Category: Economy

Crossposted at Daily Kos

THE WEEK IN EDITORIAL CARTOONS

This weekly diary takes a look at the past week’s important news stories from the perspective of our leading editorial cartoonists (including a few foreign ones) with analysis and commentary added in by me.

When evaluating a cartoon, ask yourself these questions:

1. Does a cartoon add to my existing knowledge base and help crystallize my thinking about the issue depicted?

2. Does the cartoonist have any obvious biases that distort reality?

3. Is the cartoonist reflecting prevailing public opinion or trying to shape it?

The answers will help determine the effectiveness of the cartoonist’s message.

:: ::

Steve Sack, Comics.com

  A strategist at the Deutsche Bank had something interesting to say last week regarding the economic crisis in southern Europe.

 “The problems currently faced by peripheral Europe could be a dress rehearsal for what the U.S. and U.K. may face further down the road,” Jim Reid, a strategist at Deutsche Bank in London, wrote in a research note today.

 It seems impossible that what is going on in Greece has anything to do with America. After all, Greece has defaulted on its debts so often over the last two centuries that you could almost set your watch to it. It was always contained in the past because Greece’s economy is so small, so why would this time be different this time?

 And yet, it isn’t contained this time. It is spreading and no one knows how far it might go.

While the “news” media focuses on the Tea Party mad hatters and their awesome political clout, there’s another potential financial meltdown in the pipeline.

This report from Baseline Scenario will possibly get move coverage in the coming week, as the markets react. In the meantime I just thought I’d post a quick Essay about it, as a kind of “Heads Up”.  

Lazard Ltd, formerly known as Lazard Frères, gave away the “store” in bonuses to its employees to the tune of $565,000 per person. Lazard, unlike Goldman “Sacks” and other Wall St. investment agencies, did not receive any bail out money.

The firm doled out $616 million in compensation and benefits to about 2,300 employees last quarter, or more than triple the amount handed out in the same period in 2008. It was a consequence, Lazard said, of a decision to pay more bonuses in cash and accelerate some deferred cash awards from a prior year. But so great was the firm’s generosity that compensation costs overwhelmed quarterly revenues and resulted in a net loss of about $55 million for the fourth quarter. The charges also almost wiped out full-year profits.

(emphasis mine)

  The president had some bold words for the American public earlier this week. He said things that some people didn’t want to hear. He talked about responsibility and sacrifices.

“We simply cannot continue to spend as if deficits don’t have consequences, as if waste doesn’t matter, as if the hard-earned tax dollars of the American people can be treated like Monopoly money, as if we can ignore this challenge for another generation.

 “. . . It’s time to save what we can, spend what we must and live within our means once again.”

– President Obama, 2010

 After saying these bold words he then presented Congress with a plan for the largest deficit in American history. I guess politicians are immune from irony.

During the State of the Union address, President Obama noted what a slew of other previous Presidents have noted–that the United States of America needs to start exporting goods again.  Few people can disagree with a statement like this, but what Obama, nor any of his predecessors have ever discovered is precisely what one would need to trade with other countries and in what form this new invention would take.  If were wise enough to know, I’d probably be well on my way to being a very wealthy man, so I don’t underestimate the challenge in front of us.  However, though I believe that the capitalist system caters more to the selfish side of us more than the altruistic one, with selfishness does come innovation for the sake of maximum material gain, and in that regard, perhaps our basest instincts might come to everyone’s aid, at least for a time.

Careworn phrases like “good old fashioned American ingenuity” have been utilized over and over again for at least a century, insinuating strongly that there was no problem beyond our grasp which would not eventually render a solution.  And, honestly, I don’t think that this mode of thought nor of rhetorical framing has ever really gone away altogether.  But what I do think is that we don’t often look for these signs so much for where they are so much as where we think they ought to be.  Everyone can drive by and see the looming, titanic mass of buildings that house a paper processing plant or a textile mill, but the more subtle evidence of, say, a software design firm is much less visible to our senses and our psyches.  Even though we may be headed towards a purely service-based economy, other developing nations are only now in the process of beginning their industrial phase of growth.  Though our example might be the means by which they set their sights and chart their course, one must also crawl before one walks.  

If we were all more or less on the same page the whole world round regarding economic parity, then exporting commodities would be a much easier task.  Right now we do retain some residual elements of an earlier day, but often our products can’t compete globally because they cost more to produce and thus they cost more to purchase.  I honestly believe that we can be indebted to one of two stances in this instance, but not both.  Either we pay people more in line of a fair wage, granting them adequate benefits— recognizing that this will ensure that many countries can always buy what they need at a cheaper price from another source, or we slash costs to the bone and with them salaries and benefits.  It goes without saying that I would never advocate the second position, but for the future going forward that model might be the only option that makes our products look attractive and compelling to another country or region’s buyer, based on the current state of affairs as they exist today.

Speaking specifically about food, for example, I note that our own cultural attitudes are often to blame for much of the disparity.  The more affluent among us can afford to be socially conscious by means of pocketbook and pay two times as much for products at a Whole Foods or a locally-grown produce Farmer’s Market.  The poorest, of course, simply aren’t afforded this option.  Americans might cut corners or scrimp to buy a wide screen television or to save up to take a vacation, but never towards food.  Food is always supposed to be readily available, unquestionably cheap, and supremely varied.  Organic food is a kind of innovation of sorts, since though its stated purpose is to use older methods of cultivation, it still combines elements of more modern technological strategies with the tried-and-true methods of a different time.  Though it would never willfully adopt this label, organic food is itself a hybrid concept—one that seeks the middle ground between old and new.  

These, of course, are previously established channels and instances.  As for what product or products would find favor among the consumers of the globe, one assumes upon first thought that the most likely innovation would come in the form of some new technological breakthrough, one perhaps tied closely to the computer or the internet.  However, like organic food, perhaps it would be best to seek for something with a foot in old ways and a foot in newer formulations.  The most enterprising soul would be wise to recognize that products can be designed purely with the intention of always having a reliably steady stream of buyers and demand, or that they can be modified in the hopes of both making money and pulling in less developed countries and regions more economically in line with ours.  Straddling the gap between the way it has always been and they way it needs to be is partially why we are at the impasse in which we find ourselves.  While I do believe that the phrase “ethical capitalism” is a complete oxymoron, I do also recognize that if we are left with a system unable to be discarded for quite some time, it would be much easier if we limited as many disparities and points of difference between people as we could, since then it would be able for us to better address the remaining and still quite numerous problems left over.  

We are still in the middle of a shift between an industrial economy and an information-based one, but at times our benchmarks and guideposts are indebted to a by-gone epoch.  Nostalgia is strong and so is the resistance to the way things were always supposed to be.  For instance, I grew up in Birmingham, Alabama, a city which was forced to completely reinvent itself after the collapse of its native steel industry in the 1970’s.  In so doing, it embraced banking and a world-class health care center based around a university, both of which are the two largest employers in the metro area.  We might be wise to emulate their example, which is far from the only instance that a city teetered on a knife’s edge between survival and disaster and managed to righted itself.

It is a short-sighted, short-term gain over long-term ultimate resolution means of thinking that got us into our current mess.  American must learn that delayed gratification provides temporarily discomfort but eventual, eternal satisfaction.  Greed drives humans to go for the quick cash-in and the gravy train, instead of a more modest, but still very satisfying profit.  I don’t ascribe to a theory of American exceptionalism because I am too aware of the times at which we fall short, though I also recognize that we are far from the only country, society, or culture which has a tendency to opt for the quick fix rather than engaging in the soul-searching and introspection which leads towards true resolution.  Lasting success is based on hard work and research, not the accidental score.  

Neither do I count myself among the numbers of those who adopt a cynical tact towards American identity and greater purpose that seeks fault first and rarely gives room for success.  Somewhere between those who believe that our best days are yet to come and those who assert that we are soon going the way of the UK into second-tier country status is something close to the reality of the situation.  Still, what we require right now is a new kind of skill set, one willing to work with existing trends, rather than fight them, build up native industry without seeking salvation in the form of a foreign company with an open checkbook, pay a bit more than usual for household staples with the understanding that increased cost doesn’t always mean money wasted, and recognize that in a truly fair world, it shouldn’t matter who is number 1 or number 500.  If money is what makes the world go round, we can’t begin to get any other unfair construct in check until we ensure that monetary policy levels the playing field.  Real equality does not trickle-down and it never will.  

Crossposted at Daily Kos

THE WEEK IN EDITORIAL CARTOONS

This weekly diary takes a look at the past week’s important news stories from the perspective of our leading editorial cartoonists (including a few foreign ones) with analysis and commentary added in by me.

When evaluating a cartoon, ask yourself these questions:

1. Does a cartoon add to my existing knowledge base and help crystallize my thinking about the issue depicted?

2. Does the cartoonist have any obvious biases that distort reality?

3. Is the cartoonist reflecting prevailing public opinion or trying to shape it?

The answers will help determine the effectiveness of the cartoonist’s message.

:: ::

John Darkow, Columbia Daily Tribune, Buy this cartoon

Now that the “Plouffe You, You Dirty Effing Bedwetter Brigade”  has taken over the public communications again for the Obama administration, we are treated to the Trial Balloon of the State of the Union address, which says the President wants a 3 year spending freeze which would exempt the Pentagon, Veterans affairs, and Homeland Security.  Of course, the senior Administration official spoke anonymously.

link:

http://www.huffingtonpost.com/…

I don’t think this is a good idea.

The circular firing squad over the defeat of Martha Coakley and what this means for the Democratic Party and Health Care Reform got underway a couple days ago.  I’ve said my bit, and have nothing further to add, but I’d rather address the potential challenges facing reform aside from the loss of a seemingly filibuster-proof majority.  It is now absolutely imperative we push forward and bring a bill to President Obama’s desk.  Our backs may be against the wall, but perhaps it will take abject panic and fear to rouse our complacent, weak-kneed Democratic legislators towards the goal.  If it takes the shock and dismay of a humiliating defeat to break the logjam, then so be it.  I’m not concerned with speculating as to how we got here; I am instead consumed with what we learned from it and how we will use this tough lesson to think of others and their needs rather than ourselves.  

What I have noticed in my own struggles to obtain low-income health insurance is how class and race ensure that government subsidized plans are underfunded and often dysfunctional, but money (or the lack of it) seems to be the most powerful determinant of all.  What many have noted is that basic selfishness is what threatens to derail any efforts towards changing the existing system—namely that people who have always had sufficient coverage do not understand the limitations faced by those who do not.  We can call that privilege if we wish, but that term has always seemed accusatory to no good end to me, and my intent is not to chastise anyone but to make many aware of the challenges in front of us that never get much in the way of attention.  In my own life, I can say that I have now seen how the other half lives for the first time ever, and I noted that they live lives severely impeded by the tremendous limitations and senseless complications of the existing system.

I have been unemployed or at least severely underemployed for several months.  As a result, I had no choice but to file for government assistance.  When I was finally granted food stamps I signed up as well for a local DC funded health insurance plan.  What I have discovered in the process is that since the Recession hit, social service agencies in DC have been swamped by new applications for every existing option currently offered.  According to one worker with whom I spoke, claims have tripled since the bottom began to fall out of the economy.  The system was barely able to manage the number of filings in more stable times, and now it has in large part ground to a halt if not slowed to a trickle.  New claims are supposed to be processed in no more then 30 days from approval, and I was forced to make several time-consuming, additional calls to the proper department to even get the coverage activated.  Those without the time or without the persistence likely will be granted nothing at all and this simply should not happen.  

My great point is that without the infrastructure in place, it doesn’t matter how many people to whom we grant coverage.  Ensuring that everyone can get their teeth cleaned, fillings filled, broken bones set, flu-like symptoms properly treated, diabetes regulated, or depression adequately under control is the ultimate goal, but we must also be sure to build a sufficient number of clinics, medical centers, doctor’s offices, dental hygiene practices, well-stocked pharmacies and all the rest.  They must be built in proper proportion to need and since humankind has never been able to curtail its zeal for making money at the expense of the health of the financial system, we need to devise strategies to build these things for both good times and bad.

In DC, the low-income, government-funded system forces the poor and/or disabled to a handful of centers scattered across the District itself.  Visiting a private doctor or specialist is not an option, since coverage is only granted to those who use these designated centers.  Likewise, pharmacies and medication dispensation function under the same parameters.  Using Walgreens, CVS, Rite Aid, or other commercial medication fillers is not allowed under the plan.  Though there are a score of specific pharmacies which take the DC plan, in my case, there is only one pharmacy in the entire District that fills psychiatric medication, and for me it is a 35 minute trip, one-way via public transportation and then by foot.  The pharmacy itself is attached to a Mental Health services clinic which is the sole site whereby psychiatric care is provided for a city of roughly 600,000 people.

Without enough workers to process claims, grant coverage, manage medical records, or attend to even the most basic of needs the system is essentially worthless or at least incredibly inefficient.  Without enough revenue allocated by governments from taxation or other means, it doesn’t matter how snazzy or up-to-date is any system designed to speed up or modernize the system.  Window dressing is window dressing.  Without the money to properly stock a pharmacy, medications will be obtained on a priority system and as such, meds that are rarely prescribed or are very expensive will rarely be on hand when needed.  For example, one of my medications, Parnate, is an MAOI inhibitor.  Parnate is a very powerful anti-depressant that is infrequently prescribed because with it comes potentially dangerous, even deadly side effects if I do not take care to abstain from eating certain foods.  As you might expect, it is not one of the more common prescriptions, but it is essential to my lasting health and quality of life.  A commercial pharmacy usually has it in stock, or if it does not, it can be quickly ordered or is certainly in stock at some other store in the immediate area.  With the government-subsidized pharmacy I must use, if that particular drug is available at all it is due purely to chance and luck, and if it needs to be ordered, it may be a week or more before they have it in stock.      

Regarding visits with a GP, specialist, or other specific health practitioner, some clinics and centers accept walk-ins or schedule appointments within a reasonable time frame.  Some do not.  For those who need surgical procedures or more invasive treatment, one might be expected to wait months.  When I still lived in Alabama, there was approximately one Medicaid-accepting clinic for the entire state that performed the procedure, and as such when it came time for me to have a very routine, non-invasive treatment, I was booked four whole months in advance.  In more affluent, usually blue cities and states, the wait time is often less, but it can still be a bit on the lengthy side.  As for me, I found to my utter dismay that my coverage was terminated before the procedure could be even performed after the clinic filed and billed Medicaid for the cost of the preliminary screening.  Someone must have realized that to save cost I was not what they deemed a “high-priority” need and thus I could be safely removed from the rolls to save money in what was a system already in danger of being completely depleted of funds.    

An important distinction needs to be drawn here.  The DC-based coverage I have been talking about is different from Medicaid or, for that matter, Medicare.  This coverage augments or seeks to provide coverage to those who either have Medicaid/Medicare or cannot get approved for it.  This is why the rules, parameters, and hoops to jump through are more severe.  Medicaid usually allows a person to pursue more orthodox means of seeking treatment.  Though some medical practitioners do not accept it because it usually pays out less than a gold standard coverage plan through a private insurer, many do.  Again, money is a big factor at play.  If Medicaid were capable of paying out at a sufficient rate, everyone would take it.  If it wasn’t at times forced to pay out much later than a private carrier or even being forced to issue IOU’s when monetary shortfalls and partisan bickering delayed enactment of a satisfactory state budget, then it certainly would be on par with usually employer-based coverage.

Yet, it is very disingenuous at best for those who oppose health care reform to stubbornly dig in their heels and express haughty indignation that they are NOT going to have “the government” take away their right to choose their doctor.  The only way this would ever happen for most is if they lost their insurance altogether, lost all their personal savings, and lost the ability to come up with the money to see a well-compensated physician and/or specialist.  Their worst-case-scenarios and numerous reservations are true only for those living in abject poverty, or at or below the poverty line.  The wealthier among us have any number of lifelines, be they family, co-workers, friends, fellow members of a particular group or club, or other sufficient means.  Those at the bottom have none of this upon which to rely.  Friends, family, and others are just as impoverished and less fortunate as they are, and they have no choice but to take and use what they can get.  And taking what they can get means dealing with a system that is convoluted, needlessly complex, inconvenient at best, and regimented to such an authoritarian degree that even obtaining the minimum often is an exercise in debasement.

If ever we had a need for revolutionary reform and change, now would be it.  Decades after a declared War on Poverty, we still have many battles ahead of us.  We haven’t really given this matter anything more than perfunctory attention, and we haven’t really allocated resources of any significant means to this very pertinent cause.  Doing so would require us to understand exactly how fortunate we are to have been granted, by complete luck and chance, the socio-economic status of which we were born.  For some quirk of God, fate, or nature we do not get the right to choose our parents or to choose our upbringing.  But we do have the obligation to see to it that those for whom daily adversity is not an abstraction have the same rights that we frequently take for granted.  I am not seeking to lecture, nor to hector anyone, but rather to strongly emphasize that our continued success as a people, a party, and a movement demands that we seek to assist the poor and the less fortunate.  Our wallets, billfolds, and bank accounts couldn’t open fast enough to provide aid to suffering Haitians.  If only this were possible for our own poverty-stricken citizens, many of whom struggle through conditions not that dissimilar to those we now view through heart-wrenching news reports and graphic photographs.  After all, it might be you someday who faces the disquieting realization that our health care system is designed for the wealthy, by the wealthy, and in so doing realizes just how much you took it for granted.

  Insolvency is no longer just for California. The dreaded word “bankruptcy” is now being whispered in Chicago.

 While it appears unlikely or even impossible for a state to hide out from creditors in Bankruptcy Court, Illinois appears to meet classic definitions of insolvency: Its liabilities far exceed its assets, and it’s not generating enough cash to pay its bills. Private companies in similar circumstances often shut down or file for bankruptcy protection.

  “I would describe bankruptcy as the inability to pay one’s bills,” says Jim Nowlan, senior fellow at the University of Illinois’ Institute of Government and Public Affairs. “We’re close to de facto bankruptcy, if not de jure bankruptcy.”

 Suppliers in Illinois are not being paid (an average 92 day delay in payment), worker salaries are unreliable, and the University of Illinois may not be able to make payroll this spring.