Bernie!

June 1, 2015, 3:45 PM

Why the 99% Should Support Bernie's Campaign

Contents
Who is Bernie Sanders?

His Campaign's Challenges

What is Socialism?

Is Bernie's Platform "Socialist"?

Reference Sites

Who is Bernie Sanders?

Senator Bernie Sanders is a solid, widely experienced, accomplished, popular, and well-regarded student of public policy, legislation, and spokesperson for the people.

Presidential candidate Senator Bernie Sanders, an Independent from the state of Vermont, raised $1.5 million during the first 24 hours after his announcement -- more than any Republican candidate did in a comparable time -- and is getting wildly enthusiastic crowds of ever-increasing size in Iowa and wherever else he appears. We witnessed this phenomenon at close range here in Iowa City this past Saturday (see video of presentation, below). Trip Gabriel and Patrick Healy, "Challenging Hillary Clinton, Bernie Sanders Gains Momentum in Iowa,", New York Times, June 1, 2015, p. A12.

[In Davenport, where Martin O'Malley announced his candidacy to a "crowd" of 50, Bernie Sanders had earlier attracted 700 -- the largest crowd for any presidential candidate in Iowa this year. In little Kensett, Iowa, population 261, some 300 turned out to hear him. His Vermont kick-off drew 5000; his post Iowa stop in Minneapolis, 4000.]

Neither Democrat nor Republican, he's sufficiently well regarded by his Senate colleagues that they've given him the coveted position as ranking member of the Senate Budget Committee. He often caucuses with the Senate Democrats, and will be running as a Democrat during the forthcoming caucuses and primaries. He is sufficiently well regarded by Democratic Party voters that 15% of them are already leaning his way in what had been predicted to be the Party's Clinton coronation nomination process.

A part of his appeal is his authenticity. He tells his followers what he thinks, not what some campaign manager told him to say. Part of the reason he comes across as genuine is that he says the same things in Iowa that he does in Washington or Vermont. Another reason is that he's been saying the same things all his life. This is no etch-o-sketch candidate, changing the message as the audience, times and polls require.

Bernie is a graduate of the University of Chicago, 1964, who has been winning elections since 1981:Mayor of Burlington, 1981-1989; U.S. House of Representatives, 1991-2007 (in Vermont a statewide office); and U.S. Senate, 2007-present -- most recently re-elected with 71% of the vote. [Photos credit: Nicholas Johnson. These three photos of most of the crowd inside the hall (though not all) give a sense of the numbers. All chairs were taken by 9:20 or so for the 10:00 a.m. event. I was tasked with monitoring the mob outside the only entrance -- glass with a view of some of the lobby. Although I could not see the entire area, if there were over 300 inside the hall there were possibly as many outside as well. -- N.J.]

Not only does he have proven popular appeal, the political professionals give him comparable reviews. This is no ineffective, isolated, independent, iconoclast, shouting from the sidelines. The Almanac of American Politics calls Sanders a "practical and successful legislator." Last year, when he succeeded in his efforts to pass legislation reforming the VA health care system, the Congressional Quarterly said Senator Sanders was able “to bridge Washington’s toxic partisan divide and cut one of the most significant deals in years.”

His Campaign's Challenges
His personality, presentations, and positions on the issues are such that every member of the 99% ought to be supporting him. Why isn't everyone there -- yet? There are two challenges.

Central is our corporate media's approach to politics in general and the presidential primaries in particular -- as a horse race, and delights over their gotcha presentations of candidates' gaffs. When Sanders is mentioned at all it's usually to compare him with Hillary. Seldom has any report devoted even a single sentence to each of his policy proposals -- most of which, polls show, are supported by a majority of Americans.

However one might characterize what the media is currently doing, it's not an effort to inform and involve the American people in a discussion and debate regarding the "best practices" approach to our nation's challenges. Since that's what Bernie wants to do, no other candidate seems to, and therefore ought to be one of the most newsworthy elements of his campaign, the fact that it's impossible to report his exciting platform in the media's 20-second sound bites is a substantial campaign challenge.

The other major challenge is Sanders' association with what for many Americans is the dreaded word "socialist" -- the modern day equivalent of Senator Joseph McCarthy's irresponsible use of the label "communist."

What is "Socialism"?
Socialism might be loosely thought of as government (federal, state, county, or city) ownership and control of the means of production and distribution, the provision of services or facilities. "Capitalism," by contrast, suggests a system in which these things are the province of private individuals or corporations.

Thus, our interstate highway system might be characterized as "socialist highways." Privately owned toll roads and bridges (there are a few) would be "capitalist highways."

In the real world there are few pure "communist," "socialist," or "capitalist" countries. China is ruled by a "Communist Party" and yet is best known today for its galloping capitalist advances that are providing a real challenge to the rest of the world's economies, including ours.

Like China, ours is also a mixed economy. Americans may not be unanimous, but most seem to like the idea of socialist roads and bridges; national, state, county and city parks; public K-12 schools and state universities; and public libraries. They like cooperatives, whether for farmers, rural electricity, grocery stores, or credit unions. They don't seem to mind -- at least not enough to abolish them -- the blend of government and corporate institutions known as"corporatism" that transfers taxpayers' money to private "capitalists" (in the form of grants, tax breaks, TIFs, subsidies, price supports, earmarks, and other creative schemes -- limited only by the imaginative abilities of business persons and those whose campaigns they fund).

So I think it's a little silly to treat "socialist" as a "slur word" when we're all living in the midst of it and liking it -- the sidewalk and road in front of my house, the trash collection truck that just drove by on it (and the recycling truck that will soon follow), the water plant and main that just provided the water I needed to make tea, the fireplug on the corner of our lot, the public library book that sits on my desk as I keystroke this blog essay, the park across the street, the street cleaning machine that drove by the other day.

Besides, I think living a life of labels -- whether of ethnicity, gender, race, religion, or political ideology -- is dangerous, limiting, and not very productive. When it comes to public policy, we're better off evaluating the challenge, the data, and the options for solutions than to accept, or reject, proposals on the basis of ideological labels. Of what relevance is it to adequate funding for our roads and bridges whether the tax, and the projects it funds, are labeled "capitalist," "socialist," "libertarian" -- or "communist"? A pothole, or a falling bridge, has no ideology.

Is Bernie's Platform "Socialist"?
It would be amusing if it were not so serious that anyone would want to use "socialist" as a pejorative in trying to diminish Senator Sanders. He's as American as Vermont maple syrup. He is brighter, more creative, compassionate, accomplished, experienced, and committed to his constituents than most. But aside from that, he is otherwise merely engaged in the same kinds of political and legislative activities of other U.S. senators since the beginning of our nation.

Those who do find labels useful would probably consider the Cato Institute either "conservative" or "Libertarian" or both. Here's what it has to say about Senator Sanders:

According to the National Taxpayers Union, 42 senators in 2008 voted to spend more tax dollars than socialist Bernie Sanders. . . . Meanwhile, the American Conservative Union rated 11 senators more liberal than Sanders in 2008, . . .. The Republican Liberty Caucus declared . . . Sanders voted better than 31 colleagues in support of personal liberties.

David Boaz, "Is Bernie Sanders the Most Liberal Senator?" "Cato at Liberty," Cato Institute, April 30, 2015.

As Ralph Nader has said, "This country has more problems than it deserves and more solutions than it uses."

Bernie Sanders wants us to address those problems, search for and then use those solutions.

Here are a couple of illustrations, followed by links and a video of Bernie's Iowa City presentation to fill you in on more details.

Bernie advocates "Medicare for all," otherwise referred to as "universal, single-payer healthcare." This is not some risky, radical, never-tried-before idea of his. Variations of this idea have long been the global standard, the moderate, middle-of-the-road approach by the industrialized nations for economic growth as well as better health and associated happiness for their entire populations.Those nations' peoples have longer life expectancies, and lower rates of infant mortality, than we do, with more of their people covered, and at lower cost. We chose a costly health insurance approach, although now expanded to more Americans. They chose health care provided to all.

Bernie advocates free higher education. This is no more a radical idea than Medicare for all. As I wrote last January, "Germany is only the latest country to realize that free higher education for all world citizens promotes economic growth in each of its states ("Länder"). Other countries with similar programs include Brazil, Finland, France, Norway, Slovenia and Sweden. . . . Providing free college education to all, like the free food samples at Costco, is just good business.

"Germany is part of a global economy. The more world citizens with German ties, the more the Länders' economies grow. It's true whether students from abroad stay, or return home with networks of German contacts. It's equally true of German students otherwise without access to higher education. The German economy benefits when they stay; it benefits when they study abroad, stay, and do business from there.

Iowa, unlike Germany, does not grasp this simple truth. Our leaders believe if Washington can pay for a war with tax cuts, Iowa can create prosperity with tax cuts. Both Washington and Des Moines are in desperate need of remedial math."

Nicholas Johnson, "Free College Education for Iowans? Iowa City Press-Citizen, January 16, 2015, p. A7, embedded in, "Free College Education for Iowans? Will Germany’s Economic Formula Work for Iowa?" January 16, 2015.

For more of Bernie's proposals and their details, see on his Senate Web page, Agenda for America: 12 Steps Forward"; and for a fulsome description of Senator Sanders and his positions on numerous issues, see "Bernie Sanders Presidential Campaign, 2016," "Balotpedia," and the "Political Positions" section of the Wikipedia "Bernie Sanders" entry.

If you'd like to watch Bernie explain these ideas to thunderous applause and standing ovations, here is a video of his entire Iowa City presentation, May 30, 2015, prepared by Gregory Johnson of ResourcesForLife.com:



You owe it to yourself to learn more about this man, his policy proposals and stands, and the process he proposes to get us there.

Reference Sites
Bernie Sanders' Presidential campaign Web page: http://www.BernieSanders.com

Senator Sanders' Web page: "Bernie Sanders: United States Senator for Vermont"

Bernie Sanders' Facebook page: http://www.facebook.com/berniesanders

Bernie Sanders on Wikipedia: Bernie Sanders

# # #

When Believing Is Seeing

July 14, 2014, 6:20 a.m.

Check It On Snopes
Note: For more on this subject see, "Snopes, Popes, and Presidents," December 26, 2014, and "Obama-Haters' Rhetoric and Media Responsibility," July 5, 2014.
_______________
When Believing Is Seeing

Nicholas Johnson

Iowa City Press-Citizen, July 14, 2014, p. A5
Hitler’s Joseph Goebels is credited with the strategy that, “If you repeat a lie often enough, people will believe it.” That’s deliberate lying.

More common is Mark Twain’s insight that, “It’s not what we don’t know that’s the problem, it’s what we know that ain’t so.” We’re not “lying.” We’re just repeating false information we assume is true because it’s consistent with our beliefs — something journalists are trained to guard against.

New York’s four-term U.S. Senator Daniel Moynihan famously admonished, “Everyone is entitled to his own opinion, but not to his own facts.”

But what are we to do when it is our opinion that creates our facts?

“Seeing is believing?” Yes, sometimes. But the reverse is also true: “Believing is seeing.” We tend to see that which supports our belief.

In a Yale paper last year, “Motivated Numeracy and Enlightened Self-Government,” the authors report their research finding that even scientists, highly skilled in math, make more errors when the correct math answer leads to conclusions contrary to their political orientation.

The phenomenon occurs for what we love as well as what we hate. Fans of Pope Francis are likely to believe favorable, false stories about his good deeds, however implausible (e.g., he’s slipping out at night to visit Rome’s homeless). See, “Snopes, Popes and Presidents,” http://bit.ly/1mRLzLY.

Similarly, Obama haters are equally willing to believe almost any emailed negative assertion about our “Muslim, socialist, Kenyan, imperial” president — and send it on.

Snopes.com is a wonderful online service for checking the truth of the “urban legends, folklore, myths, rumors, and misinformation” that circle the global Internet each day. So when the occasional Obama-haters’ email comes our way, we check it on Snopes.com, and kindly inform the senders if the email is untrue.

Recently came a whopper, widely circulated since January.

It was so obviously wrong on so many counts it would have been hilarious if it hadn’t been seriously libelous in its efforts to link the President — and Hillary Clinton, too, for good measure — to words allegedly authored by community organizer Saul Alinsky: “Eight steps required to create a socialist state.”

To paraphrase Senator Lloyd Bentsen’s retort when Senator Dan Quayle compared himself to Jack Kennedy during their 1988 vice presidential candidate debate, “I knew Saul Alinsky. Saul Alinsky was a friend of mine. And believe me, Sir, Saul Alinsky never wrote those words.”

Nor could Barack Obama have received the mentoring from Alinsky the email hints at, since President Obama was only 10 years old when Alinksy died. In fact, during a conversation I once had with candidate Obama about community organizing, neither of us even mentioned Alinsky’s name.

The need to oppose, and demonstrate the evil in everything President Obama has ever read, thought, advocated or done can lead to bizarre results, one of which is the email’s effort to demonize community organizing as “socialism.” It not only reveals equal ignorance regarding both, but rejects what is actually just another description of democracy.

Community organizing is the study, design, and utilization of strategies by which neighborhoods, or other groups of individual citizens, can more effectively present their grievances and proposals to governments and other institutions. These are techniques millions have proudly used since our nation’s birth, including both the Tea Party and Occupy movements during this century.

What can we do?

MSNBC’s Rachel Maddow simply tries to state the facts occasionally. Examples: “He really was born in Hawaii. And climate change is real. And rape really does cause pregnancy sometimes. And evolution is a thing. And no one is taking away anyone’s guns. And the moon landing was real. And regulations of the financial services industry are not the same thing as communism.”

You get the idea.

And for the rest of us? “Check it on Snopes or risk looking like dopes.”
_______________
Nicholas Johnson, Iowa City, maintains www.nicholasjohnson.org and the blog, http://FromDC2Iowa.blogspot.com.

For more, in the form of related research on this subject, see, Amina Khan, “‘Liberal’ or ‘Conservative’? Brain’s ‘Disgust’ Reaction Holds the Answer,” Los Angeles Times, Oct. 30, 2014 ("[F]indings, published in Current Biology, show that the brains of liberals and conservatives may indeed by wired differently — and shed light on the biological factors at play in political beliefs. . . . [M]any of the same subjects at issue in certain political ideologies – attitudes toward sex, family, education and personal autonomy, for example – have an emotional component as much as a logic-based one. And some research has indicated that political leanings can be inherited (much in the same way that height can inherited but modified, affected by a number of factors from nutrition to the environment).").

# # #

Crony Capitalism's Failures: Iowa City Style

April 8, 2013 12:13 p.m.
Gone With the Wind

"Two years ago, we were among those cheering the good news that a [wind-energy-focused] Maryland-based company — North American Ductile Iron Company (Nadicom) — had big plans to locate its first North American foundry in Iowa City . . . promising to bring 175 jobs to the area by the second quarter of 2013 . . ..

"But over the second half of last year, a good deal of wind went out of wind energy’s sails (and sales). The industry nationwide began to wobble on shaky ground . . ..

"Nadicom CEO Prasad Karunakaran recently told the Press-Citizen that . . . it’s already the second quarter of 2013, and not only are there no new jobs on the immediate horizon, but Nadicom officials basically have had to go back to the drawing board as to what type of facility would still make the best use of the land available at the park.

"At best, they won’t be able to move on anything until 2015. At worst, that starting date will be a permanent question mark."

Editorial, "'Shovel ready,' but no one's digging anytime soon," Iowa City Press-Citizen, April 8, 2013, p. A7.

The State of Iowa and City of Iowa City bet $14.2 million of your money and mine on this gamble -- without checking with us first. Now it looks like we'd all be better off if they'd just taken that money to the Riverside Casino and tried their chances.

"Tough TIF Talk" outlines 20 categories of reasons why this kind of "business deal" with taxpayers' money is a bad idea.

Today's Press-Citizen editorial is a classic example of just one of those categories: "All ventures have risk. TIFs have more, because public officials with little business experience and no skin in the game make more mistakes than experienced investors watching their own money."

The Nadicom venture discussed in the editorial also fails most of the other 19 categories of reasons why corporatism is a bad idea. But this blog essay is just going to concentrate on that one.

As the editorial reports, the City spent "$2.4 million [of taxpayers' money] to purchase 173 acres" for Nadicom. Believing that to be insufficiently generous, it then passed along an additional "$9.5 million to extend roads and utilities," following which the State, feeling flush as well as generous with other people's money, chipped in "$2.3 million for rail and additional road work."

The road to "economic development" is littered with billions of wasted taxpayers' dollars -- federal, state, county and city taxpayers' dollars. Thousand of projects that may have once looked promising to politicians end up belly up. Capitalism is supposed to meet our economy's needs with the ventures of private investors -- individuals who are willing to risk the possibility of great loss because of what they see as the probability of great gain.

Bear in mind, I'm not objecting to this project. I think renewable energy resources are the Planet's only long term hope. I don't object to permitting clean industry to locate in and around Iowa City -- the right projects, in the right locations. I'm not worried about the shadow Nadicom's structures would cast over Scott and Highway 6.

Indeed, if there was no taxpayer money involved I would not even complain about a failed business. After all, roughly half of all new businesses fail within their first five years. As has been said of Silicon Valley's hopefuls, "in this California cradle of Internet startups . . . failure is accepted, or even welcomed, as a guide for future success." Failcon.

No, my concern has to do with the risks for taxpayers when our local officials do the equivalent of taking our money to the Riverside Casino and gambling it away; and then, when questioned, try to justify what they've done by saying (a) it creates jobs, and (b) "Gee, you know, we might even have won." When governments are cutting the investment of public dollars in legitimate, traditional public functions of benefit to all Americans -- in the name of "cutting taxes" -- is no time to be gambling with those very same tax dollars, betting on private ventures that ought to be funded with private dollars.

And that's just ONE of the 20 categories of what's wrong with corporatism (the blending of government and business). Read the other 19 in "Tough TIF Talk." Go down the list. Can you honestly tell me you disagree with every single one of those 20 categories of reasons why crony capitalism is a bad idea?

# # #

Tough TIF Talk

February 3, 2013, 10:20 a.m. [Looking for the Feb. 1 "Pat Paulsen on Guns" blog entry? Click here.]

Like Death and Taxes, TIFs and TIFing Seem Here to Stay

Nicholas Johnson

Iowa City Press-Citizen

February 3, 2013, p. A7

Considering all the downsides of tax increment financing (TIF), you have to wonder why public officials continue to use it. Is there that much joy in playing Santa with other people’s money?

Whatever the reason, like death and taxes TIFs are here to stay. Officials and their lucky beneficiaries love them, and the public doesn’t seem to care — at least not enough to make an organized, political difference.

Nonetheless, it’s worthwhile to remind ourselves from time to time why they are such a bad idea. Here’s a summary.

• Roads and schools are traditional government undertakings. Funding private enterprise is not.

• TIFs are backwards: voters must approve bonds for legitimate public projects, like the justice center, but private TIFs are awarded without public approval, often over taxpayers’ objections!

• They’ve lost their way. Initially designed for urban renewal and low-income housing, taxpayer-funded TIFs are now used to build upscale condos.

• It’s ideological hypocrisy to praise free markets while coming to city hall tin cup in hand.

• Telling taxpayers, “I’ll keep the profits, you cover the losses,” conflicts with capitalism’s gamble of risks as well as rewards.

• TIFs intertwine government and business in something that’s neither socialism or capitalism. It’s called “corporatism,” and combines the worst qualities of both.

• TIFs distort the market.

• Even if distortion of market forces was desirable, governments have more effective tools than TIFs that don’t require taxpayers’ money — zoning regulations and building codes among others.

• It’s inexcusably unfair to fund one business person while leaving his competitors on their own.

• TIFs take money from schools and other government units, causing either cuts in programs or increased taxes.

• Even if TIFs would produce taxes many years from now, and they often don’t, are ever-increasing taxes (and budgets) an appropriate metric for measuring good government?

• TIFs aren’t needed. There are plenty of investors for sound, profitable business plans. If they and bankers won’t fund a project, why should taxpayers?

• Many TIFed projects would have gone ahead anyway; it’s virtually impossible to know if the beneficiary’s professed “need” is genuine.

• All ventures have risk. TIFs have more, because public officials with little business experience and no skin in the game make more mistakes than experienced investors watching their own money.

• Trying to move businesses from one community to another with competing TIF bribes is a lose-lose strategy.

• Businesses pick cities for reasons other than TIFs: workforce, local economy, schools, transportation, communication, quality of life.

• Telling officials to TIF “prudently” is as effective as beer ads urging University of Iowa binge-drinking students to “drink responsibly.” TIFs can be as addictive as alcohol.

• When officials give millions in taxpayers’ money to private, for-profit businesses, the temptations for good-old-boy corruption are great — and virtually impossible to uncover.

• TIFs are, for a taxing authority, what impulse buying is for the rest of us — an expensive, unbudgeted, one-off “I’ve got to have that!” moment, often followed by buyer’s remorse.

• TIFs can devastate a government’s credit rating, thereby increasing the cost of future legitimate projects.

These concerns are relevant for any city.

But Iowa City has another reason to avoid TIFs: We don’t need them. Businesses here will thrive; others come because of what we offer. We’re ranked near the top of the nation’s cities in numerous categories.

I know our officials will continue dropping millions of taxpayers’ dollars to the bottom line of for-profit, private ventures. But it still doesn’t hurt to ask from time to time, “Why?”
__________
Nicholas Johnson, a former school board member, teaches at the University of Iowa College of Law and maintains www.nicholasjohnson.org.

# # #
For discussion of the taxpayer subsidy of a previous Moen project, along with footnote documentation, and links to a sampling of other prior TIF discussions, see "TIF Towers; Giving TIFs the Sniff Test."

The True Price of TIFs

October 1, 2011, 7:20 a.m.

Thank You Press-Citizen and Emily Schettler . . . but that's not all
With two stories about TIFs in Saturday's paper, the Iowa City Press-Citizen, and its reporter, Emily Schettler, have made a significant contribution to the people of Iowa in general, and Johnson County in particular. This is reporting in the best spirit of "civic journalism." Emily Schettler, "The Many Faces of TIF; Districts Offer Incentives as Well as Drawbacks," Iowa City Press-Citizen, October 1, 2011, p. A1; Emily Schettler, "What Impact Do TIFs Have on County, Schools?" Iowa City Press-Citizen, October 1, 2011, p. A1.

There are 13 categories of reasons why TIFs are usually, if not always, a bad idea that do significant harm to business, government, elected public officials -- and, of course, taxpayers. [Photo credit: Benjamin Roberts/Iowa City Press-Citizen]

One of those categories is the subject of this two-story presentation: how TIFs can tie the hands of the governmental unit that creates them (and otherwise exact high "opportunity costs"), lower its credit rating for government bonds, deprive neighboring governmental units of needed tax revenues, and related consequences.

Here is a summary presentation of another 12 categories of reasons why they should be avoided:

TIFs are not necessary for Iowa City and surrounding communities. We're not exactly going through a depression, with store fronts boarded up, unemployment around 40%, or other justifications for early New Deal-type programs.

Their "opportunity costs" are enormous for local property taxpayers and local governments. County Supervisor Rod Sullivan estimates they are currently taking some $700 million worth of business property off the tax rolls. That means both more taxes for the rest of us and cuts in needed programs.

TIFs tilt the playing field, are unfair to business, and cause imbalance in the free market. Why the business community doesn't rise up in righteous wrath over TIFs has always amazed me. It's tough enough out there in that free market jungle, what with competition from the likes of Wal-Mart and comparably advantaged businesses, government regulations that sometimes seem a wee bit irrational, and the unforeseeable challenges. It just seems so fundamentally unfair that, on top of all that, a business person should have to compete with someone who is handed the kind of competitive advantage represented by a TIF or other government subsidy. Talk about a "level playing field"! TIFs really upset a smoothly working free market -- and to no one's real advantage except for the lucky recipient of the taxpayers' largess.

There's no evidence that Iowa City's economy and development won't continue to expand at a satisfactory rate driven by nothing more than the forces of the marketplace -- entrepreneurs, investors, venture capitalists, banks and other loaning institutions.

TIFs (and other shifts of taxpayers' money to for-profit enterprises) don't work. Governor Vilsack offered Maytag $100 million in taxpayers' money not to leave Newton. It went to Michigan anyway. Should he have offered $200 million? I don't think so.

Business comes to an area for other reasons than TIFs: available skilled workforce, transportation, communications, and other infrastructure elements -- plus "quality of life" assets such as schools, parks, libraries, theaters, trails, entertainment venues, restaurants, and natural settings such as mountains, beaches, woods, rivers and lakes. (A business that came to an Iowa Mississippi River town recently explained that it didn't choose the location because of state subsidies, it chose the location because it needed access to barge transportation on the river.)

Transferring taxpayers' money to for-profit ventures in the name of "free private enterprise" carries so much hypocrisy that City Councilors who talk that way ought to hide in the shadows with their shame. Where's the ideological purity of these "greed is good," privatization, "let the marketplace do it all" pro-business advocates when they're holding out (or filling) a tin cup? Business proposals that make sense have no trouble getting funding; owners, investors, venture capitalists, and creditors are looking for places to put their money and will respond to well-crafted business plans. Free private enterprise ventures can make sense for a community. So can socialist ventures such as roads, schools, libraries and parks. However, the more they are kept distinct the better it is for both.

If free private enterprise can't fund a project with private sector money, that just might be a sign that it's not a very good place to be putting the public's money either.

How can one possibly judge with accuracy whether, if the TIF were not available, the project would not go ahead? When free public money is available to a for-profit venture the temptation to become a tough negotiator, and to just slightly misrepresent the facts, is overwhelming. And there's virtually no way to test the blackmail.

The TIF-granters' record ain't great. For the most part, the public officials handing out our tax dollars to the wealthy are more professionally skilled at keeping constituents (and campaign contributors) happy, getting re-elected, and moving up to higher office, than they are at evaluating business proposals. There is a long list of TIFed (or otherwise publicly subsidized) private projects that have gone belly up, or failed to meet their promised construction schedules, or goals for new employees at designated pay levels.

Will we lose some businesses if we don't offer TIFs? Maybe. Let other towns give away their taxpayers' money. We don't need to play their game. As one of the top-rated towns in the nation by any one of a number of measures we'll get our share of new businesses without offering TIFs. Have a little self-confidence. Vilsack's $100 million couldn't keep Maytag here. A firm that likes San Diego's climate, or port access to the Pacific Ocean, probably isn't going to come to Iowa City for a TIF. A firm that believes it needs a location giving it rapid access to the O'Hare airport in Chicago (whether for moving persons or cargo) probably can't be talked into using the Iowa City-Cedar Rapids "Eastern Iowa Airport" no matter how big the TIF.

Step up to the plate councilors and business community. If City Council members, or members of the business community, think we need more economic growth and development than the marketplace can provide on its own there's nothing to stop them taking up a collection or offering personal economic incentives to new businesses. Iowa City's banks could offer new businesses, or proposals for business expansion, reduced-rate loans. The business community could create its own venture capital fund to invest in, or loan to, business developments they thought worthy. And I'm sure they'd be more than happy to accept every dollar from a City councilor who would like to help out.

Excerpt from "The Terrible TIFs," July 26, 2011. And see also, "Brother, Can You Spare a TIF?" April 25, 2011; "Understanding TIFs," October 5, 2006.

And see especially the 41 citizen comments (as of now) on yesterday's Press-Citizen story, Josh O'Leary, "Hampton Inn eyes I.C. spot; Hotel could be first piece of Riverfront Crossings," Iowa City Press-Citizen, September 30, 2011.

Reconsidering the Proposition That "All TIFs Are Evil"

Is it possible that describing all TIFs as "evil" is a bit of a stretch -- depending on your sense of evil? Would "all TIFs are outrageous" be a little more restrained?

Is it even possible, like being "just a little bit pregnant," that there are some very modest, or at least very precise, uses of TIFs that make sense for everyone?

Never before has that possibility come from my lips. But recent conversations with experienced and knowledgeable, independent individuals whose wisdom and judgment I value -- and who are opposed to TIFs in general -- have caused me to rethink it. I'm not convinced, mind you; I don't yet have enough information to even reject the idea, let alone accept it; all I'm saying is that my mind is open to considering the possibility.

So far, the conversations have been relatively superficial (only because we haven't had the time to pursue the issue in greater depth).

The general idea, if I understand it, is that TIFs can sometimes produce a public benefit in a for-profit venture that, but for the TIF, would not exist. I haven't yet been given specific examples, but my guess would be this might include such things as a greater set-back creating more open, green space, or intermixed low income housing, or more parking spaces.

The theory might be that this is but piggybacking a public goal on top of a private undertaking -- a public goal that would otherwise require the governmental unit to undertake the entire cost of the project. This would thus be somewhat akin to the government contracting with a private trash pickup service, or a private road builder to fill potholes -- public money may be going to help enrich a for-profit business, but that money is purchasing a public benefit that would otherwise have cost more.

(Note the emphasis on public benefit. Public schools, libraries, parks, and trails may help attract business to a community; after the business arrives, its employees will benefit. The point is, so will everyone else in the community. On the other hand, providing TIFs and subsidies, water and sewer lines to a new manufacturing plant -- or roads traveled almost exclusively only by the plant's employees -- do not have as direct a benefit to every taxpayer and citizen in the community.)

My first reaction to this argument is one of the 12 categories above: "How can one possibly judge with accuracy whether, if the TIF were not available, the project would not go ahead?" It may be no government intervention of any kind is required to get the benefit.

Second, if there were a way of definitively proving that is not the case, state, county and municipal governments have rather substantial regulatory power in the form of statutes, ordinances, agency regulations, fire and building codes, and zoning. So far as I know, it is not common for governments to subsidize, or provide tax breaks, to gain the public good of building materials and electric wiring less likely to burst into flame, restaurants' kitchens less likely to house rats and cockroaches, or rental housing fit for healthy living.

At a minimum, when governments are in pursuit of the public good in for-profit enterprise, I would like to see them totally exhaust all other possibilities for bringing about the end they desire before paying for it with taxpayers' money in the form of TIFs, other tax forgiveness, subsidies, and cash payments.

One of my trusted advisers tells me that, while my rule would certainly be preferable, it is often impossible to get the votes of legislators or city council members for that approach. I am quite willing to have conversations about political reality and corruption, but it does not seem to me that such considerations bear upon the inherent virtues and vices of TIFs as such. And I'd like to get the theoretical understanding of TIFs straight first, before getting into debate about necessary political compromises.

Third, so if (a) a desirable public benefit can be identified that is viewed by the public as a top priority, and (b) it can somehow be proven beyond a reasonable doubt that the marketplace won't create it without taxpayer money, and (c) the governmental unit has no legislative or regulatory way to insist on the benefit without paying for it, and (d) it doesn't make sense for the governmental unit to undertake the entire benefit-producing project on its own (government planned, constructed, managed and operated), then (d) before pledging any public money to the project (TIF or other tax forgiveness, subsidy or cash) what I am looking for is some predictable, analytical,check list of questions, benefit-cost, structured way to evaluate which projects clearly do, and do not, qualify for public financing, and why.

A somewhat analogous approach, in an entirely different context, is what's called "the Powell doctrine," the questions one needs to address before concluding that involving the military in a matter of our foreign relations will be more constructive than destructive of our national interests. See, e.g., "War in Libya, the Unanswered Questions," March 23, 2011.

So that's it for now. I've yet to see a TIF I thought made sense, a TIF for which none of the 13 categories of objections was applicable. I am impressed with the overwhelming majority of my fellow citizens (who have expressed views in comments on the Press-Citizen stories and other TIF projects earlier) who seem to share not only my general conclusions, but the precise arguments (categories) I have put forth. My mind is open to considering data and arguments regarding a small category of exceptions. But I have yet to see the standards that would be used to qualify those applications.

# # #

The Oxymoron of "Corporate Responsibility"

July 16, 2010, 9:00 a.m.

[For BP disaster see, "Uncanny Prediction of BP Disaster & Response," June 10, 2010; "BP's Commercial: Shame on Media," June 9; "Big Oil: Calling Shots, Corrupting Government," May 26, 2010; "Obama As Finger-Pointer-In-Chief," May 18, 2010; "Big Oil + Big Corruption = Big Mess," May 10, 2010; "P&L: Public Loss From Private Profit," May 3, 2010.]

Corporate Risk Assessment and Inevitable Disaster
(bought to you by FromDC2Iowa.blogspot.com*)
Sat next to a business consultant on a recent flight. Got to talking about Massey and BP. His contention: It's all just about risk assessment. However conscious and precise we may be about the process (whether we're driving a car or drilling miles beneath the ocean's surface), it goes something like this: What are the potential rewards from our risky behavior? What are those risks? How serious would it be if the worst occurred? What is the likelihood it will occur? (Perception of risk -- or more often mis-perception -- is another matter, as when someone fears flying (despite the relatively slight risk) but continues smoking (despite its almost inevitable risks).) Anyone in business is under enormous pressure to both increase profits and decrease costs; in other words to gradually assume ever increasing risks of harm -- to employees, customers, the environment, or the global economy -- until the inevitable disaster occurs.

Goldman Sachs. "Goldman Sachs has agreed to pay $550 million to settle federal claims that it misled investors in a subprime mortgage product as the housing market began to collapse . . .." Notwithstanding the payment, "Goldman did not formally admit to the S.E.C.’s allegations . . .." Now, how credible is that stance? You don't admit to any wrongdoing, but you pay the $550 million fine anyway? Even if you earned over $13 billion, $550 million is a little more than one normally pays to settle a nuisance suit. Moreover, Goldman Sachs "agreed to a judicial order barring it from committing intentional fraud in the future . . .." What a concession from a Wall Street firm! That really stings, and should substantially cut into their future profits. Wow, agreeing to forgo the ability to engage in "intentional fraud." Sewell Chan and Louise Story, "S.E.C. Settling Its Complaints With Goldman," New York Times, January 16, 2010, p. A1.

When grief or anger become seemingly unbearable, we sometimes redirect it into humor. So it is with Harry Shearer's catchy, bouncy, "Mr. Goldman and Mr. Sachs" ("spinning gold out of flax, Mr. Goldman and Mr. Sachs"). Give it a listen; available from Amazon and iTunes.

Massey Coal. It's now come to light that Massey Coal (in whose mine 29 miners died last April) has deliberately applied its risk assessment analysis to miners' safety.

An NPR News investigation has documented a dangerous and potentially illegal act at the Upper Big Branch mine in West Virginia two months before a massive April explosion killed 29 mine workers.

On Feb. 13, an electrician deliberately disabled a methane gas monitor on a continuous mining machine because the monitor repeatedly shut down the machine.

Three witnesses say the electrician was ordered by a mine supervisor to "bridge" the automatic shutoff mechanism in the monitor.

Methane monitors are mounted on the massive, 30-foot-long continuous miners because explosive gas can collect in pockets near the roofs of mines. Methane can be released as the machine cuts into rock and coal. The spinning carbide teeth that do the cutting send sparks flying when they cut into rock. The sparks and the gas are an explosive mix, so the methane monitor is designed to signal a warning and automatically shut down the machine when gas approaches dangerous concentrations.

Howard Berkes, "Massey Mine Workers Disabled Safety Monitor," NPR, July 15, 2010.

There was a risk. But it would result in greater production -- and profits. A worst case scenario was possible, but not inevitable. Sometimes they got away with it. This time they didn't.

BP. BP didn't get away with its cost-saving risk either. By now, everyone's familiar with BP's risk assessment process. The prior blog entries on that one are linked at the top of this blog entry. That company has so often weighted potential cost savings over risks to worker safety and environmental disaster that it amasses hundreds of safety violations (including the Artic spill and Texas City) when other oil companies have less than a handful.

GlaxoSmithKline's Avandia (rosiglitazone). Public Citizen's Health Research Group reports,

3.1 million prescriptions [for Avandia] were filled in 2008. But Avandia is associated with heart failure, heart attacks, liver toxicity, bone fractures, low red blood cell count and macular (retinal) edema with vision loss.

Public Citizen petitioned the FDA to revise the labeling for Avandia due to multiple safety issues in 2000. In 2007 a study published in the New England Journal of Medicine associated the drug with a 43 percent increase in the risk of heart attacks.

"Avandia," Public Citizen Health Research Group.

As an indication of the ties between the FDA and the pharmaceutical industry, as well as the complexities of risk assessment, an FDA advisory panel recently voted 20 to 12 to recommend that GlaxoSmithKline should be permitted to continue to profit from the millions of pills. A vote of 20-12 on such a death risk reminds me of my days on the seven-person FCC, when we would vote 4 to 3 to send a colleague a get-well card. Bear in mind, this same FDA committee, by a vote of 21 to 4, agreed not only that Avandia carries a risk of death from heart attack, but that the risk is much higher from Avandia than from alternative medicines that could be used instead. Matthew Perrone, "FDA Panel Votes to Keep Avandia On the Market," AP/MSNBC, July 14, 2010.

Have you seen the latest commercial for Avandia? The list of side effects goes on seemingly forever. I don't think a diabetic should "ask your doctor if Avandia is right for you," I think if a doctor recommends it diabetics should "ask yourself if your doctor is right for you."

Other examples. These are only the most recent examples. There are hundreds of others. A couple that spring immediately to mind are Bhopal (Union Carbide chemical spill; 500,000 exposed, 15,000 killed) and Three Mile Island (partial core meltdown of Babcock & Wilcox nuclear reactor).

That the U.S. electric utilities chose to save money by managing the nation's electric grid through the Internet, rather than a more secure system, is a monumental calamity just waiting to happen. Siobahn Gorman, "Electricity Grid in U.S. Penetrated by Spies," Wall Street Journal, April 8, 2009, ("Cyberspies have penetrated the U.S. electrical grid and left behind software programs that could be used to disrupt the system, according to current and former national-security officials.").

And see generally, Nicholas Johnson, "'The Corporation' and the Search for Agreement," October 1, 2004 (a commentary prompted by the film "The Corporation").

Obama as "socialist."

Meanwhile, the Tea Party has TPed a Mason City billboard as the organization's own Mount Rushmore, likening President Obama to Hitler and Lenin and indicting the three of them as socialists. Jennifer Jacobs, "Iowa Politics Insider: More Fallout From Obama/Hitler Tea Party Billboard," Des Moines Register, July 15, 2010.

As for "Leaders Prey on the Fearful & Naive" slug at the bottom of their billboard, I'd suggest the TP folks take a look in the mirror, and a second look at those they follow on radio and TV, and as speakers at their rallies.

I won't write at length about the TP's choice and characterization of Hitler and Lenin. Obviously, they have been chosen as characters to despise, in the Republican/TP's efforts to do everything they can to make Obama fail (as they have openly acknowledged). Never mind that if he fails, America fails.

Frankly, each of the disasters noted above have involved not socialism -- government ownership of means of production -- but a form of fascism, fascist corporatism, or more simply put, political corruption, the domination of political and regulatory institutions by large corporations. "Agency capture," to a lesser or greater degree, was a factor in each of the noted disasters.

Indeed, if only Obama were a socialist we would have long since clawed our way out of the global economic collapse brought on by Goldman Sachs and others. When 80 percent of our economy is driven by consumer spending, unemployment (including that which is not reported) runs closer to 20 than 10 percent, and consumers are, not irrationally, saving rather than spending, you can't create an economic turn-around by giving money to corporate executives and calling it a "jobs program."

Darkening consumer confidence and plunging prices combined with a generally dismal outlook to dampen hopes for a quick economic recovery. . . . "Consumers are facing three major hurdles," Art Hogan, chief market strategist at Jefferies & Co., said in an interview. "They are paying down their debt, their houses are not worth as much as they were two years ago and they're staring down the barrel of 10 percent unemployment." . . . Taken together, the week's economic data suggest that a global recovery will be staggered and sluggish in getting off the ground. Consumers -- the engine of the U.S. economy -- are catching few breaks.

Frank Ahrens, "Drops in Consumer Confidence, Prices Temper Recovery," Washington Post, July 15, 2010.

Businesses won't provide additional employment until they see a reason to increse production. There's no reason to increase production unless consumers are going to spend. Consumers aren't going to spend if they're concerned they, too, may soon be unemployed.

"Trickle down" never works, but especially not at this time. What we need is trickle up.

If Obama were a socialist he would have created a federal, employer-of-last-resort, jobs program that would have immediately (FDR's programs were in place in a month) put everyone on a payroll. Give the unemployed a job, the confidence they won't be fired, and the money that goes with it, and they'll use the money to buy stuff they need, not increase their savings accounts. Their purchases will require increased production; increased production will increase private sector employment. Gradually those on the federal payroll will be picked up by private employers.

Now that's a real jobs program. Recession reversed; global economic collapse averted. Corporations profiting from their business sense, not their political dollars -- and our taxpayer bailouts of the wealthy. See generally, "Unemployment Answer is Jobs Not Bailouts," February 6, 2010.

What the TPers ought to get angry about (and, in fairness, to some extent do) is a "capitalism" in which successful businesses keep all of their profits, and unsuccessful businesses pass their losses on to the taxpayer. "Heads I win, tails you lose."

"Socialism" is the Interstate highway system, public schools, libraries, museums, local police and fire protection, the military, and a national, state and local system of parks. I kind of like that socialism, and feel that it often provides me a greater return on my investment of taxes than what I sometimes end up with from the capitalists.

How ironic that the TPers would choose "socialist" as one of their favorite pejoratives for Obama, when he is, apparently, one of the few Americans who appears to be even more frightened of the word than they are.
_______________

* Why do I put this blog ID at the top of the entry, when you know full well what blog you're reading? Because there are a number of Internet sites that, for whatever reason, simply take the blog entries of others and reproduce them as their own without crediting the source. I don't mind the flattering attention, but would appreciate acknowledgment as the source -- even if I have to embed it myself.
-- Nicholas Johnson
# # #

Socialism, Public Option, Obama and Health Care

August 17, 2009, 5:30 p.m.

General Semantics Meets "Socialized Medicine"
(brought to you by FromDC2Iowa.blogspot.com*)
The news that we're not only not going to get the system of "universal, single payer" health care that every other industrialized country offers its citizens, we're not even going to get the watered down "public option," comes as no great surprise, but as a great disappointment nonetheless.
Sheryl Gay Stolberg, "‘Public Option’ in Health Plan May Be Dropped," New York Times, August 17, 2009.

What it means is that we're not even going to get health care, we're going to get health insurance. There's a big difference. As Congressman Dennis Kucinich often says, "I don't want every American to have health insurance, I want every American to have health care."

There are many things the free market, competitive, for-profit corporate system does not only well but efficiently. Keeping Americans healthy is not one of them.

* Fast food chains can sell more, have higher profits -- and stock prices -- by fattening up Americans, selling the various combinations of sugar, salt and fat that encourage our eating more -- as well as promoting diabetes and obesity -- than from fruits and vegetables.

* There's more profit from processed foods that keep forever than from fresh produce that spoils.

* More profit from the sale of automobiles (and their associated expenses) than from bicycles.

* More from beer and other alcohol than from V-8 juice or tap water.

* And it all comes to us in the sea of multi-billion-dollar advertising through which we must swim.

* Pharmaceutical companies advertise prescription drugs to potential patients -- who are legally prohibited from buying them ("illegal drugs") -- for the same reason toy companies advertise toys to children who don't have the money to buy them. Toy companies know that children will put pressure on their parents; Big Pharma knows potential patients will, with equal success, put pressure on their doctors -- doctors who might never have prescribed the high-profit drug (as heavily advertised drugs tend to be) without that patient's insistence.

It stands to reason that a heavily advertised "labor saving" lifestyle promoting as little exertion and exercise as possible, coupled with a nutritional food source that is not good for us, will end up producing more obesity, heart disease, cancer, stroke and diabetes -- among other things -- that will require medical and hospital care.

And who do we look to for the cure? The sickness lobby.

Sickness insurance companies don't increase profits by paying policy holders' doctor and hospital bills. They increase profits by not paying claims, contesting and refusing legitimate bills, refusing to insure those likely to have above average costs, and dropping those enrollees who do have high costs -- and by doubling our premium payments every few years. As a result some 47 million Americans have no coverage at all. Their only option is hospital emergency rooms that run up costs that are multiples of a doctor's visit -- costs that are then shifted to the rest of us in the form of higher bills than what we'd otherwise get, and ultimately even more increases in our premiums.

It is the sickness insurance industry that has created our problems. Why on earth would we turn to it, of all potential saviors, to solve the problems? It's nuts. It's like asking convicted child molesters to guard our children's playgrounds.

But it's also the way Washington works.

Following his comment about disparity of earnings among Americans, Warren Buffett was asked if he wasn't talking "class warfare." He replied along these lines: There's class warfare, all right, but the war is over and my class won.

Or as the old adage, rewriting the even older Golden Rule, has it: The Golden Rule is that them that has the gold makes the rules.

An industry willing to spend $1.3 million a day lobbying Congress, and willing to be among the most generous sources of campaign contributions, can prevent even a puny "public option" from coming into being.

And what's the argument of the public option opponents? As Stolberg reports, "opponents denounce him [President Obama] for promoting “'socialized medicine.'”

Put aside the revealing irony of the reported comment of a town meeting protester, "Keep your government hands off of my Medicare" and the fact that we already have a good deal of "socialized medicine": Medicare, Medicaid, medical services for those in the military and VA hospitals for those who once served, and the sickness insurance benefits for government employees (local, state and federal). That's a lot of "socialized medicine," folks. It's not like, if only you can defeat the public option proposal you will have rid America of socialized medicine.

"Socialism" is defined in Dictionary.com, as modified for our purposes, as "a theory or system . . . that advocates the vesting of . . . ownership and control . . . in the community as a whole." The Wikipedia entry says, "Economically, socialism denotes an economic system of state ownership . . .."

I use these definitions because to talk of "socialized medicine" suggests government ownership of a particular function -- not a "socialist society" or "socialist economy" in which all means of production are owned by the state.

When lecturing to business crowds I have occasionally asked the audience, with a show of hands, how many consider themselves "socialists." Usually not a single hand goes up. I then ask, "How many of you drove here today? [Most hands go up.] How many drove on Interstates [inserting the numbers of the local Interstate highways]? [Most of the hands stay up.]" I then ask, "Did you realize you were driving on a socialist highway? Now that you know that, does it trouble you?"

"Socialism" is, for many, an emotionally charged word, an expletive, a swear word you might say. During the 1950s era of Senator Joseph McCarthy the word "communist" carried even more opprobrium -- along with "fellow traveler," "red," and "pinko." "Liberal" has come to carry similar connotations for many today. Such words are conclusory -- they remove the possibility of any additional meaningful conversation, and certainly any further rational analysis. They are used to describe something the speaker believes has no redeeming qualities, something perhaps even indisputably "evil."

Given the American experience, which is clearly a mixed public-private economy, it doesn't make much sense to use the word "socialist" from a descriptive or analytical perspective -- however politically expedient it may be in weakening President Obama, strengthening the Republican Party for next year's elections, or merely defeating any health care reform legislation.

There are so many "government-owned, socialist" enterprises in this country that are something between widely accepted and even celebrated, such as our history of public ("socialist"): libraries, K-12 public schools, National Parks (as well as state, county and city parks), Interstate highways (plus state, county and city roads), the military, Medicare and Medicaid -- essentially every program funded by any governmental unit.

We can be proud of our nation's generally rational, practical, pragmatic approach to these questions. For example:

* Monopolies and quasi-monopolies can be "privately owned," in a sense, but may have their rates, rate of return, and business practices regulated (as with broadcasting stations and the FCC -- at least from the 1920s to the 1960s).

* The Tennessee Valley Authority, and Hoover Dam, are examples of a "public option," offering a benchmark, an alternative, to private power.

* Social Security is a socialized retirement system.

* Barge traffic on the Mississippi, and flood control, are made possible by the Army Corps of Engineers -- as airline operations are made possible by the FAA's air traffic controllers.

* Highways may be "owned" by government, but they are built by private contractors enlisted by the government from the marketplace.

* At least some defense contractors might as well be "government owned," given the large percentage of their cash flow that comes from taxpayers.

* Publishers are given discounts on subsidized rates for books, magazines and newspapers.

* Have we "socialized" agriculture by providing price supports and subsidies?

* Some cities own their cable television systems.

* We have government involvement in the economic model called cooperatives, such as the role of the early Rural Electrification Administration, Rural Electric Co-ops, and the current proposed alternative to the public option.

* And the tax code is riddled with so many special breaks for individual companies and industries that is resembles Swiss cheese.

There seems to have been no limit to the thousands of mix-and-match combinations of economic models we've tried.

Our approach has clearly been pragmatic rather than purist. We have not cared whether a given approach was called "socialist" or "capitalist." What we cared about was getting the best combination of economic models -- in a given instance and throughout the entire economy.

That's what we ought to be doing now with health care. This is no time for ideology, for using "socialist" as an expletive. It's time to help the American people regain their health, and not have to risk bankruptcy when they're sick.
____________

* Why do I put this blog ID at the top of the entry, when you know full well what blog you're reading? Because there are a number of Internet sites that, for whatever reason, simply take the blog entries of others and reproduce them as their own without crediting the source. I don't mind the flattering attention, but would appreciate acknowledgment as the source, even if I have to embed it myself. -- Nicholas Johnson

# # #