One year after Mohammed al-Bouazizi lit himself on fire in protest against mistreatment by police, sparking a movement that has toppled regimes in Tunisia, Egypt and Libya, a global wave of popular protest continues, from the Arabic-speaking world to Europe, India, Chile, the United States and Russia. Today, democracy advocates protest unlawful detention, arbitrary power and socio-economic injustice across the world.

December 17, 2011, marks the one year anniversary of Mohammed al-Bouazizis desperate self-immolation, the 24th birthday of Bradley Manning, a US Army private held in solitary confinement in conditions some have described as torture, for allegedly releasing secret documents, and the three-month mark of the Occupy Wall Street movement seeking to take back public spaces, Constitutional liberties, and the fundamental right to active participation.

Tragically, in Egypt, this day of worldwide celebration and peaceful protest is being marked by a deliberate campaign of killing against unarmed civilian demonstrators, by the last holdouts of the old criminal regime, who now say democratic gatherings are counter-revolutionary activities that warrant deadly force.

The news from Cairo today: military police squads stormed into Tahrir Square, lit the protest camp on fire, have shot and killed an unknown number of unarmed civilians, and have allegedly begin throwing people off of a bridge into the Nile River. The depraved indifference to human life is so extreme, the civilian advisory council, that was supposed to lend some legitimacy to the military junta running the country, has resigned in protest.

It now appears that under the negotiations agreed after the fall of Hosni Mubarak, the military council now longer wields any legitimate authority, and it is time forth international community to apply maximum pressure to force all military personnel out of power and implement an immediate, and orderly, transition to 100% civilian rule.

All acts of violence against civilian demonstrators must now be treated by the international community as deliberate, coordinated crimes against humanity, and arrest warrants and/or material witness warrants issued for every member of the ruling military council. International warrants should be put on hold only if the crimes committed are prosecuted through a credible, legitimate, transparent system of due process, in Egypt.

In Syria, after 9 months of resistance to the escalating aggression and violence of the Assad regime against its own people, at least 35 people have been killed in direct military assaults against civilians. Russia and China are blocking direct action through the United Nations Security Council, but Assad has now lost all legitimacy, and will likely be the next dictator swept from the scene. One can only hope it is achieved before he kills another 5,000 of his own people.

In the United States, the use of paramilitary tactics and alternative combat weaponry (including chemical agents, LRAD sound cannon, flash-bang grenades and rubber bullets) to evict or shut down Occupy protest camps, has become commonplace. There is, now, a mounting popular concern about the commitment of elected officials to the fundamental principles of the Constitution.

Instead of honoring the historic force of principle being expressed by the American people, city governments across the US have given in to the darkest temptations of arbitrary power, and have declared the commons off limits for peaceful protest, using potentially deadly force at times to bar citizens from exercising their constitutional rights to free assembly, free speech and open protest (to petition the government for a redress of grievances, many and far-reaching).

But TIME Magazine, recognizing the worldwide wave of citizen awakening that has marked the year 2011, has named The Protester its Person of the Year. Across the middle east, across Europe, in India, Chile, the United States, and now in Russia, a movement of citizen-centered activism is not only occupying public spaces to demand immediate positive change in political and economic structures, but is now publishing, webcasting and building a global collaboration to bear witness to any and all obstacles to genuine democracy.

On December 17, 2011, hundreds of thousands of people across the world are honoring the cause of humanity: freedom, dignity, equal treatment and equal opportunity, and the primacy of the citizen over the power of the public servant. #D17 is intended to be a global day of celebration and resistance.

The Occupy movement in the United States marks its third full month in practice today, and a transition to focused actions to right injustices is underway. Occupy assemblies are discussing and deciding plans for new encampments and an OccupyHomes movement is spreading, as legal advisers, protesters, concerned citizens and others, join together to literally take back foreclosed homes from banks the occupiers accuse of criminal activity and predatory mortgage and foreclosure practices.

The world will enter the year 2012 infused with a now explicit and spreading demand for an end to all forms of tyranny, including that great weapon of all tyrants: official secrecy. Technology, democratic process, creative media and nonviolent civil disobedience are converging to allow citizen volunteers to retake the reins of the decision-making process, potentially turning advisory protest movement into a new civic order, designed to uphold and propagate genuine democratic rights and safeguards.

Engaged citizens everywhere should demand that every public official at every level honor the primacy of citizens over the exercise of power.

The spreading Occupy movement has seen one after another sit-in, protest camp or march brutally and inexcusably assaulted by paramilitary police actions, using chemical agents and other weapons of war, against unarmed, nonviolent citizens exercising their basic constitutional rights. The result has been a rash of unfettered violence across the world against pro-democracy advocates.

In Egypt, officials have openly said they should be allowed to use military violence against civilian demonstrators, because it is being done across the United States. After the atrocities of Oakland, when police fired rubber bullets, flash-bang grenades and tear gas canisters at point-blank range at penned-in, unarmed demonstrators, sending ex-Marine Scott Olsen to the hospital with a fractured skull and brain injuries, the use of paramilitary tactics seems only to have spread.

In New York City, Mayor Michael Bloomberg last week staged an unannounced, midnight raid on the original Occupy Wall Street protest site, using chemical weapons, LRAD combat sound cannon, and police officers in riot gear swinging wildly with billy clubs against anyone in sight, regardless of threat or posture. There has been no penalty, and no punishment, for officers engaged in aggravated assault against civilians.

Mayor Bloomberg deployed counter-terrorist police helicopters to the scene of the violent assault, to prevent news helicopters from filming what occurred. Press were banned from the site, by what authority it remains unclear. At least 26 journalists were assaulted, beaten, injured, and/or detained, on the night of the Zuccotti Park raid. There was a planned, deliberate use of violence and combat tactics against unarmed, nonviolent, even sleeping and prone demonstrators.

The brutality of the raid was so severe that when City Councilman Ydanis Rodriguez (D-Washington Heights) rushed to the site to observe and to make the case against the use of violence to disperse the protesters, he was assaulted by police and arrested for disorderly conduct. According to the New York Daily News: Several people detained with him told me Rodriguez was bleeding badly from a gash in his forehead. Still, by 6 p.m., he had not been arraigned and his lawyer, Leo Glickman, had not been allowed to see him.

Glickman says his client is not even being afforded the basic due process protections afforded to any arrestee and that the citys treatment of the protest and of the councilman is an effort to silence the movement. At least one retired state Supreme Court justice also found her attempts to provide legal observation to the raid obstructed. The Daily News reports the scene as follows:

Retired Supreme Court Judge Karen Smith can’t believe what she saw this week. At the urging of her son, who joined the Zuccotti Park protests weeks ago, Smith had volunteered to be a legal observer in case of mass arrests.

She received a text message early Tuesday that a bust was imminent, so she got to Zuccotti around 1:30 a.m. As she exited the subway at Broadway and Dey St., she met a wall of cops in riot gear who were preventing people from getting anywhere near the park.

“There was a black woman standing next to me,” Smith said. “She kept frantically telling the cops her daughter was in the park and she wanted to make sure the girl was okay.”

“All of a sudden, a cop takes his baton and cracks her in the head,” Smith said. “She hadn’t done a thing. Then they started chasing people down the street.”

Smith’s efforts to get police to recognize her as a legal observer proved futile. Likewise, several reporters who were arrested while covering the protest found their press credentials worthless.

Crimes were committed by authorities that directly violate the Constitution of the United States and its fundamental protections for free speech, freedom of the press and the freedom of the people to peaceably assemble. The denial of access to counsel for some and the barring of press and legal observers from the scene is a clear attempt to circumvent the right of the people to petition their government for the redress of grievances. Some First Amendment advocates have accused the city of barring press and legal observers in order to 1) undermine the evidentiary process and 2) allow for impunity in the use of extreme force by police.

Across the United States, we are witnessing, sadly, one after another mayor decide that the free exercise of constitutional liberties is a threat to public order, only to deploy paramilitary tactics to crush peaceful protests.

There are accusations of a coordinated planning strategy among mayors to determine what level of force they will deploy, and by what means, to crush the demonstrations. Some mayors offices have claimed the right to secrecy for security reasons, and there are Freedom of Information filings being made to learn who knew what when, and who gave which order that led to police firing on demonstrators, or using chemical weapons in unprovoked attacks against citizens.

In Egypt, where the nonviolent Tahrir Square uprising brought down the dictator Hosni Mubarak, in just 18 days between January 25 and February 11 of this year, authorities are now openly citing the actions of American mayors and police forces as justification for their use of extreme violence against nonviolent civilian demonstrators calling for genuine democratic reform. Mayors Bloomberg, Emanuel, Quan and others, are aiding and abetting the use of extreme violence to crush pro-democracy movements across the world.

This is not hyperbole. This is not interpretation. This is what is happening:

• In the streets of New York City, paramilitary forces were deployed, using tactics designed for armed combat in a warzone, using weapons designed specifically for combat in a war zone, deploying chemical weapons against unarmed civilians and banning all press coverage of the event.
• In the streets of Oakland, police shot a former Marine in the face at point-blank range, while he was penned in, and despite his having no weapon of any kind, posing no threat to anyone, and doing nothing of any kind in violation of any law. When he fell to the ground, gushing blood and good samaritans rushed to his aid, which not one of the police present did, an Oakland police officer fired a flash-bang grenade apparently loaded with tear gas directly into the huddle of people trying to help him, as if to finish off the protest with one last shot.
• At UC Davis, police walked along a row of nonviolent student protesters linking arms, and deployed a chemical weapon directly into their faces, with reckless and abject disregard for their health, their wellbeing, their rights, the rule of law or their own obligation to protect and serve.

In each case, the authorities behaved in direct contravention of the Constitution of the United States, and carried out brutal, wanton, physical assault against unarmed civilians. The violence against journalists in New York City is among the most worrying developments, because it suggests a depraved disregard for American law at the highest levels and directly mirrors the kind of planned atrocities being carried out in countries where corrupt regimes are actively trying to stamp out all pro-democracy protest.

In Egypt, the escalation of official violence against protesters has left 33 people dead since Saturday. The lesson of military impunity taught by Mayor Bloombergs assault on demonstrators has been learned, and is being treated almost as legal precedent by corrupt regimes unwilling to consent to any genuine open democratic process. The consequences are increased impunity, increased suffering, the deaths of innocents and an attempt across the region to roll back the democratic gains of the Arab spring.

People across the United States should stand together, regardless of party or ideology, and demand that there never again be even one instance of law enforcement being deployed to use force against any civilians exercising their basic rights.

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Related:

• The Oakland Crackdown (discussion)
• What is the Meaning of This?
• Occupy Wall Street, with a People-centered Investment Bank

We need a system of cooperative public-private infrastructure financing, a national infrastructure bank. But we also need to use that fabric of cooperative investment and output to foster specific areas of major improvement to our national economy. The model could be replicated across the world, but the US is uniquely positioned to deploy this solution and to vastly improve its chances of restoring vibrancy to the wider middle class by doing so.

Two parallel projects are necessary to make the infrastructure redevelopment and economic recovery strategy a success:

• a renewable energy infrastructure bank – to help target some of the wider funding options to the project of building a sustainable, smart energy economy, free of the massive externalized costs of carbon-based fuels
• an economic opportunity bank – to aggressively, specifically and persistently direct funds to businesses that are hiring, building capacity at the community level, and restoring real wage gains to the middle class

The first is our topic here: a national renewable energy infrastructure bank. To build such a bank, we would need to first establish how a cooperative public-private infrastructure financing scheme would work. Ideally, it needs to work much like an investment bank, where individual investors see visible gains, but money is kept in the pot for a long enough period of time to produce gain across the full spectrum of investor contributions.

In other words, there has to be commitment to the project, and that shared commitment of resources will yield shared substantial gains to all parties. In the area of clean energy investment, this is possibly much easier than with other types of infrastructure investment, because the industry is entering into a period of massive, and necessary, prolonged expansion. Big investors understand that big investment will help to secure that prolonged expansion.

If Congress acts to incentivize this investment, massive amounts of private-sector capital will flow to clean energy resources. There are three reasons why this will happen:

1. Fossil fuels carry with them massive production costs that have long been externalized; the economy can no longer afford to continue such a strategy.
2. Clean energy technologies offer a major opportunity for prolonged expansion of business value, as information technologies have shown over the last 30 years.
3. There are literally hundreds of billions of dollars of private capital sitting on the sidelines, waiting for directional certainty that fossil fuels cannot provide.

So, how to structure such an operation? The renewable energy infrastructure bank would need the following to reach its full potential:

1. A national price signal or clear set of incentives to direct investment to clean energy
2. An investment strategy that looks at best practices, value to community, prospects for building aggregate demand, and structural resiliency
3. A focus on job-creation, skilled retraining, and positive value feedback loops that favor consumers
4. A legislative charter that sets forth priorities favorable to public-sector, private-sector and start-up investors alike
5. A model for redirecting funding when key elements of a project require support or restructuring
6. A focus on rewarding institutions, individuals and investors who do cutting-edge R&D that is practicable, 100% carbon-emissions-free and scalable
7. Short-, medium- and long-term investment strategies for building, optimizing and utilizing the smart grid

Suggestions for deployment:

1. Implement a national carbon fee and dividend policy, to correct market failures in the pricing of carbon, return control of the energy economy to households and incentivize major private capital investment in the rapidly expanding clean tech sector
2. Identify, build or support and expand, focus facilities in cities and regions across the country, to operate as cooperative laboratories of R&D, start-up incubators, and investment engines (examples might be Brooklyn Navy Yard or Philadelphia Navy Yard, or the Fab Labs project)
3. Motivate scalability planning for distributed clean energy production projects, to ensure sustained investment opportunities, and optimized overlap between community-building, job-creation and investment strategies, for higher overall cost efficiency
4. Ensure legal support for avoiding corrosive business models, favoring generative ones, to ensure Investment flows to the new technologies and collaborative strategies that build future prosperity, not to extraction-oriented investments
5. Reward rapid ramping up of high-efficiency clean energy tech, because this will build structural resiliency, favor the highest-value market-healing technologies, and help to revive the middle class

We can begin doing this nationally tomorrow, if:

• We focus first on wind and solar, due to their naturally occurring US domestic supply far outstripping total demand and all possible demand growth
• We commit to decentralizing innovation, influence and income-growth in the energy sector, so community and regional economies are empowered by the transition
• We recognize the need to fully develop leading-edge infrastructure at all levels
• We identify and elevate the pioneers who already know how to motivate and execute this transition
• We charter public-private partnerships to manage investment flows to stakeholder-defined initiatives

The clean energy economy is coming, and to fully enable its expansion, the US needs to flex the muscle necessry to turn the ship of state, to wrest from entrenched industries and financial investment patterns rooted more in extraction than in generative payoff the ability to decide what comes next. There is nothing beyond clean and renewable in terms of energy production and distribution, except the work of achieving the most advanced efficiency gains and making robust power generation an ever more ephemeral affair, at an ever faster rate.

To lead in that new economy, we need to be the first to build its value.

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Originally published October 12, 2011, at ProjectQuipu.net

The Occupy Wall Street movement—now being called “the American Autumn”, after the Arab Spring, or the September 17th movement, after the day it got started in lower Manhattan—is now completing four weeks on the scene. Yet we can still be astounded to hear so many incredulous “experts” unable to understand how a grassroots movement, infused with the zeitgeist of very problematic times, is working toward anything constructive. What is the meaning of this? Why don’t they have a ready-to-go list of demands? What are they asking us to think?

It’s actually very simple. It’s self-evident, but if you’re at a loss, you can also go to Zuccotti Park, or to any of the Occupy Together protest sites, and just talk to people, and what did not seem evident will rapidly become so. The meaning of the Occupy Wall Street movement that is spreading across the United States like wildfire is: democracy. The unifying sentiment, which is actively put into practice every day at Occupy encampments, is that citizens have a right to participate. They are building a participatory process to restore the principle of informed citizen participation to our political system and our economy.

Listen to the protesters: “Show me what democracy looks like! This is what democracy looks like!” This is not pretend protest; this is the message. The message is that people have a right to free assembly, have a right to free expression, have a right to govern their own destiny, have a right to earn a living, to expect that as citizens of a free society, as implicit signatories to the social contract that gives legitimacy to our democracy, they have a right to be treated with dignity.

Above all, they believe it is necessary to restore to prominence the idea that we all have a right to expect that the powers that decide the shape of our everyday existence 1) represent us, and 2) be accountable directly to us, to the people. Participation and transparency are antidotes to the temptations of unfettered power, elite negotiating environments, and deals that ignore the interest of most people and structure outcomes to favor insider interests. Participation and transparency are democracy; their absence is not.

The non-violent citizen-action uprisings that ousted dictators in Tunisia and Egypt early this year inspired a wave of protest across Spain, in which people calling themselves Los Indignados—the indignant—occupied central squares in Madrid, Barcelona and cities across the country, with semipermanent encampments: acampadas. They formed asambleas by topic or task and held asambleas generales to decide the direction of the national movement through direct democracy.

OccupyWallStreet.org describes the American movement as follows:

#OCCUPYWALLSTREET is a people powered movement for democracy that began in America on September 17 with an encampment in the financial district of New York City. Inspired by the Egyptian Tahrir Square uprising and the Spanish acampadas, we vow to end the monied corruption of our democracy … join us!

There is now a nationwide OccupyTogether movement that seeks to coordinate the actions, debates and proposals of protesters across the United States, and across the world. As of today, they have rallies planned for 1,539 cities, large and small.

The global movement inspired by the Tunisian and Egyptian uprisings has spawned not only the Spanish acampadas and the American Occupy protests, but also the Chilean student uprising, which has shut down much of Chile throughout the southern winter, as students demand wider access to high quality public education.

Some participants have been very vocal that the message should consistently be anti-corruption. And it clearly is. In every sense, the non-violent, sleep-on-the-street, do-for-others, collaborative enterprise that is the Occupy Wall Street movement, has persistently demanded transparency, integrity, corporate social responsibility and accountability. It is very much about transcending what is corrupt in the current system. But it is also about something deeper than that.

Last week, with a large crowd echoing her words in chorus—a practice called “the people’s mic”, done to amplify spontaneously, at the human scale, without electrified amplification—Naomi Klein said the movement was attempting one of the most arduous, improbable and time-consuming tasks: that of “changing the underlying values of our culture”.

There have been crazily tone-deaf responses from some in the political establishment, calling citizens engaging in constitutionally protected non-violent assembly “mobs” and referring to calls for justice, fairness and the restoration of middle class opportunity “class warfare”. What motivates such comment is hard to fathom, though pundits, activists and foreign observers alike seem to think it is simply an unwillingness to see the obvious truth: that the powers that be have forged a dysfunctional and distorted economy that does not benefit most people and does not foster real democratic freedom at the human scale.

The movement has consistently made reference to “the 99 percent“, the vast majority of people not earning 7-figure annual income. The movement seeks to represent the right of that 99 percent of all people to be heard, to have a direct role in helping to fashion the policies that determine what kind of society they and their children and families will inhabit. Messages describing the complaints and motivations of those who want better treatment of the 99 percent are posted at We are the 99 percent.

And they have won support from many of the 1 percent that do benefit from the policies that disadvantage so many. A Tumblr page called We stand with the 99 percent is recording their messages of support for the Occupy Wall Street movement.

The Occupy Wall Street movement seems only to be spreading, gaining support and becoming more organized, because it is focused on restoring a sense of reason and justice to a nation too long forced to accept widening inequality, rigged markets and pervasive corporate tax dodging. The cause is as close to universal as one can get. It is about calling on those with responsibilities to hundreds of millions of people, whose decisions affect the lives of hundreds of millions of people, to behave as if that responsibility carried some weight in the calculus of their decisions.

The Occupy Wall Street movement is about people willing to give voice to those without a voice. In the assembly process, people don’t just debate ideas, or choose leaders. They aren’t caucusing for positions, or jockeying for influence. The assemblies allow anyone to speak, and aim for consensus. The consensus building process entails hearing all voices, considering competing ideas, then building coalitions of support in order to achieve real consensus among those in attendance. The plan is direct democracy, plain and simple, but specifically a kind of direct democracy in which no one is marginalized.

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Originally published October 14, 2011, at ProjectQuipu.net

Saturation means more of a given ingredient cannot be added to a given volume or fabric of activity, without spilling over, and being wasted. The fossil fuels market is saturated, in the sense that it cannot effectively capitalize on major new production investment without major new construction of productive facilities. The industry has effectively pushed prices higher and cannot reduce them without seeing a dropoff in profits. Most people can no longer afford the fuel they used to consume.

This raises the question of scalability. Scalability refers to the notion that as activity of a given kind expands, as the benefits and efficiencies of size, reinforced by growing market share, which means a greater ability to determine outcomes, an economy of scale arises: a thing begins to cost less per unit or per usage, because a scalable activity has made the unit or the usage cost less without reducing overall revenues.

Scalability depends on many other features of the marketplace, however. One of these is the value of investment. Another is the availability of that investment. When a market has already gone global, and is controlled by a handful of megaconglomerates and governments, and is saturated, and is pricing reliant consumers out, investment slows down. In a credit-scarce economy where no one is as rich as the oil interests, even moreso.

The ability to rapidly scale up production, and to create a potent and escalating visible return on investment for consumers, is hampered by justifiable skepticism about where this globalized, saturated and entrenched market sector can hope to go. Add to that this problem of a business model whereby one consumes a finite fossil resource that cannot be reproduced, burning one’s assets as one goes, and you have a model that does not shape up favorably for the 21st century.

The S&P 500 are now sitting on over $1 trillion in accumulated cash reserves. This money could, and normally would, be invested in future economic development. But sclerosis in the top-heavy oil sector, a serious lack of capital in the hands of consumers, and the real vulnerability of banks and even governments, are all conspiring to hold that money back. Wise investors understand that when the marketplace for risk and investment fails, a rainy-day fund is the best option.

In stark contrast to the fossil fuels sector, the clean renewables sector:

• is far from saturated,
• produces an ever-increasing rate of return for investors,
• is primed to produce economies of scale,
• can offer more jobs at better wages over a longer term,
• and lends itself to accelerating efficiency gains.

So, why are so many smart people still saying they favor the economics of oil? Two reasons:

1. They are invested in the fossil-burning-for-profits model and so don’t accurately perceive the saturation problem;
2. They don’t understand the paradigm shift and so view clean energy not as a rapidly expanding market but as a feeble one.

It’s not presumptuous to make these assertions about the anti-clean-energy crowd; it’s giving the benefit of the doubt to people who are not seeing the lay of the land as it is, but rather as they are accustomed to hoping it is. It is wishful thinking to hold that oil will always be king and no better option will replace it, wishful, that is, if you profit from oil’s dominance. The same with coal.

We are running out of ways to extract coal cheaply without literally blowing mountains apart, wiping them off them map, which carries very significant costs. Coal is an 18th-century technology not optimized for our 21st century needs. While employment from coal steadily declines, the risks and costs of its production mount, and coal-rich communities continue to experience chronic endemic poverty which the industry has been unable to solve.

We are running out of easy access to oil; the remaining reserves are trapped in undeveloped remote wilderness, behind high-risk, low-yield extraction processes that require major new dirty energy infrastructure to be built. Their development will impede investment in and development of better, cleaner, more efficient alternatives. We can do much better.

The fossil fuel saturation problem, known to states like Texas as an ongoing “energy emergency”, means we need to be actively searching not only for alternative fuels, but also for investment opportunities where we can build in drivers of more generalized prosperity, i.e. a restored and strengthened middle class, and accelerating returns in productive capacity.

The only way to achieve that is by building a smart-grid-based distributed clean renewable-energy market.

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Cross-posted from TheHotSpring.net

The four coordinated hijackings, resulting in three deliberate attacks and one downed passenger jet, took 2,977 innocent lives and sowed fear and dismay across the world. They were acts of unconscionable evil intended to not only harm innocents and terrify the wider population, but to destabilize American democracy itself, and derail a people’s journey through history, possibly to erode its most virtuous contributions.

It was a clear, sunny morning and the first plane crashing into the North Tower of the World Trade Center had sparked a sustained global news flash, bringing hundreds of millions of eyes to the television footage. There was confusion and disbelief, and just as it was becoming clear there must have been a devastating loss of life, a massive fireball engulfed the top half of the South Tower, clearly signaling a deliberate terrorist attack was underway.

Less than 2 minutes later, the White House chief of staff told the president, then in a public event with schoolchildren, that “America is under attack.” A third plane flew into the Pentagon, headquarters of the US Dept. of Defense, while the fourth crashed into a field in Shanksville, Pennsylvania, after passengers reportedly made a fateful and heroic decision to rush the cockpit and take back the plane from the hijackers.

In the days after the attacks, it was often said such heinous acts would not be allowed to change our open, democratic culture or to reduce our commitment to moral leadership in the world. Pres. Bush made a visible, conscious effort to ask that no one treat Muslims or people of Arabic origin or descent, as anything other than members of an open, democratic society, as neighbors and possibly as victims, of the attacks.

But in the months and years that followed, the pressures and temptations inherent in legislating and prosecuting the war on terror drew the US federal government into planning and implementing policies that marked an appreciable and concerning detour away from many of our most cherished shared principles.

We have suffered, in the aftermath of the attacks, fully a decade of war. From the standpoint of an idealist democracy, or of just war theory, from the standpoint of a civilization committed to peaceful coexistence and negotiated outcomes, war is failure. It is the failure of peace, of the institutions of peaceful negotiation; it is the threat of a descent into chaos. War tests the moral fiber of a society more than any other experience.

In one of the most emotional and solemn of the speeches given to commemorate the legacy of those lost, Vice President Joseph Biden noted that “Never before in our history, has America asked so much over such a sustained period of an all volunteer force. I can say without fear of contradiction or being accused of exaggeration that the 9/11 generation ranks among the greatest our nation has ever produced.”

He spoke of 4,478 “fallen angels” who died in Iraq, another 1,648 who gave their lives in Afghanistan, over ten years, many of them in recent weeks, and the more than 40,000 wounded in both wars. Biden has visited the wounded soldiers many times, and said “I am awed not only by their capability, but by their sacrifices, today and every day.”

To this day, military strategists disagree about whether going to war as a response was a major strategic blunder. It was important, and positive, to oust the Taliban from power, to end the murderous regime of Saddam Hussein, but the unity and the worldwide human fabric of sympathy that grew immediately after the 9/11 attacks bled away as a politics of division and confrontation took hold.

Some professional politicians deliberately adopted the attacks as a “wedge issue”, and sought to paint rivals to their political philosophy or to their job security as enemies of the state. A naturally occurring sense of democratic, civic unity was replaced by a push for ideological uniformity. Many Americans began to feel, for the first time in their lives, as if dissent, or even critical thinking, was not welcome in the public discourse.

The very idea of engaged citizenship was challenged by a prevailing attitude of hardline politics, and for many, fear and suspicion. In retrospect, it may have been possible to depose the Taliban and to counter Al Qaeda, without ever going to war in Iraq, without adopting interrogation techniques borrowed from Cambodian death camps, and without giving in to the suspicion that due process was somehow a risky departure from the best service of justice in a free society.

In retrospect, there may have been better ways to channel the collective emotional upheaval that followed the attacks. Historians were already talking of how quickly the political capital of the moment was “squandered”, as less than two years after the attacks, an aggressive, unilateralist drive had totally overtaken American foreign policy. There was, for several years, a great risk that American democracy would be forever changed, and many of its most vital ideals eroded.

But today, in northern Virginia, Vice President Biden reminded us of something else: the attackers misunderstood the nature of the event they had planned and its likely impact on the nation they were targeting. While the risk was there that our culture could be comprehensively destabilized by the grief and anger that follow such an event, Biden suggested we were ultimately protected against that deviation by something Al Qaeda may never have understood:

With the fully restored Pentagon behind him, Biden intoned: “The true source of American power does not lie within that building, because as Americans, we draw our strength from the rich tapestry of our people.” He added that “The true legacy of 9/11 is that our spirit is mightier, the bonds that unite us are thicker, and the resolve is firmer than the millions of tons of limestone and concrete that make up that great edifice behind me.”

Biden explained the miscalculation of a small group of extremists who “never imagined” that the killing of 3,000 people would inspire 3,000,000 to volunteer for military service, to strengthen and defend a population of over 300,000,000. He spoke of the “sleeping giant” that was awakened by the shock and horror of the attacks. He was speaking not of a will to violence or retaliation, but of a spirit of aid to one’s fellow citizens.

In the hours after the attacks on New York City, a fleet of ferries, fishing boats, tug boats, small craft, commercial vessels and patrol boats, spontaneously gathered around lower Manhattan. The United States Coast Guard then sent out a message to “all available boats” to “report to Governor’s Island”. Hundreds of boats converged on the city to assist in the evacuation, arriving at what witnesses describe as astonishing speed.

After the North Tower collapsed into its footprint, engulfing lower Manhattan in a cloud of toxic dust, heat, smoke and debris, tens of thousands of evacuees—some injured, some in shock, many hysterical with panic, some just acting in service of those around them—were flooding the waterfront. Some were jumping into the water, despite the heavy boat traffic, desperate to get off the island and if possible swim to safety.

In what is now referred to as the great Manhattan “boatlift”, nearly 500,000 civilian refugees were evacuated in just nine hours. It was the largest evacuation by sea in history. By comparison, the legendary military evacuation of Dunkirk, during some of the darkest days of World War II, evacuated 350,000 French and British soldiers from France to Britain.

The great Manhattan boatlift was possible because conscientious citizen volunteers from across the region shot into action, heading into the unknowable dangers of an unprecedented disaster zone, risking their lives and livelihoods to help total strangers in desperate need. This was emblematic of a society infused with a strong sense of public trust and civic responsibility, where citizenship and shared destiny are implicit in our sense of who we are.

Ten years after the attacks of September 11, 2001, we have seen a spiritual recovery, in which people recognize that the values of such a society cannot be cast aside for any temporary sense of security. Our politics have seen a reversal, in which an unprecedented number of people voted, in 2008, for a politics of unity and civic engagement. And the hotly contested political campaigns have continued, with fevered disagreement over policy and ideology, but we can, perhaps say, that the freedom to disagree so vehemently is a celebration of the virtues of a free and open society.

Vice President Biden said to the families of victims today, “My prayer for you is that ten years later when you think of them, ten years later when you think of them, that it brings a smile to your lips instead of a pain in your heart.” There are many ways in which the legacy of the 9/11 attacks has long since been reclaimed from both the terrorists and the hardliners, and has come to inspire a commitment to service and shared responsibility.

Speaking of the bond between her family and the family of her brother’s great friend, coworker and fellow victim of the 9/11 attacks, Debra Epps today said, at the opening of the World Trade Center’s new 9/11 Memorial park, that the tragedy had brought the lesson that “People really do catch you, when you fall. It’s been a blessing.”

There are societies where unity in service of the civic space and one’s fellow citizens is a rare, if not unthinkable eventuality, and there are societies that are strong because free people naturally and voluntarily engage with each other with a sense of holding the civic space in trust, with a sense of commitment to the virtues and the vulnerabilities of their common humanity.

Ten years after the attacks of 9/11, the United States has been through many choices, many complexes of complicating choices, in response to the attacks. Many of those choices were controversial, and many have been reversed. Many curbs on civil liberties are still in place, and top officials disagree vehemently about whether there needs to be a trade-off between commitment to Constitutional protections of civil liberties and security.

Now, we enter a new period, in which withdrawal from Iraq and Afghanistan is already underway, a sometimes clumsy and always complicated process of nation-building is giving way to remote security actions, forceful “smart diplomacy” and a cooperative effort to prevent civil war in both countries. Osama bin Laden, and a number of “second-in-command” and “third-in-command” Al Qaeda operatives have been killed.

Some say the struggle against militant groups with “global reach” may be entering a more conscious deliberative phase, where the liberty-security tradeoff is not seen as being so economical. There is a hunger for reviving a less militaristic civic space, in which the cooperative voluntary citizenship of free people is the strength and the hope of a great democracy, in which the value of the service of millions of volunteers can be truly honored as an expression of their selflessness.

9/11 should, after this 10th anniversary, and in the aftermath of the deviation from and restoration of core values that we have undergone, become a national day of solemn recognition, collaborative restoration, and an affirmation of our civic space, in which citizenship is a sacred trust and human interest in the principal goal of our activity. It should be a day of national reflection and of the reaffirmation of the value of an open, democratic and voluntary civic space.

- – -

Cross-posted from Independents of Principle

Futurismo Verde :: Desde el comienzo de la civilización humana, el proceso de montar sociedades organizadas, formular historias compartidas y diseñar visiones del futuro humano, el ser humano ha buscado maneras de profetizar y de pronosticar. La ciencia moderna ha descubierto indicios fiables que ayudan a describir el mundo, pero para saber qué vendrá después del momento actual, tenemos que aprender a medir la salud de los sistemas naturales que deciden cómo vivimos.

El hecho es que la Tierra es un complejo de sistemas naturales, separados de los ecosistemas terrestres más remotos sólo por la intervención de otros ecosistemas. De alguna forma, todo el material del planeta, orgánico y no orgánico, está en constante comunicación a través de esta red de interacciones. El mundo viviente prospera debido a la interacción sana y sustentable de distintos sistemas naturales, alternando entre competencia y colaboración, y ganando por esa relación sana más flexibilidad de adaptación, más elasticidad.

La crisis vital viene a un ecosistema cuando deja de ser lo bastante elástico como para enfrentar el desafío sistémico del momento. Esa rigidez puede nacer de muchas causas distintas, pero suele arraigarse en una tendencia a la uniformidad y a la reducción de contacto dinámico con otros sistemas contra los que tendrá que competir, en un momento u otro.

La intervención humana, entonces, ¿qué significa para un ecosistema? Eso depende del tamaño y de la intensidad de la huella que deja esa intervención humana. Si se trata de construir una ciudad, es posible que la inmensa mayoría de los ecosistemas naturales desaparecerán o se desplazarán de forma integral y posiblemente fatal. Si se trata de eregir por dos días una tienda de campaña, y comer sólo lo que existe en el ambiente, sin dejar rastros de química sintética o productos industriales, la intervención será mínima, y todos los ecosistemas ambientales seguirán su curso, casi sin interrupción alguna.

Para la mayoría de los seres humanos del planeta, la decisión de intervenir o no en un ecosistema ha vuelto una decisión pasiva: las ciudades ya existen, los pueblos ya tienen su huella física y ambiental, y las decisiones de aumentar el terreno ocupado por un asentamiento humano suelen ser decisiones organizadas y municipales, no de un sólo individuo.

Por lo tanto, es fácil distanciarnos del problema sin darnos cuenta del serio y duradero papel que nuestras actividades tendrán en los sistemas naturales de los que dependemos y de los que depende el medio ambiente más extenso. Esta distancia conceptual influye no sólo en nuestro imaginario cultural y económico, sino además en el futuro tratamiento mutuo entre la economía humana y la naturaleza.

Los servicios naturales más valiosas—producción de oxígeno, agua limpia, ritmos y corredores fiables de lluvia, la corriente global del océano profundo—exceden por mucho todo el valor económico de la actividad humana en conjunto. Privilegiar y promover elasticidad y resistencia en los sistemas naturales es la única manera de prevenir los efectos corrosivos a largo plazo de una industria inconsciente de sus efectos.

Un nivel adecuado de elasticidad y resistencia ecosistémicas es necesario para asegurar el suministro alimenticio global y el suministro de agua limpia. Es necesario para asegurar un promedio de estabilidad climático: la diversidad de influencias promueve la estabilidad sistémica a largo plazo; la reducción de influencias promueve precariedad sistémica.

Una referencia útil sería la inversión financiera: un rango mínimo y más uniforme de inversiones expone a uno a mayor probabilidad de fracaso y pérdida de valor total; un rango más diverso y variado de inversiones protege a uno de la inestabilidad de valores y proporciona mayor estabilidad y mayor probabilidad de aumento de valores.

El futuro económico, a escala global y local, depende definitivamente del nivel de elasticidad y resistencia en los sistemas naturales de los que toda la actividad humana depende. La economía humana se funda en la biología, el organismo humano, y las necesidades vitales del conjunto de todos los seres humanos. El medio ambiente es un sistema en el que participamos, y la elasticidad de ese sistema decide nuestra resistencia ante los cambios emergentes o sorprendentes que pueden presentarse en un momento dado.

El ser humano se ha vuelto tan influyente en los proceso naturales que los científicos ahora temen que la naturaleza ha perdido capacidades vitales de resistencia

Futurismo Verde :: En una reunión de científicos europeos, en Estocolmo, el hombre que inventó el término ‘antropoceno’ para describir una nueva época geológica—en la que la influencia humana domina los proceso naturales—ha anunciado que el término ahora se está aplicando desde múltiples campos de estudio. La importancia real del término es que la información ecológica es cada vez más imprescindible para poder llevar a cabo las ambiciones humanas de una forma responsable y sostenible.

The Financial Times, de Londres, ahora informa que “The EuroScience forum in Stockholm heard on Thursday that climate change was the most obvious of a complex range of man-made effects that is rapidly changing the physics, chemistry and biology of the planet.” [En el foro EuroScience, en Estocolmo, el jueves pasado, escucharon que el cambio climático era el más obvio de un complejo tejido de efectos de la actividad humana, que están cambiando rápidamente la física, la química y la biología del planeta."] Otros efectos tendrán que ver con la resistencia de la cosecha, fertilidad de la tierra, elasticidad de habitat vital para especies de sustento.

El alba de la época Antropocena, en la historia geológica, conlleva una cantidad importante de desafíos y oportunidades. En sentido de llevar a cabo una transición rápida de ubicuos modelos económicos a una metodología sostenible, hay una gran oportunidad de aumentar la producción económica potencial de la economía global. Hacerlo, sin embargo, exigirá cantidades masivas de inversión y de innovación acelerada.

Un grupo de 21 de los científicos e investigadores más respetados ha publicado su estudio de la cronología geológica en GSA Journal, y han confirmado que ocurrió un cambio fundamental a una época geológica definida por el efecto humano en el medio ambiente, a principios del siglo XIX. Lo que ocurre ahora, más allá de eso, es que se está desarrollando una conciencia del impacto severo de 200 años de expansión industrial agresiva, incluyendo explotación de recursos, construcción urbana y remodelación terrenal sin precedentes.

Estamos llegando a un punto de inflexión, después del que la ciencia no podrá evitar la necesidad de reconocer y manejar los impactos de la actividad humana en los sistemas naturales. Se ve ahora alteraciones fundamentales en la sedimentación, calidad de tierra, patrones geológicos y habitat biológico, hasta en la misma flora y fauna que habita los sistemas naturales afectados, y en la atmósfera respirable.

Específicamente:

From the beginning of the Industrial Revolution to the present day, global human population has climbed rapidly from under a billion to its current 6.5 billion (Fig. 1), and it continues to rise. The exploitation of coal, oil, and gas in particular has enabled planet-wide industrialization, construction, and mass transport, the ensuing changes encompassing a wide variety of phenomena, summarized as follows. [...]

Humans have caused a dramatic increase in erosion and the denudation of the continents, both directly, through agriculture and construction, and indirectly, by damming most major rivers, that now exceeds natural sediment production by an order of magnitude [...]

Carbon dioxide levels (379 ppm in 2005) are over a third higher than in pre-industrial times and at any time in the past 0.9 million years [...]

The projected temperature rise will certainly cause changes in habitat beyond environmental tolerance for many taxa (Thomas et al., 2004). The effects will be more severe than in past glacial-interglacial transitions because, with the anthropogenic fragmentation of natural ecosystems, ‘escape’ routes are fewer.

Los mecanismos principales de resistencia ecológica se ven erosionados, y el medio ambiente natural se encuentra menos capaz de adaptarse a los cambios en los sistemas naturales y su manera de competir dentro de y entre sí. El estudio también cita evidencia de un nivel acelerado de extinción de especies y de la creciente probabilidad de una ola masiva de extinciones, resultado directo de la actividad humana.

La comunidad científica ha comenzado a elaborar modelos informáticos del sistema natural integral, un complejo de ecosistemas e interacciones a nivel planetario. Esos modelos servirán para averiguar hasta qué punto la actividad humana influye en el medio ambiente y cómo se puede actuar para mitigar esos impactos y lograr un futuro más sostenible, y más capaz de seguir proporcionando los beneficios naturales necesarios como base de la civilización humana.

La idea del periodo Antropoceno es más que una clasificación cronológica del momento en el que nos encontramos. Se trata de una conciencia cada vez más desarrollada de la necesidad de modificar nuestras tendencias para colaborar con los sistemas naturales de los que dependemos tanto para la supervivencia. Es un despertar al efecto que tiene nuestro nivel de vida, nuestra producción y consumo industriales, y a lo que significa la integración de las sociedades alrededor del planeta, en una red global de comunicación y un mercado global de intercambio material y cultural.

Es posible ahora hablar de una creciente conciencia global de la necesidad de cambiar las motivaciones básicas de la política estatal, el negocio privado, el consumo y los mercados en general. Es posible ahora hablar de un momento en el que la evidencia existe para darnos cuenta del poder que tiene la industria de una civilización globalizada sobre el medio ambiente.

La época Antropocena existe porque el impacto medioambiental ya no se trata de un impacto local, en un ambiente limitado, sino de un impacto a nivel global, con secuelas en ecosistemas que no parecen tener contacto directo con la causa de su malestar. El cambio de pensamiento que ahora viene tiene que coincidir con una creciente capacidad de imaginación y colaboración, para dejar atrás la dependencia peligrosa que nos ata a los combustibles fósil.

• Geological Society of America: “Are we now living in the Anthropocene”
• Financial Times / MSNBC: “Scientists warn of a new Anthropocene age”
• About.com Geology: “Introducing the Anthropocene”
• Max-Planck-Institut für Chemie: “Anthropocene” [article that coined the term]
• Resilience 2008: “Resilience, Adaptation & Transformation in Turbulent Times” [Conf., Stockholm 14-17 April]
• Albaeco, Sustainability School: “Masking Environmental Feedbacks”

A return to people-centered investment can motivate the flow of private capital

As I go back and look over what was being written about the economy, and the federal budget, the lost Clinton surpluses, falling wages, and the property bubble, throughout George W. Bush’s second term in office, it is clear the signs were there throughout that a major financial collapse was coming. Many observers, some more astute than others, predicted a correction was in the offing, without having to depend on very complex analysis.

In fact, simple arithmetic sufficed: there was not enough private wealth being generated in the Bush economy to sustain generalized economic growth. Millions of people were not earning enough to pay back what they owed. The mortgage industry was too reliant on refinancing to make existing loans payable—too often, the logic was: take out a second loan to pay your first. Cost of living was soaring while wages were falling, and Bush’s budgets were essentially pretending the two most expensive wars in US history were not real spending.

Now, in 2011, with the benefit of hindsight, we have learned that economic growth was substantially slower, at least in 2008, than we had previously thought. Some defend the Bush administration, saying the numbers could not be known adequately then, that the measures were flawed, or that we have expanded economic transparency generally since then, and so now know more than we could have then.

From The Economist:

ON DECEMBER 16th, 2008, President-Elect Barack Obama met in Chicago with key members of his economic team to discuss their response to the deteriorating economic situation. Just two weeks earlier, the Bureau of Labour Statistics reported that 533,000 jobs had been lost in November, after a decline of 302,000 in October. According to the latest output figures, the economy had contracted by 0.5% in the third quarter, and much worse was expected of the fourth. …

President Obama was inaugurated on January 20th, and a stimulus bill was introduced in the House of Representatives on January 26th. A stimulus package worth $819 billion passed in the House just two days later.

Two days after that, Americans received grim news about the economy: in the fourth quarter of 2008, GDP contracted at a 3.8% annual pace—the worst quarterly performance since the deep recession of 1982.

What we now know, however, is that those reports—which were the mathematical foundation for the American Recovery and Reinvestment Act, and the Obama administration’s belief that unemployment could be kept to 8%—were radical understatements of the economic chaos that was unfolding.

In fact, as The Economist report continues:

Output in the third and fourth quarters fell by 3.7% and 8.9%, respectively, not at 0.5% and 3.8% as believed at the time. Employment was also falling much faster than estimated. Some 820,000 jobs were lost in January, rather than the 598,000 then reported. In the three months prior to the passage of stimulus, the economy cut loose 2.2m workers, not 1.8m. In January, total employment was already 1m workers below the level shown in the official data.

When Obama was implementing the stimulus, the official numbers from George W. Bush’s administration showed negative growth in the third and fourth quarters of 2008 to be 0.5% and 3.8%, respectively. In fact, the reality, never shown to Obama or any top policy-makers in Washington until two years after the Recovery Act was law, was negative growth of 3.7% and 8.9% in the last two quarters of 2008.

Both of those figures were worse than anything seen in nearly 20 years. The fourth quarter decline of 8.9% was the worst since the double-digit single-quarter decline of 1957. And there were very good reasons to worry that GDP was being artificially inflated by anomalous activity: the Pentagon’s record budget, for instance, counts as GDP, but was far beyond any historically normal level, and with two concurrent wars, would eventually have to decline. (The recession of 1945, many believe, is attributable in part to the war-spending bubble deflating as the war came to an end.)

But the question then would have to be: what was really going on in the private-sector economy, if government policies were propping up GDP? Where was household wealth going to come from to fund the record, and rapidly expanding, debt Americans had taken on? How could people get this wealth, if it was not available through wages and other costs of living, aside from credit repayment, were rapidly escalating?

For trained observers watching financial markets, and who had some understanding of the “extreme investing” that was going on, and becoming mainstream, through complex mortgage-backed securities and credit-default swaps, it was clear huge swaths of the financial sector were essentially underfunded and could collapse. The property bubble, however, was visible, and was well understood—and discussed—by prominent voices as early as 2005.

The Economist magazine ran a cover story in June 2005, exploring what would happen “after the fall”, projecting a global collapse in real estate markets, severe economic fallout in Europe and the US especially, the contraction of private wealth generation for most people in those markets, and resulting budgetary shortfalls that could cripple governments and their ability to respond.

Part of the problem is the idea of GDP itself: it is a flawed measure of economic health and wellbeing, because sometimes expansion is illusory or somehow counterproductive, and contraction can be a healthy correction, resetting apparent values to where they actually lie. That something was wrong with GDP measures across the developed world was evident throughout Bush’s second term; what was not evident was how to get out of the mess without inviting economic collapse.

Is that, however, a defense of the policies enacted from 2005 to 2009? In early 2008, when George W. Bush introduced his federal budget proposal for Fiscal Year 2009, his last official budget, there was widespread concern the policies he proposed were reflective of and would invite more sustained economic malaise. He had built into the federal budget record deficits, but had not yet begun counting the wars in Iraq and Afghanistan as budget items—the fear was this would give a distorted impression of the nation’s fiscal health, and might conceal from key decision makers worrying revenue shortfalls that could hamper overall growth.

Interestingly, the longest recession since the Great Depression—it lasted 18 months, from Q1 2008 through Q2 2009—with such deep declines in GDP was over by the third quarter of 2009, Pres. Obama’s second full quarter in office. The GDP growth rates for that period were:

• Q1 2008: -1.8%
• Q2 2008: 1.3%
• Q3 2008: -3.7%
• Q4 2008: -8.9%

• Q1 2009: -6.7%
• Q2 2009: -0.7%
• Q3 2009: 1.6%
• Q4 2009: 3.8%

It is evident that the Recovery Act worked. Economic growth continued steadily throughout 2010, and is weaker now that the stimulus spending is beginning to wind down. There are mounting concerns that massive federal budget cuts will have a depressive effect on the economy, literally withdrawing hundreds of billions of dollars a year in economic output from the domestic economy.

For some, this is healthy and corrective. But to the average American household, it feels very much like a period of prolonged economic malaise. We can blame financial analysts, rating agencies and policy-makers, for creating the economic framework that ignored long-running pathologies and exacerbated the crisis, by using unfunded derivatives, rampant credit expansion, tricky accounting and record Defense spending, to conceal the clues, but it is more important to learn the lessons, to avoid doing the kind of things that impose crisis on ordinary working families and small businesses.

At present, the government has issued so many historic tax cuts, from 2001 right through 2011, that revenues are at historic lows, just 14% of GDP. Budgetary requirements, by contrast, are upwards of 22% of GDP. That is the cause of the record deficits, and much of it is about correcting course from a time of underfunded hyper-exploitation, in which the underpinnings of sustainable economic growth were eroded by flawed theories, flawed reporting of data, unsustainable borrowing and unwarranted gambles.

Total federal government revenue for 2010 was just $2.092 trillion, while GDP for 2010 was $14.66 trillion, so revenues amount to only 14.27% of GDP. With spending at $3.397 trillion, or 23.17% of GDP, there is a resulting stimulus shortfall to the wider economy. The deficits from the Bush years, which helped to conceal the gravity of the mounting economic crisis, have been passed to the Obama years. And now, with BEA revising its reporting for all GDP figures since 2006, in July 2011, it is clear the 2009 stimulus was less than was needed, not more.

The question is: if we were able to see the oncoming economic collapse years before it happened, but we are still living with the legacy of the policies that created it, how can we get back to the healthy growth of late 2009, early 2010, and avoid slipping into another recession? American businesses are sitting on record amounts of cash, and banks enjoy record low interest rates, to stimulate lending, yet neither are putting money into the economy.

A specific kind of policy course correction, then, is needed to motivate significant private investment in new industry, new technologies, and new jobs. It has to be the kind of policy that will not cost taxpayers a lot of money, that gets money from industry profits moving through the consumer economy, and which either before or after achieving that, results in the net creation of millions of new jobs.

There are few ways to achieve this, but there is real promise in the energy sector. Because energy is tied into all other economic activity, which means that virtuous adjustments to how we find energy, how we harvest it, and how we get it to consumers, will ultimately push a cascade of positive impacts through the economy.

According to the Carbon War Room:

Investing $1.3 trillion each year in green sectors would deliver long-term stability in the global economy, a new UN report has suggested. Spending about 2 percent of global GDP in 10 key areas would kick-start a global low carbon, resource efficient green economy.

Since the oil crises of the 1970s, billions of dollars have been pumped into technology development in the areas of energy efficiency, low carbon energy, efficient transportation, bio-fuels, and other areas. This investment has led to hundreds of breakthroughs that are today cost effective. Yet, full commercial utilization of these innovations and their financial rewards still elude us.

What is needed to deploy those breakthrough innovations is for private capital to come off the sidelines and motivate collateral investment in an overhaul of our outmoded energy sector. Clean, renewable energy sources will replace dirty, finite combustible fuels; the question is whether it happens sooner, bringing the economic benefits to more people at a lower overall investment cost, or later, putting off the moment of maximum opportunity.

In many ways, the legacy of the Bush years will be one of putting off the moment of maximum generalized economic opportunity. Much was done to slow the development of rivals to the fossil fuels sector, and unprecedented amounts of money were spent to protect, obtain and propagate the use of fossil fuels. Even the catastrophic deepwater BP oil well failure of 2010, with net cost impact estimates running as high as $100 billion, was the result of a culture of lax regulation and virtually non-existent safety and emergency planning, instituted by the Bush-era Interior Department.

That the signs of impending economic calamity were visible for at least four to five years before the financial collapse of 2008 is an indication of how urgently policy makers need to learn the lesson that all citizens are stakeholders in the outcome of our broader economic policy and that the work of government is to protect stakeholder interest, not shareholder interest.

A confusion of the two may be the leading philosophical driver of the 2008 collapse, as shareholder interest was thought to be inherently virtuous for wider economic prosperity. But in the hyperactive financial markets of 2001-2008, shareholder interest was too often served by practices that ran contrary to the wider interests of sustainable economic growth and generalized prosperity.

If we are to emerge from the Great Recession and its aftermath stronger and more resilient than we were when it set in, then we need to favor government policies that actively consider the stakeholder interests of citizens and incentivize private investment to work for the wider economy. The capture-and-hold profit-making of the Bush years was in many ways illusory and corrosive to long-term economic health; we need real investment, with resilient, optimizing impacts on the consumer economy, so that more people are earning, more people are spending, and more people are building assets and buying power to keep us secure against another collapse.

Recommendations: 

• To Solve the Debt Crisis, Rebuild the Middle Class
• Why We Should Have a National Infrastructure Bank
• Fee and Dividend: To Spur Job Creation, Industrial Boom

TheHotSpring.net :: The debt crisis is attributable to “structural” causes, meaning the way the nation’s financing is structured over the next several decades, but also to political and economic causes, meaning both the way we make policy and the way we live and experience the marketplace for trade, credit and consumer purchases. So, we need to implement policies that make serious, sustainable corrections on all three fronts.

Most of the Republican candidates for their party’s presidential nomination debated last night in Iowa, two days ahead of the crucial Ames Straw Poll, thought to be a leading indicator of which candidates are credible and which are less likely to win in January. Rick Perry, who has not yet announced his candidacy, was not in attendance, and Fred Karger—who met all the criteria for attendance—was not allowed to participate, some say because he is openly gay.

The questions were direct, tough and probing. Challenged on her claim that she could turn the US economy around in just three months, Michelle Bachmann fielded the first of many tough questions. She backtracked somewhat, claiming that she could not fix the economy in three months, but that she could enact policies that could eventually have a positive impact. She then trailed off into a “one term president” rant against Obama, which opened her to the critique that her policy plans lack substance.

Mitt Romney attempted to deliver an economic-policy stump speech. He launched into a Republican talking point, calling for a steep reduction in “corporate tax rates”, which are either the lowest in the industrialized world or the highest, depending how they are defined. He called for energy independence, suggesting new drilling, but not openly saying so, and vaguely said we need “the rule of law” to shore up our economy.

Romney’s reference to “rule of law” struck many as odd and off-topic, in part because the Obama record has been one of trying to force major corporate interests to follow existing law and end the regulatory non-action of the Bush years. But Romney’s meaning was far more likely to be about taxes: he has been facing criticism for having “raised taxes” while governor of Massachusetts, but has said he was able to bring in “new revenues” by “closing loopholes”, i.e. enforcing the law.

Former Minnesota governor Tim Pawlenty got off to a very rocky start, showing either plain ignorance of active government policy and recent political history or a willingness to tell very big fibs in order to make difficult rhetorical points—alleging that Barack Obama has never presented a plan to reform Medicare. The Patient Protection and Affordable Care Act—which Pawlenty likes to call “Obamneycare”—included Medicare reform specifically designed to cut $500 billion of “waste, fraud and abuse” from Medicare, without reducing benefits or access to care.

In fact, while it achieves those cost savings, it also establishes that no insurance managers, public or private sector, can interfere with doctor-patient decisions on appropriate course of treatment. So Pawlenty missed the mark dramatically, while saying little about his own plan, getting the facts wrong and leading research-minded voters to look up Obama’s already in place and very specific Medicare reform plan. The president has called for an expansion of that reform plan, again without cutting benefits.

Rick Santorum announced his plan to “cut the corporate tax rate to zero, for manufacturers”, and he did so with a smile, as if anticipating major new corporate financing for his campaign. Santorum seemed eager, throughout the night, to glisten with new ideas of this kind which he hoped would capture new support and new momentum, going into Saturday’s straw poll.

Chris Wallace—who consistently asked aggressive, difficult questions—asked Pawlenty if Bachmann was really unqualified, as he had claimed, and had no achievements, but he added the quip that Pawlenty might be attacking her simply because “she’s beating you in the polls”. Pawlenty repeated that her record is simply lacking, that she has no accomplishments at all as a legislator.

Referring to the Bachmann’s catch-line that she has a “titanium spine” and will never relent on her ideological demands, Pawlenty said “It’s not her spine we’re interested in; it’s her record of achievement.” He then addressed her directly, saying “If that’s your view of leadership with effective results, please stop, because you’re killing us,” implying that by sabotaging deals that get much of what Republicans seek, she is losing the wider policy war for the party.

Romney faced his toughest question when he was challenged on his record at Bain Capital, which acquired American Paper, closed two plants, and imposed 2,000 layoffs. Romney says not all of the companies Bain invested in while he was there worked, and so some had to fail. He sought to paint this record of experience as an education in what works to allow businesses to grow and create jobs, but he offered no specifics on how that education would play out in presidential policy.

Wallace asked Gingrich if his record on the campaign trail—top advisers resigning en masse—shows he is not fit for the presidency. Gingrich bristled and decried what he called “gotcha questions”. He criticized the press corps generally, for focusing on “campaign minutia” and ignoring the basic ideas that distinguish Republicans from Pres. Obama.

He made the most specific policy suggestion of the evening, saying the government should make “Lean Six Sigma”—a combination of Toyota’s Lean manufacturing model and Motorola’s Six Sigma production process—the national manufacturing standard.

He asked Huntsman if his record of service as Barack Obama’s representative to China means he is not a true Republican. He said he is proud to serve and that when your country calls, you step up and serve. Huntsman repeated throughout the night that he is proud of his record of public service and that he believes that experience is the best sign that he is prepared to be president.

Herman Cain was asked if his extreme statements—like calling on communities to ban mosques—and saying he knew little about the war in Afghanistan made him too ignorant to be president. Cain seemed to agree with Gingrich’s critique of unfair questions, and said he has learned, that as a businessman he knows the ability to learn and to develop more complex understanding of such complex issues makes a good leader.

On immigration, Cain said legal immigration is the already existing and appropriate “path to citizenship”. In what might be his most memorable remark of the campaign, he artfully threaded the needle of ethnic and ideological tensions relating to immigration, saying “America can be a nation with high fences and wide open doors.”

Gingrich took an extreme tack to the hard right, calling for moving millions of people to the southern states to police the borders, the establishment of English as “the official language of government”—a radical position that ignores the First Amendment and holds that we will not inform anyone who does not understand English of their rights, or what they may need to do in an emergency.

Gingrich also added that he would “distinguish between people who have been here a very long time and people who have come more recently”. This last comment seemed to some to mean he would allow for something like amnesty for those who have been here longer, while others were chilled by what seemed to be a nativist rejection of immigrants’ rights.

Romney was asked about how he used new revenues to fix the Massachusetts state budget, and whether he would raise taxes to balance the budget. By simple arithmetic, it looks nearly impossible to balance the federal budget any time soon without raising taxes, but Romney defended his record in Massachusetts, explaining that he balanced the budget every year, and that he only needed to close loopholes, not to raise taxes, while imposing sharp cuts.

Pawlenty was asked about his having increased the cigarette tax in his state, in order to balance the budget. He made reference to whether it was a “fee” or a “tax” and to court rulings on the subject, and said he would later regret having done it, but it seemed clear that this was instrumental to his budget policy and a sticking point that could be to his favor or to his disadvantage, depending on whether GOP primary voters include the majority of Republicans who favor raising revenues to balance the budget.

Bachmann said she had opposed the cigarette tax hike, when she was in the state legislature, and that she was determined not to support it. But she did in fact vote to increase the cigarette tax. She claimed Pawlenty forced her to do so, by attaching a rider that would “protect the rights of the unborn”, so that she was forced to choose between voting against rights for the unborn and voting to raise taxes.

Bachmann said her view was that you can get things wrong when it comes to money but not when it comes to life. The exchange, however, seemed to play into Pawlenty’s argument, that he is better at getting results than Bachmann, who is a hapless prisoner to her own ideological priorities, and who—despite this, and contrary to what she says—will vote against her principles.

Rick Santorum, former senator from Pennsylvania, appeared to agree with Pawlenty’s critique of Bachmann, saying that a leader needs to know how to get a good deal and get results. Santorum sought to tout his record of “leadership” at the state and federal level, and argued that he was better able to serve the conservative ideals than Bachmann, because he knows how to negotiate.

When the question was posed if the candidates felt so strongly about opposing any increase of any kind in tax rates, would they oppose even a deficit reduction deal that made $10 in cuts for every $1 in new revenues, every member of the debate panel raised their hands. After-debate analysis suggested this moment may become “iconic”, indicating that the Republican party is only interested in tax cuts, not in deficit reduction, fiscal responsibility or protecting Medicare and Social Security.

The image of the Republican candidates dutifully—some with reluctance—raising their hands to support Grover Norquist’s radical anti-tax pledge could become the signal moment of the primary campaign, when Republican candidates announced their intention to enforce the tea party radical position of obstructing deficit reduction in order to prioritize tax breaks, at a time of historically low tax rates, perilously low revenues and escalating debt.

Santorum took issue with Ron Paul and Michelle Bachmann’s reference to the 10th Amendment, and the question of states’ rights, saying their theories were “the 10th Amendment run amok”, and that “Our country is based on moral laws, ladies and gentlemen. Abraham Lincoln said the states don’t have the right to do wrong.” It was a moment of passion and principle that stood out, but which will require Santorum to make clear how he would deal with issues like same-sex marriage or abortion, where prevailing law conflicts with his views.

Asked about the entrance of Rick Perry into the race, Ron Paul said Perry “represents the status quo” and that he will make Paul’s own unique views stand out more. Herman Cain agreed, saying Perry would dilute the vote for “politicians” and make his business record stand out. Bachmann said there is room for another conservative in the race, though many strategists believe Perry will cut into her vote-getting ability.

Newt Gingrich was asked if he has a clear vision of what should be done in Libya, after taking two diametrically opposing views within a few days, at the start of the conflict. He said he recently spoke to Gen. Abizaid, who speaks Arabic, is one of the foremost security policy experts on the region, and who said we have a “strategic deficit” that needs to be closed through intelligent, persistent diplomatic engagement.

In what is perhaps an interesting angle, politically, Abizaid has been a supporter of the Obama administration’s diplomatic efforts in the region, which taken with Gingrich’s characterization of the state of affairs, suggests the Obama administration’s policies are potentially closing that deficit.

Gingrich did not offer a clear policy position on the current situation in Libya, but complained that the press were criticizing him for Pres. Obama’s having coordinated a humanitarian crisis response in Libya.

Huntsman was asked what it meant that China has been hacking into US corporations and US government servers. He said he has long experience with China, and believes the United States needs to have a robust, informed, collaborative and secure relationship with the rising world power. He also said it would be naïve to expect China not to behave like a rival, and that we nee a president who understands the relationship.

Ron Paul decried sanctions against Iran, saying that military threats and sanctions are precursors to real military conflict, costly policy mistakes and would only worsen the security situation worldwide. Paul believes that foreign wars that are not of absolute defensive necessity are contrary to democratic values, undermine the principles of liberty and create enmities that would continue to threaten US interests far into the future.

Cain was asked by Wallace about his comment that US energy independence would be the best way to prevent Iran from obtaining nuclear weapons. The suggestion was that it might be irrational to claim that drilling for oil in North America would persuade Iran’s hardline regime not to develop nuclear weapons. Cain explained that he views economic policy as one element of a complex foreign policy, where economic pressures can be brought to bear to incentivize the behavior of even extreme governments.

When Ron Paul was asked why he disagreed with Michelle Bachmann’s view that accused terrorists should not have due process rights, he said “she turns our rule of law on its head.” Paul explained that for individuals accused of terrorist activity to be treated as terrorists, “They have to be ruled a terrorist. Who rules them a terrorist?” He said the Constitution requires due process and a court ruling based on evidence. Bachmann, he said, is rejecting the rule of law and the traditions of American democracy, instead proposing “mob rule”.

Santorum said that under the regime of the Shah, the Iranian people were “free”—disregarding the police state, disappearances and torture used by that regime. He then complained that the “mullocracy” in Tehran “tramples the rights of gays”—a remark that surprised many, given his relentless pursuit of a national ban on same-sex marriage.

Gingrich was asked why he proposed a “loyalty test” for any Muslim that might serve in his administration. He said he would impose a loyalty test on every person who would serve in government, but gave no specifics as to how that test would be carried out. He cited incidents of Cold War espionage, where people that seemed above suspicion turned out to be foreign spies, and one case where an alleged terrorist conspirator said he “lied” when asked how he could take an oath of loyalty and then behave as America’s enemy.

Herman Cain was asked what it was he believes southerners “find objectionable about Mormonism”? He said that he, personally, has no problem with it, but that he believes many southerners simply don’t understand how Mormonism fits into the culture of protestant Christianity that they are familiar with.

Asked about her having said she hated her husband’s idea that she should study tax law, “But the Lord said, be submissive. Wives, you are to be submissive to your husbands,” Rep. Bachmann seemed genuinely embarrassed and stunned. She paused for an uncomfortable length of time, then offered the explanation that she meant by this term “respect” and that her husband respects her as well.

Romney may have waded into waters that will hurt him in the general election, when he shed the moderate tone of his campaign, saying “our marriage status relationship should be consistent at the national level” and he supported a national law to define marriage as between a man and a woman. He justified this by expressing concern that some same sex couples might have a hard time divorcing if they are in states that have different marriage laws from those where they married.

Huntsman supports civil unions, and spoke of “reciprocal beneficiary rights”. He said “I believe in traditional marriage, but subordinate to that, I believe that we haven’t done a good enough job at equality.” This helped to define Huntsman’s position as the true moderate conservative in the field, and a pragmatist. Many critics have been wary of the conservative candidates’ unwillingness to admit that any injustice could be in need of correction that does not need conservative ideological solutions.

Paul took a position that many find hard to grasp, given his arch-libertarian tendencies. He said “just so long as they don’t impose their vision of marriage on you”, that his priority was to ensure that no one had their private life defined by the government. This was in line with his libertarian principles, but he also specified that he believes marriage should be between one man and one woman, a concession to the conservative ideology he is known for criticizing.

Bachmann offered the awkward statement that “I have an absolutely unblemished record when it comes to this issue of man-woman marriage”. She has not supported same-sex marriage, certainly, but there have been questions about “blemishes” to her record, including alleged support for the extreme and discredited “treatment” option of prayer to cure homosexuality. Questions have also been raised about whether she and her husband have been spokespeople for this policy.

Romney may have made his most significant slip-up of the night—in line with his statement the previous day that “corporations are people”—when he said that “We’ve got to find a way to reduce our spending on a lot of anti-poverty programs”. He said this in responding to a question about whether he would extend unemployment benefits.

Romney has sought to blame both general economic pathologies and the president’s policy response for prolonged unemployment, which would suggest those who are suffering the impact are not in any way responsible for their predicament, so his admonition that in times of economic hardship the government should roll back its anti-poverty efforts seemed more than a bit awkward.

He said he would “go to Congress with a new plan for unemployment benefits”, but that he would not extend the current program of unemployment benefits. He was not pressed on what he would do should Congress fail to give him the option he prefers.

Huntsman took issue with the regulatory system and made what might be his most immoderate policy assertion of the night, saying that “If you want to build a facility in this country, you can’t, because of the EPA’s regulatory reign of terror“. He was defending the Huntsman company’s chemical operations, and by implication was suggesting chemical plants need more leeway to release dangerous toxins into the environment.

The use of the phrase “reign of terror”—a reference to the French revolutionary period and a campaign of torture and mass execution of “enemies of the revolution”—echoed the much maligned rhetoric of bloodshed and exaggeration increasingly used by Republicans since the summer of 2008, and through the 2010 elections. Huntsman did not backtrack, but repeated his allegation of a “reign of terror”, without giving any specifics about how that “terror” was imposed.

Newt Gingrich was asked to explain why he does not favor Ron Paul’s demand that the Federal Reserve Bank be “abolished”. “Having some sort of central bank”, he said, is necessary for dealing with the money supply “in the modern world”. He added, “I think the fact that the Fed is secret is a scandal” and repeated his demand that the Federal Reserve Bank be audited, that its books be open to public scrutiny.

Ron Paul celebrated what he called an awakening of the mainstream to the need to audit the Fed, but said we need to phase out the Fed, and that it is important to “understand the business cycle” in order to prevent recessions.

On education, Huntsman was firm, saying “No Child Left Behind hasn’t worked for this country; it ought to be done away with.” He called for a greater emphasis on governance at the local level, and said there is no one so interested in schools succeeding as the communities they serve. Herman Cain seconded this response, saying he would abandon NCLB and focus on local control of schools.

Huntsman added that he stood against letting the nation default, because the United States is 25% of the world’s GDP and by far the largest financial services industry in the world. This was a critique of the radical factions in his party, including Bachmann, who have said that they believe default could be beneficial for long-term fiscal solvency, acting as a kind of spur to activate serious budget reform.

The debate showed new rifts between and among the candidates and allowed them to stake out certain clear positions: Gingrich emerged as the “ideas” candidate, demanding that everyone focus more on ideas and less on rhetoric, style and the “minutia” of what goes on along the campaign trail. Romney sought to remain largely above the fray, and managed to do so, but gave few specifics. Ron Paul staked out a position of radical reform, in language many voters support.

Herman Cain talked up his business record, but mostly offered what he considered common-sense ideas. Rick Santorum promised bold leadership, offered some radical positions on taxation, and confounded some of the most problematic critiques of his ideas. Huntsman stood as the principled moderate, and a conservative problem solver.

Bachmann was on the defensive, but was poised; she moderated some of her most hardline views, but gave few specifics. Pawlenty became something of an attacker, and began what could be the most effective argument for his campaign: getting things done. It was not clear if anyone “won” the debate, though Romney, Bachmann and Gingrich were all given praise for their demeanor, for different reasons. Pawlenty may have made a dent in Bachmann’s armor, however, and some now expect him to be a tougher campaigner.

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Report and analysis from Independents of Principle

TheHotSpring.net :: With the objectivity and commitment to fact of S&P now seriously in question, and allegations now revived that it and other rating agencies were paid to give AAA ratings to junk securities derivatives, it is clear that we need a 100% not-for-profit (NFP) cooperative bond rating agency. The independent NFP agency could be one of several, staffed by top economists, stakeholders and public servants, and standing somewhere between the public and the private sectors.

The role of such a new cooperative agency would be to take the profit motive and the complication of day to day financial dealings out of the rating agency portfolio. While Standard and Poors is owned by the publishing conglomerate McGraw Hill, its analysts have been accused of incestuous relationships with the entities they are tasked with rating, sometimes taking huge profits in financial services fees while evaluating risky products put out by their patrons.

A not-for-profit rating agency would allow for greater transparency, a more aggressive process of analysis, and more unbiased foundation for that analysis. It would allow for a wider-ranging and more flexible input of data to ensure that evaluations correspond in some clear way to genuine long-term value. It would, in short, ensure that private interests don’t interfere with the straightforward process of factual analysis.

It would also, maybe more than any other single factor, help to contribute to a virtuous cycle of transitioning back toward separation of interests, diversification of markets, and decentralization of financial sector influence and wealth creation. How would this benefit society at large? It would allow for a more democratic, more evidentiary, more pragmatic reading of bonds and other financial services products.

The first step is to remove the profit motive from the evaluation process. The reason for this is that the assumption that narrow profit motives somehow spark virtuous behavior, “efficiency” and “performance” loses relevance when the incentive to produce a given rating—like AAA on high-risk subprime mortgage-backed derivatives—conflicts with the evidence-based analysis, which indicates that there is no way that product can be a safe bet for most investors.

- – - A brief aside: The same can be true in reverse: a bond rating agency that made such catastrophically bad misjudgments when there was a conflicting interest in play could seek to be more aggressive, in a highly visible way, to restore its reputation for seriousness of purpose, when—by coincidence—there is no direct accounts receivable windfall in play.

There is enough room for doubt that on the first day of trading since S&P’s downgrade of US Treasury bonds, those same bonds have hit an all-time record for demand, as investors seek shelter in the very product that was just downgraded. That suggests the S&P evaluation was flawed, or was issued for mathematically inconsistent reasons, or simply that—as one analyst suggested today—their poor performance during the mortgage bubble has left them less relevant and less well regarded generally. 

Paul Krugman, the Nobel Prize-winning economist and New York Times columnist, wrote today that “they may be a prestigious organization for some reason, but their track record is ludicrously bad.” In fact, he is not the only prominent economist expressing concern that the Wall Street firms and the financial services sector more broadly are becoming perilously divorced from the wider economy. – - -

The American economic system has artfully grappled for generations with the problematic tension between narrow, well-funded interests, and the wider landscape of stakeholder interests. A strong regulatory system and vibrant democratic marketplace have been able, periodically, to rein in abusive behavior and make it visibly profitable for powerful interests driving economic behavior to line up their interests with those of the wider economy.

Some now believe that time may have passed. A generation’s worth of deregulation and financial experimentation have led to the widest wealth gap since before the Great Depression, and credible economic analysis suggests the stagnant economic trendlines are the result of having a post-Depression system, with meaningful checks and balances, and a Depression-era economic dynamism. In other words, we should be experiencing a depression, but we have deployed failsafe measures to make it less likely.

The stakeholder problem is a very real bone of economic contention, and very much worthy of close scrutiny. Where financial instruments are based on bad investments, then pitched as good investments, and tens of trillions of dollars in private wealth evaporate, even the most minute activities within the financial services sector have high-stakes consequences for people and institutions throughout the economy.

A genuinely useful, wholly relevant and economically optimally constructive rating system requires real independence. It requires a commitment to fact, and a commitment to economic balance and generalized prosperity. It requires a substantive, transparent measure of the major economic drivers that induce periods of “irrational exuberance” for bad investments, which by extension bring widespread economic hardship in their wake, when banks shut down many of their financial support services to the middle class and small businesses.

The proposed NFP cooperative bond rating agency would be:

• fully independent of ties to Wall Street firms;
• required to publish source material and white-paper reports detailing internal discussions;
• required to publish information regarding all meetings with any interested parties;
• focused on stakeholder interests across the economy;
• responsible for public comment fora, at least one per month, to gather anecdotal guidance;
• staffed with independent economists, former financial services professionals, public service veterans—each without active ties to interested parties;
• required to pay only base stipends, with no bonuses except for consistent accuracy over the long term;
• a model for similar NFP financial analysis projects.

The four central ideas motivating this new model, and which should then be emulated by competing institutions are:

1. eliminating professional conflict of interest;
2. comprehensive transparency of process, sourcing and aims;
3. focus on overall stakeholder interest;
4. reliable precision, based on health modeling, not profit forecasting.

The simplest way to institute a project on this scale, with this level of responsibility and in a visible enough way to give it active influence and long-term viability is, of course, a public-private partnership. It should be funded in part by the federal government, and in part by the financial services sector, and top schools of economics should hold competitions to bring on board some of the world’s most visionary, flexible and precise economic minds.

The process should begin this fall and winter, with the goal of holding public hearings for the creation of the first independent NFP cooperative rating agency in the spring and fall of 2012. The fully functional institution could be active by the end of 2012, in time to play a constructive role in the landscape of analysis surrounding the 2013 negotiations on the 2014 federal budget, and the financial planning of major banks, insurers, governments and industry.

creative prosperity is sustainable prosperity

To build a future of vibrant open democracy and robust and sustainable economic prosperity, it is necessary to privilege creative activities and constructive solutions to the challenges we face. Addressing major challenges in constructive, innovative ways, is the single most significant driver, historically, of sustained economic booms. In short, we need to move deliberately and swiftly toward a creative prosperity agenda.

The first consideration, then, is to examine how the creative prosperity agenda would differ from what we are doing now. At present, we are wrestling with the complex fabric of consequence related to long-running economic distortions, most of which we have not yet corrected. Healthcare reform and financial regulatory reform were comprehensive in scope, but moderate in impact, cautious and rooted in the prevailing model; energy reform needs to move forward rapidly and do more to prioritize innovation.

We are facing a major, civilization-wide transition from one way of conceptualizing political and economic power to another. We stand at the dawn of what should be the global solidification of open democracy as the standard for elevating and defending human dignity and freedom of thought. But we need to build creative prosperity into that future, and this will require a fundamental shift in the dominant view which holds that power is more effective when concentrated in fewer hands.

That view comes from ancient times—from prehistoric times, in fact—when the governing principle of human life was the need to survive in competition with forces far more powerful than any one individual, family or band. Power, then, was a combination of accumulated resources and raw force. In that light, power is a destructive force, requiring intense concentration of resources and the ability to draw a line between the inside and the outside of the power circle.

the feudal (concentration) model

Economically, the fact of human society was that there was not enough technology, enough resources, enough liberty, to deliver real comfort to most or all people. In fact, there was only the material wealth to deliver substantial comfort to about 1 in every 100 people. The model of concentration allowed those in that 1 percent to cling to comfort and fight off would-be attackers.

The only way into the circle in which power, means and comfort were concentrated was to pay the toll for access. That might be done by force of arms, or by handing over significant sums of wealth. Paying the toll perpetuated the model, and won significant privileges for those who helped to make sure that system remained viable.

This developed eventually into authoritarian empires and the medieval elevation of aristocracy. The logic of the model of concentration held: those inside the circle must remain there, and the society must be organized to keep them there. They were, it was presumed, worth more than other people, and so they were able to treat their privilege as if it were part of a life of service—maintaining law and order—to those with less.

the democracy (decentralization) model

Modern democracy posits an entirely different model: the model of decentralization. Modern democracy, according to the ideals of the American revolution and the French revolution, requires a comprehensive departure from the status quo of feudal dominance. It requires the engineering of a model for economic and political activity whereby power cannot be concentrated, and where excessive concentration of power brings disadvantage.

A creative prosperity agenda for public policy and economic renewal would put aside the bias of the old model, once and for all, asking enterprises large and small to join together in a fabric of imaginative competition, prioritizing localization, innovation and service value to the marketplace. It would help to recapture the energy of modern democracy, wherein monopolies and juggernauts sputter and trudge, slowed by their weight, and individuals and small businesses are better able to take the field, to effect positive change, to feed a generalized economic expansion.

The key to that model is the vibrancy of an expanding and upwardly mobile middle class. Achieving that means doing what the United States did so effectively in the 1950s and 1960s, decentralizing the levers for creating wealth, allowing more free people to participate not only as citizens but as leaders and entrepreneurs.

losing our former focus on creative (decentralized) prosperity

A period of intensive deregulation in key industries has led the United States’ economy into a period of prolonged slow growth, because it has led to the hyper-concentration of wealth and of access to the levers of wealth-creation generally. Average household income has dropped by about $2,500 since 2000, even as the gap between average pay and the earnings of the wealthiest has expanded to historic highs.

There is a problematic knock-on effect of this, which is that innovation is no longer a priority, as major conglomerates seek first of all to secure their position. Upstarts like Apple are not emerging at the rate they were during previous periods of economic expansion, and the most powerful, most concentrated interests—Apple now among them—are controlling the field of play.

recapturing momentum: how to build a creative prosperity agenda

There are a couple of key changes that need to take place to move toward a creative prosperity agenda:

1. Move from a bias favoring large conglomerates to one against them;
2. Move away from subsidies for high-polluting, low-yield fossil fuels;
3. Move toward clean energy technologies that favor rapid innovation, brainy startups, more robust job creation, and local economies;
4. Revive national commitment, public and private, to infrastructure redevelopment;
5. Provide direct tax credits for real job creation (payable on a per-job basis);
6. Establish sustainability incentives for municipalities (ref: Sustainable Jersey), states and businesses;
7. Establish an aggressive Renewable Portfolio Standard;
8. Prioritize higher education spending, including post-graduate studies incentives for businesses looking to sponsor their employees;
9. Introduce critical thinking, macroeconomic studies, engineering basics and public policy debate, to public high schools—judge these as more valuable than test scores;
10. Make sure tax reforms are not regressive; make sure they prioritize family and community-level “thriving”, i.e. asset-building, quality of life and spending power;
11. Tax derivative financial instruments at a higher rate than direct capital investments in enterprise, innovation and hiring;
12. Apply national policy to correct market distortions relating to fossil fuel costs.

The outcome of this process of reform would be:

• accelerated, more widespread innovation;
• entree for creative small business models;
• unprecedented opportunities for sustained hiring;
• more vibrant, resilient local economies;
• a consumer-centered smart electricity grid;
• cleaner air and water;
• a sustainable economy where growth is not tied to the promotion of vast negative externalities;
• more robust civic engagement from citizens, communities and creative thinkers…

The United States is perfectly capable of achieving this kind of virtuous cycle between democratization, decentralization, creative thinking, entrepreneurship and the expansion of the middle class. But substantive policy changes need to be made—to remove the incentive for corrosive activities that favor the unhealthy concentration of wealth and productive capacity and motivate the revival of generative activities that favor the healthy decentralization of assets and productive capacity.

A vibrant middle class—where the best ideas can come to the fore and be implemented and the dignity and worth of citizens and communities takes priority over the naked pursuit of profit—is better suited to fostering creative, sustainable prosperity. The first step is to recognize where we favor profit over people, and then work to change the prevailing model and free human creative talent to achieve that goal.

Critics express concern Perry is supporting groups that promote hate, seek a totalitarian theocracy to replace Constitutional system

There is dispute as to whether attendance at Gov. Perry’s prayer rally was 30,000, as organizers claim, or 15,000, as other news sources have estimated. Observers have expressed concern that the event featured radicals whose views oppose the constitutional order of the American political system, and who have called for the establishment of an absolutist theocratic regime.

The following report from Suite101 is indicative of the concerns being expressed by people across the political spectrum:

Possible 2012 GOP candidate Rick Perry was a hit with the 15,000 gathered for August 6, 2011 prayer meeting held in Houston.
Rick Perry, who is eyeing a run for the Presidency in 2012, may eventually have to distance himself from his more extremist Christian supporters. The trouble is that Perry needs the support of the American Family Association, which sponsored Perry’s allegedly non-political prayer meeting called The Response. An even more troubling possibility is that Perry may be in full agreement with their Reconstructionist plan to take down the Federal government and create a U.S. theocracy, under Biblical law.

Christian Extremists

The idea that Christians should physically overcome their enemies and rule in righteousness is not new in the United States, and the current thread of theocratic Christian Reconstructionists goes back at least to 1948. The movement has operated under various names such as the Latter Rain movement, Joel’s Army, the Manifest Sons of God, and now the Seven Mountain Mandate.

Conquer and Occupy Public Institutions

According to Chip Berlet, writing in the Huffington Post, “Christian Reconstructionism is a form of theocratic dominion theology…The core theme of dominion theology is that the Bible mandates Christians to take over and “occupy” secular institutions.” Dominionists and followers of the Seven Mountain Mandate came to public attention in 2005 when a video of Kenyan Pastor, Thomas Muthee anointing Sara Palin for leadership, was uploaded on Youtube.

One group participating, in particular, has been cited as an extremist organization, founded on the missionary promotion of intolerance and prejudice. According to People for the American Way, the so-called American Family Association has:

• held gays responsible for the Holocaust and likened them to domestic terrorists and Nazis who are intent on committing “virtual genocide” against the military, and asserts that “homosexuals should be disqualified from public office”;
• said “we have feminized the Medal of Honor” by awarding it to a soldier who saved his fellow combatants rather than killing enemies;
• demanded all immigrants “convert to Christianity” and renounce their religions;
• asserted that Muslims have “no fundamental First Amendment claims” and should be banned from building mosques and deported from the US, adding that Muslims are inherently stupid as a result of inbreeding;
• claimed African American women “rut like rabbits” due to welfare and that Native Americans are “morally disqualified” from living in America because they didn’t convert to Christianity and were consequently cursed by God with alcoholism and poverty;
• said that the anti-Muslim manifesto of the right-wing Christian terrorist who killed dozens in Norway was “accurate.”

The Dallas Morning News has reported that Perry’s affiliation with extremist organizations, and his radical policies, which have undermined overall economic progress for the population of his state, are driving Democratic party views that he is a deeply flawed candidate, too far out of the mainstream to be electable nationally. From today’s DMN:

As Rick Perry gears up for a presidential bid, Democrats also are making preparations — dusting off years of opposition research, sharpening attack points, designing anti-Perry websites and, for the most part, awaiting his entry with more eagerness than anxiety.

They’re not trying to tip the GOP primary. But in seeking to tar Perry as a flawed extremist, they want to ensure that as voters beyond Texas get to know him, he won’t be able to shake that image later.

“He has a pretty poor record as governor of Texas on a lot of measures — on wage growth, on job growth, on health care,” said Bill Burton, head of a new pro-Obama political action committee, Priorities USA, and until recently the deputy White House press secretary.

He called it “fairly amazing” that a quarter of Texas are uninsured, and that Perry wanted to opt out of Medicaid and “suggested secession as a remedy to the health care bill.”

The secessionist narrative is particularly disturbing to many in both the Republican and Democratic parties. Perry is seen as a wild-card that would not be likely to take responsible positions on the direction of national policy, and who might bring fringe ideas into the heart of the American government.

At a time of severe economic difficulty, there is concern Perry’s often rosy-eyed commitment to market-distorting deregulatory policies could deepen and prolong the years-long economic slowdown. His state has one of the nation’s most massive budget deficits, and no substantive plan to address it, other than cutting back on needed public services, and economists are now starting to look at whether the extreme positions and under-thought policy approaches might pervade his economic policy strategy.

The news today seems to indicate that while Rick Perry may have shored up a radical segment of the evangelical vote, he has succeeded in casting himself as an ally to extremists with little regard to the perils of programmatic intolerance and discrimination.

IndependentsOfPrinciple.com :: What’s wrong with the stock market, particularly the New York Stock Exchange and the Dow Jones Industrial Average? The most significant problem facing the stock market is really a confluence of two problems: 1) we have too little middle class wealth, and so too little consumer demand, and 2) we face an urgent need to accelerate the transition to a new economy, but we are focused on trying to revive an old economy.

On Thursday, August 4, the Dow Jones Industrial Average dropped almost 513 points, losing 4.3% of its total value, the worst one-day decline since December 2008, and an effective reversal of 8 months’ worth of gains. It happened two days after the United States avoided a default by raising the debt ceiling and cutting government spending by about $250 billion per year over the next 10 years.

Analysts differ over whether the massive stock sell-off is attributable to concerns about an impending default by Italy, or whether it indicates some sort of deep weakness suddenly revealed in the dealings of American banks. What is evident, however, is that with massive cuts in government spending planned, the nation’s leading industrial corporations may lose needed funding and/or incentives for new investment.

The Dow Jones Industrial Average measures the collective value of 30 leading publicly traded industrial corporations. It is rooted in a 19th-century industrial economic model, in which the value of these firms grows as the wider economy is developed. In a fully developed post-industrial economy, connected at countless points of contact to a global marketplace, and driven by consumer behavior, there are obstacles to modeling economic health in this way.

But beyond the power and relevance of the Dow Jones Industrial Average, stock indices in general are prone to certain inherent flaws that can incentivize the slowing or even reversal of trends that would be healthy for the overall economy. This is because they favor already powerful entities, and are often ill equipped to measure or reward activities that substantially disperse wealth creation.

Stock indices are at best an indirect measure of capital decentralization, because they measure its centralization, albeit in a way that could, if all other conditions are right, result in more people gaining access to the levers of capitalization and wealth creation. In other words, the best-case scenario is: if everyone gets in, and makes the same bets, and most people keep up, then maybe most people get richer. But that is not the point, and the indices don’t even attempt to tell that story.

When banks come to depend on the commonly held belief that they control wealth that does not in fact exist, the possibility of wealth being decentralized in a way that drives consumer spending is greatly reduced. It has to be, because to meet the demands of their own fictional wealth claims, banks must persuade others, i.e. many or most people, to take on unsustainable debt.

Ultimately, this practice drives the deployment of still more unsustainable debt, and deprives consumers of too great a portion of their wealth, cutting into economic output, slowing economic growth and impeding hiring. This is where we find ourselves, and the banks, investment firms and major industrial corporations, are sitting on massive real wealth, waiting for government to somehow force consumer spending higher.

But the summer of 2011 has seen two worrying trends that make it less likely government can motivate new growth: the United States has committed to removing $2.5 trillion in government spending from the economy, over ten years, and multiple eurozone countries appear closer to default than before the US debt ceiling debacle.

Austerity plans in the US and the EU now threaten to destabilize major western commercial markets, even as investors grapple with the shift toward more volatile consumer markets in Brazil, Russia, India and China, sometimes grouped together as the “BRIC” bloc. Much conventional industry is still heavily invested in mineral fuels, a dependency which could lead to cost swings so severe as to limit investment of even huge pools of cash in reserve.

So, what is wrong with the stock market? It is viscerally linked to trends that no longer support sustained unlimited expansion. The fabric of our global economy, and the technologies and innovations that make it work, have evolved so far as to work, in many ways, against the continued expansion of the specific values counted by the various stock indices, given the way they are counted.

We need a more astute, more precise, more direct and versatile way to read the economic landscape that offers up the best opportunities for investment. We need to consider and then to integrate into our planning and our value judgments real measures of generalized quality of life, corresponding to household autonomy, individual career choice, and opportunities for asset building and middle-class entrepreneurship. And then we need to find ways of measuring these indicators that actually drive the underlying economic reality to improve.

We need to remember that not everyone trades stocks and bonds for a living, not everyone is hoping banks and insurers can continue to reap major profits without providing consumer-centered service, real wealth expansion and a more resilient foundation for sustained prosperity, and not everyone is served by a system that focuses on concentrations of wealth near the top of the income ladder.

We need to stay global in our thinking, and make sure we are inspired by the aim of building a robust, democratic society; the middle class will thrive if we do.

Gov. Rick Perry (R-TX), who is reportedly contemplating a run for the presidency, will be attending an evangelical prayer service on Saturday, labeled “The Response”. Perry has been heavily criticized for his participation, both by critics who say the event violates his constitutional oath to treat all Texans equally and by groups like the Anti-Defamation League, which is concerned about the hate-based policies of some of the event’s backers.

According to CBS News:

A number of controversial groups and individuals are linked to the event, including the American Family Association, which is providing financial backing; AFA representatives have called for a ban on Muslim immigrants and for gay men and women to “be disqualified from public office.” Others tied to the event have called for the government to be placed under Christian control and suggested Oprah Winfrey is setting the stage for the antichrist.

Some have suggested the event could link Perry to the religious fringes in a way that could hurt him both in states like New Hampshire and with the full electorate if he wins the GOP nomination, and have speculated that Perry may thus play down his involvement in the event he initiated. But Bearse, the spokesman for The Response, said that is not the case.

One preacher expected to participate has said Hitler was “God’s hunter” and another has allegedly called for armed defense of the white race. Perry himself was the event’s originator, but during the past week, he and his spokespeople have been attempting to suggest he is not the lead supporter and may not even speak at the event.

There has been widespread criticism of Mr. Perry, suggesting he is both out of touch and perilously aligned with extremist organizations. There has been criticism that Perry, now seen as a viable Republican presidential primary candidate could stain the party with the taint of racial hate, ideological extremism, and fundamentalist zealotry.

UPDATE, Sun., August 7, 2011: There is dispute as to whether attendance at Gov. Perry’s prayer rally was 30,000, as organizers claim, or 15,000, as other news sources have estimated. Observers have expressed concern that the event featured radicals whose views oppose the constitutional order of the American political system, and who have called for the establishment of an absolutist theocratic regime.

The following report from Suite101 is particularly telling:

Possible 2012 GOP candidate Rick Perry was a hit with the 15,000 gathered for August 6, 2011 prayer meeting held in Houston.

Rick Perry, who is eyeing a run for the Presidency in 2012, may eventually have to distance himself from his more extremist Christian supporters. The trouble is that Perry needs the support of the American Family Association, which sponsored Perry’s allegedly non-political prayer meeting called The Response. An even more troubling possibility is that Perry may be in full agreement with their Reconstructionist plan to take down the Federal government and create a U.S. theocracy, under Biblical law.

Christian Extremists

The idea that Christians should physically overcome their enemies and rule in righteousness is not new in the United States, and the current thread of theocratic Christian Reconstructionists goes back at least to 1948. The movement has operated under various names such as the Latter Rain movement, Joel’s Army, the Manifest Sons of God, and now the Seven Mountain Mandate.

Conquer and Occupy Public Institutions

According to Chip Berlet, writing in the Huffington Post, “Christian Reconstructionism is a form of theocratic dominion theology…The core theme of dominion theology is that the Bible mandates Christians to take over and “occupy” secular institutions.” Dominionists and followers of the Seven Mountain Mandate came to public attention in 2005 when a video of Kenyan Pastor, Thomas Muthee anointing Sara Palin for leadership, was uploaded on Youtube.

One group participating, in particular, has been cited as an extremist organization, founded on the missionary promotion of intolerance and prejudice. According to People for the American Way, the so-called American Family Association has:

• held gays responsible for the Holocaust and likened them to domestic terrorists and Nazis who are intent on committing “virtual genocide” against the military, and asserts that “homosexuals should be disqualified from public office”;
• said “we have feminized the Medal of Honor” by awarding it to a soldier who saved his fellow combatants rather than killing enemies;
• demanded all immigrants “convert to Christianity” and renounce their religions;
• asserted that Muslims have “no fundamental First Amendment claims” and should be banned from building mosques and deported from the US, adding that Muslims are inherently stupid as a result of inbreeding;
• claimed African American women “rut like rabbits” due to welfare and that Native Americans are “morally disqualified” from living in America because they didn’t convert to Christianity and were consequently cursed by God with alcoholism and poverty;
• said that the anti-Muslim manifesto of the right-wing Christian terrorist who killed dozens in Norway was “accurate.”

The Dallas Morning News has reported that Perry’s affiliation with extremist organizations, and his radical policies, which have undermined overall economic progress for the population of his state, are driving Democratic party views that he is a deeply flawed candidate, too far out of the mainstream to be electable nationally. From today’s DMN:

As Rick Perry gears up for a presidential bid, Democrats also are making preparations — dusting off years of opposition research, sharpening attack points, designing anti-Perry websites and, for the most part, awaiting his entry with more eagerness than anxiety.

They’re not trying to tip the GOP primary. But in seeking to tar Perry as a flawed extremist, they want to ensure that as voters beyond Texas get to know him, he won’t be able to shake that image later.

“He has a pretty poor record as governor of Texas on a lot of measures — on wage growth, on job growth, on health care,” said Bill Burton, head of a new pro-Obama political action committee, Priorities USA, and until recently the deputy White House press secretary.

He called it “fairly amazing” that a quarter of Texas are uninsured, and that Perry wanted to opt out of Medicaid and “suggested secession as a remedy to the health care bill.”

The secessionist narrative is particularly disturbing to many in both the Republican and Democratic parties. Perry is seen as a wild-card that would not be likely to take responsible positions on the direction of national policy, and who might bring fringe ideas into the heart of the American government.

At a time of severe economic difficulty, there is concern Perry’s often rosy-eyed commitment to market-distorting deregulatory policies could deepen and prolong the years-long economic slowdown. His state has one of the nation’s most massive budget deficits, and no substantive plan to address it, other than cutting back on needed public services, and economists are now starting to look at whether the extreme positions and under-thought policy approaches might pervade his economic policy strategy.

The news today seems to indicate that while Rick Perry may have shored up a radical segment of the evangelical vote, he has succeeded in casting himself as an ally to extremists with little regard to the perils of programmatic intolerance and discrimination.

Texas, the most energy-rich populous state in the country, with more oil, more wind, more sun, and a more developed energy sector, than any other state, is now undergoing rolling blackouts, in part because Gov. Rick Perry’s budget policy is bankrupting the state, ending incentives and cutting off supply. Under Perry, the state has run up a $28 billion deficit, and Chinese firms have been buying up major wind energy projects.

Perry’s ideological manipulation of state budget priorities has not only hampered the state’s development of cutting-edge clean energy sources, it has eroded the educational opportunity, targeted lower income families for reduced opportunity, and slowed job creation. The one thing propping up the state’s economic output is immigration, which has allowed new opportunity, new hiring and new capital flows, despite the governor’s attempts to shut them down.

When he named a top utility regulator to head the state’s railroad agency, he did so specifically proclaiming his appointee ”will continue to push back against the Obama Administration’s misguided energy policies which threaten Texas jobs and our nation’s energy security”.

Specifically, Perry meant he wanted to stop construction of high-speed railways—which would create tens of thousands of jobs—and slow, halt or even reverse the transition from costly fossil fuels to more efficient clean energy technologies. The reason? Fossil fuels produce a higher profit margin for the interests that back them, though clean energy technologies, high-speed rail and the smart grid would produce more generalized prosperity and a healthier economy for the state and the region.

Perry has consistently sought to stock the state’s regulatory authorities with industry-interested figures. He has complained that Texas, which emits a huge amount of carbon-dioxide and other pollutants, from fossil fuel-powered plants, should not be subject to the clean air rule that seeks to prevent contamination of one state’s air by activities in another state. He maintains that Texas is above federal law, and has been criticized for a ‘head-in-the-sand’ approach to energy.

Now, in the long, hot summer of 2011, Rick Perry’s Texas has run out of energy, and is experiencing rolling blackouts. The energy capital of the United States is out of energy, because the governor’s fiscal policies and manipulation of incentives has been reckless, ill-informed and biased, crimping the flow of investment and undermining the rate of innovation.

Though oil and gas are not producing the level of job creation of wind, solar, geothermal and renewables, Perry has sought to curtail investment in new technologies, privileging outdated fuel sources whose entrenched power is hampering the job creation potential of what has been Texas’ best opportunity for growth: wind and solar power.

While the nation has been moving toward, albeit at a painfully slow pace, a cleaner energy paradigm, for three decades, with technologies to achieve this accelerating in efficiency and productivity several fold in the last ten years alone, and while Texas is the nation’s wind-energy leader, he has sought to put fossil fuel interests first, to the detriment of the state’s immediate and long-term economic health and vibrancy.

Under Perry’s stewardship, the leading energy-rich state in the nation has been forced into its fifth “energy emergency” this year alone, and is now importing electricity from Mexico. According to a Texas Tribute report from earlier this week:

As scorching temperatures continued and Texas electricity use reached another all-time high, the state grid operator initiated the first step of emergency procedures today, seeking power from other grids, including Mexico.

About 20 power generation units, accounting for around 3,000 megawatts of capacity, were unavailable today during unplanned outages, adding to the strain on the grid. Today’s temperatures soared well past 100 degrees, and it’s not likely that the situation will get better Wednesday or Thursday unless some thunderstorms pass over a major metropolitan area, like Houston or Dallas, to lessen demand.

ERCOT—the Energy Reliability Council of Texas—has sought to implement these emergency procedures due to a combination of record electricity demand and inadequate supply. The unplanned outages were the most significant development, in that they suggest the grid itself has been underfunded and unprepared for the volume needed.

When Perry’s bad fiscal planning and ideological manipulation of taxes is combined with his loyalty to entrenched oil, gas and coal interests, it is clear the clean energy and smart grid industry is fending for itself, and doing very well, but not as well as Texas’ world leading electricity demand requires. His policies have, in fact, left his state with a massive and worsening budget deficit, with no serious plan for course correction, and with severe obstacles to improving the electricity generation crisis.

According to the New Republic:

The Lone Star State has a standing $10 billion shortfall every two-year budget cycle, thanks to a faulty tax system pushed by Perry that fails to balance the budget. Although the governor normally stays away from the state Legislature—sightings in either chamber are rare and exciting—Perry engineered a new business tax in 2006 to replace a prior one riddled with loopholes. Ostensibly a good idea, his new tax nonetheless suffered from the simple fact that it didn’t bring in enough revenue. Furthermore, it turned out to be incredibly complex, leaving many business owners scratching their heads. Those who figured it out, meanwhile, realized that, because the new tax was levied on gross margins as opposed to profits, companies could be losing money and still find themselves on the hook.

State legislators on both sides of the aisle have decried Perry’s ill-conceived fiscal planning. The chief Senate budget writer, Republican Steve Ogden, hasn’t been afraid to mince words about just how bad the business tax is. “None of us were elected to raise taxes on anybody,” he said the first day of the session. “But the margins tax is different. If we don’t fix the margins tax, local property taxes will definitely go up.” The regular legislative session came and went, however, without any real effort to fix the broken tax. The result is that the state is still operating with a structural deficit, and will very likely face more cuts the next time around.

Perry’s loyalty to old energy interests means the state’s cuts are hurting the more job-creation-intensive new energy sector. There has not been the funding available to develop the smart grid, or the major transmission lines, needed to maximize output from wind farms. So even as the Texas wind industry has seen a nation-leading boom in the last decade, its ability to adequately serve the marketplace has been slowed by outdated priorities and what some call overt political bias.

Due to its Renewable Portfolio Standard, which Perry supported, Texas has outpaced other states in wind energy sector development, but critics say too much of the profit is going to foreign companies, not enough Recovery Act funding was deployed to spur investment and too few incentives are in place for in-state start-ups to compete with big oil, coal and gas, and with the Chinese firms Perry is now relying on to fund wind development.

When the Texas wind industry was gearing up for what was likely to be one of the biggest investment booms the state, or the nation, for that matter, had seen in a long time, as a result of Congressional action to reduce carbon emissions and incentivize a transition to clean energy, Perry vehemently opposed the action. When the carbon pricing legislation failed, in the summer of 2010, the result was a swift reversal on the part of major investors, like oil tycoon Boone Pickens, who had been ready to devote record sums to the wind energy sector.

One year later, Texas is undergoing rolling blackouts, its fifth energy emergency in just 8 months, and is having to import electricity from Mexico, because the fiscal and regulatory management of Gov. Rick Perry is not designed to, and is not capable of providing for a more robust smart energy economy. The state has more demand than conventional energy sources can provide, and Gov. Perry has sought to prop up those power sources, to the detriment of innovation and job creation.

The most wind-rich state in the Union could be supplying more than half its electricity from advanced wind power systems, were the infrastructure in place to do so, and Perry’s budgetary mismanagement has diverted both public and private investment to wasteful spending on outmoded power sources, which are costing the state still more in terms of regulatory and public health adaptation, and in opportunity costs from jobs foregone, competition not stimulated, and infrastructure not built.

A wind-and-solar supplied smart grid would allow Texas’ hobbled fossil fuel economy to meet demand, and could, within just two years, reach the 20% clean energy threshold, using existing public-private investment incentives, were they directed where they need to be. The long-term plan should be for 50% wind and solar by 2020, something an adequately funded Texas clean energy sector could easily accomplish, with its abundance of wind, solar and land area.

There are also concerns that, as the focus has moved away from aggressive development of wind energy, Texas may now be experiencing a kind of energy market manipulation like what took place in California, right before the collapse of Enron, when power utilities and power-supply traders colluded to deprive the market of supply in order to force blackouts, during hot—deadly—summer months, and extract huge long-term price hikes from the state. Public policy in Texas has been steered toward subsidizing low consumer electricity prices, but now, the same suppliers that benefit from the resulting massive demand are crying poverty, producing too little and demanding higher prices.

They have hit the state electricity price cap of $3,000 per megawatt-hour, but despite that cap, and what should be the potential to rapidly ramp up clean energy output, the deregulated Texas energy sector leaves the state vulnerable to this kind of underfunded energy production, supply shortages and potential market pricing disruptions. It will be up to Rick Perry to figure out if the status quo is the best thing for Texas; we can only hope he sees that what Texas needs is a majority-renewable smart energy sector, sooner rather than later.

In a stunning move, the American Conservative Union (ACU), which runs the Conservative Political Action Conference (CPAC), has barred one of its former sponsors, a conservative gay rights group called GOProud. The ban comes just as moderate Republicans are calling on the party to embrace same-sex marriage and gay rights, put the culture wars behind them, and focus on conservative principles more in line with Constitutional freedoms and market economics, as their platform.

The decision was announced in a letter from Gregg Keller, national executive director for the ACU, which read, in part:

The American Conservative Union is preparing to open registration and announce sponsorship opportunities for our Conservative Political Action Conference (CPAC) 2012. As a courtesy to your organization, a previous co-sponsor of CPAC, this letter serves to inform you GOProud will not be invited to participate in a formal role for CPAC events scheduled during the 2012 election cycle.

The decision is certain to draw a new rift in the conservative movement, as libertarian conservatives continue to pressure the Republican party to graduate into the present day, honor the personal liberties enshrined in the Constitution, and put an end to the culture wars. It may also split the Republican primary field, as many now believe it will not be possible to continue anti-gay politics as a platform issue, without forfeiting national elections.

The Democratic party may see an opportunity here, to intensify its pressure on the GOP, which is increasingly being seen by voters—according to recent polling—as a party unwilling to cooperate in constructive governing, riven by ideological radicalism, and determined to attack seniors, the underprivileged, immigrants and other minorities.

Former New York City mayor Rudolph Giuliani said, after his state legalized same-sex marriage, with Republican support, said it was time for the Republican party to support same-sex marriage and ev0lve. Pres. Obama, who has said his own views on the subject are “evolving”, has consistently supported gay rights and the move towards full equality in civil marriage. In July, the Pentagon ended its “don’t ask, don’t tell” policy, ending centuries of discrimination against homosexual soldiers.

Fred Karger, the only openly gay Republican candidate for president, has reported being barred from conferences and debates, and has written a scathing indictment of the ACU, for the Guardian newspaper. In his piece, Karger writes:

Alberto “Al” Cardenas, the new head of the American Conservative Union (ACU), has taken bigotry and hypocrisy to new heights. I believe I was a victim of his organisation’s prejudice earlier this year when I wanted to purchase a booth at their annual CPAC gathering in Washington, DC. My credit card information was taken last December, and I was told that I was in. Then, mysteriously, three weeks later, I was told by phone that they had “sold out”. Funny, others were purchasing booths right up until the conference began in mid February.

As the first openly gay candidate to run for president of either party, I have hit some bumps in the road, but I have to say that my treatment by the American Conservative Union was the most hurtful and hateful to date.

Now they have taken it up a notch: they have just announced that the gay conservative Republican group GOProud is not allowed a booth at next winter’s CPAC conference (pdf). Cardenas is not saying to GOProud that CPAC has “sold out”; he is saying, simply, STAY OUT!

CPAC is holding an event in Florida, on September 23, and Karger says he was not invited to attend. He will be asking all of the other Republican presidential candidates to boycott the event, so long as the ACU maintains its ban on his participation or on GOProud participating in next year’s conference.

The composition of the national debt is a complex history of policy decisions, governmental priorities and Congressional authorizations. Republican opponents of Pres. Obama have suggested that debt and deficits have “exploded” since he took office. They have sought to paint the president as a “tax and spend liberal”, because that accusation fits their standard campaign model.

But economists and budget analysts, including a top budget aide to Republican presidents Reagan and Bush, the elder, say Obama’s actual performance as president puts his budget policy in the “moderate conservative” segment of the fiscal policy spectrum. He has routinely demanded from Congress that major legislation be “paid for” or “deficit neutral”, and he has struggled mightily—putting aside his own policy priorities—to slow the expansion of deficits that stems from policies enacted by the previous administration.

Among these major policy drivers are the wars in Iraq and Afghanistan. The Bush administration simply never included either war in official budget projections, requiring Congress to fund both through “supplemental” spending agreements. The result was that two massive unfunded wars, each adding trillions to government spending, over a decade, were kept “off the books”.

Barack Obama—who voted to oppose raising the debt ceiling when he was a senator, in part because he believed the “off the books” accounting was going to bankrupt the government and pose a threat to the nation’s long term health and prosperity—viewed this as unethical and pledged to put the wars on the books, so the public, and the Congress, could more directly judge the costs and benefits of the wars and plan for the long term.

What is vitally important for all independent voters to understand is that while the debt debate has been laced-through with intense partisan rhetoric and vitriolic attacks, is that there are real drivers of the national debt, and they have little to do with socialism. The national debt is a product of patterns of borrowing that have soared over the last three decades, largely from one particular problem: the coincidence of relentless tax cutting with the need to fund existing programs and address real-world challenges.

In 1981, when Pres. Jimmy Carter left office, the national debt was under $1 trillion. By the time Pres. Ronald Reagan left office, in 1989, the national debt was close to $3 trillion. During Pres. George H.W. Bush’s first year in office, when the budget was Reagan’s last budget, the national debt broke $3 trillion.

The first Pres. Bush was a better debt manager than his immediate predecessor or his son; debt grew by roughly $1.4 trillion, during his 4 years in office. Pres. Clinton did a little better, adding about the same amount over 8 years. But Clinton achieved an important result: he left the government with projected budget surpluses exceeding the total national debt, over the coming decade.

Pres. George W. Bush took office in 2001 with those surpluses in place. His 2001 tax cut, however, reversed the entire surplus, and by the time of his reelection in 2004, he added to the (once again) growing debt another $1.7 trillion. By the time he left office in 2009, the national debt had escalated to over $10 trillion, and the debt ceiling was already primed for another $2 trillion in borrowing.

That extra $2 trillion in borrowing was necessary, to pay for spending already “in the pipeline”, already passed into law and on the federal books, either as part of the official budget or supplemental spending. By the end of 2009, with George W. Bush’s last annual budget playing out, the national debt was at $12 trillion. It would be mid 2010, before the active federal budget was “owned” by Obama.

As of this writing, the policies of George W. Bush have added fully $7 trillion to the national debt. Since then, Pres. Obama’s policies have added another $1.4 trillion, and already planned spending policy, historically low government tax revenues and the economic reality of tight credit, slow growth and lagging job creation, makes it very difficult for him for him to cut spending to a level where he would be able to match Pres. Bush, the elder and Pres. Clinton, in managing the national debt.

His record on budgets has been one of reformer: he has consistently favored institutional reforms that impose real cuts, and bend cost growth down to match or fall below inflation. But reducing spending can reduce national economic growth as well, further straining the national debt trend lines.

What Pres. George H.W. Bush and Pres. Clinton were able to manage was a cooperative Congressional environment, in which tough bargains were made with rivals in Congress. Pres. Obama has not had that luxury, and it may be he will not have it. There are growing tensions in the Republican party, resulting from real disagreement about whether budget and debt should be used for partisan strategy or whether they should be non-partisan policy items, with all voting in favor of the national interest.

Independent voters are looking for sanity. We are looking for reason and clarity. We are looking for long-term policy decisions that help steer the nation toward prosperity and sustainable, generalized economic wellbeing. We need a balanced standard for budget policy, where revenues increase to meet costs, so the United States remains the world’s leading fiscal policy driver and the dollar remains the world’s reserve currency.

There is opportunity in the budget policy negotiations, but the opportunity will be missed, if one or both sides refuse to use the negotiations to reach a constructive, well-designed, well-funded, rational policy on national community reinvestment, infrastructure upgrades, education and new revenues capable of meeting our needs and our aims.

Speaker of the House John Boehner appears to have made an astonishing miscalculation in his legislative strategy, designing proposed legislation to be viable only in a 100% party-line vote, even though as many as 120 of his own members have vowed not to support raising the debt ceiling.

Speaker Boehner would need to round up only 21 Republican votes to pass a Democratic or bipartisan plan emerging from the Senate, were he able to rely on all of the Democratic members of the House. It would seem a more reasonable political calculation to work with the party that wants to make a deal than to struggle against all odds to win support from those who have vowed not to give it.

Democratic whip Steny Hoyer put it succinctly, quipping tonight that “The party of no is saying no to their own policy.” He added that the Republican policy of making radical demands in order to avoid default “is an immoral policy”. Hoyer said tonight “I’ve been in Congress 30 years, and I don’t know that I’ve been as concerned about the welfare of my country as I am tonight.”

Independent Vermont senator Bernie Sanders said tonight that “what is going on in the House right now is a disgrace and an outrage”. He asked how it could be that “the Congress is so far removed from what the American people want”, citing surveys that show people don’t want the deep cuts to entitlement programs now under consideration and that they do want taxes to rise for those earning more than $250,000 a year.

Speaker Boehner has not only failed to bring a viable piece of legislation to a vote, putting the nation’s fiscal integrity at risk, but he has managed the debt negotiations in a manner that has left the American public with the distinct impression that his party is not serious about solving the debt crisis.

And yet, there is a subtler way in which Boehner’s miscalculation could also harm his party. As the pressure mounts to make a deal, it becomes clearer that everyone is waiting for Tea Party radicals in the Republican party to decide whether or not the nation should be plunged into economic calamity, in service of ideological policy preferences.

That will obviously reflect badly on the Tea Party members involved in the standoff, but it will also make it harder for Republicans more broadly to win in 2012. Boehner could have avoided this crisis for the nation, and for his party, by working across the aisle, by letting the radicals know, with the same firm language he has used this week to demand cooperation, that he will not be held hostage and they can choose to make themselves relevant or not.

Boehner could have shown himself to be a statesman by cobbling together a “coalition of the willing”, comprised of moderates in both parties. Such a move would have elevated him as leader of the entire House of Representatives, worthy of the third highest office in the Constitutional order.

Instead, Mr. Boehner’s astonishing miscalculation now appears to have the nation hurdling toward debt default, credit downgrade, forced recession, and massive job loss, and his party torn and divided, his speakership in question, and Republican electoral chances sliding, by the day.

There is no constructive outcome to be gained from this debacle, and no clear way to explain why Mr. Boehner and his caucus would push the issue so far as to lose on so many fronts at the same time.

White House spokesman Jay Carney, and Democrats in the House, increasingly aware that Mr. Boehner will likely need Democratic votes to raise the debt ceiling, are reminding Mr. Boehner that the “grand bargain”, which would include new revenues, is still available. It is believed some version of that deal, with between $800 billion and $2 trillion in new revenues, could pass both houses, if Boehner can wrangle enough Republicans to vote with Nancy Pelosi’s Democratic minority.

At 10:27 pm, Rep. McCarthy, the House Republican whip, announced there would be no vote on the “Boehner bill” this evening. That marks four consecutive days that Mr. Boehner has been unable to get a vote on a piece of legislation that no one believes can pass the Senate.

IndependentsOfPrinciple :: House Speaker John Boehner appears to be under attack from an intransigent House Republican caucus that will not allow him to retain any credible leadership if he agrees to a debt and deficit reduction plan that includes any tax increases of any kind. While select Republicans in the Senate agree with the deficit commission recommendations and the Gang of Six proposal—which recognizes the need to increase revenues to deal with escalating deficits—, radicals refuse to agree to any compromise.

It seems Speaker Boehner is being held hostage by a radical Tea Party revolt in his party, whom he is not prepared to anger. Part of the problem is rhetorical. On issues of debt, deficit, entitlements and security, routine use of hyperbole has so distorted debate, that much political discourse now distorts what is actually happening in policy. Republican Sen. Tom Coburn (OK) told Meet the Press, falsely, that “the government is twice as big as it was ten years ago; it’s thirty percent bigger than it was when Pres. Obama took office.”

What Coburn is speaking about is the federal budget, and nearly the entire amount of the increases he cites are security related—specifically the costs of funding the wars in Iraq and Afghanistan, along with increases in Pentagon spending. Pres. Obama added massive new numbers to the federal budget, without adding any new spending, simply by reporting, for the first time, the spending for Iraq and Afghanistan as part of the budget.

Such distorted rhetoric, treating cost as “the size of government”, leads many conservatives to the mistaken view that tax dollars are being foolishly wasted on unnecessary programs, new hires, and intrusions into personal freedom. In fact, there are fewer government employees now than when Pres. Obama took office; in fact, Democrats are proposing sweeping reforms designed to reduce long-term debt and deficits; in fact, it is failure to fund the government that is causing the deficit to expand.

Sen. Coburn also repeated on Meet the Press the right-wing myth that Pres. Obama has been “unwilling to deal with entitlements”. When Pres. Obama’s healthcare reform process called for saving $500 billion in Medicare fraud, waste and abuse,  over 10 years, Republicans ran vicious and false ads against him, claiming he was trying to “gut Medicare” and “cut benefits” for the elderly. In fact, it has been Pres. Obama who has repeatedly proposed targeted Medicare reform, designed to roll back costs without cutting benefits.

“Entitlements” is another keyword in the rhetorical distortion of Washington politics: entitlements are programs which some citizens are “entitled to” because they have funded them. By paying into Social Security and Medicare, or by virtue of one’s military service, one accumulates benefits that come later in life. There are many benefits to society of such a system, and the “entitlement” factor in the equation is really, and should be thought of as earned benefits.

Medicaid, unemployment benefits, food stamps, and SCHIP—which provides health insurance to underprivileged children—operate on a different logic. But, there is no way to eliminate spending on these without causing real and measurable harm to the overall economy. Even these “entitlement” programs are really designed to optimize the public cost of certain failures of the marketplace to optimize costs. Our public discourse on “entitlements” is almost entirely driven by a narrow ideological view that anyone receiving entitlements is a parasite.

In this climate, Speaker Boehner is trapped between the reason of the vast majority of people, who believe we cannot solve the mounting deficit crisis without addressing revenue shortfalls and the unreason of a radical Tea Party faction, a minority even of his own party, that will not support any increase in taxes, no matter the potentially virtuous impact on the nation’s economic fabric.

Last week, Boehner tried to move his position closer to a “grand bargain”, with Pres. Obama, who has sought to meet the demand of that reasoned majority; since Friday, he appears trapped behind a wall of intransigence, not of his own construction. Much of this may stem from the hardcore ideologically wishful mythologies that prevail in the use of rhetoric to deal with debt and deficit issues.

Doris Kearns Goodwin said, today, that people in the political center are often neglected by the heated political rhetoric that prevails in ideological debate. She noted that some have called for “raging centrists” who can represent the true voice of independents. Boehner has sought to be the skilled negotiator and the leader wise enough to recognize a good deal when he sees one, but it now appears his party will not allow him to lead in that way.

There are questions about whether the Boehner speakership is in jeopardy, whether his party will challenge his leadership, if he strays from their 2012 election strategy, which involves a programmatic refusal to cooperate with Pres. Obama. More radical Tea Partyists have adopted the irresponsible “blow it up” view, which holds that forcing default will ruin the government and allow them to rebuild it, according to their ideological preferences.

For the record, Tim Pawlenty proudly says he “did blow it up” when he was governor of Minnesota, leading to a debilitating government shutdown, the furlough of thousands of workers, negative impact to his state’s economy, and higher borrowing costs that could weigh on the state’s budget for years. Economists agree that default would be catastrophic, and would lead to higher borrowing costs, exacerbating the problem and doing serious long-term harm to the wider economy.

Andrea Mitchell said it is hard for her to understand how over 200 members of the House of Representatives swear an oath to refuse to raise taxes, before even evaluating the wisdom of specific policies on which negotiation will be necessary. Historically, being a good legislator means being able to make the deal that moves official policy in the direction of your agenda. Many, including Republicans, are now urging Speaker Boehner to abandon the Tea Party radicals and work with moderate Republicans and Democrats to stave off catastrophic default.

Meet the Press moderator David Gregory quoted Winston Churchill, who said “You can always count on Americans to do the right thing, after they’ve tried everything else.” Many political analysts believe we could do better, if there were more consideration given to non-ideological positions, which may actually represent the views of most Americans, regardless of their partisan voting habits.

Independent voters are often credited with leading the debate from the political center, but have been boxed out of all talk on debt and deficit, with ideological distortions applied to polling numbers to obscure their views. The debt-ceiling negotiations have thrown into high contrast the implied obligation that House Speaker Boeher join Pres. Obama and Senate Leader Reid as three principled centrists negotiating, as Boehner today told Chris Wallace, to do “what’s right for the country,” regardless of party preferences.

ABC News political correspondent Jonathan Karl today tweeted: “Boehner will face a revolt of his own leadership for grand bargain that increases revenue by 800B. Am told Cantor&McCarthy are opposed.” Mr. Boehner finds himself pressed by history to be a principled centrist, but standing alone between reason and unreason, and under attack from his own party. He may even be facing the threat of a challenge from Eric Cantor (R-VA), who has used the debt debate to reposition himself as an ally of the Tea Party.

Speaker Boehner did, however, say today that he did not come to Washington to “be a Congressman”, but to “do what is right for the country.” And he may now have to choose between the two. The question is, ultimately, whether the American people can find a way to expand the space for the voice of reason, and reward principled moderates who make political sacrifices in service to “what is good for the country”.

IndependentsOfPrinciple.com :: The Bipartisan Policy Center has found that if there is no agreement to raise the debt limit by August 2, the Treasury Department would fail to pay 44 percent of its obligations. That 44 percent of government spending, over a year, is equivalent to a real decline in GDP of 10 percent.

The number is that high because the Treasury Department has been making fiscal adjustments since March, in order to stave off default. Those adjustment have been pushed as far as possible and cannot continue to push back the deadline, beyond August 2.

Some analysts suggest the Treasury Department’s efforts since March mean the United States government is already, in some sense, in default, and that only with a rapid increase in new borrowing and new tax revenues, can the nation actually avoid that default coming fully to the fore.

The complexity of the budget crisis becomes somewhat simpler, when one looks at the direct impact of default on GDP. Even before we look at the indirect, ripple-effect impact on GDP, we know that a 44% decline in spending will constitute a 10% decline in GDP. That immediate impact on economic growth will plunge the nation into recession.

That new recession will be made far more severe by the financial industry ripple effect, as borrowing costs rapidly escalate, and homeowners, consumers and businesses, even major banks and investment banks, find it more expensive to borrow money to fund their lives and/or operations.

Job creation is sluggish already because banks are still not lending as readily as they did before the financial industry collapse of 2007-2008. And critics warn the banking industry has still not covered the gap between the wealth it claimed to hold—and so the obligations it took on—and the wealth actually available to the marketplace.

That imbalance slows the flow of capital to borrowers, meaning that only record-low interest rates make it possible for banks to keep lending. If interest rates begin to rapidly escalate, due to a combination of government default, a downgraded credit rating, and reduced demand for government bonds, the flow of capital to borrowers will be staunched.

With a dramatic drop in GDP, a dramatic reduction in lending, a dramatic increase in government borrowing costs, and the consequent decline in value-for-dollar spending ROI, the United States would find itself in a far deeper economic “ditch” than the Great Recession, with no clear path for getting out of the ditch.

Tax rates are as low as they have been since Harry Truman was president. Ronald Reagan raised the debt ceiling 17 times in 8 years, and raised taxes in order to offset the deficits created by his historic tax cuts. The cause of long-term debt and deficit reduction requires that the massive costs of default not come due.

For the first time in living memory, a Democratic president is offering major concessions on Medicare, Medicaid and Social Security, in exchange for relatively modest upward adjustments in the tax burden on the wealthiest Americans. A number of Senate Republicans agree this is the more responsible way to actually reduce the debt and annual budget deficits.

There is bipartisan support for the Gang of Six plan, which requires $2 trillion in new revenues. Some now argue that Tea Party Republicans in the House of Representatives should be ignored by Speaker John Boehner, because they continue to vow to oppose any increase in the debt ceiling, no matter the agreement reached.

Two analysts on CNN’s Your Money report today said the debt ceiling negotiations are in fact a “constitutional crisis”—a view supported by the 14th Amendment’s requirement that no public debt be called into question. It is now clear that without some serious plan to actually reduce deficits and the need for borrowing, any debt ceiling—or “cap”—will have to continue to rise, even if Congress and the White House begin to grapple over who has the authority to raise it.

What is certain is that no politician can gain anything by forcing the federal government to fail to make payments on 44% of its entire spectrum of obligations. Just one month of a 10% decline in economic output could thrust the nation almost immediately into a severe recession, causing the costs of default to fall to the shoulders of ordinary Americans, leading to a downward spiral.

This is not alarmism. It is simple arithmetic.

It is time for Congress to find common ground with the president, for both sides to make concessions, and for a serious, constructive, viable, long-term plan to emerge, in connection with a debt-ceiling increase substantial enough to last through the 2012 elections.

The nation cannot afford to face this same crisis three or six or nine months from now, with every member of the House up for re-election, along with one third of the senate and a billion-dollar-plus campaign for the White House.

TheHotSpring.net :: It is a virtual mantra in the universe of political analysis that “business doesn’t like uncertainty”, and it is true that declining consumer spending, increasing fuel costs, squeeze profits and that in some cases, businesses worry about changes to the regulations they must follow. But uncertainty is the nature of an evolving global economy, and with the accelerating pace of innovation, doing any business well is going to require dealing intelligently with uncertainty.

“Uncertainty” is also, in many cases, a code-word for an aversion to paying taxes. And there are implications there, in that contest of ideas, that are more real and far-reaching than the metaphorical back-and-forth of the rhetoric involved. An out-of-balance system of taxation puts pressure on ordinary people, and breeds uncertainty. Yet some of the world’s largest enterprises continue to push for ever-expanding tax reductions, calling those guaranteed revenues “certainty”.

This is not a healthy marketplace. This is not a democratic marketplace. This is not conducive to fostering the kind of innovation and creative thinking that allows an enterprise to deal with uncertainty. Access to information is the most important tool for anyone who has a significant challenge involving questions of certainty or uncertainty. Yet markets are slowed and restrained by blockages in the flow of relevant information.

During the 1998-2008 period, in which subprime mortgages, and eventually the toxic and inviable derivative investment funds built on bundled subprime mortgages, clear information about what kind of real financial products (the particular mortgages) were being used to underpin and fill out the derivatives, which ultimately had much higher professed market value, was often not available to investors. Meaningful facts were obscured, which created irrational investments, and widespread toxicity in financial markets.

This had a direct impact on the way government money, including bonds and borrowing, was used in relation to private investment, and ultimately cost taxpayers trillions of dollars in emergency investment, much of it still being paid back. Efforts to make it easier to extract profits where they are not always justifiable, given real value to the market, can give certainty to some, but breed massive uncertainty elsewhere.

So, transparency must be a key value in a healthy 21st century economy. Constructive transparency, that allows entrepreneurs and investors to recognize, plan for and deal intelligently with uncertainty that might penetrate into their domain.

In order to build a healthy, cutting-edge, competitive, intelligent economy for the 21st century, we need to privilege the kind of thinking that will achieve those ends. Aversion to innovation, change, competition and evolutionary planning, will not achieve that. In order to achieve a balance of resources that lends itself to dealing ably with uncertainty, businesses need to have the flexibility and creativity to adjust, to renew their market position, to fund intangible values that shore up the human intelligence that drives their enterprise.

A few examples:

From Coal to Clean: Coal companies, for instance, may find “uncertainty” in the 21st century energy economy, as their main resource falls out of favor and the efficiency of clean resources catches up and rushes past their business model. They can start planning to use the efficiencies currently inherent in their business model to plan the transition they will need to fund in order to diversify their portfolio and be relevant in the post-coal era.

Print and Pixels: The press have done extremely well, for over two centuries, in North America, driving the democratization of society throughout, and informing people about their world. But print publications are struggling to harmonize their operations with online technology. That harmony may come from bold new experiments in crafting virtuous feedback loops between print and pixels, so that the use-value of each to readers expands the publication’s readership, building in a community to the publication’s business model.

Transparency ROI: The release of information that might normally be considered proprietary, or which commercial enterprises might prefer not to reveal, can pay significant dividends. Doing business with a forthright and trustworthy partner is worth a lot more to most people than an off-chance at getting a bargain. Building trust in the age of globalized online spin and the mischief some associate with impersonal, remotely managed services, can be the basis for a booming business, offering consumers shelter from uncertainty.

Adversity is Opportunity: There are times when sudden cost shifts threaten to impact the bottom line. If there has been insufficient planning, or revenues are too scarce, that can be an existential threat to a business. But an existential challenge can also be an opportunity to rapidly turn a slow, weighty ship of method, using the turbulence of the surrounding seas to nudge the bow in the right direction.

In the 1990s, Starbucks responded to a South American frost and tripling of wholesale coffee prices by agreeing to contract with producers for double the prior market price, knowing the market price would fall below their contract. They built into their contract requirements for quality and for quality checks that allowed them to get far more value out of their higher payments than the increase itself. They came out ahead and were better equipped to build a reputation for consistently high quality coffee.

Uncertainty is important, because it is not always what it seems. The instability it seems to suggest can also be an opportunity for growth, evolution, innovation. And a shifting landscape of influence and competition can allow for concurrent evolutions and innovations that support and sustain one’s own new models and methods.

Learning to thrive in this more interconnected, more challenging environment is integral to planning a viable business in the 21st century, whether large or small. Diversity of resources and of opportunity must be one of the assets built into any successful enterprise, along with the intellectual and strategic agility necessary for keeping afloat in periodically rough seas. Technology facilitates such adaptation, but the ability to invent new responses to problems one could not foresee must also be part of one’s tool kit.

TheHotSpring.net :: Borders Books and Music was a place of pilgrimage for book lovers, music lovers and people who loved to sit with coffee and read, chat or peruse magazines they might or might not buy. It has played a vital role in the distribution of books of both wide and narrow market interest, and has driven the cathedral-warehouse paradigm of big bookstore chains. Its failure, however, opens the field for more innovative, more reader-friendly experiments in book selling.

Some have argued that Barnes and Noble was changed by its competition with Borders. Barnes and Noble has long been a leader in the big bookstore sector. But Borders, in many places, went bigger. It stocked everything that might fit into the mainstream book, magazine and music market, and was aggressive in putting full-size cafes in its bookstores, where patrons could sit and read books, whether they bought them or not.

But Barnes and Noble made two crucial decisions whose value Borders seemed not to understand. First, it built its own site for online sales, and built the BN.com brand to sustain it. Second, it saw the power of the Kindle reader and made sure not to cede mass-market e-book distribution to its online rival. By making its Nook and Nook Color readers available in its stores, Barnes and Noble successfully merged electronic and print media in a way that appealed to bricks-and-mortar bookstore browsers.

Borders could have done the same, but instead of building its own website early on, it made a deal with Amazon, and avoided—or so it seems to outside observers—learning too much about how to sustain its overall business through online sales and marketing. When it made the switch, serious book readers had already figured out it was better to just use BN or Amazon.

They forfeited their leadership position and radically increased the costs of getting to parity, when they finally decided to make a run for it.

Borders also lagged in the e-book revolution. Though in 2001, small publishers—like the publisher of this publication, Casavaria—were experimenting with independent e-books and early global distribution formats, Borders treated e-books as a question of stocking electronics that might be of interest to readers. They did not—again, as it would seem to outside observers—understand that e-books were about the direct text-to-eyeball relationship publishers, and booksellers, could develop with readers.

They did not understand—though in fairness, few major industry players did—what Amazon figured out early on: an optimal e-book platform required a screen that would feel more like print on paper than a screen. Though Joseph Epstein, and many other publishing luminaries, had said the book was a technology that was almost impossible to improve upon, Amazon and e-Ink figured out that the convenience of digital technology with the feel of a book, would be the next step.

Borders did not see this crucial moment coming. Its Kobo e-book reader is not actually a Borders product. Kobo is its own enterprise, and Borders’ plan was to piggyback on Kobo’s innovation. Like its Amazon deal, Borders’ Kobo deal clearly showed that Borders did not understand that the Kindle and the Nook are not books; they are bookstores and libraries, personalized for the convenience of the reader.

Kobo is now having to defend its reputation and advertise its independence and its survival. This may be good for Kobo, because it will no longer be linked with the big bookstore chain, and that may give it some cachet among bibliophiles. But it will have to compete for quality, and Borders may not have done Kobo a great service by channeling its development through a failing chain bookstore.

Kobo, to its credit, figured out that e-Ink was the right way to make electronic text enjoyable.

While a very cogent, and legitimate, analysis suggests print publishers may now commit to lower print runs for many, if not most, of their titles, the collapse of Borders may be, for writers, readers and publishers, something more of an opportunity than a calamity. A massive economy of scale is not always best for quality innovation. In Borders’ case, it appears to have been an obstacle. The size of the giant enterprise blinded its directors to the most meaningful developments swirling around them.

Small bookstores survive not because of the scalability of a global business plan. They survive when their bottom line, and their ability to fund their operations, reflect three things: discipline, sensitivity and good fortune. This last comes from clients, location and other hard-to-manage variables that cannot easily be planned for.

What is most important about small bookstores is that they cannot survive by just hawking gold-print embossed bestsellers and books that have been made into movies. They cannot even survive just by stocking the headier titles on the New York Times bestseller list or which have been reviewed in the major publications. They have to know their readers, and treat their clients as readers, not as cash machines.

It is this knowledge element that may now gain more traction. Knowledge… sensitivity to the lay of the land, and to reader interest… and innovation.

What might some innovations be?

The true cafe/bookstore: A more balanced relationship between the bookstore and cafe sections of a retail space, with high quality coffee, with events and music, gatherings and opportunities to sit down with authors, and a bookstore that echoes this quality with content.

The information oasis: Bookstores can reposition themselves as trusted sources of information, a more robust 21st century newsstand, stocking quality publications, some new to newcomers, and unique titles with real depth and scope, understood by intelligent, engaged buyers and salespeople. Mainstream media may be an echo-chamber, but bookstores can be places where the individual is free to think for herself.

The genius bar: One of the reasons Apple’s stores are popular with Mac lovers is that they provide information and knowledge that is useful; customers can learn from staff. Bookstores could make sure to be a source of guidance to the reading public, taking back that role from distributors and advertisers and being more pro-active about deciding what they stock.

The cyber-paper crossover: Barnes and Noble, BN.com and the Nook, have made for an impressive collaboration. Small bookstores can take Borders’ market share, collectively, if they learn the lesson Borders missed: assist your readers in all media, and they will stand by you. Wifi is useful, but dedicated new-fangle web access, whatever that looks like, could help bricks-and-mortar independents sell print books.

These are just a few ideas, but there is no mistaking the fact that as we enter the age of hyper-convergence, oversized enterprises won’t make it if they don’t innovate, and independent bookstores can do what microbreweries and coffee houses have done: become creative micro-distributors invested in the knowledge and emotion that naturally flow from, and to, the products they love.

IndependentsOfPrinciple :: The road to economic recovery must run through major new infrastructure upgrades, innovation and development. The American infrastructure was once the envy of the world, a valiant testament to the ingenuity and collaborative muscle of a free people; now, it is crumbling [pdf] from malignant neglect, and the cynicism of our political system’s dealings with money.

Infrastructure spending was once part of the central mission of building a great nation, open to trade and competition, where free people would migrate, ship, travel and explore, according to their own free will, imagination, and opportunity. Now, that embarrassment of riches is little more than embarrassment, and the resulting confusion over how we let such a vibrant landscape slide so far.

The Political Money Problem

When money in politics makes even the smallest public works project a trophy for a candidate, and individual senators can hold the entire nation hostage, demanding kickbacks for one state, the nation suffers. The people suffer, the quality of enterprise suffers, opportunities are lost and the infrastructure we depend on falters. We become less than we were.

But money in politics is not the only problem. It is also critically important to look at how money in politics has altered the political discourse regarding projects that benefit the people of the United States directly—that vibrant middle class we used to be so proud to encourage, to serve and to see expanding. Now, the big money interests deliberately back politicians not interested in projects for the public good, but rather in transferring wealth from middle class families and small businesses directly into the credit lines and financing schemes that fund multinational megacorporations and the wealthiest of 100% private holdings.

This is an open secret. We know it is the status quo, but we (the people of the United States, even the politicians, it would seem) feel helpless to reverse the trend. There is too much power in the hands of interests that are too cynical and too ready to undo any good that is done, at the stroke of a pen, signing a check that will steer critically important policy by choosing who wins elections.

That’s the popular mood, and the facile commentary. But there is something more to be taken note of: this is a democracy, and the people of the United States can change their government. We can change the way its elected leaders arrive at their posts, and we can divert funding away from low-value spending (like corporate tax breaks), toward high-value spending (like trains, bridges, levees, and public education).

In the midst of this brutal rhetorical battle over the nation’s priorities, which is masquerading as a debate about the so-called “debt ceiling”, the American people can demand reason, pragmatism, democracy and principled public service. We can make it clear to newspapers and to television networks that posturing, voodoo economic visions and sabotage will not win the day.

Priorities: Values & the Budget

There is no reason the United States of America must live with outdated and underperforming infrastructure, much less with infrastructure that is vulnerable to decay and collapse. There is no reason the people of the United States must see their future limited and constrained by the massive opportunity costs associated with misallocating resources by way of unfunded tax giveaways and unfunded wars.

Budget policy is not about politics; it is about priorities. It is imperative that if we want the most flexibility to build optimum benefits into our economic and political future, we don’t undertake campaigns of wealth-transfer or warfare, for which there is no exit strategy and no projected funding pool.

It is not true that a blanket policy requiring annual balancing of the federal budget will give us the sound underpinning required for a vibrant economic future. What is required is spending that intelligently takes in the long-term value added of investment and outcomes. Spending that sparks reinvestment produces better long-term returns and is better at stimulating job-creation and economic recovery.

When it comes to infrastructure, we have a $2 trillion problem debt of maintenance never performed, and an urgent need to steer infrastructure redevelopment funds to achieving two parallel goals simultaneously: bringing existing infrastructure up to code, while making the entire landscape of infrastructure fit for real performance in the 21st century economic climate.

A generative approach to valuing infrastructure budgeting is required: we must learn to evaluate the degree to which our overall economic resource base is expanded by the spending we do to promote redevelopment of crucial infrastructure.

The Road to Recovery

The nation’s infrastructure needs a major overhaul. It needs to be reinvented: not just upgraded to at long last meet existing code, but transitioned into a new technological era, in which smart grids, smart highways, and bullet trains will liberate the people of the United States, at the individual and community levels, like never before.

A few proposals:

• Consult the National Strategic Narrative [pdf], penned by Capt. Wayne Porter and Col. Mark Mykleby, for Adm. Mullen and the Joint Chiefs — sustainability (reliability of resources) is security
• Devote an existing segment of the Pentagon budget to infrastructural integrity
• Establish a new Infrastructure Improvement Bank
• Establish a new Engineering Corps for Economic Prosperity and Infrastructure Development
• Devote a segment of higher education funding to programs that foster advanced innovative thinking and technologies that free us from out-dated paradigms
• Calculate as part of our debt- and deficit-reduction strategy the long-term costs of failing infrastructure; build ROI from timely upkeep into long-term calculations
• Give the American people more options for transportation, privileging zero-emissions technologies
• Incentivize manufacturers and builders to abandon planned obsolescence, establish long-term resilience standards

And one more thing: tie all corporate tax credits to job-creation (in the US) and/or innovation. This will help to generate not only opportunity, household income, consumer spending, and revenue; it will also build into the recovering economy a pattern of compounded prosperity and new investment. Tax-spending (known to proponents as “cuts”) will build more value for the economy, and the middle class will have more influence, thereby setting the stage for policies that result in better quality shared infrastructure.

We have an opportunity to work together, as a free people, to rebuild our civic discourse, and to rebuild our nation’s infrastructure, to suit the advanced technological and economic demands of the 21st century. It is beneath us to avoid the task, and we will face real and degrading consequences, as a nation, if we do nothing to counter the crisis.

We will not fall magically into a rising tide of job creation, just by depriving ourselves of services and privileges we have built into our way of life and on which our prosperity depends. And we will not create jobs by privileging those industries that are doing the least to innovate. Innovation is the American way; it is what the nation has always struggled to accomplish, and it must be the cornerstone of a new job-creation boom.

It may be that moments of grave economic pressure put grave strain on a culture’s ability to give voice to and to share a common understanding of core values. It may be that after the financial collapse that struck in 2007 and 2008, the US is facing a crisis of conscience and a struggle to regain its identity. We need to remember that we can take the reins of the 21st century economic landscape, and build the economy of tomorrow.

We could look at the crisis and its aftermath and say, ‘we need some tough love to get us back on track’, and we would probably be right. But we can’t use that sentiment, that truism, to justify bad policy choices or to seek comfort in the idea of a swift break with good social services being better than a slow recovery. The stakes are too high, and the work of building a 21st century world-leading economy requires more vision than that.

It’s not always healthy to divide the world into then and now, before and after, but we can say that many of the old comforts of boundless American resources and economic prosperity are no more; we need to make a future from what we have, and the best resource we have is the ability to invent new paradigms and erect the infrastructure to put them into practice.

One very important clarification must first be made, however, before we can examine with any degree of seriousness how innovation will help to restore our economy to vigorous and viable health: narrowly focused innovations carried out by cartels of privilege to maximize their hold on the marketplace are not true innovations, but mere reiterations of the primitive practice of concentrating wealth to build feudal spheres of influence.

In a 21st century democracy, innovation has to work to the genuine benefit of the democratic landscape of ideas and interests, to the benefit of free individuals seeking to optimize their experience of democratic freedom. Economic innovation that liberates capital flows and actually expands opportunity for ordinary people is of paramount importance in this recovery.

Another way to say this would be to specify that we cannot accept simply “more of the same”, along with the vague promise that eventually it will benefit the hundreds of millions of citizens who are not millionaires or billionaires. We need to demand genuine improvements, in policy and in practice, that restore decentralized economic vigor to our society.

And we have genuine technological innovations that bring with them this very important combination of decentralized capital flows and innovation of business models and economic assumptions. We stand now at the brink of a new industrial revolution, for the information age: the building of a green economy sustainable in terms of its relationship with the natural environment, but also in its use of resources, and its generation of prosperity.

The transition to a smart-grid, clean-energy-based economy entails decentralizing the control of powerful energy cartels over the resources that give life to our society and to its markets. It entails the vital correction of distorted price signals, which presently conceal costs and burden us with wasteful spending. Clean energy will be free of the vast negative externalities that plague our economic system, invite volatility and hamper recovery.

In a society that seeks to be truly democratic, the marketplace for enterprise must continue to innovate in ways that improve the circumstance and opportunity of all members of the society. To stagnate in terms of how intelligently we do things is to withdraw from the mission of a democracy, which is to continually expand the degree of human dignity each citizen can demand and experience without peril.

At the present time, in the United States, we face a choice between major forces that favor the economic status quo, with its massive and accelerating wealth divide, and the power of a new paradigm, which will require the participation of more people, at a higher level of responsibility and education, justly rewarded by a higher standard of living.

The American Recovery and Reinvestment Act, and the President’s long-term budget reform, aimed at “winning the future” are sound beginnings, but cautious in comparison to what could be accomplished with a more explicit and committed push for building a green economy.

We need deep reforms to our economic and public policy landscape, but that does not mean we need to gut basic social services in favor of still more unaffordable tax cuts for the superrich. There is no economic theory that can support that policy, and there is no historical evidence of any kind that it would work or has worked, to create jobs.

Instead, we need to evaluate the actual social and economic value of spending (including tax cuts). What we have seen comprehensively, since the Bush tax cuts of 2001, is that when the “supply side”, the superrich and the business sector, are given massive tax cuts for no particular reason, they are not motivated to invest that money in job creation, but rather to hide it away in high-end investment strategies that avoid the volatility of enterprise altogether.

When the ARRA was passed, this began to change, because new tax breaks were targeted toward productive entrepreneurial activities, and there was no guarantee the Bush tax breaks would be extended. Job creation boomed and continued until 2011. But in December 2010, the Bush tax cuts were extended, even for the wealthiest of the wealthy, and the clear outcome has been a month-by-month slowing of overall job creation.

Once again, the history, and the economic logic, is clear: when you give would-be investors in job creation free cash, so that they don’t need enterprise to make them their extra cash, they slow down their job-creation activity. We need policies that will motivate wealth to flow toward new jobs, sustainable jobs, the kind of employment that doesn’t evaporate when investors suddenly find what they consider a sure thing.

So, we need to build a green economy:

• we need to build the infrastructure that will carry clean, renewable energy to all points of consumption;
• we need to retrain industrial workers to produce the technology that will produce clean, renewable energy;
• we need to employ millions of people to maintain and upgrade the infrastructure, install the production capacity and manage our rapid advance toward comprehensive energy efficiency;
• we need to liberate major capital flows to foster this level of technological and commercial innovation…

Some relatively subtle policy shifts can achieve this, but first of all is the standard that we will not continue to prop up, through subsidies, negative externalities or unfair pricing, industries and entities that refuse to be part of this innovation dynamic, this transition to a sustainable economy. Putting a price on carbon emissions will allow us to then motivate the flow of capital away from dirty, risky, expensive fossil fuels, reduce the negative externalities that plague our energy economy, and build the world-first true clean energy economy.

Doing so is a national imperative, because getting beyond combustible fuels is the destination for large-scale energy production. Whoever gets there first will be the world leader in the global economy of the 21st century. To create jobs, we need to innovate, not reward the least imaginative and least cooperative of our entrenched powers-that-be.

IndependentsOfPrinciple.com :: The House majority leader Eric Cantor (R-VA) recently published an op-ed, in which he argued that “If Washington actually had the discipline to live within its means over the long term, every American citizen would not owe $46,000 toward the national debt.” The rhetoric is effective, but the logic is flawed; not every American “owes” an equal share of the national debt.

The national debt is what the federal government owes in long-term interest on government-backed bonds, Treasury bonds. Long-term Treasury bonds pay out over several decades, and have (thanks to the high credit rating of the United States government) a very low rate of interest. The bonds are used to finance spending in the short term for which there are no sufficient tax revenues in reserve.

Over the life of a given Treasury bond, the interest accruing behaves, in a sense, as government debt. It requires that future budgets cover the cost of putting sufficient funds into a pool of revenues that will eventually be paid out as interest on those bonds. The rate of interest is often not as high as the rate of inflation, making it easy to “finance” the bonds without actually spending extra cash.

At the present time, the rate of interest is actually negative on some Treasury bonds. That means investors are paying more than they expect to get back, in order to have the security of investing in US Treasury bonds, the most secure investment product in the world. The national debt is what it will cost, over time, as all interest is paid out, to finance all bond payments.

The total is not necessarily more than all the revenue that can be expected to be taken in, over the life of the securities in question, and is not necessarily unsustainable, even when it reaches such high levels as 50%, or 80% or 100% of GDP. The comparison is something of a red herring, because GDP is annual (and more than 20% of it is government spending anyway), and long-term Treasury bonds pay out over several decades. More than the percentage of current-year GDP, it is the combination of inflation, GDP growth and tax policy that will determine the viability of such debt.

There are short-term T-bills as well, which “mature” in as few as three to six months, but the full scope of the “national debt” is more about long-term borrowing than short. Deficits are not healthy, unless the level of borrowing stays within the range that credit analysts and credit issuers (bond investors) view as likely to yield a reliable return.

But the key to understanding who actually “owes” money to pay down the national debt is understanding two key components of how it is financed: first, who owes what share of the tax burden, and second, who is actually benefitting from the debt itself, or rather, who is being financed by the government’s borrowing.

In the United States, at present, there is a tragic wealth divide that has, for decades, been eroding the middle class. The wealthy hold most of the wealth and take in most of the income. The top 20% own as much as 90% of all the investment income in the country (this includes Treasury bonds), as well as 84% or more of all the wealth.

It is the wealthy who invest in stocks which benefit directly from government spending (the bottom 50% of the “income ladder” hold virtually no investments of any kind). This could be the record Defense and war spending, or record subsidies to the most profitable corporations in history, the big oil companies. Or, it could be investments that benefit from the massive direct and indirect subsidies that flow to nuclear energy generation, coal production and natural gas drilling. It could be Medicare and Medicaid spending that helps to make the private health insurance model profitable, by covering the most costly segments of the population.

The wealthy enjoy many collateral benefits of government borrowing, not least of which is the direct financing of their own investments, whether through government spending, subsidies or bond payments. Many high-end private-sector investments simply would not be viable as a secure investment, without the government’s activities doing something to support that sector or that type of financial activity.

The fact is, the national debt is made up of a cycle of borrowing and of investment income, which benefits the wealthy far more than it benefits the poor. They benefit from every one of the public services the poor struggle to benefit from, and they do so not only on the personal level, but also as an indirect subsidy to the entire scope of their private investment portfolio, which depends on the stability of the American economy and of its government’s ability to borrow and to finance borrowing.

A scientific calculation of the overall cost-to-benefit ratio of national debt financing for the wealthy or for the poor, specifically, may be too complex to flesh out without a dedicated study. But when you consider that the working poor, and much of the middle class, enjoy relatively little investment income related to government borrowing, yet must pay a significant portion of their taxes each year to finance it, the national debt is actually a system of transfer of wealth from the middle class and working poor to the wealthy.

What motivates such hostile and vitriolic rhetoric on the tax-cuts-for-the-rich side of the political spectrum, in the United States, when discussing the national debt, is the very clear fact that it is their preferred constituency that in fact owes the majority share of the national debt. The populist rhetoric of the Tea Party is often driven by the misconception that everyone in the country will be working off tens of thousands of dollars in irresponsible government borrowing, which is simply not the case.

It is a fundamentally unfair and misleading calculation to say that the national debt should be divided equally among every man, woman and child in the United States, because the equation does not balance out. Indirect beneficiaries of government borrowing cannot owe more, relative to income, than direct beneficiaries. And those who pay more in pre-tax cash to finance government borrowing than they receive in after-tax cash returns on investment, cannot owe more than those who receive more in return than they pay in.

This is not a question of class warfare or of a socialist-minded redistribution of wealth. It is just simple arithmetic: if you are reaping complex financial rewards from the system of government borrowing, you cannot ask those who are paying out of pocket to help you, but getting nothing concrete in returns, to share your burden equally.

In other words, you cannot ask a military enlisted family of four, with one low-ranking military salary and one part-time private-sector salary, and two children, to pay $46,000 to help billionaires and hedge funds manage their profits. That every single American owes $46,000 to finance the national debt is a distortion: each owes his or her own share, and those shares depend on how the pie was divided up to begin with.

TheHotSpring.net :: As the Pentagon issues its official cyber-security posture, it is imperative that we move into the era of strategic cyber-security with one paramount aim: that cyberspace not be militarized in any substantive way by any nation. Cyberspace should operate much the way our space exploration has worked: aiming for technological superiority and peaceful, international cooperation.

The Pentagon’s publicly released policy report suggests that were a military-type cyber attack to lead to damage and casualties comparable to a conventional military attack, it might be treated as an act of war and warrant a military or cyber-military response. But wisely, at least as is publicly known, there is no existing plan to organize a “cyber force” to militarize cyberspace as already exist with land, sea and air.

The Internet was developed in large part by Pentagon advanced research as a communications tool, to help improve the chances of ably protecting against an intercontinental or sea-borne attack during the Cold War. But as a tool of civilian communication it has far outstripped the projected value and productivity of its original design.

So much so, there is a growing legal movement, across the world, to treat Internet access as a basic human right, on a par with access to clean air and clean water. Knowledge, of course, has nearly the same value, in terms of determining whether an individual or a population will have the ability to compete and to stave off oppression, in a technologically organized global civilization.

Cyber-security is an issue of human rights and democracy. If governments, foreign or domestic, are able to use the Internet to impose their will on otherwise free people, real freedoms can be infringed and democratic societies can become vulnerable to the whims of tyrants. But cyber-security is in many ways like environmental security: just as we have a right to clean drinking water, we have a right to unobstructed access to information.

This should be the aim of any regime of national cyber-security, not the application, or projection, of centuries old military force doctrine to the world of digital information and communication. In the atmosphere of true hyper-convergence, the web beyond Facebook and gMail, the integrated freedom of the individual depends on the integrated civil liberty of the world wide web.

Just as we expect to go about our days without tanks rolling down our streets, we must demand we have the liberty to use the Internet as we choose, and safely, without military intervention or monitoring.

The investigative news magazine Vanguard reports from Indonesia on the tobacco industry’s massive, coordinated effort to get as many young people across the developing world, hooked on deadly cigarettes, in order to profit from their addiction. New York mayor Michael Bloomberg says 1 billion people will be killed by smoking this century, unless something is done to curb big tobacco’s efforts to profit from destroying the health of its customers.

This is more than a major public health crisis; this is a humanitarian disaster being planned, being deliberately built into developing economies around the world, and which hinges on luring young children into a life of addiction, disease and early death. It is the single largest campaign of planned toxic contamination of the human population, and, given what the tobacco industry knows about its product, could be considered to be the most widespread coordinated effort to wipe out millions of human lives.

In the United States more than anywhere else, and now in Europe, significant government attention has been given to the urgent need to counteract the long history of false advertising and impunity. Tobacco companies are being forced to advertise not in favor of their products, but to alert the public to the extreme health risk posed by their products. It is increasingly routine to see bold written warnings and even gruesome photographs on cigarette packs themselves.

In New York City, public health is winning out over profits, as the city has successfully barred smoking in all places of business, in any indoor setting where non-smokers or children might be affected, and in 1,700 public parks. While on the streets of Spain, it may still be almost impossible to walk for 30 seconds without getting a whiff of tobacco smoke, in New York City, one can go for days without seeing one lit cigarette.

We know that public health campaigns, bans on smoking, and high sin taxes, work. And we know that places like New York City, or Dublin, Ireland, where smoking bans have taken effect, are not harmed by the legislation, but in fact have seen a boom in the public’s use of restaurants and bars. The center of New York City is now being remade as a pedestrian-friendly open-air city center, organized around people, and tourism is booming.

But a global public health campaign is needed to bar big tobacco’s entry into these new markets. Policies that make it extremely expensive, or extremely difficult, for tobacco producers to advertise their product, to sell their product, and which penalize any and all entities connected in any way with the sale of tobacco to minors, must be developed and adopted, across borders.

The desperate situation in Indonesia, where it is expected well more than half the juvenile population will begin smoking by adolescence, along with the tobacco industry’s plans to move aggressively into India, China and to target poor areas of Asia as a boom market, may necessitate a global anti-tobacco treaty, with real legal penalties and sanctions for public officials, businesses and nations, which seek to use the young and vulnerable for profit which will take their lives.

Please join our discussion on how to stop the spread of deadly tobacco products to the developing world.

TheHotSpring.net :: The United States of America has been, since its birth 235 years ago, a world leader in promoting universal public education. It has also been a world leader in promoting universal access to higher education and to advanced degrees. That history has made the US a leader in technological innovation and advanced problem solving for two centuries. That legacy is under threat, and national educational aims demand immediate attention.

In the current budgetary and economic climate, cuts to public education, the rolling back of teachers’ salary opportunities, job security and benefits, and the underfunding of financial aid for higher education, are threatening to stunt the quality of education available to millions of Americans. But education is the key to strong, resilient democracy.

The new report describing a National Strategic Narrative for the United States, for the 21st century, from two top Pentagon analysts, finds that the United States must put top-quality education above all other priorities, privilege the virtues of sustainability in economic and security policy, and leverage mutually beneficial relationships with foreign powers.

The value of top quality education for the future of any society is almost incalculable: it affects the relative value of all other elements of the economy, and the efficacy of all areas of public policy, governance and democratic process, including security policy and conflict resolution. There is substantial evidence that lack of universalized top-quality education imposes major costs on entire societies.

Those added cost burdens, from economic and policy inefficiency, to counterproductive security actions, degraded infrastructure and sluggish entrepreneurial activity, can degrade the quality of life for most people in a society, degrade the quality of public discourse and public policy action, and undermine national security and economic prosperity, generally.

Lower quality educational resources build into a society patterns of unnecessary waste and degradation. Top quality educational resources build into a society the capacity for vibrant, rapid, innovative adaptation to changes in an evolving landscape. With the 21st century more likely to be defined by an evolving global political and economic landscape, nothing is of more paramount concern than the quality of education available to every last person living within a given geographical area.

Nothing will define a nation’s ability to compete in international markets more directly or comprehensively than the level of educational opportunity enjoyed by its people.

We are entering an age that is no longer about building industrial capacity or penetrating beyond new frontiers in terms of geographical or spatial exploration. Technology is advanced enough that many new technologies can be mapped out intelligently long before they are within the realm of the practical.

We are entering an age in which the ability of an individual, a company, a region or a nation, to solve problems rapidly, efficiently and with little resulting negative feedback, will be the decisive quality in determining success or failure, prosperity or ruin. Borrowing problem-solving capacity from another society is not like borrowing industrial capacity; there is no way to export the cost while importing the benefit.

If the United States is to prosper in the 21st century as it did during the 2oth, if it is to lead on the global stage in a credible way, it has to maintain its ability to be the most credible, open and constructive resource for problem-solving, and that means it must have the best quality human capital, the most talent, the most informed, creative and forward-thinking population.

While Europe and China are weathering the global economic slowdown with a renewed focus on higher education, the United States Congress has been seeking to roll back funding for public education generally and for access to higher education, already prohibitively expensive for most Americans.

Pres. Obama instituted one of his boldest and least well-known reforms in 2009, when he replaced the expensive, slow and bank-run system of student financial aid with a more direct system of loans from the government to students, with incentives for repayment, lower interest rates, better access to top-flight institutions, and long-term incentives to make use of one’s talents in ways that benefit the wider economy and the nation.

That student financial aid reform must be a building block, with new initiatives at the state and national levels both to foster not test-score improvements, but genuine improvements in educational quality, critical thinking, creative reasoning and intellectual skills that infuse the landscape of scientific and commercial innovation with real potential for designing and riding the wave of the new economy of this century.