built up. Keeping them on the books will handcuff the economy and cause debt deflation by diverting income to pay debt service rather than to spend on goods and services. We are going into a new economic depression – not just a “Great Recession” – because most spending is now on finance, insurance and real estate, not on goods and basic services. So markets are shrinking, and unemployment is rising. That is what will happen if debts are not written down.
This can be done either by a Clean Slate across the board, or it can be done more selectively, by applying what’s been New York State law since before the Revolution, going back to when New York was still a colony. I’m referring to the law of fraudulent conveyance. This law says that if a creditor lends to a borrower without having any idea how the debtor can pay in the normal course of business, without losing property, the loan is deemed to be fraudulent and declared null and void.
Applying this law to defaulting homeowners would free the homes that are in negative equity throughout the country. It would undo the fraudulent loans that banks have made, the trick loans with exploding interest rates, balloon mortgages and so forth. It also would free debt-strapped companies from being forced to sell off their parts to make their corporate raiders rich.
As an associated law, pension funds should be first in line in any bankruptcy, not at the end of the line as they are now. Current practice lets companies replace defined-benefit programs with defined contribution programs – where all that employees know is how much is taken out of their paychecks each month, not what they will be receiving when they retire. Only the managers have protected their pensions with special contracts and golden parachutes. This is the reverse of what pension plans were supposed to do.
Employee Stock Option Plans (ESOPs) also are being looted. This is what has recently happened at the Chicago Tribune courtesy of Sam Zell, who borrowed money and repaid it by looting the Tribune’s ESOP. A fraudulent conveyance law applied at the nationwide level would stop this. People like Zell are looters, and so are the bankers behind him. This is the class warfare that is being waged today. And the war is being won by the 1% – while pushing the American economy into depression.
As part of the rules to define what constitutes “fraudulent” or irresponsible lending, mortgage debt service should be reduced to the rate that FDIC head Sheila Bair recommended: 32 percent. The problem with debt write-downs, of course, is that when you cancel a debt, you also cancel some party’s savings on the other side of the balance sheet. In this case, the banks would have to give up their claims. But this is what used to happen in financial crashes. When debts go bad, so do the loans. So the government is radical in saying that America’s debts will be kept on the book, but it will create new public debt to give to Wall Street for its own debts that have gone bad as a result of its reckless lending.
The banks obviously would prefer to bankrupt millions of homeowners than to take even a penny’s loss. Their fight to make the government pay for their bad debts – while keeping the debts of the bottom 99% on the books – explains why the richest 1% of Americans have doubled their share of income and the returns to wealth in the last thirty years. That’s inequitable. Their accumulation of financial savings has not taken the form of tangible capital investment in factories or other enterprises to employ labor. It’s looted labor’s savings and got employees so deep into debt that they’re “one paycheck away from homelessness.” They’re afraid to go on strike, because they would miss a mortgage payment or an electric utility payment, and their credit-card interest rates would jump to 29 percent. They’re even afraid to complain about working conditions today, because they’re afraid of getting fired.
This wasn’t formerly the case. It is the result of “financial engineering” that should be reversed. There’s no reason to treat the savings that the top 1% have got in this predatory way as being sacrosanct. Their gain – their increase in financial wealth, in bonds, savings and ownership of bank loans – equals the debts that have been imposed on the bottom 99%. This is the basic equation that needs to be more widely understood. It is not an equilibrium equation. At least, it won’t be political equilibrium when people start to push back.
We are seeing a financial grab for special privilege and for political power to use the government to subsidize the top 1% at the expense of the bottom 99%, by scaling back social spending, Social Security, Medicare, Medicaid and federal revenue sharing with the states. The Treasury and Federal Reserve have printed new debt to give to Wall Street – some $13 trillion and still counting since Lehman Brothers went under in September 2008. Tim Geithner and Hank Paulson used the crisis as an opportunity to give enormous U.S. debt to Wall Street. That’s more radical than reversing this to restore the economy’s financial structure to the way it used to be. If you don’t restore it, you’ve replaced economic democracy with financial oligarchy.
The way to reverse this power grab is to reverse the giveaways by cancelling the bad debts that have been loaded onto the economy. That is the only way to restore balance and prevent the polarization that has occurred. The problem is that savings by the top 1% have been used in a parasitic, extractive manner. It has been lent to the bottom 99 percent to get them deeper and deeper into debt. So they “owe their soul to the company store,” as the song Sixteen Tons put it. “You get a day older, and deeper in debt.”
The government itself has become more indebted, most recently by the $13 trillion in new debt printed and given to the banks to make sure that no financial gambler need surfer a loss. At the same time the Obama administration did this, it claimed that a generation in the future, the Social Security system may be $1 trillion in deficit. And that, Obama says, would cause a crisis – and not leave enough to continue subsidizing his leading campaign contributors. So in view of this new debt creation – while moving debts to consumers and Social Security contributors to the bottom of the list – if you are going to reverse the bad-debt polarization that we’ve reached today, it is necessary to do more than simply reinstate progressive taxation and shift the tax system so that you collect predatory unearned income – what the classical economists call economic rent. The burdensome debts need to be written off.
This probably will take half a year to get most people to realize and accept the idea is to reconstitute the system by lending for productive purposes, not speculation and rent-seeking opportunities. You want to stop the banks from lobbying for monopolies to create a market for leveraged buy-outs of these opportunities – and of course also for real estate speculation and outright gambling.
Wall Street has orchestrated and lobbied for a rentier alliance whose wealth is growing at the expense of the economy at large. It is extractive, not productive. But this fact is concealed by the national income and product accounts reporting financial and other FIRE sector takings as “earnings” rather than as a transfer payment from the economy at large – from the 99% – to the 1% of Americans who have got rich by making money off finance, monopolies and absentee real estate rent-seeking.
It is not really radical to resist Wall Street’s financial attack on America. Resistance is natural – and so is a reversal of the savings they have built up by indebting the rest of the economy to themselves. They took their money and ran with it, stashing it offshore in tax-avoidance islands, in Switzerland, Britain and other havens. Shame on the political hacks who defend this and who attack Occupy Wall Street simply for resisting the financial sector’s own radical power grab and shifted taxes off themselves onto the bottom 99%.
Privatization is an asset grab masquerading as full employment policy
What about government employment projects to guarantee full employment? My first caveat is to warn against letting the Obama administration turn these projects into a military giveaway.
My second caveat is to prevent this full-employment program from creating a later privatization giveaway to Wall Street – that is, infrastructure that the government will sell off to the ruling party’s major campaign contributors for pennies on the dollar. This is what Public/Private Partnerships have become, as pioneered in England under Margaret Thatcher and Tony Blair. Wall Street is rubbing its hands and saying, “That’s a great idea! Let the government pay for infrastructure and spend a billion dollars on a bridge – and then sell it to us for a dollar.” The “us” may not be the banks themselves, but their customers, who will borrow the money and pay the banks an underwriting commission as well as interest on the money they use to buy what the government is privatizing.
The pretense is that privatization is more efficient. But privatizers add on interest and financial fees, high executive salaries and bonuses, and turn the roads into toll roads and other infrastructure into neofeudal fiefdoms to charge monopolistic access fees for people to use. This is what has happened in Chicago when it sold off its sidewalks to let bankers finance parking meters in exchange for a loan. Chicago needed this loan because the financial lobbyists demanded that it cut taxes on commercial real estate and on the rich. So the financial sector first creates a problem by loading the economy down with debt, and then “solves” it by demanding privatization sell-offs under distress conditions.
This is happening not only in America, but in Greece and other countries under the insistence of Europe’s bank lobbying organization, the European Central Bank. That’s why there are riots in Athens. The financial war against society is not only being waged here, but throughout the world.
In promoting full employment, the aim should be to invest public money in a way that the Republicans and Democrats cannot later turn around and privatize the capital investment at a giveaway price. So I am all on favor of public infrastructure spending as long as you have safeguards against the financial fraud and giveaways to insiders of the sort that that the current administration is sponsoring. The privatizers and their banks would like to install tollbooths on new bridges and get a free ride to turn America into a tollbooth economy.
This article had its origins in a radio interview with Alan Minsky on KPFK.
MICHAEL HUDSON is a former Wall Street economist. A Distinguished Research Professor at University of Missouri, Kansas City (UMKC), he is the author of many books, including Super Imperialism: The Economic Strategy of American Empire (new ed., Pluto Press, 2002) and Trade, Development and Foreign Debt: A History of Theories of Polarization v. Convergence in the World Economy. Hopeless: Barack Obama and the Politics of Illusion, forthcoming from AK Press. He can be reached via his website, mh@michael-hudson.com
Saint Paul's United Church of Christ 401 East Main Street Barrington, Illinois 60010
Hi Bill,
So wonderful and timely to see you in church today. Thanks for the lift back home, and for listening to my remarkable epiphany.
This is what the Lord has put onto my heart: back to your original idea to stage "events" for membership outreach physically on the grounds of St Paul's, this IS the way to go, if the church council can be sold on the idea of a regularly scheduled, periodic meeting on Sunday afternoons, and the right thing to do is to target other praise band teams in the area, inviting them to put on about 25-30 minute performances, with enough participants to provide about a 3-hour venue (probably open mic is the right way to present it - with the stipulation that each week would be featured performers from various of the local churches) for fellowship, worship, praise, food, coffee, cola, singing, song, and dancing. SOMEBODY has to host the event; it may as well be St Paul's, unless or until someone else steps up to take up the cause (ultimately, a rotating format might be the way to go, if there is enough interest from local churches).
Teen-aged suicide awareness falls quite naturally into this purview (we need to discuss with Paul Tack, who worked many years with my mother at the Jewel Tea Corporation what it is that St. Anne is doing in this regards. To my knowledge, this is the only local church that actively addresses this issue, counseling its children on how to recognize the signs of at-risk-for-suicide youths. To my knowledge this is the only local organization that dares to even whisper the words "teen suicides" in the same breath; the 800-pound gorilla in the living room).
I was so impressed with Jana's acknowledgement of Dark-side Jana today. I had not given her credit for so much self-awareness, although I do believe that if I were to tell her of the five specific instances in which she exposed her evil-spirited bitchy side, and NOT merely to me, she might faint away dead that she had been caught so off guard. But, perhaps, like the recalcitrant child, she recognized that I could be the one to be counted upon for calling her on her bull feathers. I daresay y'all have some boundary issues that make you reluctant to do so, as was discussed at the round table this afternoon.
I'd like you to present the following to Jana and the rest of the leadership crew (star-ship St Paul's UCC, boldly going where no churches have gone before). You'll never get a more sincere, nor more heartfelt, nor better written recommendation than this one (he said, as a statement of fact, which no pride whatsoever; it simply is what it is).
==========================================================================
Saint Paul's United Church of Christ
401 East Main Street
Barrington, Illinois 60010
As kind, generous, non-judgmental, loving, and caring a congregation as you'll ever find, is St. Paul's United Chruch of Christ in Barrington, Illinois. Many of Barrington's foremost and prominent community-serving families have their membership roots grounded here, where Pastor Jana Chwalisz is as a fine a composer and deliverer of sermons as has ever walked the planet. Rene Krupper the very gifted and pragmatic director of music, directs as individually talented a group of musicians as ever you will find, and she uses the various ensembles (Praise Team, Senior Choir, Handbell Choir) in a set rotation so that each ensemble has the opportunity to hear the other two ensembles at least two weeks out of every month.
Although a relatively small congregation (89 families signed pledge offerings for calendar year 2011), their leadership has dared to dream big dreams and will almost undoubtedly grow rapidly over the next five years.
Some of the really nice and things about the Sunday services include:
Large print for the Bulletin;
Their Hymnal is very traditional - they don't update it every 10 years or so, as to the Lutherans, sometimes, or so it seems, for the mere sake of updating the hymnal;
They actively embrace, welcome and nourish gay couples;
They actively embrace, welcome, and nourish peoples of color;
They proudly proclaim the names of the relatives of those who attend that serve in the military;
They proudly fly the American flag;
Each week, as part of the regular devotional service, Pastor Jana asks those assembled to tell of prayers which have been answered, or prayers which are needed for friends / family / loved ones, or even groups of poor and marginalized peoples from all over the globe, and upon collecting all the information, then prays for them leading the congregation in prayer, and then ensures that these people / groups are placed in the following week's church bulletin to ensure at least one more week of on-going prayers for them.
The church had 150 children in their summer vacation Bible school (the word is out - St Paul's does GOOD by your kids);
The elected church council has been dealing with issues few churches see in 100 years these past 12 months and has developed and implemented innovative action plans to deal with the realities of an ongoing (since 1854) but relatively stagnant membership population as thoughtfully, insightfully, and imaginatively creative, willing to learn, willing to grow, willing to change, honest and open as any you will EVER encounter. They also recognize these times of trials and tribulations as an incredible opportunity to sit back and take a very close look at just what it means to be a church; just what the church expects from its pastor; just what the pastor has to offer the church; just what the church needs to do to prosper, GROW, and thrive.
This past year they had to deal with some of the most difficult decisions an established church will ever have to come to grips with and dealt with fundamental questions about just what it was that the church wanted, needed, and expected from its pastoral staff, and what was realistic to ask of said staff. Their response was one that ENRON might well have paid $1,00,000 to a management consulting firm to produce.
If you enter a church service a stranger, you will leave with at least three new and very close, caring friends.
The membership is quite familiar with and sympathetic to the human condition, and they are NOT afraid to tell you when you have done something stupid THAT you have done something stupid, but invariably append, "We love you anyway; we simply had to tell you for your own good because CLEARLY nobody else cares enough about you to tell you these simple (and very obvious) truths."
The UCC is very active in its support to countries around the world. St Paul has sent ministers and congregants to the southern reaches of Mexico where Commandante Marcos and the indigenous Indian peoples are engaged in a struggle to reclaim lands from the wealthies of land-owners for the poor peoples of Southern Mexico.
The church is strongly engaged in local ministries and outreaches to the less fortunate citizens of the area. The church has a sister-church and the two churches engage in joint projects to proclaim and affirm the love of God in their lives.
BEST PART of Sunday worship is the fellowship snacks and coffee afterwards, where virtually every one who attended the service can be found in the fellowship hall sitting or standing, coffee cup in hand, chatting with old friends, or the newest faced visitor (even ones with very bad hair cuts; even ones with hair dyed BLUE!).
I was first drawn to enter the church doors and engage due to the Wednesday afternoon Bible Study (proudly proclaiming “Open to All”), which consisted of lunch, prayer, a round table group of bible-investigators, and another 75-90 minutes of discussion by some VERY knowledgeable ministers (when first I attended one of these, the pastor staff consisted of a Senior Pastor, an Assistant Pastor, and an unpaid Associate Pastor - these three were SO gung ho into the Good Book that they would bring volumes of commentaries on the particular book of the bible being studied and point out matters that might easily escape the eye of one new to Bible study.
I have here only scratched the surface of what this precious gem of a congregation brings bright-shining to a stranger who first enters its doors (all of which but one are locked during the worship service, the better to keep the young Sunday School children safe from those whose intentions are not good) in radiant, loving splendor its church members, and even non-members who regularly attend because once you meet these loving people, they become part of you in a way that is unique. St. Paul's is like a magnet; once you come under its orbit, you are there forever.
Come one; Come all; the words "All Are Welcomed in this Place," were never spoken and written more truer to what is practiced and believed by the denizens of this faith community, and you may rest assured, these words are used on the web page of another protestant church in town, but the senior pastor, the staff, and the congregation DO NOT PUT INTO PRACTICE these words: Citing just two examples, the senior pastor prohibted entrance into the church a 47-year member who had been confirmed there; for over one year, a black woman attended the services and spoke with great length with the then senior pastor (no longer at the local, Barrington church, of her saddness that not once did any member invite her into their homes from coffee, or lunch, and this, she really could not understand, because they all seemed to kind and loving in the Narthex (she also commanded that the senior pastor not tell anyone of what she had told him, and, he quite wrongly to my mind, did as she had requested – sometimes it is far more cruel to be kind; sometimes we must make promises and tell lies we have no intention of keeping).
God Bless You, St Paul's United Church of Christ of Barrington, Illinois - you have been better to me and more caring for me than my own family, than my original Barrington Church where I was at one time or another actively involved in 14 different ministries; more accepting and less judgmental of me than most of my so-called "closest" friends; you fear me not nor do you fear to call me on my stupidity (or pride, or vanity) because you LOVE me enough to risk making me angry, were I not aware that you do these things only out of loving concern, and that your loving concern is well placed and based on the experience of many years of trials and tribulations which virtually every human being will encounter at one time of crisis or another in their lives.
May the peace of the Lord God almighty reside within you, and within your households, and within the lives of all the people and creatures you love, these things I ask, heavenly Father, in the name of your Beloved Son, Jesus the carpenter, fisher, teacher, healer, teller of stories, rabbi, teacher, saviour, if it be Thy Will, AMEN.
With LOVE to you, and ALL You LOVE,
Mark Raymond Ganzer
So wonderful and timely to see you in church today. Thanks for the lift back home, and for listening to my remarkable epiphany.
This is what the Lord has put onto my heart: back to your original idea to stage "events" for membership outreach physically on the grounds of St Paul's, this IS the way to go, if the church council can be sold on the idea of a regularly scheduled, periodic meeting on Sunday afternoons, and the right thing to do is to target other praise band teams in the area, inviting them to put on about 25-30 minute performances, with enough participants to provide about a 3-hour venue (probably open mic is the right way to present it - with the stipulation that each week would be featured performers from various of the local churches) for fellowship, worship, praise, food, coffee, cola, singing, song, and dancing. SOMEBODY has to host the event; it may as well be St Paul's, unless or until someone else steps up to take up the cause (ultimately, a rotating format might be the way to go, if there is enough interest from local churches).
Teen-aged suicide awareness falls quite naturally into this purview (we need to discuss with Paul Tack, who worked many years with my mother at the Jewel Tea Corporation what it is that St. Anne is doing in this regards. To my knowledge, this is the only local church that actively addresses this issue, counseling its children on how to recognize the signs of at-risk-for-suicide youths. To my knowledge this is the only local organization that dares to even whisper the words "teen suicides" in the same breath; the 800-pound gorilla in the living room).
I was so impressed with Jana's acknowledgement of Dark-side Jana today. I had not given her credit for so much self-awareness, although I do believe that if I were to tell her of the five specific instances in which she exposed her evil-spirited bitchy side, and NOT merely to me, she might faint away dead that she had been caught so off guard. But, perhaps, like the recalcitrant child, she recognized that I could be the one to be counted upon for calling her on her bull feathers. I daresay y'all have some boundary issues that make you reluctant to do so, as was discussed at the round table this afternoon.
I'd like you to present the following to Jana and the rest of the leadership crew (star-ship St Paul's UCC, boldly going where no churches have gone before). You'll never get a more sincere, nor more heartfelt, nor better written recommendation than this one (he said, as a statement of fact, which no pride whatsoever; it simply is what it is).
==========================================================================
Saint Paul's United Church of Christ
401 East Main Street
Barrington, Illinois 60010
As kind, generous, non-judgmental, loving, and caring a congregation as you'll ever find, is St. Paul's United Chruch of Christ in Barrington, Illinois. Many of Barrington's foremost and prominent community-serving families have their membership roots grounded here, where Pastor Jana Chwalisz is as a fine a composer and deliverer of sermons as has ever walked the planet. Rene Krupper the very gifted and pragmatic director of music, directs as individually talented a group of musicians as ever you will find, and she uses the various ensembles (Praise Team, Senior Choir, Handbell Choir) in a set rotation so that each ensemble has the opportunity to hear the other two ensembles at least two weeks out of every month.
Although a relatively small congregation (89 families signed pledge offerings for calendar year 2011), their leadership has dared to dream big dreams and will almost undoubtedly grow rapidly over the next five years.
Some of the really nice and things about the Sunday services include:
Large print for the Bulletin;
Their Hymnal is very traditional - they don't update it every 10 years or so, as to the Lutherans, sometimes, or so it seems, for the mere sake of updating the hymnal;
They actively embrace, welcome and nourish gay couples;
They actively embrace, welcome, and nourish peoples of color;
They proudly proclaim the names of the relatives of those who attend that serve in the military;
They proudly fly the American flag;
Each week, as part of the regular devotional service, Pastor Jana asks those assembled to tell of prayers which have been answered, or prayers which are needed for friends / family / loved ones, or even groups of poor and marginalized peoples from all over the globe, and upon collecting all the information, then prays for them leading the congregation in prayer, and then ensures that these people / groups are placed in the following week's church bulletin to ensure at least one more week of on-going prayers for them.
The church had 150 children in their summer vacation Bible school (the word is out - St Paul's does GOOD by your kids);
The elected church council has been dealing with issues few churches see in 100 years these past 12 months and has developed and implemented innovative action plans to deal with the realities of an ongoing (since 1854) but relatively stagnant membership population as thoughtfully, insightfully, and imaginatively creative, willing to learn, willing to grow, willing to change, honest and open as any you will EVER encounter. They also recognize these times of trials and tribulations as an incredible opportunity to sit back and take a very close look at just what it means to be a church; just what the church expects from its pastor; just what the pastor has to offer the church; just what the church needs to do to prosper, GROW, and thrive.
This past year they had to deal with some of the most difficult decisions an established church will ever have to come to grips with and dealt with fundamental questions about just what it was that the church wanted, needed, and expected from its pastoral staff, and what was realistic to ask of said staff. Their response was one that ENRON might well have paid $1,00,000 to a management consulting firm to produce.
If you enter a church service a stranger, you will leave with at least three new and very close, caring friends.
The membership is quite familiar with and sympathetic to the human condition, and they are NOT afraid to tell you when you have done something stupid THAT you have done something stupid, but invariably append, "We love you anyway; we simply had to tell you for your own good because CLEARLY nobody else cares enough about you to tell you these simple (and very obvious) truths."
The UCC is very active in its support to countries around the world. St Paul has sent ministers and congregants to the southern reaches of Mexico where Commandante Marcos and the indigenous Indian peoples are engaged in a struggle to reclaim lands from the wealthies of land-owners for the poor peoples of Southern Mexico.
The church is strongly engaged in local ministries and outreaches to the less fortunate citizens of the area. The church has a sister-church and the two churches engage in joint projects to proclaim and affirm the love of God in their lives.
BEST PART of Sunday worship is the fellowship snacks and coffee afterwards, where virtually every one who attended the service can be found in the fellowship hall sitting or standing, coffee cup in hand, chatting with old friends, or the newest faced visitor (even ones with very bad hair cuts; even ones with hair dyed BLUE!).
I was first drawn to enter the church doors and engage due to the Wednesday afternoon Bible Study (proudly proclaiming “Open to All”), which consisted of lunch, prayer, a round table group of bible-investigators, and another 75-90 minutes of discussion by some VERY knowledgeable ministers (when first I attended one of these, the pastor staff consisted of a Senior Pastor, an Assistant Pastor, and an unpaid Associate Pastor - these three were SO gung ho into the Good Book that they would bring volumes of commentaries on the particular book of the bible being studied and point out matters that might easily escape the eye of one new to Bible study.
I have here only scratched the surface of what this precious gem of a congregation brings bright-shining to a stranger who first enters its doors (all of which but one are locked during the worship service, the better to keep the young Sunday School children safe from those whose intentions are not good) in radiant, loving splendor its church members, and even non-members who regularly attend because once you meet these loving people, they become part of you in a way that is unique. St. Paul's is like a magnet; once you come under its orbit, you are there forever.
Come one; Come all; the words "All Are Welcomed in this Place," were never spoken and written more truer to what is practiced and believed by the denizens of this faith community, and you may rest assured, these words are used on the web page of another protestant church in town, but the senior pastor, the staff, and the congregation DO NOT PUT INTO PRACTICE these words: Citing just two examples, the senior pastor prohibted entrance into the church a 47-year member who had been confirmed there; for over one year, a black woman attended the services and spoke with great length with the then senior pastor (no longer at the local, Barrington church, of her saddness that not once did any member invite her into their homes from coffee, or lunch, and this, she really could not understand, because they all seemed to kind and loving in the Narthex (she also commanded that the senior pastor not tell anyone of what she had told him, and, he quite wrongly to my mind, did as she had requested – sometimes it is far more cruel to be kind; sometimes we must make promises and tell lies we have no intention of keeping).
God Bless You, St Paul's United Church of Christ of Barrington, Illinois - you have been better to me and more caring for me than my own family, than my original Barrington Church where I was at one time or another actively involved in 14 different ministries; more accepting and less judgmental of me than most of my so-called "closest" friends; you fear me not nor do you fear to call me on my stupidity (or pride, or vanity) because you LOVE me enough to risk making me angry, were I not aware that you do these things only out of loving concern, and that your loving concern is well placed and based on the experience of many years of trials and tribulations which virtually every human being will encounter at one time of crisis or another in their lives.
May the peace of the Lord God almighty reside within you, and within your households, and within the lives of all the people and creatures you love, these things I ask, heavenly Father, in the name of your Beloved Son, Jesus the carpenter, fisher, teacher, healer, teller of stories, rabbi, teacher, saviour, if it be Thy Will, AMEN.
With LOVE to you, and ALL You LOVE,
Mark Raymond Ganzer
Saturday, November 19, 2011
The Defense Death Spiral: from Chuck Spinney's Blog (by Chuck Spinney)
http://chuckspinney.blogspot.com/p/links-to-my-reports.html
Why the Pentagon is Always Underfunded
The courtiers in the Hall of Mirrors that is Versailles on the Potomac are lining up to give Leon Panetta advice on how to manage the Pentagon in the coming era of budget “constraints.” Most of this wisdom takes the form of platitudes of how important it is to have a strategy and to make the hard choices needed to budget for that strategy. Duh!
My current favorite is Dr. Daniel Goure’s recent blog on the web page of the Lexington Institute, a pro-defense “think tank.” Goure starts his advisory by saying:
Let’s be honest. The current U.S. defense program is underfunded, even at over $500 billion a year in the base budget and another $100 billion plus in contingency expenses.
Goure then goes on to discuss the need for vision, particularly concerning controlling personnel and health costs and avoiding duplication by transferring work done in government facilities, and by the military, to contractors. In other words, when times are tough, return to the old game of protecting industry at the expense of the soldier and the taxpayer.
Thanks for your honesty, Daniel, but more of the same won’t cut it this time.
Goure is correct about one thing, however. The defense program is underfunded. But before dispensing advice on how to shovel money to his friends in industry, Goure ought to explain how and why the highest budget since the end of World War II could possibly end up underfunding the current program. After all, the United States is engaged in a tough but relatively small war on terror, with far smaller forces and minuscule operational tempos compared to those deployed to either Korea and Vietnam.
Moreover, the United States no longer needs to spend a large part of the defense budget to maintain a large forward deployed conventional and nuclear forces to counter the threat posed by the Soviet Union. With a few minor exceptions, the United States is also fielding the smallest combat-coded force structures since 1950. Nevertheless, despite a defense budget that has almost doubled in inflation adjusted dollars since 1998, Mr. Panetta is inheriting a defense program approaching the programmatic equivalent of a meltdown.
Why?
If Mr. Panetta wants to nurse the Pentagon into to health he must come to grips with the real causes of the Defense Death Spiral — a problem I have been studying and writing about since the late 1970s.
The central management problem plaguing the Department of Defense -- i.e., the meltdown of the entire defense program -- can be characterized in a general sense as being produced by the mutually reinforcing effects of A modernization program that cannot buy enough new weapons to modernize the force structures of the Army, Navy/MC, and Air Force, because the unit costs of new weapons always grow faster than budgets, even when budgets increase sharply, as they did in the 1980s and after 1998;
Continual budgetary pressure to reduce readiness and shrink force size to contain the growth of operating costs (from operating aging, more complex hardware, but also from the growing personnel costs of the all volunteer force) to free up funds to finance the bankrupt modernization program; and Corrupt and unauditable accounting, financial management, and program planning systems that lubricate the degenerative process by making impossible to assemble the information needed to sort out and correct the first two problems.
As long as these three relations remain in place, the defense budget will always be underfunded. In fact, as I explained to Senator John Tower during testimony to Congress in 1983, "spending more money the same way actually makes matters worse." A near doubling of the defense budget since 1998 has shown again that statement to be correct.
This is the fundamental management dilemma facing Mr. Panetta. Resolving it won’t be easy, because this trifecta of structural problems is only the outward manifestation of a bureaucratic engine powered by deeper behavioral pathologies that insensibly built up over during the 40 years of Cold War and are now seamlessly embedded in the culture of the Pentagon, the defense industry, and their wholly owned subsidiaries in Congress -- these habitual modes of conduct are known as the defense power games (front loading and political engineering).
The defense power games, together with their trifecta of external manifestations, effectively turn the decision making process and program planning processes inward and disconnect the entire decision/policy making effort from external reality, including the threats it purports to cope with, the strategy alleged to meet those threats, and the shaping of force structures needed to execute the strategies. The resulting self-referential decision making engine — referred to by some wags in the Pentagon as a self-licking ice cream cone — creates the inwardly-focused death spiral portrayed by the following figure.
Simply repeating the same old empty platitudes about having a strategy and fitting forces and budgets to that strategy leads nowhere, because the Pentagon decision process that consumes millions of man hours each year to create this mess year after year — the Planning, Programming, and Budgeting System — already is designed precisely to link threats to strategy to programs and then to budgets! The real problem is why it fails to do so year after year — which brings us back to a diagnosis of the pathologies.
The repetitive pattern of these pathologies and their effects have been well understood and have been well documented since the early 1980s. Moreover, the programmatic meltdown the Defense Department is experiencing today was foreseen by the late 1980s and early 1990s. Nevertheless, with a few lonely exceptions, notably Senator Charles Grassley (R-Iowa), no one in leadership positions in the Pentagon, Congress, or the White House has taken any interest in correcting the Pentagon's self destructive patterns of behavior.
For this reason, at the end of the 1980s, I decided the only thing I could do was to begin documenting these problems for posterity. My intent was to provide a track record showing how these problems were indeed foreseeable and how they could have been avoided, if the leaders in the Pentagon chose to make that effort. They did not -- and today, the American public is reaping the Pentagon's bitter harvest of shame -- an underfunded defense program in chaos even though is being funded by largest budgets since the end of World War II (after removing the effects of inflation). Those who blame this mess on the war on terror and out of control personnel and medical costs are selling snake oil to grease a continuation of this destructive pattern of business as usual.
This link, for example, will take you some of my more important unclassified reports and papers describing these problems: They explain why and how the Defense program has been in a continuous state of unraveling. They predicted what would happen if these behavioral pathologies were left on unaddressed. My June 2002 statement to Congress outlined a comprehensive plan for fixing these general decision-making problems. I don’t know if that plan will work, but at least it was designed to address the real causes of the underfunding problem.
TACAIR Case Study
No mission area reveals the Pentagon’s behavioral pathologies more clearly than tactical fighter aviation or TACAIR. As the Cold War was ending in the early 1990s, the Air Force, Navy, and Marine Corps wanted to embark on a new generation of high-cost, high-complexity fighter/attack aircraft (these became the F-22, F/A-18E/F, and the F-35 Joint Strike Fighter).
To summarize a somewhat complex story: In 1991, just as the Cold War was ending, the AF front loaded the F-22 by pushing it prematurely though decision-making milestone II into concurrent engineering and manufacturing development (EMD, aka Milestone II). This decision allowed the contractor (Lockheed Martin) to begin the construction of a social safety net by spreading dollars, jobs, and profits to many congressional districts, a power game known as political engineering. Front loading and political engineering are explained in Defense Power Games. Less than a year later, the Navy pulled off the same stunt by prematurely rushing the F-18E/F into EMD for the same reason. Both airplanes were high cost legacies of Cold War thinking. The objective of the decision making game in each case was to turn on the money spigot and lock it open; in effect, the goal was to let the Cold-War cows out the Cold-War barn before its door closed.
It is important understand that the senior military and civilian decision makers in the Pentagon responsible for rushing these two decisions knowingly created a long term force structure crisis. They knew beforehand that the Pentagon's contractors could not possibly produce enough new F-22s and F-18E/Fs quickly enough (even in the unlikely event where there were no delays due to cost overruns and technical problems) to replace the 3,000-plus fighter/attack aircraft in the inventories on a timely basis. Consequently, decision makers knew before the fact that the average age of the older airplanes remaining in that inventory would rapidly grow to unprecedented levels and that the increased aging would lead to unpredictable increases in future operating budgets. They also knew before the fact that only way to slow down the increased rate of aging would be to approve a drastic reduction in the size of those inventories by retiring the oldest airplanes without replacement.
The senior decision makers responsible for these decisions also knew beforehand that the force-structure crisis created by the F-22/F-18E/F decisions would became the source of enormous extortionary pressure to approve the development two years later of yet a third high cost fighter/attack program -- what was to become the problem-plagued F-35 Joint Strike Fighter -- yet another Cold-War-inspired concoction of highly complex and costly technologies that is now the most expensive single weapons program in history.
Put bluntly, the disastrous ramifications of these reckless decisions were known before they were approved. If you don’t believe me, you can download and read my reports. They describe how this was being done while it was being done — they can be found here in the subsection entitled “Specific Reports on Tactical Fighters.” Together, with my March 1996 essay, Defense Budget Time Bomb, the case of tactical aviation provides the clearest evidence of how the Pentagon bureaucracy, with malice of forethought, deliberately created the modernization crisis that metastasized after 2000 and is now staring Mr. Panetta in face. But if you think I am cherry picking my data by focusing on TACAIR, a more general, albeit more complex picture of the same general pattern of decision making can be found in my unclassified 1998 briefing, Defense Death Spiral.
That, in a nutshell, is the dirty story of why the defense budget is underfunded, but you won’t hear this story from courtiers trying to ingratiate themselves with the new Secretary of Defense. Given that political pressure is mounting to cut back non-defense programs including Social Security, Medicare, education, infrastructure, etc., to reduce deficit, I submit the time has come to rein in the Pentagon’s out of control budget, to discipline its reckless behavior, and to force it to clean up its act.
Job 1 is to provide more reliable programmatic information to the Secretary of Defense, so he and his staff can figure out how to pull the Pentagon out of its death spiral. The only incentive to force this is to put the entire core budget at "risk," say by placing the core (non-war related) budget on a downward sloping glide path of 2 to 4% per year (in current as opposed to inflation-adjusted dollars) until the Pentagon can produce auditable books. That would simply bring it into compliance with Chief Financial Officers Act of 1990 and the Accountability and Appropriations Clauses of the Constitution. Given that every member of the Defense Department has taken a sacred oath to protect the Constitution, making the Pentagon conform to the requirements of the Constitution is hardly an onerous requirement.
Only with cleaner books can serious policy-making and strategic planning begin. Readers interested in a short primer written by defense insiders, with over 400 years of collective experience, on how to think about defense and what kinds of changes can and should be made once we have reliable information are referred to the The Pentagon Labyrinth: 10 Short Essays to Help You Through It.
Who knows, if we can force the Pentagon to think before it spends, the United States might be able to field a military that meets the threats it faces at a cost the nation can afford.
Thursday, November 17, 2011
Being jerked out of that comfort zone - and the damned papers don't quite figure out why they lose so much readership!
PENNING: Newspaper changes can feel personal
It is like the casualties of war.
First, you hear general reports of American soldiers killed in a far-off country. Then you read a profile of a soldier from a town nearby who made the ultimate sacrifice.
Finally, you know someone who lost a family member, or that family member was your own. That’s when it becomes what we call “personal.”
While certainly not as serious as death and war, watching the slow decline of the newspaper industry has parallels.
First, there are stories about the news media outlets in general struggling to retain audience in this Internet era. Then there are reports of lost advertising revenue. This is followed by noticeable differences in the size and number of pages in some national newspapers. Then some staff at a nearby newspaper are let go. Then home delivery is reduced or eliminated. Finally, the “paper” exists online only — if at all.
Such was the case with the shocking — yet what seems inevitable announcement — that a nearby newspaper, the Grand Rapids Press, will only deliver an actual paper three days a week, beginning early next year. I teach and study media, and I have watched and commented on the changes in media for several years now.
But this? The paper that I wrote for briefly as a young college graduate with a journalism degree? Going from a “daily” to delivery only three days a week?
This is personal.
I grew up in Grand Rapids. A newspaper landing on our front stoop is one of my early memories. My parents didn’t allow us to watch much television — and there were no video games, Internet, texting or other distractions young people have today. So, after doing my homework and playing while there was available daylight, I often would hang out in the living room and read the paper.
I started the habit watching my dad, a plumber, come home from work and retire to a La-Z-Boy chair, his thick gray socks sticking out over the pull-out foot rest, a copy of the paper held in the air. It would be about 20 minutes before he put it down and dozed.
I picked up the newspaper the first time out of boredom and curiosity. But soon it was a habit. I had a natural interest in what was going on in the community and the world.
As someone who loved to read, I was fascinated that you could have a job doing that for a newspaper. Journalism became my first career calling. Plumbing was never a consideration.
Since then, I’ve moved into public relations and education. But I never lost my love of a newspaper.
I’m happy to say, some of my students share that love. Not enough of them, according to conversations I have with classes, as well as national survey data about newspaper readership.
However, some of them not only read online, but love an actual paper newspaper. They love the tactile pleasure of newsprint in hand. Several even said they love the smell of a newspaper. I smiled to hear one say that a cup of coffee and a newspaper remain one of life’s simple pleasures.
But all that’s changing. The paper you are reading now still is delivered six days a week. But it is also available on computer and mobile device, in various formats. In one sense, this sounds like progress. But I also worry.
What about people who can’t afford computers or aren’t technically adept enough to read online media? What about the online environment in which we are overwhelmed with content, but nevertheless can feel less informed? Will newspapers be able to survive economically, or will they move to the Internet and then one day just cease to exist altogether as a cacophony of bloggers take over?
Perhaps I worry too much. There is much to gain from technological advances. I enjoy accessing the Tribune wherever I am around the world when I travel. The multimedia content, such as video clips and links to related content, enhance the original reporting.
The ability for readers to comment on articles, and each others’ comments, adds a whole new community feeling to a community newspaper. It actually could improve what media scholars call the “public sphere,” in which journalists report and society discusses politics and other relevant information of the day.
I don’t really think newspapers are going to die. But they are changing.
Maybe “casualties of war” is too strong a metaphor. It’s more like the feeling I imagine my friends have when their children leave the home for college or a job.
There is excitement and pride about inevitable progress and change. But there is also a nagging, nostalgic twinge in the heart about losing something special.
It is like the casualties of war.
First, you hear general reports of American soldiers killed in a far-off country. Then you read a profile of a soldier from a town nearby who made the ultimate sacrifice.
Finally, you know someone who lost a family member, or that family member was your own. That’s when it becomes what we call “personal.”
While certainly not as serious as death and war, watching the slow decline of the newspaper industry has parallels.
First, there are stories about the news media outlets in general struggling to retain audience in this Internet era. Then there are reports of lost advertising revenue. This is followed by noticeable differences in the size and number of pages in some national newspapers. Then some staff at a nearby newspaper are let go. Then home delivery is reduced or eliminated. Finally, the “paper” exists online only — if at all.
Such was the case with the shocking — yet what seems inevitable announcement — that a nearby newspaper, the Grand Rapids Press, will only deliver an actual paper three days a week, beginning early next year. I teach and study media, and I have watched and commented on the changes in media for several years now.
But this? The paper that I wrote for briefly as a young college graduate with a journalism degree? Going from a “daily” to delivery only three days a week?
This is personal.
I grew up in Grand Rapids. A newspaper landing on our front stoop is one of my early memories. My parents didn’t allow us to watch much television — and there were no video games, Internet, texting or other distractions young people have today. So, after doing my homework and playing while there was available daylight, I often would hang out in the living room and read the paper.
I started the habit watching my dad, a plumber, come home from work and retire to a La-Z-Boy chair, his thick gray socks sticking out over the pull-out foot rest, a copy of the paper held in the air. It would be about 20 minutes before he put it down and dozed.
I picked up the newspaper the first time out of boredom and curiosity. But soon it was a habit. I had a natural interest in what was going on in the community and the world.
As someone who loved to read, I was fascinated that you could have a job doing that for a newspaper. Journalism became my first career calling. Plumbing was never a consideration.
Since then, I’ve moved into public relations and education. But I never lost my love of a newspaper.
I’m happy to say, some of my students share that love. Not enough of them, according to conversations I have with classes, as well as national survey data about newspaper readership.
However, some of them not only read online, but love an actual paper newspaper. They love the tactile pleasure of newsprint in hand. Several even said they love the smell of a newspaper. I smiled to hear one say that a cup of coffee and a newspaper remain one of life’s simple pleasures.
But all that’s changing. The paper you are reading now still is delivered six days a week. But it is also available on computer and mobile device, in various formats. In one sense, this sounds like progress. But I also worry.
What about people who can’t afford computers or aren’t technically adept enough to read online media? What about the online environment in which we are overwhelmed with content, but nevertheless can feel less informed? Will newspapers be able to survive economically, or will they move to the Internet and then one day just cease to exist altogether as a cacophony of bloggers take over?
Perhaps I worry too much. There is much to gain from technological advances. I enjoy accessing the Tribune wherever I am around the world when I travel. The multimedia content, such as video clips and links to related content, enhance the original reporting.
The ability for readers to comment on articles, and each others’ comments, adds a whole new community feeling to a community newspaper. It actually could improve what media scholars call the “public sphere,” in which journalists report and society discusses politics and other relevant information of the day.
I don’t really think newspapers are going to die. But they are changing.
Maybe “casualties of war” is too strong a metaphor. It’s more like the feeling I imagine my friends have when their children leave the home for college or a job.
There is excitement and pride about inevitable progress and change. But there is also a nagging, nostalgic twinge in the heart about losing something special.
— By Tim Penning. His columns and other thoughts can be read on his PierPoints blog: http://pierpoints.blogspot.com [1].
2 frickin' 39 point 6
Checked my weight on the digital scale up here in the 'puter room today and it read: 239.6!
Hot fricken damn! First time under 240 since, what? 2009? or earlier?
That might help get the ole' BP down (can't find my damn meds; crappolies - had an entire box filled with pills, none of which am I taking; my pharmacy, and now, can't even find it, sigh.
Hot fricken damn! First time under 240 since, what? 2009? or earlier?
That might help get the ole' BP down (can't find my damn meds; crappolies - had an entire box filled with pills, none of which am I taking; my pharmacy, and now, can't even find it, sigh.
It ain't just white Christians that get religiously discriminated against here in 'Muricaw
Complaints of religious discrimination in workplace are increasing
Published: Thursday, November 17, 2011, 6:00 AM Updated: Thursday, November 17, 2011, 7:00 AM
By Marcia Pledger, The Plain Dealer
Joshua Gunter, The Plain Dealer
Suhad Hasan, a former Old Navy employee, sued the store's parent company Gap Inc. last month, saying she was treated unfairly because she wears a head scarf. The Parma resident, who now works as a home health aide, is among a growing number of people nationwide who filed religious-based complaints with the Equal Employment Opportunity Commission.
CLEVELAND, Ohio -- Northeast Ohio native Suhad Hasan, a hijab-wearing Muslim, says neither her head scarf nor her religion should be an issue where she works.
But she said they were while she was a sales associate at the Old Navy clothing store in Santa Clara, Calif., three years ago. Hasan said she was assigned to work in the fitting room and was never offered training for other positions that was given to non-Muslims, despite her repeated requests to be trained.
After several months and still working in the fitting room, Hasan moved back to Ohio, only to be denied what she said was supposed to be an automatic transfer to a job in another Old Navy store. She found herself without a job, all because of what she describes as discrimination because of who she is and what she looks like.
"I was born and raised in the United States and I pay taxes like everybody else," said Hasan, 39, now a Parma resident who last month sued Gap Inc., the parent company of Old Navy. "What I wear on my head and the god that I believe in should not be an issue in the workplace."
The number of complaints like Hasan's is steadily rising. Equal Employment Opportunity Commission statistics show that religious discrimination complaints in workplace settings have more than doubled from a little over a decade ago, resulting in roughly $10 million in settlements. Last year, nearly 3,800 were filed -- 136 of them with the Cleveland EEOC office.
"Religion has increasingly moved into the private sphere, so when it does pop up in the workplace, we're less equipped to deal with it in a rational and even-handed manner," said John Gordon, chairman of the religion department at Baldwin-Wallace College, who believes the increase is a result of being a more multi-cultural, more multi-faith country.
The Gap did not respond to emails or phone calls this week.
Many of the complaints from employees involve wearing head garb or those who say they work for companies that refuse to accommodate their requests for religious days off.
Cynthia Stankiewicz, enforcement manager for the EEOC Cleveland field office, said not allowing time off for religious observances is a common issue. She said many cases come about when employers aren't aware of employees' rights or when employers don't attempt to accommodate requests that do not pose a hardship on the business.
She cited a case where an assistant manager at a local fast-food restaurant fired an employee after only a day on the job after claims that the worker's headscarf was a fire hazard.
"In most cases, employers don't have a good valid job-related reason for religious discrimination," she said. "It's often based on fears, myths and stereotypes."
The law requires employers to make reasonable accommodations to "sincerely held" religious beliefs of employees as long as doing so poses no undue hardship on the employer, EEOC says. When that doesn't happen, EEOC said it steps in but only after first attempting to reach a pre-litigation settlement with the employer.
A few months ago, the commission stepped in and sued a Rent-A-Center in Washington, D.C., on behalf of an employee, saying the company violated federal law when it failed to accommodate the store manager's religious beliefs, and then fired him because of his religion. EEOC charged that the manager, a Seventh-Day Adventist, had asked to be excused from working on Saturdays before sundown, but his request was denied.
Last summer, a Toledo-based nursing home settled a religious discrimination lawsuit, paying the employee $30,000 and offering training to all employees, including managers in the region, on recognizing and preventing religious discrimination, EEOC said.
"An employee should not be forced to choose between his faith and his job," Lynette Barnes, a regional attorney for EEOC, said in a press release involving the Rent-A-Center case.
Still, an employer can turn down a request if that means training someone else, at a substantial cost, to cover for the worker who doesn't want to work on Saturdays for religious reasons, Stankiewicz said.
Also, employers are not required to pay premium or overtime costs in order to accommodate religious needs. Or undue hardships could become an issue if a collective bargaining agreement includes rules regarding seniority and assignments.
"It's a complex thing. Almost every case is unique," said Gordon at Baldwin Wallace. "A particular employer may really have a bias or an employee might be unreasonable."
While employers tend to be familiar with sexual harassment, family leave, age discrimination, and the Americans with Disabilities Act, employers may not even be aware of the law regarding religion in the workplace until they face a religious challenge, said Julia Shearson, executive director of the Council on American Islamic Relations-Ohio in Cleveland.
Civil rights attorney and law professor Avery Friedman, who has represented employees for the last four decades, said he's not surprised about the increase in EEOC complaints about religious workplace issues.
"The rise relates to how certain groups are perceived, coupled with people who carry their faith-based precepts and act as missionaries in the workplace," he said.
Since returning to Ohio, Hasan has landed a job as a home health aide. She said she is still shaken by her experience with Old Navy.
"I was raised to respect all religions. But when you attack my hijab, you're demeaning my beliefs and my religion," she said.
© 2011 cleveland.com. All rights reserved.
Published: Thursday, November 17, 2011, 6:00 AM Updated: Thursday, November 17, 2011, 7:00 AM
By Marcia Pledger, The Plain Dealer
Joshua Gunter, The Plain Dealer
Suhad Hasan, a former Old Navy employee, sued the store's parent company Gap Inc. last month, saying she was treated unfairly because she wears a head scarf. The Parma resident, who now works as a home health aide, is among a growing number of people nationwide who filed religious-based complaints with the Equal Employment Opportunity Commission.
CLEVELAND, Ohio -- Northeast Ohio native Suhad Hasan, a hijab-wearing Muslim, says neither her head scarf nor her religion should be an issue where she works.
But she said they were while she was a sales associate at the Old Navy clothing store in Santa Clara, Calif., three years ago. Hasan said she was assigned to work in the fitting room and was never offered training for other positions that was given to non-Muslims, despite her repeated requests to be trained.
After several months and still working in the fitting room, Hasan moved back to Ohio, only to be denied what she said was supposed to be an automatic transfer to a job in another Old Navy store. She found herself without a job, all because of what she describes as discrimination because of who she is and what she looks like.
"I was born and raised in the United States and I pay taxes like everybody else," said Hasan, 39, now a Parma resident who last month sued Gap Inc., the parent company of Old Navy. "What I wear on my head and the god that I believe in should not be an issue in the workplace."
The number of complaints like Hasan's is steadily rising. Equal Employment Opportunity Commission statistics show that religious discrimination complaints in workplace settings have more than doubled from a little over a decade ago, resulting in roughly $10 million in settlements. Last year, nearly 3,800 were filed -- 136 of them with the Cleveland EEOC office.
"Religion has increasingly moved into the private sphere, so when it does pop up in the workplace, we're less equipped to deal with it in a rational and even-handed manner," said John Gordon, chairman of the religion department at Baldwin-Wallace College, who believes the increase is a result of being a more multi-cultural, more multi-faith country.
The Gap did not respond to emails or phone calls this week.
Many of the complaints from employees involve wearing head garb or those who say they work for companies that refuse to accommodate their requests for religious days off.
Cynthia Stankiewicz, enforcement manager for the EEOC Cleveland field office, said not allowing time off for religious observances is a common issue. She said many cases come about when employers aren't aware of employees' rights or when employers don't attempt to accommodate requests that do not pose a hardship on the business.
She cited a case where an assistant manager at a local fast-food restaurant fired an employee after only a day on the job after claims that the worker's headscarf was a fire hazard.
"In most cases, employers don't have a good valid job-related reason for religious discrimination," she said. "It's often based on fears, myths and stereotypes."
The law requires employers to make reasonable accommodations to "sincerely held" religious beliefs of employees as long as doing so poses no undue hardship on the employer, EEOC says. When that doesn't happen, EEOC said it steps in but only after first attempting to reach a pre-litigation settlement with the employer.
A few months ago, the commission stepped in and sued a Rent-A-Center in Washington, D.C., on behalf of an employee, saying the company violated federal law when it failed to accommodate the store manager's religious beliefs, and then fired him because of his religion. EEOC charged that the manager, a Seventh-Day Adventist, had asked to be excused from working on Saturdays before sundown, but his request was denied.
Last summer, a Toledo-based nursing home settled a religious discrimination lawsuit, paying the employee $30,000 and offering training to all employees, including managers in the region, on recognizing and preventing religious discrimination, EEOC said.
"An employee should not be forced to choose between his faith and his job," Lynette Barnes, a regional attorney for EEOC, said in a press release involving the Rent-A-Center case.
Still, an employer can turn down a request if that means training someone else, at a substantial cost, to cover for the worker who doesn't want to work on Saturdays for religious reasons, Stankiewicz said.
Also, employers are not required to pay premium or overtime costs in order to accommodate religious needs. Or undue hardships could become an issue if a collective bargaining agreement includes rules regarding seniority and assignments.
"It's a complex thing. Almost every case is unique," said Gordon at Baldwin Wallace. "A particular employer may really have a bias or an employee might be unreasonable."
While employers tend to be familiar with sexual harassment, family leave, age discrimination, and the Americans with Disabilities Act, employers may not even be aware of the law regarding religion in the workplace until they face a religious challenge, said Julia Shearson, executive director of the Council on American Islamic Relations-Ohio in Cleveland.
Civil rights attorney and law professor Avery Friedman, who has represented employees for the last four decades, said he's not surprised about the increase in EEOC complaints about religious workplace issues.
"The rise relates to how certain groups are perceived, coupled with people who carry their faith-based precepts and act as missionaries in the workplace," he said.
Since returning to Ohio, Hasan has landed a job as a home health aide. She said she is still shaken by her experience with Old Navy.
"I was raised to respect all religions. But when you attack my hijab, you're demeaning my beliefs and my religion," she said.
© 2011 cleveland.com. All rights reserved.
Enquiring Cosmologists Want to Know: How big is the universe, how old is it?
WHAT'S UP: Cosmology is big science
Anonymous
07:00 PM
Dec 31
1969
What is the universe — matter, energy, the fabric of space and time?
How big is the universe, how old is it?
How did the universe come into existence, or has it always been here?
What is its ultimate fate, or will the universe always be here?
These are grand questions. How shall we seek answers to these questions?
Shall we turn our thoughts inward as philosophers and theologians because questions of cosmology are questions of perception, and because the universe can only be exactly as we perceive it to be? Or shall we scrutinize the bits of matter in the space at our fingertips as engineers and physicists with microscopes and particle accelerators, poking and prodding what we can close to home?
Or do we look outward to the stars, with telescopes and other instruments that extend our senses, forming and testing theories, seeking objective truths as mathematicians and scientists — as astronomers?
I believe we must do all three — because questions of cosmology are so grand, so profound, that a clear path to their answers is not even apparent.
Human cultures as far back as history has kept records have contemplated questions of cosmology. But why?
Of all philosophical, scientific and religious endeavors that are far removed from the demands of everyday life, cosmology must be among the most distant. Cosmology peaks the interest of just about anyone who has ever had some small amount of time to contemplate a look to the heavens.
Carl Sagan — the famous astronomer and author who passed away in 1996 — is more eloquent: “The Cosmos is all that is or ever was or ever will be. Our feeblest contemplations of the Cosmos stir us — there is a tingling in the spine, a catch in the voice, a faint sensation of a distant memory, as if we were falling from a great height.”
Nov. 9 would have been Sagan’s 77th birthday, and annually the day is recognized by many organizations as “Carl Sagan Day.” Sagan was a champion of scientifically skeptical inquiry; and he told the story of our cosmology, our creation myth, in an entertaining and compelling way.
Do you remember seeing the PBS production of his book, “Cosmos: A Personal Voyage,” back in the 1980s? At the time, according to online sources, “Cosmos” was the most watched PBS series in the world. “Cosmos” brought cosmology to you and I.
Our cosmology is big science.
The 2011 Nobel Prize in physics was awarded to three observational cosmologists: Saul Perlmutter of the Lawrence Berkeley National Laboratory and the University of California, Berkeley; Brian Schmidt of the Australian National University; and Adam Riess of Johns Hopkins University. The prize was awarded “for the discovery of the accelerating expansion of the universe through observations of distant supernovae.”
The 2006 Nobel Prize in physics was also awarded to a team of observational cosmologists: John Mather of the NASA Goddard Spaceflight Center; and George Smoot of the University of California, Berkeley, for “for their discovery of the blackbody form and anisotropy of the cosmic microwave background radiation.”
It is true that our cosmology — the “big bang theory” and the so-called lambda-CDM model — is not accessible to many of us because it is rooted in difficult mathematics, and that our cosmology is not as colorful as ancient creation myths.
Yet, as for all that have come before us, our cosmology is our attempt to understand the universe and our place within it.
Anonymous
07:00 PM
Dec 31
1969
What is the universe — matter, energy, the fabric of space and time?
How big is the universe, how old is it?
How did the universe come into existence, or has it always been here?
What is its ultimate fate, or will the universe always be here?
These are grand questions. How shall we seek answers to these questions?
Shall we turn our thoughts inward as philosophers and theologians because questions of cosmology are questions of perception, and because the universe can only be exactly as we perceive it to be? Or shall we scrutinize the bits of matter in the space at our fingertips as engineers and physicists with microscopes and particle accelerators, poking and prodding what we can close to home?
Or do we look outward to the stars, with telescopes and other instruments that extend our senses, forming and testing theories, seeking objective truths as mathematicians and scientists — as astronomers?
I believe we must do all three — because questions of cosmology are so grand, so profound, that a clear path to their answers is not even apparent.
Human cultures as far back as history has kept records have contemplated questions of cosmology. But why?
Of all philosophical, scientific and religious endeavors that are far removed from the demands of everyday life, cosmology must be among the most distant. Cosmology peaks the interest of just about anyone who has ever had some small amount of time to contemplate a look to the heavens.
Carl Sagan — the famous astronomer and author who passed away in 1996 — is more eloquent: “The Cosmos is all that is or ever was or ever will be. Our feeblest contemplations of the Cosmos stir us — there is a tingling in the spine, a catch in the voice, a faint sensation of a distant memory, as if we were falling from a great height.”
Nov. 9 would have been Sagan’s 77th birthday, and annually the day is recognized by many organizations as “Carl Sagan Day.” Sagan was a champion of scientifically skeptical inquiry; and he told the story of our cosmology, our creation myth, in an entertaining and compelling way.
Do you remember seeing the PBS production of his book, “Cosmos: A Personal Voyage,” back in the 1980s? At the time, according to online sources, “Cosmos” was the most watched PBS series in the world. “Cosmos” brought cosmology to you and I.
Our cosmology is big science.
The 2011 Nobel Prize in physics was awarded to three observational cosmologists: Saul Perlmutter of the Lawrence Berkeley National Laboratory and the University of California, Berkeley; Brian Schmidt of the Australian National University; and Adam Riess of Johns Hopkins University. The prize was awarded “for the discovery of the accelerating expansion of the universe through observations of distant supernovae.”
The 2006 Nobel Prize in physics was also awarded to a team of observational cosmologists: John Mather of the NASA Goddard Spaceflight Center; and George Smoot of the University of California, Berkeley, for “for their discovery of the blackbody form and anisotropy of the cosmic microwave background radiation.”
It is true that our cosmology — the “big bang theory” and the so-called lambda-CDM model — is not accessible to many of us because it is rooted in difficult mathematics, and that our cosmology is not as colorful as ancient creation myths.
Yet, as for all that have come before us, our cosmology is our attempt to understand the universe and our place within it.
— By Doug Furton, a member of the physics faculty at GVSU. Send questions and suggestions to dgf@inbox.com.
Charming Story: Ottawa County tot takes dad’s car for spin, winds up CEO of GM
STRANGE GH: Ottawa County tot takes dad’s car for spin, winds up CEO of GM
Kevin Collier [1]
07:00 PM
Dec 31
1969
Ottawa County native Edward Nicholas Cole began his career with a crash — and sadly, his career ended with one, too.
But thanks to Cole, we can all breathe a little easier.
Cole was born in Berlin (Marne, Mich.) on Sept. 17, 1909, to Franklin and Lucy Cole. At the age of 5, the boy’s fascination with cars got him into trouble.
The year was 1914 when little Ed climbed into the driver’s seat of his father’s parked 1908 Buick, released the handbrake and went for short ride. The car struck a tree and came to a stop. Edward was unhurt and damage to the vehicle was minor.
His dad scolded him good, but that didn’t dampen Ed’s enthusiasm for the “horseless carriage.”
At age 16, Edward was one of the rare “two-car owners” in Marne when he rebuilt a pair of old vehicles. He also converted old Model A jalopies into homemade tractors, which he sold to area farmers, on his father’s property.
Cole began his automotive career in 1929 with General Motors in their Cadillac division. Soon after that, Cole married his hometown sweetheart, Esther “Dolly” Engman. He advanced his work in engineering to co-head a team that developed the 1949 Cadillac V-8.
His associates once said, “Ed just has one speed — full-throttle.”
He became chief engineer of the Chevrolet division in 1952. As general manager of Chevrolet, he directed the development of the Corvair, intended to pursue the compact car market. Cole was featured on the cover of Time magazine — Oct. 5, 1959, issue.
Cole was promoted to head the GM car and truck group in 1961, eventually becoming company president in 1967. He retired in 1974, then became chairman and CEO of Checker Motors Corp.
Cole deserves credit for weaning American cars off leaded gasoline by introducing catalytic converters to the market in 1975.
On May 2, 1977, Cole’s inspirational career ended as it had started it — with “a crash.” He died at age 67 during a storm while piloting his private twin-engine Beagle Series 2 airplane near Kalamazoo. The plane crashed 50 miles south of where he was born — Marne.
Literally, we can all breathe a little easier thanks to Cole’s innovative work, and it all began here in Ottawa County 97 years ago when a curious tot took his father’s car for a spin.
Kevin Collier [1]
07:00 PM
Dec 31
1969
Ottawa County native Edward Nicholas Cole began his career with a crash — and sadly, his career ended with one, too.
But thanks to Cole, we can all breathe a little easier.
Cole was born in Berlin (Marne, Mich.) on Sept. 17, 1909, to Franklin and Lucy Cole. At the age of 5, the boy’s fascination with cars got him into trouble.
The year was 1914 when little Ed climbed into the driver’s seat of his father’s parked 1908 Buick, released the handbrake and went for short ride. The car struck a tree and came to a stop. Edward was unhurt and damage to the vehicle was minor.
His dad scolded him good, but that didn’t dampen Ed’s enthusiasm for the “horseless carriage.”
At age 16, Edward was one of the rare “two-car owners” in Marne when he rebuilt a pair of old vehicles. He also converted old Model A jalopies into homemade tractors, which he sold to area farmers, on his father’s property.
Cole began his automotive career in 1929 with General Motors in their Cadillac division. Soon after that, Cole married his hometown sweetheart, Esther “Dolly” Engman. He advanced his work in engineering to co-head a team that developed the 1949 Cadillac V-8.
His associates once said, “Ed just has one speed — full-throttle.”
He became chief engineer of the Chevrolet division in 1952. As general manager of Chevrolet, he directed the development of the Corvair, intended to pursue the compact car market. Cole was featured on the cover of Time magazine — Oct. 5, 1959, issue.
Cole was promoted to head the GM car and truck group in 1961, eventually becoming company president in 1967. He retired in 1974, then became chairman and CEO of Checker Motors Corp.
Cole deserves credit for weaning American cars off leaded gasoline by introducing catalytic converters to the market in 1975.
On May 2, 1977, Cole’s inspirational career ended as it had started it — with “a crash.” He died at age 67 during a storm while piloting his private twin-engine Beagle Series 2 airplane near Kalamazoo. The plane crashed 50 miles south of where he was born — Marne.
Literally, we can all breathe a little easier thanks to Cole’s innovative work, and it all began here in Ottawa County 97 years ago when a curious tot took his father’s car for a spin.
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