Author: hankkalet

Hank Kalet is a poet and freelance journalist. He is the economic needs reporter for NJ Spotlight, teaches journalism at Rutgers University and writing at Middlesex County College and Brookdale Community College. He writes a semi-monthly column for the Progressive Populist. He is a lifelong fan of the New York Mets and New York Knicks, drinks too much coffee and attends as many Bruce Springsteen concerts as his meager finances will allow. He lives in South Brunswick with his wife Annie.

Financial reform is impressive, but full of leaks

Russ Feingold, the senator from Wisconsin, sums up the failure of financial regulatory reform, unmasking the claim that we have witnessed the greatest overhaul of the system since the Great Depression. It may be the most far-reaching reform, but that’s only because all we’ve done since World War II is back track from the New Deal.

It would be a huge mistake to pass a bill that purports to re-regulate the financial industry but is simply too weak to protect people from the recklessness of Wall Street. That would be like building an impressive-looking dam without telling everyone that it has a few leaks in it. False security is no security at all.

Email me at grassroots at comcast dot net.

Dispatches: Wrong questions

I’m posting my Dispatches column a day early directly to the blog. I’ll repost as a link tomorrow.

DISPATCHES: Wrong questions
On Afghanistan, it’s not how to win, but why are we still there
By Hank Kalet

If you keep asking the wrong questions, you are going to keep getting the wrong answers.

That’s what we have been facing in Afghanistan.

Rather than asking the correct question — why are we fighting in the south Asian country? — we seek the elusive winning strategy: What do we need to do to win what is, plainly, an unwinnable war?

The uproar over the comments made by Gen. Stanley McChrystal and his staff to Michael Hastings of Rolling Stone magazine, comments that led to his ouster as commander of U.S. and NATO troops in Afghanistan, focused on the general’s insubordination, his dismissive attitude toward civilian leaders and the frat-boy environment the general appears to have encouraged. These were legitimate concerns, especially given the need to ensure civilian control of the military.

Gen. McChrystal resigned — or was forced to — and is expected to be replaced by Gen. David Petraeus, his boss and the chief architect of the counterinsurgency philosophy that is governing our war strategy. As Roger Daltry sang, “meet the new boss, same as the old boss.”

President Barack Obama, in choosing Gen. Petraeus, made it clear that he is committed to his failed Afghan policy and is unwilling to ask the right questions about Afghanistan, the war on terror and U.S. war-making power in general.

As The Washington Post put it in its coverage last week, the decision to turn to Gen. Petraeus “allowed the president to keep his war strategy intact” and maintain “crucial (Republican) support for a war that a majority of Americans routinely say is no longer worth fighting.”

The president, in announcing the change, called it “a change in personnel,” but not “in policy.”

But shouldn’t the policy, itself, come under scrutiny? We have been fighting in Afghanistan for nearly nine years with little to show for it. The Taliban, which we forced from power, remains a factor and the government of Hamid Karzai, which we support, is viewed as corrupt and out of touch with the population.

Al Qaeda, which had used Afghanistan as a safe haven in 2001 before the 9/11 attacks, has moved across the border into Pakistan and has organized itself in a number of failed states around the globe, according to numerous press reports.

And yet, we continue to wage this misguided war.

The question is why. The answer, I think, is that the foreign policy establishment has gamed the argument by only asking questions that result in the answers it wants to get and by building its rationale on set of questionable premises designed to elicit its desired result.

Basically, it has built its arguments on statements of value masquerading as statements of fact. It is an argument premised on the notion that Afghanistan’s stability and movement toward democracy are imperative to safeguard Americans in the United States, and that our ability to disrupt terrorist activities and dismantle terrorist cells depends on victory in a counterinsurgency war in Afghanistan.

These premises, however, are debatable; they express opinion and not fact. Before we can argue about the best strategy to employ in Afghanistan, we need to discuss the premises of the arguments made by the Obama administration.

Afghanistan’s stability and movement toward democracy are in our national interests. No doubt, a stable and democratic government will be better for the people of Afghanistan and the region, but are they any more important to our national security than a stable Somalia or a democratic Egypt? Isn’t it likely that the terrorist networks will just flee a suddenly stable Afghanistan for some other failed state, forcing us to chase them and putting us in a position of waging a roving, worldwide war?

Victory in Afghanistan is required to fight terrorism. Given that the United States has broken up several, unrelated terror plots in recent years, it seems evident that our efforts in Afghanistan are, at best, tangential to the fight against terrorism. Just as importantly, al Qaeda no longer calls Afghanistan home; rather, it has moved across the border into Pakistan, a nation we consider an ally. The foreign policy establishment is not questioning these assumptions and remains committed to this nasty war, one that has grown deadlier by the month for American soldiers.

The situation is analogous to the American experience in Vietnam, down to the language used to describe our counterinsurgency strategy, as numerous commentators have pointed out. There is no winning strategy in Afghanistan, but fight we must our leaders say because, well, to not fight is to admit defeat. It is a dangerous tautology, and not only because it has resulted in a growing number of American casualties. Our continued presence in Afghanistan — along with the seemingly forgotten, but no less deadly, misadventure in Iraq — is like a spark to the gasoline of resentment that creates new terrorists.

Like Vietnam, the Afghanistan and Iraq wars are draining the treasury and busting our federal budget, siphoning needed money from domestic aid programs.

It’s time we asked the correct question about Afghanistan: How many lives are we willing to sacrifice to a war we never should have fought?

Email me at grassroots at comcast dot net.

Slashing public payrolls in a recession is like cutting off our collective nose to spite our face

This piece from The Washington Independent offers a clear explanation of the impact that state budget shortfalls are having not only on state-level taxes, but on the national employment picture.

States and towns, because they have to balance their budgets, have been forced into counterproductive binds, where they are left with the choice of raising taxes or firing workers.

Politics being what it is, layoffs tend to win — the consequences be damned. That’s what we are facing here in New Jersey with a budget gutting governor intent on pushing through an ill-conceived and foolish spending cap that might help keep taxes down but will result in problems for both the state and local governments down the road — and for the economy at large — problems not likely to crop up until Chris Christie has left the building.

Teachers already have been laid off, angering parents, and we can bet on cuts in police and fire and other areas.

Christie, of course, is just cleaning up after too many politicians from both parties partied hard and left the state in a shambles. The budget he signed the other day is pretty painful, though it also is filled with one-shot budget savings and gimmicks (we cannot keep avoiding making payments into the pension system) and it is brutally ideological.

He is just doing something that Jon Corzine lacked the will to do as governor and that Barack Obama has failed to do as president — use the state budget crisis to impose his ideological vision.

But that is a tangent. New Jersey is dysfunctional in many ways — too many towns and school districts, too much overlap, too much reliance on tradition and a legacy of inertia in Trenton — but it is not alone on the Island of Misfit Toys. New York, Nevada, California — the list of states that have failed in their fiduciary duties to taxpayers is long and bipartisan. Decisions made at the state level have generally been shortsighted, and the bill has come due.

That said, we have to acknowledge another player in this game: the Bush administration. The increase in aid to states and local governments during the Bush yearswas a little smaller than during the eight years of the Clinton administration, but it represented a much smaller percentage increase and a shrinking percentage of all state revenues. That only compounded the other revenue problems states have been facing.

As Ethan Pollack of the Economic Policy Institute points out in an issue brief, public sector job losses create private sector job losses:

So far local governments have laid off 3,338 public servants for each billion dollars they faced in deficits. Assuming the ratio remains constant, this suggests that local public employment will fall by 155,750 jobs between now and June 2011 and by 66,750 jobs between July 2011 and June 2012. This adds up to an impending 222,500 drop in local public employment between now and June 2012—in other words, over half of the local job losses have yet to hit the economy.

This back-of-the-envelope estimate may understate the total expected job impact: local governments tend to cut the low-hanging fruit first rather than immediately resorting to the politically unpopular and difficult option of publicsector layoffs. This suggests that the ratio of layoffs-to-deficits may increase in the future. For example, a recent report from the American Association of School Administrators estimates that through June 2011 around 275,000 education jobs (75% of which are funded by local governments) will be lost (Ellerson 2010).

This massive job loss will harm far more than the public servants who face unemployment. For one, our communities will be deprived of the vital services they deliver. Schools would see larger class sizes, our homes would be less protected from fire, and our streets would become less safe. This is already happening across the board—according to a survey from the National League of Cities, 71% of cities have instituted hiring freezes and layoffs (McFarland 2010).

These layoffs also ripple through the entire economy. Each 100 public-sector layoffs also leads to 30 private-sector layoffs, mainly due to a loss of incomes and consumer spending that reduces demand for goods and services across the economy. The total employment impact of these public-sector layoffs—including private job losses—would actually be just under 300,000 jobs lost.

While slashing public payroll to get state budgets under control would seem logical, it actually is counterproductive and will lead to greater deficits down the road. The fact remains, we cannot get control of deficits unless we get people back to work (the numbers of longterm unemployed and underemployed are at record levels), which will lead to an increase in tax revenue for all levels of government. And we cannot move our economy into the 21st century without investing in things like education and modern infrastructure.

A massive increase in federal aid to states is an absolute necessity — along with federal transportation and education aid. Without it, our economy is just going to accelerate downward into a Japanese-style stagnation that Paul Krugman has repeatedly warned us about.

Email me at grassroots at comcast dot net.

NBA silly season is getting sillier

http://espn.go.com/videohub/player/embed.swf
An already loaded free-agent class looks to be getting even more overstocked with talent, given reports that all-stars Paul Pierce and Dirk Nowitzki are opting out of their contracts and hitting the market.

Nowitzki would join premiere front-courters Chris Bosh, Carlos Boozer and Amar’e Stoudemire, while Lebron James (the prize of the off-season), Dwayne Wade, Pierce and Joe Johnson make up a serious set of twos and threes. And this does not account for David Lee.

There also are former stars — Allen Iverson, Shaquille O’Neal, Jermaine O’Neal — and some former high draft choices like Adam Morrison and Ray Felton that could help some teams. But the big eight will be the focus.

***

Ian Thomsen offers a bizarre scenario that he says is the Knicks’ actual blueprint for landing James:

A league source with understanding of New York’s plans told SI.com that the Knicks will recruit the Cavaliers’ two-time MVP with a grandiose vision of surrounding him with Hawks shooting guard Joe Johnson as well as an elite power forward — Chris Bosh of the Raptors or Amar’e Stoudemire of the Suns — to form a starring trio capable of contending for championships for years to come.

The idea would be to take the Knicks’ cap space and divide it by three, which would require the players to sign for less than they could get as max players. The draw is supposed to be the chance to bring New York a title and create history.

Is that something that might happen? Seems a long shot. More importantly, does it make sense? James obviously is a dominant force, while Bosh and Johnson are legitimate second bananas. The problem, however, is that the team would lack power in the paint (ask the Celtics what happens when you’re undermanned in the middle) and a point guard.

The team also would lack something that David Lee, the odd man out, brings — a lunch-pail ethos. The Celtics’ success in recent years had as much to do with strong, scrappy secondary players as with the big three plus Rondo. This Knicks team would lack that.

In any case, I suspect this is nothing more than a pipe dream.

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Economists’ notebook

I’m going to try to offer these tidbits somewhat regularly — snapshots of how the conventional wisdom of the day on the economy is likely to lengthen the current recession, if not drive us into a real and ugly depression.

Here are some of today’s posts on the economy from some liberal economists:

  • Dean Baker offers some sanity on our fealty to the IMF here. (In general, his blog on economic reporting, Beat the Press, offers a necessary antedote to the nonsense generally offered.)
  • Paul Krugman reminds us that austerity measures during a recession are foolish and counterproductive — as in Ireland.
  • Simon Johnson throws cold water on the euphoria surrounding financial reform.

Send me your reading suggestions in the comments.

Email me at grassroots at comcast dot net.