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June 22, 2011

Republican, not Democratic

Michigan strengthens the Emergency Financial Manager law, giving the EFM authority to dissolve local elected officials, both school boards and city councils and mayors. These expanded powers are specifically requested by the Governor and approved by both houses of the legislature.

Michigan legislature meets behind closed doors to draw up a redistricting map, then schedules it for passage within a two-week schedule. This leaves no time for any modifications or corrections that may come from public review and hearings. They include a special provision in the legislation that prevents the bill from being overturned by popular referendum.

Michigan's governor presses the legislature to pass its budget as quickly as possible. Wisconsin's governor invokes special emergency legislation to deal with its budget. Time is of the essence, so there is little time for careful consideration of the impact or for review and input from those who are affected.

A presidential election is "too close to call". The losing candidate demands that the votes be counted. The winning candidate objects to actually counting the ballots, stages "riots" that threaten the vote counters, and appeals to the Supreme Court. The Supreme Court orders the counting to stop, allowing the winner to be declared by the local authority, a member of the winning candidate's election team. The Supreme Court also declares that its decision must not be referenced as a precedent in any subsequent case.

Bills are under consideration to solve the problem of voter fraud by requiring special forms of identification at the voting booth. Government-issued identification, such as driver's licenses and concealed weapons permits, are required, although government-issued college identification is not permitted.

New legislation is routinely introduced with a provision that prohibits judicial review of the legislation.

There's a common thread running through these stories, which reach over a 10-year period. That common thread is opposition to the core tenet of democracy -- giving a voice to the people who are being governed.

Democracy is a terrible way to run a government. It's slow. It's unruly. It forces people to compromise with opponents, and to explain and defend decisions.

That's no way to run a business. In these modern times, a modern corporation must be agile, fleet of foot, able to react quickly to threats and opportunities. A modern corporation doesn't put its decisions before all of the employees for their approval. Nor does it try to satisfy the needs of every employee. The modern corporation acts, and acts quickly. The modern CEO must be able to decide what must be done, and then make it happen.

Good for business. Not good for government. Not democracy.

We are in a new era of government, one in which democracy must -- if necessary -- take a back seat to solving the crisis we face. In this era, we must trust that the people we've elected are clear-eyed and well-intentioned, that they have a full command and understanding of the situtation and that they will make decisions that are good for us.

That's not democratic. And it's not Democratic. But it is certainly the new Republican.

The Republican party in Congress is marked by the ability to march in lock-step to a single point of view. Republican members of the Senate have become famous for their ability to stop legislative action while being a minority party. Republican members of the House turn to their leadership to learn how they must vote. These members are coordinated from the top of the party, and vote as directed, irrespective of their personal views and opinions.

The Democratic party is marked by the inability to enforce this kind of rigid discipline. By contrast, the Democratic members are always bickering among themselves, and the party leaders struggle to gather sufficient votes to move the leadership's programs forward.

Democracy is messy. It's unruly. It lacks discipline.

It's the worst form of government, as Churchill said, except for all the others.

Of course, you don't end democracy by having a vote. A vote would be democratic. You end democracy by simply ending it. By replacing it with something else.

Perhaps democracy has outlived its usefulness. Perhaps we are in a continuing state of crisis where democracy is the problem and not the solution. Perhaps we need to consider some other form of government -- government by the enlightened experts, for example.

The Republicans are doing their best to let us see what that is like.

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June 14, 2011

Democracy in New York's 9th Congressional District

It has been 10 days now in which the leading political story is the story of Congressman Anthony Weiner of New York. 10 days of titillation, 10 days of feigned shock and outrage, 10 days of lies and apologies, 10 days of righteous indignation and hypocrisy, 10 days of political pontification and prediction.

The primary theme has been that Weiner should -- many say, must -- resign his position.

The call for his resignation has come from the other political party, but that is to be expected. It has come from TV pundits and talk show hosts -- that, too, is expected. It has come from his own political party leaders and some members and from the President -- that is unusual, but understandable, as they all do the political win-lose calculations for the next election.

The call for his resignation has not, however, come from the people who hired him -- from his constituents. Weiner has been elected 7 times to the Congress by his district; in 2010, he received 59% of the votes to win. Polls taken among the voters in his district have produced a lot of ambiguity. People are offended by his actions, but they are also pleased with his actual job performance.

The relevant question here is whether the constituents have -- or deserve -- a choice in the matter of who their representative is. Should democracy prevail in this case? Or should this choice be overruled by the voices echoing outside of the 9th Congressional District of New York?

It is stunning to note that virtually no commentator -- whether politician or pundit  -- has started the conversation with this simple truth: "The people of the 9th District are the only ones who can decide this question."

In almost all cases, the authority of the voters is not mentioned at all. Instead, pronouncements of outrage from various leaders are given the status of authority. But the voters -- that core element of a democracy -- are left in the wings, without a microphone or even access to the stage. The case is treated as one best left to the professionals.

What is the message we send to these voters when we demand that their Congressman resign? The message is clear: "You voters are not smart enough to decide for yourselves. We will decide for you. Or your Congressman will decide that, despite your support, he should not follow your decision in the last election. You voters won't have a voice because you don't know what is best for you."

Democracy is a messy business. Winston Churchill is famously quoted as saying that democracy is the worst form of government, except for all the others. Democracy depends on people, who are as likely to be ignorant and prejudiced as they are to be well-informed and clear-thinking.

Are there cases where the people should not be permitted to decide on their own governance? Is this such a case? What governing principle is this based on?

In good government, democracy is always presumed to be the first and best option. In good government, the only outcry should come from voters inside the 9th District. In good government, all external forces should surrender their opinions to these voters, and advise the voters on whether their decision of November 2010 should be reconsidered or not.

This lynch mob attitude toward Congressman Weiner is not democracy.


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June 11, 2011

Good Jobs Create Tax Cuts

What does a job-creating government program look like?

We are in a time of higher unemployment, 8%-10% for the general population, and double that or more in the impoverished demographics of the urban core and rural outbacks.

We are also in a time of political aggression against direct government employment. Public workers -- teachers, janitors, office workers, administrators, policy-makers and public safety workers, construction inspectors and road crews -- are all under fire as examples of government waste.

What does a job-creating government program look like?

For 30 years, there has been an insistence that government taxes -- local, state and federal -- have been too high and that they are stifling business expansion. The obvious conclusion from this is that taxes should be lowered on employers. These tax cuts are cast as "job creating" tax cuts.

But are they?

Examining the relationship between individual tax rates and unemployment rates over the last 20 years (from 1991-2011) reveals nothing. Tax rates climbed in 1993 followed by a sustained drop in unemployment. Tax rates dropped in 2001 and 2003 followed by a sustained (and rapid) climb in unemployment. The bare facts are that tax rates have neither created jobs nor killed jobs. Nothing is that simple. There are no job-creating or job-killing taxes.

What does a job creating government program look like?

Perhaps we have it backwards.

We have been trying to produce a government program that offers a reward (a tax cut) in return for a hope (job creation). Such a program of course results in many businesses taking the reward without delivering on the hope.

What if we turn that around? What if we produce a government program that offers a reward (a tax cut) in return for performance (job creation)?

What if good jobs create tax cuts?

A reward in return for actual performance is a well-known concept in business. A CEO gets a bonus AFTER the stock price has reached record levels. A Division VP gets a bonus AFTER his division meets its P/L goals. A salesman gets a bonus AFTER she sells 150% of quota for the quarter.

We have tried government rewards for a promise of performance. But that is contrary to all common business behavior. We should turn that around.

Good Jobs Create Tax Cuts.

This is no longer a "job-creating" or "job-killing" government program. This is a "tax-killing" jobs program. Businesses can participate -- and reap the reward -- or not, at their choice. The performance metric is straight foward:

  • Over the last tax year, did you increase or decrease your US work force?
  • Over the last tax year, did you increase or decrease your US compensation?
  • Over the last tax year, did you increase or decrease benefits to your US work force?

In short, if a business improved the condition of the working class in the US, then they are rewarded with a tax cut. If not, they get no reward.

There are hundreds of ways to detail out this program. Tax benefits may increase based on the degree of improvements in the working class. Tax penalties may be applied to those who degrade their workers, through layoff, wage reductions or benefit reductions. The work force may be segmented into minimum wage, middle class wages, and executive wages, and measured separately (for example, no credits for increases to the executives).

But those are details. The driving principle behind them is the reversal of the discredited belief that tax cuts create jobs. They do not. That principle must be discarded and replaced with:

"Good Jobs Create Tax Cuts"

We've been on the wrong road long enough. It's time to turn around.

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