Showing posts with label America. Show all posts
Showing posts with label America. Show all posts

Thursday, May 25, 2017

American Tragedy

Most Americans consider themselves socially liberal and fiscally conservative, but they're really socially judgmental and fiscally ignorant.

How else is America the most conservative developed country on issues like the death penalty and abortion and unable to understand basic issues like debt's impact on inflation?

A country that runs on debt is a country where politicians can pander to every single group's demands--regardless of merit or long-term consequences.  Furthermore, peace based on cheap debt is not peace at all--it is a slumbering giant waiting for collection day.  

Monday, April 24, 2017

The Fugees: Inaction Killing America's Leadership Potential


This map represents the West's cowardice and lack of humanitarian leadership. Bombing Syria, destabilizing the Middle East, and doing nothing to assist refugees other than paying the U.N. is morally wrong.

I'm sure many Americans made the same cultura
l assimilation arguments against accepting Jews during WWII--during a time when people weren't 100% sure what was happening. Today, we have satellites. We have no excuse. We know what is happening and do nothing. (Well, except telling Turkey that America is willing to accept their educated refugees only, especially PhDs.)

History will not forget. The Syrians and Iranians have accepted many refugees in their history. America, when given a chance to try to rebuild communities, failed. 

© Matthew Mehdi Rafat (2017)

A reader responded: "Perhaps a more kind way of saying the same thing is that the U.S. doesn't know what culture it has anymore. No one is really giving a voice or identity to this generation, and we haven't adopted the good ideals of the founding fathers of making the U.S. a haven for the poor and downtrodden. I find it so interesting that people want to "make America great again" by doing the exact opposite of what made it great in the first place: granting poor people property and a chance at a normal life, regardless of their background."

Bonus: Amazon's Jeff Bezos was raised by a Cuban refugee.  Andre Agassi's father was an Armenian refugee raised in Iran.  He represented Iran as a boxer in the 1948 and 1952 Olympics. 

Tuesday, April 4, 2017

Credit and Credibility in America

America Has the Most Complex System of Government Worldwide

I'm keenly interested in how other countries promote stability and confidence in government services. For example, compare London, England (about 8 million residents) to the Bay Area in California (about 7 million residents). The Bay Area has several different FBI offices, Sheriff's offices, and city police departments. Except for the FBI, all the offices have different elected or appointed leaders. Meanwhile, London is served by one Metropolitan Police Department, which employs about 50,000 people. It's true London is subject to jurisdiction by the National Crime Agency, but overlapping jurisdiction is rarer, and we're still discussing two law enforcement agencies rather than ten-plus in the Bay Area (S.F., Cupertino, Campbell, Sunnyvale, Palo Alto, Oakland, Alameda County, San Mateo County, Santa Clara County, Marin County, etc.).  Having one police agency reduces administrative overhead as well as the need for different procedures, but it also seems to provide greater trust through greater simplicity.

America, in contrast, has at least three different levels of governance and taxation: federal, state, and local (city and county).  In a typical day, an American parent might pay gas taxes to the state and the city; educational fees to a local school board--which may have independent taxing authority--and a state; and then sales taxes at different rates to yet two other cities. Such fragmentation makes it difficult to determine whom to hold accountable if anything goes wrong; worse, it's harder to improve services even if nothing is wrong because of the need to understand different and overlapping procedures and jurisdiction. (And we haven't even mentioned property taxes or special assessments.)

As one might expect, such complexity increases the potential for corruption exponentially, especially when the goal is to increase annual funding under a system forcing governmental entities to compete against each other for the many of the same dollars. In one instance, a county and city in the same territory sued each other over a dispute about which entity was entitled to millions of dollars of tax revenue already received.

In other countries, the federal/national government might act as a tax collector and then distribute funding to states or territories, thereby creating greater fiscal accountability through separation. When the entity using the money isn't the same entity collecting it, chances of corruption are reduced. Think of it this way: if you apply for a passport at one office but have to pay the fee in another office and bring back a receipt allowing you to pick up your passport, the chances for bribery are almost nil.

On paper, the idea behind America's governmental diversity is to increase checks and balances and to provide opportunities for each city and state to create their own cultures, which might appeal to different persons and therefore increase inclusivity. Don't like too much government?  Go to New Hampshire. Want lots of government? Go to Northern California. Is your local police force not handling your complaints properly or arresting one racial group more than others for no reason? The federal government can step in on your behalf and sue to fix the problem.

In practice, however, attempts at governmental diversity and accountability have failed, causing almost total mistrust of government. Rather than provide true checks and balances, America's political system of local, state, and federal power has led to more "gaming" on each level, creating complexities difficult to unwind. The original system was created by people familiar with only 13 colonies/states with a population of about 2 million residents in 1775 and about 4 to 5 million in 1800 (not including natives). We can't even remark, "I don't think we're in Kansas anymore," because Kansas didn't exist at the time.

Debt Restricts True Freedom of Choice

Despite such a convoluted system, if people were able to move easily, they could take advantage of different cultures and activities nationwide. On paper, if one city or state was corrupt or close-minded, a family could move and start over in another less corrupt place. In practice, it just doesn't work that way. A college graduate lacking parental support would have about 20,000 USD in student loans. If this person was particularly ambitious, s/he might advance to graduate school, which would necessitate more student loans (though many science/engineering degrees provide grants and stipends). In either case, most of the college grad's networking opportunities would be local or at least in the same state, limiting employment mobility. Thus, despite having the technical ability to move 2,800 miles away, freedom of choice is limited by systemic forces, especially college and networking connections, which tend to be local.

In addition to the general need for alumni connections to garner employment, the need to go in debt to receive not only a college degree but a home and perhaps a new car restricts freedom of movement. If one buys a new car--a requirement in most American cities, which lack efficient public transportation--the value of the car immediately depreciates, making it inadvisable to sell quickly.  (An auto lease is possible but a terrible deal because of the lack of ownership and mileage restrictions.) Basically, more debt restricts flexibility, especially when much of the debt creates local rather than cross-border advantages.

What about buying a home, the most "local" purchase one can make? Under the federal tax code, it would be foolish to buy a home and sell it in less than five years due to numerous costs associated with the sale and the tax benefits of waiting at least 2 years--and that's before a possible penalty for early mortgage payments.

Furthermore, most college grads don't buy homes after graduation. They tend not to have practical skills, because most professors lack recent relevant work experience, meaning even after years of paying tuition, graduates still rely on business investment and training to be productive and profitable. In the meantime, since saving for a down payment can take years, renting is the most feasible option.

In short, a successful American reaching the age of 24 might have 22,000 USD in student loans, a car loan of 12,000 USD, and no ownership of anything other than a piece of paper--while being dependent on local connections to maximize employment and debt-repayment options.

People in Debt are Beholden to their Elders and Therefore the Establishment

A person with 34,000 USD in debt isn't likely to rock any boat. In fact, because of the convoluted system we discussed earlier, such a person is better off brown-nosing as many people as possible to increase his or her chances of receiving employment, even exaggerating his or her expertise to compete with other applicants. As you might predict, in such a dynamic, integrity is often the first value to dissipate, as everyone is focused on paying off debt rather than working together to advance long-term goals. A good reputation is a fine virtue, but not one you can eat.

Establishment-Oriented Societies Do Not Favor Dissent

In San Jose, California--one of the largest cities in America--both recent mayoral candidates graduated from the same private Catholic high school. This was not an accident. Why would anyone pay 7,000 to 12,000 USD for their children to attend a private school when MIT puts its content online?

What if the American Establishment is so ensconced in power, you have to buy your way in?  Maybe it doesn't matter how intelligent or honest your daughter is--if she wants to be mayor one day, what really counts is whether her parents put her in the right private high school. As of April 2017, Santa Clara County's Board of Supervisors is majority Catholic. Dave Cortese attended Bellarmine (Catholic) high school. Cindy Chavez graduated from Moreau Catholic High School in Hayward. Mike Wasserman attended Bellarmine (Catholic) high school from 1972 to 1976. Who's the top local cop? Eddie Garcia, who attended St. Francis High School. As of 2017, Bellarmine high school charges over $20,000 annually in tuition.

It's true all alumni tend to look out for each other, but if you need to start in high school to build those connections, your children will get the jobs left over after the elites assign the ones they want to themselves--regardless of integrity. In such a system, loyalty to your own fiefdom matters more than loyalty to country or the public trust. Some entities, including the military, may convince themselves that looking out for each other is the same as being patriotic, but even General Colin Powell was made to look foolish by intelligence agencies with false information when he testified in favor of invading Iraq. In an age soaked with debt and paid-for connections formed as early as high school, integrity doesn't matter as much as maintaining institutional image.

When Donald Trump said during the presidential debates that mitigating taxes was "smart," he was right--the tax code allows him to take a deduction, so why shouldn't he? What obligation does he have to anyone else, especially when he can donate the money he saved to the entities of his choice--just like Warren Buffett, who will evade the estate tax by donating almost all of his billions to a fellow billionaire?

What happens to dissent in such a system, when the elites look out for themselves, their friends, and their particular institution's image more than any long-term view about what is best for the public?

How can the younger generation--which used to raise hell about unjust wars such as Vietnam--muster any sustained dissent when they are in debt as early as 19 years old or dependent on parental funding?

If government spending drives so many well-paying jobs--now with better benefits than the private sector in many states--and maintaining institutional image is more important than integrity, why would any rational college student or graduate speak out against any entity connected with the government, such as police, teachers, or firefighters? (One side is backed by billions of dollars each year, and the other owes thousands of dollars to the same aforementioned people.)

What happens to a society when the only people capable of bucking the Establishment are themselves part of it?

What happens to a society when the incentive for being honest is non-existent while the incentive for supporting the status quo is the greater likelihood to pay off debt one was forced to take to achieve the possibility of a middle class lifestyle?

I'm interested in knowing whether the problems I've mentioned above are the same everywhere, or especially so in the U.S.  Stay tuned... 

© Matthew Mehdi Rafat (2017) 

Monday, January 10, 2011

Thomas Paine on America

Thomas Paine, from The Rights of Man:

If there is a country in the world where concord, according to common calculation, would be least expected, it is America. Made up as it is of people from different nations, accustomed to different forms and habits of government, speaking different languages, and more different in their modes of worship, it would appear that the union of such a people was impracticable; but by the simple operation of constructing government on the principles of society and the rights of man, every difficulty retires, and all the parts are brought into cordial unison. There the poor are not oppressed, the rich are not privileged. Industry is not mortified by the splendid extravagance of a court rioting at its expense. Their taxes are few, because their government is just: and as there is nothing to render them wretched, there is nothing to engender riots and tumults.

More here.

Tuesday, March 24, 2009

Hamiltonian Wisdom

I've always favored Jefferson over Hamilton, but this Federalist Papers excerpt is making me reconsider my anti-Hamilton stance:

http://avalon.law.yale.edu/18th_century/fed01.asp

It has been frequently remarked that it seems to have been reserved to the people of this country, by their conduct and example, to decide the important question, whether societies of men are really capable or not of establishing good government from reflection and choice, or whether they are forever destined to depend for their political constitutions on accident and force...

So numerous indeed and so powerful are the causes which serve to give a false bias to the judgment, that we, upon many occasions, see wise and good men on the wrong as well as on the right side of questions of the first magnitude to society. This circumstance, if duly attended to, would furnish a lesson of moderation to those who are ever so much persuaded of their being in the right in any controversy. And a further reason for caution, in this respect, might be drawn from the reflection that we are not always sure that those who advocate the truth are influenced by purer principles than their antagonists. Ambition, avarice, personal animosity, party opposition, and many other motives not more laudable than these, are apt to operate as well upon those who support as those who oppose the right side of a question. Were there not even these inducements to moderation, nothing could be more ill-judged than that intolerant spirit which has, at all times, characterized political parties. For in politics, as in religion, it is equally absurd to aim at making proselytes by fire and sword. Heresies in either can rarely be cured by persecution...

On the other hand, it will be equally forgotten that the vigor of government is essential to the security of liberty; that, in the contemplation of a sound and well-informed judgment, their interest can never be separated; and that a dangerous ambition more often lurks behind the specious mask of zeal for the rights of the people than under the forbidden appearance of zeal for the firmness and efficiency of government. History will teach us that the former has been found a much more certain road to the introduction of despotism than the latter, and that of those men who have overturned the liberties of republics, the greatest number have begun their career by paying an obsequious court to the people; commencing demagogues, and ending tyrants.

Hamilton's ideas triumphed over Jefferson's. As a direct consequence of Hamilton's writing and influence, America received its foundation for modern governance and economic regulation. Could Hamilton envision, at the time he was writing, the kind of country we have today? Of course not. He had, at most, general ideas with no specifics. He could not have known that he was putting in place a framework that would eventually produce the modern car, iPhones, eBay, and other economic wonders. It just goes to show you that when you're doing something, even if you know it's historic, you can never know the full panoply of potential ramifications.

It is a shame that The Federalist Papers are not required reading at every American high school. Unfortunately, it was not until after I graduated law school that I bought a copy and read it. How can we be graduating so many Americans who have little idea of their own country's founding principles? If the test of an enduring empire is whether its citizens know and respect its history, America's longevity may be in question.