Research and Commentary on Policy & Politics in Suport of Greater Economic Equality and Social Justice

Capitalist Fools by Joseph Stiglitz

April 2, 2010  |   Politics and Policy

Capitalist Fools by Prof. Joseph E. Stiglitz   Behind the debate over remaking U.S. financial policy will be a debate over who’s to blame. It’s crucial to get the history right, writes a Nobel-laureate economist, identifying five key mistakes—under Reagan, Clinton, and Bush II—and one national delusion. There will come a moment when the most urgent threats posed by the credit crisis have eased and the larger task before us will be to chart a direction for the economic steps ahead. This will be a dangerous moment. Behind the debates over future policy is a debate over history-a debate over the causes of our current situation. The battle for the past will determine the battle for the present. So it's crucial to get the history straight. What were the critical decisions that led to the crisis? Mistakes were made at every fork in the road-we had what engineers call a "system failure," when not a single decision but a cascade of decisions produce a tragic result. Let's look at five key moments. No. 1: Firing the Chairman In 1987 the Reagan administration decided to remove Paul Volcker as chairman of the Federal Reserve Board and appoint Alan Greenspan in his place. Volcker had done what central bankers are supposed to do. On his watch, inflation had been brought down from more than 11 percent to under 4 percent. In the world of central banking, that should have earned him a grade of A+++ and assured his re-appointment. But Volcker also


Corporate Consolidation: Some Facts and Figures

April 2, 2010  |   Paul Crist

 Time to enforce, and strengthen, antitrust laws! Corporate Consolidation:  Some Facts and Figures By Spencer Windes on Feb 09, 2010 There has been a frightening trend towards corporate consolidation in the last few decades. Here are some troubling facts. Agriculture: From thousands of seed companies and public breeding institutions three decades ago, 10 companies now control more than two-thirds of global proprietary seed sales. The proprietary seed market (that is, brand-name seed subject to exclusive monopoly – i.e., intellectual property), now accounts for 82% of the commercial seed market worldwide. From dozens of pesticide companies three decades ago, 10 now control almost 90% of agrochemical sales worldwide. Biotech: From almost 1,000 biotech start-ups 15 years ago, 10 companies now account for three-quarters of industry revenues. Pharma: The top 10 pharmaceutical companies control 55% of the global drug market. In 2009 Merck and Schering-Plough merged to create Merck-Schering-Plough (a $41 billion cash and stock deal), just weeks after Pfizer bought Wyeth for $62 billion, maintaining its position as the #1 drug company in the world. The remaining big players (Roche, Johnson & Johnson, Sanofi Aventis, Glaxo) will most likely be forced to buy up smaller firms or seek mergers if they want to compete. Food: In raw foodstuffs, mergers among the nation’s largest grain firms — including Cargill’s acquisition of Continental Grain, and ConAgra’s purchase of Peavey and Standard Milling — contributed to giving four firms control over more than 60 percent of the nation’s grain business. In meatpacking, ConAgra’s acquisitions


Senate Financial Reform Bill: A Review of the Key Proposals

April 1, 2010  |   Paul Crist Politics and Policy

Senate Financial Reform Bill: A Review of the Key Proposals By Paul Crist March 28, 2010 The Financial Reform Bill introduced by Sen. Christopher Dodd (D-CT) appears to be, on the whole, a decent piece of legislation.  There are good arguments why various aspects may be weaker than they should be, but given the political landscape, Dodd has come up with a bill that ought to garner broad support from across the spectrum.   It is widely recognized that the need for reform is urgent, and given the level of public anger toward bankers and the financial sector generally, fairly swift passage of this bill should be possible.  After all, are there 41 Senators willing to stand up and side with the bankers?  That would be very hard to explain to the constituents back home. The bill is comprehensive in that it covers many issues, and detailed, with over 1,100 pages of regulatory reforms.  Assessing every issue in detail would be a daunting task (but somebody’s gotta do it).  But there are a range of specific areas that deserve consideration and comment.  The following issues will be briefly addressed here: The proposed Financial Stability Oversight Council (FSOC) and curbing industry influence over regulators; The proposed Consumer Financial Protection Agency (CFPA); Enhanced resolution authority and the “too-big-to-fail” problem; Proposed changes in the division of regulatory authority; Proposed regulation over trading of derivatives, asset-backed securities, and hedge funds; Proposals for financial brokers, investment advisors, and credit rating agencies.   Financial Stability Oversight Council


The Real Message in the Massachusetts Special Election

January 20, 2010  |   Politics and Policy

The more I think about this Massachusetts election outcome, the more I am concerned... but not about the Democrats.  I worry for the Republic.  I think both parties are in much deeper trouble than their leaders realize.  And that spells trouble for the Republic. Why? America has become ungovernable.  Every election is about "throwing the bums out," no matter who's in the majority.  Seems to me we have a major populist shift in attitude in the country, with no populist leadership coming from either party, because they're both in thrall to their corporate masters. Candidates talk a populist game in the heat of the campaign, but they don't govern that way (Brown rode around Massachusetts in a pickup truck to polish his populist bonafieds). The anger is growing, but is unfocused.  That anger is evidenced by the utter breakdown of civility either in the halls of Congress or in the political discourse taking place everywhere. It's reflected in the xenophobic hatred of immigrants and an uptick in violence against racial and other minorities.  The teabaggers, birthers, and the Town Hall screamers are evidence of the growing rage, but there is also a growing rage among traditionally left-leaning voters, who have not yet realized it, but they have some common cause with these so-called nut-cases on the right. Rules in the Senate, and the peculiar dynamics of how we apportion Senators and how they're elected, in particular, make it impossible for either party to effectively address the populist demands of voters. 


The Limits of Power: The End of American Exceptionalism

January 20, 2010  |   Politics and Policy

The following is excerpted from The limits of Power by Andrew Bacevich.  It is long, but well worth reading every word. The American Empire Project      The Limits of Power: The End of American Exceptionalism By Andrew Bacevich Published by Metropolitan Books Excerpt Chapter One The Crisis of Profligacy Today, no less than in 1776, a passion for life, liberty, and the pursuit of happiness remains at the center of America’s civic theology. The Jeffersonian trinity summarizes our common inheritance, defines our aspirations, and provides the touchstone for our influence abroad.  Yet if Americans still cherish the sentiments contained in Jefferson’s Declaration of Independence, they have, over time, radically revised their understanding of those "inalienable rights." Today, individual Americans use their freedom to do many worthy things. Some read, write, paint, sculpt, compose, and play music. Others build, restore, and preserve. Still others attend plays, concerts, and sporting events, visit their local multiplexes, IM each other incessantly, and join "communities" of the like- minded in an ever- growing array of virtual worlds. They also pursue innumerable hobbies, worship, tithe, and, in commendably large numbers, attend to the needs of the less fortunate. Yet none of these in themselves define what it means to be an American in the twenty-first century.  If one were to choose a single word to characterize that identity, it would have to be more. For the majority of contemporary Americans, the essence of life, liberty, and the pursuit of happiness centers on a relentless personal quest


Time to Rethink Corporate Personhood

January 20, 2010  |   Paul Crist Politics and Policy

Since the early 19th century, the Supreme Court has ruled numerous times on the issue of "personhood" for corporations. That is, they have given corporate entities of all types the legal and political standing of a breathing human being. Some of those rulings were just and fair. Others have had the, perhaps unintended, consequence of subverting the democratic processes of our Representative Republic.   We talk much about how corporate interests have hijacked our legislative process, but the fact is that corporate wealth has always been used to influence our judicial processes in ways that have allowed these "special interests" to legally overrun the legislative branch.   Consider: There were 150 Supreme Court cases involving the 14th Amendment prior to Plessy v. Ferguson in 1896. (That nefarious case established the legal standing of "separate but equal.") The 14th Amendment ensures due process of law in legislation, equal protection under the law, etc. It was intended mainly to bring freed slaves into American society. Of these 150 cases heard by the Court, however, only 15 involved freed African-American slaves (and of those 15, they only won one case!). But 135 cases involved corporations or business entities. Corporations, under an expansive legal view of the 14th Amendment, have used it as a shield against regulation and taxes at both the federal and state level.   Corporations have used the 14th Amendment to consolidate their power in the U.S. and the world. They have gained many of the inalienable rights of humans guaranteed


Retiring in Mexico: Opportunity and challenge for Policymakers

October 7, 2009  |   Healthcare Issues

The Trend toward Retiring in Mexico: Opportunity and Challenge for Policymakers By Paul Crist, President, Americans for Medicare in Mexico, A.C. U.S. Retirees are choosing Mexico in ever-larger numbers In the past decade or so, Mexico has become an increasingly attractive destination for U.S. seniors considering retirement options. That trend is certain to continue, and grow, in the coming years and decades, as the Baby Boom generation reaches retirement age. There are a number of important factors that contribute to this trend. First, Mexico has become the number one tourist destination outside of the U.S. for American travelers. As an increasing number of Americans are of Mexican heritage with familial and cultural ties to Mexico, and as the number of U.S. retirees increases (and thus increases the time they have for travel), Mexico is set to become an ever more popular tourism and retirement destination in the coming years. Retirees that choose to reside in Mexico, whether of Mexican or other heritage, nearly always have visited Mexico numerous times as tourists. They know Mexico, and know that negative U.S. media coverage about Mexico is often slanted, sensational, and fails to recognize the size and diversity of Mexico. The firsthand knowledge of tourists eliminates the fear of living in Mexico. For example, they are more likely than Americans who have never visited Mexico to know that “violence in Mexico” is really just about a 35 to 50-mile region along the U.S. border. They know that Mexico is blessed with great natural