The Cause and Cure for the London Riots

It’s time to put on your big boots, folks.  As the riots in Britain die down, everybody and his friend is busy telling us what really caused them.  An awful lot of equine feces is being tossed about; you don’t want to step in any of it.  Even as I write this, journalists and politicos are rounding up the usual suspects and sentencing them — without trial.  Apparently, society was the big ring leader… again — and its lieutenants, poverty, unemployment and government cutbacks were also in on it.  Young people were the innocent victims … again, pushed to the breaking point of violence by their disadvantages, the police and some guy in Earl’s Court with a steady job.  It’s all quite simple.  Community organizers and activists have been telling us for years we need to give these people more money or something like this was bound to happen.  It’s kinda like paying Tony Soprano so his boys don’t come around after dark and burn down your store.  Extortion is such a hard word, so let’s just call it investing in the future.

For the last fifty years or so, society has been investing in the future under the quaint idea that disadvantaged people are somehow different from the rest of us.  Contemporary mythology has it that poverty and unemployment are social ills caused by cold-blooded governments and the rank abuses of our money market society.  Anybody unfortunate enough to get trapped by this double whammy suddenly becomes helpless and stupid.  The popular assumption is that, without a battalion of social workers, organizers, services and institutions to direct their every move, the underprivileged have no hope of changing their circumstances.  Faced with our uncaring 21st century, even the most stalwart Horatio Alger character quivers in his shoes, drops out of school and turns to a life of indolence and maybe even drugs.  Society (that’s us, folks) is responsible for these unspecified crimes against the underprivileged and must, therefore, fork over great gobs of money — which for the last fifty years at least, has never been enough.  So goes the prevailing wisdom of our time, perpetrated by a crowd of social commentators who wouldn’t know poverty if it bit them on the bum.

Here’s the real deal.  Poverty is relentless.  No visiting newscast or YouTube sound byte can portray this.  It never takes a holiday.  It sleeps with you like an evil lover.  It seeps into your soul.  It feeds on your heart and sucks your energy until it consumes you.  It’s 25/8 ugly, and the only relief is sex, drugs and rock and rock.  I’m not talking about digging-in-a-dumpster poor – although I suppose the shoe fits.  I’m talking about people who just don’t have enough money – the Have-nots.  These are the people whose children flared out of control in a vomit of violence the other night that sickened even their neighbours.  These are poor people (I don’t care what the current euphemism is) and they exploded in London and elsewhere because they’re poor and we’ve been telling them for fifty years they’re getting screwed.

The current crop of social engineers view the poor as if they’re from another planet.  They theorize and chatter and then go back to their tidy tree-lined avenues and wonder what went wrong with “those people.”  It’s never occurred to them that “those people” want some tree-lined avenues, too.  Basically, the Have-nots want to be Haves.  Having established that point, let’s quit lying to ourselves and others and face the fact that there’s only one combination in our world that leads to permanent “Have-dom.”  It’s pride, education and hard work.  There’s no government program, no social get-fixed-quick scheme and no secret formula.  It’s that simple.  It’s time to quit listening to the caring/sharing class and start applying some bold initiatives to our war on poverty.

There are too many programs to deal with, so let me just use the most notorious one, welfare, as an example.  In its current form, welfare is an implement of permanent debilitation.  Welfare benefits are usually at subsistence levels with no extra pennies available to even stock up on toilet paper when it goes on sale.  For long-term welfare recipients, it’s impossible to get ahead.  Then if they do manage to get a job — even a low-paying, part-time one — their benefits are cut.

This is exactly backwards.  Those benefits should be increased.  There should be a financial reward for pride and hard work, not a punishment.  It should work the same way for education; not idiot education like medieval dance, but quality job training.  Again, benefits should be increased to those willing to go to school – and graduate.  And this should apply across the board; families should receive extra benefits when teenage children do not drop out of school and lose them if they do.  There should be a definable series of financial rewards to anyone willing to help themselves.  Rewarding enterprising people is the way our society functions, and it functions the same for everybody – even the underclass. Yeah, some people are going to scam the system, but the majority won’t – and, by the way, society is paying the money anyway.

Permanently warehousing people in dilapidated neighbours with nothing to look forward to but more of the same hasn’t worked.  Crime, prostitution and drugs offer better financial rewards than poverty line welfare payments.  And the sickening by-product is shame and frustration.  The riots in London prove this.  We need to turn our attention away from forking out money for nothing to offering serious financial benefits to those who want to change their way of life.  If you’re not convinced, here’s one more thing to think about.  Those minor drug dealers who inhabit every poor neighbourhood on the planet are, in reality, just laissez-faire capitalists.  They understand how our world works.  In fact, they understand it a lot better than that army of social workers we’ve hired who can’t seem to figure it out — because they’ve never had to go without.

How to Ruin a Debt Crisis: Part III

To put it mildly, America is in the middle of an economic crisis… again.  However, there’s a difference between this one and the crisis of 2007-08 or even 2000.  This time, instead of faceless, nameless corporate executives, Americans have somebody real they can blame — and it just might be Barack Obama.  If this credit downgrade by Standard and Poor’s sticks to the President and the crisis turns political, America is in for a ride right out of Roller Coaster Tycoon, and the rest of the world better buckle up ‘cause they’re coming, too.

Before we discuss the mayhem that’s about to ensue we need to get a few facts straight.  First of all, there’s nothing wrong with the American government’s credit.  If anybody would take even a brief panic pause, they’d notice that most people who are getting out of the stock market are putting their Yen, Yuan and Euros into US Treasury Bills.  So much for America’s inability to pay its debts!  Secondly, the US economy is in trouble, but it’s not on the verge of collapse.   Of the twenty largest corporations in the world, ten are American — and that doesn’t include Disney, Coca-Cola or McDonald’s.  Visa and Mastercard are American companies, as are Facebook, Google, Microsoft, Intel and Apple.  Your physical laptop may be made in China, but the guts that run it are American.  Also, there are two essential concepts you need to understand.  One: every single American, from birth, knows that, unless it’s your team, nobody cares who didn’t win The World Series.  It’s in their DNA somewhere.  To reiterate, they believe that there are champions and then there are the other guys; you don’t get points for close.  Two: in general, ordinary Americans don’t know anything about the rest of the world, and they don’t care.  It’s not arrogance; it’s a simple fact.  Why don’t they care?  They don’t have to.  This isn’t bashing “stupid” Americans.  Think about it, objectively.  What difference does the rest of the world make to them?  The reality is not much.  Former Speaker of the House, Tip O’Neill, once said, “All politics is local.”  For Americans this is true.  That’s why Barack better shape up, or in 2012, the locals are going to go Jimmy Carter on his ass and he’ll be spending the next four years planning the Obama Library.

Here’s the scenario.  Last November, the Republicans may have taken control of the House, but it’s the Tea Party caucus that owns it.  They proved that during the debt ceiling fiasco.  As it stands now, in 2012, there’s more than an even chance the Senate could go the same way – a Republican majority with Tea Party control.  Now, as of last Friday, Standard and Poor’s threw the White House into the mix.  Obama’s approval rating is at 40%.  That’s not enough to win re election.  If a Republican – any Republican – gets to redecorate 1600 Pennsylvania Avenue next year the Tea Party is going to be running the show.

Tea Party people are fed up with playing nice with the rest of the world.  They see America as getting kicked around by every two-bit country with a vote at the UN, and they’re tired of paying for that privilege.  This credit downgrade is just another example to them.  They look at the billions spent in Iraq and Afghanistan and say, “Hey, wait a minute!  We could have used that money.”  They want to stop wasting lives and dollars on foreign adventures and get their own house in order.  They want to protect their own borders, their own jobs and their own industry — before they start tackling other people’s problems.  They want to feed and educate their own children first.  In short, they’re old-fashioned Isolationists.  But before the anti-American choir starts gearing up for the Hallelujah Chorus, let’s look at what this means.

Admit it or not, America has been doing the heavy lifting — economically and militarily — around this planet since 1945.  American military spending has allowed Europe to spend their money on social programs and Canadians to buy Health Care.  The foreign aid they gave Asia established global industries that turned Pennsylvania, Ohio and all points northwest into the Rust Belt.  They’ve paid for schools and hospitals across South America and Africa.  And it goes on and on.  There is no part of contemporary society that hasn’t benefited from American dollars.  Pax Americana has given our world the time, space and peace to grow scientifically, medically and culturally.  Anti-American gasbags don’t realize the USA is the most benevolent Superpower in history.  They never mention the trillions of dollars worth of free food Americans have sent around the world, or the free medical aid or industrial assistance.  They don’t talk about things like the Center for Disease Control in Atlanta, or the American Red Cross or the IMF or the World Bank or any of the other goodies Americans have been paying for — for two generations.

So what happens if an America First Congress starts turning off the money tap?  Every country west of the Bosphorus is going to have to up their military spending by at least 20%.  Europe doesn’t have that kind of money, but they’re going to have to find it.  Canadian Arctic sovereignty will become an expensive proposition.  South Korea will have to do some serious sucking up to Kim Jung-il.   Japan had better invest in missile defence, and China’s lost province of Taiwan will probably be reunited with the mainland, at long last.  The Middle East is too disastrous to even contemplate, but Iran’s neighbours should consider stocking up on bomb shelters and HazMat suits.  And the military spending isn’t even the half of it.

If America erects protectionist trade barriers and shuts the world’s biggest economy out of the free trade loop, the Great Depression is going to look like a walk in the park.  World trade will collapse, just like it did in 1929 — but the fall will be further because billions more people depend on it.  Modern Asia’s prosperity is built on exports; and without them they’re burnt toast.  The Yuan, China’s much-manipulated currency, won’t be worth the time it takes to print it – never mind Asia’s lesser economies.

Then there are all the other non-threatening by-products of American isolationism.  Frantic calls from places like Haiti, Somalia and Indonesia will still be there, but they’ll be put on hold.  Relief efforts in non-big-media areas will wither and die.  The UN, not a Tea Party favourite, will be looking around for lunch money, and Unicef, Unesco, WHO and all the other alphabet agencies will be having bake sales to pay the bills.

The last time America shut the doors and went about its business, there was a global economic disaster and a world war.  In the 21st century, American voters are not going to complain if their government stops spending money in places like Eritrea; most of them don’t even know where that is.  No pressure, but Americans don’t like a loser either; so, Barack, you’d better come up with some economic answers pretty quick — or the political fallout is going to be heard around the world.

How to Ruin a Debt Crisis: Part II

The problem is this just might stick to Obama.  The president may have finally run out of Teflon.  Unless Barack can figure out a way to pull some leadership out of that teleprompter, he’s going to be wearing this like last month’s pastrami when he has to face the people in 2012.  It’s going to hurt him.  I know this is a bold statement about the most adroit politician to come out of Chicago since Dick Daley, but think about this.  I haven’t even told you what I’m talking about yet.  You already know what it is, though.  It’s the American debt crisis and Standard and Poor’s downgrading of the US credit rating – and yes, it is a crisis.  The White House has gone to DEFCON 2 on damage control, but it ain’t going to help ‘cause, as Harry S Truman’s eloquent little sign pointed out, “The Buck stops here.”

For the last 48 hours, Obama apologists have been setting break fires wherever they can find a Blackberry or a microphone.  The first line of excuse is Standard and Poor’s made a mathematical mistake – a couple of trillion dollars, apparently.  This one is way too highschool lame to even deal with.  From there, they take a run at the Republicans, who just weren’t being reasonable about Obama’s plan for a “balanced approach” to the debt crisis.  Good point, except for one minor problem: there never was an Obama plan (at least not one that was written down anywhere.)  There was a lot of in-general talk about compromise, but the Commander-in-Chief never stood up and said “This is the problem, and this is what I’m going to do about it.  Okay, Broehner.  What’s your plan?  That’s stupid.  Now let’s hammer out a deal.”  The fact is most of Obama’s thoughts on the debt crisis (including “balanced approach”) were just more media platitudes that don’t actually mean anything but invoke some vague idea of reasonable behaviour.  Even the most ardent supporter can’t point to Obama’s chapter-and-verse solution to keep America out of debtors’ prison.

Finally, the Obamanista have been dragging all-purpose bogeyman George W. Bush out of retirement and kicking him around again.  After all, that worked in 2008.  “Bush was the one who spent all the money.  (Stage direction: point fingers accusingly)  He did it.”  Please!  Yeah, yeah, yeah!  We all know that Dubya is responsible for everything from 9/11 to Lebron losing Game 6 to the Mavericks, but there’s got to be a statute of limitations somewhere on the guy.  Even if he did spend all the money, it’s Obama’s job to fix it, and he’s had three years to do it – which he hasn’t.  Besides, everybody knows the bottom line is no matter what, where, who, when or why the debt got out of control, Barack Obama was the guy sitting in the Oval Office when the cash cows ran dry.  That’s what history and the electorate will remember, and if either one ever forgets, the Republicans are going to remind them.  And that’s the problem.

Americans are a mercantile people.  They’re willing to trade a lot if they think they’re getting something for their money.  In this case, they were willing to go with a next-to-useless president because he was interplanetary cool.  In 2008, the whole world loved the guy.  (He started his presidential campaign in Germany, for God’s sake.)  So, during the election, nobody bothered to notice that Barack Obama was a (less than one term) junior senator, with fewer credentials to be president than Millard Fillmore.  He expounded change and then cut a traditional backroom deal with Hillary to make her Secretary of State — but nobody cared.  The guy was Kennedy-sweet — with no downside.  He got the Nobel Peace Prize just for showing up.  All he had to do was hang out at the White House, pull an Eisenhower and don’t touch anything.  Most Americans would have been more than happy with that after eight years of George Bush.

However, Americans are also a proud people.  They don’t like it when they think they’re not getting their money’s worth.  And they get downright unreasonable if they think they’re being conned.  Herbert Hoover, Jimmy Carter and George Bush the Elder are just a few one-term presidents who tried to pull a fast one on the American people.  This is where the Tea Party comes from.  It doesn’t take Howard Beale to figure out there’s a boatload of folks across America who are “mad as hell and not going to take this anymore.”  Despite what The New York Times will tell you, these folks are not an isolated pack of snarling, white-haired, right-wing, Sarah Palin nut bars.  They’re ordinary folks who think they’re watching their prestige going over the falls along with their economic future.  This is just insult to injury to an electorate who trusted Barack Obama to change America’s position on this planet.

Right now there is an economic crisis in America.  So what?  That’s nothing serious!  Take a look around you.  There are more farmers raising livestock on Facebook than there are on real farms in Europe, and Facebook is less than a decade old.   More people are touching Google on their iPads every day than there are people in Malaysia.  Google is a teenager and iPads didn’t even exist when Obama was elected.  Last year Walmart customers made 7.2 billion purchases (the population of the world is approximately 6.5 billion) and most of them were made with a Visa or Mastercard.  Americans win more money on Jeapordy than most humans earn in a year.  Use your head, folks: American economic power is awesome (in the true sense of the word) I don’t care what Standard and Poor’s says.  However, if this thing really does stick to Obama and these economic problems turn into a political crisis, all bets are off.  The world is going to change radically and not in that cool, glamourous way Barack was singing about three years ago.  It’s going to get ugly, and it’s going to be mean.

Wednesday:  What happens to economics when American voters get angry?