Obama's Proposed Federal Budget Cuts for Education and Mass Transit

After the American Century

This is the first year that President Obama and his administration can be said to be fully responsible for the budget proposal. Last year they had just started, and there was little time to dig deeply into the details of federal spending. In what follows I want to focus on spending cuts in the area of education, because during the election campaign candidate Obama seemed to understand the need to improve the levels of learning in the United States. The future belongs to the best educated nation, with a workforce that can innovate and redeploy their resources. Or so it was said.

Now the actual spending proposals suggest no more commitment than under the previous administration. Here are some examples of the cutbacks:

Academic competitiveness, smart grants -58%

School improvement: -55%

Education for the Disadvantaged -31.9%

Special education: - 4.7%

Vocational and adult education: -3.7%

International educational exchange programs: - 0.3%

To be fair, there are other education programs that are slated to receive increases, and this is a difficult budget year. Nevertheless. the cutbacks are disheartening.

What about transportation? One hoped to see an Obama Administration promoting mass transit. The proposal, however, is for a 35% cut for railroads, and a 9% cut for mass transit in the discretionary part of the budget. There is mandated spending on railroads that remains unchanged. By far the lion's share of the transportation budget is mandated, and must be spent on highways. Next at the federal feeding frenzy are the airports, which receive much more than the railroads.

In short, the vast economic mess that the Bush Administration left behind has not only made it hard for Obama to move in a new direction, it seems to make it virtually impossible until the economy improves.

Even when it does improve, however, the increased interest on the national debt will eat up the money that once might have been used for education, transportation, and social programs. The interest payments next year will rise by 33% to $251 billion. Just paying the interest on the debt will be greater than the entire budgets for transportation and education combined, with energy thrown in for good measure.

Make Corporations Full Citizens

After the American Century #207

In American law the idea developed that corporations ought to be considered individuals – or persons. This idea makes a certain sense if narrowly interpreted. For example, a corporation, like a person, can be governed by the same laws regarding contracts. The corporate “person” could also be sued for liable. But in a revolutionary ruling last week, the United States Supreme Court decided that corporations also have the right to free speech and are protected by the Bill of Rights. The Court might have ruled far more narrowly but instead went out of its way to declare that corporations may advertise freely and directly in political campaigns. (Logically, the Court should also have given corporations the right to vote in elections, but perhaps it is saving that decision for another time.)

In the interest of making corporations into better fellow citizens, here are specific proposals to help them achieve a fuller humanity, since that is what the Court clearly desires.

1. Slavery being outlawed by the Constitution, it therefore should be illegal for one corporation to own another corporation. Holding companies clearly are a modern form of slavery that must be eliminated.

2. Hostile corporate takeovers must henceforth be regarded as acts of aggression that are punishable as crimes. A hostile takeover of a corporation must be considered a form of kidnapping, in some cases followed by murder, and punished accordingly.

3. Corporations that close down should be subjected to the same laws of taxation as the estates of deceased individuals. As it is now, companies can more resources around, closing down one company and opening a new one as often as they wish, without being subject to the taxation (and in effect the audit) imposed on a human being’s estate.

4. Since human beings are not immortal, it seems only fair that corporations be declared legally dead every 60 years (this being the maximum length of most person’s adult life). This death could be followed immediately be corporate rebirth, but only after paying the estate taxes.

5. Corporations should be punished for murder in the same way that people are. If they want to be considered persons, then they cannot pick and choose which legal obligations they want to assume. At present, when a corporation pollutes the air or water and as a matter of statistical certainty, makes some people ill and causes others to die, the “normal” practice is to fine them and to force them to pay compensation to the victims. This is not right, as it allows a wealthy “person” to substitute a cash payment for imprisonment. Real people cannot do that, why should corporations be allowed to get off? The people who give themselves those big corporate bonuses and stock options must also now be held criminally liable for the corporation’s behavior if they accept the payments.

6. The old idea of the corporation included the provision that people who invested in them had limited liability. That is, they could lose only the money originally invested, but had no personal responsibility in case the corporation ran up huge debts. In the nineteenth century, when corporations first were becoming a common way of organizing a business, many ordinary people protested. It seemed unfair that an ordinary grocer or carpenter was fully liable for his actions, while a vast corporation that owned many grocery stores or built many houses had limited liability. Clearly, now that the Court in its infinite wisdom has ruled by a vote of 5-4 that corporations have political rights, it follows that they can no longer claim limited liability. If they want to claim the rights of people, then they muse assume the obligations of people. Alternately, one would have to extend the same right of “limited liability” to all Americans, not just corporate Americans.

Now that the Court has ordered us to welcome corporations into full membership in political and civil society, the essential thing is to make sure that they take on ALL the obligations of citizenship.

2000-2010: The Flat Decade

After the American Century

This time of year one takes stock, and that usually means reconsidering the last 12 months. But as we reach 2010, I think also of the last decade in America.

It was not a good decade. The United States in 2000 was rapidly paying off its national debt. Its economy had created millions of new jobs in the 1990s. Trust in the banking system was high. The nation was basically at peace.

Ten years later none of this is true. It has been a flat decade, with little to show for itself. The national debt is growing rapidly. Almost no new jobs have been created, on aggregate, since 2000. The Dow Jones Industrial Average is now about where it was in 2000, after gyrating uncomfortably up and down, and people rightly are suspicious of bankers. Worst of all, the United States has spent huge amounts of money on dubious wars in Afghanistan and Iraq. And hanging over the whole decade like the pall of smoke rising from the fallen World Trade Center is the specter of terrorism.

There are bright spots, the most noteworthy being the election of President Obama. But even that success is tempered by the realization that the Congress lacks a sense of national purpose and has tremendous difficulty rising above the level of petty in-fighting and party squabbles. It compares poorly with the Congress of 1933, when Roosevelt passed a wide range of important legislation. In 2009 a comprehensive health bill has almost been completed, but we await final negotiations between the Senate and the House to find out just how good or bad the final result will be.

2009 was also the year when when attempts to reign in rampant CO2 and global warming went off the rails at the Copenhagen Summit. It was the end of a decade of often mindless growth in the developing world, which seems intent on making every industrial mistake that the West pioneered decades ago: smog, lead poisoning, urban congestion, the "car culture," and, of course, my clever readers can complete this list. Should we really celebrate the fact that China's growth rate was roughly 9% per year during this decade, and that it now buys several million more automobiles than the US every year?

But hope springs eternal, as indeed it must, and here are some wishes for 2010. That the global birth rate falls rapidly toward sustainable replacement of the existing population. That consumers discover contentment with environmentally safe products and high-mileage cars. That voters insist on more and better mass transit. That bankers act more responsibly and stop giving themselves huge and undeserved bonuses. (OK the last one is probably an absurd wish). That the US economy embraces solar and wind energy, even if Congress spinelessly does little to encourage it. That the need for any foreign military in Iraq really does wind down. And that confrontations between Christians and Muslims become less common, as dialogue and mutual respect replace demagoguery and fear.

Human beings could accomplish all of these things, starting in 2010. In theory, I could also lose some weight in 2010 but my past history suggests that even this will prove a hard New York's resolution to hang on to. So, modestly, let us hope that we all do a little better.

Copenhagen's Chinese Christmas Present

After the American Century Posting 204


As more insider accounts of the Copenhagen Summit come in, the Chinese emerge as the chief villains, a strong word, but not strong enough in this case. A piece in The Guardian reveals how the Chinese sabotaged attempts at a final consensus.

In the future, clearly, one cannot hold talks and hope that all the great powers agree. Giving every important power a veto right or the chance to undermine an agreement is just silly. Instead, the world will have to find another way to work toward relieving global warming. The summit model is not working, and perhaps can never work.

Here are some interlinked suggestions:

1. Create a system that ranks countries into four groups, depending on to what degree they are working toward global warming.

2. Tell consumers worldwide where each nation ranks, so that they can choose intelligently and buy products based on how much a nation is in compliance with UN goals. Under such a system, China would get a D rating, of course, and the US would perhaps as well. I would hope that consumers would be more willing to buy from nations that are trying to solve the problem of global warming rather from those that are making matters worse.

3. Allow companies to be rated as well, so that an environmentally responsible company can get a higher ranking than the nation where they are located.

4. Cities of more than 300,000 people would also be able to apply for and achieve ratings, so that if Seattle or Munich or Oslo or Rio wanted to they could achieve a rating higher than that within their home nation.

5. Give aid for conversion to clean energy technologies only to those Third World Nations where the military budget is less than 2% of GNP. It is absurd to pour money into a nation that is investing in arms and airplanes rather than solar panels, wind mills, and the like. Many poor nations are not focusing their own resources on the problem, and if this is the case, why should anyone else?

6. Give annual awards to successful projects (actually completed, not just proposals) that both improve the quality of life and reduce global warming. Make the awards as glamorous as the Nobel Prizes or the Academy Awards. Governments whose nations are in the A category would also be put in the limelight at these events and part of the ceremony would be to welcome any new members of the "A" club and to congratulate those who had moved up a category. Nations in the D category would not be allowed to have an official speaker or presenter at the awards, but they would be welcome to attend.

7. Instead of the trading system that most nations now have or want, where all free trade is considered to be a good thing, no matter what is traded, nations would be encouraged to revise their import taxes or other tax codes to favor products whose production and use had the least environmental impact. This sort of taxation would recognize that it costs more to manufacture in an environmentally responsible way. I do not suggest that the taxes be punitive, but rather that they be a restructuring of current VAT, and that they be applied to c. 100 goods that are particularly important in this area, notably automobiles, air conditioners, stoves, televisions, and so forth.

As these proposals suggest, we can no longer wait around for the nations of this earth to become unanimous. China blocked the deal this time, but it could be someone else the next time. Instead, turn loose the power of consumers and introduce something that the Chinese can understand: SHAME. They may think they have emerged as a great power, but the Chinese have lost face. Their government has not behaved in an honorable way.