Year: 2018

The indictment.  Turns out, while the hacking may have been done by some 400-pound guy sitting on his bed (this indictment doesn’t deal with the hacking), that’s looking increasingly less likely.

We’ve been attacked.  Our democracy is still very much under attack.

And our president — and the overwhelming majority of Republicans who enable him — are doing nothing about it.

(The “more than $1 million a month” the Russians are now said to have been spending on this was likely much more.  But even if not, $1 million buys the equivalent of perhaps $4 million of talent and labor in Russia, where wages are lower.  For perspective, the budget of the entire DNC, net of fundraising costs, was not much more than $4 million a month last year.  Injecting even a little foreign money into our political system — in cash or “in kind” — is strictly illegal.  But this?  This is the cyber equivalent of an aircraft-carrier-sized sneak attack.)

A review of the political thriller I told you about last February (The People’s House), by the chair of the Ohio Democratic Party who used to work in St. Petersburg with a young Vladimir Putin, whose sequel (The Wingman) comes out Monday.

The only thing I didn’t like about David Pepper’s THE PEOPLE’S HOUSE is that it ended.  And – spoiler alert – justice had not entirely been done.  Really?  This made me crazy.  Jack would let this happen?  Jack Sharpe? I was sure he wasn’t finished.  How could he be?!  Well, thankfully, with THE WINGMAN, we find out he was not.

Why Is It So Hard For Democracy To Deal With Inequality.  Thomas Edsall makes the case that both political parties have abandoned the working class (hence the appeal of Bernie and Trump).  But I don’t buy it.

Bernie was seen as a populist, but Hillary’s policy positions were nearly the same — just (her supporters would argue) a little more fiscally and politically realistic.  (E.g.: debt-free college rather than entirely-free college.)

Many Democratic funders and leaders are rich elitists, just as Roosevelt was.  But we fight for a higher minimum wage, universal health care, debt-free college, more generous overtime rules, worker safety regulations, the right to organize, consumer protections . . . and higher tax rates on the uber-wealthy, preserving the estate tax.

Which I suppose is one more reason to highlight the argument of these two staunch independents, Jonathan Rauch and Benjamin Wittes — “the article we never thought we’d write” — Boycott The Republican Party. “If conservatives want to save the GOP from itself, they need to vote mindlessly and mechanically against its nominees.” 

. . . We’re suggesting that in today’s situation, people should vote a straight Democratic ticket even if they are not partisan, and despite their policy views. They should vote against Republicans in a spirit that is, if you will, prepartisan and prepolitical. Their attitude should be: The rule of law is a threshold value in American politics, and a party that endangers this value disqualifies itself, period. In other words, under certain peculiar and deeply regrettable circumstances, sophisticated, independent-minded voters need to act as if they were dumb-ass partisans. . . .

Florida Has A Gun Problem, And Governor Rick Scott Is To Blame: “In 2014, the NRA’s Political Victory Fund (NRA-PVF) praised Scott, stating, ‘Rick has signed more pro-gun bills into law in one term than any other governor in Florida history.'”  In Florida, you can buy a near military grade assault weapon — with no waiting period! — before you are legally old enough to buy a beer.

(A well regulated Militia, being necessary to the security of a free State, the right of the people to keep and bear Arms, shall not be infringed.  So how about we have a militia — call it “the National Guard” — and anyone who serves has the right to keep and bear arms?  Others, who like to hunt or target shoot, absolutely get to do so, but with sensible gun safety regulations?  Surely if the Militia is meant to be well regulated, the general population can be subject to sensible regulation as well?)

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I’m sure you saw at least snippets of the testimony from the Republican Director of National Intelligence.

We are under attack.

We are not fighting back.

Putin is winning.

Trump — and the Republicans who enable him (virtually all of them) — are allowing it.

Would Reagan have allowed it?  Eisenhower?  Nixon?  Ford?  Romney?  Either Roosevelt?  Lincoln?  McCain?  Either Bush?

Rumblings that Mike Pence may be working to try to expel transgender troops. If true — hopefully not — then this Stars & Stripes op-ed by retired Rear Admiral John D. Hutson, former Judge Advocate General of the Navy, might be worth his reading.

Have you read Michael Lewis’s take on Trump?  His visit with Steve Bannon, watching the State of the Union.  His visit with Walter Shaub, who resigned as head of the Office of Government Ethics. (“I thought, I don’t want to be window dressing for corruption.”)  Riveting, as Lewis’s stuff always is.

And now . . . (thanks, Mel!) . . .

A rabbi was walking down the street when, suddenly, a strong gust of wind blew his keepa off his head. The rabbi ran after his hat but the wind was so strong it kept blowing his hat farther and farther away. He just couldn’t catch up with it.

A young non-Jewish boy, witnessing this event and being more fit than the rabbi, ran after the hat and caught it. The young boy handed the hat over to the rabbi. The rabbi was so pleased and grateful that he gave the young man $20, put his hand on the boy’s head and blessed him.

The young man was very excited about both the tip and the blessing.

The young man decided to take his new found wealth to the racetrack.

He bet the entire $20 on the first race he could.

After the races, the young man returned home and recounted his very exciting day at the races to his father.

“I arrived at the fifth race,” said the young man. “I looked at the racing program and saw that a horse by the name of ‘Top Hat’ was
running.  The odds on this horse were 100-to-1, but after saving the rabbi’s hat, and having received $20 and the rabbi’s blessing, I thought this was a message from God. So, I bet the entire $20 on Top Hat, even though he had no chance of winning, but to my amazement, the horse won.”

“You must have made a fortune,” said the father.

“Well yes, $2,000.  But wait, it gets better,” replied the son. “In the following race, a horse by the name of ‘Stetson’ was running. The odds on this horse were 30 to 1. ‘Stetson’ being some kind of hat and again thinking of the rabbi’s blessing and his hat, I decided to bet all my winnings on this horse.”

“What happened?” asked the excited father. ”

“Stetson’ came in like a rocket.  Now I had $60,000!”

“Are you telling me you made all this money?” asked his excited father.

“No,” said the son. “I lost it all on the next race.  There was a horse in this race named ‘Chateau,’ which is French for hat. So I decided to bet all the money on ‘Chateau,’ but the horse broke down and came in last.”

“Hat in French is “Chapeau” not “Chateau” you moron,” said the father. “You lost all of the money because of your ignorance. Tell me, what horse won the race?”

The son answered, “A long shot from Japan named ‘Yamaka’.”

 

Click here.

And look both ways when crossing the street.

(Especially in England, where the cars come from the wrong direction.)

There are a lot of reason to feel hopeful about November.  We’ve been winning.  And even though the “generic” gap seems to be narrowing (between those who would prefer an unnamed Democrat to an unnamed Republican), there’s reason to think it’s wide.

We’re also making progress on redistricting.  A state like Pennsylvania — which in 2012 gave Democratic Congressional candidates 51% of the votes but Republicans 13 of the 18 seats — is an example.  It’s top court recently struck down the current districts as “clearly, plainly and palpably” unconstitutional.  In November, if we get half the votes, we might get half the seats.  What a concept.

But our Republican friends know all this, and will be doing what they can to hold their lock on power.

Their efforts will take many forms, but the one I think that could be most powerful is simply this — another round of highly publicized $1,000 bonuses in September and October.

Yes, those bonuses may affect only 5% of the workforce, if that.  (The first round went to about 4 million out of 154 million workers — 2.6%.)  But you don’t see a lot of stories headlined: 97.4% Of U.S. Workers Fail To Get Bonuses.

Giving 4 million workers $1,000 costs $4 billion.  It sounds like a lot, but Exxon alone makes that much in 90 days.  It would have been easy for corporate America to give those $1,000 bonuses while Obama was president — but why help Obama?

It will be easy to do it again this Fall, crediting the Republican tax cut and deregulation.

What’s another $4 billion to maintain Republican control of the United States government?  The Koch brothers alone are worth $96 billion.

What the Republicans running in 2018 won’t remind you is that things were headed in the right direction long before Republicans got this lock on power.  Obama handed Trump a string of 75 consecutive monthly gains in job growth . . . a 4.7% unemployment rate . . . the beginnings of wage growth . . . a Debt finally shrinking again relative to the economy as a whole . . . and record corporate profits.

They won’t remind you that, thanks to their massively irresponsible tax cut (Reagan budget director David Stockman’s characterization), the National Debt is now again growing faster than the economy as a whole.

They won’t remind you that they are borrowing an extra $1.5 trillion over ten years — in your name — not to put Americans to work at good jobs rebuilding our crumbling infrastructure but to hand out tax cuts.

And they surely won’t remind you that most of that money is going to those at the very top, including real estate developers like Trump.

Never mind that!  YOU get $930! and YOU get $930! and YOU get $930! as I’ve written before.

Or in this case: YOU get $1,000!  And YOU get $1,000!

What I think we need to do to preempt this October surprise is to mock it relentlessly — starting now.

Predict — loudly — that the same businesses that showered millions of workers with $1,000 bonuses — for a total equal to roughly 90 days of Exxon’s profits — will doubtless be showering twice as many workers (which is to say 5% of the workforce this time) with $2,000 bonuses — all of which will still cost corporate America just $16 billion . . . which sounds like a lot, but the Koch brothers alone are worth six times that much.

So the two things to do if you’re among the lucky few who do get those $2,000 bonuses are:

(1) Take them!  You’ve earned them!

(2) Vote Democrat.

Because it’s the Democrats, not the Republicans, who fight to get you affordable health care and a higher minimum wage; the Democrats, not the Republicans, who fight for working families and consumer protections.  The Democrats who gave us Social Security and Medicare and the social safety net that Republicans have fought every step of the way.

Expose the ruse over and over, week after week, long before those $2,000 bonuses are even announced, so people expect corporate America to try to keep the government in a Republican headlock with those headlines.  When the bonuses materialize, voters — who are not dumb — will be glad to get them (as we all should be glad they did), but see them for what they are.

And if they’re just $1,000 again instead of $2,000? How cheap and insulting is that?

Make no mistake: I hope corporations give their workers raises and bonuses, just as they could easily have afforded to do in the last years of the Obama administration.  I just don’t want anyone fooled — if they do it this summer or fall — as to why they’re doing it.

One way to think about the market: were you more or less confident in the country’s prospects and prosperity when Obama was President than you are now?

> If you were more confident then — when the Debt was finally again shrinking relative to the economy as a whole — why should the Dow be much higher now?  (The Dow was 18,000 or so the day of Trump’s surprise win.)

> If you are more now than then — with the tax cuts, deregulation, and giant deficit juicing the economy, but departed Trump advisor Omarosa Manigault Newman opining “it’s not going to be okay” — that could justify at least part of last night’s 24,000 or so close.

I didn’t think the market was undervalued then at 18,000.  And I doubt it’s a steal here at 24,000.  Though what do I know.

Monday, I hope to post “Pre-empting the October Surprise.”  Still working on that one.

But for now, three links:

Bruce Bartlett tweeted this link to a Ben Carson profile, with the comment: “I can’t think of a single Trump cabinet secretary who isn’t the worst person ever to hold that position in departmental history.”  Bartlett, a Republican, served in the Reagan and Bush 41 administrations.  Housing Secretary Carson, this profile makes clear, is one of the least-worst of the bunch.

Here, from the kind of global consultancy CEOs pay huge bucks to hear from, are Six Trends for 2018.

Following up on yesterday’s book-plug, watch this 45-second trailer.  More compelling than the blurb I posted.

Have a great week-end!

Does this sound like your cup of literary tea?

It all started with a simple idea, the idea of a City on the Heights. But as the competing visions of an orphaned teenager from Mosul, an Islamic State commander and a well-meaning American Jew come together, the result is a dangerous and combustible mix. In the end, the future of the City – and of the entire Middle East – hinges on the wisdom and dedication of a young battle-scarred woman.

If so, let me know what you think of City on the Heights, currently the 3,925,075th best-selling book on Amazon, recently self-published by my pal Joseph Cox — either $2.99 or free if you have Kindle Unlimited.  The 11 reader reviews are mostly 5 star and nothing lower than 4.

But maybe the reviewers are all his cousins.  Take a look and write a review of your own.  (And watch this 45-second trailer.  More compelling than the blurb.)

BOREF holders: Here is a running list of WheelTug press releases.  The most recent (yesterday’s): SunExpress Reserves 66 WheelTug Systems.  It brings their total reserved slots to more than a thousand planes at more than 20 airlines.

Well, really.  Don’t we need some?

Scott Pruitt Orders EPA Employees To Stay In Office Over Weekend While It’s Being Fumigated

Satire, from the Onion.

And then — devoid of any political edge — there was one-time aluminum-siding salesman Rodney Dangerfield, 1921-2004, remembered here.  (So ugly when he was born that the doctor slapped his mother.)  “Funny, funny stuff,” as Johnny Carson would have said.  (Thanks, Brian.)

As for the market, it would have been down 50% from November 8, 2016, Trump said last month, if Hillary had been elected.  So it would have been 9,100 (down from 18,200) instead of the 26,400 it was when he made that comment.

“Fifty percent,” he said for emphasis. “Remember that.”

This from a guy who knows something about finance, having bankrupted several companies; yet it’s hard to follow his reasoning.

To the extent Hillary’s tax, regulatory, and economic policy would have been largely in the mold of Obama’s and her husband Bill’s, the stock market might have been expected to do well, not collapse.

Under Bill, the Dow nearly quadrupled over 8 years (despite tax and regulatory policy Trump hates, but that added 23 million jobs and got our National Debt shrinking relative to the economy as a whole).

Under Obama, it more than doubled (tripled, if you measure from March, after the Bush crash bottomed) and added 11 million jobs (millions more, if you net out the millions lost in his first few months of the collapsing economy he inherited). And, again got the Debt shrinking relative to the ec0nomy as a whole.

So what is it about Hillary that leads Trump to believe that, in her first year, the Dow would have fallen by 50%?

Meanwhile, it may be instructive to note that when Bush 43 took office, slashing taxes on the rich, widening inequality, and ballooning the Debt relative to the size of the economy — as the Republicans have just done once more — the market did rise about 40% at its peak.  But this massively irresponsible tax policy led to a crash (the Dow would bottom at 6,500 from its Bush 43 peak of 14,000 or so) and a near global depression.

So:

Will the massively irresponsible Trump/Republican tax policy lead to a similar collapse?

Dunno.

But throwing massive tax cuts — mainly for the wealthy and super-wealthy, like Trump — onto an already low-unemployment fire may not to end well.

It could lead to higher interest rates, which could lead to a terrible cycle of deficits . . .  (when you owe $21 trillion and the cost of borrowing rises 1%, that’s an extra $210 billion a year in interest payments, a little more than we spend on our veterans each year; a 3% rise would add $630 billion) . . . which could drive interest rates higher still.  Ballooning the deficit still more.  We could print money to try to make up the difference, but that can ignite inflation and drive rates up further still.

I don’t think Friday and Monday were likely just minor bumps along an otherwise smooth ride to the moon.  My own market exposure is fairly modest, and a lot of it is in stocks like SPRT, that trades around the value of its cash, and BOREF, which is no better or worse a lottery ticket than it was last week.

For what it’s worth, the friend who told me he margined his stocks by 30% to buy cryptocurrency claims to have listened and to have cashed in, and paid off his margin loans, just in the nick of time.  I hope it’s true.

Hate crimes are apparently up, in part, perhaps, because Klansmen and others — some of them “very fine people” — are encouraged by what they see as a sympathetic president.

The Washington Post recently offered this sad report: “The Confederate flag resurged. The KKK burned a cross. Racial tensions flared in a Southern town.”

But the general trend of hearts and minds, I think, is positive.  Witness this exchange between a mom whose son has just told her he’s gay and a bartender — in Mississippi.

That same president yesterday called Democrats “treasonous” for not clapping when he took credit for good economic news.  Treason is a crime punishable by death, and, obviously, he didn’t literally mean Congressional Democrats should be killed for not applauding him or the good economic news as he delivered his State of the Union Address.  But he is, after all, the President of the United States, and he was, after all, being broadcast live, and there was a time (April 30, 1789 through January 20, 2017) when the president’s words were expected to be generally honest, measured, and dignified.

The economic progress Trump boasts about mainly builds on what Obama did: averting a global depression and handing Trump 75 consecutive months of private-sector job growth, a 4.7% unemployment rate, and a Debt finally shrinking relative to the economy as a whole.  As argued yesterday (YOU get $930! and YOU get $930!), the tax cut he touts is massively ill-advised.

John Grund, one of your fellow readers, offers this wonderfully clear analysis (thank you, John):

Here’s another way to think about the Republican tax bill: Think like an owner.

Sit down quietly and let your mind inventory all that you own as an American. I like to start with the Statue of Liberty. It was a gift from France to the American people; I’m an American person, so that includes me. And the Park Service charges admission, so there’s that.

From there, I like to fly over the country in my mind, surveying all that you and I own. All the beaches and waterways. All the roads and bridges. All the public lands and forests. All the great national landmarks and parks. All the wonderful buildings our fathers and mothers built for us: the libraries and colleges and theaters.

Take your time. It takes time to even touch on how much there is. The public hospitals and clinics. The harbors and canals. The lighthouses and navigation markers. The reservoirs, rivers, lakes and water systems. The radio and television airwaves. The courts and city halls and schools. The warships, guns and warplanes.

And now reflect that corporations are granted a charter by the state (which you and I own, of course) that allows them to do business. And think of corporate taxes as the rent those corporations pay for using all that we own – the roads to deliver their products, the monetary system the underpins commerce, the police to keep their trucks safe, the schools to train their workers, the military to protect it all.

The Republican tax bill cuts the rent you earn on all that property. The corporate tax rate drops  from 35 percent to 21 percent of profits.

Now perhaps you are a gracious and benevolent landlord, and you say you don’t really mind giving your renters a break. You’re feeling generous.

But remember you have a mortgage against all that property, too. It’s the national debt, and you use the rents – the taxes – you receive as owner to pay off that mortgage. And remember that the rents have to pay for upkeep on all that property. Are the roads and bridges in great shape, with plenty of money squirreled away to keep them that way? Or are they in dire need of long-delayed maintenance and restoration?

This is one case where it is right to think like an owner, because that is what you are. Be a calculating landlord when you consider the Republican tax bill.

Isn’t that kinda great?

One could certainly tinker with the implementation.  For example, how about revenue-neutral corporate tax reform?  Adopt the more-globally-competitive 21% were adopted — but pay for it by closing loopholes that most big corporations have been using to pay far less than the nominal 35% rate.

But the gist of John’s essay, I think, is exactly right.

Again, I urge you to watch Reagan budget director David Stockman’s critique of the massively ill-advised tax cut.

And again, note how beyond nuts — how bizarro-world — it is that this tax bill, designed to help the middle class (yeah, right), and that’s gonna cost Trump a fortune, “believe me” (yeah right), includes a special provision for real estate developers like Trump.

I’m all for the much-heralded $1,000 bonuses a few million employees (maybe 5% of American workers?) have gotten from corporate employers . . . perhaps in part to curry favor with the strong man in the White House, perhaps in part to help Republicans hold Congress in the next election, and surely in part because they’d like to do something nice for their valued employees.  That’s great.

And I’m all for the modest but real tax breaks many middle-class Americans will see (if we can afford them; though: can we afford them?).  Bloomberg estimates $930 a year for people in the middle fifth of taxpayers ($60 for people in the bottom fifth).  But don’t you get it?  The motivation here is to help those at the top.  You get $930!  And you get $930!  And you get $930!  And — if I’m in the top 1% — I get $51,140.  Unless I’m in the top tenth of that group — $193,380.  Unless I’m in the top tenth of that group — where Trump and his friend Carl Icahn and his pal Wilbur Ross and his pals Sheldon Adelson and the Mercers and Betsy Devos presumably are.  That number Bloomberg doesn’t even try to estimate, but it would be a lot higher.

When the ultra-rich were taxed at a 90% top federal tax rate (Roosevelt, Truman, Eisenhower), it was too high (though designed to lower our National Debt, relative to the economy as a whole, which it did help do).  And when they were taxed at 70% (Kennedy, Johnson, Nixon, Ford, Carter) it was still too high (though it, too, helped shrink the Debt relative to the economy as a whole).  Even when they were taxed at 50% (Reagan’s first cut), I would argue it may have been too high.

But, with his second cut, Reagan, and then Bush 43, and now Trump have exploded the National Debt — borrowing not to build infrastructure that’s been crumbling for 35 years, but to enrich the already-rich by cutting their taxes to record-low levels.

Criminal.

Well, not literally. But immoral.

And dishonest (Bush told us “by far the vast majority” of his tax cut would go to people “at the bottom”).

And . . . well, tragic.

Only Clinton and Obama managed to turn the deficits around, leaving their successors with economies growing faster than the debt . . . thus shrinking the debt relative to the economy as a whole.

This massively irresponsible Republican tax cut reverses that, once more.  It puts us back over $1 trillion in deficit spending . . . gets the debt growing faster than the economy again, as under Reagan, Bush, and Bush . . . and is sold to the voters as, “Look!  You get $930!  And you get $930!”  (And me?  Don’t bother your pretty little head with that.  If you can’t trust Donald Trump and Mitch McConnell and Paul Ryan and Devin Nunez and Vladimir Putin — Trump trusts him, why shouldn’t we? — whom can you trust?)

Right?