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Week of January 25, 2009 - January 31, 2009

Obama being held captive?


In most countries there are four (or five) centers of power:
1. The executive
2. The legislature
3. The judiciary
4. The military
5. The church

In the US the church has always wielded indirect power, although in the past four decades there has been an unusually close alliance between certain religious sectors and the Republican part. This is atypical for the US.

What I want to focus on is branch that we are taught in civics class doesn't exist: the military. The idea is that the US doesn't have such a fourth branch of government because the military is under "civilian" control. This is a convenient fiction, 99% of the military structure remains in place from one administration to the next. It is the largest recipient of discretionary federal funds, now at 54% of the budget. To ignore its influence is to make a big mistake.

Until the 20th Century the US tended to have a small military and the general sentiment was for America to stay out of foreign entanglements. There were some exceptions with the Monroe Doctrine and the like, but most military expansionism was focused on continental territory.

When leaders wanted to engage in foreign military action they needed to gin up support by creating a sense of outrage in the public. "Remember the Maine" was used to justify the Spanish American war. Wilson used various claims to get support for entering WWI, LBJ invented the Gulf of Tonkin and even FDR had a campaign of assisting England before Pearl Harbor to sway public sentiment. Recent events have followed this pattern.

There has been a subtle change since WWII, however. Once the military was ramped up to the extent that it became a world player it has never gone back to being only reactive. The first to be affected by the rise of the permanent fourth branch of government was Truman. Enough evidence has now come out over the decision to use the A bomb on Japan to show that he was influenced (or manipulated) by the group that had been working on the bomb and the generals who wanted to use it as a way to signal US superiority, especially to the USSR, in the post war period. Truman was the first modern president to be held captive by the military.

I won't recite all the other examples, but it is clear that LBJ and Nixon were also manipulated. Their mishandling of the Vietnam war was directly related to the poor intelligence information and biased advice they were getting.

The responses of both Bushes to events in the Middle East are just the latest in this chain. The fact that Bush II was happy with false intelligence only shows that some people are content to live in their bubble.

We now come to Obama. Even before he was elected he started to make statements that are right out of the permanent military playbook. This includes the need to expand the military and, now, to ramp up attacks in Afghanistan and Pakistan. The statements that are made by his military advisers sound just like those heard from McNamara and his crew during the Vietnam war. These include the idea that we can pacify the local population, by eliminating the insurgents, that the failure of our programs is due to corruption or lack of adherence to our plans by the government leaders and that an increase of troops on the ground will make a difference.

None of these tactics have ever worked in the past. The evidence of history is there for all to see, not just in wars that the US has fought, but elsewhere. The IRA was not conquered, the parties finally realized that a political solution was the only way out. The rebel forces in parts of Africa have been carrying on civil wars for as long as 40 years. The Kurds have been doing so for centuries.

So what can explain Obama's shortsightedness? Is he a war hawk like Bush? Not likely. Is he in a bubble where all he hears are the daily threat assessments? Perhaps. What I claim is that all presidents are captives of the military branch. They wield so much power, have so many "friends" in congress and control so much of the industrial production of the country that a president isn't able to muster enough support to go against their wishes.

How would he do it? Suppose he proposed a sudden pullout of troops, or a radical downsizing in military spending. Would congress pass the enabling legislation? No. Would he be re-elected. Doubtful.

Is there anything Obama can do to dig himself out of the Middle East quagmire? I'm stumped, recent history seems to indicate not. We only leave after we have not only lost, but been throughly humiliated. When a segment of our government is larger than that of all the other industrialized countries combined to think that its doesn't wield power is naive.

If anyone one thinks they have a way to remove the undue influence of the military on US policy, I'd love to hear it and if you think you have a way to "win" in Afghanistan please explain that too.

Can an honest man make a living?



I got three pieces of mail yesterday each of which contained a deceptive offer. At the risk of boring the reader with the details:

1. An offer by a local law firm calling itself "The Tax Adjustment Agency" to file an appeal on my behalf over the amount of my property assessment. In return for filling out a bit of paper which contains little more than my name, address and lot number (which I can do myself for free) they will take 50% of any reduction in taxes I might get in the first year.

2. An offer by the local phone company for a combined rate for phone and internet use, but only for six months and with no indication of what the rate becomes afterwards.

3. A note from my credit card company stating that as they have been taken over by a new bank in the future any standard payment arrangements I may half to pay off an outstanding balance will be replaced by one in which they just deduct the minimum. Furthermore the order of which loans will be paid will be to their benefit, namely lowest interest loans first.

Being clever all of these offers are strictly legal, but still deceptive. They don't inform me of how little they are doing for the money, or my other options, don't state the full details of a contract I'm entering into and depend up the average consumer not to notice the payment changes.

Just one more example. A TV show had a segment about "payday" loans which used to be only offered by loan sharks, but are now a big business. They will lend you $300 for two weeks and they you pay back $345. If you can't pay then they will extend the loan for another $45 etc. It turns out that about 85% of the people who use such loans are repeaters and are "trapped". The attractive young woman from the industries trade association (called "The Community Financial Services Association of America") explained with a perfectly straight face that this service was only intended for those who had a rare, sudden need for some extra cash, in spite of the evidence to the contrary.

I wonder how she lives with herself? Did she plan on becoming a spokesperson for loan sharks when she was growing up?

I'm going to propose a Gresham's Law of work: Bad jobs drive out good ones.

Firms which want to behave ethically are put at a disadvantage compared to those who don't. Of course we understand that outright fraud has an advantage, one only has to look at the success of Enron or Bernie Madoff's Ponzi Scheme, but no one can compete with crime. A man sticking a gun in your face has a very high return on his investment.

A bank which didn't boost its fees by deceptive means, or charge the maximum interest it could get away with wouldn't earn as much as its rivals. Investors would complain about its lack of financial "innovation" and demand a management team that was more like the others. And they would get it too.

Alan Greenspan finally stated that he was mistaken when he thought that firms would remain ethical and prudent enough not to damage their own enterprises, but as a promoter of unbridled competition and lax enforcement what did he expect would happen.

As has been explained many times, one needs a balance of forces. On one side is the force of acquisitiveness which leads people to start up and run enterprises. Then there is the desire for fairness demanded by the public and provided by government acting on their behalf. Finally there is the demands of the workers to fair compensation and working conditions as expressed by collective associations that they establish.

Take away or shorten one leg of the stool and it tips over.

Is there any way to restore a sense of ethics to the business world and to make people fee shame when they cheat for a living? You tell me.

The fact that politicians go before us everyday and lie to our faces about the reasons for the positions they take helps set the tone for what is acceptable in a society, but that's a topic for another day.
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