On the Contrary

We really are at a crossroad and the issues that we face will require completely new thinking.  Although our President understands this concept, he has surround himself with experts in the old thinking and this worries me greatly.  Here are some cogent examples:

• Afghanistan cannot be solved by applying the lessons from Iraq.  In fact it is possible, that Afghanistan does not need to be solved at all, but this will require entirely new thinking about what is possible and whether it is worth the cost.
• We are in a recession approaching a possible depression and the experts have told us that we need to stimulate the economy with spending and to err on the over spending side which is the overwhelming lesson from history.  What did we do?  We loaded up the stimulus package with questionable tax cuts and were skimpy on the infrastructure spending (Thanks Republicans) which may make it ineffective.  Why is that?
• We all agree that the crisis is being caused by the housing/mortgage bubble.  The issue is to stabilize prices but is complicated by the way the loans were broken up in securitized debt instruments.  President Obama has offered a package that deals with the tip of the iceberg, but it needs to go deeper and allow for bankruptcy judges to modify loan agreements and principle needs to be re-evaluated.  Once again we are up against small thinkers in Congress.  Why are we afraid to be bold?
• The banking crisis is very complicated as are the proposed solutions (insurance, more preferred stock, nationalization).  The essence of this crisis is that banks hold more liabilities than they do equity, and therefore have no ability to lend.  Many of the solutions being offered are overly protective of banks and stockholders, and not so protective of taxpayer dollars (Heads the banks win, tails the taxpayer loses).  The solution will require all to pay a dear price with the possibility of some long-term recovery for the taxpayers.  So why aren’t we nationalizing the banks and getting on with it?

I could go on and on including transportation, alternate energy, and health care.  So why when we require bold new thinking are we being so timid which will get us nowhere?  Well part of the answer is the politics.  Are people ready for big changes?  I actually think they are and Washington is way behind the power curve on this one.  The other part of this answer has to do with who we have put in policy positions to make these changes.

The problem has been eloquently presented by Gary S. Vasilash in a piece in AutoFieldGuide.com called “Fire the Generals” sent to me by my good friend Tom Griffin.  Although the article focused on the problem of the failure of car manufactures and specifically their management to understand the new markets, it applies directly to all our great issues that are challenging us today.  The lesson goes something like this:  Using the military analogy, when the type of conflict changes and a new strategy is required, fire the old generals who are still fighting the last war and bring new generals who understand the new conditions and their new adversary.  Our Iraq strategy change followed this prescription.  Mr. Vasilash makes the point that the management that has brought the auto industry to its knees are ill-equipped to manage in a whole new direction.  They are too wedded to the culture they were brought up in.

My own experience tells me that this is a basic truth.  In my 31 years working for the Feds, change was always a buzzword, but by leaving the existing management in place that was comfortable with the old ways of doing business, we always fell back into old patterns of behavior and management.  Real change is terrifying because it is about leaving your comfort zone and it is usually accomplish only in dire circumstances.  The most afraid, apparently, are the Republicans who are sounding more hysterical and shrill as they fight to reestablish their control with old and failed policies.

So both our President and we must follow Mr. Vasilash’s truism.  We must fire the generals.  Whether it is a real war in Afghanistan, or the war to restore our economy, old thinking is no longer viable and we need new leaders who are not wedded to the status quo, who can see options we did not even consider.  For us that means firing both Democrats and especially Republicans who are not ready for bold solutions.  For our President it means getting outside the Washington think tanks and their products to put people in charge who not afraid of destroying the conventional wisdom.  When we see the solutions to the problems I have identified in the start of this piece, we will see if he has really done this or still needs to find new generals.  So far in the stimulus package we thought small.  Remember that we can fire some of the generals in 2010 if they are still resisting change.

Well we are a week into President-Elect Obama term and we have the pundits and the press beating the drum of go slow and be careful.  The conventional wisdom is that we are a center right country.  It is also a flawed concept that will spell disaster if followed.  What is most interesting to me is the idea that somehow the conservative approach to our problems still has any validity whatsoever.  I think everyone is missing the point and what Barack Obama meant by “Change we can believe in”.  It isn’t about center right or center left, or meeting someone’s ideological concepts for government.  It’s about doing things that work, regardless of the political spectrum it represents.

Our biggest problem is that this nation has been controlled by a conservative agenda that is dogmatic and rigid.   The sad thing is that the Democrats bought into it and went along when the markets were sailing.  Since the days of Ronald Reagan we have been on a path for our self-destruction.  What has really happened is that the Republican Party is truly a right wing party and the Democrats became a party of center-right to accommodate and survive.  If you compare what Democrats believed in the 60’s and 70’s with where they are today, they make today’s Democrats look like downright conservatives.  Republicans like to frame Democrats as tax and spend liberals, but Democrats today are not afraid of unleashing the market place where it will work.  They are not afraid of low taxes as long as the tax rate is fair across all segments of our society and it sustains our spending.  They are not afraid of reducing regulations where it makes sense, but some regulation is required.  As for the spending part, the guys who were more interested in balancing the books in the last 16 years were the Democrats (decreasing deficit under Clinton, and ballooning deficit under Bush).  If you look at the market place solutions to health care, education, long term energy policy, or infrastructure upgrades, it has failed miserably.  Time to wake up and smell the coffee and try something different.

But that is what our new and reinvigorate conservatives are going to fight to the death to prevent.  But what I really find interesting is that our pundits are all on yesterday’s script also.  Let’s take the question or more to the point the underlying assumption in the question, just what are you going to cut to pay for all these programs.  What is not being even considered is that for the short term the deficit is going to get bigger because if we don’t do these things, recession could become depression.  Most economists will tell that the world is going to have to go on a deficit spending path for a while to get things rolling again.  Note China has announced a giant infrastructure improvement program to boast their ailing economy.  The pundits have also bought into the idea that you can’t move too fast, that the approach that needs to be taken is center right.  But half measure won’t work and they could make things worse as people become despondent.  You have to wonder when 90% of the public thinks we are on the wrong track, and the assumption among our media is that we need to keep doing what we were doing, just not so vigorously.

We are facing tough times where basic assumptions need to be challenged and we need to try different things.  But our whole information and communications industries need to be brought on to this new way of thinking.  The first big one, of course, is for the short term we are going to grow the deficit.  The second big one is that government spending on real investments in our infrastructure is a real investment in our future.  We can’t wait on investment in alternate energy, and I am sorry so say, forget clean coal.  There isn’t any and any way you cut coal, it produces more carbon dioxide and then if you can capture it, you have to figure out what to do with it.  Forget tax rebates or other popular cash in your pocket schemes where “only you know best what to do with your money”.  If you knew what was best, we wouldn’t be in this crisis now.  We need to get over not controlling how the money is spent in our bailouts.  I’d give more money to the banks and the car industry, but then I would want a major say in how it is used.  We need to drive the train for a change because the guys we having been giving it to have the train off the tracks.

My fear is that this kind of marginal moving slightly to the left thinking is self-defeating.  We need to be in one mode:  progress.  What have been doing doesn’t work so let’s try something else.  It is not the end of the world and if it isn’t better than the old way, change again.  We have been stagnant too long and we have let the naysayers control the world.  We need to take it back.

As I watch political events unfold I have one of two choices, have a stroke or start laughing.  I decided to start laughing.  Could people really believe what they are hearing and saying?  After eight years of Republican cultural wars, could they want more while we ignore the important issues?  Could they really believe that John McCain and Sarah Palin represent change?  Or as Einstein was purported to say, stupid is when you keep doing the same thing over and over and expect a different result.  It is true that people only hear what they want to hear and they filter out all of the stuff that doesn’t jive with their worldview, but this is getting absurd.  Consider the following:

• Sarah Palin thinks that we should go toe-to-toe with Russia over Georgia.  I wonder where she thinks we will get the military force to do that since they are all tied down in Iraq and Afghanistan.  As I pointed out in a recent blog and Fareed Zakaria on his CNN show GPS reinforced, Russia may find that their military adventures will cause them more grief than they are worth in the world of interconnected economies.  Simple-minded military solutions are how we got into Iraq if you remember correctly.
• John McCain, that stalwart maverick who is going to bring real change to Washington, has flip-flopped on all the Republican policies like taxes, immigration, a woman’s right to choose, and has selected a running mate who is farther to the right than Newt Gingrich.  If he is kowtowing to this far right Republican agenda, just who is pulling the strings and how is this any different than George Bush?  Gee John, we hardly recognize you anymore.
• Anybody check out his campaign organization that is full of lobbyists that represent the status quo.  His campaign manager was a lobbyist for Fannie Mae and Freddie Mac.  Anybody see a problem here?  Why do you think these people are so committed to John McCain?  Think there will be jobs for them in his new administration?  Where is the change?
• While John is talking tough on Russia, he does not want a plan to withdraw from Iraq and wants to send more troops to Afghanistan, and oh, don’t forget, cut more taxes.  Just how are we going to pay for all this?
• The lipstick on a pig has been beat to death in the press as being a totally false claim that somehow this was an aspersion on Sarah Palin, but McCain, seeming to forget his old self keeps this lie alive in the media
• The attack on Obama for sex education for kindergartners was so outrageous that it boggles the mind that people would actually believe it.  Yet responsible adults (Republicans) were trying to scare the simple minded in thinking Barack was some kind of sex fiend.
• Palin states that she lives near Russia therefore she understands the Russians.  I am up close and personal with this computer as I type this, so does that make me an expert on the hardware or the software that runs this thing?  People are morons if they are buying this stuff.
• Palin says that she is the frugal governor that stood up to Republicans in her state to balance the state budget and have a surplus.  Does anyone note that this is an oil welfare state where one-third of the economy is oil, and another third is federal spending?  Meanwhile she is doing everything possible to bury an investigation into her that may just show how she abused her power for political gain and used her husband (unelected) to perform state business.  And you thought cronyism was dead when John and Sarah get to rule.  But don’t worry, this will be the right kind of cronyism.
• Just what is John and Sarah’s plan for the economy?  More tax cuts for the wealthy.  My that has worked well so far.  How do you justify tax cuts when the GAO found that two-thirds of the large businesses in the United States don’t pay any taxes.
• With the cutting of taxes just how are you going to invest in energy development when what it will take is a massive investment by our government in R&D.  That is not just “tax credits”, its real investment in the hard science.  But then maybe they don’t believe in hard science since it is obvious that many believe creationism is just as good a theory as evolution.  No wonder we are falling behind the rest of the world in science.
• Then there is the moronic drill, drill, drill, which apparently the Democrats are caving into that by all knowledgeable standards will do nothing to reduce the price of oil and keep us fixated on oil as a solution to our energy problems instead of innovate, innovate, innovate.  Isn’t change mysterious when we do what we have been doing to no avail and yet we call it change?
• Ah, and then there is Iraq and Afghanistan where I have heard no end game plan from John McCain except stay there as long as it takes.  I guess it will take us going broke and then maybe will we see the futility to that approach.

So just what “change” do these two bring to the table?  None.  It is absolute travesty when people say they are suffering, but these two will reform Washington and bring back old time values (read conservative values).  But the old times are gone and with over 80% saying we are on the wrong track, how in the world can they say these two represent anything but traveling in the same direction only faster?  Think about it.  These are the same folks who voted for George Bush in 2000, and 2004, and put most of the derelict Republicans into office, but once again they are going to exercise their good judgment and vote for “more of the same” McCain.  The world really is full of stupid people.  But honestly, should we be surprised?  Half the marriages in this country end in divorce.  That says something about the nation’s judgment.  I hope they wake up soon.  They are destroying my country with their ignorance.