Monday, January 30, 2012

When Republican Politicians Hate Jobs

In the middle of his State of the Union speech on January 24, President Obama noted the remarkable comeback of the American auto industry: “Today, General Motors is back on top as the world’s number one automaker. Chrysler has grown faster in the U.S. than any major car company. Ford is investing billions in U.S. plants and factories. And together, the entire industry added nearly 160,000 jobs.”

The workers and management of GM led the world’s automakers in sales for 77 years, until 2007. But their inability to compete in the global market eventually caught up with Detroit’s Big Three. Then came the first depression of the 21st century, and demand for new cars disappeared.

When GM desperately needed capital in 2008, no private financial institution was able to take on the risk. That’s when the federal government implemented its last bipartisan economic venture. In December, President George Bush announced the Automotive Industry Financing Program, a government rescue of the entire industry with funds from the newly created TARP program.

After Obama became President, he refused to simply bail out GM, but demanded that they proceed with an orderly bankruptcy in 2009. The federal government then invested about $50 billion in GM stock, controlling over 60% of the firm.

The use of taxpayers’ money to save giant American corporations was not popular. In two December 2008 polls, 51% and 61% opposed giving financial help to the auto giants; by March 2009, 76% were against it. But economists, both Republican and Democratic, were very worried about the long-term effects of a crashing auto industry. Bush wrote in his memoir, “Decision Points”: “My economic advisers had warned me that the immediate bankruptcy of the Big Three could cost more than a million jobs, decrease tax revenues by $150 billion, and set back America's GDP by hundreds of billions of dollars.”

Public worries that government funds would be wasted turned out to be wrong. In November 2011 the Treasury Department sold $13.5 billion of GM shares, and now owns about one-third of the corporation. Unless GM stock reaches $55 per share before the government sells the rest of hits holdings (share price is $25 now), the government will take a loss, but a much smaller one than most people thought.

There continues to be considerable argument about whether the bipartisan bailout was necessary to save GM. But the return of GM to #1 in the world, the renewed success of Chrysler and Ford, and the saving of hundreds of thousands of jobs in a time of massive unemployment are certainly positive developments. So why did Speaker of the House John Boehner sit stony-faced when President Obama mentioned that GM was again #1? Why did Senate and House Republicans not applaud the recovery of one of our largest manufacturers and the recent gain in automotive jobs?

Mitt Romney offered one clue in the Republican debate on November 9, when he said, “They gave General Motors to the UAW.” He has repeated this line in subsequent debates.

In the first place, that’s a lie. A trust which funds the health care of retired UAW workers bought 17.5% of GM stock at the same time as the federal government bought 60%. The Canadian government bought 12.5%, but nobody would say that we gave GM to the Canadians. Rather than get some special benefits for participating in saving GM, the UAW agreed not to go on strike over wages in contract talks.

The truth, however, is not important to Romney. He and other Republican politicians have been doing everything in their power to destroy unions. Saving union jobs is worse than saving no jobs.

Another reason that Republican politicians disdain the auto industry bailout is that they appear to oppose using taxpayers’ money to interfere in the free market. But the presidential candidates have fallen all over themselves promoting ways to use taxpayers’ money to help American manufacturers. Romney, Gingrich, and Santorum all advocate setting the corporate tax rate lower than the tax rate for individuals, which means that we taxpayers would be subsidizing the corporate profits of the wealthy. Santorum wants to eliminate all corporate taxes for manufacturing companies, so that we would pay their entire share of funding our public obligations.

Their version of the free market would be no freer than the current version, just tilted in a different way, toward wealthy investors, the 1%.

I suspect the real reason that Boehner couldn’t bring himself to clap for GM, or for 22 months of job creation, or for the falling unemployment rate, is that these achievements might help Obama. That would go against the most important Republican goal for 2012, more important than helping unemployed Americans survive, more important than creating new jobs now – make Obama a one-term President.

The level of official Republican hatred for our President was on display this Sunday, when Republican National Committee chairman Reince Priebus compared President Obama to the man responsible for crashing a cruise ship on the Italian coast, abandoning it and his passengers: “we’re going to talk about our own little Captain Schettino, which is President Obama, who’s abandoning the ship here in the United States.”

Calling our President an incompetent coward, a traitor to his country, is the official Republican Party position. In a land of 139 million jobs, Republican politicians care about only one – his.

Steve Hochstadt
Jacksonville IL
published in the Jacksonville Journal-Courier, January 31, 2012

Monday, January 23, 2012

Do Republican Candidates Like Most Americans?

I did not watch Thursday’s Republican debate as a liberal, an intellectual, a historian. I am all those things. But as I watched TV in my mother’s hospital room, I kept wondering, “What are these men saying to her?” Instead of seeing Republicans or politicians or media stars, I saw four men, some around my age, some younger, talking to Americans, but not to all Americans. I wondered, are they talking to us?

They were certainly talking to “Reagan Democrats”. Whoever this group might be now, the candidates offered love and an opportunity to vote for them. Nothing in particular, though, just the claim that if you liked Reagan, you’ll like us.

All four talked especially to veterans. Romney, Santorum and Gingrich asserted that veterans deserved special access when they leave the service to the most prized goods in our society: jobs, education and housing. Ron Paul was more hesitant; he doesn’t like special treatment for any group. The only veteran on stage made a very different offer – to drastically reduce the need for most of them, by ending foreign wars and foreign bases.

I was struck by how many kinds of Americans were ignored in the debate. Rick Santorum pointed out how the others, and the Republican Party generally, ignored working-class Americans. But if you belong to a union, or believe that workers have the right to be unionized, you would not have been happy on Thursday. Mitt Romney equated saving the 70,000 American jobs at General Motors with giving the company away to the UAW. He characterized the members of the National Labor Relations Board, who enforce the laws which protect workers, as “labor stooges”.

If you are gay, you might as well not have listened to the debate. Gay Americans were not mentioned, except to be permanently excluded from real marriages and real families. The candidates thus stuck with their previous negative statements about civil unions and the rights of domestic partners. None of them contradicted Gingrich’s statement in December to a voter who asked about gay issues: “You should be for Obama.”

If you liked the new national health care legislation, because it would cover the 30 million Americans without health insurance or because it allows young adults to stay on their parents’ policy until age 26, there was nothing for you. Romney carefully sketched a plan that would insure only those who already have insurance. Otherwise all four made it clear that it was wrong to change the way those groups of people are treated in the free market.

If you are black, or believe that racial stereotypes should not be the basis of public policy, then you might have hoped that somebody would distance themselves from Newt Gingrich’s insistence in the previous debate that it was conservative and patriotic of him to single out black food stamp recipients for a special scolding about their work ethic. You might still be upset that the audience hooted at the African American Fox News moderator, Juan Williams, when he asked about what Newt had said. The next day Gingrich went further, saying “the idea of work seemed to Juan Williams to be a strange, distant concept.” Apparently true conservatism means being able to criticize African Americans, without fear of being contradicted.

The Republicans were certainly not talking to the millions of poor Americans, without jobs, without proper housing, without insurance. When Gingrich taunted President Obama as the “food-stamp president”, he was also taunting those Americans who need food stamps to feed themselves and their families. All four promised jobs galore, but when? After they are inaugurated a year from now, then many more months until their policies supposedly take effect. Meanwhile, nothing but condescension for becoming dependent, for not having the proper work ethic, for being unsuccessful. Nothing different than their congressional Republican colleagues, who opposed extending unemployment insurance and continuing the payroll tax cut. Nothing at all but a rosy future.

The four would-be Presidents did talk to the 69 million Americans who voted for Barack Obama. We were told that we picked a man who does not share real American values, who is “taking away the rights of our citizens” (Romney), who is “the most dangerous President of our lifetime” (Gingrich). We are obviously stupid or un-American ourselves.

When you add it all up, it seems as if the Republican presidential candidates were talking to a minority of Americans, telling them they were the only true patriots. The rest of us, poor, gay, black, unionized, believers in science, supporters of a fair tax system, we were disdained. If you are happy that our government protects the voting rights of minorities, the environment we live in, and the safety of our products and jobs and food, if you are proud of the changes in American politics over the past 50 years, then the Republicans are not talking to you. So how will any of them be a President to all Americans?

Steve Hochstadt
Jacksonville IL
published in the Jacksonville Journal-Courier, January 24, 2012

Monday, January 16, 2012

Eat at BJ's

I like to eat at BJ’s. At the counter, old men gather every morning to drink coffee and talk about the weather. The waitresses know my name, what I order, and how I like my hash browns. Sometimes the owner stops by my table to say hello. Their pies are homemade.

Further down the street are all the icons of American fast food, with their familiar signs, impersonal service and boring food. Nobody can beat their prices, because their food is prepared in bulk, frozen solid, shipped around the country in big trucks, and served by kids earning minimum wage. Instead of seeing familiar community faces behind downtown counters, people who know your name and your mother’s, whose kids play ball with your kids, Americans sit in cars, order through loudspeakers, and get chemically enhanced, over-salted machine-made “food”.

People talk a lot about the importance of small business, and then get a burger at McDonald’s and go shopping at Wal-Mart. These ugly big box stores and the fatty food purveyors are often blamed for killing local downtown businesses. But it’s not their fault.

Over the past 40 years, the aggregated choices of American consumers have forced thousands of diners, hardware stores, independent pharmacies, and Mom-and-Pop groceries to close up.

Why? Price has something to do with it, but less than most people think. For 2 fresh eggs done the way I want them, 2 pieces of the kind of toast I like with jelly, hash browns, endless coffee, and a piece of pie, I paid $7.42 at BJ’s. At the local McDonald’s a large coffee with no refill, large fries, and a piece of their formerly frozen pie cost $4.47. They don’t serve bread or eggs, but you can get a thin gristly burger on a squishy roll, and come out a bit ahead.

Or so it seems. But the savings we think we get from these giant corporations are illusory. The website of the Institute for Local Self-Reliance offers an eye-popping list of scientific studies over the past decade to show how big box development actually costs American taxpayers and communities billions of dollars ( The destruction of small businesses by giant chains means reduced property tax revenues. The opening of a new Wal-Mart on Chicago’s west side in 2006 caused about one-fourth of businesses within 4 miles to close, some Loyola University researchers found. Away from big metropolitan areas, big boxes in larger towns cause the loss of businesses in surrounding smaller towns.

Taxpayers often fund the construction of big box stores through tax rebates and provision of infrastructure services. Over the past two decades, communities in the St. Louis region have spent $5 billion to fund the construction of big box stores and shopping malls. But the combination of lost businesses and increased costs for roads and other infrastructure for big box stores can mean that this “commercial development” never pays anything back. In Barnstable, Massachusetts, increased costs to local government were greater than new tax revenues, and fast-food restaurants were the most costly kind of development. Smaller retail stores, in contrast, produced a net plus in tax revenue vs. cost. Because Wal-Mart in California pays 30% less than other retail stores, taxpayers there pay nearly $100 million extra dollars a year to provide various forms of public assistance to Wal-Mart workers, who fall below the poverty line.

In hard times, corporate America has a cold heart. Although their charitable giving may seem impressive because of the size of their firms, small businesses give significantly more to local charities per employee than giant corporations. During the last Depression, American families facing hard times were carried by their local shopowners, their neighbors, sometimes for years. Community solidarity spread the few resources around, so the maximum number of people could survive unprecedented economic hardship. Try getting a meal at Burger King on credit.

We can’t blame politicians, the media, or corporate executives for the decline of American small business. Every time we imagine we’ll save a few cents by driving past our neighbor’s store or restaurant to some big box on the strip, we make a decision about the economic future of our community. We send money out of our communities to distant corporate headquarters. We get inferior service and inferior products. We discourage local entrepreneurs and create more unskilled minimum-wage jobs.

The lesson for all of us is that we do better for ourselves and our communities if we patronize small businesses and use local tax dollars to encourage local entrepreneurs, not big boxes.

Buy local. Eat local. Patronize your neighbors. We’ll have more knowledge and control over what we consume. Our economy and our bodies will be healthier.

In BJ’s or the Three-Legged Dog coffee shop or other local restaurants, I see familiar faces. Instead of convenience and speed, I get friendliness.

So, how about that crazy weather? And Marie, please bring me another piece of your peach pie.

Steve Hochstadt
Jacksonville IL
published in the Jacksonville Journal-Courier, January 17, 2012

Tuesday, January 10, 2012

Who is Rick Santorum?

Rick Santorum has been running for President for a year now, but most Americans don’t know much about him, except that he is a Christian conservative. He put enormous energy into Iowa, speaking before hundreds of small audiences, but languishing in the polls. When Iowans and the rest of America discovered what better known and better funded Republican candidates were offering, Santorum suddenly leaped into national prominence. He describes himself as one of the most conservative senators in Pennsylvania's history. As a public service, I offer an outline of what he means.

Santorum’s working life has overwhelmingly been in Washington. After getting a law degree, he ran for the House in Pennsylvania in 1990 at age 32. In 1994 he won a Senate seat, which he retained in 2000. In 2006, he lost badly to Bob Casey. Since then he has served on the boards of directors of Pennsylvania companies whose fortunes he promoted while in Congress, earning hundreds of thousands of dollars annually for part-time work.

Extreme positions on social issues have shaped Santorum’s political identity. He opposes abortions even in cases of rape or incest, and favors prosecuting doctors who perform them. He opposes contraception, recently telling ABC’s Jake Tapper that he disagreed with the 1965 Supreme Court decision in Griswold vs. Connecticut, which struck down that state’s ban on contraception: “I have never questioned that the state has a right to do that. The state has the right to pass whatever statues they have.”

Santorum signed a pledge crafted by Personhood USA, which believes that the IUD, the morning-after pill, and the birth control bill should be banned. In October he said, “One of the things I will talk about, that no president has talked about before, is I think the dangers of contraception in this country. It’s not okay. It’s a license to do things in a sexual realm that is counter to how things are supposed to be.”

Santorum is also noted for his stance on homosexuality, which he recently compared to polygamy, bestiality and sex with children.

Santorum opposes virtually all forms of union activity. On his website he advocates cutting funding for the National Labor Relations Board. In the Fox News-Google presidential debate, he said he didn’t believe local, state or federal government workers “should be involved in unions.” He added, “And I would actually support a bill that says that we should not have public employee unions for the purposes of wages and benefits to be negotiated.”

Santorum has promoted the teaching of intelligent design as an alternative to evolution. In 2001, Santorum sought to amend the No Child Left Behind legislation so that students should hear “competing scientific interpretations of evidence,” including “such alternative theories as intelligent design.” This provision, written with the assistance of the Discovery Institute, came to be known as the “Santorum Amendment”. In 2005, a federal court ruled that the Discovery Institute pursued religious goals, and that intelligent design was a form of creationism and not a scientific proposition.

In an interview with Rush Limbaugh this past June, he called global warming “junk science” cynically promoted by liberals out to control people’s lives. He also blames liberals for the sex abuse scandals in the Catholic church.

Santorum, like other Republican candidates, favors cutting the taxes of the rich. He wants to retain the current low tax rate on capital gains, cut corporate taxes in half, and eliminate all corporate taxes for manufacturing corporations. He supported the Bush plan to privatize Social Security and continues to support this idea for younger workers.

When he looks at the bottom of the economic ladder, Santorum’s opposition to welfare for poor people appears to shade into racist assumptions. Despite the fact that whites are the overwhelming majority of welfare recipients, Santorum said just before the Iowa caucuses, “I don’t want to make black people’s lives better by giving them somebody else’s money. I want to give them the opportunity to go out and earn the money.”

In foreign policy, his proposals lie at the extreme end of Republican proposals. On his website, he “refuses to negotiate on any level with the terrorist state of Iran” and advocates “the authorization of targeted air strikes on Iranian nuclear facilities”, in order to “eliminate the Iranian nuclear threat immediately”. Just before the Iowa caucuses, he told NBC’s Meet the Press that if he’s elected president, he would bomb Iran’s nuclear facilities, unless they were opened for international arms inspectors. He is not interested in working with countries whose policies he doesn’t like: he advocates eliminating the post of US Ambassador to Syria and cutting the US contribution to the UN in half.

Santorum may have already reached the height of his popularity. Tracking polls show him dropping in the last few days, likely to come in fifth in New Hampshire with 8% and third in South Carolina with 19%. Perhaps his political proposals came 50 years too late.

Steve Hochstadt
Jacksonville IL
January 8, 2012

Monday, January 2, 2012

Calling All Iowa Voters

Today Iowa Republicans go to caucuses to select the first winner of the 2012 Presidential campaign. I wish you well.

I also wish you reason. Americans lend to Iowans an outsized voice in our electoral process. Your choices today will help shape 10 months of constant campaigning and then possibly 4 years of American life. This is an awesome responsibility for slightly more than 100,000 likely voters of your small rural Midwestern state.

Iowans get paid handsomely to take on this job. Ten million dollars was spent on political ads in December alone, with other millions on office rentals, meals, hotels, and travel. So we have a right to ask you to take seriously your role as national political arbiters. That means thinking about selecting a future President of the whole United States.

Our democratic system certainly benefits from the most diverse variety of political voices, left and right, up and down, and everywhere in between. We need the lonely voices, who promote principled positions beyond the boundaries where most people stop. We even need extremists, whose vehemence closes off debate, whose arguments have flaws apparent to everyone but themselves, if only because they demonstrate to the rest of us where the line of reason and reasonableness should be drawn.

But we don’t need them in the White House. Although a small number of people in Iowa and elsewhere apparently think it would be a good idea to elect some sexual predator who doesn’t know where Libya is, or some mad bomber who has fixed on Iran as his next target, or some fiscal crank who promotes 19th-century solutions to 21st-century problems, the rest of America would not benefit from a crackpot in the Oval Office.

Some things I hear about Iowa’s likely Republican voters make me wonder how seriously you are taking your job as first voters. Recent polls show that nearly half of probable caucus-goers won’t say Mormons are Christians. Less than half think that President Obama was born in the US. And the endless surveys, which by now must have dialed up every Republican phone in Iowa, have revealed fleeting infatuations with a series of extremists and incompetents.

These serial flirtations are partially the fault of the corporate media. The media treatment of politics as a permanent Olympics can actually make us dumber, when we need to be smarter. How many articles have you seen which discuss why the gold standard, Ron Paul’s fiscal panacea, was abandoned across the world a century ago? Or about the long-term effects on your personal finances of Cain’s 9-9-9 plan? Or about what would happen to our schools and schoolchildren if the Education Department was abolished?

But the irresponsibility of the media are only an excuse, not a sufficient justification for voter ignorance. Once every four years we all have to put more effort into informing ourselves about matters larger than our personal interests. We must seek out opinions beyond our comfortable prejudices. The rest of us, who surround your vital, but small piece of American life, need you to take your task more seriously and more inclusively.

Quite a few likely caucus-goers appear to believe the story that many of us out here, perhaps half of all Americans, are stupid dupes of a European socialist agenda, whose cheerleader-in-chief has pulled off one of the greatest political hoaxes in history in order to weaken America for his radical Muslim terrorist friends.

Give us a break. That story has always been stupid, but mainly it’s insulting.

We don’t care if you put on tea parties every other day. But on this day, please look up from the electronic devices that you have programmed to keep repeating that same story. Look in any direction – you see the rest of America watching you today. What you do matters.

Find someone who can embody the best in America, who can lead by persuasion, whose vision of the ideal American includes all of us.

When you pull that lever, pull it for all of us. Be more than first. Be leaders.

Steve Hochstadt
Springbrook, WI
December 31, 2011