Politics and Press

DEATH BY FIRE: POLITICS AND TAXES

A fire in Gloucester, Massachusetts last night destroyed an apartment building and a synagogue and killed a 70-year-old disabled man. The fire broke out across the street from the city’s fire station and the initial response was only one fireman at least partially because the department has been understaffed since the city’s voters refused to vote for a tax increase in 2004. Another Gloucester resident died in a fire a year ago when it took 11 minutes to respond because the nearest fire station had been closed for budgetary reasons.

This is not an isolated incident – throughout America voters have opted to reduce the quality of basic services in order to reduce their tax bills. At the same time the federal government has provided huge tax breaks to the wealthy thereby reducing funding for local and statewide services. As governor of Massachusetts Mitt Romney consistently bragged about reducing the cost of services in the state by simply reducing their quality. This allows him to take credit for holding the line on taxes but also the blame for deteriorating services throughout the state.

We are a country of bridges that collapse, schools that don’t provide arts education, libraries with reduced hours, lousy train service, spotty public transportation services, deteriorating medical services, etc. According to the United Nations World population Prospects Report the U.S. ranks 32nd in infant mortality behind virtually all Western democracies as well as Cuba, S. Korea, the Czech Republic, Slovenia, Japan and Singapore. The country ranks 38th in life expectancy behind such countries as Cuba, Chile, Costa Rica, Malta, Martinique and Japan.

For years politicians have promised lower taxes without mentioning the corresponding guarantee of reduced quality of life for the vast majority of Americans. And the American people have been willingly seduced by the promise of lower taxes while ignoring the ugly reality of what shortsighted policies have produced for coming generations. We are literally scared into spending trillions on a senseless war in Iraq yet cannot find the resources to fight fires, repair bridges, provide well rounded education to our young and improve health care for all at home. Shame on us.

US grabs for Canadian water

As November ends, the Canadian dollar (the loony) is worth $1.05 US, the highest value it has reached since Canadian troops overwhelmed Washington in 1812. And there is no end in sight as oil prices continue to rise - Canada’s economic trump card as its immense oil reserves become more and more desirable and profitable - and the US economy continues to fall. Impossible super-low mortgage rates in the US, unknown in Canada, have now sent the housing market down south crashing as rates suddenly doubled, and the war in iraq keeps growing as an economic disaster, as well as a moral and military one. The MacKenzie clan had been expecting the US to counter-attack in an attempt to regain some of the prestige that has been lost to a neighbouring economy that had a currency worth $.62 US cents a couple of years ago that has since risen by more than 40%.
But when the attack came it had an unexpected goal, not a grab for oil, but for water. That in itself is unsurprising as Canada’s massive reserves of fresh water must look extraordinarily tempting to the residents of places like southern California, doomed to be threatened by drought and fire. But it was not the fire departments of Orange County that acted but the Disney corporation, attempting to buck up the spirits of the reeling superpower. In its just released video about the wonders of America - which means the United states in Disneytalk - it included that great US icon, Niagara Falls, but avoided the drab US side and showed Horseshoe Falls, or Canadian Falls as it is also known, in all its thunderous glory. Unfortunately this wonder is entirely on Canadian territory, and the Disneyfolk had to apologize, saying it had used mislabeled archival footage, which the MacKenzie clan took with a large gulp of maple syrup. In any case, the Disney Empire promised to correct this misinformation as soon as it had finished having its desired effect

Arms to the Poor: From Krupp to Bush

The military-industrial complex that Eisenhower warned against is alive and well – even if their products are sometimes shoddy and ineffective. The arms business has become one of America’s great exports as it arms countries like India, Pakistan, Afghanistan and Iraq. These days it is reminiscent of the Krupp family business which discovered that it was possible to sell arms to just about anyone in the 19th century, leading to their selling arms and defenses to both sides during World War I. And of course the company was instrumental in arming the German armies during WW II, making huge amounts of profit and paying little in labor since the government kindly supplied them with slave labor. I suppose it is something of a come down for the family now to be selling coffee grinders and espresso machines.

But not to worry, there are plenty of companies willing and able to take on the challenge of arming the world. And while it can be argued that everyone does it, the United States remains in first place in maintaining its post WW-II leadership in finding ways to arm countries or selected rebels around the world. The rationale for doing this is not always clear and is usually done for transitory reasons, and not infrequently with mixed consequences.

The U.S. government and arms manufacturers armed Iran under the Shah and of course saw those armaments fall into the hands of the revolution. Adding insult to injury, the Reagan administration provided arms to Iran as part of its Iran-Contra policy/scandal. (The income from these sales of weapons to Iran under Reagan were then used to provide arms to the Contras in Nicaragua). At around the same time the U.S. provided arms to Saddam Hussein in an effort to support its war against Iran. More recently the U.S. provided arms support to the forces of Osama bin Laden to fight the Russians in Afghanistan. The list goes on and the positive consequences have mostly fallen to the American companies that are heirs to the Krupp value system – and the politicians whose campaigns are funded by the arms manufacturers. In any case the arms provided to Iran, Saddam Hussein, and bin Laden have all been used against our national interest at one time or another.

Now we have the latest proposed handout to the arms companies. Having totally screwed up Iraq and most of the Gulf region with Bush’s fiasco, we are searching for ways to cut our losses and one way is to bribe Saudi Arabia, Kuwait, Qatar, the United Arab Emirates, Egypt and Bahrain with upwards of $20 billion in sales to this group of gulf states and some $30B of new sales to Israel. All of this is in addition to whatever arms remain in Iraq after a war that is now estimated to cost over a trillion dollars. The hope and the wish seem to be that all these new weapons in the region will keep our Iraq adventure from becoming the beginning of a monstrous disaster in the region. Also that these countries will all work to keep Iran at bay.

One of the clever strategies of the family Krupp was to sell defensive armor to one side and then stronger weapons to the other and then the first side would need even stronger defensive armor, and the cycle would continue. With all of the new weapons around the world it is clear that the U.S. will need to improve its weaponry and defenses and so the Krupp strategy is alive and well and the cycle can continue.

Watching the oil gauge

Crude prices dropped 4% in the hours after Bush announced that US ground forces would counter the Shiite militias and the US Navy would be stationing an additional carrier battle group off Iran (Surging total force numbers way beyond 20K or don’t sailors count?).

Given that the war premium in the oil price could be expected to escalate with the war’s escalation, a price REDUCTION might seem puzzling. Or not. It looks as if the Saudis are flooding the market to limit Tehran’s revenues. Saudi Sunnis want to contain Persian Shiites and destabilize Iran’s domestic politics. Or did the Saudis opened the oil spigot merely as a thank-you gesture for Bush’s tilt towards the Iraqi Sunnis?

Are we hearing the opening economic shots in a regional sectarian war? A war we are supposedly “surging” to forestall?

No Pain, No gain

Our Kiwi correspondent has sent a link to a piece from the Weekly Standard’s website that presents serious criticism of the Bush administration – but from a conservative writer in a flagship magazine of conservative thought. Irwin Seltzer’s piece, “Guns and Butter: How the Bush administration’s fiscal policy has narrowed its options in the realm of foreign policy” is worth a read, but raises some questions. These led to an email to Kiwi that is in the Comments below….

Darfur campaign cuts Sudan money

There is an active effort to put pressure on Sudan over its policies in Darfur which is exemplified by California’s passing laws limiting investment with Sudan’s government.

I have always been concerned that sanctions end up punishing the people who most need help but this effort to reduce investment in Sudan - investment that never finds its way to the people - is worthwhile.
Governor Schwarzenegger of California signed the Darfur Peace and Accountability Act last week; the bill requires the state’s pension funds to sell their investments in companies trading with Sudan. The Governor urged President Bush to follow the same path.

“With a stroke of your pen, you can do far more than any one state to ease the suffering of millions in this war-torn region,” he wrote.

To learn more about how you might influence investment go to this link.