Why We're All Mad As Hell at Washington

Cutting the credit rating

Where is it going to come from?

Summer brings the posting on most blogs to a slower pace, as some like this site slow down, or for some, a pause as the go on vacation. The news of the July was dominated by a house divided upon itself, as those we charge with leadership and the expectation to rise above the bubbling mass of goo that most Americans have come to see in Washington; played chicken with our future in order to appeal to their hardcore constituency.

Usually, I refrain from taking any political side, but a post today by blog friend, author and geo-strategist Thomas PM Barnett perfectly articulated my feelings about the current state of our economy, and the lack of visionary leadership by all who are charged with keeping the country safe, strong and prepared for the future. Barnett's post starts off by commenting on a column by Thomas Friedman in the NYT's and excerpting comments from Kenneth Rogoff, an economist from Harvard who Tom paraphrases this way.

Rogoff's point is simple but very revealing: we've all known this crisis to be a financial one versus the usual biz cycle. Recovering from biz-cycle contractions is historically a quick affair, but recovering from a financial crisis is typically more the 5-7 years horizontal scenario. Rogoff's key insight is to state the obvious (for most of us consumers): the "recovery" of the business cycle has already arrived and it changed nothing for most people, because the hangover is a long-term credit contraction - i.e., the huge deleveraging.

This led Barnett to bring the current crisis home, and describe how it affected him personally. His observation and feelings are shared by all of us Americans, who have struggled to maintain their mortgages, paid their taxes, hustled to recover income lost due to the downturn, and hold out hope that both parties will gin up some backbone to understand that we ALL, are plenty pissed off at everybody in Washington. See if his words don't sound like that angry voice in your own head?

I feel this personally in spades: built a nice big house in 05-06 at the height of the bubble (of course, I walked away from the old house with an inflated sum, so no complaints), so the house is priced in that way - as is my mortgage. At the time, no problem, because I'm getting paid in a bubblicious way.

Then the crisis. All of a sudden everyone says my labor is worth a whole lot less. Still love me and the work, just want to pay a lot less. Everybody is doing this, except my mortgage holder. He wants that to stay the same. 

I'm lucky. Despite losing a ton of income over the past two years, I've scrambled and replaced the vast majority. I have to work three times as hard for 5 times as many customers, but I'm managing because I'm not reliant on any one job and I'm willing to hustle.

So I do the right thing and don't strategically default on a mortgage, which is tempting, not because I can't pay it because I can - and am. It's tempting because, geez, why should I pay off this debt honorably across this long crunch while so many others get help or simply run away? Because when I do, I subsidize all their behavior.

Tom goes on to point out, what many of us who work hard have come to feel like, the problem!

Worse, I have a White House that claims I'm the problem because I don't pay enough taxes and so it wants to soak me because that's an evil state of affairs. Funny thing is, I pay the Fed a whopping sum every year - about three times as much as my dad ever made in a year while he supported us seven kids. So naturally, when more than one out of every three dollars I make goes to the government, I feel like I'm supporting all sorts of programs for the needy, plus I'm doing the right thing by the mortgage, plus I keep up my charity donations, plus I pay 3 private grade school tuitions (saving the public schools) and two public college tuitions (eldest daughter and wife). I don't ask for any hand-outs from the government. Hell, I fund them and am glad to do so. But then I'm told I'm the reason why the government is so in debt (not enough taxes from the "rich") and yet I'm the dupe who continues honoring that mortgage from another era while paying for the bail-outs of those who can't. And you know, I don't feel like I'm the problem - or evil for doing all that.

Tom Barnett has been called many things, but the one that stands out, is of being an optimist about the future. When I read this next paragraph, it gave me pause that he glass was full and he had reached the point that he would not stand by and take it anymore.

But no, I have no optimism about the future of our economy right now. I don't how I could. I know what I know about globalization and America's long-term strengths, but I look at Washington and I see clueless politicians with no business experience spending all their time trying to tear each other down and I wonder why I must suffer these fools.

His final words ring like the battlecry from the discouraged middleclass.

But most of all, I f--king hate the government right now for being such incompetent boobs. I would be happy to see them all lose in 2012 - and will vote that way.

Read more:
Rogoff's "second great contraction" and why I'm mad as hell at Washington

With a growing number of Americans, 47% paying no federal income tax, against the shrinking 53% who do, and with the crisis at hand, raising taxes in some form is in the cards, but as Rogoff suggests, it must be on something other than personal income; like a tax on gasoline or a national sales tax. Otherwise if it is raised on those who earn over $250,000, then even the lowest should have to pay something, at least a few percentage points to give them a dog in the fight.

What We Fight For, and Why We Lead.

Where In The Hell Is Matt?

Books Authored by LtC Robert Bateman, USA

Economic Freedom Map 2008

Todays, two Americans, both great lovers of their country, take center stage here at HG's World. The first article is by Lieutenant Colonel Robert L. Bateman, USA, who describes himself as an infantryman, historian and prolific writer. I admit that Colonel Bateman has ruffled my feathers a few times in the past, but this time he hit a homerun, and in the words of the editors of the SWJ Blog was "spot-on." I totally concur and recommend, What I Fight For by Robert Bateman.

The story in Bateman's words:

Recently on an e-mail based discussion group in which I participate, there was some extended debate about how much language training was enough and which was more important, language training or history/culture education, for deploying soldiers. It was an informed and interesting squabble, with practitioners from every American war since Korea piping in with opinions and points of evidence. Then one fellow, a former-soldier-turned-photojournalist named Jim, plopped down the Truth. His simple formulation? "It's a people thing."

Now I am not a big one for the whole "emotional" thingeemabob. In most debates I want footnotes, documentation, and fracking proof for everything. People who know my history know this about me. But there are limits, and Jim's simple statement hit the mark. Sometimes, some very rare times, you don't need proof. You don't need evidence. You need only know how to feel, and be human. Jim, I knew instantly, was right.

.....OK, so a few years ago this doofus Seattle kid, a 20 something named Matt, decided he wanted to see the world. He took off, and it being the internet age and all, he updated his friends with short snippet videos from all over. The hook was that all of his friends firmly believed that this fellow, Matt, was quite possibly the worst dancer in all of human history.

They were probably right.

But because young Matt had a sense of humor, the snippet videos he sent to his friends from around (that time) South and SE Asia, were all of him dancing his somewhat, ahhhh, unique "dance" in various locals.

Then somebody tied all the videos together. It went "viral"...meaning that people across the planet watched it. Millions upon millions of them. Including some very saavy marketers at an Australian gum company called "Stride." They wrote to Matt and said, "Hey mate, like to do it again on our dime?" So Matt went around the world again, doing his doofy dance. That video was even bigger. Matt was inundated with mail, and Stride saw a global marketing boost, so they (being Aussies) said, "Double down mate." And Matt fused the two...all of the e-mail he had from around the planet...people who loved his video, and a travel expense account that his unemployed butt could have never supported.

This video was the upshot: Where The Hell is Matt?

And THIS, ladies and gentlemen, is what we fight for. Or at least it is one part of what I fight for. Your mileage may vary, but for me, the vision of the world that this dumb-ass, 20-something, no-talent Muldoon gave us through his genius is enough. Our world is farked up, or at least large parts of the world...the parts that we Soldiers (and our brothers, the Marines) see, are often farked up. But young Matt, with this effing magnificent, transcendent, unifying-the-whole-goddamned-planet vision, which he demonstrated to the world all by his lonesome far better (judging by the 26 million hits on this video) than DoD, or State, or than any part of our government ever has, is a vision of the planet that represents what I want for our collective future.

My friend Jim is right. "It's a People Thing."

I hope this is what you fight for as well. Regardless of your nationality.

Watch this video.

Colonel Bateman gets it totally right. The essence of this story goes hand in hand with this next post by Thomas Barnett in his weekly column. His topic is that America's role has not diminished so much that it is poised to reclaim the traditional role of moral leadership, that we have had for the past century.

Barnett begins:

Wise men tell Americans that our nation no longer leads this world: We bankrupted ourselves first ideologically through unilateralism, then militarily through "global war," and now financially through the debt crisis. Rising great powers, we are told, now lead the way.

But where do we locate this new leadership?

In Europe's self-absorption over its rising Muslim quotient?

In Russia's self-inflicted economic penance for its smackdown of Georgia?

In India's crippling obsession with Pakistan?

In China's super-cooling economy and the social unrest it'll trigger?

In Japan's - whatever Japan is doing nowadays?

So which foreign leader has captured the world's attention with his promise of changed leadership?

Read the whole column to find out.

Barnett: World still needs America to lead

Barnett closes with this observation:

We can't borrow any more and thus can't police anywhere else without a dramatic renegotiation of that great power compact.

Furthermore, both aging West and rising East must come together to create and nurture markets among globalization's bottom-of-the-pyramid populations, for there will be found, in China's and India's rural interior as well as Africa's untapped labor pools, tomorrow's dramatically expanded global middle class. That's where our economic competition with China truly lies: seeing who captures the most new markets in coming years.

In the end, this unfolding drama we call globalization cannot advance without its chronically ambivalent lead - its Hamlet. For, if America does not lead the world's great powers against today's sea of troubles, there will be no fortunes preserved - much less won - and only further slings and arrows to be suffered.

These two converging ideas represent the best America has to offer the world. The crusty, evidence demanding soldier-historian Bateman gets it. Barnett has been preaching this message for the past two decades. To see the pen and the sword both understand, that it is in the words of Bateman's friend Jim, "It's a people thing" the future however currently in doubt, will sail on and our human resilience will meet the challenge.